exhibit10-1.htm


     

    EXHIBIT
10.1

    


      EMPLOYMENT
AGREEMENT

       

      This
Employment Agreement (this “Agreement”) is made
and entered into as of October 12, 2009 (the “Effective Date”) by
and between CytRx Corporation, a Delaware corporation (“Employer”), and
Daniel Levitt, M.D., Ph.D., an individual and resident of the State of
California (“Employee”).

       

      WHEREAS,
Employer desires to employ Employee, and Employee is willing to be employed by
Employer, on the terms set forth in this Agreement.

       

      NOW,
THEREFORE, upon the above premises, and in consideration of the mutual covenants
and agreements hereinafter contained, the parties hereto agree as
follows.

       

      1.           Employment.  Effective
as of the Effective Date, Employer shall employ Employee, and Employee shall
serve, as Employer’s Chief Medical Officer on the terms set forth
herein.

       

      2.           Duties; Places of
Employment.  Employee shall perform in a professional and
business-like manner, and to the best of his ability, the duties described on
Schedule 1
to this Agreement and such other duties as are assigned to him from time to time
by Employer’s President and Chief Executive Officer.  Employee
understands and agrees that his duties, title and authority may be changed from
time to time in the discretion of Employer’s President and Chief Executive
Officer.  Subject to the succeeding sentences, Employee’s services
hereunder shall be rendered at Employer’s San Francisco office and its corporate
offices in Los Angeles, California, except for travel when and as required in
the performance of Employee’s duties hereunder.  Employee generally
shall be required to be physically present, and to perform his services
hereunder, at Employee’s corporate headquarters not less than three consecutive
business days per week for not more than 46 weeks per year, reduced by each week
when traveling for the Employer’s business.  Employee and Employer
shall consult with each other from time to time regarding the optimal scheduling
of Employee’s time at Employer’s San Francisco and corporate
offices.  Employee may work remotely from the San Francisco office and
during such time, Employee shall make himself readily accessible to Employer by
telephone, via the Internet or other remote access, as Employer deems reasonably
necessary for the performance of Employee’s services
hereunder.  Employer shall make available to Employee remote computer
access in Employer’s San Francisco office to Employer’s computerized systems and
shall provide technical and hardware support.

       

      3.           Time and
Efforts.  Subject to this Section 3, Employee shall devote all
of his business time, efforts, attention and energies to Employer’s business and
to discharge his duties hereunder.  Employer agrees that Employee may
continue to serve as a director on the board of directors of Aquinox Corp. and
as a director and treasurer of the board of the San Francisco
SPCA.  In addition, Employee may serve on the board or advisory
committee of one other company or organization from time to time, provided that
such company
or organization is not directly competitive with Employer and provided that
Employer has consented to such role by Employee, which consent shall not be
unreasonably withheld.

         

      

       


      
        
           


        

        
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      4.           Term.  The
term (the “Term”) of Employee’s
employment hereunder shall commence on the Effective Date and shall expire on
December 31, 2010, unless sooner terminated in accordance with Section
6.  Neither Employer nor Employee shall have any obligation to extend
or renew this Agreement.  In the event that Employer does not offer to
extend or renew the Agreement, Employer shall continue to pay Employee his
salary as provided for in Section 5.1 during the period commencing on the
final date of the Term and ending on (a) June 30, 2011 or (b) the
date of Employee’s re-employment with another employer, whichever is earlier;
provided that, as a condition to Employer’s obligations under this sentence,
Employee shall have executed and delivered to Employer a Separation Agreement
and General Release in the form attached
hereto as Exhibit A.  Employee
shall notify Employer immediately in the event Employee accepts such employment
with another employer.

       

      5.           Compensation.  As
the total consideration for Employee’s services rendered hereunder, Employer
shall pay or provide Employee the following compensation and
benefits:

       

      5.1.           Salary.  Employee
shall be entitled to receive an annual salary of Three Hundred Seventy Five
Thousand Dollars ($375,000), payable in accordance with Employer’s normal
payroll policies and procedures.

       

      5.2.           Discretionary
Bonus.  Employee also may be eligible for a bonus from time to
time for his services during the Term.  Employee’s eligibility to
receive a bonus, any determination to award Employee such a bonus and, if
awarded, the amount thereof, shall be in Employer’s sole discretion; provided
that the bonus payable with respect to calendar year 2010 shall not be less than
25% of Employee’s base salary at the time that bonus is paid.

