UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

~~For the quarterly period ended~~ ~~September 30,~~ ~~2021~~


	For the quarterly period ended June 30, 2022
	OR

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

	For the transition period from to

~~For the transition period from ____________to____________~~

Commission file number ~~0-15327~~000-15327

CytRx Corporation

(Exact name of Registrant as specified in its charter)

Delaware

58-1642740

(State or other jurisdiction

of incorporation or organization)

(I.R.S. Employer

Identification No.)

11726 San Vicente Blvd., Suite 650

Los Angeles, CA

90049

(Address of principal executive offices)

(Zip Code)

(~~310~~(310)) 826-5648

(Registrant’s telephone number, including area code)

N/A

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
~~Common Stock, par value $0.001 per share~~None	~~CYTR~~None	~~OTC Market~~None
~~Series B Junior Participating Preferred Stock Purchase Rights~~

Indicate by check mark whether the ~~registrant:~~registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically ~~and posted on its corporate Web site, if any,~~ every Interactive Data File required to be submitted ~~and posted~~ pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit ~~and post~~ such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated ~~filer”~~filer,” “smaller reporting company,” and ~~“smaller reporting~~“emerging growth company” in Rule 12b-2 of the Exchange Act. ~~(Check one):~~

Large accelerated filer ☐	Accelerated filer ☐	Non-accelerated filer ☒	Smaller reporting company ☒
Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the Registrant is a shell company (as defined in Rule ~~12(b)-2~~12b-2 of the Exchange Act). Yes ☐ No ☒

Number of shares of CytRx Corporation common stock, $0.001 par value, outstanding as of ~~November 10, 2021:~~August 11, 2022: ~~38,780,038~~45,037,391

shares.

CYTRX CORPORATION

FORM 10-Q

TABLE OF CONTENTS

		Page
PART I. — FINANCIAL INFORMATION
Item 1.	Condensed Consolidated Financial Statements (unaudited)	4
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	1618
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	2123
Item 4.	Controls and Procedures	2124

PART II. — OTHER INFORMATION
Item 1.	Legal Proceedings	2224
Item 1A	Risk Factors	2224
Item 2	Unregistered Sales of Equity Securities and Use of Proceeds	2124
Item 3.	Defaults Upon Senior Securities	24
Item 4 .	Mine Safety Disclosures	24
Item 5.	Other Information	24
Item 6.	Exhibits	2224

SIGNATURES		2325

INDEX TO EXHIBITS		2426

Forward Looking Statements

All statements in this Quarterly Report, including statements in this section, other than statements of historical fact are forward-looking statements, including statements of our current views with respect to the recent developments regarding our business strategy, business plan and research and development activities, our future financial results, and other future events. These statements include forward-looking statements both with respect to us, specifically, and the biotechnology industry, in general. In some cases, forward-looking statements can be identified by the use of terminology such as “may,” “will,” “expects,” “plans,” “anticipates,” “estimates,” “potential” or “could” or the negative thereof or other comparable terminology. Although we believe that the expectations reflected in the forward-looking statements contained herein are reasonable, there can be no assurance that such expectations or any of the forward-looking statements will prove to be correct, and actual results could differ materially from those projected or assumed in the forward-looking statements.

All forward-looking statements involve inherent risks and uncertainties, and there are or will be important factors that could cause actual results to differ materially from those indicated in these statements. We believe that these factors include, but are not limited to, the factors discussed in this section and under the caption “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, ~~2020,~~2021, which should be reviewed carefully. If one or more of these or other risks or uncertainties materialize, or if our underlying assumptions prove to be incorrect, actual results may vary materially from what we anticipate. Please consider our forward-looking statements in light of those risks as you read this Quarterly Report. We undertake no obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise.

Note Regarding Company References

References throughout this Quarterly Report on Form 10-Q, the “Company”, “CytRx”, “we”, “us”, and “our”, except where the context requires otherwise, refer to CytRx Corporation and its subsidiary.

PART I — FINANCIAL INFORMATION

Item 1. — Consolidated Financial Statements

CYTRX CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS


	September 30, 2021			December 31, 2020			June 30, 2022			December 31, 2021
	(Unaudited)						(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	16,458,053		$	10,003,375		$	4,111,845		$	6,769,603
Insurance claim receivable		1,075			325,105			100,000			200,000
Prepaid expenses and other current assets		87,523			1,094,675			479,054			1,310,382
Total current assets		16,546,651			11,423,155			4,690,899			8,279,985
Equipment and furnishings, net		29,927			39,758			26,061			32,784
Other assets		16,836			16,836			7,703			16,836
Operating lease right-of-use assets		443,617			580,478			306,871			397,172
Total assets	$	17,037,031		$	12,060,227		$	5,031,534		$	8,726,777
LIABILITIES AND STOCKHOLDERS’ EQUITY

Current liabilities:
Accounts payable	$	1,167,945		$	1,402,054		$	1,210,369		$	1,470,652
Accrued expenses and other current liabilities		1,433,334			1,190,910			1,214,563			2,064,506
Current portion of operating lease liabilities		184,761			181,103			132,940			198,819
Total current liabilities		2,786,040			2,774,067			2,557,872			3,733,977

Operating lease liabilities, net of current portion		276,593			415,200			189,390			216,381

Total liabilities		3,062,633			3,189,267
Preferred Stock, Series C 10% Convertible, $1,000 par value, 2,752 and 8,240 shares issued and outstanding at June 30, 2022 and December 31, 2021, respectively								1,343,684			4,022,700

Preferred Stock, Series C 10% Convertible, $1,000 par value, 8,240 shares issued and outstanding		4,022,700			—
Commitments and contingencies								-

Stockholders’ equity:
Preferred Stock, $0.01 par value, 833,333 shares authorized, including 50,000 shares of Series B Junior Participating Preferred Stock; 0 shares issued and outstanding		—			—			—			—
Common stock, $0.001 par value, 41,666,666 shares authorized; 38,780,038 shares issued and outstanding at September 30, 2021 and 36,480,038 shares issued and outstanding at December 31, 2020		38,780			36,480
Common stock, $0.001 par value, 62,393,940 shares authorized; 45,037,391 and 38,780,038 shares issued and outstanding at June 30, 2022 and December 31, 2021, respectively								45,037			38,780
Additional paid-in capital		484,790,650			479,561,860			487,469,516			484,790,650
Accumulated deficit		(474,877,732	)		(470,727,380	)		(486,573,965	)		(484,075,711	)
Total stockholders’ equity		9,951,698			8,870,960			940,588			753,719
Total liabilities and stockholders’ equity	$	17,037,031		$	12,060,227		$	5,031,534		$	8,726,777

The accompanying notes are an integral part of these condensed consolidated financial statements.

CYTRX CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)


	Three Months Ended September 30,						Nine Months Ended September 30,						Three Months Ended June 30,						Six Months Ended June 30,
	2021			2020			2021			2020			2022			2021			2022			2021
Revenue:
Licensing revenue	$	—		$	—		$	—		$	—		$	—		$	—		$	—		$	—

Expenses:
Research and development		—			592,768			—			819,950
General and administrative		1,532,613			2,207,874			3,993,672			4,586,422			1,148,037			1,181,211			2,442,754			2,461,059
Total Expenses		1,532,613			2,800,642			3,993,672			5,406,372

Loss from operations		(1,532,613	)		(2,800,342	)		(3,993,672	)		(5,406,372	)		(1,148,037	)		(1,181,211	)		(2,442,754	)		(2,461,059	)

Other income (loss):
Liquidated damages expense		(164,800	)		—			(164,800	)		—
Interest income		4,383			21,302			13,365			112,016			1,002			4,146			1,855			8,982
Forgiveness of accounts payable														353,565			—			353,565			—
Other income (loss), net		(2,223	)		4,782			(5,245	)		5,522			(306	)		1,269			(2,353	)		(3,022	)

Net loss	$	(1,695,253	)	$	(2,774,558	)	$	(4,150,352	)	$	(5,288,834	)	$	(793,776	)	$	(1,175,796	)	$	(2,089,687	)	$	(2,455,099	)

Dividends paid on preferred shares														(202,567	)		—			(408,567	)		—

Net loss attributable to common stockholders													$	(996,343	)	$	(1,175,796	)	$	(2,498,254	)	$	(2,455,099	)

Total basic and diluted loss per share	$	(0.04	)	$	(0.08	)	$	(0.11	)	$	(0.16	)	$	(0.02	)	$	(0.03	)	$	(0.06	)	$	(0.07	)

Basic and diluted weighted-average shares outstanding		38,472,346			35,195,082			37,069,376			34,070,562			44,320,100			36,549,269			41,679,126			36,515,038

The accompanying notes are an integral part of these condensed consolidated financial statements

CYTRX CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)


	Nine Months Ended September 30,						Six Months Ended June 30,
	2021			2020			2022			2021
Cash flows from operating activities:
Net loss from operations	$	(4,150,352	)	$	(5,288,834	)	$	(2,089,687	)	$	(2,455,099	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization		9,831			21,524			7,490			6,587
Stock-based compensation expense		—			260,598			6,104			—
Changes in assets and liabilities:
Insurance claim receivable		324,030			7,628			100,000			325,105
Prepaid expenses and other current assets		1,007,152			(464,063	)		831,328			768,352
Other assets		—			(9,246	)		9,133			—
Amortization of right-of-use asset		136,861			156,279			90,301			90,833
Accounts payable		(234,109	)		1,634,946			(260,285	)		(439,056	)
Decrease in lease liabilities		(134,949	)		(145,609	)		(92,870	)		(89,211	)
Accrued expenses and other current liabilities		242,424			285,145			(849,939	)		145,950
Net cash used in operating activities		(2,799,112	)		(3,541,631	)		(2,248,425	)		(1,646,539	)

Cash flows from investing activities:
Purchase of fixed assets		—			(25,902	)		(766	)		—
Net cash used in investing activities		—			(25,902	)		(766	)		—

Cash flows from financing activities
Net proceeds from issuance of common stock and investment option		5,153,090			—
Net proceeds from issuance of preferred stock		4,022,700			—
Preferred stock dividend								(408,567	)		—
Proceeds from exercise of stock options		78,000			39,000			—			78,000
Net cash from financing activities		9,253,790			39,000
Net cash provided by (used in) financing activities								(408,567			78,000

Net increase (decrease) in cash and cash equivalents		6,454,678			(3,528,532	)
Net decrease in cash and cash equivalents								(2,657,758	)		(1,568,539	)
Cash and cash equivalents at beginning of period		10,003,375			16,130,410			6,769,603			10,003,375
Cash and cash equivalents at end of period	$	16,458,053		$	12,601,878		$	4,111,845		$	8,434,836

Supplemental disclosure of Cash Flow Information:
Recognition of operating lease right-of-use assets and obligations under ASC Topic 842	$	—		$	715,310

Reclassification of right-of-use asset, from prepaid expenses	$	—		$	66,271

Insurance claims to offset accounts payable	$	—		$	613,905
Conversion of Series C Preferred Stock to Common Stock							$	2,679,019		$	—

The accompanying notes are an integral part of these condensed consolidated financial statements

CYTRX CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(Unaudited)

~~For the Three and Nine-Month Periods Ended September 30, 2021~~

Common Shares Issued Common Stock Amount
Additional
Paid-in
Capital
Accumulated Deficit Total
Balance at January 1, 2021 36,480,038 $ 36,480 $ 479,561,860 $ (470,727,380 ) $ 8,870,960
Exercise of stock options
Exercise of stock options, shares
Issuance of common stock and preferred investment option
Issuance of common stock and preferred investment option, shares
Issuance of stock options/warrants for compensation and services -
Issuance of stock options/restricted stock for compensation and services -
Net loss - - (1,279,303 ) (1,279,303 )
Balance at March 31, 2021 36,480,038 36,480 479,561,860 (472,006,683 ) 7,591,657

Exercise of stock options 300,000 300 77,700
—
78,000
Net loss - (1,175,796 ) (1,175,796 )

Balance at June 30, 2021 36,780,038 $ 36,780 $ 479,639,560 $ (473,182,479 ) $ 6,493,861

Issuance of common stock and preferred investment option 2,000,000 2,000 5,151,090 5,153,090
Net loss - (1,695,253 ) (1,695,253 )

Balance at September 30, 2021 38,780,038 $ 38,780 $ 484,790,650 $ (474,877,732 ) $ 9,951,698

~~For the Three and Nine-Month Periods Ended September 30, 2020~~

Balance at January 1, 2020 33,637,501 $ 33,637 $ 479,197,849 $ (464,026,774 ) $ 15,204,712
Issuance of stock options/warrants for compensation and services — — 86,662 — 86,662
Net loss - (1,172,786 ) (1,172,786 )
Balance at March 31, 2020 33,637,501 $ 33,637 $ 479,284,511 $ (465,199,560 ) $ 14,118,588
Issuance of stock options/restricted stock for compensation and services 86,659 86,659
Net loss - (1,341,490 ) (1,341,490 )
Balance at June 30, 2020 33,637,501 $ 33,637 $ 479,371,170 $ (466,541,050 ) $ 12,863,757

