Cytrx Corp – ‘PRES14A’ for 12/7/95

As of:  Wednesday, 12/13/95   ·   For:  12/7/95   ·   Accession #:  799698-95-9   ·   File #:  0-15327

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Preliminary Proxy Solicitation Material — Special Meeting   —   Schedule 14A
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Document/Exhibit                   Description                      Pages   Size 

 1: PRES14A     Preliminary Proxy Solicitation Material -- Special    13     57K 
                          Meeting                                                

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PRES14A
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SCHEDULE 14A INFORMATION  
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934

Filed by the Registrant [X]                                                     
Filed by a Party other than the Registrant [ ]                                  

Check the appropriate box:                                                      

[X] Preliminary Proxy Statement     [ ] Confidential, for Use of the            
                                Commission Only (as permitted by
                 Rule 14a-6(e)(2))
[ ] Definitive Proxy Statement                                                  
[ ] Definitive Additional Materials                                             
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12               

CYTRX CORPORATION   
(Name of Registrant as Specified In Its Charter)    

  (Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):                              

[X] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(i)(2)     
or Item 22(a)(2) of Schedule 14A.                                       
[ ] $500 per each party to the controversy pursuant to Exchange Act             
Rule 14a-6(i)(3).                                                       
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.    

1) Title of each class of securities to which transaction applies:      

2) Aggregate number of securities to which transaction applies:         

    3) Per unit price or other underlying value of transaction computed pursuant
     to Exchange Act Rule 0-11 (Set forth the amount on which the filing fee
is calculated and state how it was determined):                   

4) Proposed maximum aggregate value of transaction:                     

5) Total fee paid:                                                      

[ ] Fee paid previously with preliminary materials.                             
[ ] Check box if any part of the fee is offset as provided by Exchange Act      
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously.  Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.             

1) Amount Previously Paid:                                              

2) Form, Schedule or Registration Statement No.:                        

3) Filing Party:                                                        

4) Date Filed:                                                          

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[CYTRX CORPORATION LETTERHEAD]                                  PRELIMINARY COPY
December 7, 1995                                                                

Dear Stockholder:                                                               

You are cordially invited to attend a Special Meeting of Stockholders of
CytRx Corporation to be held on February 5, 1996 at 8:00 a.m. local time, at the
Hilton Hotel at Peachtree Corners, 5993 Peachtree Industrial Boulevard,         
Norcross, Georgia  30092.                                                       

The only item of business to be addressed at the Special Meeting is to  
consider and act upon a proposal to amend CytRx's Certificate of Incorporation  
to effect a recapitalization through a one-for-four reverse stock split.  On    
the effective date of the amendment every four shares of CytRx's Common Stock   
outstanding will become and be exchanged for one new share of Common Stock.     
The amendment also reduces the number of authorized shares of Common Stock from 
75,000,000 to 18,750,000 in order to effect the reverse stock split and to      
prevent an increase in the company's franchise tax expense.  Please note that   
the reverse stock split will not change your proportionate equity interests in  
CytRx, except as may result from the elimination of fractional shares.          

 The Board of Directors believes that the recent per share price has had a
negative effect on the marketability of CytRx's Common Stock.  It has been      
suggested by both stockholders and analysts that a reverse split will position  
CytRx more attractively with institutional investors and retail stock brokers   
who generally have restrictions on investing in low-priced stocks.  A higher    
stock price also increases broker/dealer interest in maintaining markets in     
CytRx's stock.  Individual stockholders benefit as transaction costs relative   
to the total value of stock trades may be reduced.  Additionally, the reverse   
split will improve CytRx's ability to carry out its subsidiary financing        
strategy.  As CytRx's subsidiaries make solid progress, the Company plans to    
offer shares in each to the public; a higher CytRx share price will better      
position these new shares with investors vis-a-vis CytRx stock.  Finally, this  
is an opportune time to effect a reverse split as CytRx's Common Stock is       
currently trading near book value levels.  Thus, investors have a tangible      
reference point in evaluating the price of the stock before and after the       
reverse split.                                                                  

The Board of Directors unanimously recommends that CytRx's stockholders 
approve the amendment to the Certificate of Incorporation to effect the reverse 
stock split.  The enclosed Proxy Statement sets forth more detailed information 
regarding the amendment and the reverse stock split.  Please carefully review   
the information contained in the Proxy Statement.                               

