EXHIBIT 10.1
EMPLOYMENT AGREEMENT
This Employment Agreement (this “
Agreement ”) is made and entered into as of
May 4, 2009 (the “ Effective Date ”) by and
between CytRx Corporation, a Delaware corporation (“
Employer ”), and Jaisim Shah, an individual and
resident of the State of California (“
Employee ”).
WHEREAS, Employer desires to employ Employee,
and Employee is willing to be employed by Employer, on the terms
set forth in this Agreement.
NOW, THEREFORE, upon the above premises, and in
consideration of the mutual covenants and agreements hereinafter
contained, the parties hereto agree as follows.
1.
Employment . Effective as of the Effective Date,
Employer shall employ Employee, and Employee shall serve, as
Employer’s Chief Business Officer and Senior Vice
President-Business 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 President and Chief Executive
Officer. Employee understands and agrees that his
duties, title and authority may be changed from time to time in the
discretion of Employer’s President and Chief Executive
Officer. Subject to the next succeeding sentence,
Employee’s services hereunder shall be rendered at
Employer’s corporate offices in Los Angeles, California,
except for travel when and as required in the performance of
Employee’s duties hereunder. Employee generally
shall be required to be physically present, and to perform his
services hereunder, at Employee’s corporate headquarters not
less than five consecutive business days per
month. Employee and Employer shall consult with each
other from time to time regarding the optimal scheduling of
Employee’s time at Employer’s corporate
offices. Except as provided above, Employee may work
remotely from his residence. When not present at
Employer’s corporate offices, Employee shall make himself
readily accessible to Employer by telephone, via the Internet or
other remote access, as Employer deems reasonably necessary for the
performance of Employee’s services
hereunder. Employer shall make available to Employee
remote computer access to Employer’s computerized
systems.
3.
Time and Efforts . Employee shall devote all of
his business time, efforts, attention and energies to
Employer’s business and to discharge his duties hereunder,
except that he shall be permitted to continue to serve on the board
of directors of up to two (2) other companies for whom he currently
serves as of the date of this Agreement; provided that such
position(s) do not pose any direct conflict of interest and that he
does not spend more than 5% of his business time serving on those
boards.
4.
Term . The term (the “ Term ”)
of Employee’s employment hereunder shall commence on the
Effective Date and shall expire on December 31, 2010, unless
sooner
terminated in
accordance with Section 6. Neither Employer nor Employee
shall have any obligation to extend or renew this Agreement, except
that Employer agrees to provide notice of non-renewal no later than
December 1, 2010. In the event that Employer does not
offer to extend or renew the Agreement, Employer shall continue to
pay Employee his salary as provided for in Section 5.1 during
the period commencing on the final date of the Term and ending on
(a) June 30, 2011 or (b) the date of
Employee’s re-employment with another employer, whichever is
earlier; provided that, as a condition to Employer’s
obligations under this sentence, Employee shall have executed and
delivered to Employer a Separation Agreement and General Release
in the form attached hereto as Exhibit A
. Employee shall notify Employer immediately in the
event Employee accepts such employment with another
employer.
5.
Compensation . As the total consideration for
Employee’s services rendered hereunder, Employer shall pay or
provide Employee the following compensation and
benefits:
5.1.
Salary . Employee shall be entitled to receive an
annual salary of Three Hundred Thousand Dollars ($300,000), payable
in accordance with Employer’s normal payroll policies and
procedures.
5.2.
Performance Bonus . Employee shall be entitled to
a performance bonus from time to time in an amount equal to one
percent (1%) of all up-front monies received by Employer pursuant
to each strategic partnership, sale of assets and out-license
arrangement consummated by Employer during the Term, or within six
months thereafter, in which Employee was significantly involved on
Employer’s behalf. Such performance bonus shall be
payable by Employer within thirty (30) days following
Employer’s receipt of such monies. For clarity,
Employer’s obligations under this Section 5.2 are
conditioned upon its actual receipt of monies pursuant to such a
transaction. No bonus shall be paid with respect to any
milestone payments, royalty payments, expense sharing or expense
advancements received by Employer. Notwithstanding
anything to the contrary herein, Employer’s obligations under
this Section 5.2 shall not apply to financing transactions
involving the sale of Employer’s securities, or any sale of
all or substantially all of Employer’s assets. Any
bonus payable hereunder shall be reduced by any amounts paid by
Employer for third party investment banking services for the
respective transaction.
5.3.
Discretionary Bonus . Employee also may be
eligible for a bonus from time to time for his services during the
Term. Employee’s eligibility to receive a bonus,
any determination to award Employee such a bonus and, if awarded,
the amount thereof, shall be in Employer’s sole
discretion. For 2009, any discretionary bonus shall not
be prorated, and instead shall be commensurate to a full year of
service.
5.4.
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 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
Effective Date and continuing on each succeeding
monthly
anniversary of the Effective Date until the Option shall have
become fully vested, provided, in each case, that Employee remains
in the continuous employ of Employer through such anniversary
dates. The Option shall (a) be exercisable at an
exercise price equal to $0.41 per share, (b) have a term of ten
years, and (c) be on such other terms as shall be determined by
Employer’s Board of Directors (or the Compensation Committee
of the Board) and set forth in a customary form of stock option
agreement under the Plan evidencing the
Option. Notwithstanding anything to the contrary in
Section 6.2 or other provision of this Agreement or of the
stock option agreement evidencing the Option, upon the occurrence
of a “Change in Control” (as defined in the Plan), the
Option shall thereupon vest and become exercisable as to all of the
shares covered thereby in accordance with the terms of the
Plan.
5.5.
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. When Employee
travels to Employer’s corporate offices, Employer shall pay
for reasonable lodging and transportation (including flights), but
shall not pay for food or other incidentals.
5.6.
Vacation . Employee shall be entitled to twenty
business days of vacation each year during the Term
in accordance with