       

      5.3.           Stock
Options.  Employer shall grant Employee as of the Effective
Date a nonqualified stock option under Employer’s 2000 Long-Term Incentive Plan
(the “Plan”) to
purchase 500,000 shares of Employer’s common stock (the “Option”).  The
Option shall vest and become exercisable in 36 equal monthly installments
beginning on the one-month anniversary of the Effective Date and continuing on
each succeeding monthly anniversary of the Effective Date until the Option shall
have become fully vested, provided, in each case, that Employee remains in the
continuous employ of Employer through such anniversary dates.  The
Option shall (a) be exercisable at an exercise price equal to $1.06 per share,
(b) have a term of ten years, and (c) be on such other terms as shall be
determined by Employer’s Board of Directors (or the Compensation Committee of
the Board) and set forth in a customary form of stock option agreement under the
Plan evidencing the Option.  Notwithstanding anything to the contrary
in Section 6.2 or other provision of this Agreement or of the stock option
agreement evidencing the Option, upon the occurrence of a “Change in Control”
(as defined in the Plan), the entire (100%) Option shall thereupon vest and
become exercisable
as to all of the shares covered thereby in accordance with the terms of the
Plan.

       


      
        
           


        

        
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      5.4.           Expense
Reimbursement.  (a) Employer shall reimburse Employee for
reasonable and necessary business expenses incurred by Employee in connection
with the performance of Employee’s duties in accordance with Employer’s usual
practices and policies in effect from time to time.  (b) When Employee
travels to Employer’s corporate offices, Employer shall pay for round-trip
airfare and airport parking, but shall not pay for food or other incidentals
except as specifically set forth herein.  During the Term, Employer
shall provide Employee with (i) access to a furnished apartment leased by
Employer in reasonable proximity to Employer’s corporate offices, inclusive of
parking, utilities, cable and Internet access, weekly cleaning and laundry
service, (ii) Employer-paid memberships to (x) a health club reasonably near
Employer’s corporate offices and (y) one airline club, and (iii) the use of a
rental car leased by Employer with Employer-paid insurance for use while in Los
Angeles, California.

       

      5.5.           Tax
Gross-Ups.

       

      (a)           Travel and Housing
Payments.  In the event it shall be determined that any payment
by the Employer to or for the benefit of Employee under Section 5.4(b) above
(whether paid or payable pursuant to the terms of this Agreement or otherwise,
but determined without regard to any additional payments required under this
Section 5.5) (a “Travel and Housing Payment”) would be subject to federal or
state income or payroll tax (such income and payroll tax, together with any such
interest and penalties, are hereinafter collectively referred to as the
“Additional Section 5.4(b) Income Tax”), then Employee shall be entitled to
receive an additional payment (a “Gross-Up Payment”) in an amount such that
after payment by Employee of all taxes (including any interest or penalties
imposed with respect to such taxes), including, without limitation, any income
taxes (and any interest and penalties imposed with respect thereto) imposed upon
the Gross-Up Payment, Employee retains an amount of the Gross-Up Payment equal
to the Additional Section 5.4(b) Income Tax imposed upon the Travel and Housing
Payments.

       

      (b)           Change in Control
Payments.  In the event it shall be determined that any payment
or distribution by the Employer to or for the benefit of Employee (whether paid
or payable or distributed or distributable pursuant to the terms of this
Agreement, including Section 5.3 above, or otherwise, but determined without
regard to any additional payments required under this Section 5.5) (a “Change in
Control Payment”) would be subject to the excise tax imposed by Section 4999 of
the Internal Revenue Code of 1986, as amended (the “Code”) or any interest or
penalties are incurred by Employee with respect to such excise tax (such excise
tax, together with any such interest and penalties, are hereinafter collectively
referred to as the “Excise Tax”), then Employee shall be entitled to receive an
additional payment (a “Parachute Gross-Up Payment”) in an amount such that after
payment by Employee of all taxes (including any interest or penalties imposed
with respect to such taxes), including, without limitation, any income taxes
(and any interest and penalties imposed with respect thereto) and Excise Tax
imposed upon the Parachute Gross-Up Payment, Employee retains an amount of the
Parachute Gross-Up Payment equal to the Excise Tax imposed upon the Change in
Control Payments.

