Document:

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EXHIBIT 10.1

THIRD AMENDED AND RESTATED EMPLOYMENT AGREEMENT

     This Third Amended and Restated Employment Agreement (this “Agreement”) is made and entered
into as of the 17th day of May, 2005, by and between CytRx Corporation, a Delaware corporation
(“Employer”), and Steven A. Kriegsman, an individual and resident of the State of California
(“Employee”), with reference to the following facts:

     A. Employer and Employee previously entered into a Second Amended and Restated Employment
Agreement, dated June 10, 2003 (the “2003 Employment Agreement”), under which Employee is serving
as President and Chief Executive Officer of Employer in accordance with the terms of that agreement
which such term of employment will expire on July 15, 2006.

     B. Under the terms of the 2003 Employment Agreement, Employee is permitted to continue to
serve as the President and Chairman of the Board of the Kriegsman Capital Group and its affiliates
(collectively, “The Kriegsman Group”) and to devote certain time and attention to the operations of
The Kriegsman Group.

     C. Employer believes that Employee has been and will continue to be an integral part of its
management and is and will continue to be responsible for developing its business.

     D. Employee possesses extensive knowledge regarding Employer’s business, including
confidential and proprietary information concerning marketing plans and strategy, business plans,
projections, and the formulae and models pertaining thereto, customer needs and peculiarities,
finances, operations, billing methods, customer lists and trade secrets.

     F. Employer and Employee desire to amend and restate the 2003 Employment Agreement under which
Employee shall serve on a full-time basis as Employer’s President and Chief Executive Officer on
the terms set forth in this Agreement, with the term of this new employment agreement to commence
on July 1, 2005 (the “Effective Date”).

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

     1. Continuation and Expiration of 2003 Employment Agreement. Employer and Employee
agree that Employee shall continue to be employed as Employer’s President and Chief Executive
Officer under the terms of the 2003 Employment Agreement through June 30, 2005 (at the rate of
$400,000 per year, which became effective on January 1, 2005). Employer and Employee agree that
with the exception of

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Employee’s remaining scheduled salary payments from May 17, 2005 through June 30, 2005, the
bonus compensation to be determined and paid to Employee for the one-year period ending July 15,
2005 pursuant to Section 6.2 of the 2003 Employment Agreement (which shall be paid on July 14,
2005), and the reimbursement of any expenses incurred by Employee through June 30, 2005 in
accordance with Employer’s expense reimbursement policy, Employer will owe no further compensation
or other amounts to Employee on July 15, 2003 under the 2003 Employment Agreement, including
without limitation salary, bonus or vacation pay.

     2. New Employment Agreement. Effective as of the Effective Date, Employer hereby
hires Employee as Employer’s President and Chief Executive Officer, and Employee hereby accepts
such employment and position with Employer, on the terms and conditions set forth herein. Employer
understands that his duties as President and Chief Executive Officer may change from time to time
over the term of this Agreement in the discretion of Employer’s Board of Directors, but such duties
shall in all events be consistent with the duties customarily assigned to the Chief Executive
Officer of a company such as Employer.

     3. Duties. Employee shall perform all duties assigned to him by the Employer’s Board
of Directors faithfully, diligently and to the best of his ability. Such duties include, without
limitation, the overseeing and implementation of the business plan adopted by the Board of
Directors (as may be revised from time to time by the Board of Directors). Employee shall perform
the services contemplated under this Agreement in accordance with the policies established by and
under the direction of the Board of Directors. Employee shall have such corporate power and
authority as shall reasonably be required to enable him to discharge his duties under this
Agreement.

     4. Time and Efforts. Subject to the exceptions set forth in this Section 4, Employee
shall devote 100% of his business time, efforts, attention, and energies to Employer’s business in
order to implement Employer’s business plan and discharge his duties under this Agreement.

          4.1. Directorship Exception. Notwithstanding any other provision of this Section 4,
while this Agreement is in effect, Employee may serve on the board of directors of up to three
companies other than Employer, but in no event shall Employee serve on the board of directors of
any company that is directly competitive with Employer or serve as the chairman of any audit
committee or other committee of any other board of directors that requires substantial additional
time on the part of Employee beyond that customarily required to serve as a member of the board of
directors unless such service is approved by the Board of Directors. Employee may make and manage
personal business investments of his choice and serve in any capacity with any civic, educational
or charitable organization, or any governmental entity or trade association, without seeking or
obtaining approval by the Board of Directors, provided such activities and services do not
materially interfere or conflict with the performance of his duties hereunder.

