Exhibit 10.1
Execution Version
LOAN AND SECURITY AGREEMENT
THIS LOAN AND SECURITY AGREEMENT is made and dated as of February 5, 2016 and is
entered into by and among CYTRX CORPORATION, a Delaware corporation, and each of
its Qualified Subsidiaries (hereinafter collectively referred to as "Borrower"),
the several banks and other financial institutions or entities from time to time
parties to this Agreement (collectively, referred to as "Lender") and HERCULES
TECHNOLOGY GROWTH CAPITAL, INC., a Maryland corporation, in its capacity as
administrative agent for itself and Lender (in such capacity, "Agent").  
RECITALS
A.            Borrower has requested Lender to make available to Borrower a loan
in an aggregate principal amount of up to $40,000,000 (the "Term Loan" and such
amount, the "Maximum Term Loan Amount"); and
B.            Lender is willing to make the Term Loan on the terms and
conditions set forth in this Agreement.
AGREEMENT
NOW, THEREFORE, Borrower, Agent and Lender agree as follows:
SECTION 1.                                        DEFINITIONS AND RULES OF
CONSTRUCTION
1.1            Unless otherwise defined herein, the following capitalized terms
shall have the following meanings:
"Account Control Agreement(s)" means any agreement(s) entered into by and among
Agent, Borrower and a third party bank or other institution (including a
Securities Intermediary) in which Borrower maintains a Deposit Account or an
account holding Investment Property and pursuant to which Agent obtains
"control" (as such term is defined in the UCC) over the subject account or
accounts.
"ACH Authorization" means the ACH Debit Authorization Agreement in substantially
the form of Exhibit H, on which account numbers shall be redacted for security
purposes if and when filed publicly by Borrower.
"Additional Advance" has the meaning given to it in Section 2.1(a).
"Additional Term Loan Advance Period" means the period beginning on the date
that Borrower achieves the Milestone and ending on December 31, 2016, or such
later date that Agent otherwise determines in its sole discretion.
"Advance(s)" means any Term Loan Advance(s).
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"Advance Date" means the funding date of any Advance(s).
"Advance Request" means a request for an Advance submitted by Borrower to Agent
in substantially the form of Exhibit A, on which account numbers shall be
redacted for security purposes if and when filed publicly by Borrower.
"Affiliate" means (a) any Person that directly or indirectly controls, is
controlled by, or is under common control with the Person in question, (b) any
Person directly or indirectly owning, controlling or holding with power to vote
twenty percent (20%) or more of the outstanding voting securities of another
Person, (c) any Person twenty percent (20%) or more of whose outstanding voting
securities are directly or indirectly owned, controlled or held by another
Person with power to vote such securities, or (d) any Person related by blood or
marriage to any Person described in subsection (a), (b) or (c) of this
paragraph.  As used in the definition of "Affiliate," the term "control" means
the possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of a Person, whether through ownership
of voting securities, by contract or otherwise.
"Agent" has the meaning given to it in the preamble to this Agreement.
"Agreement" means this Loan and Security Agreement, as amended from time to
time.
"Amortization Date" means March 1, 2017; provided, however, (a) if the First
Interest Only Extension Condition is satisfied, then the Amortization Date shall
mean September 1, 2017, and (b) if the Second Interest Only Extension Condition
is satisfied, then the Amortization Date shall mean March 1, 2018.
"Assignee" has the meaning given to it in Section 11.13.
"Base Amount" has the meaning given to it in Section 7.16(a).
"Borrower Products" means all products, software, service offerings, technical
data or technology currently being designed, manufactured or sold by Borrower or
which Borrower intends to sell, license or distribute in the future including
any products or service offerings under development, collectively, together with
all products, software, service offerings, technical data or technology that
have been sold, licensed or distributed by Borrower since its incorporation.
"Borrower" has the meaning given to it in the preamble to this Agreement.
"Business Day" means any day other than Saturday, Sunday and any other day on
which banking institutions in the State of California are closed for business.
"CDARS Amounts" means cash deposits maintained by Borrower through the
Certificate of Deposit Account Registry Service, with such amounts and maturity
dates as set forth on Exhibit E.
"Cash" means all cash, cash equivalents and liquid funds.
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 "Change in Control" means any reorganization, recapitalization, consolidation
or merger (or similar transaction or series of related transactions) of
Borrower, sale or exchange of outstanding shares (or similar transaction or
series of related transactions) of Borrower in which the holders of Borrower's
outstanding shares immediately before consummation of such transaction or series
of related transactions do not, immediately after consummation of such
transaction or series of related transactions, retain shares representing more
than fifty percent (50%) of the voting power of the surviving entity of such
transaction or series of related transactions (or the parent of such surviving
entity if such surviving entity is wholly owned by such parent), in each case
without regard to whether Borrower is the surviving entity.
"Claims" has the meaning given to it in Section 11.10.
"Closing Date" means the date of this Agreement.
"Collateral" means the property described in Section 3.
"Common Stock" means the Common Stock, $0.001 par value per share of Borrower.
"Confidential Information" has the meaning given to it in Section 11.12.
"Contingent Obligation" means, as applied to any Person, any direct or indirect
liability, contingent or otherwise, of that Person with respect to (i) any
Indebtedness, lease, dividend, letter of credit or other obligation of another
Person, including any such obligation directly or indirectly guaranteed,
endorsed, co-made or discounted or sold with recourse by that Person, or in
respect of which that Person is otherwise directly or indirectly liable; (ii)
any obligations with respect to undrawn letters of credit, corporate credit
cards or merchant services issued for the account of that Person; and (iii) all
obligations arising under any interest rate, currency or commodity swap
agreement, interest rate cap agreement, interest rate collar agreement, or other
agreement or arrangement designated to protect a Person against fluctuation in
interest rates, currency exchange rates or commodity prices; provided, however,
that the term "Contingent Obligation" shall not include endorsements for
collection or deposit in the ordinary course of business.  The amount of any
Contingent Obligation shall be deemed to be an amount equal to the stated or
determined amount of the primary obligation in respect of which such Contingent
Obligation is made or, if not stated or determinable, the maximum reasonably
anticipated liability in respect thereof as determined by such Person in good
faith; provided, however, that such amount shall not in any event exceed the
maximum amount of the obligations under the guarantee or other support
arrangement.
"Copyright License" means any written agreement granting any right to use any
Copyright or Copyright registration, now owned or hereafter acquired by Borrower
or in which Borrower now holds or hereafter acquires any interest.
"Copyrights" means all copyrights, whether registered or unregistered, held
pursuant to the laws of the United States, any state thereof or any other
country.
"Deposit Accounts" means any "deposit accounts," as such term is defined in the
UCC, and includes any checking account, savings account or certificate of
deposit.
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"Domestic Subsidiary" means any Subsidiary that is not a Foreign Subsidiary.
"Due Diligence Fee" means $25,000, which Lender acknowledges has been paid as of
the Closing Date, and shall be deemed fully earned on the Closing Date
regardless of the early termination of this Agreement.
"Eligible Foreign Subsidiary" means any Foreign Subsidiary whose execution of a
Joinder Agreement would not result in a material adverse tax consequence to
Borrower.
"End of Term Amount" means $1,771,250, plus, subject to and contingent on the
funding of the Additional Advance by Lender, $408,750.
"ERISA" means the Employee Retirement Income Security Act of 1974, as amended,
and the regulations promulgated thereunder.
"Event of Default" has the meaning given to it in Section 9.
"Equity Event" means any sale or issuance of Borrower securities for financing
purposes primarily to institutional investors (whether in a private placement,
registered offering or otherwise).
"Exercise Price" means the Exercise Price as defined in the Warrants, as it may
be adjusted from time to time pursuant to the applicable provisions of the
Warrants.
"Facility Charge" means an amount equal to 1.00% of the Maximum Term Loan
Amount.
"Financial Forecast" has the meaning given to it in Section 7.16(a).
"Financial Statements" has the meaning given to it in Section 7.1.
"First Interest Only Extension Condition" means the achievement by Borrower of
the milestone set forth in clause (i) of the definition of Milestone in
accordance with such definition.
"Foreign Subsidiary" means any Subsidiary other than a Subsidiary organized
under the laws of any state within the United States.
"GAAP" means generally accepted accounting principles in the United States of
America, as in effect from time to time.
"Indebtedness" means (a) all indebtedness for borrowed money or the deferred
purchase price of property or services (excluding trade credit entered into in
the ordinary course of business due within 90 days), including reimbursement and
other obligations with respect to surety bonds and letters of credit, (b) all
obligations evidenced by notes, bonds, debentures or similar instruments,
(c) all capital lease obligations, and (d) all Contingent Obligations.
"Indemnified Person" has the meaning given to it in Section 6.3.
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"Insolvency Proceeding" means any proceeding by or against any Person under the
United States Bankruptcy Code, or any other bankruptcy or insolvency law,
including assignments for the benefit of creditors, compositions, extensions
generally with its creditors, or proceedings seeking reorganization,
arrangement, or other similar relief.
"Intellectual Property" means all of Borrower's Copyrights, Trademarks, Patents,
Licenses, trade secrets and inventions, mask works, applications therefor and
reissues, extensions, or renewals thereof; and Borrower's goodwill associated
with any of the foregoing, together with Borrower's rights to sue for past,
present or future infringement of Intellectual Property and the goodwill
associated therewith.
"Investment" means any beneficial ownership (including stock, partnership or
limited liability company interests) of or in any Person, or any loan, advance
or capital contribution to any Person or the acquisition of all, or
substantially all, of the assets of another Person.
"Joinder Agreements" means for each Qualified Subsidiary, a completed and
executed Joinder Agreement in substantially the form attached hereto as
Exhibit G.
"Lender" has the meaning given to it in the preamble to this Agreement.
"Liabilities" has the meaning given to it in Section 6.3.
"License" means any Copyright License, Patent License, Trademark License or
other license of rights or interests.
"Lien" means any mortgage, deed of trust, pledge, hypothecation, assignment for
security, security interest, encumbrance, levy, lien or charge of any kind,
whether voluntarily incurred or arising by operation of law or otherwise,
against any property, any conditional sale or other title retention agreement,
and any lease in the nature of a security interest.
"Loan" means the Advance(s) made under this Agreement.
"Loan Documents" means this Agreement, the Notes (if any), the ACH
Authorization, the Account Control Agreements, the Joinder Agreements, all UCC
Financing Statements, the Warrants, and any other documents executed in
connection with the Secured Obligations or the transactions contemplated hereby,
as the same may from time to time be amended, modified, supplemented or
restated.
"Material Adverse Effect" means a material adverse effect upon: (i) the
business, operations, properties, assets or financial condition of Borrower and
its Subsidiaries taken as a whole; or (ii) the ability of Borrower to perform or
pay the Secured Obligations in accordance with the terms of the Loan Documents,
or the ability of Agent or Lender to enforce any of its rights or remedies with
respect to the Secured Obligations; or (iii) the Collateral or Agent's Liens on
the Collateral or the priority of such Liens.
"Maximum Term Loan Amount" has the meaning given to it in the Recitals.
"Maximum Rate" has the meaning given to it in Section 2.2.
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"Milestone" means Borrower's achievement of the following, each as confirmed by
Agent in its reasonable discretion: (i) Borrower announces positive data from
the ongoing Phase 3 clinical trial of aldoxorubicin for the treatment of soft
tissue sarcoma; and (ii) Borrower demonstrates (in accordance with a development
plan and timeline to be agreed between Borrower and Agent promptly following the
Closing Date) continued progress in the development of a second novel drug
candidate based on the LADR technology platform such that it will initiate a
clinical trial under an Investigational New Drug Application prior to December
31, 2016.
"Note(s)" means any Term Note(s).
"Patent License" means any written agreement granting any right with respect to
any invention on which a Patent is in existence or a Patent application is
pending, in which agreement Borrower now holds or hereafter acquires any
interest.
"Patents" means all letters patent of, or rights corresponding thereto, in the
United States or in any other country, all registrations and recordings thereof,
and all applications for letters patent of, or rights corresponding thereto, in
the United States or any other country.
"Permitted Indebtedness" means: (i) Indebtedness of Borrower in favor of Lender
or Agent arising under this Agreement or any other Loan Document;
(ii) Indebtedness existing on the Closing Date which is disclosed in
Schedule 1A; (iii) Indebtedness of up to $250,000 outstanding at any time
secured by a Lien described in clause (vii) of the defined term "Permitted
Liens," provided such Indebtedness does not exceed the cost of the Equipment
financed with such Indebtedness; (iv) Indebtedness to trade creditors incurred
in the ordinary course of business, including Indebtedness incurred in the
ordinary course of business with corporate credit cards; (v) Indebtedness that
also constitutes a Permitted Investment; (vi) Subordinated Indebtedness;
(vii) reimbursement obligations in connection with letters of credit that are
secured by Cash and issued on behalf of Borrower or a Subsidiary thereof in an
amount not to exceed $200,000 at any time outstanding, (viii) other Indebtedness
in an amount not to exceed $100,000 at any time outstanding, (ix) intercompany
Indebtedness as long as either (A) each of the Subsidiary obligor and the
Subsidiary obligee under such Indebtedness is a Qualified Subsidiary that has
executed a Joinder Agreement and (x) extensions, refinancings and renewals of
any items of Permitted Indebtedness, provided that the principal amount is not
increased or the terms modified to impose materially more burdensome terms upon
Borrower or its Subsidiary, as the case may be.
"Permitted Investment" means: (i) Investments existing on the Closing Date which
are disclosed in Schedule 1B; (ii) (a) marketable direct obligations issued or
unconditionally guaranteed by the United States of America or any agency or any
State thereof maturing within one year from the date of acquisition thereof,
(b) commercial paper maturing no more than one year from the date of creation
thereof and currently having a rating of at least A-2 or P-2 from either
Standard & Poor's Corporation or Moody's Investors Service, (c) certificates of
deposit issued by any bank with assets of at least $500,000,000 maturing no more
than one year from the date of investment therein, and (d) money market
accounts; (iii) repurchases of stock from former employees, directors, or
consultants of Borrower under the terms of applicable repurchase agreements at
the original issuance price of such securities in an aggregate amount not to
exceed $250,000 in any fiscal year, provided that no Event of Default has
occurred, is continuing or would exist after giving effect to the repurchases;
(iv) Investments accepted in connection with Permitted Transfers; (v)
Investments (including debt obligations) received in connection with the
bankruptcy or reorganization of customers or suppliers and in settlement of
delinquent obligations of, and other disputes with, customers or suppliers
arising in the ordinary course of Borrower's business; (vi) Investments
consisting of notes receivable of, or prepaid royalties and other credit
extensions, to customers and suppliers who are not Affiliates, in the ordinary
course of business, provided that this subparagraph (vi) shall not apply to
Investments of Borrower in any Subsidiary; (vii) Investments consisting of loans
not involving the net transfer on a substantially contemporaneous basis of cash
proceeds to employees, officers or directors relating to the purchase of capital
stock of Borrower pursuant to employee stock purchase plans or other similar
agreements approved by Borrower's Board of Directors; (viii) Investments
consisting of travel advances in the ordinary course of business; (ix)
Investments in newly-formed Domestic Subsidiaries, provided that each such
Domestic Subsidiary enters into a Joinder Agreement promptly after its formation
by Borrower and execute such other documents as shall be reasonably requested by
Agent; (x) Investments in Foreign Subsidiaries approved in advance in writing by
Agent; (xi) joint ventures or strategic alliances in the ordinary course of
Borrower's business consisting of the nonexclusive licensing of technology, the
development of technology or the providing of technical support, provided that
any cash Investments by Borrower do not exceed $100,000 in the aggregate in any
fiscal year; and (xii) additional Investments that do not exceed $250,000 in the
aggregate.
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"Permitted Liens" means any and all of the following: (i) Liens in favor of
Agent or Lender; (ii) Liens existing on the Closing Date which are disclosed in
Schedule 1C; (iii) Liens for taxes, fees, assessments or other governmental
charges or levies, either not delinquent or being contested in good faith by
appropriate proceedings; provided, that Borrower maintains adequate reserves
therefor in accordance with GAAP; (iv) Liens securing claims or demands of
materialmen, artisans, mechanics, carriers, warehousemen, landlords and other
like Persons arising in the ordinary course of Borrower's business and imposed
without action of such parties; provided, that the payment thereof is not yet
required; (v) Liens arising from judgments, decrees or attachments in
circumstances which do not constitute an Event of Default hereunder; (vi) the
following deposits, to the extent made in the ordinary course of business:
deposits under worker's compensation, unemployment insurance, social security
and other similar laws, or to secure the performance of bids, tenders or
contracts (other than for the repayment of borrowed money) or to secure
indemnity, performance or other similar bonds for the performance of bids,
tenders or contracts (other than for the repayment of borrowed money) or to
secure statutory obligations (other than Liens arising under ERISA or
environmental Liens) or surety or appeal bonds, or to secure indemnity,
performance or other similar bonds; (vii) Liens on Equipment or software or
other intellectual property constituting purchase money Liens and Liens in
connection with capital leases securing Indebtedness permitted in clause
(iii) of the definition of "Permitted Indebtedness"; (viii) Liens incurred in
connection with Subordinated Indebtedness; (ix) leasehold interests in leases or
subleases and licenses granted in the ordinary course of business and not
interfering in any material respect with the business of the licensor; (x) Liens
in favor of customs and revenue authorities arising as a matter of law to secure
payment of custom duties that are promptly paid on or before the date they
become due; (xi) Liens on insurance proceeds securing the payment of financed
insurance premiums that are promptly paid on or before the date they become due
(provided that such Liens extend only to such insurance proceeds and not to any
other property or assets); (xii) statutory and common law rights of set-off and
other similar rights as to deposits of cash and securities in favor of banks,
other depository institutions and brokerage firms; (xiii) easements, zoning
restrictions, rights-of-way and similar encumbrances on real property imposed by
law or arising in the ordinary course of business so long as they do not
materially impair the value or marketability of the related property; (xiv) (A)
Liens on Cash securing obligations permitted under clause (vii) of the
definition of Permitted Indebtedness and (B) security deposits in connection
with real property leases, the combination of (A) and (B) in an aggregate amount
not to exceed $300,000 at any time; and (xv) Liens incurred in connection with
the extension, renewal or refinancing of the Indebtedness secured by Liens of
the type described in clauses (i) through (xi) above; provided, that any
extension, renewal or replacement Lien shall be limited to the property
encumbered by the existing Lien and the principal amount of the Indebtedness
being extended, renewed or refinanced (as may have been reduced by any payment
thereon) does not increase.
"Permitted Transfers" means (i) sales of Inventory in the ordinary course of
business, (ii) non-exclusive licenses and similar arrangements for the use of
Intellectual Property in the ordinary course of business and licenses that could
not result in a legal transfer of title of the licensed property but that may be
exclusive in respects other than territory and that may be exclusive as to
territory only as to discreet geographical areas outside of the United States in
the ordinary course of business, or (iii) dispositions of worn-out, obsolete or
surplus Equipment at fair market value in the ordinary course of business, and
(iv) other Transfers of assets having a fair market value of not more than
$250,000 in the aggregate in any fiscal year.
"Person" means any individual, sole proprietorship, partnership, joint venture,
trust, unincorporated organization, association, corporation, limited liability
company, institution, other entity or government.
"Preferred Stock" means at any given time any equity security issued by Borrower
that has any rights, preferences or privileges senior to Borrower's Common
Stock.
"Prepayment Charge" has the meaning given to it in Section 2.4.
"Publicity Materials" has the meaning given to it in Section 11.18.
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"Qualified Accounts" has the meaning given to it in Section 7.16.
"Qualified Subsidiary" means any direct or indirect Domestic Subsidiary or
Eligible Foreign Subsidiary.
"Receivables" means (i) all of Borrower's Accounts, Instruments, Documents,
Chattel Paper, Supporting Obligations, letters of credit, proceeds of any letter
of credit, and Letter of Credit Rights, and (ii) all customer lists, software,
and business records related thereto.
"Required Lenders" means at any time, the holders of more than 50% of the sum of
the aggregate unpaid principal amount of the Term Loans then outstanding.
"SBA" has the meaning given to it in Section 7.15.
"SBIC" has the meaning given to it in Section 7.15.
"SBIC Act" has the meaning given to it in Section 7.15.
"SEC" means the Securities and Exchange Commission.
"Second Interest Only Extension Condition" means Borrower has requested and
Lender has advanced the Additional Advance pursuant to and in accordance with
this Agreement.
"Secured Obligations" means Borrower's obligations under this Agreement and any
Loan Document (other than the Warrants), including any obligation to pay any
amount now owing or later arising.
"Securities Act" means the Securities Act of 1933, as amended.
"Subordinated Indebtedness" means Indebtedness subordinated to the Secured
Obligations in amounts and on terms and conditions satisfactory to Agent in its
sole discretion.
"Subsidiary" means an entity, whether corporate, partnership, limited liability
company, joint venture or otherwise, in which Borrower owns or controls 50% or
more of the outstanding voting securities, including each entity listed on
Schedule 1 hereto.
"Term Commitment" means as to any Lender, the obligation of such Lender, if any,
to make a Term Loan Advance to Borrower in a principal amount not to exceed the
amount set forth under the heading "Term Commitment" opposite such Lender's name
on Schedule 1.1.
"Term Loan" has the meaning given to it in the Recitals.
"Term Loan Advance" means any Term Loan funds advanced under this Agreement.
"Term Loan Interest Rate" means for any day a per annum rate of interest equal
to the greater of (i) 6.00% plus the prime rate as reported in The Wall Street
Journal and (ii) 9.50%.
"Term Loan Maturity Date" means February 1, 2020.
"Term Note" means a Promissory Note in substantially the form of Exhibit B.
"Trademark License" means any written agreement granting any right to use any
Trademark or Trademark registration, now owned or hereafter acquired by Borrower
or in which Borrower now holds or hereafter acquires any interest.
"Trademarks" means all trademarks (registered, common law or otherwise) and any
applications in connection therewith, including registrations, recordings and
applications in the United States Patent and Trademark Office or in any similar
office or agency of the United States, any State thereof or any other country or
any political subdivision thereof.
"UCC" means the Uniform Commercial Code as the same is, from time to time, in
effect in the State of California; provided, that in the event that, by reason
of mandatory provisions of law, any or all of the attachment, perfection or
priority of, or remedies with respect to, Agent's Lien on any Collateral is
governed by the Uniform Commercial Code as the same is, from time to time, in
effect in a jurisdiction other than the State of California, then the term "UCC"
shall mean the Uniform Commercial Code as in effect, from time to time, in such
other jurisdiction solely for purposes of the provisions thereof relating to
such attachment, perfection, priority or remedies and for purposes of
definitions related to such provisions.
       "Warrants" means the warrants entered into in connection with the Loan,
as they may be amended, restated or modified from time to time.
 