Exercise of stock options 2,842,537 2,843 36,157 39,000
Issuance of stock options/restricted stock for compensation and services 87,277 87,277
Net loss - (2,774,558 ) (2,774,558 )

Balance at September 30, 2020 36,480,038 $ 36,480 $ 479,494,604 $ (469,315,606 ) $ 10,215,478
Ending balance, value 36,480,038 $ 36,480 $ 479,494,604 $ (469,315,606 ) $ 10,215,478


	For the Six Month Period Ended June 30, 2022
	Series B Preferred Shares Issued		Common Shares Issued		Common Stock Amount		Additional Paid-in Capital			Accumulated Deficit			Total
Balance at January 1, 2022		—		38,780,038	$	38,780	$	484,790,650		$	(484,075,711	)	$	753,719
Exercise of stock options				21,404		21		(21	)					—
Conversion of preferred shares				4,681,819		4,682		2,006,609						2,011,351
Preferred dividend											(206,000	)		(206,000	)
Issuance of restricted stock for compensation								3,299						3,299
Net loss		-									(1,295,911	)		(1,295,911	)
Balance at March 31, 2022		—		43,483,261	$	43,483	$	486,800,597		$	(485,577,622	)	$	1,266,458

Conversion of preferred shares				1,554,130		1,554		666,114						667,668
Issuance of restricted stock for compensation								2,805						2,805
Preferred dividend											(202,567	)		(202,567	)
Net loss		-									(793,776	)		(793,776	)
Balance at June 30, 2022		-		45,037,391	$	45,037	$	487,469,516		$	(486,573,965	)	$	940,588

~~The accompanying notes are an integral part of these condensed consolidated financial statements.~~

	For the Six Month Period Ended June 30, 2021
	Series B Preferred Shares Issued		Common Shares Issued		Common Stock Amount		Additional Paid-in Capital		Accumulated Deficit			Total

Balance at January 1, 2021		—		36,480,038	$	36,480	$	479,561,860	$	(470,727,380	)	$	8,870,960
Net loss		-		-		-		-		(1,279,303	)		(1,279,303	)
Balance at March 31, 2021		—		36,480,038	$	36,480	$	479,561,860	($	472,006,683	)	$	7,591,657

Exercise of stock options		—		300,000		300		77,700		—			78,000
Net loss		-								(1,175,796	)		(1,175,796	)
Balance at June 30, 2021		—		36,780,038	$	36,780	$	479,639,560	$	(473,182,479	)	$	6,493,861

CYTRX CORPORATION

NOTES TO CONDENSED ~~CONSOLIDATED~~ FINANCIAL STATEMENTS

For the ~~Nine-Months~~Six-Months Period Ended ~~September~~June 30, ~~2021~~2022 and ~~2020~~2021
(Unaudited)

1.Basis of Presentation and Significant Accounting Policies

Basis of Presentation and Principles of Consolidation

The accompanying condensed consolidated financial statements at ~~September~~June 30, ~~2021~~2022 and for the three-month and ~~nine-month~~six-month periods ended ~~September~~June 30, ~~2021~~2022 and ~~2020,~~2021, respectively, are unaudited, but include all adjustments, consisting of normal recurring entries, that management believes to be necessary for a fair presentation of the periods presented. Interim results are not necessarily indicative of results for a full year. Balance sheet amounts as of December 31, ~~2020~~2021 have been derived from our audited financial statements as of that date.

The consolidated financial statements included herein have been prepared by us pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted pursuant to such rules and regulations. The consolidated financial statements should be read in conjunction with our audited financial statements contained in its Annual Report on Form 10-K for the year ended December 31, ~~2020 (as amended, the “2020~~2021 (the “2021 Annual Report”).

~~Liquidity and Capital Resources~~Going Concern

The Company’s condensed consolidated financial statements have been presented on the basis that it will continue as a going concern, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. During the six months ended June 30, 2022, the Company incurred a net loss of $2,089,687, utilized cash in operations of $2,248,425, and had an accumulated deficit of $486,573,965 as of June 30, 2022. In addition, the Company has no recurring revenue. As a result, management has concluded that there is substantial doubt about the Company’s ability to continue as a going concern. The Company’s consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. The Company’s independent registered public accounting firm, in its report on the Company’s consolidated financial statements for the year ended December 31, 2021, has also expressed substantial doubt about the Company’s ability to continue as a going concern.

At ~~September~~June 30, ~~2021,~~2022, we had cash and cash equivalents and short-term investments of approximately $~~16.5~~ 4.1million. ~~Management believes~~We believe we have sufficient cash to fund operations through March 2023. The continuation of the Company as a going concern is dependent upon its ability to obtain necessary debt or equity financing to continue operations until it begins generating positive cash flow. No assurance can be given that ~~our current cash and cash equivalents and short-term investments~~any future financing will be sufficient to fund the Company’s operations for the foreseeable future. This estimate is based, in part, upon our currently projected expenditures for the remainder of 2021 and the first ten months of 2022 of approximately $~~6.5~~ ~~million (unaudited) to fund operating activities. These projected expenditures exclude any payments related to liquidated damages~~available or, ~~dividends to~~if available, that it will be ~~paid~~ on ~~the Preferred Stock (as defined herein). The Company will continue to accrue dividend and liquidated damages payments totaling $0.7~~ ~~million on a quarterly basis until shareholders approve an increase~~terms that are satisfactory to the Company’s authorized shares of common stock (see Note 2). These projected expenditures and payments are also based upon numerous other assumptions and subject to many uncertainties, and our actual expenditures may be significantly different from these projections.

~~While these projections represent the Company’s current expected expenditures,~~Company. Even if the Company ~~has the ability to reduce the amounts as needed to manage its liquidity needs while still advancing its corporate objectives. The Company will ultimately be required~~is able to obtain additional funding in order to execute its long-term business plans, although it does not currently have commitments from any third parties to provide the Company with long term debt, capital or non-dilutive up-front payments from a potential strategic partner. The Company cannot assure that additional funding will be available on favorable terms, or at all. If the Company fails to obtain additional funding when needed,financing, it may ~~not be able to execute its business plans and its business may suffer, which would have a material adverse effect~~contain undue restrictions on ~~its financial position, results~~our operations, in the case of ~~operations and cash flows.~~debt financing or cause substantial dilution for our stockholders, in case or equity financing.

Use of Estimates

Preparation of the Company’s consolidated financial statements in conformance with U.S. GAAP requires the Company’s management to make estimates and assumptions that impact the reported amounts of assets, liabilities, revenues and expenses, and the disclosure of contingent assets and liabilities in the Company’s consolidated financial statements and accompanying notes. The significant estimates in the Company’s consolidated financial statements relate to the valuation of equity awards, recoverability of deferred tax assets, and estimated useful lives of fixed assets, The Company bases estimates and assumptions on historical experience, when available, and on various factors that it believes to be reasonable under the circumstances. The Company evaluates its estimates and assumptions on an ongoing basis, and its actual results may differ from estimates made under different assumptions or conditions.

Stock Compensation

The Company accounts for share-based awards to employees and nonemployees directors and consultants in accordance with the provisions of ASC 718, Compensation—Stock Compensation., and under the recently issued guidance following FASB’s pronouncement, ASU 2018-07, Compensation—Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting. Under ASC 718, and applicable updates adopted, share-based awards are valued at fair value on the date of grant and that fair value is recognized over the requisite service, or vesting, period. The Company values its equity awards using the Black-Scholes option pricing model, and accounts for forfeitures when they occur.

Foreign Currency Remeasurement

The U.S. dollar has been determined to be the functional currency for the net assets of our German operations. The transactions are recorded in the local currencies and are remeasured at each reporting date using the historical rates for nonmonetary assets and liabilities and current exchange rates for monetary assets and liabilities at the balance sheet date. Exchange gains and losses from the remeasurement of monetary assets and liabilities are recognized in other income (loss). The Company recognized a ~~(loss)~~loss of approximately $~~(7,400)~~(10,900) and $~~($9,500)~~(16,200), respectively, for the three-month and ~~nine-month~~six-month periods ended ~~September~~June 30, ~~2021~~2022 and a gain (loss) of approximately $~~13,300~~3,500 and $~~100~~(9,500), respectively, for the three and ~~nine-month~~six-month periods ended ~~September~~June 30, ~~2020,~~2021, respectively.

Basic and Diluted Net Loss Per Common Share

Basic and diluted net loss per common share is computed based on the weighted-average number of common shares ~~outstanding.~~outstanding for the period. Diluted net income (loss) per share is computed by dividing the net income (loss) applicable to common stockholders by the weighted average number of common shares outstanding plus the number of additional common shares that would have been outstanding if all dilutive potential common shares had been issued using the treasury stock method. Potential common shares are excluded from the computation when their effect is antidilutive. Common share equivalents that could potentially dilute net loss per share in the future, and which were excluded from the computation of diluted loss per share, were as follows:

Schedule of Shares Excluded from Computation of Diluted Loss Per Share

	2021		2020		2022		2021
	As of September 30,				As of June 30,
	2021		2020		2022		2021

Options to acquire common stock		2,862,700		3,162,700		1,847,611		2,862,700
Warrants to acquire common stock		4,167		193,196		4,167		4,167
Convertible preferred stock		9,336,637		—
Series C Convertible preferred stock						3,127,688		—
Investment option		11,363,637		—		11,363,637		—
Shares excluded from computation of diluted loss per share		23,657,141		3,355,896
Shares excluded from computation of diluted loss per shares						16,343,103		2,866,867

Fair Value Measurements

Assets and liabilities recorded at fair value on the balance sheets are categorized based upon the level of judgment associated with the inputs used to measure the fair value. Level inputs are as follows:

Level 1 – quoted prices in active markets for identical assets or liabilities.

Level 2 – other significant observable inputs for the assets or liabilities through corroboration with market data at the measurement date.

Level 3 – significant unobservable inputs that reflect management’s best estimate of what market participants would use to price the assets or liabilities at the measurement date.

We consider carrying amounts of accounts receivable, accounts payable and accrued expenses to approximate fair value due to the short-term nature of these financial instruments. Our non-financial assets are measured at fair value when there is an indicator of impairment and recorded at fair value only when an impairment charge is recognized.

Recently Issued Accounting Pronouncements

In June 2016, the FASB issued ASU No. 2016-13, Credit Losses - Measurement of Credit Losses on Financial Instruments (“ASC 326”). The standard significantly changes how entities will measure credit losses for most financial assets, including accounts and notes receivables. The standard will replace today’s “incurred loss” approach with an “expected loss” model, under which companies will recognize allowances based on expected rather than incurred losses. Entities will apply the standard’s provisions as a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is effective. The standard is effective for interim and annual reporting periods beginning after December 15, ~~2019.~~2022. The adoption of ASU 2016-13 is not expected to have a material impact on the Company’s financial position, results of operations, and cash flows.

In May 2021, the FASB issued ASU 2021-04, Earnings Per Share (Topic 260), Debt — Modifications and Extinguishments (Subtopic 470-50), Compensation — Stock Compensation (Topic 718), and Derivatives and Hedging — Contracts in Entity’s Own Equity (Subtopic 815-40): Issuer’s Accounting for Certain Modifications or Exchanges of Freestanding Equity-Classified Written Call Options (“ASU 2021-04”). ASU 2021-04 provides guidance as to how an issuer should account for a modification of the terms or conditions or an exchange of a freestanding equity-classified written call option (i.e., a warrant) that remains classified after modification or exchange as an exchange of the original instrument for a new instrument. An issuer should measure the effect of a modification or exchange as the difference between the fair value of the modified or exchanged warrant and the fair value of that warrant immediately before modification or exchange and then apply a recognition model that comprises four categories of transactions and the corresponding accounting treatment for each category (equity issuance, debt origination, debt modification, and modifications unrelated to equity issuance and debt origination or modification). ASU 2021-04 is effective for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years. An entity should apply the guidance provided in ASU 2021-04 prospectively to modifications or exchanges occurring on or after the effective date. Early adoption is permitted, including adoption in an interim period. If an entity elects to early adopt ASU 2021-04 in an interim period, the guidance should be applied as of the beginning of the fiscal year that includes that interim period. The adoption of ASU 2021-04 did not have any impact on the Company’s consolidated financial statement presentation or disclosures.

Other recent authoritative guidance issued by the FASB (including technical corrections to the ASC), the American Institute of Certified Public Accountants, and the Securities and Exchange Commission (“SEC”) did not, or are not expected to, have a material impact on the Company’s consolidated financial statements and related disclosures.