       


      
        
           


        

        
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      (c)           Subject
to the provisions of Section 5.5(d) hereof, all determinations required to be
made under this Section 5.5, including whether and when a Gross-Up Payment or a
Parachute Gross-Up Payment is required and the amount of such Gross-Up Payment
or Parachute Gross-Up Payment, whichever shall apply, and the assumptions to be
used in arriving at such determination, shall be made by the certified public
accounting firm designated by the Employer (the “Accounting Firm”) which shall
provide detailed supporting calculations both to the Employer and Employee
within 15 business days of the receipt of notice from Employee that there has
been a Change in Control Payment or the Travel and Housing Payment is being
treated as taxable income to Employee.  All fees and expenses of the
Accounting Firm shall be borne solely by the Employer.  Any Gross-Up
Payment or Parachute Gross-Up Payment, as determined pursuant to this Section
5.5, shall be paid by the Employer to Employee within five days of the receipt
of the Accounting Firm’s determination.  Any determination by the
Accounting Firm shall be binding upon the Employer and Employee.  As a
result of the uncertainty in the application of Sections 61 or 4999 of the
Code at the time of the initial determination by the Accounting Firm hereunder,
it is possible that Gross-Up Payments or Parachute Gross-Up Payments which will
not have been made by the Employer should have been made (“Underpayment”),
consistent with the calculations required to be made hereunder.  In
the event that the Employer exhausts its remedies pursuant to Section 5.5(d) and
Employee thereafter is required to make a payment of any Additional Section
5.4(b) Income Tax or any Excise Tax, the Accounting Firm shall determine the
amount of the Underpayment that has occurred and any such Underpayment shall be
promptly paid by the Employer to or for the benefit of Employee.

       

      (d)           Employee
shall notify the Employer in writing of any claim by the Internal Revenue
Service that, if successful, would require the payment by the Employer of the
Gross-Up Payment or the Parachute Gross-Up Payment.  Such notification
shall be given as soon as practicable but no later than thirty days after
Employee is informed in writing of such claim and shall apprise the Employer of
the nature of such claim and the date on which such claim is requested to be
paid.  Employee shall not pay such claim prior to the expiration of
the 30-day period following the date on which it gives such notice to the
Employer (or such shorter period ending on the date that any payment of taxes
with respect to such claim is due).  If the Employer notifies Employee
in writing prior to the expiration of such period that it desires to contest
such claim, Employee shall:  give the Employer any information
reasonably requested by the Employer relating to such claim,

       

      (i)           take
such action in connection with contesting such claim as the Employer shall
reasonably request in writing from time to time, including, without limitation,
accepting legal representation with respect to such claim by an attorney
reasonably selected by the Employer,

       

      (ii)           cooperate
with the Employer in good faith in order effectively to contest such claim,
and

       


      
        
           


        

        
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      (iii)           permit
the Employer to participate in any proceedings relating to such
claim;

       

      provided,
however, that the Employer shall bear and pay directly all costs and expenses
(including additional interest and penalties) incurred in connection with such
contest and shall indemnify and hold Employee harmless, on an after-tax basis,
for any Excise Tax or income tax (including interest and penalties with respect
thereto) imposed as a result of such representation and payment of costs and
expenses.  Without limitation of the foregoing provisions to this
Section 5.5(d), the Employer shall control all proceedings taken in connection
with such contest and, at its sole option, may pursue or forgo any and all
administrative appeals, proceedings, hearings and conferences with the taxing
authority in respect of such claim.

       

      5.6.           Vacation.  Employee
shall be entitled to twenty business days of
vacation each year during the Term in accordance with Employer’s vacation policy
in effect from time to time.

       

      5.7.           Employee
Benefits.  Employee shall be eligible to participate in any
medical insurance and other employee benefits made available generally by
Employer to all of its employees under its group plans and employment policies
in effect during the Term.  Schedule 2
hereto sets forth a summary of such plans and policies as currently in
effect.  Employee acknowledges and agrees that, any such plans or
policies now or hereafter in effect may be modified or terminated by Employer at
any time in its discretion.

       

      5.8.           Payroll
Taxes.  Employer shall have the right to deduct from the
compensation and benefits due to Employee hereunder any and all sums required
for social security and withholding taxes and for any other federal, state, or
local tax or charge which may be in effect or hereafter enacted or required as a
charge on the compensation or benefits of Employee.

       

      6.           Termination.  This
Agreement may be terminated as set forth in this Section 6.

       

      6.1.           Termination by Employer for
Cause.  Employer may terminate Employee’s employment hereunder
for “Cause” upon notice to Employee.  “Cause” for this
purpose shall mean any of the following:

       

      (a)           Employee’s
breach of any material term of this Agreement; provided that the first occasion
of any particular breach shall not constitute such Cause unless Employee shall
have previously received written notice from Employer stating the nature of such
breach and affording Employee at least ten business days to correct such
breach;

       

      (b)           Employee’s
conviction of, or plea of guilty or nolo contendere to, any misdemeanor, felony
or other crime of moral turpitude;

       


      
        
           


        