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          4.2. The Kriegsman Group Exception. Notwithstanding any other provision of this
Section 4, Employee may continue to serve as the President and Chairman of the Board of and to
operate The Kriegsman Group while this Agreement is in effect, so long as his involvement with The
Kriegsman Group is strictly limited to completing that company’s current assignments for SuperGen,
Inc. Employee agrees that immediately following completion of the SuperGen, Inc. assignments,
Employee will either (i) terminate the operations of The Kriegsman Group or (ii) retain a new
President for The Kriegsman Group and thereafter cease all personal activities on behalf of The
Kriegsman Group. Nothing contained in this Section 4 shall limit Employee’s right to engage in
activities or receive benefits from The Kriegsman Group solely in his capacity as an equity owner
of that firm.

     5. Term. Employee’s employment under this Agreement shall commence on the Effective
Date and shall continue until July 1, 2008 (the “Expiration Date”), unless sooner terminated by
Employer or Employee in accordance with Section 7 (the “Term”); provided, however, that unless
Employer or Employee gives written notice to the other party to the contrary at least 180 days
prior to the Expiration Date, this Agreement shall automatically be extended for an additional term
of one (1) year following the Expiration Date; and, provided further, that this Agreement shall
continue to renew automatically for an additional term of one (1) year on each anniversary of the
Expiration Date unless Employer or Employee gives written notice to the other party to the contrary
at least 90 days prior to such anniversary date. References herein to the “Term” shall include any
automatic extensions pursuant to the preceding sentence. Provision of a notice that this Agreement
will not be extended shall not constitute a breach of this Agreement.

     6. Compensation. As the total consideration for Employee’s services rendered under
this Agreement, Employer shall pay Employee the following compensation:

          6.1. Salary. Commencing as of the Effective Date, Employer shall pay Employee an
annual salary of $400,000 per year, in 24 equal semi-monthly installments, on the 15th and last day
of each month during the Term. Employee’s annual salary shall be subject to review annually by the
Board of Directors of Employer and may be increased (but not decreased) in the sole discretion of
the Board of Directors or the Compensation Committee of the Board.

          6.2. Bonus Compensation. Employee shall receive an annual cash bonus on the business
day immediately preceding each anniversary of the Effective Date while this Agreement is in effect.
The amount of each such bonus payment shall be determined by Employer’s Board of Directors or
Compensation Committee, in its sole discretion, but in no event shall any such bonus be less than
$150,000 for each year (prorated for any period of less than a full year) during the Term.

          6.3. Stock Options. As has been approved by the Employer’s Board of Directors,
Employer shall grant to Employee as of May 17, 2005 a nonqualified stock option under the Plan to
purchase 300,000 shares of Employer’s common stock at a price

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of $0.79 per share (the “New Option”), which shall have a term of ten years, shall vest
commencing May 17, 2005 in monthly installments of 1/36th each on the 17th
day of each month thereafter, so that the New Option shall be fully vested as to all of the shares
covered thereby on May 17, 2008, provided that Employee shall remain in the continuous employ of
Employer through each such vesting date, and shall have such other terms and conditions as are set
forth in Employer’s Nonqualified Option Agreement evidencing the New Option. Employee also shall
be eligible for future grants of stock options and other equity awards based on Employer stock in
accordance with Employer’s practices and policies with respect to its senior executives.

          6.4. Expense Reimbursement. Employer shall promptly reimburse Employee for reasonable
and necessary business and entertainment expenses incurred by Employee in connection with the
performance of Employee’s duties in accordance with Employer’s usual reimbursement policies and
procedures in effect from time to time.

          6.5. Vacation. Employee shall be entitled to four weeks vacation time for each
12-month period during the Term without loss of compensation. Employee’s vacation shall be
governed by Employer’s usual policies applicable to all employees.

          6.6. Employee Benefit Plans and Fringe Benefits. Employee shall be eligible to
participate in all employee benefit plans and programs, fringe benefits and perquisites as in
effect generally with respect to other senior officers of Employer; provided, however, that unless
and until Employer shall adopt a group medical benefit plan providing health care coverage for its
employees, including Employee, Employer shall continue during the Term to pay on Employee’s behalf
the annual premiums for the medical insurance coverage currently maintained by Employee for himself
and his family. During the Term, Employer shall also continue to make fixed annual premium
payments of $5,000 on the Transamerica Occidental Life Insurance Company policy insuring Employee
under which Employee or his designee is the beneficiary.

