Document:

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                                                                    EXHIBIT 10.2

                          SECURITIES PURCHASE AGREEMENT

      This Securities Purchase Agreement (this "Agreement") is dated as of
October 4, 2004, among CytRx Corporation, a Delaware corporation (the
"Company"), and the purchasers identified on the signature pages hereto (each,
including its successors and assigns, a "Purchaser" and collectively the
"Purchasers").

      WHEREAS, subject to the terms and conditions set forth in this Agreement
and pursuant to Section 4(2) of the Securities Act of 1933, as amended (the
"Securities Act"), and Rule 506 promulgated thereunder, the Company desires to
issue and sell to each Purchaser, and each Purchaser, severally and not jointly,
desires to purchase from the Company, securities of the Company as more fully
described in this Agreement.

      NOW, THEREFORE, IN CONSIDERATION of the mutual covenants contained in this
Agreement, and for other good and valuable consideration the receipt and
adequacy of which are hereby acknowledged, the Company and each Purchaser agrees
as follows:

                                   ARTICLE I.
                                   DEFINITIONS

      1.1 1.1 Definitions. In addition to the terms defined elsewhere in this
Agreement, for all purposes of this Agreement, the following terms have the
meanings indicated in this Section 1.1:

            "Action" shall have the meaning ascribed to such term in Section
      3.1(j).

            "Affiliate" means any Person that, directly or indirectly through
      one or more intermediaries, controls or is controlled by or is under
      common control with a Person, as such terms are used in and construed
      under Rule 144 under the Securities Act. With respect to a Purchaser, any
      investment fund or managed account that is managed on a discretionary
      basis by the same investment manager as such Purchaser will be deemed to
      be an Affiliate of such Purchaser.

            "Closing" means the closing of the purchase and sale of the Shares
      and Warrant Shares pursuant to Section 2.1.

            "Closing Date" means the Trading Day when all of the Transaction
      Documents have been executed and delivered by the applicable parties
      thereto, and all conditions precedent to (a) the Purchasers' obligations
      to pay the Subscription Amount have been satisfied or waived and (b) the
      Company's obligations to deliver the Securities have been satisfied or
      waived.

            "Closing Price" means on any particular date (a) the last reported
      closing bid price per share of Common Stock on such date on the Trading
      Market (as reported by Bloomberg L.P. at 4:15 PM (New York time), or (b)
      if there is no such price on such date, then the closing bid price on the
      Trading Market on the date nearest preceding such

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      date (as reported by Bloomberg L.P. at 4:15 PM (New York time) for the
      closing bid price for regular session trading on such day), or (c) if the
      Common Stock is not then listed or quoted on the Trading Market and if
      prices for the Common Stock are then reported in the "pink sheets"
      published by the National Quotation Bureau Incorporated (or a similar
      organization or agency succeeding to its functions of reporting prices),
      the most recent bid price per share of the Common Stock so reported, or
      (d) if the shares of Common Stock are not then publicly traded the fair
      market value of a share of Common Stock as determined by an appraiser
      selected in good faith by the Purchasers of a majority in interest of the
      Shares then outstanding.

            "Commission" means the Securities and Exchange Commission.

            "Common Stock" means the common stock of the Company, par value
      $0.001 per share, and any securities into which such common stock shall
      hereinafter have been reclassified into.

            "Common Stock Equivalents" means any securities of the Company or
      the Subsidiaries which would entitle the holder thereof to acquire at any
      time Common Stock, including without limitation, any debt, preferred
      stock, rights, options, warrants or other instrument that is at any time
      convertible into or exchangeable for, or otherwise entitles the holder
      thereof to receive, Common Stock.

            "Company Counsel" means Troy & Gould Professional Corporation,
      counsel to the Company.

            "Disclosure Schedules" shall have the meaning ascribed to such term
      in Section 3.1 hereof.

            "Effective Date" means the date that the Registration Statement
      filed by the Company pursuant to the Registration Rights Agreement is
      first declared effective by the Commission.

            "Escrow Agent" shall have the meaning set forth in the Escrow
      Agreement.

            "Escrow Agreement" shall mean the Escrow Agreement in substantially
      the form of Exhibit D hereto executed and delivered contemporaneously with
      this Agreement.

            "Exchange Act" means the Securities Exchange Act of 1934, as
      amended.

            "Exempt Issuance" means the issuance of (a) shares of Common Stock
      or options to employees, officers or directors of the Company pursuant to
      any stock or option plan duly adopted by a majority of the non-employee
      members of the Board of Directors of the Company or a majority of the
      members of a committee of non-employee directors established for such
      purpose, (b) securities upon the exercise of or conversion of any
      securities issued hereunder, convertible securities, options and warrants
      issued and outstanding on the date of this Agreement, provided that such
      securities have not been amended since the date of this Agreement to
      increase the number of such securities, (c)

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      securities issuable pursuant to anti-dilution adjustment provisions,
      liquidated damages provisions or similar provisions of any convertible
      securities, options, warrants and other agreements outstanding on the date
      of this agreement, and (d) securities issued pursuant to acquisitions or
      strategic transactions, provided any such issuance shall only be to a
      Person which is, itself or through its subsidiaries, a research and
      development company or an operating company in a business synergistic with
      the business of the Company and in which the Company receives benefits in
      addition to the investment of funds, but shall not include a transaction
      in which the Company is issuing securities primarily for the purpose of
      raising capital or to an entity whose primary business is investing in
      securities.

            "FW" means Feldman Weinstein LLP with offices at 420 Lexington
      Avenue, Suite 2620, New York, New York 10170-0002, counsel to Rodman &
      Renshaw, Inc., the placement agent to the transaction.

            "GAAP" shall have the meaning ascribed to such term in Section
      3.1(h) hereof.

            "Knowledge" means the following: a Person other than a natural
      person will be deemed to have Knowledge of a particular fact or other
      matter if any natural person who is serving as a director or executive
      officer of such Person, after due inquiry, has actual knowledge of a
      particular fact or matter.

            "Liens" means a lien, charge, security interest, encumbrance, right
      of first refusal, preemptive right or other restriction.

            "Losses" means any and all losses, claims, damages, liabilities,
      settlement costs and expenses, including costs of preparation and
      reasonable attorneys' fees.

            "Material Adverse Effect" shall have the meaning assigned to such
      term in Section 3.1(b) hereof.

            "Material Permits" shall have the meaning ascribed to such term in
      Section 3.1(m).

            "Per Share Purchase Price" equals $1.00, subject to adjustment for
      reverse and forward stock splits, stock dividends, stock combinations and
      other similar transactions of the Common Stock that occur after the date
      of this Agreement.

            "Person" means an individual or corporation, partnership, trust,
      incorporated or unincorporated association, joint venture, limited
      liability company, joint stock company, government (or an agency or
      subdivision thereof) or other entity of any kind.

            "Registration Rights Agreement" means the Registration Rights
      Agreement, dated the date hereof, among the Company and the Purchasers, in
      the form of Exhibit A attached hereto.

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            "Registration Statement" means a registration statement meeting the
      requirements set forth in the Registration Rights Agreement and covering
      the resale by the Purchasers of the Shares and the Warrant Shares.

            "Required Approvals" shall have the meaning ascribed to such term in
      Section 3.1(e).

            "Rule 144" means Rule 144 promulgated by the Commission pursuant to
      the Securities Act, as such Rule may be amended from time to time, or any
      similar rule or regulation hereafter adopted by the Commission having
      substantially the same effect as such Rule.

            "SEC Reports" shall have the meaning ascribed to such term in
      Section 3.1(h) hereof.

            "Securities" means the Shares, the Warrants and the Warrant Shares.

            "Securities Act" means the Securities Act of 1933, as amended.

            "Shares" means the shares of Common Stock issued or issuable to each
      Purchaser pursuant to this Agreement.

            "Subscription Amount" means, as to each Purchaser, the aggregate
      amount to be paid for Shares and Warrants purchased hereunder as specified
      below such Purchaser's name on the signature page of this Agreement and
      next to the heading "Subscription Amount", in United States Dollars and in
      immediately available funds.

            "Subsidiary" means any subsidiary of the Company as set forth on
      Schedule 3.1(a).

            "Trading Day" means a day on which the Common Stock is traded on a
      Trading Market.

            "Trading Market" means the following markets or exchanges on which
      the Common Stock is listed or quoted for trading on the date in question:
      the Nasdaq SmallCap Market, the American Stock Exchange, the New York
      Stock Exchange or the Nasdaq National Market.

            "Transaction Documents" means this Agreement, the Warrants, the
      Registration Rights Agreement, the Escrow Agreement and any other
      documents or agreements executed in connection with the transactions
      contemplated hereunder.

            "VWAP" means, for any date, the price determined by the first of the
      following clauses that applies: (a) if the Common Stock is then listed or
      quoted on a Trading Market, the daily volume weighted average price of the
      Common Stock for such date (or the nearest preceding date) on the Trading
      Market on which the Common Stock is then listed or quoted as reported by
      Bloomberg Financial L.P. (based on a Trading Day from

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      9:30 a.m. Eastern Time to 4:00 p.m. Eastern Time); (b) if the Common Stock
      is not then listed or quoted on the Trading Market and if prices for the
      Common Stock is then quoted on the OTC Bulletin Board, the volume weighted
      average price of the Common Stock for such date (or the nearest preceding
      date) on the OTC Bulletin Board (c) if the Common Stock is not then listed
      or quoted on the OTC Bulletin Board and if prices for the Common Stock are
      then reported in the "Pink Sheets" published by the National Quotation
      Bureau Incorporated (or a similar organization or agency succeeding to its
      functions of reporting prices), the most recent bid price per share of the
      Common Stock so reported prior to the day in question; or (d) in all other
      cases, the fair market value of a share of Common Stock as determined by
      an independent appraiser selected in good faith by the Purchasers holding
      a majority of the Shares and reasonably acceptable to the Company.

            "Warrants" means collectively the Common Stock purchase warrants,
      exercisable commencing immediately and with a term of exercise of 5 years
      and an exercise price equal to $1.72 per share, in the form of Exhibit B
      delivered to the Purchasers at the Closing in accordance with Section 2.2
      hereof.

            "Warrant Shares" means the shares of Common Stock issuable upon
      exercise of the Warrants.

      1.2   Interpretation. Unless the context otherwise requires, the
terms defined in this Article 1 shall have the meanings herein specified for all
purposes of this Agreement and in the other Transaction Documents, applicable to
both the singular and plural forms of any of the terms defined herein. When a
reference is made in this Agreement to a Section, such reference shall be to a
Section of this Agreement unless otherwise indicated. Whenever the words
"include," "includes" or "including" are used in the Transaction Documents, they
shall be deemed to be followed by the words "without limitation." The use of any
gender in the Transaction Documents shall be deemed to include the neuter,
masculine and feminine genders wherever necessary or appropriate.

                                   ARTICLE II.
                                PURCHASE AND SALE

      2.1   Closing. On the Closing Date, upon the terms and subject to the
conditions set forth herein, concurrent with the execution and delivery of this
Agreement by the parties hereto, the Company agrees to sell, and each Purchaser
agrees to purchase in the aggregate, severally and not jointly, up to $4,000,000
of Common Stock and Warrants. At the Closing, each Purchaser shall deliver its
Subscription Amount, and the Company shall deliver to each Purchaser such
Purchaser's Securities as determined pursuant to Section 2.2(a), and each
Purchaser and the Company shall deliver the other items set forth in Section 2.2
deliverable at the Closing. Upon satisfaction of the conditions set forth in
Section 2.2, the Closing shall occur at the offices of Escrow Agent, or such
other location as the parties shall mutually agree.

      2.2   Deliverables.

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            (a) At or prior to the Closing Date the Company shall deliver or
      cause to be delivered to the Escrow Agent with respect to each Purchaser
      the following:

                  (i) a copy of the irrevocable instructions to the Company's
            transfer agent instructing the transfer agent to deliver, on an
            expedited basis, a certificate evidencing a number of Shares equal
            to such Purchaser's Subscription Amount divided by the Per Share
            Purchase Price, registered in the name of such Purchaser;

                  (ii) a Warrant registered in the name of such Purchaser to
            purchase up to a number of shares of Common Stock equal to 70% of
            the Shares purchased by such Purchaser;

                  (iii) the legal opinion of Company Counsel substantially to
            the effects set forth in Exhibit C attached hereto, addressed to the
            Purchasers;

                  (iv) the Registration Rights Agreement duly executed by the
            Company;

                  (v) the Escrow Agreement duly executed by the Company; and

                  (vi) this Agreement, duly executed by the Company.

            (b) At or prior to the Closing, each Purchaser shall deliver or
      cause to be delivered to the Escrow Agent the following:

                  (i) such Purchaser's Subscription Amount by wire transfer of
            immediately available funds to the account of the Escrow Agent;

                  (ii) this Agreement, duly executed by such Purchaser;

                  (iii) the Registration Rights Agreement duly executed by such
            Purchaser; and

                  (iv) the Escrow Agreement duly executed by such Purchaser.

      2.3   Closing Conditions.

            a) The obligations of the Company hereunder in connection with the
      Closing are subject to the following conditions being met:

                  (i) the accuracy in all material respects when made and on the
            Closing Date of the representations and warranties of the Purchasers
            contained herein;

                  (ii) all obligations, covenants and agreements of the
            Purchasers required to be performed at or prior to the Closing Date
            shall have been performed;

                  (iii) the delivery by the Purchasers of the items set forth in
            Section 2.2(b) of this Agreement; and

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                  (iv) the Company shall have entered into definitive agreements
            for the consummation of purchase of all of the assets of Biorex
            Research and Development Company, RT on or before 9:30 am Eastern
            Time on October 6, 2004.

            b) The respective obligations of the Purchasers hereunder in
      connection with the Closing are subject to the following conditions being
      met:

                  (i) the accuracy in all material respects on the Closing Date
            of the representations and warranties of the Company contained
            herein;

                  (ii) all obligations, covenants and agreements of the Company
            required to be performed at or prior to the Closing Date shall have
            been performed;

                  (iii) the delivery by the Company of the items set forth in
            Section 2.2(a) of this Agreement;

                  (iv) there shall have been no Material Adverse Effect with
            respect to the Company since the date hereof;

                  (v) From the date hereof to the Closing Date, trading in the
            Common Stock shall not have been suspended by the Commission (except
            for any suspension of trading of limited duration agreed to by the
            Company, which suspension shall be terminated prior to the Closing),
            and, at any time prior to the Closing Date, trading in securities
            generally as reported by Bloomberg Financial Markets shall not have
            been suspended or limited, or minimum prices shall not have been
            established on securities whose trades are reported by such service,
            or on any Trading Market, nor shall a banking moratorium have been
            declared either by the United States or New York State authorities
            nor shall there have occurred any material outbreak or escalation of
            hostilities or other national or international calamity of such
            magnitude in its effect on, or any material adverse change in, any
            financial market which, in each case, in the reasonable judgment of
            each Purchaser, makes it impracticable or inadvisable to purchase
            the Shares at the Closing; and

                  (vi) The Company shall have entered into definitive agreements
            for the consummation of purchase of all of the assets of Biorex
            Research and Development Company, RT on or before 9:30 am Eastern
            Time on October 6, 2004.

