Document:

<PAGE>

                                                                         Ex 10.3

Portions of this document are subject to an application for confidential
treatment, and as such have been omitted from this document. The portions that
have been omitted are indicated in the text by the marking {***}. The omitted
information has been filed separately with the Securities and Exchange
Commission.

                COLLABORATION AND INVENTION DISCLOSURE AGREEMENT

      THIS AGREEMENT, effective as of July 8, 2004 (the "Effective Date"), is
between the University of Massachusetts, as represented solely by the Medical
School at its Worcester campus (the "Medical School"), a public institution of
higher education of the Commonwealth of Massachusetts, and CytRx Corporation
("Company"), a Delaware corporation.

                                 R E C I T A L S

      WHEREAS, the University of Massachusetts has licensed technologies from
the Medical School to Company in several fields;

      WHEREAS, the Company would like to receive disclosures of future Medical
School technologies that are related to the existing licenses of Company; and

      WHEREAS, the Medical School is willing to disclose technology within the
fields of RNAi, diabetes, obesity, neurodegenerative diseases including ALS, and
CMV and including the fields of Company's current licenses with the Medical
School according to the terms of this Agreement.

      THEREFORE, Medical School and Company agree as follows:

1. Disclosure.

      1.1. Definitions.

            (a) "Field" means the fields of RNAi, diabetes, obesity,
neurodegenerative diseases including ALS, and CMV.

            (b) "Patent Rights" means invention disclosures, patent
applications, and patents that are not obligated to other parties (e.g., by
sponsored research agreement) for license by the Medical School within the
Field.

      1.2. Disclosure. After the initial internal disclosure according to
Medical School policy, the Medical School shall promptly disclose in writing to
Company Patent Rights in the Field that are conceived or reduced to practice by
the Medical School during the term of this Agreement and within one (1) year
thereafter.

      1.3. Sponsored Research Agreements. Concurrently with the execution of
this Agreement, the Medical School shall provide a written list of its existing
sponsored research agreements that are directed to research in the Field.

<PAGE>

      1.4. Warranty Disclaimer. The Medical School represents and warrants that
its employees are required to assign to Medical School their entire right,
title, and interest in the Patent Rights and that it has authority to grant the
disclosure right set forth in this Agreement. MEDICAL SCHOOL MAKES NO OTHER
WARRANTIES CONCERNING THE PATENT RIGHTS, INCLUDING WITHOUT LIMITATION ANY
EXPRESS OR IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR
PURPOSE. Specifically, Medical School makes no warranty or representation (a)
regarding the validity, scope, or patentability of any Patent Rights, (b) that
the exploitation the Patent Rights will not infringe any patents or other
intellectual property rights of a third party, and (c) that any third party will
not infringe the Patent Rights.

2. Consideration for Disclosure Right. In consideration of the rights granted
Company under this Agreement, Company shall pay to Medical School a
nonrefundable disclosure fee of One Million Five Hundred Thousand Dollars
($1,500,000), payable in eight equal quarterly installments, One Hundred
Eighty-Seven Thousand Five Hundred Dollars ($187,500) on the Effective Date and
One Hundred Eighty-Seven Thousand Five Hundred Dollars ($187,500) at the
beginning of each quarter year after the Effective Date

3. Option to License Patent Rights.

      (a)   If Company would like an exclusive option to license any particular
            Patent Rights that the Medical School discloses, Company must pay
            the Medical School a nonrefundable option fee of {***}. After timely
            receipt of said {***} from Company, Medical School grants Company a
            first option to obtain a worldwide, royalty-bearing, exclusive
            license with the right to sublicense under its rights in any
            identified disclosure of Patent Rights to the Company in the Field
            (the "Option Right"). Company must exercise the Option Right
            including making the foregoing option payment, upon written notice
            to Medical School that is received by Medical School within sixty
            (60) days after receipt of the disclosure pursuant to Section 1.2
            (the "Option Period"). However, the option fee is {***} for any
            Patent Rights relating to nucleic acid delivery, stability,
            formulations, or modifications of nucleic acid that may improve the
            pharmacological properties of RNAi gene silencing where at least one
            (1) inventor is Michael Czech, Timothy Kowalik, Shan Lu, Tariq Rana,
            or Zuoshang Xu.

