UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
Current Report
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Earliest Event Reported): June 16, 2006
CYTRX CORPORATION
(Exact Name of Registrant as Specified in its Charter)
Delaware
(State or Other Jurisdiction of Incorporation)
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000-15327
(Commission File Number)
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58-1642740
(I.R.S. Employer Identification No.) |
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11726 San Vicente Boulevard, Suite 650
Los Angeles, California
(Address of Principal Executive Offices)
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90049
(Zip Code) |
(310) 826-5648
(Registrant’s Telephone Number, Including Area Code)
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Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the
filing obligation of the Registrant under any of the following provisions: |
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¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
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¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b)) |
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¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c)) |
ITEM 1.01 Entry into a Material Definitive Agreement.
Executive Compensation
Determinations Under Employment Agreement with Steven Kriegsman
Mr. Kriegsman is employed as the Chief Executive Officer of CytRx Corporation pursuant to an
employment agreement that was amended and restated as of May 17, 2005 to continue through July 1,
2008. Under his employment agreement, Mr. Kriegsman is entitled to a current annual base salary of
$400,000, which is subject to our annual review. Mr. Kriegsman’s employment agreement additionally
provides that he is eligible to receive an annual bonus as determined by us in our sole discretion,
but not to be less than $150,000.
On June 16, 2006, our Compensation Committee completed its annual review of Mr. Kriegsman’s
compensation, and we increased his annual base salary to $435,000, effective July 1, 2006, and
granted Mr. Kriegsman a bonus of $200,000. In connection with the annual review, we also granted
Mr. Kriegsman on June 16, 2006 a ten-year, nonqualified option to purchase 200,000 shares of our
common stock at a price of $1.38 per share, which equaled the closing market price of our common
stock on that date. This option will vest monthly over three years, provided that Mr. Kriegsman
remains in our continuous employ through such monthly vesting periods.
Amended Employment Agreement with Jack Barber
On June 16, 2006, we agreed with Jack R. Barber, Ph.D., our Senior Vice President — Drug
Development, to enter into a second amended and restated employment agreement dated as of June 16,
2006 to continue Dr. Barber’s employment in that capacity through December 31, 2007. Under his
amended employment agreement, Dr. Barber is entitled to an annual base salary of $275,000,
effective as of July 1, 2006, up from $250,000 previously. We agreed to review Dr. Barber’s base
salary periodically, and may increase (but not decrease) it in our sole discretion, and Dr. Barber
is eligible to receive a bonus as determined by us in our sole discretion. On June 16, 2006, we
awarded Dr. Barber a bonus of $68,750 for the 2005-2006 contract year. In connection with entering
into his amended employment agreement, on June 16, 2006 we also granted Dr. Barber a ten-year,
nonqualified option to purchase 100,000 shares of our common stock at a price of $1.38 per share,
which equaled the closing market price of our common stock on that date. This option will vest
monthly over three years, provided that Dr. Barber remains in our continuous employ through such
monthly vesting periods. In the event we terminate Dr. Barber’s employment without “cause” (as
defined in his employment agreement), we have agreed to pay him a lump-sum severance amount equal
to three months’ salary under his employment agreement.
Amended Employment Agreement with Matthew Natalizio
On June 16, 2006, we agreed with Matthew Natalizio, our Chief Financial Officer, to enter into
a second amended and restated employment agreement dated as of June 16, 2006, to continue Mr.
Natalizio’s employment in that capacity through December 31, 2007. Under his amended employment
agreement, Mr. Natalizio is entitled to an annual base salary of $215,000, effective July 1, 2006,
up from $195,000 previously. We agreed to review the base salary periodically, and may increase
(but not decrease) it in our sole discretion, and Mr. Natalizio is eligible to receive a bonus as
determined by us in our sole discretion. On June 16, 2006, we awarded Mr. Natalizio a bonus of
$43,000 for the 2005-2006 contract year. In connection with entering into his amended employment
agreement, on June 16, 2006 we also granted Mr. Natalizio a ten-year, nonqualified option to
purchase 50,000 shares of our common stock at a price of $1.38 per share, which equaled the closing
market price of our common stock on that date. This option will vest monthly over three years,
provided that Mr. Natalizio remains in our continuous
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employ through such monthly vesting periods. In the event we terminate Mr. Natalizio’s
employment without “cause” (as defined in his employment agreement), we have agreed to pay him a
lump-sum severance amount equal three months’ salary under his employment agreement.
Amended Employment Agreement with Benjamin Levin
On June 16, 2006, we agreed with Benjamin S. Levin, our Vice President — Legal Affairs,
General Counsel and Secretary, to enter into a second amended and restated employment agreement
dated as of June 16, 2006 to continue Mr. Levin’s employment in that capacity through December 31,
2007. Under his amended employment agreement, Mr. Levin is entitled to an annual base salary of
$220,000, effective as of July 1, 2006, up from $195,000 previously. We agreed to review the base
salary periodically, and may increase (but not decrease) it in our sole discretion, and Mr. Levin
is eligible to receive a bonus as determined by us in our sole discretion. On June 16, 2006, we
awarded Mr. Levin a bonus of $68,750 for the 2005-2006 contract year. In connection with entering
into his amended employment agreement, on June 16, 2006 we also granted Mr. Levin a ten-year,
nonqualified option to purchase 90,000 shares of our common stock at a price of $1.38 per share,
which equaled the closing market price of our common stock on that date. This option will vest
monthly over three years, provided that Mr. Levin remains in our continuous employ through such
monthly vesting periods. In the event we terminate Mr. Levin’s employment without “cause” (as
defined in his employment agreement), we have agreed to pay him a lump-sum severance amount equal
to six months’ salary under his employment agreement.
Non-Employee Director Compensation
On June 20, 2006, our Board of Directors approved a revised schedule of cash compensation to
be paid to our non-employee directors for the ensuing twelve months and unless and until changed.
Effective from June 20, 2006, our non-employee directors each will receive a quarterly retainer of
$2,500 ($8,500 for the Chairman of the Board and $7,500 for the Chairman of the Audit Committee), a
fee of $2,000 for each Board meeting attended ($750 for meetings attended by teleconference and for
Board actions taken by unanimous written consent) and $1,000 for each committee meeting attended.
Non-employee directors who serve as the Chairman of a Board committee receive an additional $1,500
for each meeting of the Nomination and Governance Committee or the Compensation Committee attended
and an additional $2,000 for each meeting attended of the Audit Committee.
Our non-employee directors also are eligible to be awarded stock options for their services as
directors. On June 20, 2006, our Board of Directors approved an annual grant to our non-employee
directors of ten-year nonqualified stock options to purchase 25,000 shares of our common stock, up
from 15,000 shares currently. The stock option grants will be made as of our annual stockholders
meeting each year at an exercise price equal to the market price of our common stock at that time.
The options will vest immediately upon grant.
Directors who also serve as officers do not receive any additional compensation for their
services as directors.
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