                                  ARTICLE III.
                         REPRESENTATIONS AND WARRANTIES

            3.1 Representations and Warranties of the Company. Except as set
forth under the corresponding section of the disclosure schedules delivered to
the Purchasers concurrently herewith (the "Disclosure Schedules") which
Disclosure Schedules shall be deemed a part

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hereof, the Company hereby makes the representations and warranties set forth
below to each Purchaser.

            (a) Subsidiaries. All of the direct and indirect subsidiaries of the
      Company are set forth on Schedule 3.1(a). The Company owns, directly or
      indirectly, all of the capital stock or other equity interests of each
      Subsidiary free and clear of any Liens, and all the issued and outstanding
      shares of capital stock of each Subsidiary are validly issued and are
      fully paid, non-assessable and free of preemptive and similar rights to
      subscribe for or purchase securities. If the Company has no subsidiaries,
      then references in the Transaction Documents to the Subsidiaries will be
      disregarded.

            (b) Organization and Qualification. Each of the Company and the
      Subsidiaries is an entity duly incorporated or otherwise organized,
      validly existing and in good standing under the laws of the jurisdiction
      of its incorporation or organization (as applicable), with the requisite
      power and authority to own and use its properties and assets and to carry
      on its business as currently conducted. Neither the Company nor any
      Subsidiary is in violation or default of any of the provisions of its
      respective certificate or articles of incorporation, bylaws or other
      organizational or charter documents. Each of the Company and the
      Subsidiaries is duly qualified to conduct business and is in good standing
      as a foreign corporation or other entity in each jurisdiction in which the
      nature of the business conducted or property owned by it makes such
      qualification necessary, except where the failure to be so qualified or in
      good standing, as the case may be, could not have or reasonably be
      expected to result in (i) a material adverse effect on the legality,
      validity or enforceability of any Transaction Document, (ii) a material
      adverse effect on the results of operations, assets, business, prospects
      or financial condition of the Company and the Subsidiaries, taken as a
      whole, or (iii) a material adverse effect on the Company's ability to
      perform in any material respect on a timely basis its obligations under
      any Transaction Document (any of (i), (ii) or (iii), a "Material Adverse
      Effect") and, to the knowledge of the Company, no Action has been
      instituted in any such jurisdiction revoking, limiting or curtailing or
      seeking to revoke, limit or curtail such power and authority or
      qualification.

            (c) Authorization; Enforcement. The Company has the requisite
      corporate power and authority to enter into and to consummate the
      transactions contemplated by each of the Transaction Documents and
      otherwise to carry out its obligations thereunder. The execution and
      delivery of each of the Transaction Documents by the Company and the
      consummation by it of the transactions contemplated thereby have been duly
      authorized by all necessary action on the part of the Company and no
      further action is required by the Company in connection therewith other
      than in connection with the Required Approvals. Each Transaction Document
      has been (or upon delivery will have been) duly executed by the Company
      and, when delivered in accordance with the terms hereof, will constitute
      the valid and binding obligation of the Company enforceable against the
      Company in accordance with its terms except (i) as limited by applicable
      bankruptcy, insolvency, reorganization, moratorium and other laws of
      general application affecting enforcement of creditors' rights generally,
      (ii) as limited by laws relating to the

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      availability of specific performance, injunctive relief or other equitable
      remedies and (iii) insofar as indemnification and contribution provisions
      may be limited by applicable law.

            (d) No Conflicts. The execution, delivery and performance of the
      Transaction Documents by the Company, the issuance and sale of the Shares
      and the consummation by the Company of the other transactions contemplated
      thereby do not and will not: (i) conflict with or violate any provision of
      the Company's or any Subsidiary's certificate or articles of
      incorporation, bylaws or other organizational or charter documents, or
      (ii) conflict with, or constitute a default (or an event that with notice
      or lapse of time or both would become a default) under, result in the
      creation of any Lien upon any of the properties or assets of the Company
      or any Subsidiary, or give to others any rights of termination, amendment,
      acceleration or cancellation (with or without notice, lapse of time or
      both) of, any agreement, credit facility, debt or other instrument
      (evidencing a Company or Subsidiary debt or otherwise) or other
      understanding to which the Company or any Subsidiary is a party or by
      which any property or asset of the Company or any Subsidiary is bound or
      affected, or (iii) subject to the Required Approvals, conflict with or
      result in a violation of any law, rule, regulation, order, judgment,
      injunction, decree or other restriction of any court or governmental
      authority to which the Company or a Subsidiary is subject (including
      federal and state securities laws and regulations), or by which any
      property or asset of the Company or a Subsidiary is bound or affected, or
      (iv) conflict with or violate the terms of any agreement by which the
      Company or any Subsidiary is bound or to which any property or asset of
      the Company or any Subsidiary is bound or affected; except in the case of
      each of clauses (ii) and (iii), such as could not have or reasonably be
      expected to result in a Material Adverse Effect.

            (e) Filings, Consents and Approvals. The Company is not required to
      obtain any consent, waiver, authorization or order of, give any notice to,
      or make any filing or registration with, any court or other federal,
      state, local or other governmental authority or other Person in connection
      with the execution, delivery and performance by the Company of the
      Transaction Documents, other than (i) filings required pursuant to Section
      4.6, (ii) the filing with the Commission of the Registration Statement,
      (iii) the notice and/or application(s) to each applicable Trading Market
      for the listing of the Shares and Warrant Shares for trading thereon in
      the time and manner required thereby, and (iv) the filing of Form D with
      the Commission and such filings as are required to be made under
      applicable state securities laws (collectively, the "Required Approvals").

            (f) Issuance of the Securities. The Shares and Warrants are duly
      authorized and, when issued and paid for in accordance with the applicable
      Transaction Documents, will be duly and validly issued, fully paid and
      nonassessable, free and clear of all Liens imposed by the Company other
      than restrictions on transfer provided for or referred to in the
      Transaction Documents. The Warrant Shares, when issued in accordance with
      the terms of the Transaction Documents, will be validly issued, fully paid
      and nonassessable, free and clear of all Liens imposed by the Company. The
      Company has reserved from its duly authorized capital stock a number of
      shares of Common Stock issuable pursuant to this Agreement and the
      Warrants. The Company has not, and to the knowledge of the Company, no
      Affiliate of the Company has sold, offered for sale or solicited offers to
      buy

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      or otherwise negotiated in respect of any security (as defined in Section
      2 of the Securities Act) that would be integrated with the offer or sale
      of the Securities in a manner that would require the registration under
      the Securities Act of the sale of the Securities to the Purchasers, or
      that would be integrated with the offer or sale of the Securities for
      purposes of the rules and regulations of any Trading Market.

            (g) Capitalization. The capitalization of the Company is as
      described in the Company's most recent SEC Report filed with the
      Commission. The Company has not issued any capital stock since such filing
      other than pursuant to the exercise of employee stock options under the
      Company's stock option plans, the issuance of shares of Common Stock to
      employees pursuant to the Company's employee stock purchase plan and
      pursuant to the conversion or exercise of outstanding Common Stock
      Equivalents. No Person has any right of first refusal, preemptive right,
      right of participation, or any similar right to participate in the
      transactions contemplated by the Transaction Documents. Except as a result
      of the purchase and sale of the Securities and except with respect to
      securities issued pursuant to employee stock option plans or employee
      stock purchase plans, there are no outstanding options, warrants, script
      rights to subscribe to, calls or commitments of any character whatsoever
      relating to, or securities, rights or obligations convertible into or
      exchangeable for, or giving any Person any right to subscribe for or
      acquire, any shares of Common Stock, and no contracts, commitments,
      understandings or arrangements by which the Company or any Subsidiary is
      or may become bound to issue additional shares of Common Stock, or
      securities or rights convertible or exchangeable into shares of Common
      Stock. The issuance and sale of the Securities will not obligate the
      Company to issue shares of Common Stock or other securities to any Person
      (other than the Purchasers) and will not result in a right of any holder
      of Company securities to adjust the exercise, conversion, exchange or
      reset price under such securities. All of the outstanding shares of
      capital stock of the Company are validly issued, fully paid and
      nonassessable, have been issued in compliance with all federal and state
      securities laws, and none of such outstanding shares was issued in
      violation of any preemptive rights or similar rights to subscribe for or
      purchase securities. No further approval or authorization of any
      stockholder, the Board of Directors of the Company or others is required
      for the issuance and sale of the Securities. Except as disclosed in the
      SEC Reports, there are no stockholders agreements, voting agreements or
      other similar agreements with respect to the Company's capital stock to
      which the Company is a party or, to the knowledge of the Company, between
      or among any of the Company's stockholders.

            (h) SEC Reports; Financial Statements. The Company has filed all
      reports required to be filed by it under the Securities Act and the
      Exchange Act, including pursuant to Section 13(a) or 15(d) thereof, for
      the two years preceding the date hereof (or such shorter period as the
      Company was required by law to file such material) (the foregoing
      materials, together with the Post-Effective Amendment on Form S-1 to
      Registration Statement on Form S-3 of the Company filed with the
      Commission on June 2, 2004 and the Company's definitive Schedule 14A filed
      with the Commission on June 30, 2004, in each case, including the exhibits
      thereto, being collectively referred to herein as the "SEC Reports") on a
      timely basis or has received a valid extension of such time of

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      filing and has filed any such SEC Reports prior to the expiration of any
      such extension. As of their respective dates, the SEC Reports complied in
      all material respects with the requirements of the Securities Act and the
      Exchange Act and the rules and regulations of the Commission promulgated
      thereunder, and none of the SEC Reports, when filed, contained any untrue
      statement of a material fact or omitted to state a material fact required
      to be stated therein or necessary in order to make the statements therein,
      in light of the circumstances under which they were made, not misleading.
      The financial statements of the Company included in the SEC Reports comply
      in all material respects with applicable accounting requirements and the
      rules and regulations of the Commission with respect thereto as in effect
      at the time of filing. Such financial statements have been prepared in
      accordance with United States generally accepted accounting principles
      applied on a consistent basis during the periods involved ("GAAP"), except
      as may be otherwise specified in such ---- financial statements or the
      notes thereto and except that unaudited financial statements may not
      contain all footnotes required by GAAP, and fairly present in all material
      respects the financial position of the Company and its consolidated
      Subsidiaries as of and for the dates thereof and the results of operations
      and cash flows for the periods then ended, subject, in the case of
      unaudited statements, to normal, immaterial, year-end audit adjustments.

            (i) Material Changes. Since the date of the latest audited financial
      statements included within the SEC Reports, except as specifically
      disclosed in the SEC Reports, (i) there has been no event, occurrence or
      development that has had or that could reasonably be expected to result in
      a Material Adverse Effect, (ii) the Company has not incurred any
      liabilities (contingent or otherwise) other than (A) trade payables and
      accrued expenses incurred in the ordinary course of business consistent
      with past practice and (B) liabilities not required to be reflected in the
      Company's financial statements pursuant to GAAP or required to be
      disclosed in filings made with the Commission, (iii) the Company has not
      altered its method of accounting, (iv) the Company has not declared or
      made any dividend or distribution of cash or other property to its
      stockholders or purchased, redeemed or made any agreements to purchase or
      redeem any shares of its capital stock and (v) the Company has not issued
      any equity securities to any officer, director or Affiliate, except
      pursuant to existing Company stock option plans. The Company does not have
      pending before the Commission any request for confidential treatment of
      information.

            (j) Litigation. Except as disclosed in the SEC Reports, there is no
      action, suit, inquiry, notice of violation, proceeding or investigation
      pending or, to the knowledge of the Company, threatened against or
      affecting the Company, any Subsidiary or any of their respective
      properties before or by any court, arbitrator, governmental or
      administrative agency or regulatory authority (federal, state, county,
      local or foreign) (collectively, an "Action") which (i) adversely affects
      or challenges the legality, validity or enforceability of any of the
      Transaction Documents or the Securities or (ii) could, if there were an
      unfavorable decision, have or reasonably be expected to result in a
      Material Adverse Effect. Except as disclosed in the SEC Reports, neither
      the Company nor any Subsidiary, nor any director or officer thereof, is or
      has been the subject of any Action involving a claim of violation of or
      liability under federal or state securities laws or a

                                      -11-
<PAGE>

      claim of breach of fiduciary duty. There has not been, and to the
      knowledge of the Company, there is not pending or contemplated, any
      investigation by the Commission involving the Company or any current or
      former director or officer of the Company. The Commission has not issued
      any stop order or other order suspending the effectiveness of any
      registration statement filed by the Company or any Subsidiary under the
      Exchange Act or the Securities Act.

            (k) Labor Relations. No material labor dispute exists or, to the
      knowledge of the Company, is imminent with respect to any of the employees
      of the Company which could reasonably be expected to result in a Material
      Adverse Effect.

            (l) Compliance. Except as disclosed in the SEC Reports, neither the
      Company nor any Subsidiary (i) is in default under or in violation of (and
      no event has occurred that has not been waived that, with notice or lapse
      of time or both, would result in a default by the Company or any
      Subsidiary under), nor has the Company or any Subsidiary received notice
      of a claim that it is in default under or that it is in violation of, any
      indenture, loan or credit agreement or any other agreement or instrument
      to which it is a party or by which it or any of its properties is bound
      (whether or not such default or violation has been waived), (ii) is in
      violation of any order of any court, arbitrator or governmental body, or
      (iii) is or has been in violation of any statute, rule or regulation of
      any governmental authority, including without limitation all foreign,
      federal, state and local laws applicable to its business except in each
      case as could not have a Material Adverse Effect.

            (m) Regulatory Permits. The Company and the Subsidiaries possess all
      certificates, authorizations and permits issued by the appropriate
      federal, state, local or foreign regulatory authorities necessary to
      conduct their respective businesses as described in the SEC Reports,
      except where the failure to possess such permits could not have or
      reasonably be expected to result in a Material Adverse Effect ("Material
      Permits"), and neither the Company nor any Subsidiary has received any
      notice of proceedings relating to the revocation or modification of any
      Material Permit.

            (n) Title to Assets. The Company and the Subsidiaries have good and
      marketable title in fee simple to all real property owned by them that is
      material to the business of the Company and the Subsidiaries and good and
      marketable title in all personal property owned by them that is material
      to the business of the Company and the Subsidiaries, in each case free and
      clear of all Liens, except for Liens as do not materially affect the value
      of such property and do not materially interfere with the use made and
      proposed to be made of such property by the Company and the Subsidiaries
      and Liens for the payment of federal, state or other taxes, the payment of
      which is neither delinquent nor subject to penalties. Any real property
      and facilities held under lease by the Company and the Subsidiaries are
      held by them under valid, subsisting and enforceable leases of which the
      Company and the Subsidiaries are in compliance.

            (o) Patents and Trademarks. The Company and the Subsidiaries have,
      or have rights to use, all patents, patent applications, trademarks,
      trademark applications, service

                                      -12-
<PAGE>

      marks, trade names, copyrights, licenses and other similar rights
      necessary or material for use in connection with their respective
      businesses as described in the SEC Reports and which the failure to so
      have could have a Material Adverse Effect (collectively, the "Intellectual
      Property Rights"). Neither the Company nor any Subsidiary has received a
      written notice that the Intellectual Property Rights used by the Company
      or any Subsidiary violates or infringes upon the rights of any Person. To
      the knowledge of the Company, all such Intellectual Property Rights are
      enforceable and there is no existing infringement by another Person of any
      of the Intellectual Property Rights of others.