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

     7. Termination.

          7.1. Termination by Employer for Cause. Employer may terminate Employee’s employment
hereunder for “Cause” (as defined below), provided that Employer has complied with the provisions
of this Section 7.1. Employee shall be given written notice by Employer’s Board of Directors of
the intention to terminate him for Cause. Such notice shall state in reasonable detail the
particular circumstances that constitute Cause for termination. Employee shall have 15 days after
receiving such notice in which to cure such circumstances, to the extent such cure is possible. If
cure is not possible, or if he fails to cure such circumstances, Employee shall then be entitled to
a hearing before the Board. Such hearing shall be held within 20 days of his receiving

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such notice, provided that he requests such hearing within 15 days of receiving such notice.
If, within five days following such hearing, the Board gives written notice to Employee confirming
that, in the judgment a majority of the members of the Board (excluding Employee), Cause for
terminating his employment on the basis set forth in the original notice exists, the Term and
Employee’s employment hereunder shall be terminated for Cause. The term “Cause” for purposes of
this New Employment Agreement shall mean any of the following:

               (a) Employee has materially breached any material term of this Agreement;

               (b) Employee is (i) convicted of, or has entered a plea of guilty or nolo contendere to, any
felony that in the reasonable judgment of Employer’s Board of Directors is materially injurious to
Employer or its reputation or (ii) is convicted of, or has entered a plea of guilty or nolo
contendere to, any misdemeanor, felony or other crime of moral turpitude that in the reasonable
judgment of the Board of Directors of Employer is materially injurious to Employer or its
reputation; provided, however, that in the event Employee is indicted for, or charged with, the
commission of any felony that in the judgment of the Board of Directors could reasonably be
expected to result in substantial lasting harm to Employer or its reputation, Employer shall be
entitled summarily to suspend Employee’s services to Employer hereunder, without a loss to Employee
of his compensation and other benefits hereunder, during the pendency of such indictment or charge;

               (c) Employee has willfully committed (i) any act of fraud or gross misconduct against
Employer or (ii) any act of fraud or gross misconduct not directly involving Employer that in the
reasonable judgment of the Board of Directors of Employer is materially injurious to Employer or
its reputation; or

               (d) Employee has willfully failed or refused or is legally unable (other than due to his death
or total disability as defined in Section 19), to perform his duties as required under this
Agreement.

          If Employer terminates Employee’s employment for Cause, the termination shall take effect on
the effective date (determined under Section 16) of the final written notice to Employee pursuant
to this Section 7.1, and Employee shall be entitled to (i) a lump sum cash payment, payable within
ten (10) business days after the date of termination of Employee’s employment, equal to the sum of
(A) any accrued but unpaid salary as of the date of such termination, (B) any accrued but unpaid
bonus due under Section 6.2 for any annual period ended prior to the date of such termination and
(C) the minimum bonus under Section 6.2 for the annual period in which such termination occurs,
prorated through the date of such termination, and (ii) such benefits, if any, to which Employee or
his dependents or beneficiaries may then be entitled as a participant under the employee benefit
plans referred to in Section 6.6. In the event of the termination of Employee’s employment for
Cause, Employee’s stock options and any other equity awards based on Employer’s securities, such as
restricted stock, restricted stock units, stock appreciation rights, performance units, etc. shall,
to the

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extent then vested and exercisable, remain vested and exercisable in accordance with their
terms

          7.2. Termination by Employer without Cause. Employer may terminate Employee’s
employment without Cause, which termination shall take effect on the effective date (determined
under Section 16 of this Agreement) of written notice of such termination to Employee. A
termination by Employer in accordance with this Section 7.2 shall not be deemed a breach of this
Agreement. Upon any termination of Employee’s employment by Employer without Cause pursuant to
this Section 7.2, Employee shall be entitled to (i) a lump sum cash payment, payable within ten
(10) business days after the date of termination of Employee’s employment, equal to the sum of (A)
any accrued but unpaid salary as of the date of such termination, (B) any accrued but unpaid bonus
due under Section 6.2 for any annual period ended prior to the date of such termination and (C) the
minimum bonus under Section 6.2 for the annual period in which such termination occurs, prorated
through the date of such termination; (ii) such benefits, if any, to which Employee and his
dependents or beneficiaries may then be entitled as a participant under the employee benefit plans
referred to in Section 6.6; (iii) immediate vesting of all of Employee’s stock options and any
other equity awards based on Employer securities, such as restricted stock, restricted stock units,
stock appreciation rights, performance units, etc, all of which shall remain exercisable for their
full term; (iv) continuation of the life insurance premium payments and medical insurance premium
payments described in Section 6.6 (unless such medical insurance premium payments have been
replaced by participation in an Employer-sponsored medical benefit plan as provided herein)
through the expiration of the then current Term, but in no event for a period of less than 24
months; (vi) continued participation, through the expiration of the then current Term, but in no
event for a period of less than 24 months, of Employee and each of his dependents in any
Employer-sponsored health plan at the benefit level in effect from time to time and with COBRA
benefits commencing thereafter. In addition to the foregoing payments and continuation of
benefits, Employer shall pay Employee in a lump-sum within 10 days following the date of
termination of Employee’s employment an amount equal to the sum of (x) Employee’s salary as
provided in Section 6.1 and (y) the minimum bonus under Section 6.2 that would otherwise be payable
for the period (the “Severance Period”) commencing on the date of termination of Employee’s
employment and ending on the later of (1) the expiration of the Term and (2) the second anniversary
of such termination date.