Unless otherwise specified, all references in this Agreement or any Annex or
Schedule hereto to a "Section," "subsection," "Exhibit," "Annex," or "Schedule"
shall refer to the corresponding Section, subsection, Exhibit, Annex, or
Schedule in or to this Agreement.  Unless otherwise specifically provided
herein, any accounting term used in this Agreement or the other Loan Documents
shall have the meaning customarily given such term in accordance with GAAP, and
all financial computations hereunder shall be computed in accordance with GAAP,
consistently applied.  Unless otherwise defined herein or in the other Loan
Documents, terms that are used herein or in the other Loan Documents and defined
in the UCC shall have the meanings given to them in the UCC.
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SECTION 2.                                        THE LOAN
2.1            Term Loan.
(a)            Advances.  Subject to the terms and conditions of this Agreement,
Lender will severally (and not jointly) make in an amount not to exceed its
respective Term Commitment, and Borrower agrees to draw, a Term Loan Advance of
$25,000,000 on the Closing Date. During the Additional Term Loan Advance Period,
at Borrower's request, Lender shall advance an additional Term Loan Advance in
an amount equal to $15,000,000 (the "Additional Advance"). The aggregate
outstanding Term Loan Advances shall not exceed the Maximum Term Loan Amount.
(b)            Advance Request.  To obtain a Term Loan Advance, Borrower shall
complete, sign and deliver to Agent an Advance Request at least one (1) Business
Day before the Closing Date and at least three (3) Business Days before the
Advance Date other than the Closing Date.  Lender shall fund each Term Loan
Advance in the manner requested by the Advance Request; provided that each of
the conditions precedent to such Term Loan Advance is satisfied as of the
requested Advance Date.
(c)            Term Loan Interest Rate.  The principal balance of each Term Loan
Advance shall bear interest thereon from the applicable Advance Date at the Term
Loan Interest Rate based on a year consisting of 360 days, with interest
computed daily based on the actual number of days elapsed. The Term Loan
Interest Rate will be subject to change on the day the prime rate changes from
time to time.
(d)            Payment.  Borrower will pay interest on each Term Loan Advance on
the first Business Day of each month, beginning the month after the Advance
Date. Borrower shall repay the aggregate Term Loan principal balance that is
outstanding on the day immediately preceding the Amortization Date, in equal
monthly installments of principal and interest (mortgage style) beginning on the
Amortization Date and continuing on the first Business Day of each month
thereafter until the Secured Obligations (other than inchoate indemnity
obligations) are repaid. The entire Term Loan principal balance and all accrued
but unpaid interest hereunder, shall be due and payable on Term Loan Maturity
Date. Borrower shall make all payments under this Agreement without setoff,
recoupment or deduction and regardless of any counterclaim or defense. Lender
will initiate debit entries to Borrower's account as authorized on the ACH
Authorization on each payment date of all (i) periodic obligations payable to
Lender under each Term Advance and (ii) reasonable and documented out-of-pocket
legal fees and costs payable to Agent or Lender pursuant to Section 11.11 of
this Agreement, so long as Borrower has received prior written notice thereof.
2.2            Maximum Interest. Notwithstanding any provision in this Agreement
or any other Loan Document, it is the parties' intent not to contract for,
charge, pay or receive interest at a rate that is greater than the maximum rate
permissible by law that a court of competent jurisdiction shall deem applicable
hereto (which under the laws of the State of California shall be deemed to be
the laws relating to permissible rates of interest on commercial loans) (the
"Maximum Rate"). If a court of competent jurisdiction shall finally determine
that Borrower has actually paid to Lender an amount of interest in excess of the
amount that would have been payable if all of the Secured Obligations had at all
times borne interest at the Maximum Rate, then such excess interest actually
paid by Borrower shall be applied as follows: first, to the payment of the
Secured Obligations consisting of the outstanding principal; second, after all
principal is repaid, to the payment of Lender's accrued interest, costs,
expenses, professional fees as provided in this Agreement and any other Secured
Obligations; and third, after all Secured Obligations (other than any inchoate
indemnity obligations and any other obligations which, by their terms, are to
survive the termination of this Agreement) are repaid, the excess (if any) shall
be refunded to Borrower.
2.3            Default Interest.  In the event any payment is not paid on the
scheduled payment date, an amount equal to five percent (5%) of the past due
amount shall be payable on demand. In addition, upon the occurrence and during
the continuation of an Event of Default hereunder, all Secured Obligations,
including principal, interest, compounded interest, and professional fees, shall
bear interest at a rate per annum equal to the rate set forth in Section 2.1(c)
plus five percent (5%) per annum. In the event any interest is not paid when due
hereunder, delinquent interest shall be added to principal and shall bear
interest on interest, compounded at the rate set forth in Section 2.1(c) or this
Section 2.3, as applicable.
2.4            Prepayment.  At its option upon at least seven (7) Business Days
prior notice to Agent, Borrower may prepay all, but not less than all, of the
outstanding Advances by paying the entire principal balance, all accrued and
unpaid interest thereon, together with a prepayment charge equal to the
following percentage of the Advance amount being prepaid: if such Advance
amounts are prepaid in any of the first 12 months following the Closing Date,
3.00%; after 12 months but prior to 24 months following the Closing Date, 2.00%;
and thereafter, 1.00% (each, a "Prepayment Charge"). Borrower agrees that the
Prepayment Charge is a reasonable calculation of Lender's lost profits in view
of the difficulties and impracticality of determining actual damages resulting
from an early repayment of the Advances. Borrower shall prepay the outstanding
amount of all principal and accrued interest through the prepayment date and the
Prepayment Charge upon the occurrence of a Change in Control. Notwithstanding
the foregoing, Agent and Lender agree to waive the Prepayment Charge if Agent
and Lender (in its sole and absolute discretion) agree in writing to refinance
the Advances prior to the Maturity Date.
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2.5            End of Term Charge.  On the earliest to occur of (i) the Term
Loan Maturity Date, (ii) the date that Borrower prepays the outstanding Secured
Obligations (other than any inchoate indemnity obligations and any other
obligations which, by their terms, are to survive the termination of this
Agreement) in full, or (iii) the date that the Secured Obligations become due
and payable, Borrower shall pay Lender the End of Term Amount. Notwithstanding
the required payment date of such charge, it shall be deemed earned by Lender as
of the Closing Date.
2.6            Notes.  If so requested by Lender by written notice to Borrower,
then Borrower shall execute and deliver to Lender (and/or, if applicable and if
so specified in such notice, to any Person who is an assignee of Lender pursuant
to Section 11.13) promptly after Borrower's receipt of such notice a Note or
Notes to evidence Lender's Loans.
2.7            Pro Rata Treatment.  Each payment (including prepayment) on
account of any fee and any reduction of the Term Loans shall be made pro rata
according to the Term Commitments of the relevant Lender.
SECTION 3.                                        SECURITY INTEREST
3.1            As security for the prompt and complete payment when due (whether
on the payment dates or otherwise) of all the Secured Obligations, Borrower
grants to Agent a security interest in all of Borrower's right, title, and
interest in and to the following personal property whether now owned or
hereafter acquired (collectively, the "Collateral"): (a) Receivables;
(b) Equipment; (c) Fixtures; (d) General Intangibles (other than Intellectual
Property); (e) Inventory; (f) Investment Property; (g) Deposit Accounts;
(h) Cash; (i) Goods; and all other tangible and intangible personal property of
Borrower whether now or hereafter owned or existing, leased, consigned by or to,
or acquired by, Borrower and wherever located, and any of Borrower's property in
the possession or under the control of Agent; and, to the extent not otherwise
included, all Proceeds of each of the foregoing and all accessions to,
substitutions and replacements for, and rents, profits and products of each of
the foregoing;  provided, however, that the Collateral shall include all
Accounts and General Intangibles that consist of rights to payment and proceeds
from the sale, licensing or disposition of all or any part, or rights in, the
Intellectual Property (the "Rights to Payment"). Notwithstanding the foregoing,
if a judicial authority (including a U.S. Bankruptcy Court) holds that a
security interest in the underlying Intellectual Property is necessary to have a
security interest in the Rights to Payment, then the Collateral shall
automatically, and effective as of the date of this Agreement, include the
Intellectual Property to the extent necessary to permit perfection of Agent's
security interest in the Rights to Payment.
3.2            Notwithstanding the broad grant of the security interest set
forth in Section 3.1, above, the Collateral shall not include (a) more than 65%
of the presently existing and hereafter arising issued and outstanding shares of
capital stock owned by Borrower of any Foreign Subsidiary (other than an
Eligible Foreign Subsidiary) which shares entitle the holder thereof to  vote
for directors or any other matter, and (b) nonassignable licenses or contracts,
which by their terms require the consent of the licensor thereof or another
party (but only to the extent such prohibition on transfer is enforceable under
applicable law, including, without limitation, Sections 9406, 9407 and 9408 of
the UCC).
 