            (p) Insurance. The Company and the Subsidiaries are insured by
      insurers of recognized financial responsibility against such losses and
      risks and in such amounts as are prudent and customary in the businesses
      in which the Company and the Subsidiaries are engaged. Neither the Company
      nor any Subsidiary has any reason to believe that it will not be able to
      renew its existing insurance coverage as and when such coverage expires or
      to obtain similar coverage from similar insurers as may be necessary to
      continue its business.

            (q) Transactions With Affiliates and Employees. Except as set forth
      in the SEC Reports, none of the officers or directors of the Company and,
      to the knowledge of the Company, none of the employees of the Company is
      presently a party to any transaction with the Company or any Subsidiary
      (other than for services as employees, officers and directors), including
      any contract, agreement or other arrangement providing for the furnishing
      of services to or by, providing for rental of real or personal property to
      or from, or otherwise requiring payments to or from any officer, director
      or such employee or, to the knowledge of the Company, any entity in which
      any officer, director, or any such employee has a substantial interest or
      is an officer, director, trustee or partner, in each case in excess of
      $60,000 other than (i) for payment of salary or consulting fees for
      services rendered, (ii) reimbursement for expenses incurred on behalf of
      the Company and (iii) for other employee benefits, including stock option
      agreements under any stock option plan of the Company.

            (r) Sarbanes-Oxley; Internal Accounting Controls. The Company is in
      material compliance with all provisions of the Sarbanes-Oxley Act of 2002
      which are applicable to it as of the Closing Date. The Company and the
      Subsidiaries maintain a system of internal accounting controls sufficient
      to provide reasonable assurance that (i) transactions are executed in
      accordance with management's general or specific authorizations, (ii)
      transactions are recorded as necessary to permit preparation of financial
      statements in conformity with GAAP and to maintain asset accountability,
      (iii) access to assets is permitted only in accordance with management's
      general or specific authorization, and (iv) the recorded accountability
      for assets is compared with the existing assets at reasonable intervals
      and appropriate action is taken with respect to any differences. The
      Company's certifying officers have evaluated the effectiveness of the
      Company's controls and procedures as of the date prior to the filing date
      of the most recently filed periodic report under the Exchange Act (such
      date, the "Evaluation Date"). The Company presented in its most recently
      filed periodic report under the Exchange Act the conclusions of the
      certifying officers about the effectiveness of the disclosure controls

                                      -13-
<PAGE>

      and procedures based on their evaluations as of the Evaluation Date. Since
      the Evaluation Date, there have been no significant changes in the
      Company's internal controls (as such term is defined in Item 307(b) of
      Regulation S-K under the Exchange Act) or, to the Company's knowledge, in
      other factors that could significantly affect the Company's internal
      controls.

            (s) Certain Fees. No brokerage or finder's fees or commissions are
      or will be payable by the Company to any broker, financial advisor or
      consultant, finder, placement agent, investment banker, bank or other
      Person with respect to the transactions contemplated by this Agreement.
      The Purchasers shall have no obligation with respect to any fees or with
      respect to any claims made by or on behalf of other Persons for fees of a
      type contemplated in this Section that may be due in connection with the
      transactions contemplated by this Agreement.

            (t) Trading Market. The issuance and sale of the Securities
      hereunder does not contravene the rules and regulations of the Trading
      Market.

            (u) Investment Company. The Company is not, and is not an Affiliate
      of, and immediately after receipt of payment for the Shares, will not be
      or be an Affiliate of, an "investment company" within the meaning of the
      Investment Company Act of 1940, as amended. The Company shall conduct its
      business in a manner so that it will not become subject to the Investment
      Company Act.

            (v) Registration Rights. No Person has any right to cause the
      Company to effect the registration under the Securities Act of any
      securities of the Company.

            (w) Listing and Maintenance Requirements. The Company's Common Stock
      is registered pursuant to Section 12(g) of the Exchange Act, and the
      Company has taken no action designed to, or which to its knowledge is
      likely to have the effect of, terminating the registration of the Common
      Stock under the Exchange Act nor has the Company received any notification
      that the Commission is contemplating terminating such registration. The
      Company has not, in the 12 months preceding the date hereof, received
      notice from any Trading Market on which the Common Stock is or has been
      listed or quoted to the effect that the Company is not in compliance with
      the listing or maintenance requirements of such Trading Market. The
      Company is, and has no reason to believe that it will not in the
      foreseeable future continue to be, in compliance with all such listing and
      maintenance requirements.

            (x) Application of Takeover Protections. The Company and its Board
      of Directors have taken all necessary action, if any, in order to render
      inapplicable any control share acquisition, business combination, poison
      pill (including any distribution under a rights agreement) or other
      similar anti-takeover provision under the Company's Certificate of
      Incorporation (or similar charter documents) or the laws of its state of
      incorporation that is or could become applicable to the Purchasers as a
      result of the Purchasers and the Company fulfilling their obligations or
      exercising their rights under

                                      -14-
<PAGE>

      the Transaction Documents, including without limitation as a result of the
      Company's issuance of the Securities and the Purchasers' ownership of the
      Securities.

            (y) Disclosure. The Company confirms that neither it nor any other
      Person acting on its behalf has provided any of the Purchasers or their
      agents or counsel with any information that constitutes or might
      constitute material, nonpublic information of the Company. The Company
      understands and confirms that the Purchasers will rely on the foregoing
      representations and covenants in effecting transactions in securities of
      the Company. The Company acknowledges and agrees that no Purchaser makes
      or has made any representations or warranties with respect to the
      transactions contemplated hereby other than those specifically set forth
      in Section 3.2 hereof.

            (z) No Integrated Offering. Assuming the accuracy of the Purchasers'
      representations and warranties set forth in Section 3.2, neither the
      Company, nor any of its affiliates, nor any Person acting on its or their
      behalf has, directly or indirectly, made any offers or sales of any
      security or solicited any offers to buy any security, under circumstances
      that would cause this offering of the Securities to be integrated with
      prior offerings by the Company for purposes of the Securities Act or any
      applicable shareholder approval provisions, including, without limitation,
      under the rules and regulations of any exchange or automated quotation
      system on which any of the securities of the Company are listed or
      designated.

            (aa) Form S-3 Eligibility. The Company is eligible to register the
      resale of its Common Stock by the Purchasers under Form S-3 promulgated
      under the Securities Act.

            (bb) Tax Status. Except for matters that would not, individually or
      in the aggregate, have or reasonably be expected to result in a Material
      Adverse Effect, the Company and each Subsidiary has filed all necessary
      federal, state and foreign income and franchise tax returns and has paid
      or accrued all taxes shown as due thereon, and the Company has no
      knowledge of a tax deficiency which has been asserted or threatened
      against the Company or any Subsidiary.

            (cc) No General Solicitation. Neither the Company nor, to the
      knowledge of the Company, any Person acting on behalf of the Company has
      offered or sold any of the Shares by any form of general solicitation or
      general advertising. The Company and, to the knowledge of the Company, any
      Person acting on behalf of the Company has offered the Shares for sale
      only to the Purchasers and certain other "qualified purchasers" within the
      meaning of Section 18(b)(3) under the Securities Act.

            (dd) Foreign Corrupt Practices. Neither the Company, nor to the
      knowledge of the Company, any agent or other person acting on behalf of
      the Company, has (i) directly or indirectly, used any corrupt funds for
      unlawful contributions, gifts, entertainment or other unlawful expenses
      related to foreign or domestic political activity, (ii) made any unlawful
      payment to foreign or domestic government officials or employees or to any
      foreign or domestic political parties or campaigns from corporate funds,
      (iii) failed to disclose fully any contribution made by the Company (or
      made by any person acting on

                                      -15-
<PAGE>

      its behalf of which the Company is aware) which is in violation of law, or
      (iv) violated in any material respect any provision of the Foreign Corrupt
      Practices Act of 1977, as amended

            (ee) Accountants. The Company's accountants are set forth on
      Schedule 3.1(ee) of the Disclosure Schedule. To the Company's knowledge,
      such accountants, who the Company expects will express their opinion with
      respect to the financial statements to be included in the Company's Annual
      Report on Form 10-K for the year ending December 31, 2004, are independent
      accountants as required by the Securities Act.

            (ff) No Disagreements with Accountants and Lawyers. Except as
      disclosed in the SEC Reports, there are no disagreements of any kind
      presently existing, or reasonably anticipated by the Company to arise,
      between the accountants and lawyers formerly or presently employed by the
      Company and the Company is current with respect to any fees owed to its
      accountants and lawyers.

            (gg) Acknowledgment Regarding Purchasers' Purchase of Securities.
      The Company acknowledges and agrees that each of the Purchasers is acting
      solely in the capacity of an arm's length purchaser with respect to the
      Transaction Documents and the transactions contemplated hereby. The
      Company further acknowledges that no Purchaser is acting as a financial
      advisor or fiduciary of the Company (or in any similar capacity) with
      respect to this Agreement and the transactions contemplated hereby and any
      advice given by any Purchaser or any of their respective representatives
      or agents in connection with this Agreement and the transactions
      contemplated hereby is merely incidental to the Purchasers' purchase of
      the Securities. The Company further represents to each Purchaser that the
      Company's decision to enter into this Agreement has been based solely on
      the independent evaluation of the transactions contemplated hereby by the
      Company and its representatives.

      3.2   Representations and Warranties of the Purchasers. Each Purchaser
hereby, for itself and for no other Purchaser, represents and warrants to the
Company as follows:

            (a) Organization; Authority. Such Purchaser is an entity duly
      organized, validly existing and in good standing under the laws of the
      jurisdiction of its organization with full right, corporate or partnership
      power and authority to enter into and to consummate the transactions
      contemplated by the Transaction Documents and otherwise to carry out its
      obligations thereunder. The execution, delivery and performance by such
      Purchaser of the transactions contemplated by this Agreement have been
      duly authorized by all necessary corporate or similar action on the part
      of such Purchaser. Each Transaction Document to which it is a party has
      been duly executed by such Purchaser, and when delivered by such Purchaser
      in accordance with the terms hereof, will constitute the valid and legally
      binding obligation of such Purchaser, enforceable against it in accordance
      with its terms, except (i) as limited by general equitable principles and
      applicable bankruptcy, insolvency, reorganization, moratorium and other
      laws of general application affecting enforcement of creditors' rights
      generally, (ii) as limited by laws

                                      -16-
<PAGE>

      relating to the availability of specific performance, injunctive relief or
      other equitable remedies and (iii) insofar as indemnification and
      contribution provisions may be limited by applicable law.

            (b) Purchaser Representation. Such Purchaser understands that the
      Securities are "restricted securities" within the meaning of Rule 144 and
      have not been registered under the Securities Act or any applicable state
      securities law and is acquiring the Securities as principal for its own
      account and not with a view to or for distributing or reselling such
      Securities or any part thereof, has no present intention of distributing
      any of such Securities and has no arrangement or understanding with any
      other persons regarding the distribution of such Securities (this
      representation and warranty not limiting such Purchaser's right to sell
      the Securities pursuant to the Registration Statement or otherwise in
      compliance with applicable federal and state securities laws). Such
      Purchaser is acquiring the Securities hereunder in the ordinary course of
      its business. Such Purchaser does not have any agreement or understanding,
      directly or indirectly, with any Person to distribute any of the
      Securities.

            (c) Purchaser Status. At the time such Purchaser was offered the
      Securities, it was, and at the date hereof it is, and on each date on
      which it exercises any Warrants, it will be either: (i) an "accredited
      investor" as defined in Rule 501(a)(1), (a)(2), (a)(3), (a)(7) or (a)(8)
      under the Securities Act or (ii) a "qualified institutional buyer" as
      defined in Rule 144A(a) under the Securities Act. Such Purchaser is not
      required to be registered as a broker-dealer under Section 15 of the
      Exchange Act.

            (d) Experience of Such Purchaser. Such Purchaser, either alone or
      together with its representatives, has such knowledge, sophistication and
      experience in business and financial matters so as to be capable of
      evaluating the merits and risks of the prospective investment in the
      Securities, and has so evaluated the merits and risks of such investment.
      Such Purchaser is able to bear the economic risk of an investment in the
      Securities and, at the present time, is able to afford a complete loss of
      such investment.

            (e) General Solicitation. Such Purchaser is not purchasing the
      Securities as a result of any advertisement, article, notice or other
      communication regarding the Securities published in any newspaper,
      magazine or similar media or broadcast over television or radio or
      presented at any seminar or any other general solicitation or general
      advertisement.

            (f) Short Sales. Each Purchaser represents that from the date it was
      presented with a term sheet from Rodman & Renshaw, Inc. relating to this
      transaction until the issuance of the initial press release pursuant to
      Section 4.6, neither it nor any Person over whom it has direct control has
      made any short sales of, or granted any option for the purchase of or
      entered into any hedging or similar transaction with the same economic
      effect as a short sale, in the Common Stock.

            (g) Biorex Information. The Purchaser acknowledges and agrees that
      any and all information provided to it regarding the business or assets of
      Biorex Research and

                                      -17-
<PAGE>

      Development Company, RT ("Biorex") was compiled by the Company from
      information available, or made available, to the Company. Purchaser
      acknowledges and agrees that Rodman & Renshaw, Inc. has not performed any
      due diligence review of such information or has not passed on the accuracy
      or completeness of such information. Additionally, while the Company has
      performed its own due diligence review of Biorex for purposes of its
      acquisition of the Biorex assets, the Company does not pass on the
      accuracy or completeness of the information provided to such Purchaser
      other than to represent that, the Company does not know of any material
      inaccuracy in such information.

                                  ARTICLE IV.
                         OTHER AGREEMENTS OF THE PARTIES

      4.1   Transfer Restrictions.

            (a) The Securities may only be disposed of in compliance with state
      and federal securities laws. In connection with any transfer of Securities
      other than pursuant to an effective registration statement or Rule 144, to
      the Company or to an Affiliate of a Purchaser or in connection with a
      pledge as contemplated in Section 4.1(b), the Company may require the
      transferor thereof to provide to the Company an opinion of counsel
      selected by the transferor and reasonably acceptable to the Company, the
      form and substance of which opinion and shall be reasonably satisfactory
      to the Company, to the effect that such transfer does not require
      registration of such transferred Securities under the Securities Act. As a
      condition of transfer, any such transferee shall agree in writing to be
      bound by the terms of this Agreement and shall have the rights of a
      Purchaser under this Agreement and the Registration Rights Agreement.

            (b) The Purchasers agree to the imprinting, so long as is required
      by this Section 4.1(b), of a legend on any of the Securities in the
      following form:

                  NEITHER THIS SECURITY NOR THE SECURITIES INTO WHICH THIS
                  SECURITY IS EXERCISABLE HAVE BEEN REGISTERED WITH THE
                  SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES
                  COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM
                  REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
                  "SECURITIES ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED OR
                  SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
                  UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION
                  FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
                  REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH
                  APPLICABLE STATE SECURITIES LAWS AS EVIDENCED BY A LEGAL
                  OPINION OF COUNSEL TO THE TRANSFEROR TO SUCH EFFECT, THE
                  SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE
                  COMPANY. THIS SECURITY AND THE

                                      -18-
<PAGE>

                  SECURITIES ISSUABLE UPON EXERCISE OF THIS SECURITY MAY BE
                  PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER
                  LOAN SECURED BY SUCH SECURITIES.