        
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      (c)           Employee’s
act of fraud or dishonesty injurious to Employer or its reputation;

       

      (d)           Employee’s
continual failure or refusal to perform his material duties as required under
this Agreement after written notice from Employer stating the nature of such
failure or refusal and affording Employee at least ten business days to correct
the same;

       

      (e)           Employee’s
act or omission that, in the reasonable determination of Employer’s Board of
Directors (or a Committee of the Board), indicates alcohol or drug abuse by
Employee; or

       

      (f)           Employee’s
act or personal conduct that, in the judgment of Employer’s Board of Directors
(or a Committee of the Board), gives rise to a material risk of liability of
Employee or Employer under federal or applicable state law for discrimination,
or sexual or other forms of harassment, or other similar liabilities to
subordinate employees.

       

      Upon
termination of Employee’s employment by Employer for Cause, all compensation and
benefits to Employee hereunder shall cease and Employee shall be entitled only
to payment, not later than three days after the date of termination, of any
accrued but unpaid salary and unused vacation as provided in Sections 5.1 and
5.5 as of the date of such termination and any unpaid bonus that may have been
earned or awarded Employee as provided in Section 5.2 prior to such
date.

       

      6.2.           Termination by Employer
without Cause.  Employer may also terminate Employee’s
employment without Cause upon ten days notice to Employee.  Upon
termination of Employee’s employment by Employer without Cause, all compensation
and benefits to Employee hereunder shall cease and Employee shall be entitled to
(a) payment of (1) any accrued but unpaid salary, the minimum bonus described in
Section 5.2 applied to the base salary paid through the date of termination, any
Tax Gross-Up or Parachute Tax Gross-Up payment as described in Section 5.5 and
unused vacation as of the date of such termination as required by California
law, which shall be due and payable upon the effective date of such termination,
and (2) an amount, which shall be due and payable within ten days following the
effective date of such termination, equal to six months’ salary as provided in
Section 5.1, and (b) continued participation, at Employer’s cost and
expense, for a period of six months following such termination, in any
Employer-sponsored group benefit plans in which Employee was participating as of
the date of termination, provided that, as a condition to Employer’s obligations
under Section 6.2(a)(2) and 6.2(b), Employee shall have executed and
delivered to Employer a Separation Agreement and General Release in the form attached
hereto as Exhibit A.

       

      6.3.           Death or
Disability.  Employee’s employment will terminate automatically
in the event of Employee’s death or upon notice from Employer in event of his
permanent disability.  Employee’s “permanent disability”
shall have the meaning ascribed to such term in any policy of disability
insurance maintained by Employer (or by Employee,
as the case may be) with respect to Employee or, if no such policy is then in
effect, shall mean Employee’s inability to fully perform his duties hereunder
for any period of at least 75 consecutive days or for a total of
90 days, whether or not consecutive.  Upon termination of
Employee’s employment as aforesaid, all compensation and benefits to Employee
hereunder shall cease and Employer shall pay to the Employee’s heirs or personal
representatives, not later than ten days after the date of termination, any
accrued but unpaid salary, the minimum bonus described in Section 5.2 applied to
the base salary paid through the date of termination, any Tax Gross-Up or
Parachute Tax Gross-Up payment as described in Section 5.5  and unused
vacation as of the date of such termination as required by California
law.

       


      
        
           


        

        
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      7.           Confidentiality.  While
this Agreement is in effect and for a period of five years thereafter, Employee
shall hold and keep secret and confidential all “trade secrets” (within the
meaning of applicable law) and other confidential or proprietary information of
Employer and shall use such information only in the course of performing
Employee’s duties hereunder; provided, however, that with respect to trade
secrets, Employee shall hold and keep secret and confidential such trade secrets
for so long as they remain trade secrets under applicable
law.  Employee shall maintain in trust all such trade secrets or other
confidential or proprietary information, as Employer’s property, including, but
not limited to, all documents concerning Employer’s business, including
Employee’s work papers, telephone directories, customer information and notes,
and any and all copies thereof in Employee’s possession or under Employee’s
control.  Upon the expiration or earlier termination of Employee’s
employment with Employer, or upon request by Employer, Employee shall deliver to
Employer all such documents belonging to Employer, including any and all copies
in Employee’s possession or under Employee’s control.

       

      8.           Equitable Remedies;
Injunctive Relief.  Employee hereby acknowledges and agrees
that monetary damages are inadequate to fully compensate Employer for the
damages that would result from a breach or threatened breach of Section 7 of
this Agreement and, accordingly, that Employer shall be entitled to equitable
remedies, including, without limitation, specific performance, temporary
restraining orders, and preliminary injunctions and permanent injunctions, to
enforce such Section without the necessity of proving actual damages in
connection therewith.  This provision shall not, however, diminish
Employer’s right to claim and recover damages or enforce any other of its legal
or equitable rights or defenses.