LSA-10

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SECTION 4.            CONDITIONS PRECEDENT TO LOAN
               The obligations of Lender to make the Loan hereunder are subject
to the satisfaction by Borrower of the following conditions:
        4.1            Initial Advance.  On or prior to the Closing Date,
Borrower shall have delivered to Agent the following:
(a)            executed copies of the Loan Documents (other than the Warrants,
which shall be an original), Account Control Agreements, a legal opinion of
Borrower's counsel, and all other documents and instruments reasonably required
by Agent to effectuate the transactions contemplated hereby or to create and
perfect the Liens of Agent with respect to all Collateral, in all cases in form
and substance reasonably acceptable to Agent;
(b)            certified copy of resolutions of Borrower's board of directors
evidencing approval of (i) the Loan and other transactions evidenced by the Loan
Documents; and (ii) the Warrants and transactions evidenced thereby;
(c)            certified copies of the Certificate of Incorporation and the
Bylaws, as amended through the Closing Date, of Borrower;
(d)            a certificate of good standing for Borrower from its state of
incorporation and similar certificates from all other jurisdictions in which it
does business and where the failure to be qualified would have a Material
Adverse Effect;
(e)            payment of the Facility Charge and reimbursement of Agent's and
Lender's current expenses reimbursable pursuant to this Agreement, which amounts
may be deducted from the initial Advance; and
(f)            such other documents as Agent may reasonably request or be
required by this Agreement, including (i) the development plan and timeline to
be delivered pursuant to the definition of Milestone and (ii) the Financial
Forecast.
4.2            All Advances.  On each Advance Date:
(a)            Agent shall have received an Advance Request for the relevant
Advance as required by Section 2.1(b), duly executed by Borrower's Chief
Executive Officer or Chief Financial Officer, and (ii) any other documents Agent
may reasonably request.
(b)            The representations and warranties set forth in this Agreement
shall be true and correct in all material respects on and as of the Advance Date
with the same effect as though made on and as of such date, except to the extent
such representations and warranties expressly relate to an earlier date.

(c)            Borrower shall be in compliance with all the terms and provisions
set forth herein and in each other Loan Document on its part to be observed or
performed, and at the time of and immediately after such Advance no Event of
Default shall have occurred and be continuing.
(d)            Each Advance Request shall be deemed to constitute a
representation and warranty by Borrower on the relevant Advance Date as to the
matters specified in paragraphs (b) and (c) of this Section 4.2 and as to the
matters set forth in the Advance Request.
4.3            No Default.  As of the Closing Date and each Advance Date, (i) no
fact or condition exists that would (or would, with the passage of time, the
giving of notice, or both) constitute an Event of Default and (ii) no event that
has had or could reasonably be expected to have a Material Adverse Effect has
occurred and is continuing.
LSA-11

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SECTION 5.                                        REPRESENTATIONS AND WARRANTIES
OF BORROWER
Borrower represents and warrants that:
5.1            Corporate Status.  Borrower is a corporation duly organized,
legally existing and in good standing under the laws of the State of Delaware,
and is duly qualified as a foreign corporation in all jurisdictions in which the
nature of its business or location of its properties require such qualifications
and where the failure to be qualified could reasonably be expected to have a
Material Adverse Effect. Borrower's present name, former names (if any),
locations, place of formation, tax identification number, organizational
identification number and other information are correctly set forth in
Exhibit C, as may be updated by Borrower in a written notice (including any
Compliance Certificate) provided to Agent after the Closing Date.
5.2            Collateral.  Borrower owns the Collateral and the Intellectual
Property, free of all Liens, except for Permitted Liens. Borrower has the power
and authority to grant to Agent a Lien in the Collateral as security for the
Secured Obligations.
5.3            Consents.  Borrower's execution, delivery and performance of this
Agreement and all other Loan Documents, and Borrower's execution of the
Warrants, (i) have been duly authorized by all necessary corporate action of
Borrower, (ii) will not result in the creation or imposition of any Lien upon
the Collateral, other than Permitted Liens and the Liens created by this
Agreement and the other Loan Documents, (iii) do not violate any provisions of
Borrower's Certificate or Articles of Incorporation (as applicable), bylaws, or
any, law, regulation, order, injunction, judgment, decree or writ to which
Borrower is subject and (iv) except as described on Schedule 5.3, do not violate
any contract or agreement or require the consent or approval of any other Person
which has not already been obtained. The individual or individuals executing the
Loan Documents and the Warrants are duly authorized to do so.
5.4            Material Adverse Effect.  No event that has had or could
reasonably be expected to have a Material Adverse Effect has occurred and is
continuing. Borrower is not aware of any event likely to occur that is
reasonably expected to result in a Material Adverse Effect.
5.5            Actions Before Governmental Authorities.  There are no actions,
suits or proceedings at law or in equity or by or before any governmental
authority now pending or, to the knowledge of Borrower, threatened against or
affecting Borrower or its property, that is reasonably expected to result in a
Material Adverse Effect.
 
5.7            Laws.  Borrower is not in violation of any law, rule or
regulation, or in default with respect to any judgment, writ, injunction or
decree of any governmental authority, where such violation or default is
reasonably expected to result in a Material Adverse Effect. Borrower is not in
default in any manner under any provision of any agreement or instrument
evidencing material Indebtedness, or any other material agreement to which it is
a party or by which it is bound. Borrower, its Affiliates and, to the knowledge
of Borrower and its Affiliates, any agent or other party acting on behalf of
Borrower or its Affiliates are in compliance with all applicable anti-money
laundering, economic sanctions and anti-bribery laws and regulations, and none
of the funds to be provided under this Agreement will be used, directly or
indirectly, for any activities in violation of such laws and regulations.
5.8            Information Correct and Current.  No information, report, Advance
Request, financial statement, exhibit or schedule furnished, by or on behalf of
Borrower to Agent in connection with any Loan Document or included therein or
delivered pursuant thereto contained, or, when taken as a whole, contains or
will contain any material misstatement of fact or, when taken together with all
other such information or documents, omitted, omits or will omit to state any
material fact necessary to make the statements therein, in the light of the
circumstances under which they were, are or will be made, not materially
misleading at the time such statement was made or deemed made. Additionally, any
and all financial or business projections provided by Borrower to Agent, whether
prior to or after the Closing Date, shall be (i) provided in good faith and
based on the most current data and information available to Borrower, and
(ii) the most current of such projections provided to Borrower's Board of
Directors (it being understood that such projections are subject to significant
uncertainties and contingencies, many of which are beyond the control of
Borrower, that no assurance is given that any particular projections will be
realized, and that actual results may differ).
5.9            Tax Matters.  Except as described on Schedule 5.8 and except
those being contested in good faith with adequate reserves under GAAP,
(a) Borrower has filed all material federal, state and local tax returns that it
is required to file, (b) Borrower has duly paid or fully reserved for all taxes
or installments thereof (including any interest or penalties) as and when due,
which have or may become due pursuant to such returns, and (c) Borrower has paid
or fully reserved for any tax assessment received by Borrower for the three (3)
years preceding the Closing Date, if any (including any taxes being contested in
good faith and by appropriate proceedings).
5.10            Intellectual Property Claims. Borrower is the sole owner of, or
otherwise has the right to use, the Intellectual Property material to Borrower's
business. Except as described on Schedule 5.9, (i) each of the material
Copyrights, Trademarks and Patents is valid and enforceable, (ii) no material
part of the Intellectual Property has been judged invalid or unenforceable, in
whole or in part, and (iii) no claim has been made to Borrower that any material
part of the Intellectual Property violates the rights of any third party.
Exhibit D is a true, correct and complete list of each of Borrower's Patents,
registered Trademarks, registered Copyrights, and material agreements under
which Borrower licenses Intellectual Property from third parties (other than
shrink-wrap software licenses), together with application or registration
numbers, as applicable, owned by Borrower or any Subsidiary, in each case as of
the Closing Date. Borrower is not in material breach of, nor has Borrower failed
to perform any material obligations under, any of the foregoing contracts,
licenses or agreements and, to Borrower's knowledge, no third party to any such
contract, license or agreement is in material breach thereof or has failed to
perform any material obligations thereunder.
5.11           Intellectual Property.  Except as described on Schedule 5.10,
Borrower has all material rights with respect to Intellectual Property necessary
or material in the operation or conduct of Borrower's business as currently
conducted and proposed to be conducted by Borrower. Without limiting the
generality of the foregoing, and in the case of Licenses, except for
restrictions that are unenforceable under Division 9 of the UCC, Borrower has
the right, to the extent required to operate Borrower's business, to freely
transfer, license or assign Intellectual Property necessary or material in the
operation or conduct of Borrower's business as currently conducted and proposed
to be conducted by Borrower, without condition, restriction or payment of any
kind (other than license payments in the ordinary course of business) to any
third party, and Borrower owns or has the right to use, pursuant to valid
licenses, all software development tools, library functions, compilers and all
other third-party software and other items that are material to Borrower's
business and used in the design, development, promotion, sale, license,
manufacture, import, export, use or distribution of Borrower Products except
customary covenants in inbound license agreements and equipment leases where
Borrower is the licensee or lessee.
      5.12            Borrower Products.  Except as described on Schedule 5.11,
no Intellectual Property owned by Borrower or Borrower Product has been or is
subject to any actual or, to the knowledge of Borrower, threatened litigation,
proceeding (including any proceeding in the United States Patent and Trademark
Office or any corresponding foreign office or agency) or outstanding decree,
order, judgment, settlement agreement or stipulation that restricts in any
manner Borrower's use, transfer or licensing thereof or that may affect the
validity, use or enforceability thereof. There is no decree, order, judgment,
agreement, stipulation, arbitral award or other provision entered into in
connection with any litigation or proceeding that obligates Borrower to grant
licenses or ownership interest in any future Intellectual Property related to
the operation or conduct of the business of Borrower or Borrower Products. 
Borrower has not received any written notice or claim, or, to the knowledge of
Borrower, oral notice or claim, challenging or questioning Borrower's ownership
in any Intellectual Property (or written notice of any claim challenging or
questioning the ownership in any licensed Intellectual Property of the owner
thereof) or suggesting that any third party has any claim of legal or beneficial
ownership with respect thereto nor, to Borrower's knowledge, is there a
reasonable basis for any such claim.  Neither Borrower's use of its Intellectual
Property nor the production and sale of Borrower Products infringes the
Intellectual Property or other rights of others.
 
5.13            Financial Accounts. Exhibit E, as may be updated by Borrower in
a written notice provided to Agent after the Closing Date, is a true, correct
and complete list of (a) all banks and other financial institutions at which
Borrower or any Subsidiary maintains Deposit Accounts, (b) all institutions at
which Borrower or any Subsidiary maintains an account holding Investment
Property and (c) the maturity dates and amounts in respect of each series of the
CDARS Amounts, and such exhibit correctly identifies the name, address and
telephone number of each bank or other institution, the name in which the
account is held, a description of the purpose of the account, and the complete
account number therefor.
 5.14    Employee Loans. Borrower has no outstanding loans to any employee,
officer or director of Borrower nor has Borrower guaranteed the payment of any
loan made to an employee, officer or director of Borrower by a third party.
5.15  Capitalization and Subsidiaries. Borrower's capitalization as of the
Closing Date is set forth on Schedule 5.14 annexed hereto. Borrower does not own
any stock, partnership interest or other securities of any Person, except for
Permitted Investments. Attached as Schedule 5.14, as may be updated by Borrower
in a written notice provided after the Closing Date, is a true, correct and
complete list of each Subsidiary.
 
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SECTION 6.                                                  INSURANCE;
INDEMNIFICATION
6.1            Coverage.  Borrower shall cause to be carried and maintained
commercial general liability insurance, on an occurrence form, against risks
customarily insured against in Borrower's line of business. Such risks shall
include the risks of bodily injury, including death, property damage, personal
injury, advertising injury, and contractual liability per the terms of the
indemnification agreement found in Section 6.3. Borrower must maintain a minimum
of $2,000,000 of commercial general liability insurance for each occurrence.
Borrower has and agrees to maintain a minimum of $2,000,000 of directors' and
officers' insurance for each occurrence and $5,000,000 in the aggregate. So long
as there are any Secured Obligations outstanding, Borrower shall also cause to
be carried and maintained insurance upon the Collateral, insuring against all
risks of physical loss or damage howsoever caused, in an amount not less than
the full replacement cost of the Collateral, provided that such insurance may be
subject to standard exceptions and deductibles.
6.2            Certificates.  Borrower shall deliver to Agent certificates of
insurance that evidence Borrower's compliance with its insurance obligations in
Section 6.1 and the obligations contained in this Section 6.2. Borrower's
insurance certificate shall state Agent is an additional insured for commercial
general liability, a loss payee for all risk property damage insurance, subject
to the insurer's approval, and a loss payee for property insurance and
additional insured for liability insurance for any future insurance that
Borrower may acquire from such insurer. Attached to the certificates of
insurance will be additional insured endorsements for liability and lender's
loss payable endorsements for all risk property damage insurance. All
certificates of insurance will provide for a minimum of 30 days' advance written
notice to Agent of cancellation (other than cancellation for non-payment of
premiums, for which 10 days' advance written notice shall be sufficient) or any
other change adverse to Agent's interests. Any failure of Agent to scrutinize
such insurance certificates for compliance is not a waiver of any of Agent's
rights, all of which are reserved.
6.3            Indemnity.  Borrower agrees to indemnify and hold Agent, Lender
and their officers, directors, employees, agents, in-house attorneys,
representatives and shareholders (each, an "Indemnified Person") harmless from
and against any and all claims, costs, expenses, damages and liabilities
(including such claims, costs, expenses, damages and liabilities based on
liability in tort, including strict liability in tort), including reasonable
attorneys' fees and disbursements and other costs of investigation or defense
(including those incurred upon any appeal) (collectively, "Liabilities"), that
may be instituted or asserted against or incurred by such Indemnified Person as
the result of credit having been extended, suspended or terminated under this
Agreement and the other Loan Documents or the administration of such credit, or
in connection with or arising out of the transactions contemplated hereunder and
thereunder, or any actions or failures to act in connection therewith, or
arising out of the disposition or utilization of the Collateral, excluding in
all cases Liabilities to the extent resulting solely from any Indemnified
Person's gross negligence or willful misconduct. Borrower agrees to pay, and to
save Agent and Lender harmless from, any and all liabilities with respect to, or
resulting from any delay in paying, any and all excise, sales or other similar
taxes (excluding taxes imposed on or measured by the net income of Agent or
Lender) that may be payable or determined to be payable with respect to any of
the Collateral or this Agreement. In no event shall any Indemnified Person be
liable on any theory of liability for any special, indirect, consequential or
punitive damages (including any loss of profits, business or anticipated
savings). This Section 6.3 shall survive the repayment of indebtedness under,
and otherwise shall survive the expiration or other termination of, this
Agreement.
LSA-13

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SECTION 7.                                        COVENANTS OF BORROWER
Borrower agrees as follows:
7.1            Financial Reports.  Borrower shall furnish to Agent the financial
statements and reports listed hereinafter (the "Financial Statements"):
(a)            as soon as practicable (and in any event within 30 days) after
the end of each month, unaudited interim financial statements as of the end of
each month that include a balance sheet and related statements of income (but
which may excluded adjustments for work in progress, adjustments for derivative
liabilities and expenses relating to stock options and warrants) accompanied by
a report detailing any material contingencies (including the commencement of any
material litigation by or against Borrower) or any other occurrence that would
reasonably be expected to have a Material Adverse Effect, all certified by
Borrower's Chief Executive Officer or Chief Financial Officer to the effect that
they have been prepared in accordance with GAAP, except (i) for the absence of
footnotes, (ii) that they are subject to normal year-end adjustments, and
(iii) they do not contain certain non-cash items that are customarily included
in quarterly and annual financial statements;
(b)            as soon as practicable (and in any event within 40 days) after
the end of each calendar  quarter, unaudited interim and year-to-date financial
statements as of the end of such calendar quarter (prepared on a consolidated
and consolidating basis, if applicable), including balance sheet and related
statements of income and cash flows accompanied by a report detailing any
material contingencies (including the commencement of any material litigation by
or against Borrower) or any other occurrence that would reasonably be expected
to have a Material Adverse Effect,  certified by Borrower's Chief Executive
Officer or Chief Financial Officer to the effect that they have been prepared in
accordance with GAAP, except (i) for the absence of footnotes, and (ii) that
they are subject to normal year-end adjustments; as well as the most recent
capitalization table for Borrower, including the weighted average exercise price
of employee stock options;