            The Company acknowledges and agrees that a Purchaser may from time
      to time pledge pursuant to a bona fide margin agreement with a registered
      broker-dealer or grant a security interest in some or all of the
      Securities to a financial institution that is an "accredited investor" as
      defined in Rule 501(a) under the Securities Act and who agrees to be bound
      by the provisions of this Agreement and the Registration Rights Agreement
      and, if required under the terms of such arrangement, such Purchaser may
      transfer pledged or secured Securities to the pledgees or secured parties.
      Such a pledge or transfer would not be subject to approval of the Company
      and no legal opinion of legal counsel of the pledgee, secured party or
      pledgor shall be required in connection therewith. Further, no notice
      shall be required of such pledge. At the appropriate Purchaser's expense,
      the Company will execute and deliver such reasonable documentation as a
      pledgee or secured party of Securities may reasonably request in
      connection with a pledge or transfer of the Securities, including, if the
      Securities are subject to registration pursuant to the Registration Rights
      Agreement, the preparation and filing of any required prospectus
      supplement under Rule 424(b)(3) under the Securities Act or other
      applicable provision of the Securities Act to appropriately amend the list
      of Selling Stockholders thereunder.

            (c) Certificates evidencing the Shares and the Warrant Shares shall
      not contain any legend (including the legend set forth in Section 4.1(b)
      hereof): (i) while a registration statement (including the Registration
      Statement) covering the resale of such security is effective under the
      Securities Act, or (ii) following any sale of such Shares and Warrant
      Shares pursuant to Rule 144, or (iii) if such Shares or Warrant Shares are
      eligible for sale under Rule 144(k), or (iv) if such legend is not
      required under applicable requirements of the Securities Act (including
      judicial interpretations and pronouncements issued by the staff of the
      Commission); provided, however, in connection with the issuance of the
      Warrant Shares, each Purchaser, severally and not jointly with the other
      Purchasers, hereby agrees to adhere to and abide by all prospectus
      delivery requirements under the Securities Act and rules and regulations
      of the Commission. The Company shall cause its counsel to issue a legal
      opinion to the Company's transfer agent promptly after the Effective Date
      if required by the Company's transfer agent to effect the removal of the
      legend hereunder. If all or any portion of a Warrant is exercised at a
      time when there is an effective registration statement to cover the resale
      of the Warrant Shares, such Warrant Shares, or if such Warrant Shares may
      be sold under Rule 144(k) or if such legend is not otherwise required
      under applicable requirements of the Securities Act (including judicial
      interpretations thereof) shall be issued free of all legends. The Company
      agrees that following the Effective Date or at such time as such legend is
      no longer required under this Section 4.1(c), it will, no later than three
      Trading Days following the delivery by a Purchaser to the Company or the
      Company's transfer agent of a certificate representing Shares or Warrant
      Shares, as the case may be, issued with a restrictive legend (such third
      Trading Day, the "Legend Removal Date"), deliver or cause to be delivered
      to such Purchaser a certificate representing such Securities that is free

                                      -19-
<PAGE>

      from all restrictive and other legends. The Company may not make any
      notation on its records or give instructions to any transfer agent of the
      Company that enlarge the restrictions on transfer set forth in this
      Section.

            (d) In addition to such Purchaser's other available remedies, the
      Company shall pay to a Purchaser, in cash, as partial liquidated damages
      and not as a penalty, for each $1,000 of Shares or Warrant Shares (based
      on the VWAP of the Common Stock on the date such Securities are submitted
      to the Company's transfer agent) delivered for removal of the restrictive
      legend and subject to this Section 4.1(c), $10 per Trading Day (increasing
      to $20 per Trading Day 5 Trading Days after such damages have begun to
      accrue) for each Trading Day after the Legend Removal Date until such
      certificate is delivered without a legend. Nothing herein shall limit such
      Purchaser's right to pursue actual damages for the Company's failure to
      deliver certificates representing any Securities as required by the
      Transaction Documents, and such Purchaser shall have the right to pursue
      all remedies available to it at law or in equity including, without
      limitation, a decree of specific performance and/or injunctive relief.

            (e) Each Purchaser, severally and not jointly with the other
      Purchasers, agrees that the removal of the restrictive legend from
      certificates representing Securities as set forth in this Section 4.1 is
      predicated upon the Company's reliance that the Purchaser will sell any
      Securities pursuant to either the registration requirements of the
      Securities Act, including any applicable prospectus delivery requirements,
      or an exemption therefrom.

            (f) Until the date that is 6 months after the date hereof, the
      Company shall not undertake a reverse or forward stock split or
      reclassification of the Common Stock without the prior written consent of
      the Purchasers holding a majority of the Shares.

      4.2   Acknowledgment of Dilution. The Company acknowledges that the
issuance of the Securities may result in dilution of the outstanding shares of
Common Stock, which dilution may be substantial under certain market conditions.
The Company further acknowledges that its obligations under the Transaction
Documents, including without limitation its obligation to issue the Securities
pursuant to the Transaction Documents, are, except as provided in Section 2.3,
unconditional and absolute and not subject to any right of set off,
counterclaim, delay or reduction, regardless of the effect of any such dilution
or any claim the Company may have against any Purchaser and regardless of the
dilutive effect that such issuance may have on the ownership of the other
stockholders of the Company.

      4.3   Furnishing of Information. As long as any Purchaser owns Securities,
the Company covenants to timely file (or obtain extensions in respect thereof
and file within the applicable grace period) all reports required to be filed by
the Company after the date hereof pursuant to the Exchange Act. As long as any
Purchaser owns Securities, if the Company is not required to file reports
pursuant to the Exchange Act, it will prepare and furnish to the Purchasers and
make publicly available in accordance with Rule 144(c) such information as is
required under Rule 144(c) in order for the Purchasers to be able to sell the
Securities under Rule 144. The Company further covenants that it will take such
further action as any holder of

                                      -20-
<PAGE>

Securities may reasonably request, all to the extent required from time to time
to enable such Person to sell such Securities without registration under the
Securities Act in accordance with Rule 144(k).

      4.4   Integration. The Company shall not sell, offer for sale or solicit
offers to buy or otherwise negotiate in respect of any security (as defined in
Section 2 of the Securities Act) that would be integrated with the offer or sale
of the Securities in a manner that would require the registration under the
Securities Act of the sale of the Securities to the Purchasers or that would be
integrated with the offer or sale of the Securities for purposes of the rules
and regulations of any Trading Market.

      4.5   Exercise Procedures. The form of Notice of Exercise included in the
Warrants sets forth the totality of the procedures required of the Purchasers in
order to exercise the Warrants. No additional legal opinion or other information
or instructions shall be required of the Purchasers to exercise their Warrants.
The Company shall honor exercises of the Warrants and shall deliver Warrant
Shares in accordance with the terms, conditions and time periods set forth in
the Transaction Documents.

      4.6   Securities Laws Disclosure; Publicity. The Company shall, by 8:30
a.m. Eastern time on the Trading Day following the date hereof, issue a press
release or file a Current Report on Form 8-K, in each case reasonably acceptable
to each Purchaser disclosing the material terms of the transactions contemplated
hereby. The Company and each Purchaser shall consult with each other in issuing
any other press releases with respect to the transactions contemplated hereby,
and neither the Company nor any Purchaser shall issue any such press release or
otherwise make any such public statement without the prior consent of the
Company, with respect to any press release of any Purchaser, or without the
prior consent of each Purchaser, with respect to any press release of the
Company, which consent shall not unreasonably be withheld, except if such
disclosure is required by law, in which case the disclosing party shall promptly
provide the other party with prior notice of such public statement or
communication. Notwithstanding the foregoing, the Company shall not publicly
disclose the name of any Purchaser, or include the name of any Purchaser in any
filing with the Commission or any regulatory agency or Trading Market, without
the prior written consent of such Purchaser, except (i) as required by federal
securities law in connection with such Current Report on Form 8-K or the
registration statement contemplated by the Registration Rights Agreement and
except (ii) to the extent such disclosure is required by law or Trading Market
regulations, in which case the Company shall provide the Purchasers with prior
notice of such disclosure permitted under subclause (i) or (ii).

      4.7   Shareholders Rights Plan; Investment Company Act. No claim will be
made or enforced by the Company or, to the knowledge of the Company, any other
Person that any Purchaser is an "Acquiring Person" under any shareholders rights
plan or similar plan or arrangement in effect or hereafter adopted by the
Company, or that any Purchaser could be deemed to trigger the provisions of any
such plan or arrangement, by virtue of receiving Securities under the
Transaction Documents or under any other agreement between the Company and the
Purchasers. The Company shall conduct its business in a manner so that it will
not become subject to the Investment Company Act.

                                      -21-
<PAGE>

      4.8   Non-Public Information. The Company covenants and agrees that
neither it nor any other Person acting on its behalf will provide any Purchaser
or its agents or counsel with any information that the Company believes
constitutes material non-public information, unless prior thereto such Purchaser
shall have executed a written agreement regarding the confidentiality and use of
such information. The Company understands and confirms that each Purchaser shall
be relying on the foregoing representations in effecting transactions in
securities of the Company.

      4.9   Use of Proceeds. Except as set forth on Schedule 4.9 attached hereto
and fees and expenses in connection with the consummation of this transaction
and purchase of the assets of Biorex Research and Development Company, RT, the
Company shall use the net proceeds from the sale of the Securities hereunder to
fund the Company's payment of the purchase price of the assets of Biorex
Research and Development Company, RT and for working capital and general
corporate purposes in connection with the Company's ownership and operation of
such assets and not for the satisfaction of any portion of the Company's debt
outstanding on or prior to the Closing Date (other than payment of trade
payables in the ordinary course of the Company's business and prior practices),
to redeem any Company equity or equity-equivalent securities or to settle any
currently outstanding litigation.

      4.10  Reimbursement. If any Purchaser becomes involved in any capacity in
any Action by or against any Person who is a stockholder of the Company (except
as a result of sales, pledges, margin sales and similar transactions by such
Purchaser to or with any current stockholder), solely as a result of such
Purchaser's acquisition of the Securities under this Agreement, the Company will
(to the extent it may lawfully do so) reimburse such Purchaser for its
reasonable legal and other expenses (including the cost of any investigation
preparation and travel in connection therewith) incurred in connection
therewith, as such expenses are incurred. The reimbursement obligations of the
Company under this paragraph shall be in addition to any liability which the
Company may otherwise have, shall extend upon the same terms and conditions to
any Affiliates of the Purchasers who are actually named in such action,
proceeding or investigation, and partners, directors, agents, employees and
controlling persons (if any), as the case may be, of the Purchasers and any such
Affiliate, and shall be binding upon and inure to the benefit of any successors,
assigns, heirs and personal representatives of the Company, the Purchasers and
any such Affiliate and any such Person. The Company also agrees that neither the
Purchasers nor any such Affiliates, partners, directors, agents, employees or
controlling persons shall have any liability to the Company or any Person
asserting claims on behalf of or in right of the Company solely as a result of
acquiring the Securities under this Agreement (unless such action is based upon
a breach of such Purchaser's representation, warranties or covenants under the
Transaction Documents or any agreements or understandings such Purchaser may
have with any such stockholder or any violations by the Purchaser of state or
federal securities laws or any conduct by such Purchaser which constitutes
fraud, gross negligence, willful misconduct or malfeasance).

      4.11  Indemnification of Purchasers. Subject to the provisions of this
Section 4.11, the Company will indemnify and hold the Purchasers and their
directors, officers, shareholders, partners, employees and agents (each, a
"Purchaser Party") harmless from any and all losses, liabilities, obligations,
claims, contingencies, damages, costs and expenses, including all judgments,
amounts paid in settlements, court costs and reasonable attorneys' fees and
costs of

                                      -22-
<PAGE>

investigation that any such Purchaser Party may suffer or incur as a result of
or relating to (a) any breach of any of the representations, warranties,
covenants or agreements made by the Company in this Agreement or in the other
Transaction Documents or (b) any action instituted against a Purchaser, or any
of them or their respective Affiliates, by any stockholder of the Company who is
not an Affiliate of such Purchaser, with respect to any of the transactions
contemplated by the Transaction Documents (unless such action is based upon a
breach of such Purchaser's representation, warranties or covenants under the
Transaction Documents or any agreements or understandings such Purchaser may
have with any such stockholder or any violations by the Purchaser of state or
federal securities laws or any conduct by such Purchaser which constitutes
fraud, gross negligence, willful misconduct or malfeasance). If any action shall
be brought against any Purchaser Party in respect of which indemnity may be
sought pursuant to this Agreement, such Purchaser Party shall promptly notify
the Company in writing, and the Company shall have the right to assume the
defense thereof with counsel of its own choosing. Any Purchaser Party shall have
the right to employ separate counsel in any such action and participate in the
defense thereof, but the fees and expenses of such counsel shall be at the
expense of such Purchaser Party except to the extent that (i) the employment
thereof has been specifically authorized by the Company in writing, (ii) the
Company has failed after a reasonable period of time to assume such defense and
to employ counsel or (iii) in such action such Purchaser Party has been advised
in writing that there is, in the reasonable opinion of such separate counsel, a
material conflict on any material issue between the position of the Company and
the position of such Purchaser Party. The Company will not be liable to any
Purchaser Party under this Agreement (i) for any settlement by an Purchaser
Party effected without the Company's prior written consent, which shall not be
unreasonably withheld or delayed; or (ii) to the extent, but only to the extent
that a loss, claim, damage or liability is attributable to any Purchaser Party's
breach of any of the representations, warranties, covenants or agreements made
by the Purchasers in this Agreement or in the other Transaction Documents or any
agreement or understandings such Purchaser may have with any such stockholder or
any violations by the Purchaser of state or federal securities laws or any
conduct by such Purchaser which constitutes fraud, gross negligence, willful
misconduct or malfeasance.

      4.12  Reservation and Listing of Securities.

            (a) The Company shall maintain a reserve from its duly authorized
      shares of Common Stock for issuance pursuant to the Transaction Documents
      in such amount as may be required to fulfill its obligations in full under
      the Transaction Documents.