          7.3. Termination by Employee for Good Reason. Employee may terminate his employment
hereunder for “Good Reason,” which shall mean any material breach by Employer of the terms hereof
that is not corrected by Employer within five days after written notice by Employee to Employer,
including, without limitation, (i) the assignment to Employee of any duties inconsistent in any
respect with his position as Chief Executive Officer (including status, offices, titles, reporting
requirements, authority, duties or responsibilities); (ii) any failure by Employer to comply with
its compensation obligations under this Agreement; or (iii) Employer’s requiring Employee to be
based at any office or location other than in Los Angeles, California or within ten

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miles of the current location of the Company’s headquarters. If Employee terminates his
employment for Good Reason, subject to Employer’s right to cure as set forth above, the termination
shall take effect on the effective date (determined under Section 16) of the written notice to
Employer, and Employee shall be entitled to the same payments and benefits, at the same times,
described in Section 7.2 for a termination by Employer without Cause.

          7.4. Termination by Employee without Good Reason. Employee shall have the right to
voluntarily terminate his employment hereunder at any time without Good Reason upon 30 days’
written notice to Employer. A voluntary termination by Employee in accordance with this Section
7.4 shall not be deemed a breach of this Agreement. Upon any voluntary termination of employment
by Employee without Good Reason pursuant to this Section 7.4, Employee shall be entitled only to
such payments and benefits as those described in Section 7.1 for a termination by Employer for
Cause.

          7.5. Termination in Connection with a Change in Control. For purposes of this Section
7.5, a “Change in Control” shall have the meaning described to such term in Employer’s 2000
Long-Term Incentive Plan. If a Change in Control occurs during the Term, and if, during the Term
and within two years after the date on which the Change in Control occurs, Employee’s employment is
terminated by Employer without Cause or by Employee for Good Reason, then Employee will be entitled
to the payments and benefits, at the same times, described in Section 7.2 for a termination by
Employer without Cause. In addition, to the extent that any payment or distribution of any type to
or for Employee by Employer (which for purposes of this Section 7.5 includes any parent, subsidiary
or affiliate of Employer), whether paid or payable or distributed or distributable pursuant to the
terms of this Agreement or otherwise (including, without limitation, any accelerated vesting of
stock options or other equity awards based on Employer stock granted pursuant to this Agreement or
otherwise) (collectively, the “Total Payments”) is or will be subject to the excise tax (“Excise
Tax”) imposed under Section 4999 of the Internal Revenue Code of 1986, as amended (the “Code”) (or
any successor to such Section), Employer shall pay to Employee, prior to the time any Excise Tax is
payable with respect to any of such Total Payments (through withholding or otherwise), an
additional amount (a “Gross-Up Payment”) that, after the imposition of all income, employment,
excise and other taxes, penalties and interest thereon, is equal to the sum of (i) the Excise Tax
on such Total Payments plus (ii) any penalty and interest assessments associated with such Excise
Tax. The determination of whether any portion of the Total Payments is subject to an Excise Tax
and, if so, the amount and time of any Gross-Up Payment pursuant to this Section 7.5, shall be made
by an independent auditor (the “Auditor”) jointly selected by Employee and Employer and paid by
Employer. If Employee and Employer cannot agree on the firm to serve as the Auditor, then they
shall each select an accounting firm and those two firms shall jointly select the accounting firm
to serve as the Auditor. Unless Employee agrees otherwise in writing, the Auditor shall be a
nationally recognized United States public accounting firm that has not during the two years
preceding the date of its selection, acted in any way on behalf of Employer. Employee and Employer
shall cooperate with

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each other in connection with any proceeding or claim relating to the existence or amount of
any liability for Excise Tax. All expenses relating to any such proceeding or claim (including
attorneys’ fees and other expenses incurred by Employee in connection therewith) shall be paid by
Employer promptly upon demand by Employee, and any such payment shall be subject to a Gross-Up
Payment under this Section 7.5 in the event that Employee is subject to Excise Tax on it.