2. Financing Under Security Purchase Agreement

On July 13, 2021, the Company entered into a Securities Purchase Agreement (the “Purchase Agreement”) with a single institutional investor (the “Investor”) for aggregate gross proceeds of $10million and net proceeds of approximately $9.2million. The transaction closed on July 16, 2021. Under the Purchase Agreement, the Company sold and issued (i) 2million shares of its common stock at a purchase price of $0.88per share for total gross proceeds of approximately $1.76million in a registered direct offering (the “Registered Direct Offering”) and (ii) 8,240shares of Series C 10.00% Convertible Preferred Stock (the “Preferred Stock”) at a purchase price of $1,000per share, for aggregate gross proceeds of approximately $8.24million, in a concurrent private placement (the “Private Placement” and, together with the Registered Direct Offering, the “July 2021 Offerings”). The shares of the Preferred Stock are convertible, upon shareholder approval as described below, into an aggregate of up to 9,363,637shares of common stock at a conversion price of $0.88per share. Holders of the Preferred Stock shall be entitled to receive, and the Company shall pay, cumulative dividends at the rate per share (as a percentage of the stated value per share) of ~~10.00~~%10.00% per annum, payable quarterly on January 1, April 1, July 1 and October 1, beginning on the first such date after the date of issuance. The terms of the Preferred Stock include beneficial ownership limitations that preclude conversion that would result in the Investor owning in excess of 9.99% of the Company’s outstanding shares of common stock. CytRx also issued to the Investor an unregistered preferred investment option (the “Preferred Investment Option”) that allows for the purchase of up to 11,363,637 shares of common stock for additional gross proceeds of approximately $10 million if the Preferred Investment Option is exercised in full. The exercise price for the Preferred Investment Option is $0.88 per share.The Preferred Investment Option has a term equal to five and one-half years commencing upon the Company increasing its authorized common stock following shareholder approval. The Company held a special meeting of stockholders on September 23, 2021 at which time the shareholders did not approve the proposal to increase the Company’s authorized common stock. The Company is committed to holding another meeting in the first quarter of 2022 to obtain approval for this increase in authorized common stock. In the meantime, the Company is liable for liquidated damages in the monthly amount of $~~164,800, with the first such payment having been made and expensed on September 29, 2021. On October 1, 2021, the Company paid a quarterly~~ 10~~% dividend to the Investor in the amount of $171,668~~.

The Company accounted for these transactions as a single transaction for accounting purposes and allocated total proceeds to the respective instruments based upon the relative fair value of each instrument. The Company determined that the relative fair value of (i) the2,000,000shares of the common stock issued was $859,218, (ii) the relative fair value of the 8,240shares of Preferred Stock was $4,022,700, and (iii) the relative fair value of the Preferred Investment Option was $4,293,872based upon a Black Scholes valuation model. As such, the Company recorded as Additional Paid in Capital the fair value of the common stock and Preferred Investment Option of $5,153,090, and the fair value of the Series C Preferred Stock was $4,022,700which ~~has been~~was reflected as mezzanine equity due to certain clauses of the Securities Purchase Agreement.

On October 1, 2021, the Company paid a quarterly 10% dividend to the Investor in the amount of $171,668; on January 1, 2022, the Company paid a quarterly dividend of $206,000 and on April 1, 2022, the Company paid a quarterly dividend of $202,567.

On March 15, 2022, at a special meeting of its stockholders which was originally opened and subsequently adjourned on September 23, 2021, the Company’s stockholders, by an affirmative vote of the majority of the Company’s outstanding shares of capital stock, approved the amendment to the Company’s Restated Certificate of Incorporation to effect an increase in the number of shares of authorized common stock, par value $0.001 per share, from 41,666,666 shares to 62,393,940 shares, and to make a corresponding change to the number of authorized shares of capital stock in order to comply with the Company’s contractual obligations under the Purchase Agreement.

On March 28, 2022, the Investor converted 4,120 shares of the Series C Preferred Stock in accordance with the initial terms of the agreement and received 4,681,819 common shares. On May 15, 2022, the Investor converted a further 1,368 shares of the Series C Preferred Stock and received 1,554,130 common shares.

Terms of Series C Preferred Stock

Under the Certificate of the Designations, Powers, Preferences and Rights of Series C 10.00% Convertible Preferred Stock (the “~~Certificate~~“Certificate of ~~Designations~~”Designations”), each share of Series C Preferred Stock will be convertible, subject to the Beneficial Ownership Limitation (as defined below), at either the holder’s option or at the Company’s option (a “~~Company~~“Company Initiated ~~Conversion~~”Conversion”) at any time following stockholder approval having been obtained to amend our restated certificate of incorporation to increase the number of authorized shares of common stock above 41,666,666 (the “Stockholder Approval”), into common stock at a conversion rate equal to the quotient of (i) the Series C Stated Value of $1,000 (the “~~Series~~“Series C Stated ~~Value~~”Value”) plus, in the case of a Company Initiated Conversion, all accrued and accumulated and unpaid dividends on such share of Series C Preferred Stock, divided by (ii) the initial conversion price of $0.88, subject to specified adjustments for stock splits, stock dividends, reclassifications or other similar events as set forth in the Certificate of Designations.

The Certificate of Designations contains limitations that prevent the holder thereof from acquiring shares of common stock upon conversion that would result in the number of shares of common stock beneficially owned by such holder and its affiliates exceeding 9.99% of the total number of shares of common stock outstanding immediately after giving effect to the conversion (the “~~Beneficial~~“Beneficial Ownership ~~Limitation~~”Limitation”), except that upon notice from the holder to the Company, the holder may increase or decrease the amount of ownership of outstanding shares of common stock after converting the holder’s shares of Series C Preferred Stock, provided that the Beneficial Ownership Limitation in no event exceeds 9.99% of the number of outstanding shares of the common stock outstanding immediately after giving effect to the issuance of shares of common stock upon conversion of the shares of Series C Preferred Stock held by the holder and provided that any increase in the Beneficial Ownership Limitation shall not be effective until 61 days following notice to the Company.

Each holder of shares of Preferred Stock is entitled to receive dividends, commencing from the date of issuance of the Preferred Stock. Such dividends may be paid only when, as and if declared by the Board of Directors of the Company (the “~~Board~~”“Board”), out of assets legally available therefore, quarterly in arrears on the first day of January, April, July and October in each year, commencing on the date of issuance, at the dividend rate of 10.00% per year. Such dividends are cumulative and continue to accrue on a daily basis whether or not declared and whether or not we have assets legally available therefore.

Under the Certificate of Designations, each share of Series C Preferred Stock carries a liquidation preference equal to the Series C Stated Value plus accrued and unpaid and accumulated dividends thereon. Such liquidation preference is payable upon certain change in control transactions and accordingly, this instrument is classified as mezzanine (temporary equity).

The holders of the Series C Preferred Stock may vote their shares of Preferred Stock on an as-converted basis, subject to the Beneficial Ownership Limitation (which Beneficial Ownership Limitation shall be calculated on a basis which includes the number of shares of common stock which are issuable upon conversion of the unconverted Series C Stated Value beneficially owned by a holder or any of its affiliates or attribution parties on all matters submitted to the holders of common stock for approval). The Company may not take the following actions without the prior consent of the holders of at least a majority of the Preferred Stock then outstanding: (a) alter or change adversely the powers, preferences or rights given to the Preferred Stock or alter or amend the Certificate of Designations, (b) authorize or create any class of stock ranking as to dividends, redemption or distribution of assets upon a Liquidation (as defined in the Certificate of Designations) senior to, or otherwise pari passu with, the Preferred Stock, (c) amend its Certificate of Incorporation or other charter documents in any manner that adversely affects any rights of the holders of the Preferred Stock, (d) increase the number of authorized shares of Preferred Stock, or (e) enter into any agreement with respect to any of the foregoing.

Terms of Preferred Investment Option

The Preferred Investment Option to purchase up to 11,363,637shares of common stock is exercisable at a price of $0.88per share. The Preferred Investment Option ~~have~~has a term of five and one-half years from the Authorized Share Increase Date. The holders of the Preferred Investment Option may exercise the Preferred Investment Option on a cashless basis, solely to the extent there is no effective registration statement registering, or the prospectus in such registration statement is not available for the resale of the shares of common stock issuable at the time of exercise. The Company is prohibited from effecting an exercise of any Preferred Investment Option to the extent that such exercise would result in the number of shares of common stock beneficially owned by such holder and its affiliates exceeding 9.99% of the total number of shares of common stock outstanding immediately after giving effect to the exercise of the Preferred Investment Options by the holder (the “~~PIO~~“PIO Beneficial Ownership ~~Limitation~~”Limitation”), except that upon notice from the holder to the Company, the holder may increase or decrease the amount of ownership of outstanding shares of Common Stock after exercising the holder’s Preferred Investment Option, provided that the PIO Beneficial Ownership Limitation in no event exceeds 9.99% of the number of outstanding shares of the Common Stock outstanding immediately after giving effect to the issuance of shares of common stock upon exercise of the Preferred Investment Option held by the holder and provided that any increase in the PIO Beneficial Ownership Limitation shall not be effective until 61 days following notice to the Company. The Preferred Investment Option provides for a Black-Scholes payout upon certain fundamental change transactions relating to the Company, as specified therein.

~~Until~~ If the ~~Authorized Share Increase Date,~~fundamental change transaction is within the control of the Company, ~~may not issue any shares~~the payout will be in cash. Otherwise, the payout will be in the same form of consideration received by the common ~~stock upon exercise~~stockholders as a result of ~~the Preferred Investment Option.~~this transaction.

Registration Rights Agreement

In connection with the July 2021 Offerings, the Company entered into a registration rights agreement, dated as of July 13, 2021 (the “Registration Rights Agreement”), with the investor named therein, pursuant to which the Company will undertake to file, within five calendar days of the date of the filing of the proxy statement seeking the Stockholder Approval, a resale registration statement to register the shares of common stock issuable upon: (i) the conversion of the Preferred Stock sold in the Private Placement and (ii) the exercise of the Preferred Investment Option (the “~~Registrable Securities~~”“Registrable Securities”); and to cause such registration statement to be declared effective under the Securities Act as promptly as possible after the filing thereof, but in any event no later than 75 days following the pricing date of this offering, or no later than 105 days following such date in the event of a “full review” by the SEC, and shall use its reasonable best efforts to keep such registration statement continuously effective under the Securities Act until the date that all Registrable Securities covered by such registration statement have been sold or are otherwise able to be sold pursuant to Rule 144. The Registration Rights Agreement provides for liquidated damages to the extent that the Company does not file or maintain a registration statement in accordance with the terms thereof. The registration rights agreement entered into between us and the Investor on July 13, 2021, contains a triggering event which would require us to pay to any holder of the Preferred Stock an amount in cash, as partial liquidated damages and not as a penalty, on a monthly basis equal to the product of 2.0% ~~multipled~~multiplied by the aggregate subscription amount paid by such holder for shares of Preferred Stock pursuant to the Purchase Agreement; provided, however, that such partial liquidated damages shall not exceed 24% of the aggregate subscription amounts paid by such holders pursuant to the Purchase Agreement, or $1,977,600. If we fail to pay any partial liquidated damages within seven days after the date payable, we will be required to pay interest on any such amounts at a rate equal to the lesser of 18% per annum or the maximum rate permitted by applicable law.

During the year ended December 31, 2021, the Company did not have enough shares of authorized common stock to issue the shares of common stock issuable upon the exercise or conversion of the Registrable Securities, as applicable. For the year ended December 31, 2021, the Company attempted, but was unsuccessful, to obtain its stockholders’ approval for the increase in its shares of authorized common stock at a special meeting that was originally opened and subsequently adjourned on September 23, 2021, and accordingly, the Company was unable to meet its registration rights obligation as of December 31, 2021. As such, the Company recognized an aggregate of approximately $1.1 million in liquidated damages during the year ended December 31, 2021, of which includes a provision of $615,123 as an accrual for estimated damages until stockholders’ approval is achieved and the registration statement registering the shares of common stock issuable upon the exercise or conversion, as applicable, of the Registrable Securities is filed. On March 15, 2022, the Company received its stockholders’ approval to increase its authorized shares and filed a certificate of amendment to its Certificate of Incorporation to increase the number of authorized shares from 41,666,666 shares to 63,227,273 shares on the same date. The Company filed its registration statement registering the shares underlying the Registrable Securities on March 23, 2022 and has provided for liquidated damages through that date. The registration statement was declared effective on March 28, 2022.

3.Series D Preferred Stock

On May 19, 2022, the Board declared a dividend of one one-thousandth of a share of Series D Preferred Stock, par value $0.01 per share (“Series D Preferred Stock”), for each outstanding share of Company’s Common Stock to stockholders of record at 5:00 p.m. Eastern Time on May 20, 2022. The Certificate of Designation of Series D Preferred Stock (the “Series D Certificate of Designation”) provides that all shares of Series D Preferred Stock that are not present in person or by proxy at any meeting of stockholders held to vote on the Reverse Stock Split (as defined in the Series D Certificate of Designation) and the Adjournment Proposal (as defined in the Series D Certificate of Designation) as of immediately prior to the opening of the polls at such meeting (the “Initial Redemption Time”) will automatically be redeemed in whole, but not in part, by the Company at the Initial Redemption Time without further action on the part of the Company or the holder of shares of Series D Preferred Stock (the “Initial Redemption”). Any outstanding shares of Series D Preferred Stock that have not been redeemed pursuant to an Initial Redemption will be redeemed in whole, but not in part, (i) if such redemption is ordered by the Board in its sole discretion, automatically and effective on such time and date specified by the Board in its sole discretion or (ii) automatically upon the approval by the Company’s stockholders of the Reverse Stock Split at any meeting of the stockholders held for the purpose of voting on such proposal (the “Subsequent Redemption”).