(c)            as soon as practicable (and in any event within 90 days) after
the end of each fiscal year, unqualified audited financial statements as of the
end of such year (prepared on a consolidated and consolidating basis, if
applicable), including balance sheet and related statements of income and cash
flows, and setting forth in comparative form the corresponding figures for the
preceding fiscal year, certified by a firm of independent certified public
accountants selected by Borrower and reasonably acceptable to Agent, accompanied
by any management report from such accountants;
(d)            as soon as practicable (and in any event within 30 days) after
the end of each month, a Compliance Certificate in the form of Exhibit F;
(e)            as soon as practicable (and in any event within ten (10) days)
after the end of each month, a report showing aging of accounts receivable and
accounts payable;
(f)            promptly after the sending or filing thereof, as the case may be,
copies of any proxy statements, financial statements or reports that Borrower
has made available to holders of its Common Stock and/or Preferred Stock and
copies of any regular, periodic and special reports or registration statements
that Borrower files with the Securities and Exchange Commission or any
governmental authority that may be substituted therefor, or any national
securities exchange;
(g)            at the same time and in the same manner as it gives to its
directors, copies of all notices, minutes, consents and other materials that
Borrower provides to its directors in connection with meetings of the Board of
Directors, and within 30 days after each such meeting, minutes of such meeting,
provided that in all cases Borrower may exclude confidential compensation
information; and
(h)            financial and business projections promptly following their
approval by Borrower's Board of Directors, and in any event, within 30 days
prior to the end of Borrower's fiscal year, as well as budgets, operating plans
and other financial information reasonably requested by Agent.
Borrower shall not (without the consent of Agent, such consent not to be
unreasonably withheld or delayed), (a) make any change in its (i) accounting
policies or reporting practices, except as permitted by GAAP or (ii) fiscal
years or fiscal quarters, or (b) change the end of its fiscal year.
Notwithstanding anything to the contrary in this Section 7.1, Borrower shall not
be required to deliver any financial statements to the Agent under clause (b) or
clause (c) above with respect to any period for which it has timely filed its
Form 10-K or Form 10-Q, as the case may be, with the SEC; provided that such
Form 10-K or Form 10-Q, as the case may be, is publicly available on the SEC's
website (or a similar website) within the time periods permitted by this Section
7.1 and Borrower promptly notifies Agent in writing (which may be by electronic
mail) of the posting of any such documents. To the extent any documents required
to be delivered pursuant to the terms hereof are included in materials otherwise
filed with the SEC, Borrower may deliver such documents by e-mailing to Agent a
link to the applicable filing posted on the SEC website currently located at
http://www.sec.gov.
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The executed Compliance Certificate may be sent via email to Agent at
legal@herculestech.com. The information required to be delivered pursuant to
clause (a) shall be sent via e-mail to financialstatements@herculestech.com with
a copy to legal@herculestech.com provided, that if e-mail is not available or
sending such Financial Statements via e-mail is not possible, they shall be sent
to Agent at: legal@herculestech.com, attention Chief Credit Officer.
 
7.2            Management Rights.  Borrower shall permit any representative that
Agent or Lender authorizes, including its attorneys and accountants, to inspect
the Collateral and examine and make copies and abstracts of the books of account
and records of Borrower at reasonable times and upon reasonable notice during
normal business hours; provided, however, that so long as no Event of Default
has occurred and is continuing, such examinations shall be limited to no more
than two per fiscal year. In addition, any such representative shall have the
right to meet with management and officers of Borrower to discuss such books of
account and records.  In addition, Agent or Lender shall be entitled at
reasonable times and intervals to consult with and advise the management and
officers of Borrower concerning significant business issues affecting Borrower.
Such consultations shall not unreasonably interfere with Borrower's business
operations. The parties intend that the rights granted Agent and Lender shall
constitute "management rights" within the meaning of 29 C.F.R.
Section 2510.3-101(d)(3)(ii), but that any advice, recommendations or
participation by Agent or Lender with respect to any business issues shall not
be deemed to give Agent or Lender, nor be deemed an exercise by Agent or Lender
of, control over Borrower's management or policies.
7.3            Further Assurances.  Borrower shall from time to time execute,
deliver and file, alone or with Agent, any financing statements, security
agreements, collateral assignments, notices, control agreements, or other
documents to perfect or give the highest priority to Agent's Lien on the
Collateral. Borrower shall from time to time procure any instruments or
documents as may be reasonably requested by Agent, and take all further action
that may be necessary, or that Agent may reasonably request, to perfect and
protect the Liens granted hereby and thereby. Without limitation of the
foregoing, following the Closing Date, Borrower hereby agrees that it shall use
commercially reasonable efforts to deliver to Agent a duly executed consent and
waiver, in form and substance reasonably acceptable to Agent, from the lessor of
Borrower's premises located at 11726 San Vicente Blvd., Suite 650, Los Angeles,
CA 90049.  In addition, and for such purposes only, Borrower hereby authorizes
Agent to execute and deliver on behalf of Borrower and to file such financing
statements (including an indication that the financing statement covers "all
assets or all personal property" of Borrower in accordance with Section 9-504 of
the UCC), collateral assignments, notices, control agreements, security
agreements and other documents without the signature of Borrower either in
Agent's name or in the name of Agent as Agent and attorney-in-fact for
Borrower.  Borrower shall protect and defend Borrower's title to the Collateral
and Agent's Lien thereon against all Persons claiming any interest adverse to
Borrower or Agent other than Permitted Liens.
7.4            Indebtedness.  Borrower shall not create, incur, assume,
guarantee or be or remain liable with respect to any Indebtedness, or permit any
Subsidiary so to do, other than Permitted Indebtedness, or prepay any
Indebtedness or take any actions which impose on Borrower an obligation to
prepay any Indebtedness, except for (a) the conversion of Indebtedness into
equity securities and the payment of cash in lieu of fractional shares in
connection with such conversion, (b) purchase money Indebtedness pursuant to its
then applicable payment schedule, (c) prepayment by any Subsidiary of
(i) inter-company Indebtedness owed by such Subsidiary to Borrower, or (ii) if
such Subsidiary is not a Borrower, intercompany Indebtedness owed by such
Subsidiary to another Subsidiary that is not a Borrower or (d) as otherwise
permitted hereunder or approved in writing by Agent.
7.5            Collateral.  Borrower shall at all times keep the Collateral, the
Intellectual Property and all other property and assets used in Borrower's
business or in which Borrower now or hereafter holds any interest free and clear
from any legal process or Liens whatsoever (except for Permitted Liens), and
shall give Agent prompt written notice of any legal process affecting the
Collateral, the Intellectual Property, such other property and assets, or any
Liens thereon, provided, however, that the Collateral and such other property
and assets may be subject to Permitted Liens except that there shall be no Liens
whatsoever on Intellectual Property.  Borrower shall not agree with any Person
other than Agent or Lender not to encumber its property. Borrower shall not
enter into or suffer to exist or become effective any agreement that prohibits
or limits the ability of any Borrower to create, incur, assume or suffer to
exist any Lien upon any of its Intellectual Property, whether now owned or
hereafter acquired, to secure its obligations under the Loan Documents to which
it is a party other than (a) this Agreement and the other Loan Documents,
(b) any agreements governing any purchase money Liens or capital lease
obligations otherwise permitted hereby (in which case, any prohibition or
limitation shall only be effective against the assets financed thereby) and
(c) customary restrictions on the assignment of leases, licenses and other
agreements. Borrower shall cause its Subsidiaries to protect and defend such
Subsidiary's title to its assets from and against all Persons claiming any
interest adverse to such Subsidiary, and Borrower shall cause its Subsidiaries
at all times to keep such Subsidiary's property and assets free and clear from
any legal process or Liens whatsoever (except for Permitted Liens, provided,
however, that there shall be no Liens whatsoever on Intellectual Property), and
shall give Agent prompt written notice of any legal process affecting such
Subsidiary's assets.
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7.6            Investments.  Borrower shall not directly or indirectly acquire
or own, or make any Investment in or to any Person, or permit any of its
Subsidiaries so to do, other than Permitted Investments.
7.7            Distributions.  Borrower shall not, and shall not allow any
Subsidiary to, (a) repurchase or redeem any class of stock or other equity
interest other than pursuant to employee, director or consultant repurchase
plans or other similar agreements; provided, however, in each case the
repurchase or redemption price does not exceed the original consideration paid
for such stock or equity interest, or (b) declare or pay any cash dividend or
make a cash distribution on any class of stock or other equity interest, except
that a Subsidiary may pay dividends or make distributions to Borrower, or
(c) lend money to any employees, officers or directors or guarantee the payment
of any such loans granted by a third party in excess of $100,000 in the
aggregate or (d) waive, release or forgive any Indebtedness owed by any
employees, officers or directors in excess of $100,000 in the aggregate.
7.8            Transfers.  Except for Permitted Transfers, Borrower shall not,
and shall not allow any Subsidiary to, voluntarily or involuntarily transfer,
sell, lease, license, lend or in any other manner convey any equitable,
beneficial or legal interest in any material portion of its assets.
       7.9            Mergers or Acquisitions.  Borrower shall not merge or
consolidate, or permit any of its Subsidiaries to merge or consolidate, with or
into any other business organization (other than mergers or consolidations of
(a) a Subsidiary which is not a Borrower into another Subsidiary or into
Borrower or (b) a Borrower into another Borrower), or acquire, or permit any of
its Subsidiaries to acquire, all or substantially all of the capital stock or
property of another Person.
 
      7.10            Taxes.  Borrower and its Subsidiaries shall pay when due
all material taxes, fees or other charges of any nature whatsoever (together
with any related interest or penalties) now or hereafter imposed or assessed
against Borrower, Agent, Lender or the Collateral or upon Borrower's ownership,
possession, use, operation or disposition thereof or upon Borrower's rents,
receipts or earnings arising therefrom.  Borrower shall file on or before the
due date therefor all personal property tax returns in respect of the
Collateral.  Notwithstanding the foregoing, Borrower may contest, in good faith
and by appropriate proceedings, taxes for which Borrower maintains adequate
reserves therefor in accordance with GAAP.
 
      7.11            Corporate Changes.  Neither Borrower nor any Subsidiary
shall change its corporate name, legal form or jurisdiction of formation without
20 days' prior written notice to Agent.  Neither Borrower nor any Subsidiary
shall suffer a Change in Control.  Neither Borrower nor any Subsidiary shall
relocate its chief executive office or its principal place of business unless:
(i) it has provided prior written notice to Agent; and (ii) such relocation
shall be within the continental United States.  Neither Borrower nor any
Qualified Subsidiary shall relocate any item of Collateral (other than (x) sales
of Inventory in the ordinary course of business, (y) relocations of Equipment
having an aggregate value of up to $150,000 in any fiscal year, and
(z) relocations of Collateral from a location described on Exhibit C to another
location described on Exhibit C) unless (i) it has provided prompt written
notice to Agent, (ii) such relocation is within the continental United States
and, (iii) if such relocation is to a third party bailee, it has delivered a
bailee agreement in form and substance reasonably acceptable to Agent.
 