     8. No Mitigation; No Offset. Employee shall have no obligation to seek other
employment or to otherwise mitigate Employer’s obligations to him arising from the termination of
his employment, and no amounts paid or payable to Employee by Employer under this Agreement shall
be subject to offset for any remuneration to which Employee may become entitled from any other
source after his employment with Employer terminates, whether attributable to subsequent
employment, self-employment or otherwise.

     9. First Offer. Employee acknowledges and agrees that a material inducement to
Employer to enter into this Agreement is the Employee’s expertise in, knowledge of and ability to
identify acquisition candidates within, the biotech, pharmaceutical and health care industries.
Accordingly, Employee agrees that Employee will provide, and will cause The Kriegsman Group for so
long as Employee is the principal owner of The Kriegsman Group to provide, Employer’s Board of
Directors with the first opportunity to conduct or take action with respect to any acquisition
opportunity or any other potential transaction identified by Employee or The Kriegsman Group within
the biotech, pharmaceutical or health care industries and that is within the scope of the business
plan adopted by the Employer’s Board of Directors. Employee’s obligations under this Section 9
shall commence on the Effective Date and shall continue while this Agreement is in effect.

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

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     11. Equitable Remedies; Injunctive Relief. Employee hereby acknowledges and agrees
that monetary damages are inadequate to fully compensate Employer for the damages that would result
from a breach or threatened breach of Sections 9 or 10 hereof and, accordingly, that Employer shall
be entitled to equitable remedies, including, without limitation, specific performance, temporary
restraining orders, and preliminary injunctions and permanent injunctions, to enforce such Sections
without the necessity of proving actual damages in connection therewith. This provision shall not,
however, diminish Employer’s right to claim and recover damages or enforce any other of its legal
or equitable rights or defenses.

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

     13. Binding Agreement. This Agreement shall inure to the benefit of and shall be
binding upon Employer, its successors and assigns and Employee and his heirs and representatives.
Neither party may assign this Agreement without the prior written consent of the other party.

     14. Entire Agreement. This Agreement contains the entire agreement of the parties
relating to the subject matter hereof, and the parties hereto have made no agreements,
representations or warranties relating to the subject matter of this Agreement that are not set
forth otherwise herein. This Agreement supersedes any and all prior agreements, written or oral,
between Employee and Employer relating to the subject matter hereof. Any such prior agreements are
hereby terminated and of no further effect and Employee, by the execution hereof, agrees that any
compensation provided for under any such prior agreements is specifically superseded and replaced
by the provisions of this Agreement. No modification of this Agreement shall be valid unless made
in writing and signed by the parties hereto and unless such writing is made by an executive officer
of Employer (other than Employee) after approval by Employer’s Board of Directors. The parties
hereto agree that in no event shall an oral modification of this Agreement be enforceable or valid.

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

     16. Notice. All notices and other communications under this Agreement shall be in
writing and mailed, telecopied or delivered by hand or by a nationally recognized courier service
guaranteeing overnight delivery to a party at the following address (or to such other address as
such party may have specified by notice given to the other party pursuant to this provision and
shall be effective when personally delivered or two (2) business days after being mailed:

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If to Employer:

CytRx Corporation

11726 San Vicente Boulevard,

Suite 650

Los Angeles, California 90049

Facsimile: (310) 826-5529

Attention: General Counsel

With a copy to:

Sanford J. Hillsberg

Troy & Gould Professional Corporation

1801 Century Park Boulevard

Sixteenth Floor

Los Angeles, California 90067

Facsimile: (310) 201-4746

If to Employee:

Steven A. Kriegsman

The Kriegsman Group

11726 San Vicente Blvd., Suite 650

Los Angeles, CA 90049

Facsimile: (310) 826-5529

With a copy to:

Linda Griffey

O’Melveny & Myers LLP

400 South Hope Street

Los Angeles, CA 90071

Facsimile: (213) 430-6407

     17. Attorneys’ Fees. Employee acknowledges that he has been represented in connection
with this Agreement by O’Melveny & Myers LLP. Employer shall reimburse Employee for up to $6,000
of Employee’s legal fees incurred in connection with the preparation of this Agreement.