On July 27, 2022, at the Company’s 2022 Annual Meeting of Stockholders, the Company’s stockholders approved a proposal to authorize the Board, in its discretion but prior to July 26, 2023, to amend the Company’s Restated Certificate of Incorporation to effect a reverse stock split of all of the outstanding shares of the Company’s Common Stock, at a ratio in the range of 1-for-2 to 1-for-100, with such ratio to be determined by the Board, and all outstanding shares of Series D Preferred Stock were automatically redeemed. As a result, 0 shares of Series D Preferred Stock remain outstanding.

4. Leases

We lease office space and office copiers related primarily to the administrative activities. The Company accounts for leases under ASC 842, Leases, which requires an entity to recognize a right-of-use asset and a lease liability for virtually all leases.

In January 2020, the Company signed a new ~~four-year~~four-year lease which covers approximately 2,771 square feet of office and storage space. This lease is effective March 1, 2020 and extends through February 29, 2024, with a right to extend the term for an additional ~~five-year~~five-year period, subject to the terms and conditions set forth in the lease agreement. The monthly rent is $13,855, subject to annual increases of 3.5 percent. In February 2020, the Company renewed its additional storage space lease, which requires us to make monthly payments of $1,370, subject to a2.5 percent annual increase. The Company recorded a right of use asset and lease liability obligation of $715,310 upon inception of these leases. The Company also reclassified a previously existing right-of-use asset of $66,271 from other assets to right-of-use asset.

As of ~~September~~June 30, ~~2021,~~2022, the balance of right-of-use assets was approximately $~~444,000~~307,000, and the balance of total lease liabilities was approximately $~~461,000~~322,000.

Future minimum lease payments under non-cancelable operating leases under ASC 842 as of ~~September~~June 30, ~~2021~~2022 are as follows:

Schedule of Future Minimum Lease Payments

Operating
Lease Payments

October 2021 – September 2022 $ 198,385
October 2022 – September 2023 199,263
October 2023 – March 2024 84,261
Total future minimum lease payments 481,909

Less: present value adjustment 20,555
Operating lease liabilities at September 30, 2021 461,354
Less: current portion of operating lease liabilities 184,761
Operating lease liabilities, net of current portion $ 276,593

	Operating Lease Payments
July 2022 – June 2023	$	197,600
July 2023 – June 2024		134,690
Total future minimum lease payments		332,290

Less: present value adjustment		9,960
Operating lease liabilities at June 30, 2022		322,330
Less: current portion of operating lease liabilities		132,940
Operating lease liabilities, net of current portion	$	189,390

The components of rent expense and supplemental cash flow information related to leases for the period are as follows:

Schedule of Rent Expense and Supplemental Cash Flow Information Related to Leases

	Period Ended June 30, 2022
Lease Cost

Operating lease cost (included in General and administrative expenses in the Company’s condensed Consolidated Statements of Operations)	$	99,462

Other information

Cash paid for amounts included in the measurement of lease liabilities for the period ended June 30, 2022	$	91,894

Weighted average remaining lease term – operating leases (in years)		1.7

Average discount rate		3.6	%

Period Ended
September 30, 2021
Lease Cost

Operating lease cost (included in General and administrative expenses in the Company’s condensed Consolidated Statements of Operations) $ 149,197

Other information

Cash paid for amounts included in the measurement of lease liabilities for the period ended September 30, 2021 $ 141,900

Weighted average remaining lease term – operating leases (in years) 2.4

Average discount rate 3.6%

4.5. Stock Based Compensation

The Company has a 2008 Stock Incentive Plan (“2008 Plan”) under which 5million shares of common stock are reserved for issuance. As of ~~September~~June 30, ~~2021,~~2022, there were approximately ~~2.3~~1.8 million shares subject to outstanding stock options and approximately0.8 million shares outstanding related to restricted stock grants issued from the 2008 Plan. This plan expired on November 20, 2018 and thus no further shares are available for future grant under this plan.

In November 2019, the Company adopted a 2019 Stock Incentive Plan (“2019 Plan”) under which 5.4 million shares of common stock are reserved for issuance. As of ~~September~~June 30, ~~2021,~~2022, there were ~~0.6~~0.5 million shares subject to outstanding stock options. This ~~Plan~~plan expires on November 14, 2029.

~~The following table sets forth the total stock-based compensation expense resulting from stock options, restricted stock and warrants included in our Condensed Consolidated Statements of Operations:~~

~~Schedule of Stock-based Compensation Expense~~

Three Months Ended September 30,
Nine Months Ended
September 30,

2021 2020 2021 2020
General and administrative — employee — $ 87,277 — $ 260,598
Total employee stock-based compensation $ — $ 87,277 $ — $ 260,598

~~Stock Options~~

There were 0 options granted in either of the periods ended ~~September~~June 30, ~~2021~~2022 and ~~September~~June 30, ~~2020.~~2021.

During the six months ended June 30, 2022, 50,000 options were exercised on a cashless basis in exchange for 21,404 shares of common stock.

Presented below is our stock option activity:

Schedule of Stock Options Activity

Nine Months Ended September 30, 2021

Number of Options
(Employees)

Number of Options
(Non-Employees)
Total Number of Options Weighted-Average Exercise Price
Outstanding at January 1, 2021 2,801,270 365,000 3,166,270 $ 7.43
Exercised (300,000 ) — (300,000 ) $ 0.26
Forfeited or expired (3,570 ) — (3,570 ) $ 30.24
Outstanding at September 30, 2021 2,497,700 365,000 2,862,700 $ 8.15
Exercisable at September 30, 2021 2,497,700 365,000 2,862,700 $ 8.15

	Six Months Ended June 30, 2022
	Number of Options (Employees)			Number of Options (Non-Employees)		Total Number of Options			Weighted-Average Exercise Price
Outstanding at January 1, 2022		2,462,830			365,000		2,827,830		$	8.09
Exercised		(50,000	)		—		(50,000	)	$	0.26
Forfeited or expired		(930,219	)		—		(930,219	)	$	10.65
Outstanding at June 30, 2022		1,482,611			365,000		1,847,611		$	7.02
Exercisable at June 30, 2022		1,482,611			365,000		1,847,611		$	7.02

The following table summarizes significant ranges of outstanding stock options under our plans at ~~September~~June 30, ~~2021:~~2022:

Schedule of Ranges of Stock Options

Range of Exercise Prices	Number of Options		Weighted- Average Remaining Contractual Life (years)		Weighted-Average Exercise Price		Number of Options Exercisable		Weighted- Average Remaining Contractual Life (years)		Weighted-Average Exercise Price		Number of Options		Weighted-Average Remaining Contractual Life (years)		Weighted-Average Exercise Price		Number of Options Exercisable		Weighted-Average Remaining Contractual Life (years)		Weighted-Average Exercise Price
$0.26 - $1.00		550,000		8.21	$	0.26		550,000		8.21	$	0.26		500,000		7.46	$	0.26		500,000		7.46	$	0.26
$1.01 – $3.00		1,050,673		5.86	$	2.04		1,050,673		5.86	$	2.04		634,006		5.21	$	1.96		634,006		5.21	$	1.96
$3.01 – $15.00		852,360		3.22	$	12.56		852,360		3.22	$	12.56		454,166		2.77	$	11.92		454,166		2.77	$	11.92
$15.01 –$42.42		409,667		2.37	$	25.24		409,667		2.37	$	25.24		259,439		1.75	$	23.82		254,439		1.75	$	23.82
		2,862,700		5.02	$	3.32		2,862,700		5.02	$	3.32		1,847,611		5.28	$	3.32		1,847,611		5.28	$	3.32

~~During the three and nine-month periods ended September 30, 2021, the~~The Company recorded no stock compensation costs in either periods ended June 30, 2022 or June 30, 2021 as all options had previously ~~vested, as compared to $30,392~~ ~~and $91,179, respectively, for the three and nine-month periods ended September~~vested. At June 30, ~~2020. As of September 30, 2021,~~2022, there was 0no unrecognized compensation expense related to unvested stock options.

~~During the nine months ended September 30, 2021, options to acquire~~ ~~300,000~~ ~~shares of common stock were exercised resulting in net proceeds of $78,000~~.

The aggregate intrinsic value of the outstanding options and options vested as of ~~September~~June 30, ~~2021~~2022 was $~~0.2~~0 ~~million.~~

~~Stock Warrants~~.

At ~~December 31, 2020,~~June 30, 2022 and June 30, 2021, the Company had ~~193,196~~4,167 warrants outstanding ~~at a weighted average price of $8.60. During 2021,~~ ~~189,029~~ ~~warrants expired, and as such, there were~~ ~~4,167~~ ~~remaining warrants outstanding as of September 30, 2021~~ at a weighted average exercise price of $10.44. At ~~September~~June 30, ~~2021,~~2022, the 4,167 warrants outstanding had no0 intrinsic value.

Restricted Stock

InOn December ~~2017,~~15, 2021, the Company granted to ~~Steven Kriegsman, Chief Executive Officer,~~Jennifer Simpson, who serves on our Board of Directors, ~~387,597~~ 25,000shares of restricted common stock, pursuant to the ~~2008~~2019 Plan. This restricted stock vests ~~in equal annual instalments over~~ ~~three years~~.on the first anniversary of the date of the grant. The fair value of the restricted stock is based on the market price of the Company’s shares on the grant ~~date less the par value received as consideration.~~date. The fair value of the restricted stock on the grant date was $~~679,000~~11,200~~. In December 2016, the Company granted to Steven Kriegsman, Chief Executive Officer,~~ ~~387,597~~ ~~shares of restricted common~~ and recognized stock ~~pursuant to the 2008 Plan. This restricted stock vests in equal annual instalments over~~ ~~three years~~. The fair value of the restricted stock is based on the market price of the Company’s shares on the grant date less the par value received as consideration. The fair value of the restricted stock on the grant datecompensation expense was $~~1,000,000~~6,104 during the six months ended June 30, 2022.. As of June 30, 2022, there is approximately $5,148~~. The Company recorded an employee stock-based~~ of unamortized stock compensation ~~expense for restricted stock of $56,885~~ ~~and $169,419~~ ~~respectively, for the three and nine-month periods ended September 30, 2020. All shares had fully vested as of~~that will be amortized through December ~~31, 2020.~~ ~~NaNrestricted stock was granted in 2021 nor 2020.~~2022.

6. Stockholder Protection Rights Plan

On December 13, 2019, the Board of Directors of the Company, authorized and declared a dividend of one right (a “Right”) for each of the Company’s issued and outstanding shares of common stock, par value $0.001 per share . The dividend was paid to the stockholders of record at the close of business on December 23, 2019. Each Right entitled the registered holder, subject to the terms of the Original Rights Agreement (as defined below), to purchase from the Company one one-thousandth of a share of the Company’s Series B Junior Participating Preferred Stock, par value $0.01 per share (the “Preferred Stock”), at a price of $5.00 (the “Purchase Price”), subject to certain adjustments. The description and terms of the Rights were set forth in the Rights Agreement, dated as of December 13, 2019 (the “Original Rights Agreement”), by and between the Company and American Stock Transfer & Trust Company, LLC, as Rights Agent (the “Rights Agent”).

On November 12, 2020, the Board approved an amendment and restatement of the Original Rights Agreement (as amended and restated, the “Amended and Restated Rights Agreement”) to effect certain changes to the Original Rights Agreement, including (i) reducing the duration to a term of three years, subject to certain earlier expiration as described in more detail below, and (ii) lowering the beneficial ownership threshold at which a person or group of persons becomes an Acquiring Person (as defined below) to 4.95% or more of the Company’s outstanding shares of Common Stock, subject to certain exceptions. The Amended and Restated Rights Agreement is designed to discourage (i) any person or group of persons from acquiring beneficial ownership of more than 4.95% of the Company’s shares of Common Stock and (ii) any existing stockholder currently beneficially holding 4.95% or more of the Company’s shares of Common Stock from acquiring additional shares of the Company’s Common ~~Stock.~~Stock.

The purpose of the Amended and Restated Rights Agreement is to protect value by preserving the Company’s ability to utilize its net operating losses and certain other tax attributes (collectively, the “Tax Benefits”) to offset potential future income tax obligations. The Company’s ability to use its Tax Benefits would be substantially limited if it experiences an “ownership change,” as such term is defined in Section 382 of the Internal Revenue Code of 1986, as amended (the “Tax Code”). A corporation generally will experience an ownership change if the percentage of the corporation’s stock owned by its “5-percent shareholders,” as defined in Section 382 of the Tax Code, increases by more than 50 percentage points over their lowest ownership percentage within a rolling three-year period. The Amended and Restated Rights Agreement is intended to reduce the likelihood the Company would experience an ownership change under Section 382 of the Tax Code.