LSA-16

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7.12            Deposit Accounts.
(a)            Neither Borrower nor any Qualified Subsidiary shall maintain any
Deposit Accounts, or accounts holding Investment Property, except with respect
to which Agent has an Account Control Agreement. The preceding sentence shall
not apply to any Deposit Accounts exclusively used for payroll, payroll taxes
and other employee wage and benefit payments to or for the benefit of Borrower's
employees; provided, however, for the avoidance of doubt, no portion of the cash
balance required to be maintained by Borrower pursuant to Section 7.16 shall be
held in any such account.
(b)            The requirement under the first sentence of Section 7.12(a) shall
not apply to (i) up to $250,000 in the aggregate in the specific accounts
maintained with CommerzBank as set forth on Exhibit E and (ii) the CDARS Amounts
through the maturity dates applicable thereto as set forth on Exhibit E;
provided that within two (2) Business Days following each maturity date
applicable to any portion of the CDARS Amounts (x) Borrower will deposit the
applicable CDARS Amounts into a Deposit Account covered by an Account Control
Agreement and (y) will terminate all accounts, contracts and arrangements
associated with the applicable CDARS Amounts. In no event shall Borrower amend
any contract or arrangement with respect to the CDARS Amounts or increase the
aggregate CDARS Amounts existing as of the Closing Date, and Borrower shall not
maintain any CDARS Amounts from and after March 31, 2016.
7.13            Domestic Subsidiaries. Borrower shall notify Agent of each
Domestic Subsidiary formed subsequent to the Closing Date and, within 15 days of
formation, shall cause any such Qualified Subsidiary to execute and deliver to
Agent a Joinder Agreement.
7.14            Notification of Event of Default.  Borrower shall notify Agent
immediately of the occurrence of any Event of Default.
7.15            SBIC Matters. The applicable Lender has received a license from
the U.S. Small Business Administration ("SBA") to extend loans as a small
business investment company ("SBIC") pursuant to the Small Business Investment
Act of 1958, as amended, and the associated regulations (collectively, the "SBIC
Act").  Portions of the loan to Borrower will be made under the SBA license and
the SBIC Act.  Addendum 1 to this Agreement outlines various responsibilities of
Agent, the applicable Lender and Borrower associated with an SBA loan, and such
Addendum 1 is hereby incorporated in this Agreement.
7.16            Financial Covenant. Borrower shall at all times maintain in one
or more U.S.-domiciled accounts in the name of Borrower and subject to an
Account Control Agreement (the "Qualified Accounts") an amount of unrestricted
cash required by Section 7.16(a) or Section 7.16(b), as applicable.
(a)            Prior to the date that Lender makes the Additional Advance,
Borrower shall maintain an amount of unrestricted cash in Qualified Accounts
equal to the greater of the following (such amount, the "Base Amount"): (i)
$10,000,000 and (ii) as measured on the first day of each month, the projected
amount of cash required by Borrower to operate its business for next three
months, as determined in accordance with the financial forecast agreed to by
Borrower and Agent, and delivered by Borrower to Agent, as of the Closing Date,
as such forecast may be updated from time-to-time with Agent's approval (the
"Financial Forecast").
(b)            On and after the date that Lender makes the Additional Advance,
Borrower shall maintain an amount of unrestricted cash in Qualified Accounts
equal to the greater of (i) $25,000,000 and (ii) as measured on the first day of
each month, the projected amount of cash required by Borrower to operate its
business for the next three months, as determined in accordance with the
Financial Forecast; provided that if (A) Borrower receives approval by the Food
and Drug Administration of aldoxorubicin for the treatment of soft tissue
sarcoma and (B) at the time such approval has been received from the Food and
Drug Administration Borrower has on-going clinical trials for a second novel
drug candidate, then Borrower shall maintain an amount of unrestricted cash in
Qualified Accounts equal to the Base Amount.
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SECTION 8.                                        RIGHT TO INVEST
Lender or its assignee or nominee shall have the right, in its discretion, to
purchase Borrower securities in one or more Equity Events; provided that (a)
Lender's right to purchase Borrower securities in one or more Equity Events
shall be limited in the aggregate to securities having an initial aggregate
purchase price of up to $2,000,000, and (b) such right shall be on the same
terms and conditions afforded to the other investors in the Equity Event. This
Section 8, and all rights and obligations hereunder, shall survive until the
later of (i) full exercise of each of the Warrants and (ii) termination of this
Agreement.
SECTION 9.                                        EVENTS OF DEFAULT
The occurrence of any one or more of the following events shall be an "Event of
Default":
9.1            Payments.  Borrower fails to pay any amount due under this
Agreement or any of the other Loan Documents on the due date; provided, however,
that an Event of Default shall not occur on account of a failure to pay due
solely to an administrative or operational error of Lender or Borrower's bank if
Borrower had the funds to make the payment when due and makes the payment within
three (3) Business Days following Borrower's knowledge of such failure to pay;
or
9.2            Covenants.  Borrower breaches or defaults in the performance of
any covenant or Secured Obligation under this Agreement, or any of the other
Loan Documents or any other agreement among Borrower, Agent and Lender, and
(a) with respect to a default under any covenant under this Agreement (other
than under Sections 6, 7.4, 7.5, 7.6, 7.7, 7.8, 7.9, 7.14, 7.15 and 7.16, any
other Loan Document or any other agreement among Borrower, Agent and Lender,
such default continues for more than 10 days after the earlier of the date on
which (i) Agent or Lender has given notice of such default to Borrower and
(ii) Borrower has actual knowledge of such default or (b) with respect to a
default under any of Sections 6, 7.4, 7.5, 7.6, 7.7, 7.8, 7.9, 7.14, 7.15 and
7.16, the occurrence of such default; or
9.3            Material Adverse Effect.  A circumstance has occurred that would
reasonably be expected to have a Material Adverse Effect; or
9.4            Representations.  Any representation or warranty made by Borrower
in any Loan Document or in the Warrants shall have been false or misleading in
any material respect when made or when deemed made; or
9.5            Insolvency.  Borrower (A) (i) shall make an assignment for the
benefit of creditors; or (ii) shall be unable to pay its debts as they become
due, or be unable to pay or perform under the Loan Documents, or shall become
insolvent; or (iii) shall file a voluntary petition in bankruptcy; or (iv) shall
file any petition, answer, or document seeking for itself any reorganization,
arrangement, composition, readjustment, liquidation, dissolution or similar
relief under any present or future statute, law or regulation pertinent to such
circumstances; or (v) shall seek or consent to or acquiesce in the appointment
of any trustee, receiver, or liquidator of Borrower or of all or any substantial
part (i.e., 33-1/3% or more) of the assets or property of Borrower; or
(vi) shall cease operations of its business as its business has normally been
conducted, or terminate substantially all of its employees; or (vii) Borrower or
its directors or majority shareholders shall take any action initiating any of
the foregoing actions described in clauses (i) through (vi); or (B) either
(i) 30 days shall have expired after the commencement of  an involuntary action
against Borrower seeking reorganization, arrangement, composition, readjustment,
liquidation, dissolution or similar relief under any present or future statute,
law or regulation, without such action being dismissed or all orders or
proceedings thereunder affecting the operations or the business of Borrower
being stayed; or (ii) a stay of any such order or proceedings shall thereafter
be set aside and the action setting it aside shall not be timely appealed; or
(iii) Borrower shall file any answer admitting or not contesting the material
allegations of a petition filed against Borrower in any such proceedings; or
(iv) the court in which such proceedings are pending shall enter a decree or
order granting the relief sought in any such proceedings; or (v) 30 days shall
have expired after the appointment, without the consent or acquiescence of
Borrower, of any trustee, receiver or liquidator of Borrower or of all or any
substantial part of the properties of Borrower without such appointment being
vacated; or
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9.6            Attachments; Judgments.  Any portion of Borrower's assets is
attached or seized, or a levy is filed against any such assets, or a judgment or
judgments is/are entered for the payment of money (not covered by independent
third party insurance as to which liability has not been rejected by such
insurance carrier), individually or in the aggregate, of at least $100,000, or
Borrower is enjoined or in any way prevented by court order from conducting any
part of its business; or
9.7            Other Obligations.  The occurrence of any default under any
agreement or obligation of Borrower involving any Indebtedness in excess of
$50,000.
9.8             Stop Trade.  At any time, an SEC stop trade order or NASDAQ
Capital Market trading suspension of the Common Stock shall be in effect for
five (5) consecutive days or five (5) days during a period of 10 consecutive
days, excluding in all cases a suspension of all trading on a public market,
provided that Borrower shall not have been able to cure such trading suspension
within 30 days of the notice thereof or list the Common Stock on another public
market within 60 days of such notice.
SECTION 10.                                        REMEDIES
10.1            General.  Upon and during the continuance of any one or more
Events of Default, (i) Agent may, at its option, accelerate and demand payment
of all or any part of the Secured Obligations together with a Prepayment Charge
and declare them to be immediately due and payable (provided, that upon the
occurrence of an Event of Default of the type described in Section 9.5, all of
the Secured Obligations shall automatically be accelerated and made due and
payable, in each case without any further notice or act), (ii) Agent may, at its
option, sign and file in Borrower's name any and all collateral assignments,
notices, control agreements, security agreements and other documents it deems
necessary or appropriate to perfect or protect the repayment of the Secured
Obligations, and in furtherance thereof, Borrower hereby grants Agent an
irrevocable power of attorney coupled with an interest, and (iii) Agent may
notify any of Borrower's account debtors to make payment directly to Agent,
compromise the amount of any such account on Borrower's behalf and endorse
Agent's name without recourse on any such payment for deposit directly to
Agent's account.  Agent may exercise all rights and remedies with respect to the
Collateral under the Loan Documents or otherwise available to it under the UCC
and other applicable law, including the right to release, hold, sell, lease,
liquidate, collect, realize upon, or otherwise dispose of all or any part of the
Collateral and the right to occupy, utilize, process and commingle the
Collateral.  All Agent's rights and remedies shall be cumulative and not
exclusive.
10.2            Collection;  Foreclosure.  Upon the occurrence and during the
continuance of any Event of Default, Agent may, at any time or from time to
time, apply, collect, liquidate, sell in one or more sales, lease or otherwise
dispose of, any or all of the Collateral, in its then condition or following any
commercially reasonable preparation or processing, in such order as Agent may
elect. Any such sale may be made either at public or private sale at its place
of business or elsewhere. Borrower agrees that any such public or private sale
may occur upon ten (10) calendar days' prior written notice to Borrower.  Agent
may require Borrower to assemble the Collateral and make it available to Agent
at a place designated by Agent that is reasonably convenient to Agent and
Borrower. The proceeds of any sale, disposition or other realization upon all or
any part of the Collateral shall be applied by Agent in the following order of
priorities:
First, to Agent and Lender in an amount sufficient to pay in full Agent's and
Lender's reasonable costs and professionals' and advisors' fees and expenses as
provided in Section 11.11;
Second, to Lender in an amount equal to the then unpaid amount of the Secured
Obligations (including principal, interest, and the Default Rate interest), in
such order and priority as Agent may choose in its sole discretion; and
Finally, after the full and final payment in Cash of all of the Secured
Obligations (other than inchoate obligations), to any creditor holding a junior
Lien on the Collateral, or to Borrower or its representatives or as a court of
competent jurisdiction may direct.
Agent shall be deemed to have acted reasonably in the custody, preservation and
disposition of any of the Collateral if it complies with the obligations of a
secured party under the UCC.
10.4            No Waiver.  Agent shall be under no obligation to marshal any of
the Collateral for the benefit of Borrower or any other Person, and Borrower
expressly waives all rights, if any, to require Agent to marshal any Collateral.
10.5            Cumulative Remedies.  The rights, powers and remedies of Agent
hereunder shall be in addition to all rights, powers and remedies given by
statute or rule of law and are cumulative.  The exercise of any one or more of
the rights, powers and remedies provided herein shall not be construed as a
waiver of or election of remedies with respect to any other rights, powers and
remedies of Agent.
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SECTION 11.                                        MISCELLANEOUS
11.1            Severability.  Whenever possible, each provision of this
Agreement shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement shall be prohibited by or
invalid under such law, such provision shall be ineffective only to the extent
and duration of such prohibition or invalidity, without invalidating the
remainder of such provision or the remaining provisions of this Agreement.

11.2            Notice.  Except as otherwise provided herein, any notice,
demand, request, consent, approval, declaration, service of process or other
communication (including the delivery of Financial Statements) that is required,
contemplated, or permitted under the Loan Documents or with respect to the
subject matter hereof shall be in writing, and shall be deemed to have been
validly served, given, delivered, and received upon the earlier of: (i) the day
of transmission by electronic mail or hand delivery or delivery by an overnight
express service or overnight mail delivery service; or (ii) the third calendar
day after deposit in the United States mails, with proper first class postage
prepaid, in each case addressed to the party to be notified as follows:
(a)
If to Agent:

HERCULES TECHNOLOGY GROWTH CAPITAL, INC.
Legal Department
Attention:  Chief Legal Officer and Anup Arora
400 Hamilton Avenue, Suite 310
Palo Alto, CA  94301
email: legal@herculestech.com; arora@herculestech.com
Telephone:  650-289-3060
(b)
If to Lender:

HERCULES TECHNOLOGY GROWTH CAPITAL, INC.
HERCULES TECHNOLOGY III, L.P.
Legal Department
Attention:  Chief Legal Officer and Anup Arora
400 Hamilton Avenue, Suite 310
Palo Alto, CA  94301
email: legal@herculestech.com; arora@herculestech.com
Telephone:  650-289-3060

(c)
If to Borrower:

CYTRX CORPORATION
Attention: John Y. Caloz
11726 San Vicente Blvd., Suite 650
Los Angeles, CA 90049
email: jcaloz@cytrx.com
Telephone: (310) 826-5648
or to such other address as each party may designate for itself by like notice.
LSA-20

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11.3            Entire Agreement; Amendments.
(a)            This Agreement and the other Loan Documents constitute the entire
agreement and understanding of the parties hereto in respect of the subject
matter hereof and thereof, and supersede and replace in their entirety any prior
proposals, term sheets, non-disclosure or confidentiality agreements, letters,
negotiations or other documents or agreements,
(b)            whether written or oral, with respect to the subject matter
hereof or thereof (including Agent's revised proposal letter dated January 13,
2016.
(c)            Neither this Agreement, any other Loan Document, nor any terms
hereof or thereof may be amended, supplemented or modified except in accordance
with the provisions of this Section 11.3(b). The Required Lenders and Borrower
party to the relevant Loan Document may, or, with the written consent of the
Required Lenders, Agent and Borrower party to the relevant Loan Document may,
from time to time, (i) enter into written amendments, supplements or
modifications hereto and to the other Loan Documents for the purpose of adding
any provisions to this Agreement or the other Loan Documents or changing in any
manner the rights of the Lenders or of Borrower hereunder or thereunder or
(ii) waive, on such terms and conditions as the Required Lenders or Agent, as
the case may be, may specify in such instrument, any of the requirements of this
Agreement or the other Loan Documents or any default or Event of Default and its
consequences; provided, however, that no such waiver and no such amendment,
supplement or modification shall (A) forgive the principal amount or extend the
final scheduled date of maturity of any Loan, extend the scheduled date of any
amortization payment in respect of any Term Loan, reduce the stated rate of any
interest or fee payable hereunder) or extend the scheduled date of any payment
thereof, or increase the amount or extend the expiration date of any Lender's
Revolving Commitment, in each case without the written consent of each Lender
directly affected thereby; (B) eliminate or reduce the voting rights of any
Lender under this Section 11.3(b) without the written consent of such Lender;
(C) reduce any percentage specified in the definition of Required Lenders,
consent to the assignment or transfer by Borrower of any of its rights and
obligations under this Agreement and the other Loan Documents, release all or
substantially all of the Collateral or release a Borrower from its obligations
under the Loan Documents, in each case without the written consent of all
Lenders; or (D) amend, modify or waive any provision of Section 11.17 without
the written consent of Agent. Any such waiver and any such amendment, supplement
or modification shall apply equally to each Lender and shall be binding upon
Borrower, the Lender, Agent and all future holders of the Loans.
11.4            No Strict Construction.  The parties hereto have participated
jointly in the negotiation and drafting of this Agreement. In the event an
ambiguity or question of intent or interpretation arises, this Agreement shall
be construed as if drafted jointly by the parties hereto and no presumption or
burden of proof shall arise favoring or disfavoring any party by virtue of the
authorship of any provisions of this Agreement.
11.5            No Waiver.  The powers conferred upon Agent and Lender by this
Agreement are solely to protect its rights hereunder and under the other Loan
Documents and its interest in the Collateral and shall not impose any duty upon
Agent or Lender to exercise any such powers. No omission or delay by Agent or
Lender at any time to enforce any right or remedy reserved to it, or to require
performance of any of the terms, covenants or provisions hereof by Borrower at
any time designated, shall be a waiver of any such right or remedy to which
Agent or Lender is entitled, nor shall it in any way affect the right of Agent
or Lender to enforce such provisions thereafter.
11.6            Survival.  All agreements, representations and warranties
contained in this Agreement and the other Loan Documents or in any document
delivered pursuant hereto or  thereto shall be for the benefit of Agent and
Lender and shall survive the execution and delivery of this Agreement and the
expiration or other termination of this Agreement.
11.7            Successors and Assigns.  The provisions of this Agreement and
the other Loan Documents shall inure to the benefit of and be binding on
Borrower and its permitted assigns (if any).  Borrower shall not assign its
obligations under this Agreement or any of the other Loan Documents without
Agent's express prior written consent, and any such attempted assignment shall
be void and of no effect. Agent and Lender may assign, transfer, or endorse its
rights hereunder and under the other Loan Documents without prior notice to
Borrower, and all of such rights shall inure to the benefit of Agent's and
Lender's successors and assigns; provided that as long as no Event of Default
has occurred and is continuing, neither Agent nor any Lender may assign,
transfer or endorse its rights hereunder or under the Loan Documents to any
party that is a direct competitor of Borrower (as reasonably determined by
Agent), it being acknowledged that in all cases, any transfer to an Affiliate of
any Lender or Agent shall be allowed.
11.8            Governing Law.  This Agreement and the other Loan Documents have
been negotiated and delivered to Agent and Lender in the State of California,
and shall have been accepted by Agent and Lender in the State of California.
Payment to Agent and Lender by Borrower of the Secured Obligations is due in the
State of California.  This Agreement and the other Loan Documents shall be
governed by, and construed and enforced in accordance with, the laws of the
State of California, excluding conflict of laws principles that would cause the
application of laws of any other jurisdiction.
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11.9                          Consent to Jurisdiction and Venue.  All judicial
proceedings (to the extent that the reference requirement of Section 11.10 is
not applicable) arising in or under or related to this Agreement or any of the
other Loan Documents may be brought in any state or federal court located in the
State of California. By execution and delivery of this Agreement, each party
hereto generally and unconditionally: (a) consents to nonexclusive personal
jurisdiction in Santa Clara County, State of California; (b) waives any
objection as to jurisdiction or venue in Santa Clara County, State of
California; (c) agrees not to assert any defense based on lack of jurisdiction
or venue in the aforesaid courts; and (d) irrevocably agrees to be bound by any
judgment rendered thereby in connection with this Agreement or the other Loan
Documents.  Service of process on any party hereto in any action arising out of
or relating to this Agreement shall be effective if given in accordance with the
requirements for notice set forth in Section 11.2, and shall be deemed effective
and received as set forth in Section 11.2. Nothing herein shall affect the right
to serve process in any other manner permitted by law or shall limit the right
of either party to bring proceedings in the courts of any other jurisdiction.
11.10                          Mutual Waiver of Jury Trial / Judicial Reference.
(a)            Because disputes arising in connection with complex financial
transactions are most quickly and economically resolved by an experienced and
expert Person and the parties wish applicable state and federal laws to apply
(rather than arbitration rules), the parties desire that their disputes be
resolved by a judge applying such applicable laws.  EACH OF BORROWER, AGENT AND
LENDER SPECIFICALLY WAIVES ANY RIGHT IT MAY HAVE TO TRIAL BY JURY OF ANY CAUSE
OF ACTION, CLAIM, CROSS-CLAIM, COUNTERCLAIM, THIRD PARTY CLAIM OR ANY OTHER
CLAIM (COLLECTIVELY, "CLAIMS") ASSERTED BY BORROWER AGAINST AGENT, LENDER OR
THEIR RESPECTIVE ASSIGNEE OR BY AGENT, LENDER OR THEIR RESPECTIVE ASSIGNEE
AGAINST BORROWER.  This waiver extends to all such Claims, including Claims that
involve Persons other than Agent, Borrower and Lender; Claims that arise out of
or are in any way connected to the relationship among Borrower, Agent and
Lender; and any Claims for damages, breach of contract, tort, specific
performance, or any equitable or legal relief of any kind, arising out of this
Agreement, any other Loan Document.
(b)            If the waiver of jury trial set forth in Section 11.10(a) is
ineffective or unenforceable, the parties agree that all Claims shall be
resolved by reference to a private judge sitting without a jury, pursuant to
Code of Civil Procedure Section 638, before a mutually acceptable referee or, if
the parties cannot agree, a referee selected by the Presiding Judge of the Santa
Clara County, California.  Such proceeding shall be conducted in Santa Clara
County, California, with California rules of evidence and discovery applicable
to such proceeding.
(c)            In the event Claims are to be resolved by judicial reference,
either party may seek from a court identified in Section 11.9, any prejudgment
order, writ or other relief and have such prejudgment order, writ or other
relief enforced to the fullest extent permitted by law notwithstanding that all
Claims are otherwise subject to resolution by judicial reference.
11.11                          Professional Fees.  Borrower promises to pay
Agent's and Lender's out-of-pocket fees and expenses, as well as any internal
fees and expenses incurred by Agent in substitution of (and not in addition to)
fees that would have been charged for work typically performed by outside
counsel, necessary to finalize the loan documentation, including but not limited
to reasonable attorneys' fees, UCC searches, filing costs, and other
miscellaneous expenses.  In addition, Borrower promises to pay any and all
reasonable attorneys' and other professionals' fees and expenses incurred by
Agent and Lender after the Closing Date in connection with or related to: 
(a) the Loan; (b) the administration, collection, or enforcement of the Loan;
(c) the amendment or modification of the Loan Documents; (d) any waiver,
consent, release, or termination under the Loan Documents; (e) the protection,
preservation, audit, field exam, sale, lease, liquidation, or disposition of
Collateral or the exercise of remedies with respect to the Collateral; (f) any
legal, litigation, administrative, arbitration, or out of court proceeding in
connection with or related to Borrower or the Collateral, and any appeal or
review thereof; and (g) any bankruptcy, restructuring, reorganization,
assignment for the benefit of creditors, workout, foreclosure, or other action
related to Borrower, the Collateral, the Loan Documents, including representing
Agent or Lender in any adversary proceeding or contested matter commenced or
continued by or on behalf of Borrower's estate, and any appeal or review
thereof.
11.12         Confidentiality. Agent and Lender acknowledge that certain items
of Collateral and information provided to Agent and Lender by Borrower are
confidential and proprietary information of Borrower, if and to the extent such
information either (x) is marked as confidential by Borrower at the time of
disclosure, or (y) should reasonably be understood to be confidential (the
"Confidential Information"). Accordingly, Agent and Lender agree that any
Confidential Information it may obtain in the course of acquiring,
administering, or perfecting Agent's security interest in the Collateral shall
not be disclosed to any other Person or entity in any manner whatsoever, in
whole or in part, without the prior written consent of Borrower,   except that
Agent and Lender may disclose any such information:  (a) to its own directors,
officers, employees, accountants, counsel and other professional advisors and to
its Affiliates if Agent or Lender in their sole discretion determines that any
such party should have access to such information in connection with such
party's responsibilities in connection with the Loan or this Agreement and,
provided that such recipient of such Confidential Information either (i) agrees
to be bound by the confidentiality provisions of this paragraph or (ii) is
otherwise subject to confidentiality restrictions that reasonably protect
against the disclosure of Confidential Information; (b) if such information is
generally available to the public; (c) if required or appropriate in any report,
statement or testimony submitted to any governmental authority having or
claiming to have jurisdiction over Agent or Lender; (d) if required or
appropriate in response to any summons or subpoena or in connection with any
litigation, to the extent permitted or deemed advisable by Agent's or Lender's
counsel; (e) to comply with any legal requirement or law applicable to Agent or
Lender; (f) to the extent reasonably necessary in connection with the exercise
of any right or remedy under any Loan Document, including Agent's sale, lease,
or other disposition of Collateral after default; (g) to any participant or
assignee of Agent or Lender or any prospective participant or assignee;
provided, that such participant or assignee or prospective participant or
assignee agrees in writing to be bound by this Section prior to disclosure; or
(h) otherwise with the prior consent of Borrower; provided, that any disclosure
made in violation of this Agreement shall not affect the obligations of Borrower
or any of its Affiliates or any guarantor under this Agreement or the other Loan
Documents.
LSA-22