      (a)   If Company elects not to exercise the Option Right, or fails to
            exercise the Option Right during the Option Period, Medical School
            is free to license its rights under the Patent Rights to any third
            party. If Company does elect to exercise the Option Right, Medical
            School and Company shall negotiate in good faith a license agreement
            containing commercially reasonable terms. Said option fee is
            creditable against payments received under the terms of the
            negotiated license agreement. If Medical School and Company do not
            reach agreement within six (6) months after Company exercises the
            Option Right (the "Negotiation Period"), Medical School is free to

<PAGE>

            license its rights under the Patent Rights to any third party.
            However, if the parties fail to reach an agreement within the
            Negotiation Period, for a period of one (1) year after the
            Negotiation Period expires the following terms apply:

            (i)   Within five (5) business days after expiration of the
                  Negotiation Period, Company may elect to have the terms of the
                  license determined by arbitration by delivering written notice
                  of that election to Medical School. If Company elects
                  arbitration, the arbitration shall be conducted in Boston,
                  Massachusetts, by one (1) independent arbitrator who is
                  experienced in licensing biotechnology intellectual property.
                  The arbitrator shall be chosen by mutual consent of the
                  parties within sixty (60) days after Company elects
                  arbitration. Company shall pay the first Ten Thousand Dollars
                  ($10,000) of the expenses of the arbitration, and thereafter
                  the parties shall share the expenses equally. Each party is
                  responsible for its own legal expenses in association with the
                  arbitration. The arbitration shall be in a format in which the
                  arbitrator shall rule that either Company's or Medical
                  School's proposed terms are the final terms. Once the terms
                  have been established by the arbitrator and delivered in
                  writing to Company, Company has ten (10) days to agree to
                  enter into the license agreement on those terms or to reject
                  those terms. If Company rejects those terms, Medical School
                  thereafter is free to license its rights under the Patent
                  Rights to any third party without further notice to Company,
                  provided that the terms of that license are no more favorable
                  to the licensee than those that were proposed by Company in
                  the arbitration.

            (ii)  If Company does not elect arbitration pursuant to Section
                  3(b)(i), Medical School is free to license its rights under
                  the Patent Rights to any third party, provided that the terms
                  of that license are no more favorable to the licensee than the
                  last offer made by Medical School to Company, unless Medical
                  School first provides Company with written notice of Medical
                  School's intention to make a more favorable offer (the
                  "Proposed Offer") and Company either declines in writing to
                  accept the Proposed Offer or fails to respond to the Proposed
                  Offer within thirty (30) days after receiving the notice.

4. Maintenance of and Responsibility for Patent Rights. Medical School is
responsible at its expense and in its sole discretion for the preparation,
filing, prosecution, and maintenance of the Patent Rights.

5. Information Exchange.

      5.1. Purpose. During the term of this Agreement, Company and Medical
School are likely to exchange information relating to the Patent Rights. The
following provisions are

<PAGE>

intended to protect the confidential or proprietary information of each party
during this period of information exchange.

      5.2. Definition of Confidential Information. "Confidential Information"
means any confidential or proprietary information furnished by one party (the
"Disclosing Party") to the other party (the "Receiving Party") in connection
with this Agreement, provided that the information is specifically designated as
confidential. Confidential Information includes, without limitation, any
information relating to the Patent Rights. The Disclosing Party shall mark
Confidential Information that is disclosed in writing with a legend indicating
its confidential status (such as, "Confidential" or "Proprietary"). The
Disclosing Party shall document Confidential Information that is disclosed
orally or visually in a written notice and deliver it to the Receiving Party
within thirty (30) days after the disclosure. The notice shall summarize the
Confidential Information disclosed to the Receiving Party and reference the time
and place of disclosure.

      5.3. Obligations. For five (5) years after disclosure of any portion of
Confidential Information, the Receiving Party shall (a) maintain Confidential
Information in confidence, except that the Receiving Party may disclose or
permit the disclosure of any Confidential Information to its directors,
officers, employees, consultants, and advisors who are obligated to maintain the
confidential nature of Confidential Information and who need to know
Confidential Information for the purposes of this Agreement; (b) use
Confidential Information solely for the purposes of this Agreement; and (c)
allow its trustees or directors, officers, employees, consultants, and advisors
to reproduce the Confidential Information only to the extent necessary for the
purposes of this Agreement, with all reproductions being Confidential
Information.