The Rights will not be exercisable until the earlier to occur of (i) the close of business on the tenth business day after a public announcement or filing that a person or group of affiliated or associated persons has become an “Acquiring Person,” which is defined as a person or group of affiliated or associated persons that, at any time after the date of the Amended and Restated Rights Agreement, has acquired, or obtained the right to acquire, beneficial ownership of 4.95% or more of the Company’s outstanding shares of Common Stock, subject to certain exceptions or (ii) the close of business on the tenth business day after the commencement of, or announcement of an intention to commence, a tender offer or exchange offer the consummation of which would result in any person becoming an Acquiring Person (the earlier of such dates being called the “Distribution Date”) (provided, however, that if such tender or exchange offer is terminated prior to the occurrence of the Distribution Date, then no Distribution Date shall occur as a result of such tender or exchange offer).

The Rights, which are not exercisable until the Distribution Date, will expire at or prior to the earliest of (i) the close of business on November 16, 2023; (ii) the time at which the Rights are redeemed pursuant to the Amended and Restated Rights Agreement; (iii) the time at which the Rights are exchanged pursuant to the Amended and Restated Rights Agreement; (iv) the time at which the Rights are terminated upon the occurrence of certain mergers or other transactions approved in advance by the Board; and (v) the close of business on the date set by the Board following a determination by the Board that (x) the Amended and Restated Rights Agreement is no longer necessary or desirable for the preservation of the Tax Benefits or (y) no Tax Benefits are available to be carried forward or are otherwise available (the earliest of (i), (ii), (iii), (iv) and (v) is referred to as the “Expiration Date”).

Each share of Preferred Stock will be entitled, when, as and if declared, to a preferential per share quarterly dividend payment equal to the greater of (i) $1.00 per share or (ii) an amount equal to 1,000 times the dividend declared per share of Common Stock. Each share of Preferred Stock will entitle the holder thereof to 1,000 votes on all matters submitted to a vote of the stockholders of the Company. In the event of any merger, consolidation or other transaction in which shares of Common Stock are converted or exchanged, each share of Preferred Stock will be entitled to receive 1,000 times the amount received per one share of Common ~~Stock.~~Stock.

The Purchase Price payable, and the number of shares of Preferred Stock or other securities or property issuable, upon exercise of the Rights are each subject to adjustment from time to time to prevent dilution (i) in the event of a stock dividend on, or a subdivision, combination or reclassification of the Preferred Stock, (ii) upon the grant to holders of the Preferred Stock of certain rights or warrants to subscribe for or purchase Preferred Stock or convertible securities at less than the then-current market price of the Preferred Stock or (iii) upon the distribution to holders of the Preferred Stock of evidences of indebtedness or assets (excluding regular periodic cash dividends or dividends payable in Preferred Stock) or of subscription rights or warrants (other than those referred to above). The number of outstanding Rights and the number of one one-thousandths of a share of Preferred Stock issuable upon exercise of each Right are also subject to adjustment in the event of a stock split, reverse stock split, stock dividends and other similar transactions involving the Common Stock.

In the event that any person or group of affiliated or associated persons becomes an Acquiring Person, each holder of a Right, other than the Rights beneficially owned by the Acquiring Person, affiliates and associates of the Acquiring Person and certain transferees thereof (which will thereupon become null and void), will thereafter have the right to receive upon exercise of a Right that number of shares of Common Stock having a market value of two times the Purchase Price.

In the event that, after a person or a group of affiliated or associated persons has become an Acquiring Person, the Company is acquired in a merger or other business combination transaction, or 50% or more of the Company’s assets or earning power are sold, proper provision will be made so that each holder of a Right will thereafter have the right to receive, upon the exercise thereof at the then-current purchase price of the Right, that number of shares of common stock of the acquiring company having a market value at the time of that transaction equal to two times the Purchase Price.

With certain exceptions, no adjustment in the Purchase Price will be required unless such adjustment would require an increase or decrease of at least one percent (1%) in the Purchase Price. No fractional shares of Preferred Stock will be issued (other than fractions which are integral multiples of one one-thousandth of a share of Preferred Stock, which may, at the election of the Company, be evidenced by depositary receipts) and, in lieu thereof, an adjustment in cash will be made based on the market price of the Preferred Stock on the trading day immediately prior to the date of exercise.

At any time after any person or group of affiliated or associated persons becomes an Acquiring Person and prior to the acquisition of beneficial ownership by such Acquiring Person of 50% or more of the outstanding shares of Common Stock, the Board, at its option, may exchange each Right (other than Rights owned by such person or group of affiliated or associated persons which will have become void), in whole or in part, at an exchange ratio of one share of Common Stock per outstanding Right (subject to adjustment).

In connection with any exercise or exchange of the Rights, no holder of a Right will be entitled to receive shares of Common Stock if receipt of such shares would result in such holder, together with such holder’s affiliates and associates, beneficially owning more than 4.95% of the then-outstanding Common Stock (such shares, the “Excess Shares”) and the Board determines that such holder’s receipt of Excess Shares would jeopardize or endanger the value or availability of the Tax Benefits or the Board otherwise determines that such holder’s receipt of Excess Shares is not in the best interests of the Company. In lieu of such Excess Shares, such holder will only be entitled to receive cash or a note or other evidence of indebtedness with a principal amount equal to the then-current market price of the Common Stock multiplied by the number of Excess Shares that would otherwise have been issuable.

At any time before the Distribution Date, the Board may redeem the Rights in whole, but not in part, at a price of ~~$0.001~~$0.001 per Right (subject to certain adjustments) (the “Redemption Price”). The redemption of the Rights may be made effective at such time, on such basis and with such conditions as the Board in its sole discretion may establish.

Immediately upon the action of the Board electing to redeem or exchange the Rights, the Company shall make a public announcement thereof, and upon such election, the right to exercise the Rights will terminate and the only right of the holders of Rights will be to receive the Redemption Price.

Until a Right is exercised or exchanged, the holder thereof, as such, will have no rights as a stockholder of the Company, including, without limitation, the right to vote or to receive dividends.

The Board may amend or supplement the Amended and Restated Rights Agreement without the approval of any holders of Rights, including, without limitation, in order to (a) cure any ambiguity, (b) correct inconsistent provisions, (c) alter time period provisions, including the Expiration Date, or (d) make additional changes to the Amended and Restated Rights Agreement that the Board deems necessary or desirable. However, from and after the date any person or group of affiliated or associated persons becomes an Acquiring Person, the Amended and Restated Rights Agreement may not be supplemented or amended in any manner that would adversely affect the interests of the holders of Rights.

6. ~~Income Taxes~~

~~At December 31, 2020, we had federal and state net operating loss carryforwards of $327.6~~ ~~million and $252.6~~ ~~million, respectively, available to offset against future taxable income. Of this amount, $310.3~~ ~~million of federal NOLs expire in 2024 through 2037. The federal operating losses from 2018, 2019 and 2020 totaling $17.0~~ ~~million carry forward indefinitely but are only able to offset 80% of taxable income in future years. The California NOLs~~ ~~expire in 2029 through 2039. Management currently believes that $258.3~~ ~~million in federal net operating loss carryforwards and $252.6~~ ~~million in state net operating loss carryforwards are unrestricted.~~

7. Commitments and Contingencies

Commitments

Aldoxorubicin

We have an agreement with Vergell Medical (formerly with ~~KTB)~~KTB Tumorforschungs GmbH) (“Vergell”) for the exclusive license of patent rights held by Vergell for the worldwide development and commercialization of aldoxorubicin. Under the agreement, we must make payments to Vergell in the aggregate of $7.5 million upon meeting clinical and regulatory milestones up to and including the product’s second final marketing approval. We also have agreed to pay:

	●	commercially reasonable royalties based on a percentage of net sales (as defined in the agreement);
	●	a percentage of non-royalty sub-licensing income (as defined in the agreement); and
	●	milestones of $1$1 million for each additional final marketing approval that we obtain.

In the event that we must pay a third party in order to exercise our rights to the intellectual property under the agreement, we are entitled to deduct a percentage of those payments from the royalties due Vergell, up to an agreed upon cap.

Arimoclomol

The agreement relating to our worldwide rights to arimoclomol provides for our payment of up to an aggregate of $3.65 million upon receipt of milestone payments from Orphayzme A/S. On May 31, 2022, Orphazyme announced that it had completed the sale of substantially all of its assets and business activities for cash consideration of $12.8 million and assumption of liabilities estimated to equal approximately $5.2 million to KemPharm (the “KemPharm Transaction”). KemPharm is a specialty biopharmaceutical company focused on the discovery and development of novel treatments for rare central nervous system (“CNS”) diseases. As part of the KemPharm Transaction, all of Orphazyme’s obligations to CytRx under the 2011 Arimoclomol Agreement, including with regard to milestone payments and royalties on sales, were assumed by KemPharm.

Innovive

Under the merger agreement by which we acquired Innovive, we agreed to pay the former Innovive stockholders a total of up to approximately $18.3 million of future earnout merger consideration, subject to our achievement of specified net sales under the Innovive license agreements. The earnout merger consideration, if any, will be payable in shares of our common stock, subject to specified conditions, or, at our election, in cash or by a combination of shares of our common stock and cash. Our common stock will be valued for purposes of any future earnout merger consideration based upon the trading price of our common stock at the time the earnout merger consideration is paid.

As of ~~September~~June 30, ~~2021~~2022 and December 31, ~~2020,~~ 02021, no amounts were due under the above agreements.

Contingencies

We apply the disclosure provisions of ASC 460, Guarantees (“ASC 460”) to its agreements that contain guarantees or indemnities by the Company. We provide (i) indemnifications of varying scope and size to certain investors and other parties for certain losses suffered or incurred by the indemnified party in connection with various types of third-party claims; and (ii) indemnifications of varying scope and size to officers and directors against third party claims arising from the services they provide to the Company.

The Company evaluates developments in legal proceedings and other matters on a quarterly basis. The Company records accruals for loss contingencies to the extent that the Company concludes that it is probable that a liability has been incurred and the amount of the related loss can be reasonably estimated.

In December 2019, a novel strain of coronavirus, COVID-19, was first identified in China and has surfaced in several regions across the world. In March 2020, the disease was declared a pandemic by the World Health Organization. As the situation with Covid-19 continues to evolve, the companies which are working to further develop and commercialize our products, ImmunityBio and Orphazyme, could be materially and adversely affected by the risks, or the public perception of the risks, related to this pandemic. Among other things, the active and planned clinical trials by ImmunityBio and Orphazyme and their regulatory approvals, if any, may be delayed or interrupted, which could delay or adversely affect the Company’s potential receipt of milestone and royalty payments within the disclosed time periods and increase expected costs. As of the date of this filing, senior management and administrative staff are working primarily remotely and will return to their offices at a yet to be determined date.

8. Subsequent Events

As discussed on Note 3, on July 27, 2022, both the Initial Redemption and the Subsequent Redemption occurred. As a result, 0 shares of Series D Preferred Stock remain outstanding.

Item 2. — Management’s Discussion and Analysis of Financial Condition and Results of Operations

Overview

CytRx Corporation (“CytRx”) is a biopharmaceutical research and development company specializing in ~~oncology and neurodegenenerative diseases.~~oncology. The Company’s focus ~~has been~~is on the discovery, research and clinical development of novel anti-cancer drug candidates that employ novel ~~linker~~ technologies that target chemotherapeutic drugs to ~~enhance the accumulation~~solid tumors and ~~release of cytotoxic anti-cancer agents at the tumor.~~reduce off-target toxicities. During 2017, CytRx’s discovery laboratory ~~located~~ in Freiburg, Germany, synthesized and tested over 75 rationally designed drug conjugates with highly potent anti-cancer payloads, culminating in the creation of two distinct classes of compounds. Four lead candidates (LADR-7 through LADR-10) were selected based on in vitroand animal ~~preclinical~~ studies in several different cancer models, stability, and manufacturing feasibility. In ~~2018, additional animal efficacy and toxicology testing of these lead candidates was conducted. In~~ addition, a novel ~~albumin~~ companion diagnostic, ACDx™, was developed to identify patients with cancer who are most likely to benefit from treatment with these drug candidates.

On June 1, 2018, CytRx launched Centurion BioPharma Corporation (“Centurion”), a ~~private~~wholly-owned subsidiary, and transferred into Centurion all of its assets, liabilities and personnel associated with the laboratory operations in Freiburg, Germany. In connection with said transfer, the Company and Centurion entered into a Management Services Agreement whereby the Company agreed to render advisory, consulting, financial and administrative services to Centurion, for which Centurion shall reimburse the Company for the cost of such services plus a 5% service charge. ~~The Management Services Agreement may be terminated by either party at any time. Centurion is focused on the development of personalized medicine for solid tumor treatment.~~ On December 21, 2018, CytRx announced that Centurion had concluded the pre-clinical phase of development for its four LADR drug candidates, and ~~for~~of its albumin companion diagnostic (ACDx™). As a result of completing this work, operations taking place at the pre-clinical laboratory in Freiburg, Germany ~~would~~were no longer be needed and ~~accordingly,~~ the lab was closed at the end of January 2019.

~~LADR Drug Discovery Platform~~On March 9, 2022, Centurion merged with and into CytRx, with CytRx absorbing all of Centurion’s assets and continuing after the merger as the surviving entity (the “Merger”). The Merger was implemented through an agreement and plan of merger pursuant to Section 253 of the General Corporation Law of the State of Delaware and did not require approval from either our or Centurion’s stockholders. The Certificate of Ownership merging Centurion into CytRx was filed with the Secretary of State of Delaware on March 9, 2022.