            (b) The Company hereby agrees to use best efforts to maintain the
      listing of the Common Stock on a Trading Market, and as soon as reasonably
      practicable following the Closing (but not later than the earlier of the
      Effective Date and the first anniversary of the Closing Date) to list all
      of the Shares and Warrant Shares on such Trading Market. The Company
      further agrees, if the Company applies to have the Common Stock traded on
      any other Trading Market, it will include in such application all of the
      Shares and Warrant Shares, and will take such other action as is necessary
      to cause all of the Shares and Warrant Shares to be listed on such other
      Trading Market as promptly as possible. The Company will take all action
      reasonably necessary to continue the listing and trading of its Common
      Stock on a Trading Market and will comply in all respects with the

                                      -23-
<PAGE>

      Company's reporting, filing and other obligations under the bylaws or
      rules of the Trading Market

      4.13  Subsequent Equity Sales. From the date hereof until 15 days after
the Effective Date, neither the Company nor any Subsidiary shall issue shares of
Common Stock or Common Stock Equivalents; provided, however, the 15-day period
set forth in this Section 4.13 shall be extended for the number of Trading Days
during such period in which (y) trading in the Common Stock is suspended by any
Trading Market, or (z) following the Effective Date, the Registration Statement
is not effective or the prospectus included in the Registration Statement may
not be used by the Purchasers for the resale of the Shares and Warrant Shares.
In addition to the limitations set forth herein, from the date hereof until such
time as no Purchaser holds any of the Securities, the Company shall be
prohibited from effecting or enter into an agreement to effect any Subsequent
Financing involving a "Variable Rate Transaction" or an "MFN Transaction" (each
as defined below). The term "Variable Rate Transaction" shall mean a transaction
in which the Company issues or sells (i) any debt or equity securities that are
convertible into, exchangeable or exercisable for, or include the right to
receive shares of Common Stock either (A) at a conversion, exercise or exchange
rate or other price that is based upon and/or varies with the trading prices of
or quotations for the shares of Common Stock at any time after the initial
issuance of such debt or equity securities, or (B) with a conversion, exercise
or exchange price that is subject to being reset at some future date after the
initial issuance of such debt or equity security or upon the occurrence of
specified or contingent events, other than the customary antidilution events,
directly or indirectly related to the business of the Company or the market for
the Common Stock. The term "MFN Transaction" shall mean a transaction in which
the Company issues or sells any securities in a capital raising transaction or
series of related transactions which grants to an investor the right to receive
additional shares based upon future transactions of the Company on terms more
favorable than those granted to such investor in such offering. Notwithstanding
the foregoing, this Section 4.13 shall not apply in respect of an Exempt
Issuance and the issuances set forth on Schedule 4.13 attached hereto.

      4.14  Equal Treatment of Purchasers. No consideration shall be offered or
paid to any person to amend or consent to a waiver or modification of any
provision of any of the Transaction Documents unless the same consideration is
also offered to all of the parties to the Transaction Documents. For
clarification purposes, this provision constitutes a separate right granted to
each Purchaser by the Company and negotiated separately by each Purchaser, and
is intended to treat the Purchasers as a class and shall not in any way be
construed as the Purchasers acting in concert or as a group with respect to the
purchase, disposition or voting of Securities or otherwise.

      4.15  Purchaser Acknowledgement Regarding Short Sales. Each Purchaser
understands and acknowledges, severally and not jointly with any other
Purchaser, that the SEC currently takes the position that coverage of short
sales of shares of the Common Stock "against the box" prior to the Effective
Date of the Registration Statement with the Warrant Shares issuable pursuant to
the Warrants is a violation of Section 5 of the Securities Act, as set forth in
Item 65, Section 5 under Section A, of the Manual of Publicly Available
Telephone Interpretations, dated July 1997, compiled by the Office of Chief
Counsel, Division of Corporation Finance.

                                      -24-
<PAGE>

Accordingly, each Purchaser hereby agrees not to use any of the Warrant Shares
to cover any short sales made prior to the Effective Date.

                                   ARTICLE V.
                                  MISCELLANEOUS

      5.1   Fees and Expenses. Except as expressly set forth in the Transaction
Documents to the contrary, each party shall pay the fees and expenses of its
advisers, counsel, accountants and other experts, if any, and all other expenses
incurred by such party incident to the negotiation, preparation, execution,
delivery and performance of this Agreement. The Company shall pay all transfer
agent fees, stamp taxes and other taxes and duties levied in connection with the
issuance of any Securities.

      5.2   Entire Agreement. The Transaction Documents, together with the
exhibits and schedules thereto, contain the entire understanding of the parties
with respect to the subject matter hereof and supersede all prior agreements and
understandings, oral or written, with respect to such matters, which the parties
acknowledge have been merged into such documents, exhibits and schedules.

      5.3   Notices. Any and all notices or other communications or deliveries
required or permitted to be provided hereunder shall be in writing and shall be
deemed given and effective on the earliest of (a) the date of transmission, if
such notice or communication is delivered via facsimile at the facsimile number
set forth on the signature pages attached hereto prior to 5:30 p.m. (New York
City time) on a Trading Day, (b) the next Trading Day after the date of
transmission, if such notice or communication is delivered via facsimile at the
facsimile number set forth on the signature pages attached hereto on a day that
is not a Trading Day or later than 5:30 p.m. (New York City time) on any Trading
Day, (c) the second Trading Day following the date of mailing, if sent by U.S.
nationally recognized overnight courier service, or (d) upon actual receipt by
the party to whom such notice is required to be given. The address for such
notices and communications shall be as set forth on the signature pages attached
hereto.

      5.4   Amendments; Waivers. No provision of this Agreement may be waived or
amended except in a written instrument signed, in the case of an amendment, by
the Company and each Purchaser or, in the case of a waiver, by the party against
whom enforcement of any such waiver is sought. No waiver of any default with
respect to any provision, condition or requirement of this Agreement shall be
deemed to be a continuing waiver in the future or a waiver of any subsequent
default or a waiver of any other provision, condition or requirement hereof, nor
shall any delay or omission of either party to exercise any right hereunder in
any manner impair the exercise of any such right.

      5.5   Construction. The headings herein are for convenience only, do not
constitute a part of this Agreement and shall not be deemed to limit or affect
any of the provisions hereof. The language used in this Agreement will be deemed
to be the language chosen by the parties to express their mutual intent, and no
rules of strict construction will be applied against any party.

                                      -25-
<PAGE>

      5.6   Successors and Assigns. This Agreement shall be binding upon and
inure to the benefit of the parties and their successors and permitted assigns.
The Company may not assign this Agreement or any rights or obligations hereunder
without the prior written consent of each Purchaser. Any Purchaser may assign
any or all of its rights under this Agreement to any Person to whom such
Purchaser assigns or transfers any Securities, provided such transferee agrees
in writing to be bound, with respect to the transferred Securities, by the
provisions hereof that apply to the "Purchasers".

      5.7   No Third-Party Beneficiaries. This Agreement is intended for the
benefit of the parties hereto and their respective successors and permitted
assigns and is not for the benefit of, nor may any provision hereof be enforced
by, any other Person, except as otherwise set forth in Section 4.11.

      5.8   Governing Law. All questions concerning the construction, validity,
enforcement and interpretation of the Transaction Documents shall be governed by
and construed and enforced in accordance with the internal laws of the State of
New York, without regard to the principles of conflicts of law thereof. Each
party agrees that all legal proceedings concerning the interpretations,
enforcement and defense of the transactions contemplated by this Agreement and
any other Transaction Documents (whether brought against a party hereto or its
respective affiliates, directors, officers, shareholders, employees or agents)
shall be commenced exclusively in the state and federal courts sitting in the
City of New York. Each party hereby irrevocably submits to the exclusive
jurisdiction of the state and federal courts sitting in the City of New York,
borough of Manhattan for the adjudication of any dispute hereunder or in
connection herewith or with any transaction contemplated hereby or discussed
herein (including with respect to the enforcement of any of the Transaction
Documents), and hereby irrevocably waives, and agrees not to assert in any suit,
action or proceeding, any claim that it is not personally subject to the
jurisdiction of any such court, that such suit, action or proceeding is improper
or inconvenient venue for such proceeding. Each party hereby irrevocably waives
personal service of process and consents to process being served in any such
suit, action or proceeding by mailing a copy thereof via registered or certified
mail or overnight delivery (with evidence of delivery) to such party at the
address in effect for notices to it under this Agreement and agrees that such
service shall constitute good and sufficient service of process and notice
thereof. Nothing contained herein shall be deemed to limit in any way any right
to serve process in any manner permitted by law. The parties hereby waive all
rights to a trial by jury. If either party shall commence an action or
proceeding to enforce any provisions of the Transaction Documents, then the
prevailing party in such action or proceeding shall be reimbursed by the other
party for its reasonable attorneys' fees and other costs and expenses incurred
with the investigation, preparation and prosecution of such action or
proceeding.

      5.9   Survival. The representations and warranties contained herein shall
survive the Closing and the delivery and/or exercise of the Securities, as
applicable for the applicable statute of limitations.

      5.10  Execution. This Agreement may be executed in two or more
counterparts, all of which when taken together shall be considered one and the
same agreement and shall become effective when counterparts have been signed by
each party and delivered to the other party, it

                                      -26-
<PAGE>

being understood that both parties need not sign the same counterpart. In the
event that any signature is delivered by facsimile transmission, such signature
shall create a valid and binding obligation of the party executing (or on whose
behalf such signature is executed) with the same force and effect as if such
facsimile signature page were an original thereof.

      5.11  Severability. If any provision of this Agreement is held to be
invalid or unenforceable in any respect, the validity and enforceability of the
remaining terms and provisions of this Agreement shall not in any way be
affected or impaired thereby and the parties will attempt to agree upon a valid
and enforceable provision that is a reasonable substitute therefor, and upon so
agreeing, shall incorporate such substitute provision in this Agreement. 5.12
Rescission and Withdrawal Right. Notwithstanding anything to the contrary
contained in (and without limiting any similar provisions of) the Transaction
Documents, whenever any Purchaser exercises a right, election, demand or option
under a Transaction Document and the Company does not timely perform its related
obligations within the periods therein provided, then such Purchaser, in its
sole discretion, may rescind or withdraw upon written notice to the Company at
any time prior to the Company's performance of such obligations, any relevant
notice, demand or election in whole or in part without prejudice to its future
actions and rights.

      5.13  Replacement of Securities. If any certificate or instrument
evidencing any Securities is mutilated, lost, stolen or destroyed, the Company
shall issue or cause to be issued in exchange and substitution for and upon
cancellation thereof, or in lieu of and substitution therefor, a new certificate
or instrument, but only upon receipt of evidence reasonably satisfactory to the
Company of such loss, theft or destruction and customary and reasonable
indemnity, if requested. The applicants for a new certificate or instrument
under such circumstances shall also pay any reasonable third-party costs
associated with the issuance of such replacement Securities.

      5.14  Remedies. In addition to being entitled to exercise all rights
provided herein or granted by law, including recovery of damages, each of the
Purchasers and the Company will be entitled to specific performance under the
Transaction Documents. The parties agree that monetary damages may not be
adequate compensation for any loss incurred by reason of any breach of
obligations described in the foregoing sentence and hereby agrees to waive in
any action for specific performance of any such obligation the defense that a
remedy at law would be adequate.

      5.15  Payment Set Aside. To the extent that the Company makes a payment or
payments to any Purchaser pursuant to any Transaction Document or a Purchaser
enforces or exercises its rights thereunder, and such payment or payments or the
proceeds of such enforcement or exercise or any part thereof are subsequently
invalidated, declared to be fraudulent or preferential, set aside, recovered
from, disgorged by or are required to be refunded, repaid or otherwise restored
to the Company, a trustee, receiver or any other person under any law
(including, without limitation, any bankruptcy law, state or federal law, common
law or equitable cause of action), then to the extent of any such restoration
the obligation or part thereof

                                      -27-
<PAGE>

originally intended to be satisfied shall be revived and continued in full force
and effect as if such payment had not been made or such enforcement or setoff
had not occurred.

      5.16  Intentionally Omitted.

      5.17  Independent Nature of Purchasers' Obligations and Rights. The
obligations of each Purchaser under any Transaction Document are several and not
joint with the obligations of any other Purchaser, and no Purchaser shall be
responsible in any way for the performance of the obligations of any other
Purchaser under any Transaction Document. Nothing contained herein or in any
Transaction Document, and no action taken by any Purchaser pursuant thereto,
shall be deemed to constitute the Purchasers as a partnership, an association, a
joint venture or any other kind of entity, or create a presumption that the
Purchasers are in any way acting in concert or as a group with respect to such
obligations or the transactions contemplated by the Transaction Document. Each
Purchaser shall be entitled to independently protect and enforce its rights,
including without limitation the rights arising out of this Agreement or out of
the other Transaction Documents, and it shall not be necessary for any other
Purchaser to be joined as an additional party in any proceeding for such
purpose. Each Purchaser has been represented by its own separate legal counsel
in their review and negotiation of the Transaction Documents. For reasons of
administrative convenience only, Purchasers and their respective counsel have
chosen to communicate with the Company through FW. FW does not represent all of
the Purchasers but only Rodman & Renshaw, Inc., the placement agent in the
transaction. The Company has elected to provide all Purchasers with the same
terms and Transaction Documents for the convenience of the Company and not
because it was required or requested to do so by the Purchasers.

      5.18  Liquidated Damages. The Company's obligations to pay any partial
liquidated damages or other amounts owing under the Transaction Documents is a
continuing obligation of the Company and shall not terminate until all unpaid
partial liquidated damages and other amounts have been paid notwithstanding the
fact that the instrument or security pursuant to which such partial liquidated
damages or other amounts are due and payable shall have been canceled.

                            (Signature Pages Follow)

                                      -28-
<PAGE>

      IN WITNESS WHEREOF, the parties hereto have caused this Securities
Purchase Agreement to be duly executed by their respective authorized
signatories as of the date first indicated above.

<TABLE>
<S>                                                      <C>
CYTRX CORPORATION                                        Address for Notice:

By: /s/ STEVEN A. KRIEGSMAN                              11726 San Vicente Boulevard
    -----------------------                              Suite 650
    Name: Steven A. Kriegsman                            Los Angeles, California 90049
    Title: Chief Executive Officer

With a copy to (which shall not constitute notice):      Benjamin Levin, Esq.
                                                         General Counsel
                                                         CytRx Corporation
                                                         11726 San Vicente Boulevard
                                                         Suite 650
                                                         Los Angeles, California 90049

                                                         Sanford J. Hillsberg, Esq.
                                                         Troy & Gould Professional Corporation
                                                         1801 Century Park East, 16th Floor
                                                         Los Angeles, California 90067
</TABLE>

                   [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
                      SIGNATURE PAGE FOR PURCHASER FOLLOWS]

                                      -29-
<PAGE>

        [PURCHASER SIGNATURE PAGES TO CYTR SECURITIES PURCHASE AGREEMENT]

      IN WITNESS WHEREOF, the undersigned have caused this Securities Purchase
Agreement to be duly executed by their respective authorized signatories as of
the date first indicated above.

Name of Investing Entity: ______________________________________________________
Signature of Authorized Signatory of Investing Entity: _________________________
Name of Authorized Signatory: __________________________________________________
Title of Authorized Signatory: _________________________________________________
Email Address of Authorized Entity:_____________________________________________

Address for Notice of Investing Entity:

Address for Delivery of Securities for Investing Entity (if not same as above):

Subscription Amount:
Shares:
Warrant Shares:
EIN Number: [PROVIDE THIS UNDER SEPARATE COVER]

                           [SIGNATURE PAGES CONTINUE]

                                      -30-<PAGE>

                                                                    EXHIBIT 10.3

                          REGISTRATION RIGHTS AGREEMENT

            This Registration Rights Agreement (this "Agreement") is made and
entered into as of October 4, 2004, among CytRx Corporation, a Delaware
corporation (the "Company"), and the purchasers signatory hereto (each such
purchaser is a "Purchaser" and all such purchasers are, collectively, the
"Purchasers").