      5.4. Exceptions. The obligations of the Receiving Party under Section 5.3.
above do not apply to the extent the Receiving Party can demonstrate that the
Confidential Information (a) was in the public domain prior to the time of its
disclosure under this Agreement; (b) entered the public domain after the time of
its disclosure under this Agreement through means other than an unauthorized
disclosure resulting from an act or omission by the Receiving Party; (c) was
independently developed or discovered by the Receiving Party without use of the
Confidential Information; (d) is or was disclosed to the Receiving Party at any
time, whether prior to or after the time of its disclosure under this Agreement,
by a third party having no fiduciary relationship with the Disclosing Party and
having no obligation of confidentiality with respect to the Confidential
Information; or (e) is required to be disclosed to comply with applicable laws
or regulations, or with a court or administrative order, provided that the
Disclosing Party receives reasonable prior written notice of the disclosure.

      5.5. Ownership and Return. The Receiving Party acknowledges that the
Disclosing Party (or any third party entrusting its information to the
Disclosing Party) owns its Confidential Information in the possession of the
Receiving Party. Upon the expiration or termination of this Agreement, or at the
request of the Disclosing Party, the Receiving Party shall return to the
Disclosing Party all originals, copies, and summaries of documents, materials,
and other tangible

<PAGE>

manifestations of Confidential Information in the possession or control of the
Receiving Party, except the Receiving Party may retain one copy of the
Confidential Information solely for the purpose of monitoring its obligations
under this Agreement.

6. Term and Termination.

      6.1. Term. This Agreement commences on the Effective Date and remains in
effect for two (2) years, unless earlier terminated in accordance with the
provisions of this Agreement. However, Section 1.2 and Article 3 survive
expiration of the term of this Agreement in accordance with the terms of those
sections. Company may extend the term for one (1) additional year upon payment
of Seven Hundred Fifty Thousand Dollars ($750,000), payable in four equal
quarterly installments to Medical School of One Hundred Eighty-Seven Thousand
Five Hundred Dollars ($187,500) commencing on the second anniversary of the
Effective Date and at the beginning of each quarter thereafter.

      6.2. Termination for Default. If either party commits a material breach of
its obligations under this Agreement and fails to cure that breach within sixty
(60) days after receiving written notice thereof, the other party may terminate
this Agreement immediately upon written notice to the party in breach. If the
alleged breach involves nonpayment of any amounts due Medical School under this
Agreement, Company shall have only one opportunity to cure a material breach for
which it receives notice as described above; any subsequent material breach by
Company will entitle Medical School to terminate this Agreement immediately upon
written notice to Company, without the sixty-day cure period.

      6.3. Effect of Termination. The following provisions survive the
expiration or termination of this Agreement: Articles 3 and 5; Sections 1.2.,
7.1., and 7.6.

      6.4. Force Majeure. Neither party is responsible for delays resulting from
causes beyond its reasonable control, including without limitation, fire,
explosion, flood, war, strike, or riot, provided that the nonperforming party
uses commercially reasonable efforts to avoid or remove those causes of
nonperformance and continues performance under this Agreement with reasonable
dispatch whenever the causes are removed.

7. Miscellaneous.

      7.1. Publicity Restrictions. Neither party may use the name of the other
or any of its trustees, officers, faculty, students, employees, or agents, or
any adaptation of those names, or any terms of this Agreement in any promotional
material or other public announcement or disclosure without the prior written
consent of the other party. The foregoing notwithstanding, Company may disclose
such information without the consent of Medical School in any prospectus,
offering memorandum, or other document or filing required by applicable
securities laws or other applicable law or regulation, provided that Company
shall provide Medical School at least ten (10) days' (or a shorter period in
order to enable Company to make a timely

<PAGE>

announcement, while affording Medical School the maximum feasible time to review
the announcement) prior written notice of the proposed text for the purpose of
giving Medical School the opportunity to comment on the text.

      7.2. Research Partially Funded by Grants.

            (a) Federal Government. To the extent that any invention claimed in
the Patent Rights has been partially funded by the federal government, this
Agreement and the grant of any rights in the invention is subject to and
governed by federal law as set forth in 35 U.S.C. Sections 201-211 and the
regulations promulgated thereunder, as amended, or any successor statutes or
regulations. If any term of this Agreement fails to conform to those laws and
regulations, the relevant term is invalid and the parties shall modify the term
pursuant to Section 7.8.