     18. Arbitration. The parties agree if any controversy or claim shall arise out of
this Agreement or the breach hereof (other than claims (a) for equitable relief, including specific
performance, injunctive relief or temporary restraining orders or (b) enforcing this Section 18 or
an arbitration award granted in accordance herewith), and either party shall request that the
matter be settled by arbitration the matter shall be settled exclusively by final and binding
arbitration before JAMS (or its successor pursuant to the United States Arbitration Act, 9 U.S.C.
Section 1 et seq.) in accordance

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with the provisions of JAMS’ Streamlined Arbitration Rules and Procedures in effect at such
time, by a single arbitrator, if the parties shall agree upon one, or by one arbitrator appointee
by each party and a third arbitrator appointed by the other arbitrators. In case of any failure of
a party to make an appointment referred to above within two (2) weeks after written notice of
controversy, such appointment shall be made by JAMS. All arbitration proceedings shall be held in
the City of Los Angeles, and each party agrees to comply in all respects with any award made in
such proceeding and to the entry of a judgment in any jurisdiction upon any award rendered in such
proceeding. Each party will pay the fees of their respective attorneys, the expenses of their
respective witnesses, costs of any record or transcript of the arbitration, and any other expenses
connected with the arbitration that such party might be expected to incur had the dispute been
subject to resolution in court, but all costs of the arbitration that would not be incurred by the
parties if the dispute was litigated in court, including fees of the arbitrator and any arbitration
association administrative fees will be paid by Employer.

     19. Death or Disability. In the event of Employee’s death or “Disability” (as defined
below) during the Term, the Employee’s employment shall automatically cease and terminate as of the
date of Employee’s death or the effective date of Employer’s written notice to Employee of its
decision to terminate his employment by reason of his Disability, as the case may be, and Employee
shall be entitled to the same payments and benefits, at the same times, as described in Section 7.2
for a termination of employment by Employer without Cause. Likewise, any stock options and other
equity awards held by Employee at the time of his death or Disability shall immediately vest in
full upon such termination and shall remain exercisable thereafter for the full term of such
options and equity rights. Notwithstanding the foregoing or any provision of Section 7.2,
Employer’s obligation to pay Employee the salary and bonus called for in Section 7.2 during the
Severance Period following termination of his employment by reason of his Disability shall be
subject to offset and shall be reduced by any and all amounts paid to Employee under any disability
insurance policy paid or provided for by Employer as provided in Section 6.6 or otherwise. For
purposes of this Agreement, the term “Disability” means the inability of Employee to perform
substantially all of his duties hereunder for any period of at least 120 consecutive days by reason
of any physical or mental incapacity.

     20. Survival. In the event this Agreement expires after its Term or is terminated,
the provisions of Sections 7, 10, 11, 12, 15, 16, 18, 19 and 22 shall survive.

     21. Counterparts. This Agreement may be executed in counterparts, each of which shall
be deemed to be an original and all of which together shall be deemed to be one and the same
agreement.

     22. Indemnification.

          22.1. Employer Indemnity. If Employee is made a party, or is threatened to be made a
party, to any action, suit or proceeding, whether civil, criminal, administrative or investigative
(a “Proceeding”), by reason of the fact that he is or was a director, officer or employee of
Employer or any affiliate of Employer or was serving at

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the request of Employer or any affiliate of Employer as a director, officer, member, employee
or agent of another corporation, partnership, joint venture, trust or other enterprise, including
service with respect to employee benefit plans, whether or not the basis of such Proceeding is
Employee’s alleged action in an official capacity while serving as a director, officer, member,
employee or agent, then Employer will indemnify Employee and hold him harmless to the fullest
extent legally permitted or authorized by Employer’s certificate of incorporation or bylaws or
resolution of the Board of Directors to the extent not inconsistent with the laws of the State of
Delaware, against all cost, expense, liability and loss (including, without limitation, attorneys’
fees, judgments, fines, ERISA excise taxes or penalties and amounts paid or to be paid in
settlement) reasonably incurred or suffered by Employee in connection therewith, except to the
extent attributable to Employee’s gross negligence or fraud), and such indemnification shall
continue as to Employee even if he has ceased to be a director, member, officer, employee or agent
of Employer or affiliate and shall inure to the benefit of Employee’s heirs, executors and
administrators. Employer will advance to Employee all reasonable costs and expenses to be incurred
by him in connection with a Proceeding within 20 days after receipt by Employer of a written
request for such advance. Such request shall include an undertaking by Employee to repay the
amount of such advance if it shall ultimately be determined that he is not entitled to be
indemnified against such costs and expenses. The provisions of this subsection 22.1 shall not be
deemed exclusive of any other rights of indemnification to which Employee may be entitled or which
may be granted to him and shall be in addition to any rights of indemnification to which he may be
entitled under any policy of insurance.