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11.13                         Assignment of Rights.  Borrower acknowledges and
understands that Agent or Lender may, subject to Section 11.7, sell and assign
all or part of its interest hereunder and under the Loan Documents to any Person
or entity (an "Assignee").  After such assignment the term "Agent" or "Lender"
as used in the Loan Documents shall mean and include such Assignee, and such
Assignee shall be vested with all rights, powers and remedies of Agent and
Lender hereunder with respect to the interest so assigned; but with respect to
any such interest not so transferred, Agent and Lender shall retain all rights,
powers and remedies hereby given.  No such assignment by Agent or Lender shall
relieve Borrower of any of its obligations hereunder.  Lender agrees that in the
event of any transfer by it of the Note(s) (if any), it will endorse thereon a
notation as to the portion of the principal of the Note(s), which shall have
been paid at the time of such transfer and as to the date to which interest
shall have been last paid thereon.
11.14                          Revival of Secured Obligations.  This Agreement
and the Loan Documents shall remain in full force and effect and continue to be
effective if any petition is filed by or against Borrower for liquidation or
reorganization, if Borrower becomes insolvent or makes an assignment for the
benefit of creditors, if a receiver or trustee is appointed for all or any
significant part of Borrower's assets, or if any payment or transfer of
Collateral is recovered from Agent or Lender.  The Loan Documents and the
Secured Obligations and Collateral security shall continue to be effective, or
shall be revived or reinstated, as the case may be, if at any time payment and
performance of the Secured Obligations or any transfer of Collateral to Agent,
or any part thereof is rescinded, avoided or avoidable, reduced in amount, or
must otherwise be restored or returned by, or is recovered from, Agent, Lender
or by any obligee of the Secured Obligations, whether as a "voidable
preference," "fraudulent conveyance," or otherwise, all as though such payment,
performance, or transfer of Collateral had not been made.  In the event that any
payment, or any part thereof, is rescinded, reduced, avoided, avoidable,
restored, returned, or recovered, the Loan Documents and the Secured Obligations
shall be deemed, without any further action or documentation, to have been
revived and reinstated except to the extent of the full, final, and indefeasible
payment to Agent or Lender in Cash.
11.15                          Counterparts.  This Agreement and any amendments,
waivers, consents or supplements hereto may be executed in any number of
counterparts, and by different parties hereto in separate counterparts, each of
which when so delivered shall be deemed an original, but all of which
counterparts shall constitute but one and the same instrument.
11.16                          No Third Party Beneficiaries.  No provisions of
the Loan Documents are intended, nor will be interpreted, to provide or create
any third-party beneficiary rights or any other rights of any kind in any Person
other than Agent, Lender and Borrower unless specifically provided otherwise
herein, and, except as otherwise so provided, all provisions of the Loan
Documents will be personal and solely among Agent, the Lender and Borrower.
11.17                          Agency.
(a)            Lender hereby irrevocably appoints Hercules Technology Growth
Capital, Inc. to act on its behalf as Agent hereunder and under the other Loan
Documents and authorizes Agent to take such actions on its behalf and to
exercise such powers as are delegated to Agent by the terms hereof or thereof,
together with such actions and powers as are reasonably incidental thereto.
(b)            Lender  agrees to indemnify Agent in its capacity as such (to the
extent not reimbursed by Borrower and without limiting the obligation of
Borrower to do so), according to its respective Revolving Commitment and Term
Commitment percentages (based upon the total outstanding Revolving Commitment
and Term Loan Commitments) in effect on the date on which indemnification is
sought under this Section 11.17, from and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind whatsoever that may at any time be imposed
on, incurred by or asserted against Agent in any way relating to or arising out
of, this Agreement, any of the other Loan Documents or any documents
contemplated by or referred to herein or therein or the transactions
contemplated hereby or thereby or any action taken or omitted by Agent under or
in connection with any of the foregoing; The agreements in this section shall
survive the payment of the Loans and all other amounts payable hereunder.
(c)            Agent in Its Individual Capacity.  The Person serving as Agent
hereunder shall have the same rights and powers in its capacity as a Lender as
any other Lender and may exercise the same as though it were not Agent and the
term "Lender" shall, unless otherwise expressly indicated or unless the context
otherwise requires, include each such Person serving as Agent hereunder in its
individual capacity.
(d)            Exculpatory Provisions.  Agent shall have no duties or
obligations except those expressly set forth herein and in the other Loan
Documents.  Without limiting the generality of the foregoing, Agent shall not:
(i)            be subject to any fiduciary or other implied duties, regardless
of whether any default or any Event of Default has occurred and is continuing;
(ii)            have any duty to take any discretionary action or exercise any
discretionary powers, except discretionary rights and powers expressly
contemplated hereby or by the other Loan Documents that Agent is required to
exercise as directed in writing by the Lender, provided that Agent shall not be
required to take any action that, in its opinion or the opinion of its counsel,
may expose Agent to liability or that is contrary to any Loan Document or
applicable law; and
(iii)            except as expressly set forth herein and in the other Loan
Documents, have any duty to disclose, and Agent shall not be liable for the
failure to disclose, any information relating to Borrower or any of its
Affiliates that is communicated to or obtained by any Person serving as Agent or
any of its Affiliates in any capacity.
(e)            Agent shall not be liable for any action taken or not taken by it
(i) with the consent or at the request of the Lender or as Agent shall believe
in good faith shall be necessary, under the circumstances or (ii) in the absence
of its own gross negligence or willful misconduct.
(f)            Agent shall not be responsible for or have any duty to ascertain
or inquire into (i) any statement, warranty or representation made in or in
connection with this Agreement or any other Loan Document, (ii) the contents of
any certificate, report or other document delivered hereunder or thereunder or
in connection herewith or therewith, (iii) the performance or observance of any
of the covenants, agreements or other terms or conditions set forth herein or
therein or the occurrence of any default or Event of Default, (iv) the validity,
enforceability, effectiveness or genuineness of this Agreement, any other Loan
Document or any other agreement, instrument or document or (v) the satisfaction
of any condition set forth in Section 4 or elsewhere herein, other than to
confirm receipt of items expressly required to be delivered to Agent.
(g)            Reliance by Agent.  Agent may rely, and shall be fully protected
in acting, or refraining to act, upon, any resolution, statement, certificate,
instrument, opinion, report, notice, request, consent, order, bond or other
paper or document that it has no reason to believe to be other than genuine and
to have been signed or presented by the proper party or parties or, in the case
of cables, telecopies and telexes, to have been sent by the proper party or
parties.  In the absence of its gross negligence or willful misconduct, Agent
may conclusively rely, as to the truth of the statements and the correctness of
the opinions expressed therein, upon any certificates or opinions furnished to
Agent and conforming to the requirements of the Loan Agreement or any of the
other Loan Documents.  Agent may consult with counsel, and any opinion or legal
advice of such counsel shall be full and complete authorization and protection
in respect of any action taken, not taken or suffered by Agent hereunder or
under any Loan Documents in accordance therewith.  Agent shall have the right at
any time to seek instructions concerning the administration of the Collateral
from any court of competent jurisdiction.  Agent shall not be under any
obligation to exercise any of the rights or powers granted to Agent by this
Agreement, the Loan Agreement and the other Loan Documents at the request or
direction of Lenders unless Agent shall have been provided by Lender with
adequate security and indemnity against the costs, expenses and liabilities that
may be incurred by it in compliance with such request or direction.
11.18                         Publicity.  None of the parties hereto nor any of
its respective member businesses and Affiliates shall, without the other
parties' prior written consent (which shall not be unreasonably withheld or
delayed), publicize or use (a) the other party's name (including a brief
description of the relationship among the parties hereto), logo or hyperlink to
such other parties' web site, separately or together, in written and oral
presentations, advertising, promotional and marketing materials, client lists,
public relations materials or on its web site (together, the "Publicity
Materials"); (b) the names of officers of such other parties in the Publicity
Materials; and (c) such other parties' name, trademarks, servicemarks in any
news or press release concerning such party; provided however, notwithstanding
anything to the contrary herein, no such consent shall be required (i) to the
extent necessary to comply with the requests of any regulators, legal
requirements or laws applicable to such party, including the Securities Exchange
Act of 1934, as amended, and the 1933 Act, or pursuant to any listing agreement
with any national securities exchange (so long as such party provides prior
notice to the other party hereto to the extent reasonably practicable) and (ii)
to comply with Section 11.12.
(SIGNATURES TO FOLLOW)

LSA-23

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IN WITNESS WHEREOF, Borrower, Agent and Lender have duly executed and delivered
this Loan and Security Agreement as of the day and year first above written.
BORROWER:
CYTRX CORPORATION
Signature: /s/ STEVEN A. KRIEGSMAN
Name:                          Steven A. Kriegsman  
Title:                          Chairman and Chief Executive  Officer
Accepted in Palo Alto, California:
AGENT:
HERCULES TECHNOLOGY GROWTH CAPITAL, INC.
Signature:                          /s/ BEN BANG
Print Name:                  Ben Bang
Title:                                        Associate General Counsel
 
LENDER:
HERCULES TECHNOLOGY GROWTH CAPITAL, INC.
Signature:                          /s/ BEN BANG
Print Name:                 Ben Bang
Title:                                        Associate General Counsel

HERCULES TECHNOLOGY III, L.P.,
a Delaware limited partnership

By: Hercules Technology SBIC Management, LLC, its General Partner

By: Hercules Technology Growth
Capital, Inc., its Manager

Signature:                          /s/ BEN BANG
Print Name:                  Ben Bang
Title:                                        Associate General Counsel
LSA-24

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Table of Addenda, Exhibits and Schedules
Addendum 1
SBA Provisions
Exhibit A
Advance Request; Attachment to Advance Request
Exhibit B
Term Note
 
Exhibit C
Name, Locations, and Other Information for Borrower
 
Exhibit D
Borrower's Patents, Trademarks, Copyrights and Licenses
Exhibit E
Borrower's Deposit Accounts and Investment Accounts; CDARS Amounts
Exhibit F
Compliance Certificate
Exhibit G
Joinder Agreement
Exhibit H:
ACH Debit Authorization Agreement
Schedule 1
Subsidiaries
Schedule 1.1
Commitments
Schedule 1A
Existing Permitted Indebtedness
Schedule 1B
Investments
Schedule 1C
Existing Permitted Liens
Schedule 5.3
Consents, Etc.
Schedule 5.8
Tax Matters
Schedule 5.9
Intellectual Property Claims
Schedule 5.10
Intellectual Property
Schedule 5.11
Borrower Products
Schedule 5.14
Capitalization

 
LSA-25

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ADDENDUM 1 to LOAN AND SECURITY AGREEMENT
(a)            Borrower's Business.  For purposes of this Addendum 1, Borrower
shall be deemed to include its "affiliates" as defined in Title 13 Code of
Federal Regulations Section 121.103.  Borrower represents and warrants to Agent
and Lender as of the Closing Date and covenants to Agent and Lender for a period
of one year after the Closing Date with respect to subsections 2, 3, 4, 5, 6 and
7 below, as follows:
1.
Size Status.  Borrower's primary NAICS code is 541711 and has less than 30
employees in the aggregate;

2.
No Relender.  Borrower's primary business activity does not involve, directly or
indirectly, providing funds to others, purchasing debt obligations, factoring,
or long-term leasing of equipment with no provision for maintenance or repair;

3.
No Passive Business.  Borrower is engaged in a regular and continuous business
operation (excluding the mere receipt of payments such as dividends, rents,
lease payments, or royalties).  Borrower's employees are carrying on the
majority of day to day operations.  Borrower will not pass through substantially
all of the proceeds of the Loan to another entity;

4.
No Real Estate Business.  Borrower is not classified under Major Group 65 (Real
Estate) or Industry No. 1531 (Operative Builders) of the SIC Manual.  The
proceeds of the Loan will not be used to acquire or refinance real property
unless Borrower (x) is acquiring an existing property and will use at least 51
percent of the usable square footage for its business purposes; (y) is building
or renovating a building and will use at least 67 percent of the usable square
footage for its business purposes; or (z) occupies the subject property and uses
at least 67 percent of the usable square footage for its business purposes.