            (b) Other Organizations. To the extent that any invention claimed in
the Patent Rights has been partially funded by a non-profit organization or
state or local agency, this Agreement and the grant of any rights in the
invention is subject to and governed by the terms of the applicable research
grant. If any term of this Agreement fails to conform to those terms, the
relevant term is invalid and the parties shall modify the term pursuant to
Section 7.8.

      7.3. Tax-Exempt Status. Company acknowledges that Medical School, as a
public institution of the Commonwealth of Massachusetts, is an exempt
organization under the United States Internal Revenue Code. Company also
acknowledges that certain facilities in which the inventions subject to the
license disclosure were developed may have been financed through offerings of
tax-exempt bonds. If the Internal Revenue Service determines, or if counsel to
Medical School reasonably determines, that any term of this Agreement
jeopardizes the tax-exempt status of Medical School or the bonds used to finance
Medical School facilities, the relevant term is invalid and the parties shall
modify the term pursuant to Section 7.8.

      7.4. Assignment. This Agreement may not be assigned by either party
without the prior written consent of the other party, including without
limitation, in connection with a merger, consolidation, or sale of all or
substantially all of its assets or that portion of its business (including any
subsidiary) to which this Agreement relates, which consent may not be
unreasonably withheld or delayed.

      7.5. Amendment and Waiver. This Agreement may be amended, supplemented, or
otherwise modified only by means of a written instrument signed by both parties.
Any waiver of any rights or failure to act in a specific instance relates only
to that instance and is not an agreement to waive any rights or fail to act in
any other instance, whether or not similar.

      7.6. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the Commonwealth of Massachusetts irrespective of
any conflicts of law principles. Any action regarding this Agreement shall be
brought in Massachusetts Superior Court, Suffolk County.

<PAGE>

      7.7. Notice. Any notices required or permitted under this Agreement shall
be in writing, shall specifically refer to this Agreement, and shall be sent by
recognized national overnight courier or registered or certified mail, postage
prepaid, return receipt requested, to the following addresses of the parties:

If to Medical School:

Office of Technology Management
University of Massachusetts
365 Plantation Avenue
Worcester, MA  01655
Attention: Executive Director

If to Company:

CytRx Corporation
11726 San Vicente Boulevard, Suite 650
Los Angeles, California 90049
      Attention:    Steven A. Kriegsman
      Invoices to:  Steven A. Kriegsman

All notices under this Agreement are effective upon receipt. A party may change
its contact information immediately upon written notice to the other party in
the manner provided in this Section.

      7.8. Severability. If any provision of this Agreement is held invalid or
unenforceable for any reason, the invalidity or unenforceability does not affect
any other provision of this Agreement, and the parties shall negotiate in good
faith to modify the Agreement to preserve (to the extent possible) their
original intent.

      7.9. Entire Agreement. This Agreement constitutes the entire agreement
between the parties with respect to its subject matter and supersedes all prior
agreements or understandings between the parties relating to its subject matter.
The parties acknowledge that this Agreement has no effect on and does not limit
any of Company's rights under any specific license or sponsored research
agreements that have been executed between the parties prior to or within thirty
(30) days after the Effective Date.

      The parties have caused this Agreement to be executed by their duly
authorized representatives as of the Effective Date.

<PAGE>

UNIVERSITY OF MASSACHUSETTS                 CYTRX CORPORATION

By: /s/ CHESTER A. BISBEE, Ph.D., J.D.      By: /s/ STEVEN A. KRIEGSMAN
    -----------------------------------         --------------------------------
Name:  Chester A. Bisbee, Ph.D., J.D.       Name:  Steven A. Kriegsman
Title: Assistant Director, OTM              Title: Chief Executive Officer<PAGE>

                                                                         Ex 10.4

                              EMPLOYMENT AGREEMENT

      This Employment Agreement (this "Agreement") is made and entered into as
of July 6, 2004 (the "Effective Date") by and between CytRx Corporation, a
Delaware corporation ("Employer"), and Jack Barber, an individual and resident
of the State of California ("Employee").

      WHEREAS, Employer desires to engage Employee as an employee, and Employee
is willing to be so engaged by Employer, on the terms set forth in this
Agreement.

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

      1. Employment. Effective as of the Effective Date, Employer shall employ
Employee, and Employee shall serve, as Employer's Senior Vice President-Drug
Development on the terms set forth herein.

      2. 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. Notwithstanding the foregoing, Employer understands and agrees that,
so long as he resides in San Diego County, Employee shall be entitled in his
discretion to render his services hereunder from his home on Friday of each
week.