~~Centurion’s~~The LADR Technology Offers the Opportunity for Multiple Pipeline Drugs

Our LADR™ (Linker Activated Drug Release) technology platform consists of an organic backbone that is attached to a ~~discovery engine combining our expertise in linker chemistry~~chemotoxic agent. The purpose of the LADR backbone is to first target and ~~albumin biology to create a pipeline of anti-cancer molecules that will avoid unacceptable systemic toxicity while delivering highly potent agents directly~~deliver the chemotoxic agent to the tumor environment, and then to release the chemotoxic agent within the tumor. ~~Centurion has created a “toolbox” of linker technologies that are designed~~By delivering, concentrating, and releasing the chemotoxic agent within the tumor, one expects to ~~significantly increase~~reduce the ~~therapeutic index of ultra-high potency drugs (10-1,000 times more potent than traditional cytotoxins) by controlling the release~~off-target side-effects of the ~~drug payloads~~chemotherapeutic, which in turn allows for several-fold higher dosing of the chemotherapeutic to the patient. Being small organic molecules, we expect LADR-based drugs to offer the benefits of targeting the tumor without the complexity, side effects, and ~~improving drug-like properties.~~expense inherent in macromolecules such as antibodies and nanoparticles.

~~Centurion’s~~Our LADR-based drugs use circulating albumin as the binding target and as the trojan horse to deliver the LADR drugs to the tumor. Albumin is the most abundant protein in plasma and accumulates inside tumors due to the aberrant vascular structure that exists within them. Tumors use albumin as a nutritional source and for transport of signaling and other molecules that are important to the maintenance and growth of the tumor, which makes albumin an excellent target for drugs that are intended for solid tumors.

Our LADR development efforts ~~were~~are focused on two classes of ultra-high potency albumin-binding ~~drug conjugates.~~drugs. These ~~drug conjugates~~LADR-based drugs, LADR7, 8, 9, and 10, combine the proprietary LADR™ ~~linkers~~backbone with novel derivatives of the auristatin and maytansinoid drug classes. ~~These payloads historically have required a~~Auristatin and maytansinoid are highly potent toxins, and require targeting ~~antibody~~to the tumor for ~~successful~~safe administration to ~~humans. These~~humans, as is the case for the FDA-approved drugs Adcetris (auristatin antibody-drug-conjugate by Seagen) and Kadcyla (maytansine antibody-drug-conjugate by Genentech). We believe that LADR-based drugs offer the benefits of tumor targeting without the disadvantages of antibodies and other macromolecules, which include expense, complexity, and negative side effects. Additionally, albumin is a very well-characterized drug ~~conjugates eliminate~~target, which the ~~need for a targeting antibody~~Company believes will reduce clinical and ~~provide a small molecule therapeutic option with potential broader applicability.~~regulatory risks.

~~Centurion’s~~

Our postulated mechanism of action for the ~~albumin-binding drug conjugates~~LADR-based drugs is as follows:

	●	after administration, the linker portion of the drug conjugate forms a rapid and specific covalent bond to the cysteine-34 position of circulating albumin;

	●	circulating albumin preferentially accumulates ~~at the~~in tumors ~~bypassing concentration in other non-tumor sites, including the heart, liver and gastrointestinal tract~~ due to a mechanism called “Enhanced Permeability and Retention”;, which results in lower exposure to the drug in noncancerous tissues of the heart, liver, and other organs;

	●	once localized at the tumor, the acid-sensitive linker of the LADR backbone is cleaved due to the ~~specific conditions~~lower pH within the tumor and inwithin the tumor microenvironment; and

	●	free active drug is then ~~released.~~released within the tumor, causing tumor cell death.

~~Centurion’s~~The first-generation LADR-based drug is called Aldoxorubicin. Aldoxorubicin is the well-known drug doxorubicin attached to the LADR backbone. Aldoxorubicin has been administered to over 600 human subjects in human clinical trials and has proven the concept of LADR in that several-fold more doxorubicin can be safely administered to patients when the doxorubicin is attached to LADR than when administered as native doxorubicin. Aldoxorubicin has been licensed to ImmunityBio, and is currently in a Phase II registrational intent trial for pancreatic cancer. Aldoxorubicin is expected to enter a Phase I/II trial for glioblastoma in 2022 or 2023.

The IND-enabling work that remains prior to applying to the FDA for first-in-human studies for LADR7-10 is limited due to the extensive experimentation already completed. For example, in the case of LADR7, a manufacturing run under Good Laboratory Practices (GLP) must be completed and some toxicology studies completed using the GLP material must be completed in animals. Toxicology studies with LADR7 have already been completed with non-GLP manufactured drug. Management estimates that these final IND-enabling activities for LADR7 would take approximately 12 months to complete, once funded and initiated, and that Investigational New Drug approval and first-in-human dosing would be achieved within approximately 6-9 months after IND.

Our novel companion diagnostic, ACDx™ (albumin companion diagnostic), was developed to identify patients with cancer who are most likely to benefit from treatment with the four LADR lead assets. The Company has not yet determined whether the use of a companion diagnostic will be necessary or helpful, and plans to continue to investigate this question in parallel to the pre-clinical and clinical development of LADRs 7-10.

~~CytRx~~The LADR backbone and ~~Centurion have been working on identifying partnership opportunities for LADR™ ultra-high potency drug conjugates~~drugs that employ LADR are protected by domestic and its albumin companion diagnostic. However no partnership or any source of financing has become available after over two years of effort. Management continues to seek out sources of capital for Centurion.international patents, and additional patents are pending.

Partnering of Aldoxorubicin

Until July 2017, the Company was focused on the research and clinical development of aldoxorubicin, its modified version of the widely-used cytotoxin agent, doxorubicin. Aldoxorubicin combines the agent doxorubicin with a novel linker-molecule that binds specifically to albumin in the blood to allow for delivery of higher amounts of doxorubicin (3½ to 4 times) without several of the major dose-limiting toxicities seen with administration of doxorubicin alone.

On July 27, 2017, the Company entered into an exclusive worldwide license with ImmunityBio, Inc. (formerly known as NantCell, Inc. (“ImmunityBio”)), granting to ImmunityBio the exclusive rights to develop, manufacture and commercialize aldoxorubicin in all ~~indications, and the Company is~~indications. As a result, we are no longer ~~directly~~ working on ~~the~~ development of ~~aldoxorubicin.~~aldoxorubicin (ImmunityBio merged with NantKwest, Inc. in March 2021). As part of the license agreement, ImmunityBio made a strategic investment of $13 million in CytRx common stock at $6.60 per share (adjusted to reflect our 2017 reverse stock split), a premium of 92% to the market price on that date. ~~In connection therewith, the~~The Company also issued ImmunityBio a warrant to purchase up to 500,000 shares of common stock at $6.60, which expired on January 26, 2019. The Company is entitled to receive up to an aggregate of $343 million in potential milestone payments, contingent upon achievement of certain regulatory approvals and commercial milestones. The Company is also entitled to receive ascending double-digit royalties for net sales for soft tissue sarcomas and mid to high single digit royalties for other indications. There can be no assurance that ImmunityBio will achieve such milestones, approvals or sales with respect to aldoxorubicin.

1719

~~Aldoxorubicin~~ImmunityBio is a conjugate of the commonly prescribed cytotoxin agent doxorubicin that binds to circulating albumin in the bloodstream and is believed to concentrate the drug at the site of the tumor. Aldoxorubicin has been tested in over 600 patients with various types of cancer. Specifically, it is comprised of (6-maleimidocaproyl) hydrazine,conducting an ~~acid-sensitive molecule that is conjugated to doxorubicin. The initial indication for aldoxorubicin is for patients with advanced soft tissue sarcomas (STS). ImmunityBio lists a~~open-label, randomized, Phase 2 ~~and~~study of a ~~randomized Phase 3 study, as well as an~~combination of immunotherapy, aldoxorubicin, and ~~ifosfamide Phase 1/~~standard-of-care chemotherapy versus standard-of-care chemotherapy alone for the treatment of locally advanced or metastatic pancreatic cancer in patients who have had 1 or 2 ~~study~~lines of treatment (Cohorts A and B) or 3 or greater lines of treatment (Cohort C). In June 2022, Immunity Bio presented data at the American Society of Clinical Oncology meeting showing that patients receiving combination immunotherapy with aldoxorubicin plus standard-of-care chemotherapy experienced overall survival of 5.8 months, compared to 3 months for historical control patients that had received only the standard-of-care chemotherapy (n=78, 95% confidence interval 4 to 6.9 months). An additional 25 patients in ~~its solid tumor platform~~the experimental group remain in the study. Thus far, there have been no treatment-related deaths, and ~~is currently reviewing options~~serious adverse events have been uncommon (6%). Immunity Bio plans to meet with the FDA in ~~STS.~~2022 to discuss the path for approval of this combination therapy for pancreatic cancer.

Aldoxorubicin has received Orphan Drug Designation (ODD) by the U.S. Food and Drug Administration (“FDA”) for the treatment of ~~STS.~~soft tissue sarcoma (“STS”). ODD provides several benefits including seven years of market exclusivity after approval, certain R&D related tax credits, and protocol assistance by the FDA. European regulators granted aldoxorubicin Orphan designation for STS which confers ten years of market exclusivity among other benefits.

~~In addition to STS,~~ ImmunityBio ~~has expanded aldoxorubicin’s use by combining it with immunotherapies~~also lists ongoing clinical studies in head and cell-based treatments and is currently in late-stage clinical development in advanced and metastatic pancreatic cancer, and in glioblastoma. ImmunityBio has initiated a phase 2 registrational-intent study in metastatic pancreaticneck cancer and has ~~announced that~~submitted a protocol with the e~~nrollment of Cohort C, which includes Aldoxorubicin and patients who have previously failed two lines of standard-of-care therapy, has now completed enrollment and that~~ ~~the majority of participants~~FDA for glioblastoma; it is currently reviewing its options in the study to date remain on therapy and 90% (43/48) of the evaluable patients have exceeded the approximately two-month historical survival rate. Of the 48 evaluable patients, 23 (48%) had extremely advanced disease upon enrollment (i.e. had progressed after three to six prior lines of therapy) and, of these patients, 20 out of 23 (87%) have exceeded historical survival rates. An ~~early readout of survival data is expected in the first quarter of 2022.~~STS.

Transfer of Rights to Molecular Chaperone Assets

In 2011, CytRx sold the rights to arimoclomol and iroxanadine, based on molecular chaperone regulation technology, to Orphazyme A/S ~~(formerly~~(“Orphazyme”, formerly Orphazyme ApS) in exchange for a one-time, upfront payment and the right to receive up to a total of $120 million ~~(USD)~~ in milestone payments upon the achievement of certain pre-specified regulatory and business milestones, as well as royalty payments based on a specified percentage of any net sales of products derived from ~~arimoclomol. As~~arimoclomol (the “2011 Arimoclomol Agreement”). Orphazyme transferred its rights and obligations under the 2011 Arimoclomol Agreement to KemPharm Denmark A/S (“KemPharm”), a ~~result~~wholly owned subsidiary of ~~Orphazyme’s disclosure~~KemPharm Inc., in May 2022.

In May 2021, Orphazyme announced that the pivotal phase 3 clinical trial for arimoclomol in Amyotrophic Lateral Sclerosis did not meet its primary and secondary endpoints, reducing the maximum amount that CytRx currently has the right to receive ~~is now~~under the 2011 Arimoclomol Agreement to approximately $100 ~~million; however, there can be no assurance that said amount will be realized.~~million. Orphazyme ~~is testing~~also tested arimoclomol in Niemann-Pick disease Type C ~~(NPC)~~(“NPC”) and Gaucher ~~disease. Orphazyme has highlighted positive~~disease, and following a Phase ~~2/3 clinical~~II/III trial ~~data in patients with NPC and had~~ submitted to the FDA a New Drug Application ~~(NDA)~~for the treatment of NPC with ~~the U.S. Food and Drug Administration (the “FDA”).~~arimoclomol. On June 18, 2021, Orphazyme announced it had received a ~~Complete~~complete response letter (the “Complete Response ~~Letter~~Letter”) from the ~~FDA.~~FDA indicating the need for additional data. In late October 2021, Orphazyme announced it ~~recently~~ held a Type A meeting with the FDA, ~~where~~at which the FDA recommended that Orphazyme submit additional data, information and analyses to address certain topics in the Complete Response Letter and engage in further interactions with the FDA to identify a pathway to resubmission. The FDA concurred with Orphazyme’s proposal to remove the cognition domain from the NPC Clinical Severity Scale (“NPCCSS”) endpoint, with the result that the primary endpoint is permitted to be recalculated using the 4- domain NPCCSS, subject to the submission of additional requested information which Orphazyme ~~intends~~had publicly indicated that it intended to provide. To bolster the confirmatory evidence already submitted, the FDA affirmed that it would require additional in vivo or pharmacodynamic (PD)/pharmacokinetic (PK) ~~data;~~data. Orphazyme ~~is considering~~planned to request a Type C Meeting with the ~~optimal path forward~~FDA in the second quarter of 2022. Subject to ~~address~~discussions with the ~~FDA’s requests.~~regulatory body, Orphazyme ~~has~~had publicly indicated that it planned to resubmit the NDA for arimoclomol in the second half of 2022.