5.
No Project Finance.  Borrower's assets are not intended to be reduced or
consumed, generally without replacement, as the life of its business progresses,
and the nature of Borrower's business does not require that a stream of cash
payments be made to the business's financing sources, on a basis associated with
the continuing sale of assets (e.g., real estate development projects and oil
and gas wells).  The primary purpose of the Loan is not to fund production of a
single item or defined limited number of items, generally over a defined
production period, where such production will constitute the majority of the
activities of Borrower (e.g., motion pictures and electric generating plants).

6.
No Farm Land Purchases.  Borrower will not use the proceeds of the Loan to
acquire farm land which is or is intended to be used for agricultural or
forestry purposes, such as the production of food, fiber, or wood, or is so
taxed or zoned.

7.
No Foreign Investment.  The proceeds of the Loan will not be used substantially
for a foreign operation.  At the time of the Loan, Borrower will not have more
than 49 percent of its employees or tangible assets located outside the United
States.  The representation in this subsection (7) is made only as of the date
hereof and shall not continue for one year as contemplated in the first sentence
of this Section 1.

(b)            Small Business Administration Documentation.  Agent and Lender
acknowledge that Borrower completed, executed and delivered to Agent SBA Forms
480, 652 and 1031 (Parts A and B) together with a business plan showing
Borrower's financial projections (including balance sheets and income and cash
flows statements) for the period described therein and a written statement
(whether included in the purchase agreement or pursuant to a separate statement)
from Agent regarding its intended use of proceeds from the sale of securities to
Lender (the "Use of Proceeds Statement").  Borrower represents and warrants to
Agent and Lender that the information regarding Borrower and its affiliates set
forth in the SBA Form 480, Form 652 and Form 1031 and the Use of Proceeds
Statement delivered as of the Closing Date is accurate and complete.
(c)            Inspection.  The following covenants contained in this
Section (c) are intended to supplement and not to restrict the related
provisions of the Loan Documents.  Subject to the preceding sentence, Borrower
will permit, for so long as Lender holds any debt or equity securities of
Borrower, Agent, Lender or their representative, at Agent's or Lender' expense,
and examiners of the SBA to visit and inspect the properties and assets of
Borrower, to examine its books of account and records, and to discuss Borrower's
affairs, finances and accounts with Borrower's officers, senior management and
accountants, all at such reasonable times as may be requested by Agent or Lender
or the SBA.
(d)            Annual Assessment.  Promptly after the end of each calendar year
(but in any event prior to February 28 of each year) and at such other times as
may be reasonably requested by Agent or Lender, Borrower will deliver to Agent a
written assessment of the economic impact of Lender's investment in Borrower,
specifying the full-time equivalent jobs created or retained in connection with
the investment, the impact of the investment on the businesses of Borrower in
terms of expanded revenue and taxes, other economic benefits resulting from the
investment (such as technology development or commercialization, minority
business development, or expansion of exports) and such other information as may
be required regarding Borrower in connection with the filing of Lender's SBA
Form 468.   Lender will assist Borrower with preparing such assessment.  In
addition to any other rights granted hereunder, Borrower will grant Agent and
Lender and the SBA access to Borrower's books and records for the purpose of
verifying the use of such proceeds.  Borrower also will furnish or cause to be
furnished to Agent and Lender such other information regarding the business,
affairs and condition of Borrower as Agent or Lender may from time to time
reasonably request.
(e)            Use of Proceeds.  Borrower will use the proceeds from the Loan
only for sound business purposes in accordance with the applicable portions of
the SBIC Act. Borrower will deliver to Agent from time to time promptly
following Agent's request, a written report, certified as correct by Borrower's
Chief Financial Officer, verifying the purposes and amounts for which proceeds
from the Loan have been disbursed.  Borrower will supply to Agent such
additional information and documents as Agent reasonably requests with respect
to its use of proceeds and will permit Agent and Lender and the SBA to have
access to any and all Borrower records and information and personnel as Agent
deems necessary to verify how such proceeds have been or are being used, and to
assure that the proceeds have been used for the purposes specified above.
(f)            Activities and Proceeds.  Neither Borrower nor any of its
affiliates (if any) will engage in any activities or use directly or indirectly
the proceeds from the Loan for any purpose for which a small business investment
company is prohibited from providing funds by the SBIC Act, including 13 C.F.R.
§107.720.  Without obtaining the prior written approval of Agent, Borrower will
not change within 1 year of the date hereof, Borrower's current business
activity to a business activity which a licensee under the SBIC Act is
prohibited from providing funds by the SBIC Act.
(g)            Redemption Provisions.  Notwithstanding any provision to the
contrary contained in the Certificate of Incorporation of Borrower, as amended
from time to time (the "Charter"), if, pursuant to the redemption provisions
contained in the Charter, Lender is entitled to a redemption of its Warrant,
such redemption (in the case of Lender) will be at a price equal to the
redemption price set forth in the Charter (the "Existing Redemption Price"). 
If, however, Lender delivers written notice to Borrower that the then current
regulations promulgated under the SBIC Act prohibit payment of the Existing
Redemption Price in the case of an SBIC (or, if applied, the Existing Redemption
Price would cause the Common Stock to lose its classification as an "equity
security" and Lender has determined that such classification is unadvisable),
the amount Lender will be entitled to receive shall be the greater of (i) fair
market value of the securities being redeemed taking into account the rights and
preferences of such securities plus any costs and expenses of the Lender
incurred in making or maintaining the Warrant, and (ii) the Existing Redemption
Price where the amount of accrued but unpaid dividends payable to the Lender is
limited to Borrower's earnings plus any costs and expenses of the Lender
incurred in making or maintaining the Warrant; provided, however, the amount
calculated in subsections (i) or (ii) above shall not exceed the Existing
Redemption Price.
(h)            Compliance and Resolution.   Borrower agrees that a failure to
comply with Borrower's obligations under this Addendum, or any other set of
facts or circumstances where it has been asserted by any governmental regulatory
agency (or Agent or Lender believes that there is a substantial risk of such
assertion) that Agent, Lender and their affiliates are not entitled to hold, or
exercise any significant right with respect to, any securities issued to Lender
by Borrower, will constitute a breach of the obligations of Borrower under the
financing agreements among Borrower, Agent and Lender.  In the event of (i) a
failure to comply with Borrower's obligations under this Addendum; or (ii) an
assertion by any governmental regulatory agency (or Agent or Lender believes
that there is a substantial risk of such assertion) of a failure to comply with
Borrower's obligations under this Addendum, then (x) Agent, Lender and Borrower
will meet and resolve any such issue in good faith to the satisfaction of
Borrower, Agent, Lender, and any governmental regulatory agency, and (y) upon
request of Lender or Agent, Borrower will cooperate and assist with any
assignment of the financing agreements between Hercules Technology III, L.P. and
Hercules Technology Growth Capital, Inc.
LSA-26

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EXHIBIT A
ADVANCE REQUEST
To: Agent: Date: [●], 2016
Hercules Technology Growth Capital, Inc. (the "Agent")
400 Hamilton Avenue, Suite 310
Palo Alto, CA 94301
email: legal@herculestech.com
Attn:
[Advance request to be provided to each Lender]
CytRx Corporation ("Borrower") hereby requests from [Hercules Technology Growth
Capital, Inc.]/[Hercules Technology III, L.P.] ("Lender") an Advance in the
amount of _____________________ Dollars ($________________) on [___], 201[6]
(the "Advance Date") pursuant to the Loan and Security Agreement among Borrower,
Agent and Lender (the "Agreement"). Capitalized words and other terms used but
not otherwise defined herein are used with the same meanings as defined in the
Agreement.
Please:
(a)            Issue a check payable to
Borrower                                                                                                  ________
or
(b)            Wire Funds to Borrower's
account                                                                                                  ________

Bank: _____________________________

Address: _____________________________

_____________________________

ABA Number: _____________________________

Account Number: ____________________________

Account Name: _____________________________

Contact Person: _____________________________

Phone Number _____________________________

To Verify Wire Info: _____________________________

Email address: ____________________________

Borrower represents that the conditions precedent to the Advance set forth in
the Agreement are satisfied and shall be satisfied upon the making of such
Advance, including but not limited to:  (i) that no event that has had or could
reasonably be expected to have a Material Adverse Effect has occurred and is
continuing; (ii) that the representations and warranties set forth in the
Agreement and in the Warrants are and shall be true and correct in all material
respects on and as of the Advance Date with the same effect as though made on
and as of such date, except to the extent such representations and warranties
expressly relate to an earlier date; (iii) that Borrower is in compliance with
all the terms and provisions set forth in each Loan Document on its part to be
observed or performed; and (iv) that as of the Advance Date, no fact or
condition exists that would (or would, with the passage of time, the giving of
notice, or both) constitute an Event of Default under the Loan Documents. 
Borrower understands and acknowledges that Agent has the right to review the
financial information supporting this representation and, based upon such review
in its sole discretion, Lender may decline to fund the requested Advance.
Borrower hereby represents that Borrower's corporate status and locations have
not changed since the date of the Agreement or, if the Attachment to this
Advance Request is completed, are as set forth in the Attachment to this Advance
Request.
Borrower agrees to notify Agent promptly before the funding of the Loan if any
of the matters which  have been represented above shall not be true and correct
on the Borrowing Date and if Agent has received no such notice before the
Advance Date then the statements set forth above shall be deemed to have been
made and shall be deemed to be true and correct as of the Advance Date.
Executed as of [●], 2016.
BORROWER: CYTRX CORPORATION
SIGNATURE:________________________
TITLE:_____________________________
PRINT NAME:______________________

LSA-27

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ATTACHMENT TO ADVANCE REQUEST
Dated: _______________________
Borrower hereby represents and warrants to Agent that Borrower's current name
and organizational status is as follows:
Name:                                                                      CytRx
Corporation
Type of organization:          Corporation
State of organization:                   Delaware
Organization file number:    2055980
Borrower hereby represents and warrants to Agent that the street address, city ,
state and postal code of its current location are as follows: 11726 San Vicente
Blvd., Suite 650, Los Angeles, CA 90049
LSA-28

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EXHIBIT B
SECURED TERM PROMISSORY NOTE
$[●],000,000 Advanced Date:  [●], 20[●]
Maturity Date:  [●], 20[●]
FOR VALUE RECEIVED, CYTRX CORPORATION, a Delaware corporation, for itself and
each of its Qualified Subsidiaries ("Borrower") hereby promises to pay to the
order of [Hercules Technology Growth Capital, Inc., a Maryland
corporation]/[Hercules Technology III, L.P., a Delaware limited partnership] or
the holder of this Note (the "Lender") at 400 Hamilton Avenue, Suite 310, Palo
Alto, CA 94301 or such other place of payment as the holder of this Secured Term
Promissory Note (this "Promissory Note") may specify from time to time in
writing, in lawful money of the United States of America, the principal amount
of [  ] Million Dollars ($[●],000,000) or such other principal amount as Lender
has advanced to Borrower, together with interest at a rate as set forth in
Section 2.1(c) of the Loan Agreement based upon a year consisting of 360 days,
with interest computed daily based on the actual number of days in each month.
This Promissory Note is the Note referred to in, and is executed and delivered
in connection with, that certain Loan and Security Agreement dated [●], 2016, by
and among Borrower, Hercules Technology Growth Capital, Inc., a Maryland
corporation (the "Agent") and the several banks and other financial institutions
or entities from time to time party thereto as lender (as the same may from time
to time be amended, modified or supplemented in accordance with its terms, the
"Loan Agreement"), and is entitled to the benefit and security of the Loan
Agreement and the other Loan Documents (as defined in the Loan Agreement), to
which reference is made for a statement of all of the terms and conditions
thereof.  All payments shall be made in accordance with the Loan Agreement. All
payments shall be made in accordance with the Loan Agreement. All terms defined
in the Loan Agreement shall have the same definitions when used herein, unless
otherwise defined herein. An Event of Default under the Loan Agreement shall
constitute a default under this Promissory Note.
Borrower waives presentment and demand for payment, notice of dishonor, protest
and notice of protest under the UCC or any applicable law.  Borrower agrees to
make all payments under this Promissory Note without setoff, recoupment or
deduction and regardless of any counterclaim or defense. This Promissory Note
has been negotiated and delivered to Lender and is payable in the State of
California. This Promissory Note shall be governed by and construed and enforced
in accordance with, the laws of the State of California, excluding any conflicts
of law rules or principles that would cause the application of the laws of any
other jurisdiction.
BORROWER FOR ITSELF AND
ON BEHALF OF ITS QUALIFIED
SUBSIDIARIES:                                                                                                                                                            CYTRX
CORPORATION
By:
Title:

LSA-29

--------------------------------------------------------------------------------

EXHIBIT C
NAME, LOCATIONS, AND OTHER INFORMATION FOR BORROWER
8.
Borrower represents and warrants to Agent that Borrower's current name and
organizational status as of the Closing Date is as follows:

Name:                                                                CytRx
Corporation
Type of organization: Corporation
State of
organization:                                                                Delaware
Organization file number: 2055980
9.
Borrower represents and warrants to Agent that for five (5) years prior to the
Closing Date, Borrower did not do business under any other name or organization
or form except the following:

Name:
Used during dates of:
Type of Organization:
State of organization:
Organization file Number:
Borrower's fiscal year ends on December 31
Borrower's federal employer tax identification number is: 58-1642740
10.
Borrower represents and warrants to Agent that its chief executive office is
located at 11726 San Vicente Blvd., Suite 650, Los Angeles, CA 90049.