            This Agreement is made pursuant to the Securities Purchase
Agreement, dated as of the date hereof among the Company and the Purchasers (the
"Purchase Agreement").

            The Company and the Purchasers hereby agree as follows:

      1. Definitions

            CAPITALIZED TERMS USED AND NOT OTHERWISE DEFINED HEREIN THAT ARE
DEFINED IN THE PURCHASE AGREEMENT SHALL HAVE THE MEANINGS GIVEN SUCH TERMS IN
THE PURCHASE AGREEMENT. As used in this Agreement, the following terms shall
have the following meanings:

                  "Advice" shall have the meaning set forth in Section 6(d).

                  "Effectiveness Date" means, with respect to the Registration
            Statement required to be filed hereunder, the earlier of (a) the
            120th calendar day following the date of the Purchase Agreement (the
            90th calendar day in the case of no review by the Commission), and
            (b) the fifth Trading Day following the date on which the Company is
            notified by the Commission that the Registration Statement will not
            be reviewed or is no longer subject to further review and comments.

                  "Effectiveness Period" shall have the meaning set forth in
            Section 2(a).

                  "Event" shall have the meaning set forth in Section 2(b).

                  "Event Date" shall have the meaning set forth in Section 2(b).

                  "Filing Date" means, with respect to the Registration
            Statement required to be filed hereunder, the 30th calendar day
            following the date of the Purchase Agreement.

                  "Holder" or "Holders" means the holder or holders, as the case
            may be, from time to time of Registrable Securities.

                  "Indemnified Party" shall have the meaning set forth in
            Section 5(c).

                                        1
<PAGE>

                  "Indemnifying Party" shall have the meaning set forth in
            Section 5(c).

                  "Losses" shall have the meaning set forth in Section 5(a).

                  "Proceeding" means an action, claim, suit, investigation or
            proceeding (including, without limitation, an investigation or
            partial proceeding, such as a deposition), whether commenced or
            threatened.

                  "Prospectus" means the prospectus included in the Registration
            Statement (including, without limitation, a prospectus that includes
            any information previously omitted from a prospectus filed as part
            of an effective registration statement in reliance upon Rule 430A
            promulgated under the Securities Act), as amended or supplemented by
            any prospectus supplement, with respect to the terms of the offering
            of any portion of the Registrable Securities covered by the
            Registration Statement, and all other amendments and supplements to
            the Prospectus, including post-effective amendments, and all
            material incorporated by reference or deemed to be incorporated by
            reference in such Prospectus.

                  "Registrable Securities" means all of the Shares and the
            Warrant Shares issuable at the Closing, together with any shares of
            Common Stock issued or issuable upon any stock split, dividend or
            other distribution, recapitalization or similar event with respect
            to the foregoing.

                  "Registration Statement" means the registration statements
            required to be filed hereunder, including (in each case) the
            Prospectus, amendments and supplements to the registration statement
            or Prospectus, including pre~ and post~effective amendments, all
            exhibits thereto, and all material incorporated by reference or
            deemed to be incorporated by reference in the registration
            statement.

                  "Rule 415" means Rule 415 promulgated by the Commission
            pursuant to the Securities Act, as such Rule may be amended from
            time to time, or any similar rule or regulation hereafter adopted by
            the Commission having substantially the same purpose and effect as
            such Rule.

                  "Rule 424" means Rule 424 promulgated by the Commission
            pursuant to the Securities Act, as such Rule may be amended from
            time to time, or any similar rule or regulation hereafter adopted by
            the Commission having substantially the same purpose and effect as
            such Rule.

      2. Registration

            (a) On or prior to the Filing Date, the Company shall prepare and
file with the Commission the Registration Statement covering the resale of all
of the Registrable Securities for an offering to be made on a continuous basis
pursuant to Rule 415. The Registration Statement required hereunder shall be on
Form S-3 (except if the Company

                                        2
<PAGE>

is not then eligible to register for resale the Registrable Securities on Form
S-3, in which case the Registration shall be on another appropriate form in
accordance herewith). The Registration Statement required hereunder shall
contain (except if otherwise directed by the Holders) substantially the "Plan of
Distribution" attached hereto as Annex A. Subject to the terms of this
Agreement, the Company shall use its commercially reasonable efforts to cause
the Registration Statement to be declared effective under the Securities Act as
promptly as possible after the filing thereof, but in any event not later than
the Effectiveness Date, and shall use its best efforts to keep the Registration
Statement continuously effective under the Securities Act until the date when
all Registrable Securities covered by the Registration Statement have been sold
or may be sold without volume restrictions pursuant to Rule 144(k) as determined
by the counsel to the Company pursuant to a written opinion letter to such
effect, addressed and acceptable to the Company's transfer agent and the
affected Holders (the "Effectiveness Period"). The Company shall promptly notify
the Holders via facsimile of the effectiveness of the Registration Statement on
the same day that the Company receives notification of the effectiveness from
the Commission. Failure to so notify the Holder within 2 Trading Days of such
notification shall be deemed an Event under Section 2(b).

            (b) If: (i) the Registration Statement is not filed on or prior to
the Filing Date (if the Company files the Registration Statement without
affording the Holders the opportunity to review and comment on the same as
required by Section 3(a), the Company shall not be deemed to have satisfied this
clause (i)), or (ii) the Company fails to file with the Commission a request for
acceleration in accordance with Rule 461 promulgated under the Securities Act,
within five Trading Days of the date that the Company is notified (orally or in
writing, whichever is earlier) by the Commission that the Registration Statement
will not be "reviewed," or is not subject to further review, or (iii) prior to
the date when the Registration Statement is first declared effective by the
Commission, the Company fails to file a pre-effective amendment and otherwise
respond in writing to comments made by the Commission in respect of the
Registration Statement within 15 calendar days after the receipt of comments by
or notice from the Commission that such amendment is required in order for the
Registration Statement to be declared effective, or (iv) the Registration
Statement filed or required to be filed hereunder is not declared effective by
the Commission on or before the Effectiveness Date, or (v) after the
Registration Statement is first declared effective by the Commission, it ceases
for any reason to remain continuously effective as to all Registrable Securities
for which it is required to be effective, or the Holders are not permitted to
utilize the Prospectus therein to resell such Registrable Securities for 15
consecutive calendar days but no more than an aggregate of 30 calendar days
during any 12-month period (which need not be consecutive Trading Days) (any
such failure or breach being referred to as an "Event", and for purposes of
clause (i) or (iv) the date on which such Event occurs, or for purposes of
clause (ii) the date on which such five Trading Day period is exceeded, or for
purposes of clause (iii) the date which such 10 calendar day period is exceeded,
or for purposes of clause (v) the date on which such 15 or 30 calendar day
period, as applicable, is exceeded being referred to as "Event Date"), then in
addition to any other rights the Holders may have hereunder or under applicable
law, on each such Event Date and on each monthly anniversary of each such Event
Date (if the applicable Event shall not have been cured by

                                        3
<PAGE>

such date) until the applicable Event is cured, the Company shall pay to each
Holder an amount in cash, as partial liquidated damages and not as a penalty,
equal to 2% of the aggregate purchase price paid by such Holder pursuant to the
Purchase Agreement for any Registrable Securities then held by such Holder;
provided, however, that the liquidated damages payable by any Holder shall not
exceed 22% of the aggregate purchase price paid by such Holder pursuant to the
Purchase Agreement for the Registrable Securities then held by such Purchaser.
If the Company fails to pay any partial liquidated damages pursuant to this
Section in full within seven days after the date payable, the Company will pay
interest thereon at a rate of 15% per annum (or such lesser maximum amount that
is permitted to be paid by applicable law) to the Holder, accruing daily from
the date such partial liquidated damages are due until such amounts, plus all
such interest thereon, are paid in full. The partial liquidated damages pursuant
to the terms hereof shall apply on a daily pro-rata basis for any portion of a
month prior to the cure of an Event.

      3. Registration Procedures

                  In connection with the Company's registration obligations
hereunder, the Company shall:

            (a) Not less than five Trading Days prior to the filing of the
Registration Statement or any related Prospectus or any amendment or supplement
thereto (including any document that would be incorporated or deemed to be
incorporated therein by reference), the Company shall, (i) furnish to each
Holder copies of all such documents proposed to be filed, which documents (other
than those incorporated or deemed to be incorporated by reference) will be
subject to the review of such Holders, and (ii) cause its officers and
directors, counsel and independent certified public accountants to respond to
such inquiries as shall be necessary, in the reasonable opinion of respective
counsel to conduct a reasonable investigation within the meaning of the
Securities Act. The Company shall not file the Registration Statement or any
such Prospectus or any amendments or supplements thereto to which the Holders of
a majority of the Registrable Securities shall reasonably object in good faith,
provided that, the Company is notified of such objection in writing no later
than 5 Trading Days after the Holders have been so furnished copies of such
documents. Each Holder agrees to furnish to the Company a completed
Questionnaire in the form attached to this Agreement as Annex B (a "Selling
Holder Questionnaire") not less than two Trading Days prior to the Filing Date
or by the end of the fourth Trading Day following the date on which such Holder
receives draft materials in accordance with this Section.

            (b) (i) Prepare and file with the Commission such amendments,
including post-effective amendments, to the Registration Statement and the
Prospectus used in connection therewith as may be necessary to keep the
Registration Statement continuously effective as to the applicable Registrable
Securities for the Effectiveness Period and prepare and file with the Commission
such additional Registration Statements in order to register for resale under
the Securities Act all of the Registrable Securities; (ii) cause the related
Prospectus to be amended or supplemented by any required Prospectus

                                        4
<PAGE>

supplement (subject to the terms of this Agreement), and as so supplemented or
amended to be filed pursuant to Rule 424; (iii) respond as promptly as
reasonably possible to any comments received from the Commission with respect to
the Registration Statement or any amendment thereto and as promptly as
reasonably possible provide the Holders true and complete copies of all
correspondence from and to the Commission relating to the Registration
Statement; and (iv) comply in all material respects with the provisions of the
Securities Act and the Exchange Act with respect to the disposition of all
Registrable Securities covered by the Registration Statement during the
applicable period in accordance (subject to the terms of this Agreement) with
the intended methods of disposition by the Holders thereof set forth in the
Registration Statement as so amended or in such Prospectus as so supplemented.

            (c) Intentionally Omitted.

            (d) Notify the Holders of Registrable Securities to be sold (which
notice shall, pursuant to clauses (ii) through (vi) hereof, be accompanied by an
instruction to suspend the use of the Prospectus until the requisite changes
have been made) as promptly as reasonably possible (and, in the case of (i)(A)
below, not less than five Trading Days prior to such filing) and (if requested
by any such Person) confirm such notice in writing no later than one Trading Day
following the day (i)(A) when a Prospectus or any Prospectus supplement or
post-effective amendment to the Registration Statement is proposed to be filed;
(B) when the Commission notifies the Company whether there will be a "review" of
the Registration Statement and whenever the Commission comments in writing on
the Registration Statement (the Company shall provide true and complete copies
thereof and all written responses thereto to each of the Holders); and (C) with
respect to the Registration Statement or any post-effective amendment, when the
same has become effective; (ii) of any request by the Commission or any other
Federal or state governmental authority for amendments or supplements to the
Registration Statement or Prospectus or for additional information; (iii) of the
issuance by the Commission or any other federal or state governmental authority
of any stop order suspending the effectiveness of the Registration Statement
covering any or all of the Registrable Securities or the initiation of any
Proceedings for that purpose; (iv) of the receipt by the Company of any
notification with respect to the suspension of the qualification or exemption
from qualification of any of the Registrable Securities for sale in any
jurisdiction, or the initiation or threatening of any Proceeding for such
purpose; (v) of the occurrence of any event or passage of time that makes the
financial statements included in the Registration Statement ineligible for
inclusion therein or any statement made in the Registration Statement or
Prospectus or any document incorporated or deemed to be incorporated therein by
reference untrue in any material respect or that requires any revisions to the
Registration Statement, Prospectus or other documents so that, in the case of
the Registration Statement or the Prospectus, as the case may be, it will not
contain any untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they were made, not misleading; and
(vi) the occurrence or existence of any pending corporate development with
respect to the Company that the Company believes may be material and that, in
the determination of the Company, makes it not in the best

                                        5
<PAGE>

interest of the Company to allow continued availability of the Registration
Statement or Prospectus; provided that any and all of such information shall
remain confidential to each Holder until such information otherwise becomes
public, unless disclosure by a Holder is required by law; provided, further,
notwithstanding each Holder's agreement to keep such information confidential,
the Holders make no acknowledgement that any such information is material,
non-public information.

            (e) Use its commercially reasonable efforts to avoid the issuance
of, or, if issued, obtain the withdrawal of (i) any order suspending the
effectiveness of the Registration Statement, or (ii) any suspension of the
qualification (or exemption from qualification) of any of the Registrable
Securities for sale in any jurisdiction, at the earliest practicable moment.

            (f) Furnish to each Holder, without charge, at least one conformed
copy of the Registration Statement and each amendment thereto, including
financial statements and schedules, all documents incorporated or deemed to be
incorporated therein by reference to the extent requested by such Person, and
all exhibits to the extent requested by such Person (including those previously
furnished or incorporated by reference) promptly after the filing of such
documents with the Commission.

            (g) Promptly deliver to each Holder, without charge, as many copies
of the Prospectus or Prospectuses (including each form of prospectus) and each
amendment or supplement thereto as such Persons may reasonably request in
connection with resales by the Holder of Registrable Securities. Subject to the
terms of this Agreement, the Company hereby consents to the use of such
Prospectus and each amendment or supplement thereto by each of the selling
Holders in connection with the offering and sale of the Registrable Securities
covered by such Prospectus and any amendment or supplement thereto, except after
the giving on any notice pursuant to Section 3(d).

            (h) Prior to any resale of Registrable Securities by a Holder, use
its commercially reasonable efforts to register or qualify or cooperate with the
selling Holders in connection with the registration or qualification (or
exemption from the Registration or qualification) of such Registrable Securities
for the resale by the Holder under the securities or Blue Sky laws of such
jurisdictions within the United States as any Holder reasonably requests in
writing, to keep the registration or qualification (or exemption therefrom)
effective during the Effectiveness Period and to do any and all other acts or
things reasonably necessary to enable the disposition in such jurisdictions of
the Registrable Securities covered by the Registration Statement; provided, that
the Company shall not be required to qualify generally to do business in any
jurisdiction where it is not then so qualified, subject the Company to any
material tax in any such jurisdiction where it is not then so subject or file a
general consent to service of process in any such jurisdiction.

            (i) If requested by the Holders, cooperate with the Holders to
facilitate the timely preparation and delivery of certificates representing
Registrable Securities to be delivered to a transferee pursuant to the
Registration Statement, which certificates shall

                                        6
<PAGE>

be free, to the extent permitted by the Purchase Agreement, of all restrictive
legends, and to enable such Registrable Securities to be in such denominations
and registered in such names as any such Holders may request.