Orphazyme had also submitted a Marketing Authorization Application ~~(MAA)~~(“MAA”) with the European Medicines Agency ~~(EMA)~~(the “EMA”). In February 2022, Orphazyme announced that although they had received positive feedback from the Committee for Medicinal Products for Human Use (“CHMP”) of the EMA, they were notified by the CHMP of a negative trend vote on the MAA for arimoclomol for NPC following an oral explanation. In March 2022 Orphazyme removed its application with the EMA. Orphazyme has publicly indicated that it will assess its strategic options and ~~expects~~provide an update to ~~hear~~the market at the applicable time.

On May 31, 2022, Orphazyme announced that it had completed the sale of substantially all of its assets and business activities for cash consideration of $12.8 million and assumption of liabilities estimated to equal approximately $5.2 million to KemPharm (the “KemPharm Transaction”). KemPharm is a ~~response~~specialty biopharmaceutical company focused on the discovery and development of novel treatments for rare central nervous system (“CNS”) diseases. As part of the KemPharm Transaction, all of Orphazyme’s obligations to CytRx under the 2011 Arimoclomol Agreement, including with regard to milestone payments and royalties on sales, were assumed by KemPharm. KemPharm is expected to continue the early access programs with arimoclomol, and to continue to pursue the potential approval of arimoclomol as a treatment option for NPC. KemPharm indicated it plans on resubmitting the NDA for arimoclomol in the first quarter of 2022; it has established an Early Access Program in the United States as well as other select European countries. Orphazyme has also received FDA Breakthrough Therapy Designation for arimoclomol for NPC. Orphayzme recently announced its intention that arimoclomol will be marketed globally under the tradename MIPLYFFA™. CytRx would be entitled to a milestone payment of $4 million upon EMA approval and $2 million upon approval in Japan, along with royalties and potential additional milestone payments. There can be no assurance that Orphazyme will achieve such approvals.2023.

Recent Developments

Series D Preferred Stock

~~Current Business Strategy~~On May 19, 2022, the Board declared a dividend of one one-thousandth of a share of Series D Preferred Stock, par value $0.01 per share, for ~~LADR~~™ ~~Platform~~each outstanding share of Company’s Common Stock to stockholders of record at 5:00 p.m. Eastern Time on May 20, 2022. The Certificate of Designation of Series D Preferred Stock provides that all shares of Series D Preferred Stock that are not present in person or by proxy at any meeting of stockholders held to vote on the Reverse Stock Split (as defined in the Series D Certificate of Designation) and the Adjournment Proposal (as defined in the Series D Certificate of Designation) as of immediately prior to the opening of the polls at such meeting (Initial Redemption Time) will automatically be redeemed in whole, but not in part, by the Company at the Initial Redemption Time without further action on the part of the Company or the holder of shares of Series D Preferred Stock (Initial Redemption). Any outstanding shares of Series D Preferred Stock that have not been redeemed pursuant to an Initial Redemption will be redeemed in whole, but not in part, (i) if such redemption is ordered by the Board in its sole discretion, automatically and effective on such time and date specified by the Board in its sole discretion or (ii) automatically upon the approval by the Corporation’s stockholders of the Reverse Stock Split at any meeting of the stockholders held for the purpose of voting on such proposal (Subsequent Redemption). On July 27, 2022, at the Company’s 2022 Annual Meeting of Stockholders, the Company’s stockholders approved the Reverse Stock Split and the Adjournment Proposal, and all outstanding shares of Series D Preferred Stock were automatically redeemed. As a result, no shares of Series D Preferred Stock remain outstanding.

~~Currently,~~On July 27, 2022, at the ~~Company~~Company’s 2022 Annual Meeting of Stockholders, the Company’s stockholders approved a proposal to authorize the Board, in its discretion but prior to July 26, 2023, to amend the Company’s Restated Certificate of Incorporation to effect a reverse stock split of all of the outstanding shares of the Company’s Common Stock, at a ratio in the range of l-for-2 to l-for-100, with such ratio to be determined by the Board, and ~~Centurion are working on identifying partnership opportunities for LADR™ ultra-high potency drug conjugates and their albumin companion diagnostic, although~~all outstanding shares of Series D Preferred Stock were automatically redeemed. As a result, no ~~partnerships or other sources~~shares of financing have become available after over two years of effort. We have concluded all research and development on LADR and its companion diagnostic, but continue to focus on identifying these partnership and financing opportunities.Series D Preferred Stock remain outstanding.

Critical Accounting Policies and Estimates

Management’s discussion and analysis of our financial condition and results of operations are based on our financial statements, which have been prepared in accordance with accounting principles generally accepted in the ~~United States.~~U.S. The preparation of these financial statements requires management to make estimates and judgments that affect the reported amounts of assets, liabilities, revenue and expenses, and related disclosure of contingent assets and liabilities. On an ongoing basis, management evaluates its estimates, including those related to revenue recognition, impairment of long-lived assets, including finite-lived intangible assets, research and development expenses and clinical trial expenses and stock-based compensation expense.

We base our estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ materially from these estimates under different assumptions or conditions.

Our significant accounting policies are summarized in Note 2 to our financial statements contained in ~~our~~the 2021 Annual ~~Report on Form 10-K for the year ended December 31, 2020 (as amended, the “2020 Annual Report”).~~Report.

We believe the following critical accounting policies affect our more significant judgments and estimates used in the preparation of our financial statements.

Stock-Based Compensation

~~Off-Balance Sheet Arrangements~~Inflation Risk

~~We do~~The Company does not believe that inflation has had a material effect on its operations to date, other than the impact of inflation on the general economy. However, there is a risk that the Company’s operating costs could become subject to inflationary pressures in the future, which would have ~~any off-balance sheet arrangements.~~the effect of increasing the Company’s operating costs, and which would put additional stress on the Company’s working capital resources.

Liquidity and Capital Resources

WeGoing Concern

The Company’s condensed consolidated financial statements have ~~relied primarily upon proceeds~~been presented on the basis that it will continue as a going concern, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. During the six months ended June 30, 2022, the Company incurred a net loss of $2,089,687, utilized cash in operations of $2,248,429, and had an accumulated deficit of $486,573,965 as of June 30, 2022. In addition, the Company has no recurring revenue. As a result,management has concluded that there is substantial doubt about the Company’s ability to continue as a going concern. The Company’s consolidated financial statements do not include any adjustments that might result from ~~sales~~the outcome of ~~our equity securities and~~this uncertainty. The Company’s independent registered public accounting firm, in its report on the ~~exercise of options and warrants, and~~Company’s consolidated financial statements for the year ended December 31, 2021, has also expressed substantial doubt about the Company’s ability to continue as a ~~much lesser extent upon payments from our strategic partners and licensees, to generate funds needed to finance our business and operations.~~going concern.

At ~~September~~June 30, ~~2021,~~2022, we had cash and cash equivalents and short-term investments of approximately ~~$16.5~~$4.1 million. ~~Management believes~~The continuation of the Company as a going concern is dependent upon its ability to obtain necessary debt or equity financing to continue operations until it begins generating positive cash flow. No assurance can be given that ~~our current cash and cash equivalents and short-term investments~~any future financing will be ~~sufficient~~available or, if available, that it will be on terms that are satisfactory to ~~fund~~ the ~~Company’s operations for~~Company. Even if the ~~foreseeable future. This estimate~~Company is based, in part, upon our currently projected expenditures for the remainder of 2021 and the first ten months of 2022 of approximately $4.9 million (unaudited) to fund operating activities. These projected expenditures exclude any payments related to possible liquidated damages or dividends to be paid on the Preferred Stock (as defined below). These projected expenditures and payments are also based upon numerous other assumptions and subject to many uncertainties, and our actual expenditures may be significantly different from these projections. While these projections represent our current expected expenditures, CytRx has the ability to reduce the amounts and alter the timing of certain expenditures as needed to manage its liquidity needs while still advancing its corporate objectives. We will ultimately be requiredable to obtain additional ~~funding~~financing, it may contain undue restrictions on our operations, in ~~order to execute~~the case of debt financing or cause substantial dilution for our ~~long-term business plans, although we do not currently have commitments from any third parties to provide us with long term debt~~stockholders, in case or capital. CytRx cannot assure that additional funding will be available on favorable terms, or at all. If we fail to obtain additional funding when needed, we may have to liquidate some or all of our assets or delay or reduce the scope of or eliminate some portion or all of our development programs.equity financing.

~~Cash Flows from Operating Activities~~

Net cash used in operating activities for the ~~nine~~six months ended ~~September~~June 30, ~~2021~~2022 was ~~$2.8~~$2.2 million, which was primarily the result of a net loss from operations of ~~$4.2~~$2.1 million, and $0.1 million in net cash outflows associated with changes in assets and liabilities. The net cash outflows associated with changes in assets and liabilities were primarily due to decreases of $0.9 million of prepaid expenses and other current assets, $0.1 million of insurance claim receivable and $0.1 million of amortization of right-of-use asset, offset by reductions of $0.3 million of accounts payable, $0.8 million in accrued liabilities and $0.1 million of decrease in lease liabilities.

Net cash used in operating activities for the six months ended June 30, 2021 was $1.6 million, which was primarily the result of a net loss from operations of $2.5 million, offset by ~~$1.4~~$0.8 million in net cash inflows associated with changes in assets and liabilities. The net cash inflows associated with changes in assets and liabilities were primarily due to increases of ~~$1.0~~$0.8 million of prepaid expenses and other current assets, $0.3 million of insurance claim receivable, ~~$0.2~~$0.1 million of accrued expenses and other current liabilities and $0.1 million of amortization of right-of-use asset, offset by reductions of ~~$0.2~~$0.4 million of accounts payable and ~~$0.1~~$0.9 million of decrease in lease liabilities.

Net cash used in operating activities for the nine months ended September 30, 2020 was $3.5 million, which was primarily the result of a net loss from operations of $5.3 million, offset by $1.5 million of adjustments associated with changes in assets and liabilities. The net cash inflows associated with changes in assets and liabilities were primarily due to increases of $1.6 million in accounts payable, $0.3 million in accrued expenses and other current liabilities and $0.2 million of amortization of right-of-use asset, offset by reductions of $0.5 million of prepaid expenses and other current assets and $0.1 million of decrease in lease liabilities.

~~Cash Flows from Investing Activities~~

We purchased nominimal fixed assets in the ~~nine-month~~six-month period ended ~~September~~June 30, ~~2021~~2022 and a minimal amount of fixed assets in the ~~nine-month~~six-month period ended ~~September~~June 30, ~~2020,~~2021, and do not expect any significant capital spending during the next 12 months.

~~Cash Flows from Financing Activities~~

We paid dividends on the preferred shares of $0.4 million in the six-month period ended June 30, 2022. Net cash provided by financing activities for the ~~nine~~six months ended ~~September~~June 30, 2021 was ~~$9.3~~$0.1 million, $9.2 million of which is related to the sale of our common stock, Series C 10% Convertible Preferred Stock and preferred investment options described in Note 2 of our unaudited financial statements contained in this Quarterly Report and $0.1 millionresulting from the exercise of stock options. ~~In the nine months ended September 30, 2020, stock options were exercised, resulting in a cash infusion of $39,000.~~

The registration rights agreement entered into between us and the Investor on July 13, 2021, contains a triggering event which would require us to pay to any holder of the Preferred Stock an amount in cash, as partial liquidated damages and not as a penalty, equal to the product of 2.0% multiplied by the aggregate subscription amount paid by such holder for shares of Series C Preferred Stock pursuant to the Purchase Agreement; provided, however, that such partial liquidated damages shall not exceed 24% of the aggregate subscription amounts paid by such holders pursuant to the Purchase Agreement or $1,977,600. If we fail to pay any partial liquidated damages within seven days after the date payable, we will be required to pay interest on any such amounts at a rate equal to the lesser of 18% per annum or the maximum rate permitted by applicable law.

We continue to evaluate potential future sources of capital, as we do not currently have commitments from any third parties to provide us with additional capital and we may not be able to obtain future financing on favorable terms, or at all. The results of our technology licensing efforts and the actual proceeds of any fund-raising activities will determine our ongoing ability to operate as a going concern. Our ability to obtain future financings through joint ventures, product licensing arrangements, royalty sales, equity financings, grants or otherwise is subject to market conditions and our ability to identify parties that are willing and able to enter into such arrangements on terms that are satisfactory to us. Depending upon the outcome of our fundraising efforts, the accompanying financial information may not necessarily be indicative of our future financial condition. Failure to obtain adequate financing would adversely affect our ability to operate as a going concern.

We do not have any off-balance sheet arrangements.

There can be no assurance that we will be able to generate revenues from our product candidates and become profitable. Even if we become profitable, we may not be able to sustain that profitability.