       

      9.           Indemnification;
Insurance.  Employer and Employee acknowledge that, as the
Chief Medical Officer of the Employer, Employee shall be a corporate officer of
Employer and, as such, Employee shall be entitled to indemnification to the full
extent provided by Employer to its officers, directors and agents under the
Employer’s Certificate of Incorporation and Bylaws as in effect as of the date
of this Agreement.  Subject to his insurability thereunder1, effective on the Effective Date, Employer
shall add Employee as an additional insured under its current policy of
directors and officers liability insurance and shall use commercially reasonable
efforts to continue to insure Employee thereunder, or under any replacement
policies in effect from time to time, during the Term.

       

      10.           Severable
Provisions.  The provisions of this Agreement are severable and
if any one or more provisions is determined to be illegal or otherwise
unenforceable, in whole or in part, the remaining provisions, and any partially
unenforceable provisions to the extent enforceable, shall nevertheless be
binding and enforceable.

       

      11.           Successors and
Assigns.  This Agreement shall inure to the benefit of and
shall be binding upon Employer, its successors and assigns and Employee and his
heirs and representatives; provided, however, that neither party may assign this
Agreement without the prior written consent of the other party.

       

      12.           Entire
Agreement.  This Agreement contains the entire agreement of the
parties relating to the subject matter hereof, and the parties hereto have made
no agreements, representations or warranties relating to the subject matter of
this Agreement that are not set forth otherwise herein.  This
Agreement supersedes any and all prior or contemporaneous agreements, written or
oral, between Employee and Employer relating to the subject matter
hereof.  Any such prior or contemporaneous agreements are hereby
terminated and of no further effect, and Employee, by the execution hereof,
agrees that any compensation provided for under any such agreements is
specifically superseded and replaced by the provisions of this
Agreement.

       

      
        
          
          

        

        
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      13.           Amendment.  No
modification of this Agreement shall be valid unless made in writing and signed
by the parties hereto and unless such writing is made by an executive officer of
Employer (other than Employee).  The parties hereto agree that in no
event shall an oral modification of this Agreement be enforceable or
valid.

       

      14.           Governing
Law.  This Agreement is and shall be governed and construed in
accordance with the laws of the State of California without giving effect to
California’s choice-of-law rules.

       

      15.           Notice.  All
notices and other communications under this Agreement shall be in writing and
mailed, telecopied (in case of notice to Employer only) or delivered by hand or
by a nationally recognized courier service guaranteeing overnight delivery to a
party at the following address (or to such other address as such party may have
specified by notice given to the other party pursuant to this
provision):

       

      
        	
                       If to
      Employer:

                 

                       CytRx
      Corporation

                       11726
      San Vicente Boulevard, Suite 650

                       Los
      Angeles, California  90049

                       Facsimile:                  (310)
      826-5529

                       Attention:                  Chief
      Executive Officer

              
	
                 

                       If to
      Employee:

                 

                       Daniel
      Levitt, M.D., Ph.D.

                       __________________

                       __________________

                 

              


      

      16.           Survival.  Sections
5.5, 6.2., 6.3, 7 through 16 and 18 shall survive the expiration or termination
of this Agreement.

       

      17.           Counterparts.  This
Agreement may be executed in counterparts, each of which shall be deemed to be
an original and all of which together shall be deemed to be one and the same
agreement.  A counterpart executed and transmitted by facsimile shall
have the same force and effect as an originally executed
counterpart.

       

      18.           Attorney’s
Fees.  In any action or proceeding to construe or enforce any
provision of this Agreement the prevailing party shall be entitled to recover
its or his reasonable attorneys’ fees and other costs of suit (up to a maximum
of $15,000) in addition to any other recoveries.

       

      IN
WITNESS WHEREOF, this Agreement is executed as of the day and year first above
written.

       

      
        	 
      	
                “EMPLOYER”

                 

                CytRx
      Corporation

                 

                 

                By:
      /s/ STEVEN A.
      KRIEGSMAN                                                               

                Steven A.
Kriegsman

                President & Chief Executive
      Officer

              
	 
      	
                 

                 

                 

                “EMPLOYEE”

                 

                 

                /s/ DANIEL
      LEVITT                                                               

                Daniel
      Levitt, M.D., Ph.D.

              


      

      


       

      
        
           


        

        
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