      3. 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.

      4. Term. The term (the "Term") of Employee's employment hereunder shall
commence on the Effective Date and shall expire on the first anniversary
thereof, unless sooner terminated in accordance with Section 6. Neither Employer
nor Employee shall have any obligation to extend or renew this Agreement. In the
event this Agreement shall not be extended or renewed, Employer shall continue
to pay Employee his salary as provided for in Section 5.1 during the period
commencing on the date of the termination of Employee's employment with Employer
and ending on (a) October 6, 2005 or (b) the date of Employee's re-employment
with another employer, whichever is earlier.

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

<PAGE>

            5.1. Salary. Employee shall be entitled to receive an annual salary
of Two Hundred Thirty Thousand Dollars ($230,000), 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, 2004.

            5.2. 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.

            5.3. Stock Options. Employer shall grant Employee as of the
Effective Date a nonqualified stock option under Employer's 2000 Long-Term
Incentive Plan (the "Plan") to purchase 100,000 shares of Employer's common
stock (the "Option"). The Option shall vest and become exercisable as to
one-third of the shares covered thereby on each of the first, second and third
annual anniversaries of the Effective Date, 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 (i)
$1.13 per share or (ii) the last sale price of Employer's common stock on the
Effective Date as reported on the Nadsaq SmallCap Market, whichever is greater,
(b) have a term of ten years, and (c) be on such other terms as shall be
determined by Employer's Board of Directors (or the Compensation Committee of
the Board) and set forth in a customary form of stock option agreement under the
Plan evidencing the Option. Notwithstanding anything to the contrary in Section
6.2 or other provision of this Agreement or of the stock option agreement
evidencing the Option, upon the occurrence of a "Change in Control" (as defined
in the Plan), the Option shall thereupon vest and become exercisable as to all
of the shares covered thereby in accordance with the terms of the Plan.

            5.4. 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.

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

            5.6. 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 and policies now or hereafter in effect may be modified or terminated by
Employer at any time in its discretion.

            5.7. 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.

                                       2
<PAGE>

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

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

                  (a) Employee's breach of any material term of this Agreement;
provided that the first occasion of any particular breach shall not constitute
such Cause unless Employee shall have previously received written notice from
Employer stating the nature of such breach and affording Employee at least ten
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 this 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 5.1 and 5.5 as of the date of such termination and any unpaid bonus
that may have been awarded Employee as provided in Section 5.2 prior to such
date.

            6.2. Termination by Employer without Cause. Employer may also
terminate Employee's employment without Cause upon 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

                                       3
<PAGE>

such termination, equal to 1/360th of Employee's salary provided for in Section
5.1 for each four days (prorated for any period of less than four days) that
Employee was employed hereunder prior to the date of such termination of
employment. By way of example, if Employer were to terminate Employee's
employment without Cause 60 days after the date hereof, the Severance Amount
payable to Employee would be $9,583 (i.e., [60 / 4] / 360 multiplied by
$230,000). Employer and Employee agree that, if this Agreement is extended or
renewed, unless Employer and Employee agree otherwise, the Severance Amount
under this Section 6.2 shall be fixed at three months' salary provided for in
Section 5.1.

            6.3. Death or Disability. Employee's employment will terminate
automatically in the event of Employee's death or upon notice from Employer in
event of his permanent disability. Employee's "permanent disability" shall have
the meaning ascribed to such term in any policy of disability insurance
maintained by Employer (or 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.

      7. Confidentiality. While this Agreement is in effect and for a period of
five years thereafter, Employee shall hold and keep secret and confidential all
"trade secrets" (within the meaning of applicable law) and other confidential or
proprietary information of Employer and shall use such information only in the
course of performing Employee's duties hereunder; provided, however, that with
respect to trade secrets, Employee shall hold and keep secret and confidential
such trade secrets for so long as they remain trade secrets under applicable
law. Employee shall maintain in trust all such trade 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.

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

                                       4
<PAGE>

however, diminish Employer's right to claim and recover damages or enforce any
other of its legal or equitable rights or defenses.

      9. Indemnification; Insurance. Employer and Employee acknowledge that, as
the Senior Vice President-Drug Development of the 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 or Articles of
Incorporation and Bylaws as in effect as of the date of this Agreement. Subject
to his insurability thereunder, effective the Effective Date, Employer shall add
Employee as an additional insured under its current policy of directors and
officers liability insurance and shall use commercially reasonable efforts to
continue to insure Employee thereunder, or under any replacement policies in
effect from time to time, during the Term.