   Whether or not you plan to attend the Special Meeting, it is important that
you sign, date and return the enclosed proxy card as soon as possible.  Please  
use the enclosed postage pre-paid envelope to return the executed proxy card.   
If you attend the meeting, you may revoke your proxy at any time by requesting  
the right to vote in person.  By immediately signing, dating and returning the  
enclosed proxy card, you will save the Company the cost of further              
solicitations.                                                                  

Sincerely,

     Jack J. Luchese
                         President & Chief Executive Officer

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                             CYTRX CORPORATION                  PRELIMINARY COPY
154 Technology Parkway      
Norcross, Georgia 30092     
-----------------------     
NOTICE OF SPECIAL MEETING OF STOCKHOLDERS     
to be held on Monday, February 5, 1996    
-----------------------     

To the Stockholders of CytRx Corporation:                                       

Notice is hereby given to the holders of the $.001 par value per share  
Common Stock (the "Common Stock") of CytRx Corporation (the "Company") that a   
Special Meeting of Stockholders (the "Meeting") of the Company will be held at  
the Hilton Hotel at Peachtree Corners, 5993 Peachtree Industrial Boulevard,     
Norcross, Georgia 30092, on Monday, February 5, 1996, at 8:00 a.m. local time.  
The sole purpose of the Meeting is to consider and vote upon a proposal to amend
the Company's Certificate of Incorporation (the "Amendment") to effect a        
recapitalization through a one-for-four reverse stock split (the "Reverse Stock 
Split") pursuant to which every four shares of Common Stock outstanding on the  
effective date of the Amendment will become and be exchanged for one new share  
of Common Stock ("New Common Stock").  The Amendment also reduces the number of 
authorized shares of Common Stock from 75,000,000 to 18,750,000 in order to     
reduce the Company's franchise tax expense.  To avoid the existence of          
fractional shares of New Common Stock, stockholders who would otherwise be      
entitled to receive fractional shares of New Common Stock shall receive cash in 
lieu thereof.                                                                   

In addition, the purpose of the Meeting shall be to transact such other 
business incidental to the conduct of the Meeting as may properly come before   
the Meeting or any adjournments or postponements of the Meeting.  Stockholders  
of record at the close of business on December 7, 1995 are entitled to receive  
notice of and to vote at the Meeting and at any and all adjournments or         
postponements thereof.  All stockholders, whether or not they expect to attend  
the Meeting in person, are requested to complete, date, sign and return the     
enclosed form of proxy in the accompanying postage-paid envelope.  The proxy    
may be revoked by the person executing the proxy by filing with the Secretary   
of the Company an instrument of revocation or duly executed proxy bearing a     
later date, or by electing to vote in person at the Meeting.                    

Information relating to the Reverse Stock Split is set forth in the     
accompanying Proxy Statement dated December 7, 1995.  Please carefully review   
the information contained in the Proxy Statement, which is incorporated into    
this Notice.                                                                    

   The regular Annual Meeting of Stockholders, which will include a management
presentation, will be held later in the year.  This Special Meeting is          
scheduled as a requirement for the Reverse Stock Split.                         
                                     By Order of the Board of Directors,

                 James M. Yahres
           Secretary
December 7, 1995                                                                

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                              CYTRX CORPORATION                 PRELIMINARY COPY
154 Technology Parkway  
Norcross, Georgia 30092 
                                                                 January 5, 1996
------------------------- 
PROXY STATEMENT 
 FOR A SPECIAL MEETING OF STOCKHOLDERS
TO BE HELD ON FEBRUARY 5, 1996
------------------------- 

   This Proxy Statement is furnished to the holders of common stock, par value
$.001 per share (the "Common Stock"), of CytRx Corporation, a Delaware          
corporation (the "Company"), in connection with the solicitation of proxies by  
the Board of Directors to be used at a Special Meeting of Stockholders of the   
Company, and at any and all adjournments or postponements thereof (the          
"Meeting").  The Meeting will be held on Monday, February 5, 1996 at 8:00 a.m., 
local time, at the Hilton Hotel at Peachtree Corners, 5993 Peachtree Industrial 
Boulevard, Norcross, Georgia, to consider and vote upon a proposed amendment    
(the "Amendment") to the Company's Certificate of Incorporation (the            
"Certificate"), as specified in the accompanying Notice of Special Meeting of   
Stockholders.  The Amendment will effect a recapitalization of the Company      
through a one-for-four reverse stock split (the "Reverse Stock Split") pursuant 
to which every four shares of Common Stock outstanding on the effective date of 
the Amendment (the "Effective Date") will become and be exchanged for one new   
share of Common Stock ("New Common Stock").  The Amendment also reduces the     
number of authorized shares of Common Stock from 75,000,000 to 18,750,000 in    
order to reduce the Company's franchise tax expense.  The text of the Amendment 
is set forth in Exhibit A to this Proxy Statement.                              