            (j) Upon the occurrence of any event contemplated by this Section 3,
as promptly as reasonably possible under the circumstances taking into account
the Company's good faith assessment of any adverse consequences to the Company
and its stockholders of the premature disclosure of such event, prepare a
supplement or amendment, including a post-effective amendment, to the
Registration Statement or a supplement to the related Prospectus or any document
incorporated or deemed to be incorporated therein by reference, and file any
other required document so that, as thereafter delivered, neither the
Registration Statement nor such Prospectus will contain an untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading. If the Company notifies the Holders in
accordance with clauses (ii) through (vi) of Section 3(d) above to suspend the
use of the Prospectus until the requisite changes to such Prospectus have been
made, then the Holders shall suspend use of such Prospectus. The Company will
use its commercially reasonable efforts to ensure that the use of the Prospectus
may be resumed as promptly as is practicable. The Company shall be entitled to
exercise its right under this Section 3(j) to suspend the availability of the
Registration Statement and Prospectus, subject to the payment of partial
liquidated damages pursuant to Section 2(b), for a period not to exceed 90 days
(which need not be consecutive days) in any 12 month period.

            (k) Comply with all applicable rules and regulations of the
Commission.

            (l) The Company may require each selling Holder to furnish to the
Company a certified statement as to the number of shares of Common Stock
beneficially owned by such Holder and, if required by the Commission, the person
thereof that has voting and dispositive control over the Shares. During any
periods that the Company is unable to meet its obligations hereunder with
respect to the registration of the Registrable Securities solely because any
Holder fails to furnish such information within 3 Trading Days of the Company's
request, any liquidated damages that are accruing at such time as to such Holder
only shall be tolled and any Event that may otherwise occur solely because of
such delay shall be suspended as to such Holder only, until such information is
delivered to the Company.

      4. Registration Expenses. All fees and expenses incident to the
performance of or compliance with this Agreement by the Company shall be borne
by the Company whether or not any Registrable Securities are sold pursuant to
the Registration Statement. The fees and expenses referred to in the foregoing
sentence shall include, without limitation, (i) all registration and filing fees
(including, without limitation, fees and expenses (A) with respect to filings
required to be made with the Trading Market on which the Common Stock is then
listed for trading, and (B) in compliance with applicable state securities or
Blue Sky laws reasonably agreed to by the Company in writing (including, without
limitation, fees and disbursements of counsel for the

                                        7
<PAGE>

Company in connection with Blue Sky qualifications or exemptions of the
Registrable Securities and determination of the eligibility of the Registrable
Securities for investment under the laws of such jurisdictions as requested by
the Holders), (ii) printing expenses (including, without limitation, expenses of
printing certificates for Registrable Securities and of printing prospectuses if
the printing of prospectuses is reasonably requested by the holders of a
majority of the Registrable Securities included in the Registration Statement),
(iii) messenger, telephone and delivery expenses, (iv) fees and disbursements of
counsel for the Company, (v) Securities Act liability insurance, if the Company
so desires such insurance, and (vi) fees and expenses of all other Persons
retained by the Company in connection with the consummation of the transactions
contemplated by this Agreement. In addition, the Company shall be responsible
for all of its internal expenses incurred in connection with the consummation of
the transactions contemplated by this Agreement (including, without limitation,
all salaries and expenses of its officers and employees performing legal or
accounting duties), the expense of any annual audit and the fees and expenses
incurred in connection with the listing of the Registrable Securities on any
securities exchange as required hereunder. In no event shall the Company be
responsible for any broker or similar commissions or, except to the extent
provided for in the Transaction Documents, any legal fees or other costs of the
Holders.

      5. Indemnification

            (a) Indemnification by the Company. The Company shall,
notwithstanding any termination of this Agreement, indemnify and hold harmless
each Holder, the officers, directors, agents, brokers (including brokers who
offer and sell Registrable Securities as principal as a result of a pledge or
any failure to perform under a margin call of Common Stock), investment advisors
and employees of each of them, each Person who controls any such Holder (within
the meaning of Section 15 of the Securities Act or Section 20 of the Exchange
Act) and the officers, directors, agents and employees of each such controlling
Person, to the fullest extent permitted by applicable law, from and against any
and all losses, claims, damages, liabilities, costs (including, without
limitation, reasonable attorneys' fees) and expenses (collectively, "Losses"),
as incurred, arising out of or relating to any untrue or alleged untrue
statement of a material fact contained in the Registration Statement, any
Prospectus or any form of prospectus or in any amendment or supplement thereto
or in any preliminary prospectus, or arising out of or relating to any omission
or alleged omission of a material fact required to be stated therein or
necessary to make the statements therein (in the case of any Prospectus or form
of prospectus or supplement thereto, in light of the circumstances under which
they were made) not misleading, except to the extent, but only to the extent,
that (i) such untrue statements or omissions are based solely upon information
regarding such Holder furnished in writing to the Company by such Holder
expressly for use therein, or to the extent that such information relates to
such Holder or such Holder's proposed method of distribution of Registrable
Securities and was reviewed and expressly approved in writing by such Holder
expressly for use in the Registration Statement, such Prospectus or such form of
Prospectus or in any amendment or supplement thereto (it being understood that
the Holder has approved Annex A hereto for this purpose) or (ii) in the case of
an occurrence of an event of the type specified in Section 3(d)(ii)-(vi), the
use by such Holder of an

                                        8
<PAGE>

outdated or defective Prospectus after the Company has notified such Holder in
writing that the Prospectus is outdated or defective and prior to the receipt by
such Holder of the Advice contemplated in Section 6(d). The Company shall notify
the Holders promptly of the institution, threat or assertion of any Proceeding
arising from or in connection with the transactions contemplated by this
Agreement of which the Company is aware.

            (b) Indemnification by Holders. Each Holder shall, severally and not
jointly, indemnify and hold harmless the Company, its directors, officers,
agents and employees, each Person who controls the Company (within the meaning
of Section 15 of the Securities Act and Section 20 of the Exchange Act), and the
directors, officers, agents or employees of such controlling Persons, to the
fullest extent permitted by applicable law, from and against all Losses, as
incurred, to the extent arising out of or based solely upon: (x) such Holder's
failure to comply with the prospectus delivery requirements of the Securities
Act or (y) any untrue or alleged untrue statement of a material fact contained
in any Registration Statement, any Prospectus, or any form of prospectus, or in
any amendment or supplement thereto or in any preliminary prospectus, or arising
out of or relating to any omission or alleged omission of a material fact
required to be stated therein or necessary to make the statements therein not
misleading (i) to the extent, but only to the extent, that such untrue statement
or omission is contained in any information so furnished in writing by such
Holder to the Company specifically for inclusion in the Registration Statement
or such Prospectus or (ii) to the extent that (1) such untrue statements or
omissions are based solely upon information regarding such Holder furnished in
writing to the Company by such Holder expressly for use therein, or to the
extent that such information relates to such Holder or such Holder's proposed
method of distribution of Registrable Securities and was reviewed and expressly
approved in writing by such Holder expressly for use in the Registration
Statement (it being understood that the Holder has approved Annex A hereto for
this purpose), such Prospectus or such form of Prospectus or in any amendment or
supplement thereto or (2) in the case of an occurrence of an event of the type
specified in Section 3(d)(ii)-(vi), the use by such Holder of an outdated or
defective Prospectus after the Company has notified such Holder in writing that
the Prospectus is outdated or defective and prior to the receipt by such Holder
of the Advice contemplated in Section 6(d). In no event shall the liability of
any selling Holder hereunder be greater in amount than the dollar amount of the
net proceeds received by such Holder upon the sale of the Registrable Securities
giving rise to such indemnification obligation.

            (c) Conduct of Indemnification Proceedings. If any Proceeding shall
be brought or asserted against any Person entitled to indemnity hereunder (an
"Indemnified Party"), such Indemnified Party shall promptly notify the Person
from whom indemnity is sought (the "Indemnifying Party") in writing, and the
Indemnifying Party shall have the right to assume the defense thereof, including
the employment of counsel reasonably satisfactory to the Indemnified Party and
the payment of all fees and expenses incurred in connection with defense
thereof; provided, that the failure of any Indemnified Party to give such notice
shall not relieve the Indemnifying Party of its obligations or liabilities
pursuant to this Agreement, except (and only) to the extent that it shall be
finally determined by a

                                        9
<PAGE>

court of competent jurisdiction (which determination is not subject to appeal or
further review) that such failure shall have prejudiced the Indemnifying Party.

            An Indemnified Party shall have the right to employ separate counsel
in any such Proceeding and to participate in the defense thereof, but the fees
and expenses of such counsel shall be at the expense of such Indemnified Party
or Parties unless: (1) the Indemnifying Party has agreed in writing to pay such
fees and expenses; (2) the Indemnifying Party shall have failed promptly to
assume the defense of such Proceeding and to employ counsel reasonably
satisfactory to such Indemnified Party in any such Proceeding; or (3) the named
parties to any such Proceeding (including any impleaded parties) include both
such Indemnified Party and the Indemnifying Party, and such Indemnified Party
has been advised in writing by counsel that a material conflict of interest is
likely to exist if the same counsel were to represent such Indemnified Party and
the Indemnifying Party (in which case, if such Indemnified Party notifies the
Indemnifying Party in writing that it elects to employ separate counsel at the
expense of the Indemnifying Party, the Indemnifying Party shall not have the
right to assume the defense thereof and the reasonable fees and expenses of one
separate counsel shall be at the expense of the Indemnifying Party). The
Indemnifying Party shall not be liable for any settlement of any such Proceeding
effected without its written consent, which consent shall not be unreasonably
withheld. No Indemnifying Party shall, without the prior written consent of the
Indemnified Party, which shall not unreasonably be withheld, effect any
settlement of any pending Proceeding in respect of which any Indemnified Party
is a party, unless such settlement includes an unconditional release of such
Indemnified Party from all liability on claims that are the subject matter of
such Proceeding.

            Subject to the terms of this Agreement, all reasonable fees and
expenses of the Indemnified Party (including reasonable fees and expenses to the
extent incurred in connection with investigating or preparing to defend such
Proceeding in a manner not inconsistent with this Section) shall be paid to the
Indemnified Party, as incurred, within ten Trading Days of written notice
thereof to the Indemnifying Party; provided, that the Indemnified Party shall
promptly reimburse the Indemnifying Party for that portion of such fees and
expenses applicable to such actions for which such Indemnified Party is not
entitled to indemnification hereunder, determined based upon the relative faults
of the parties.

            (d) Contribution. If a claim for indemnification under Section 5(a)
or 5(b) is unavailable to an Indemnified Party (by reason of public policy or
otherwise), then each Indemnifying Party, in lieu of indemnifying such
Indemnified Party, shall contribute to the amount paid or payable by such
Indemnified Party as a result of such Losses, in such proportion as is
appropriate to reflect the relative fault of the Indemnifying Party and
Indemnified Party in connection with the actions, statements or omissions that
resulted in such Losses as well as any other relevant equitable considerations.
The relative fault of such Indemnifying Party and Indemnified Party shall be
determined by reference to, among other things, whether any action in question,
including any untrue or alleged untrue statement of a material fact or omission
or alleged omission of a material fact, has

                                       10
<PAGE>

been taken or made by, or relates to information supplied by, such Indemnifying
Party or Indemnified Party, and the parties' relative intent, knowledge, access
to information and opportunity to correct or prevent such action, statement or
omission. The amount paid or payable by a party as a result of any Losses shall
be deemed to include, subject to the limitations set forth in this Agreement,
any reasonable attorneys' or other reasonable fees or expenses incurred by such
party in connection with any Proceeding to the extent such party would have been
indemnified for such fees or expenses if the indemnification provided for in
this Section was available to such party in accordance with its terms.

            The parties hereto agree that it would not be just and equitable if
contribution pursuant to this Section 5(d) were determined by pro rata
allocation or by any other method of allocation that does not take into account
the equitable considerations referred to in the immediately preceding paragraph.
Notwithstanding the provisions of this Section 5(d), no Holder shall be required
to contribute, in the aggregate, any amount in excess of the amount by which the
proceeds actually received by such Holder from the sale of the Registrable
Securities subject to the Proceeding exceeds the amount of any damages that such
Holder has otherwise been required to pay by reason of such untrue or alleged
untrue statement or omission or alleged omission, except in the case of fraud by
such Holder.

            The indemnity and contribution agreements contained in this Section
are in addition to any liability that the Indemnifying Parties may have to the
Indemnified Parties.

      6. Miscellaneous

            (a) Remedies. In the event of a breach by the Company or by a
Holder, of any of their obligations under this Agreement, each Holder or the
Company, as the case may be, in addition to being entitled to exercise all
rights granted by law and under this Agreement, including recovery of damages,
will be entitled to specific performance of its rights under this Agreement. The
Company and each Holder agree that monetary damages would not provide adequate
compensation for any losses incurred by reason of a breach by it of any of the
provisions of Section 2 and 3 of this Agreement and hereby further agrees that,
in the event of any action for specific performance in respect of such breach,
it shall waive the defense that a remedy at law would be adequate.

            (b) No Piggyback on Registrations. Except as set forth on Schedule
6(b) attached hereto, neither the Company nor any of its security holders (other
than the Holders in such capacity pursuant hereto) may include securities of the
Company in the Registration Statement other than the Registrable Securities.
Except for registration statements (including the Registration Statement)
referred to in Schedule 6(b), the Company shall not file any other registration
statements until the initial Registration Statement required hereunder is
declared effective by the Commission, provided that this Section 6(b) shall not
prohibit the Company from filing amendments to registration statements already
filed.

                                       11
<PAGE>

            (c) Compliance. Each Holder covenants and agrees that it will comply
with the prospectus delivery requirements of the Securities Act as applicable to
it in connection with sales of Registrable Securities pursuant to the
Registration Statement.

            (d) Discontinued Disposition. Each Holder agrees by its acquisition
of such Registrable Securities that, upon receipt of a notice from the Company
of the occurrence of any event of the kind described in Section 3(d), such
Holder will forthwith discontinue disposition of such Registrable Securities
under the Registration Statement until such Holder's receipt of the copies of
the supplemented Prospectus and/or amended Registration Statement, or until it
is advised in writing (the "Advice") by the Company that the use of the
applicable Prospectus may be resumed, and, in either case, has received copies
of any additional or supplemental filings that are incorporated or deemed to be
incorporated by reference in such Prospectus or Registration Statement. The
Company will use its commercially reasonable efforts to ensure that the use of
the Prospectus may be resumed as promptly as it practicable. The Company agrees
and acknowledges that any periods during which the Holder is required to
discontinue the disposition of the Registrable Securities hereunder shall be
subject to the provisions of Section 2(b).

            (e) Piggy-Back Registrations. If at any time during the
Effectiveness Period there is not an effective Registration Statement covering
all of the Registrable Securities and the Company shall determine to prepare and
file with the Commission a registration statement relating to an offering for
its own account or the account of others under the Securities Act of any of its
equity securities, other than on Form S-4 or Form S-8 (each as promulgated under
the Securities Act) or their then equivalents relating to equity securities to
be issued solely in connection with any acquisition of any entity or business or
equity securities issuable in connection with the stock option or other employee
benefit plans, then the Company shall send to each Holder a written notice of
such determination and, if within fifteen days after the date of such notice,
any such Holder shall so request in writing, the Company shall include in such
registration statement all or any part of such Registrable Securities such
holder requests to be registered; provided, that, the Company shall not be
required to register any Registrable Securities pursuant to this Section 6(e)
that are eligible for resale pursuant to Rule 144(k) promulgated under the
Securities Act or that are the subject of a then effective Registration
Statement. This Section 6(e) shall not apply to amendments filed after the date
hereof with respect to registration statements already filed.