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

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

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

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

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

      15. Notice. All notices and other communications under this Agreement
shall be in writing and mailed, telecopied (in case of notice to Employer only)
or delivered by hand or by a nationally recognized courier service guaranteeing
overnight delivery to a

                                       5
<PAGE>

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. Jack Barber
            11987 Caneridge Place
            San Diego, CA 92128

      16. Survival. Sections 7 through 16 shall survive the expiration or
termination of this Agreement.

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

      18. Attorney's Fees. In any action or proceeding to construe or enforce
any provision of this Agreement the prevailing party shall be entitled to
recover its or his reasonable attorneys' fees and other costs of suit 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/ JACK BARBER
                                             -----------------------------------
                                             Jack Barber

                                       6
<PAGE>

                                   Schedule 1

                          LIST OF DUTIES - JACK BARBER
                     Senior Vice President, Drug Development

      -     Review and supervision of all pre-clinical and clinical programs
            including clinical progress of HIV project, which includes
            developing a relationship with ABL, Dr. Kennedy and Shan Lu.
            Preparation and filing of NIH grant for a phase II trial.

      -     CMV Project: Supervising Dr. Timothy Kowalik and moving project as
            quickly as possible into the clinic.

      -     ALS Program: Working with UMass, Mass General, Zuoshang Xu and
            Robert Brown Jr. to move program into the clinic as soon as
            possible. Working on either getting a vector or other technology
            that can be used to get a drug into the clinic. Preparation of the
            IND. Contacting and dealing with the FDA on setting up a pre-IND
            meeting with them before the end of the year, 2004.

      -     Reporting to the CEO on the progress of each of these areas on a
            weekly basis in writing.

      -     Working with the members of the management team.

      -     CytRx Laboratories: Working with Mark A. Tepper, Ph.D. and members
            of the Scientific Advisory Board as needed or as requested by Mark
            Tepper. Communicate and make suggestions to the CEO based on
            observations of programs. (i.e.: need more information, going in the
            wrong direction)

      -     Handling all of CytRx IP matters. Working out a delegation between
            Mark, who will do diabetes and obesity, and you who will do
            everything else. Coordinating IP matters with our new counsel, Ben
            Levin, as well as outside IP counsel (currently Fish & Neave and
            Kilpatrick and Stockton).

                                     S1 - 1
<PAGE>

      -     Making sure that all patent work is handled on a timely basis so
            that we don't go delinquent. Reviewing any patents still in force on
            old technology from the old CytRx.

      -     Assist Investor Relations Department, analysts, etc. with regard to
            any press releases and information that has to be distributed to the
            public of a scientific nature.

      -     Prepare and keep current a matrix of all CytRx licenses and patents.

      -     Working with Director of Corporate Development on doing
            due-diligence on any in-licensing, mergers and acquisitions and
            strategic alliance opportunities.

      -     Assisting the CEO with any strategic alliance opportunities in the
            obesity and diabetes area.

      -     As part of the above, doing the necessary budgets and timelines for
            moving products through the clinic and developing drugs to go to
            market.

      -     In the event we are successful in closing the Biorex financing,
            taking over responsibilities for getting that drug in the clinic,
            including filing with the FDA for a phase II clinical trial, doing
            any work prior to the filing, including possible pre-filing meetings
            with the FDA. Working with the former employees of Biorex to make
            sure we have complete data packages that we need and inventory, etc.

      -     Be CytRx liaison with the FDA, NIH and any other regulatory
            organizations.

      -     Speaking at various scientific and business conferences and
            assisting the CEO and/or other members of the senior management team
            on road shows and due-diligence meetings to advance the companies
            stock performance.

      -     Attend meetings to discuss strategy as a member of the management
            team which includes Corporate Vice-President, Director of Business
            Development, Corporate Counsel, CFO, and CEO.

                                     S1 - 2
<PAGE>

      -     Other duties as Board of Directors, management team and outside
            agencies may require.

                                     S1 - 3
<PAGE>

                                   Schedule 2

                  Summary of Group Plans and Employee Benefits

      1. See CytRx Corporation Employee Handbook, dated July 15, 2004, which is
incorporated herein by reference.

                                     S2 - 1

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