          22.2. No Presumption Regarding Standard of Conduct. Neither the failure of Employer
(including its Board of Directors, independent legal counsel or stockholders) to have made a
determination prior to the commencement of any proceeding concerning payment of amounts claimed by
Employee under the preceding subsection 22.1 of this Section 22 that indemnification of Employee is
proper because he has met the applicable standard of conduct, nor a determination by Employer
(including its Board of Directors, independent legal counsel or stockholders) that Employee has not
met such applicable standers of conduct, shall create a presumption the Employer has not met the
applicable standard of conduct.

          22.3. Liability Insurance. Employer will continue and maintain a directors and
officers liability insurance policy covering Employee to the extent Employer provides such coverage
for its other senior executive officers.

-12-

 

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

	 	 	 	 	 
	 	“EMPLOYER”

CytRx Corporation,

a Delaware corporation

 	 
	 	By:  	/s/ MAX LINK
 	 
	 	 	Name:  	Max Link, Ph.D. 	 
	 	 	Title:  	Chairman of the Board 	 
	 

	 	 	 	 	 
	 	“EMPLOYEE”

 	 
	 	/s/ STEVEN A. KRIEGSMAN
 	 
	 	Steven A. Kriegsman 	 
	 	 	 
	 

-13-exv10w2

 

EXHIBIT 10.2

AMENDED AND RESTATED EMPLOYMENT AGREEMENT

     This Amended and Restated Employment Agreement (this “Agreement”) is made and entered
into as of May 17, 2005 by and between CytRx Corporation, a Delaware corporation
(“Employer”), and Matthew Natalizio, an individual and resident of the State of California
(“Employee”).

     WHEREAS, Employer and Employee previously entered into an Employment Agreement dated July 12,
2004 (the “Original Employment Agreement”), under which Employee has served as Chief
Financial Officer of Employer, and Employer and Employee have agreed that the terms of the Original
Employment Agreement will expire on June 30, 2005.

     WHEREAS, Employer and Employee desire to enter into a new employment agreement under which
Employee shall serve on a full-time basis as Employer’s Chief Financial Officer on the terms set
forth in this Agreement, with the term of this new employment agreement to commence on July 1, 2005
(the “Effective Date”).

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

     1. Continuation and Expiration of Original Employment Agreement. Employer and
Employee agree that Employee shall continue to be employed as Employer’s Chief Financial Officer
under the terms of the Original Employment Agreement through June 30, 2005.

     2. New Employment Agreement. Effective as of the Effective Date, Employer shall
employ Employee, and Employee shall serve, as Employer’s Chief Financial Officer on the terms set
forth in Sections 2 through 19 hereof, which shall constitute Employee’s new employment agreement
with Employer (the “New Employment Agreement”).

     3. Duties; Place of Employment. Employee shall perform in a professional and
business-like manner, and to the best of his ability, the duties described on Schedule 1 to this
Agreement and such other duties as are assigned to him from time to time by Employer’s Chief
Executive Officer. Employee understands and agrees that his duties, title and authority may be
changed from time to time in the discretion of Employer’s Chief Executive Officer. Employee’s
services hereunder shall be rendered at Employer’s principal executive offices, except for travel
when and as required in the performance of Employee’s duties hereunder.

     4. Time and Efforts. Employee shall devote all of his business time, efforts,
attention and energies to Employer’s business and the discharge his duties hereunder.

 

 

     5. The term (the “Term”) of Employee’s employment under the New Employment Agreement
shall commence on the Effective Date and shall expire on the first anniversary thereof, unless
sooner terminated in accordance with Section 7. Neither Employer nor Employee shall have any
obligation to extend or renew the New Employment Agreement. In the event the New Employment
Agreement shall not be extended or renewed by Employer beyond the Term, Employer shall continue to
pay Employee his salary as provided for in Section 6.1 during the period commencing on the date on
which the Term ends and ending on (a) October 1, 2006 or (b) the date of Employee’s re-employment
with another employer, whichever is earlier.