            (f) Amendments and Waivers. The provisions of this Agreement,
including the provisions of this sentence, may not be amended, modified or
supplemented, and waivers or consents to departures from the provisions hereof
may not be given, unless the same shall be in writing and signed by the Company
and each Holder of the then outstanding Registrable Securities. Notwithstanding
the foregoing, a waiver or consent to depart from the provisions hereof with
respect to a matter that relates exclusively to the rights of Holders and that
does not directly or indirectly affect the rights of other Holders may be given
by Holders of all of the Registrable Securities to which such waiver or consent
relates; provided, however, that the provisions of this sentence may not be

                                       12
<PAGE>

amended, modified, or supplemented except in accordance with the provisions of
the immediately preceding sentence.

            (g) Notices. Any and all notices or other communications or
deliveries required or permitted to be provided hereunder shall be delivered as
set forth in the Purchase Agreement.

            (h) Successors and Assigns. This Agreement shall inure to the
benefit of and be binding upon the successors and permitted assigns of each of
the parties and shall inure to the benefit of each Holder. The Company may not
assign its rights or obligations hereunder without the prior written consent of
all of the Holders of the then-outstanding Registrable Securities. Each Holder
may assign their respective rights hereunder in the manner and to the Persons as
permitted under the Purchase Agreement.

            (i) No Inconsistent Agreements. Neither the Company nor any of its
subsidiaries has entered, as of the date hereof, nor shall the Company or any of
its subsidiaries, on or after the date of this Agreement, enter into any
agreement with respect to its securities, that would have the effect of
impairing the rights granted to the Holders in this Agreement or otherwise
conflicts with the provisions hereof. Except as set forth on Schedule 6(b)
attached hereto, neither the Company nor any of its subsidiaries has previously
entered into any agreement granting any registration rights with respect to any
of its securities to any Person that have not been satisfied in full.

            (j) Execution and Counterparts. This Agreement may be executed in
any number of counterparts, each of which when so executed shall be deemed to be
an original and, all of which taken together shall constitute one and the same
Agreement. In the event that any signature is delivered by facsimile
transmission, such signature shall create a valid binding obligation of the
party executing (or on whose behalf such signature is executed) the same with
the same force and effect as if such facsimile signature were the original
thereof.

            (k) Governing Law. All questions concerning the construction,
validity, enforcement and interpretation of this Agreement shall be determined
with the provisions of the Purchase Agreement.

            (l) Cumulative Remedies. The remedies provided herein are cumulative
and not exclusive of any remedies provided by law.

            (m) Severability. If any term, provision, covenant or restriction of
this Agreement is held by a court of competent jurisdiction to be invalid,
illegal, void or unenforceable, the remainder of the terms, provisions,
covenants and restrictions set forth herein shall remain in full force and
effect and shall in no way be affected, impaired or invalidated, and the parties
hereto shall use their commercially reasonable efforts to find and employ an
alternative means to achieve the same or substantially the same result as that
contemplated by such term, provision, covenant or restriction. It is hereby
stipulated and declared to be the intention of the parties that they would have
executed the

                                       13
<PAGE>

remaining terms, provisions, covenants and restrictions without including any of
such that may be hereafter declared invalid, illegal, void or unenforceable.

            (n) Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.

            (o) Independent Nature of Holders' Obligations and Rights. The
obligations of each Holder hereunder are several and not joint with the
obligations of any other Holder hereunder, and no Holder shall be responsible in
any way for the performance of the obligations of any other Holder hereunder.
Nothing contained herein or in any other agreement or document delivered at any
closing, and no action taken by any Holder pursuant hereto or thereto, shall be
deemed to constitute the Holders as a partnership, an association, a joint
venture or any other kind of entity, or create a presumption that the Holders
are in any way acting in concert with respect to such obligations or the
transactions contemplated by this Agreement. Each Holder shall be entitled to
protect and enforce its rights, including without limitation the rights arising
out of this Agreement, and it shall not be necessary for any other Holder to be
joined as an additional party in any proceeding for such purpose.

                              ********************

                                       14
<PAGE>

            IN WITNESS WHEREOF, the parties have executed this Registration
Rights Agreement as of the date first written above.

                                 CYTRX CORPORATION

                                 By:/s/ STEVEN A. KRIEGSMAN
                                    -----------------------
                                    Name: Steven A. Kriegsman
                                    Title: Chief Executive Officer

                       [SIGNATURE PAGE OF HOLDERS FOLLOWS]

                                       15
<PAGE>

                     [SIGNATURE PAGE OF HOLDERS TO CYTR RRA]

Name of Investing Entity: __________________________
Signature of Authorized Signatory of Investing Entity: _________________________
Name of Authorized Signatory: _________________________
Title of Authorized Signatory: __________________________

                           [SIGNATURE PAGES CONTINUE]

                                       16
<PAGE>

                              Plan of Distribution

      Each Selling Stockholder (the "Selling Stockholders") of the common stock
("Common Stock") of CytRx Corporation, a Delaware corporation (the "Company")
and any of their pledgees, assignees and successors-in-interest may, from time
to time, sell any or all of their shares of Common Stock on the Toronto Stock
Exchange or any other stock exchange, market or trading facility on which the
shares are traded or in private transactions. These sales may be at fixed or
negotiated prices. A Selling Stockholder may use any one or more of the
following methods when selling shares:

            -     ordinary brokerage transactions and transactions in which the
                  broker-dealer solicits purchasers;

            -     block trades in which the broker-dealer will attempt to sell
                  the shares as agent but may position and resell a portion of
                  the block as principal to facilitate the transaction;

            -     purchases by a broker-dealer as principal and resale by the
                  broker-dealer for its account;

            -     an exchange distribution in accordance with the rules of the
                  applicable exchange;

            -     privately negotiated transactions;

            -     settlement of short sales entered into after the date of this
                  prospectus;

            -     broker-dealers may agree with the Selling Stockholders to sell
                  a specified number of such shares at a stipulated price per
                  share;

            -     a combination of any such methods of sale;

            -     through the writing or settlement of options or other hedging
                  transactions, whether through an options exchange or
                  otherwise; or

            -     any other method permitted pursuant to applicable law.

      The Selling Stockholders may also sell shares under Rule 144 under the
Securities Act of 1933, as amended (the "Securities Act"), if available, rather
than under this prospectus.

      Broker-dealers engaged by the Selling Stockholders may arrange for other
brokers-dealers to participate in sales. Broker-dealers may receive commissions
or discounts from the Selling Stockholders (or, if any broker-dealer acts as
agent for the purchaser of shares, from the purchaser) in amounts to be
negotiated. Each Selling Stockholder does not expect these commissions and
discounts relating to its sales of shares to exceed what is customary in the
types of transactions involved.

                                       17
<PAGE>

      In connection with the sale of our common stock or interests therein, the
Selling Stockholders may enter into hedging transactions with broker-dealers or
other financial institutions, which may in turn engage in short sales of the
common stock in the course of hedging the positions they assume. The Selling
Stockholders may also sell shares of our common stock short and deliver these
securities to close out their short positions, or loan or pledge the common
stock to broker-dealers that in turn may sell these securities. The Selling
Stockholders may also enter into option or other transactions with
broker-dealers or other financial institutions or the creation of one or more
derivative securities which require the delivery to such broker-dealer or other
financial institution of shares offered by this prospectus, which shares such
broker-dealer or other financial institution may resell pursuant to this
prospectus (as supplemented or amended to reflect such transaction).

      The Selling Stockholders and any broker-dealers or agents that are
involved in selling the shares may be deemed to be "underwriters" within the
meaning of the Securities Act in connection with such sales. In such event, any
commissions received by such broker-dealers or agents and any profit on the
resale of the shares purchased by them may be deemed to be underwriting
commissions or discounts under the Securities Act. Each Selling Stockholder has
informed the Company that it does not have any agreement or understanding,
directly or indirectly, with any person to distribute the Common Stock.

      The Company is required to pay certain fees and expenses incurred by the
Company incident to the registration of the shares. The Company has agreed to
indemnify the Selling Stockholders against certain losses, claims, damages and
liabilities, including liabilities under the Securities Act.

      Because Selling Stockholders may be deemed to be "underwriters" within the
meaning of the Securities Act, they will be subject to the prospectus delivery
requirements of the Securities Act. In addition, any securities covered by this
prospectus which qualify for sale pursuant to Rule 144 under the Securities Act
may be sold under Rule 144 rather than under this prospectus. Each Selling
Stockholder has advised us that they have not entered into any agreements,
understandings or arrangements with any underwriter or broker-dealer regarding
the sale of the resale shares. There is no underwriter or coordinating broker
acting in connection with the proposed sale of the resale shares by the Selling
Stockholders.

      We agreed to keep this prospectus effective until the earlier of (i) the
date on which the shares may be resold by the Selling Stockholders without
registration pursuant to rule 144(k) or (ii) all of the shares have been sold
pursuant to the prospectus or Rule 144 under the Securities Act or any other
rule of similar effect. The resale shares will be sold only through registered
or licensed brokers or dealers if required under applicable state securities
laws. In addition, in certain states, the resale shares may not be sold unless
they have been registered or qualified for sale in the applicable state or an
exemption from the registration or qualification requirement is available and is
complied with.

                                       18
<PAGE>

      Under applicable rules and regulations under the Exchange Act, any person
engaged in the distribution of the resale shares may not simultaneously engage
in market making activities with respect to our common stock for a period of two
business days prior to the commencement of the distribution. In addition, the
Selling Stockholders will be subject to applicable provisions of the Exchange
Act and the rules and regulations thereunder, including Regulation M, which may
limit the timing of purchases and sales of shares of our common stock by the
Selling Stockholders or any other person. We will make copies of this prospectus
available to the Selling Stockholders and have informed them of the need to
deliver a copy of this prospectus to each purchaser at or prior to the time of
the sale.

                                       19
<PAGE>

                                                                         ANNEX B

                                CYTRX CORPORATION

                 SELLING SECURITYHOLDER NOTICE AND QUESTIONNAIRE

      The undersigned beneficial owner of common stock, par value $0.001 per
share (the "Common Stock"), of CytRx Corporation, a Delaware corporation (the
"Company"), (the "Registrable Securities") understands that the Company has
filed or intends to file with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-__ (the "Registration
Statement") for the registration and resale under Rule 415 of the Securities Act
of 1933, as amended (the "Securities Act"), of the Registrable Securities, in
accordance with the terms of the Registration Rights Agreement, dated as of
October 4, 2004 (the "Registration Rights Agreement"), among the Company and the
Purchasers named therein. A copy of the Registration Rights Agreement is
available from the Company upon request at the address set forth below. All
capitalized terms not otherwise defined herein shall have the meanings ascribed
thereto in the Registration Rights Agreement.

      Certain legal consequences arise from being named as a selling
securityholder in the Registration Statement and the related prospectus.
Accordingly, holders and beneficial owners of Registrable Securities are advised
to consult their own securities law counsel regarding the consequences of being
named or not being named as a selling securityholder in the Registration
Statement and the related prospectus.

                                     NOTICE

      The undersigned beneficial owner (the "Selling Securityholder") of
Registrable Securities hereby elects to include the Registrable Securities owned
by it and listed below in Item 3 (unless otherwise specified under such Item 3)
in the Registration Statement.

                                       20
<PAGE>

The undersigned hereby provides the following information to the Company and
represents and warrants that such information is accurate:

                                  QUESTIONNAIRE

1.    NAME.

      (a)   Full Legal Name of Selling Securityholder

            ____________________________________________________________________

      (b)   Full Legal Name of Registered Holder (if not the same as (a) above)
            through which Registrable Securities Listed in Item 3 below are
            held:

            ____________________________________________________________________

      (c)   Full Legal Name of Natural Control Person (which means a natural
            person who directly you indirectly alone or with others has power to
            vote or dispose of the securities covered by the questionnaire):

            ____________________________________________________________________

2. ADDRESS FOR NOTICES TO SELLING SECURITYHOLDER:

________________________________________________________________________________

________________________________________________________________________________

________________________________________________________________________________
 Telephone:_____________________________________________________________________
 Fax:___________________________________________________________________________
 Contact Person:________________________________________________________________

3. BENEFICIAL OWNERSHIP OF REGISTRABLE SECURITIES:

      (a)   Type and Principal Amount of Registrable Securities beneficially
            owned:

            ____________________________________________________________________

            ____________________________________________________________________

            ____________________________________________________________________

                                       21
<PAGE>

4. BROKER-DEALER STATUS:

      (a)   Are you a broker-dealer?

                                 Yes [ ] No [ ]

      Note: If yes, the Commission's staff has indicated that you should be
            identified as an underwriter in the Registration Statement.

      (b)   Are you an affiliate of a broker-dealer?

                                 Yes [ ] No [ ]

      (c)   If you are an affiliate of a broker-dealer, do you certify that you
            bought the Registrable Securities in the ordinary course of
            business, and at the time of the purchase of the Registrable
            Securities to be resold, you had no agreements or understandings,
            directly or indirectly, with any person to distribute the
            Registrable Securities?

                                 Yes [ ] No [ ]

      Note: If no, the Commission's staff has indicated that you should be
            identified as an underwriter in the Registration Statement.

5. BENEFICIAL OWNERSHIP OF OTHER SECURITIES OF THE COMPANY OWNED BY THE SELLING
      SECURITYHOLDER.

      Except as set forth below in this Item 5, the undersigned is not the
      beneficial or registered owner of any securities of the Company other than
      the Registrable Securities listed above in Item 3.

      (a)   Type and Amount of Other Securities beneficially owned by the
            Selling Securityholder:

            ____________________________________________________________________

            ____________________________________________________________________

                                       22
<PAGE>

6. RELATIONSHIPS WITH THE COMPANY:

      Except as set forth below, neither the undersigned nor any of its
      affiliates, officers, directors or principal equity holders (owners of 5%
      of more of the equity securities of the undersigned) has held any position
      or office or has had any other material relationship with the Company (or
      its predecessors or affiliates) during the past three years.

      State any exceptions here:

      _________________________________________________________________________

      _________________________________________________________________________

      The undersigned agrees to promptly notify the Company of any inaccuracies
or changes in the information provided herein that may occur subsequent to the
date hereof at any time while the Registration Statement remains effective.

      By signing below, the undersigned consents to the disclosure of the
information contained herein in its answers to Items 1 through 6 and the
inclusion of such information in the Registration Statement and the related
prospectus. The undersigned understands that such information will be relied
upon by the Company in connection with the preparation or amendment of the
Registration Statement and the related prospectus.

      IN WITNESS WHEREOF the undersigned, by authority duly given, has caused
this Notice and Questionnaire to be executed and delivered either in person or
by its duly authorized agent.

Dated: __________________________      Beneficial Owner:________________________

                                       By: _____________________________________
                                           Name:
                                           Title:

PLEASE FAX A COPY OF THE COMPLETED AND EXECUTED NOTICE AND QUESTIONNAIRE, AND
RETURN THE ORIGINAL BY OVERNIGHT MAIL, TO:

                                       23

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