Results of Operations

We recorded a net loss of approximately ~~$1.7~~$0.8 million and ~~$4.1~~$2.1 million for the three-month and ~~nine-month~~six-month periods ended ~~September~~June 30, ~~2021,~~2022, respectively, as compared to a net loss of approximately ~~$2.8~~$1.2 million and ~~$5.3~~$2.5 million for the three-month and ~~nine-month~~six-month periods ended ~~September~~June 30, ~~2020,~~2021, respectively.

We recognized no licensing revenue in the ~~nine-month~~six-month periods ended ~~September~~June 30, ~~2021~~2022 and ~~2020.~~2021. All future licensing fees under our current licensing agreements are dependent upon successful development milestones being achieved by the licensor.

General and Administrative Expenses

	Three-Month Period Ended September 30,				Nine-Month Period Ended September 30,				Three-Month Period Ended June 30,				Six-Month Period Ended June 30,
	2021		2020		2021		2020		2022		2021		2022		2021
	(In thousands)				(In thousands)				(In thousands)				(In thousands)
General and administrative expenses	$	1,530	$	2,113	$	3,984	$	4,303	$	1,141	$	1,178	$	2,430	$	2,454
Amortization of stock awards		—		87		—		261		3		—		6		—
Depreciation and amortization		3		8		10		22		4		3		7		7
	$	1,533	$	2,208	$	3,994	$	4,586	$	1,148	$	1,181	$	2,443	$	2,461

General and administrative expenses include all administrative salaries and general corporate expenses, including legal expenses. Our general and administrative expenses, excluding stock expense, non-cash expenses and depreciation and amortization, were ~~$1.5~~$1.1 million and ~~$4.0~~$2.45 million for the three and ~~nine-month~~six-month periods ended ~~September~~June 30, ~~2021,~~2022, respectively, and ~~$2.2~~$1.2 million and ~~$4.6~~$2.5 million, respectively, for the same periods in ~~2020.~~2021. Our general and administrative expenses in the comparative periods excluding amortization of stock awards, non-cash expenses and depreciation and amortization, decreased marginally.

Depreciation and Amortization

Depreciation expense reflects the depreciation of our equipment and furnishings.

~~Interest and Liquidated Damages Expense~~Forgiveness of Accounts Payable

~~Liquidated damages~~During the three-month period ended June 30, 2022, one of ~~$164,800~~the Company’s vendors issued a credit note of $353,565 related to ~~the Securities Purchase Agreement signed in July 2021 was paid in the three-month~~past general and ~~nine-month period ended September 30, 2021. There were no such expenses in the comparative 2020 periods.~~administrative services.

Interest Income

Interest income was approximately ~~$4,400~~$1,000 and ~~$13,400~~$2,000 for the three-month and ~~nine-month~~six-month periods ended ~~September~~June 30, ~~2021,~~2022, respectively, as compared to ~~$21,300~~$4,000 and ~~$112,000,~~$9,000, respectively, for the same periods in ~~2020.~~2021.

Item 3. — Quantitative and Qualitative Disclosures About Market Risk

Our exposure to market risk is limited primarily to interest income sensitivity, which is affected by changes in the general level of U.S. interest rates, particularly because a significant portion of our investments are in short-term debt securities issued by the U.S. government and institutional money market funds. The primary objective of our investment activities is to preserve principal. Due to the nature of our short-term investments, we believe that we are not subject to any material market risk exposure. We do not have any speculative or hedging derivative financial instruments or foreign currency instruments. If interest rates had varied by 10% in the three-month period ended ~~September~~June 30, ~~2021,~~2022, it would not have had a material effect on our results of operations or cash flows for that period.

Item 4. — Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Our management, with the participation of our Chief Executive Officer and our Chief Financial Officer, performed an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Securities Exchange Act Rule 13a-15(e)) as of the end of the quarterly period covered by this Quarterly Report. Based on that evaluation, our Chief Executive Officer and our Chief Financial Officer concluded that our disclosure controls and procedures were effective to ensure that information required to be disclosed by us in reports that we file or submit under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the SEC.

Our disclosure controls and procedures are designed to provide reasonable assurance of achieving their objectives as specified above. Management does not expect, however, that our disclosure controls and procedures will prevent or detect all errors and fraud. Any control system, no matter how well designed and operated, is based upon certain assumptions and can provide only reasonable, not absolute, assurance that its objectives will be met. Further, no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud, if any, within the Company have been detected.

Changes in Controls over Financial Reporting

There was no change in our internal control over financial reporting that occurred during the quarter ended ~~September~~June 30, ~~2021~~2022 that materially affected, or is reasonably likely to materially affect, our internal control over financial reporting. We continually seek to assure that all of our controls and procedures are adequate and effective. Any failure to implement and maintain improvements in the controls over our financial reporting could cause us to fail to meet our reporting obligations under the SEC’s rules and regulations. Any failure to improve our internal controls to address the weaknesses we have identified could also cause investors to lose confidence in our reported financial information, which could have a negative impact on the trading price of our common stock.

PART II — OTHER INFORMATION

Item 1. — Legal Proceedings

None.

Item 1A. — Risk Factors

You should carefully consider and evaluate the information in this Quarterly Report and the risk factors set forth under the caption “Item 1A. Risk Factors” in our 2021 Annual Report, which was filed with the SEC on March ~~24, 2021 (as amended on July 13, 2021).~~23, 2022. The risk factors associated with our business have not materially changed compared to the risk factors disclosed in the 2021 Annual Report.

Item 2. — Unregistered Sales of Equity Securities and Use of Proceeds

None.

Item 3. — Defaults Upon Senior Securities

None.

Item 4. — Mine Safety Disclosure

Not applicable.

Item 5. — Other Information

None.

Item 6. — Exhibits

The exhibits listed in the accompanying Index to Exhibits are filed as part of this Quarterly Report and incorporated herein by reference.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	CytRx Corporation

Date: ~~November 12, 2021~~August 11, 2022	By:	/s/ JOHN Y. CALOZ
		John Y. Caloz
		Chief Financial Officer

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INDEX TO EXHIBITS

Exhibit Number		Description
~~2.1~~		Agreement and Plan of Merger, dated as of June 6, 2008, among CytRx Corporation, CytRx Merger Subsidiary, Inc., Innovive Pharmaceuticals, Inc., and Steven Kelly (previously filed as Exhibit 2.1 to the Company’s Form 8-K filed with the SEC on June 9, 2008).
3.1		~~Restated~~ Certificate of ~~Incorporation of CytRx Corporation, as amended (previously filed as Exhibit 3.1~~Correction to the ~~Company’s Form 10-K on March 13, 2012).~~
~~3.2~~		Certificate of Amendment of Restated Certificate of Incorporation ~~(prreviously filed as Exhibit 3.1~~(incorporated by reference to ~~the Company’s Form 8-K filed with the SEC on May 15, 2012).~~
~~3.3~~		~~Certificate of Amendment of Restated Certificate of Incorporation (previously filed as Exhibit 3.1 to the Company’s Form 8-K filed with the SEC on November 1, 2017).~~
~~3.5~~		~~Certificate of Elimination of Series B Convertible Preferred Stock (previously filed as~~ Exhibit 3.3 to the Company’s Form 8-K filed with the SEC on ~~December~~May 19, ~~2019)~~2022).
~~3.7~~3.2		Certificate of ~~the Designations, Powers, Preferences and Rights~~Designation of Series ~~C 10.00% Convertible~~D Preferred Stock ~~(previously filed as~~(incorporated by reference to Exhibit 3.1 to the Company’s Form ~~8-K~~8-A filed with the SEC on ~~July 15, 2021)~~May 19, 2022).
~~3.8~~3.3		Amended and Restated By-Laws of CytRx Corporation, effective November 12, 2020 ~~(previously filed as Exhibit 3.2 to the Company’s Form 8-K filed with the SEC on November 17, 2020).~~
~~4.1~~		~~Amended~~ and Restated Rights Agreement, dated as of November 16, 2020, by and between CytRx Corporation and American Stock Transfer & Trust Company, LLC, as rights agent (previously filed as Exhibit 4.1 to the Company’s Form 8-K filed with the SEC on November 17, 2020).
~~4.2~~		~~Warrant, dated as of July 27, 2017, issued by CytRx Corporation to NantCell, Inc. (previously filed as Exhibit 10.3 to the Company’s Form 8-K filed with the SEC on August 1, 2017).~~
~~4.3~~		~~Form of Preferred Investment Option (previously filed as Exhibit 4.1 to the Company’s Form 8-K filed with the SEC on July 15, 2021).~~
~~10.1~~		Form of Securities Purchase Agreement, dated as of July 13, 2021, by and between the Company and the purchaser thereto (previously filed as Exhibit 10.1 to the Company’s Form 8-K filed with the SEC on July 15, 2021).
~~10.2~~		Form of Registration Rights Agreement, dated as of July 13, 2021, by and between the Company and the purchaser thereto (previously filed as Exhibit 10.2 to the Company’s Form 8-K filed with the SEC on July 15, 2021).
~~10.3~~		Amendment No. 1 to the ~~Cooperation Agreement,~~Amended and Restated Bylaws of dated ~~September 2, 2021, by and between CytRx Corporation and Jerald A. Hammann (previously filed as Exhibit 10.1 to the Company’s Form 8-K filed with the SEC on September 9, 2021).~~May 19, 2022.
31.1		Certification of Chief Executive Officer ~~Pursuant~~pursuant to ~~Item 601(b)(31)~~Rule 13A-14(a) or 15D-14(a) of ~~Regulation S-K,~~the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of ~~2002~~2002.
31.2		Certification of Chief Financial Officer ~~Pursuant~~pursuant to ~~Item 601(b)(31)~~Rule 13A-14(a) or 15D-14(a) of ~~Regulation S-K,~~the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of ~~2002~~2002.
32.1		Certification of Chief Executive Officer ~~Pursuant~~pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2		Certification of Chief Financial Officer ~~Pursuant~~pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS		Inline XBRL Instance Document
101.SCH		Inline XBRL ~~Taxonomy Extension~~ Schema Document
101.CAL		Inline XBRL ~~Taxonomy Extension~~ Calculation Linkbase Document
101.DEF		Inline XBRL ~~Taxonomy Extension~~ Definition Linkbase Document
101.LAB		Inline XBRL ~~Taxonomy Extension~~ Label Linkbase Document
101.PRE		Inline XBRL ~~Taxonomy Extension~~ Presentation Linkbase Document
104		Cover Page Interactive Data File ~~(embedded within the~~(formatted as Inline ~~XBRL document)~~XBRL)

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Balance at January 1, 2020	33,637,501	$	33,637	$	479,197,849	$	(464,026,774	)	$	15,204,712
Issuance of stock options/warrants for compensation and services	—		—		86,662		—			86,662
Net loss			-				(1,172,786	)		(1,172,786	)
Balance at March 31, 2020	33,637,501	$	33,637	$	479,284,511	$	(465,199,560	)	$	14,118,588
Issuance of stock options/restricted stock for compensation and services					86,659					86,659
Net loss			-				(1,341,490	)		(1,341,490	)
Balance at June 30, 2020	33,637,501	$	33,637	$	479,371,170	$	(466,541,050	)	$	12,863,757

Exercise of stock options	2,842,537		2,843		36,157					39,000
Issuance of stock options/restricted stock for compensation and services					87,277					87,277
Net loss			-				(2,774,558	)		(2,774,558	)

Balance at September 30, 2020	36,480,038	$	36,480	$	479,494,604	$	(469,315,606	)	$	10,215,478
Ending balance, value	36,480,038	$	36,480	$	479,494,604	$	(469,315,606	)	$	10,215,478

	Operating Lease Payments

October 2021 – September 2022	$	198,385
October 2022 – September 2023		199,263
October 2023 – March 2024		84,261
Total future minimum lease payments		481,909

Less: present value adjustment		20,555
Operating lease liabilities at September 30, 2021		461,354
Less: current portion of operating lease liabilities		184,761
Operating lease liabilities, net of current portion	$	276,593

	Period Ended September 30, 2021
Lease Cost

Operating lease cost (included in General and administrative expenses in the Company’s condensed Consolidated Statements of Operations)	$	149,197

Other information

Cash paid for amounts included in the measurement of lease liabilities for the period ended September 30, 2021	$	141,900

Weighted average remaining lease term – operating leases (in years)		2.4

Average discount rate		3.6%

	Three Months Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020
General and administrative — employee		—	$	87,277		—	$	260,598
Total employee stock-based compensation	$	—	$	87,277	$	—	$	260,598

	Nine Months Ended September 30, 2021
	Number of Options (Employees)			Number of Options (Non-Employees)		Total Number of Options			Weighted-Average Exercise Price
Outstanding at January 1, 2021		2,801,270			365,000		3,166,270		$	7.43
Exercised		(300,000	)		—		(300,000	)	$	0.26
Forfeited or expired		(3,570	)		—		(3,570	)	$	30.24
Outstanding at September 30, 2021		2,497,700			365,000		2,862,700		$	8.15
Exercisable at September 30, 2021		2,497,700			365,000		2,862,700		$	8.15