     6. Compensation. As the total consideration for Employee’s services rendered under
the New Employment Agreement, Employer shall pay or provide Employee the following compensation and
benefits:

          6.1. Salary. Employee shall be entitled to receive an annual salary of One Hundred
Ninety-Five Thousand Dollars ($195,000), payable in 24 semi-monthly installments on the
15th day and the last day of each calendar month during the Term, with the first such
installment due on July 15, 2005.

          6.2. Discretionary Bonus. Employee may be eligible for an annual bonus for his
services during the Term. Employee’s eligibility to receive a bonus, any determination to award
Employee such a bonus and, if awarded, the amount thereof shall be in Employer’s sole discretion.

          6.3. Stock Options. Employer shall grant Employee as of the date hereof a
nonqualified stock option under Employer’s 2000 Long-Term Incentive Plan (the “Plan”) to
purchase 150,000 shares of Employer’s common stock (the “Option”). The Option shall vest
and become exercisable in 36 equal monthly installments beginning on the one-month anniversary of
the date of grant, provided, in each case, that Employee remains in the continuous employ of
Employer through such anniversary date. The Option shall (a) be exercisable at an exercise price
equal to $0.79 per share, (b) have a term of ten years, and (c) be on such other terms as shall be
determined by Employer’s Board of Directors (or the Compensation Committee of the Board) and set
forth in a customary form of stock option agreement under the Plan evidencing the Option.
Notwithstanding anything to the contrary in Section 7.2 or other provision of this Agreement or of
the stock option agreement evidencing the Option, upon the occurrence of a “Change in Control” (as
defined in the Plan), the Option shall thereupon vest and become exercisable as to all of the
shares covered thereby in accordance with the terms of the Plan.

          6.4. Expense Reimbursement. Employer shall reimburse Employee for reasonable and
necessary business expenses incurred by Employee in connection with the performance of Employee’s
duties in accordance with Employer’s usual practices and policies in effect from time to time, as
approved by Employer’s Chief Executive Officer.

          6.5. Vacation. Employee shall be entitled to fifteen business days of vacation each
year during the Term in accordance with California law.

 

 

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

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

     7. Termination. The New Employment Agreement may be terminated as set forth in this
Section 7.

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

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

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

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

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

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

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

 

 

     Upon termination of Employee’s employment by Employer for Cause, all compensation and benefits
to Employee hereunder shall cease and Employee shall be entitled only to payment, not later than
three days after the date of termination, of any accrued but unpaid salary and unused vacation as
provided in Sections 6.1 and 6.5 as of the date of such termination and any unpaid bonus that may
have been previously awarded Employee as provided in Section 6.2 prior to such date.

          7.2. Termination by Employer without Cause. Employer may also terminate Employee’s
employment without Cause upon five days notice to Employee. Upon termination of Employee’s
employment by Employer without Cause, all compensation and benefits to Employee hereunder shall
cease and Employee shall be entitled to payment of (a) any accrued but unpaid salary and unused
vacation as of the date of such termination as required by California law, which shall be due and
payable upon the effective date of such termination, and (b) an amount (the “Severance
Amount”), which shall be due and payable within ten days following the effective date of such
termination, equal to three months’ salary as provided in Section 6.1.

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

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

 

 

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

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

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

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

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

     14. Amendment. No modification of the New Employment Agreement shall be valid unless
made in writing, approved by the Compensation Committee and signed by the parties hereto and unless
such writing is made by an executive officer of Employer

 

 

(other than Employee). The parties hereto agree that in no event shall an oral modification
of the New Employment Agreement be enforceable or valid.

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

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

If to Employer:

CytRx Corporation

11726 San Vicente Boulevard, Suite 650

Los Angeles, California 90049

Facsimile: (310) 826-5529

Attention: Chief Executive Officer

If to Employee:

Mr. Matthew Natalizio

3115 Brookhill Street

La Crescenta, California 91214

     17. Survival. Sections 8 through 17 shall survive the expiration or termination of
the New Employment Agreement.

     18. Counterparts. This Agreement may be executed in counterparts, each of which shall
be deemed to be an original and all of which together shall be deemed to be one and the same
agreement.

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

 

 

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

	 	 	 	 	 
	 	“EMPLOYER”

CytRx Corporation

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

	 	 	 	 	 
	 	“EMPLOYEE”

 	 
	 	/s/ MATTHEW NATALIZIO
 	 
	 	Matthew Natalizio

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