LSA-30

--------------------------------------------------------------------------------

EXHIBIT D
BORROWER'S PATENTS, TRADEMARKS, COPYRIGHTS AND LICENSES
Patents

ALDOXORUBICIN

Method For Producing An Injectable Medicament Preparation

COUNTRY NAME
PATENT APPLICATION NUMBER
FILING DATE
PATENT NUMBER
USA
09/980,266
30-Nov-01
7,387,771
USA
12/604,093
22-Oct-09
8,153,581
USA
13/414,316
7-Mar-12
8,846,602
USA
14/469,232
26-Aug-14
 
Albania
06012171.2
7-Jun-00
1704864
Austria
00945721.9
7-Jun-00
1183050
Austria
06012171.2
7-Jun-00
1704864
Australia
59709/00
7-Jun-00
779697
Belgium
00945721.9
7-Jun-00
1183050
Belgium
06012171.2
7-Jun-00
1704864
Canada
2,374,964
7-Jun-00
2,374,964
Switzerland
00945721.9
7-Jun-00
1183050
Switzerland
06012171.2
7-Jun-00
1704864
Cyprus
00945721.9
7-Jun-00
1183050
Cyprus
06012171.2
7-Jun-00
1704864
Germany
DE19926154.7
9-Jun-99
 
Germany
00945721.9
7-Jun-00
500113468.5
Germany
06012171.2
7-Jun-00
50016230.1
Denmark
00945721.9
7-Jun-00
1183050
Denmark
06012171.2
7-Jun-00
1704864
EPO
00945721.9
7-Jun-00
1183050
EPO
06012171.2
7-Jun-00
1704864
EPO
10183870.4
7-Jun-00
 
Spain
00945721.9
7-Jun-00
1183050
Spain
06012171.2
7-Jun-00
1704864
Finland
06012171.2
7-Jun-00
1704864
Finland
00945721.9
7-Jun-00
1183050
France
00945721.9
7-Jun-00
1183050
France
06012171.2
7-Jun-00
1704864
United Kingdom
00945721.9
7-Jun-00
1183050
United Kingdom
06012171.2
7-Jun-00
1704864
Greece
00945721.9
7-Jun-00
1183050
Greece
06012171.2
7-Jun-00
1704864
Hong Kong
12100746.3
7-Jun-00
 
Ireland
00945721.9
7-Jun-00
1183050
Ireland
06012171.2
7-Jun-00
1704864
Italy
00945721.9
7-Jun-00
1183050
Italy
06012171.2
7-Jun-00
1704864
Japan
2001-502882
7-Jun-00
5517384
Japan
2011-102053
7-Jun-00
 
Japan
2013-268998
7-Jun-00
 
Lithuania
06012171.2
7-Jun-00
1704864
Luxembourg
00945721.9
7-Jun-00
1183050
Luxembourg
06012171.2
7-Jun-00
1704864
Latvia
06012171.2
7-Jun-00
1704864
Monaco
00945721.9
7-Jun-00
1183050
Monaco
06012171.2
7-Jun-00
1704864
Frmr. Yug. Rep. of Macedonia
06012171.2
7-Jun-00
904232
Netherlands
00945721.9
7-Jun-00
1183050
Netherlands
06012171.2
7-Jun-00
1704864
Portugal
00945721.9
7-Jun-00
1183050
Portugal
06012171.2
7-Jun-00
1704864
Romania
06012171.2
7-Jun-00
1704864
Sweden
00945721.9
7-Jun-00
1183050
Sweden
06012171.2
7-Jun-00
1704864
Slovenia
06012171.2
7-Jun-00
1704864

Therapeutic And Diagnostic Ligand Systems Comprising Transport Molecule Binding
Properties And Medicaments Containing The Same

COUNTRY NAME
PATENT APPLICATION NUMBER
FILING DATE
PATENT NUMBER
USA
10/221,544
20-Feb-03
7,902,144
Austria
01933693.2
13-Mar-01
1272223
Belgium
019336932
13-Mar-01
1272223
Switzerland
019336932
13-Mar-01
1272223
Germany
019336932
13-Mar-01
50109960.3
EPO
01933693.2
13-Mar-01
1272223
Spain
019336932
13-Mar-01
1272223
France
019336932
13-Mar-01
1272223
United Kingdom
019336932
13-Mar-01
1272223
Ireland
019336932
13-Mar-01
1272223
Italy
019336932
13-Mar-01
1272223

Anthracycline Formulations

COUNTRY NAME
PATENT APPLICATION NUMBER
FILING DATE
PATENT NUMBER
USA
14/651,898
12-Jun-15
 
Australia
2013359048
13-Dec-13
 
Canada
2,894,548
13-Dec-13
 
EPO
13863251.8
13-Dec-13
 
Hong Kong
15111069.6
13-Dec-13
 
Japan
2015-547985
13-Dec-13
 
New Zealand
630070
13-Dec-13
 

Cytotoxic Agents For The Treatment Of Cancer

COUNTRY NAME
PATENT APPLICATION NUMBER
FILING DATE
PATENT NUMBER
USA
14/893,821
24-Nov-15
 
Argentina
P20140102188
5-Jun-14
 
Australia
2014274940
4-Jun-14
 
Brazil
BR1120150306233
4-Jun-14
 
Canada
Not Yet Assigned
4-Jun-14
 
China
Not Yet Assigned
4-Jun-14
 
EPO
14807006.3
4-Jun-14
 
India
Not Yet Assigned
4-Jun-14
 
Japan
Not Yet Assigned
4-Jun-14
 
Republic of Korea
Not Yet Assigned
4-Jun-14
 
New Zealand
631022
4-Jun-14
 
Russian Federation
Not Yet Assigned
4-Jun-14
 
Taiwan R.O.C.
103119626
5-Jun-14
 

Delivery Systems For Controlled Drug Release

COUNTRY NAME
PATENT APPLICATION NUMBER
FILING DATE
PATENT NUMBER
USA
62/182,219
19-Jun-15
 
USA
62/261,213
30-Nov-15
 
USA
62/261,563
1-Dec-15
 

Trademarks
Trademark:  CYTRX
U.S. Serial No.:  85/567,155
Goods:  Pharmaceutical preparations for the treatment of cancer in Class 05
Applicant:  CytRx Corporation
Status:  Allowed/Live

Trademarks:

[image00003.jpg]

Licenses

Agreement
Date
Related Intellectual Property
     
1/ KTB Tumorforschungs GmbH License Agreement
 
2/ KTB Tumorgesellschaft        GmbHv(Amendment 2014)
August 17, 2006
 
 
March 14, 2014
       
3/ Agreement and Plan of Merger between Innovive Pharmaceuticals and CytRx
June 6, 2008
             

Government Licenses

FDA AND RELATED REGULATORY MATTERS
a.
The following is a list of all products designed, manufactured, distributed and
or sold by or for the Company or any of its subsidiaries that are subject to
regulatory review and approval by the Food and Drug Administration of the United
States ("FDA"): Aldoxorubicin

b.
The following is a complete description of any FDA protocols applicable to
products designed, produced, sold or distributed by the Company or its
Subsidiaries:

1.)
An Open-Label Phase 1 / 2 Study to Investigate the Preliminary Safety and
Activity of Aldox plus Ifosfamide in Subjects with Metastatic, Locally Advanced,
or Unresectable STS

2.)
An Open-Label Phase 1b Study to Investigate the Preliminary Safety and Activity
of Aldox plus Gemcidabine in Subjects with Metastatic Solid Tumors.

3.)
An Open – Label Pilot Phase 2 Study to Investigate the Preliminary Efficacy and
Safety of Aldox in Subjects with Unresectable Glioblastoma Whose Tumors Have
Progressed Following Prior Treatment with Surgery, Radiation and Temozolomide

4.)
An Open-Label Pilot Phase 2 Study to Investigate Efficacy, Safety and
Intratumoral Kinetics of Aldox in HIV-Infected Patients with Kaposi's Sarcoma

5.)
A Multicenter, Randomized, Open-Label Phase 2b Study to Investigate the Efficacy
and Safety of Aldox Compared to Topotecan in Subjects with Metastatic Small Cell
Lung Cancer Who Either Relapsed or Were Refractory to Prior Chemotherapy

6.)
A Multicenter, Randomized, Open-Label Phase 3 Study to Investigate the Efficacy
and Safety of Aldox Compared to Investigator's Choice in Subjects with
Metastatic, Locally Advanced, or Unresectable Soft Tissue Sarcomas Who Either
Relapsed or Were Refractory to Prior Non-Adjuvant Chemotherapy

7.)
Compassionate Use of Aldox in Sarcoma Patients Who Have Failed Prior
Chemotherapy

LSA-31

--------------------------------------------------------------------------------

 
EXHIBIT F
COMPLIANCE CERTIFICATE
Hercules Technology Growth Capital, Inc. (as "Agent")
400 Hamilton Avenue, Suite 310
Palo Alto, CA 94301
Reference is made to that certain Loan and Security Agreement dated [●], 2016
and the Loan Documents (as defined therein) entered into in connection with such
Loan and Security Agreement all as may be amended from time to time (hereinafter
referred to collectively as the "Loan Agreement") by and among Hercules
Technology Growth Capital, Inc. (the "Agent"), the several banks and other
financial institutions or entities from time to time party thereto
(collectively, the "Lender") and Hercules Technology Growth Capital, Inc., as
Agent for the Lender (the "Agent") and CytRx Corporation (the "Company") as
Borrower. All capitalized terms not defined herein shall have the same meaning
as defined in the Loan Agreement.
The undersigned is an Officer of the Company, knowledgeable of all Company
financial matters, and is authorized to provide certification of information
regarding the Company; hereby certifies, in such capacity, that in accordance
with the terms and conditions of the Loan Agreement, the Company is in
compliance for the period ending [●] of all covenants, conditions and terms and
hereby reaffirms that all representations and warranties contained therein are
true and correct on and as of the date of this Compliance Certificate with the
same effect as though made on and as of such date, except to the extent such
representations and warranties expressly relate to an earlier date, after giving
effect in all cases to any standard(s) of materiality contained in the Loan
Agreement as to such representations and warranties.  Attached are the required
documents supporting the above certification. The undersigned further certifies
that the attached Interim Financial Statements and the Audited Financial
Statements were prepared in accordance with GAAP (except for the absence of
footnotes with respect to unaudited financial statement and subject to normal
year-end adjustments) and are consistent from one period to the next except as
explained below.
REPORTING REQUIREMENT
REQUIRED
CHECK IF ATTACHED
Interim Financial Statements
Monthly within 30 days
 
Audited Financial Statements
Quarterly within 40 days
   
FYE within 90 days
 

Very Truly Yours,

                                                                      CytRx
Corporation

                                                                      By: 
_________________________
                                                                      Name: 
______________________
                                                                      Its: 
_________________________

LSA-32

--------------------------------------------------------------------------------

EXHIBIT G
FORM OF JOINDER AGREEMENT
This Joinder Agreement (the "Joinder Agreement") is made and dated as of [●],
2016, and is entered into by and between [●], a [●] corporation ("Subsidiary"),
and HERCULES TECHNOLOGY GROWTH CAPITAL, INC., a Maryland corporation (as
"Agent").
RECITALS
C.            Subsidiary's Affiliate, CytRx Corporation ("Company") has entered
into that certain Loan and Security Agreement dated [●], 2016, with the several
banks and other financial institutions or entities from time to time party
thereto as lender (collectively, the "Lender") and Agent, as such agreement may
be amended (the "Loan Agreement"), together with the other agreements executed
and delivered in connection therewith;
D.            Subsidiary acknowledges and agrees that it will benefit both
directly and indirectly from Company's execution of the Loan Agreement and the
other agreements executed and delivered in connection therewith;
AGREEMENT
NOW THEREFORE, Subsidiary and Agent agree as follows:
11.
The recitals set forth above are incorporated into and made part of this Joinder
Agreement. Capitalized terms not defined herein shall have the meaning provided
in the Loan Agreement.

12.
By signing this Joinder Agreement, Subsidiary shall be bound by the terms and
conditions of the Loan Agreement the same as if it were Borrower (as defined in
the Loan Agreement) under the Loan Agreement, mutatis mutandis,
provided however, that (a) with respect to (i) Section 5.1 of the Loan
Agreement, Subsidiary represents that it is an entity duly organized, legally
existing and in good standing under the laws of [●], (b) neither Agent nor
Lender shall have any duties, responsibilities or obligations to Subsidiary
arising under or related to the Loan Agreement or the other agreements executed
and delivered in connection therewith, (c) that if Subsidiary is covered by
Company's insurance, Subsidiary shall not be required to maintain separate
insurance or comply with the provisions of Sections 6.1 and 6.2 of the Loan
Agreement, and (d) that as long as Company satisfies the requirements of
Section 7.1 of the Loan Agreement, Subsidiary shall not have to provide Agent
separate Financial Statements.  To the extent that Agent or Lender has any
duties, responsibilities or obligations arising under or related to the Loan
Agreement or the other agreements executed and delivered in connection
therewith, those duties, responsibilities or obligations shall flow only to
Company and not to Subsidiary or any other Person or entity.  By way of example
(and not an exclusive list): (i) Agent's providing notice to Company in
accordance with the Loan Agreement or as otherwise agreed among Company, Agent
and Lender shall be deemed provided to Subsidiary; (ii) a Lender's providing an
Advance to Company shall be deemed an Advance to Subsidiary; and
(iii) Subsidiary shall have no right to request an Advance or make any other
demand on Lender.

13.
Subsidiary agrees not to certificate its equity securities without Agent's prior
written consent, which consent may be conditioned on the delivery of such equity
securities to Agent in order to perfect Agent's security interest in such equity
securities.

14.
Subsidiary acknowledges that it benefits, both directly and indirectly, from the
Loan Agreement, and hereby waives, for itself and on behalf on any and all
successors in interest (including without limitation any assignee for the
benefit of creditors, receiver, bankruptcy trustee or itself as
debtor-in-possession under any bankruptcy proceeding) to the fullest extent
provided by law, any and all claims, rights or defenses to the enforcement of
this Joinder Agreement on the basis that (a) it failed to receive adequate
consideration for the execution and delivery of this Joinder Agreement or
(b) its obligations under this Joinder Agreement are avoidable as a fraudulent
conveyance.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

LSA-33

--------------------------------------------------------------------------------

[SIGNATURE PAGE TO JOINDER AGREEMENT]
SUBSIDIARY:
_________________________________.

By:
Name:
Title:
Address:
Telephone: ___________
email: ____________
AGENT:

HERCULES TECHNOLOGY GROWTH CAPITAL, INC.

By:____________________________________
Name:__________________________________
Title: ___________________________________

Address:
400 Hamilton Ave., Suite 310
Palo Alto, CA 94301
email: legal@herculestech.com
Telephone:  650-289-3060
LSA-34

--------------------------------------------------------------------------------

EXHIBIT H
ACH DEBIT AUTHORIZATION AGREEMENT
Hercules Technology Growth Capital, Inc., as Agent
400 Hamilton Avenue, Suite 310
Palo Alto, CA  94301

Re:  Loan and Security Agreement dated [●], 2016 (the "Agreement") by and among
CytRx Corporation ("Borrower") and Hercules Technology Growth Capital, Inc., as
Agent (the "Company") and the lenders party thereto (collectively, the "Lender")
In connection with the above referenced Agreement, Borrower hereby authorizes
the Company to initiate debit entries for (i) the periodic payments due under
the Agreement and (ii) out-of-pocket legal fees and costs payable to Agent or
Lender pursuant to Section 11.11 of the Agreement to Borrower's account
indicated below.  The Borrower authorizes the depository institution named below
to debit to such account.

[IF FILED PUBLICLY, ACCOUNT INFO REDACTED FOR SECURITY PURPOSES]
DEPOSITORY NAME
BRANCH
CITY
STATE AND ZIP CODE
TRANSIT/ABA NUMBER
ACCOUNT NUMBER

This authority will remain in full force and effect so long as any amounts are
due under the Agreement.
____________________________________________
(Borrower)(Please Print)
By: _________________________________________
Date: ________________________________________

LSA-35

--------------------------------------------------------------------------------

SCHEDULE 1.1
COMMITMENTS
LENDER
CLOSING DATE TERM LOAN ADVANCE
ADDITIONAL ADVANCE
Hercules Technology Growth Capital, Inc.
$12,500,000
$15,000,000
Hercules Technology III, L.P.
$12,500,000
--
TOTAL COMMITMENTS
$25,000,000
$15,000,000

 
 
LSA-36

--------------------------------------------------------------------------------

SCHEDULE 1A
EXISTING PERMITTED INDEBTEDNESS

None.

LSA-37

--------------------------------------------------------------------------------

 

SCHEDULE 1C
EXISTING PERMITTED LIENS

None.
LSA-38

--------------------------------------------------------------------------------

SCHEDULE 5.3
CONSENTS, ETC.
None.

LSA-39

--------------------------------------------------------------------------------

SCHEDULE 5.8
TAX MATTERS
None.

LSA-40

--------------------------------------------------------------------------------

SCHEDULE 5.9
INTELLECTUAL PROPERTY CLAIMS
None.
LSA-41

--------------------------------------------------------------------------------

SCHEDULE 5.10
INTELLECTUAL PROPERTY RIGHTS
None.
LSA-42

--------------------------------------------------------------------------------

SCHEDULE 5.11
BORROWER PRODUCTS
None.
LSA-43

--------------------------------------------------------------------------------

SCHEDULE 5.14
CAPITALIZATION AND SUBSIDIARIES
Borrower does not have any Subsidiaries.
Borrower's capitalization is set forth in the attachment to this Schedule 5.14.
LSA-44