 The Company's mailing address and the location of its principal executive
offices are 154 Technology Parkway, Norcross, Georgia  30092.                   

VOTING                                                                          

General                                                                         

The securities that may be voted at the Meeting consist of the Common   
Stock, with each share entitling its owner to one vote on the proposal to       
approve the Amendment.  The record date for determining the holders of Common   
Stock who are entitled to notice of and to vote at the Meeting is December 7,   
1995 (the "Record Date").  On the Record Date, 31,426,231 shares of Common      
Stock were outstanding and eligible to be voted at the meeting.                 
Notwithstanding the Record Date specified above, the Company's stock transfer   
books will not be closed and shares may be transferred subsequent to the Record 
Date.  However, all votes must be cast in the names of stockholders of record   
on the Record Date.                                                             

Quorum and Vote Required                                                        

  The presence, in person or by proxy, of a majority of the shares of Common
Stock outstanding on the Record Date is necessary to constitute a quorum at the 
Meeting.  The affirmative vote of the holders on the Record Date of a majority
 of the issued and outstanding shares of Common Stock is required to approve the
Amendment.                                                                    

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   Abstentions will be considered present and entitled to vote at the Meeting.
However, abstentions will not be counted as votes cast in the affirmative and   
therefore will have the effect of a vote against the proposal.                  

  If fewer shares are voted in favor of the proposed Amendment than required
for its approval, the Meeting may be adjourned for the purpose of allowing      
additional time for obtaining additional proxies or votes with respect to the   
Reverse Stock Split.  At any subsequent reconvening of the Meeting, all proxies 
will be voted on the matter(s) to be considered at the reconvened Meeting in the
same manner as such proxies would have been voted on the matter(s) at the       
original convening of the Meeting (except for any proxies which have theretofore
effectively been revoked or changed), notwithstanding that they may have been   
effectively voted on the same or any other matter at a previous meeting.  Any   
such adjournment will require the affirmative vote of a majority of the shares  
present at the session of the Meeting to be adjourned. A proxy granting         
authority to vote upon such other business incidental to the conduct of the     
Meeting as may properly come before the Special Meeting will constitute         
authority to vote in favor of one or more adjournments of the Meeting.          

Proxies                                                                         

  In voting their Common Stock, stockholders may vote in favor of or against
the proposal to approve the Amendment or may abstain from voting.  Stockholders 
should specify their choice on the accompanying proxy card.  All properly       
executed proxy cards delivered pursuant to this solicitation and not revoked    
will be voted at the Meeting in accordance with the directions given.  IF NO    
SPECIFIC INSTRUCTIONS ARE GIVEN WITH REGARD TO THE MATTER TO BE VOTED UPON, THEN
THE SHARES REPRESENTED BY A SIGNED PROXY CARD WILL BE VOTED "FOR" THE APPROVAL  
OF THE AMENDMENT AND IN THE DISCRETION OF SUCH PROXIES TO ANY OTHER PROCEDURAL  
MATTERS WHICH MAY PROPERLY COME BEFORE THE MEETING OR ANY ADJOURNMENTS THEREOF. 
All proxies delivered pursuant to this solicitation are revocable at any time   
before they are voted at the option of the persons executing them by (i) giving 
written notice to the Secretary of the Company, (ii) by delivering a later dated
proxy card or (iii) by voting in person at the Meeting.  All written notices of 
revocation and other communications with respect to revocations of proxies      
should be addressed to James M. Yahres, Secretary, CytRx Corporation, 154       
Technology Parkway, Norcross, Georgia  30092.                                   

HOLDERS OF COMMON STOCK ARE REQUESTED TO COMPLETE, DATE AND SIGN THE    
ACCOMPANYING PROXY CARD AND RETURN IT PROMPTLY TO THE COMPANY IN THE            
ACCOMPANYING POSTAGE-PAID ENVELOPE.                                             

In addition to the solicitation of proxies by mail, the Company, through
its directors, officers and employees, may solicit proxies from stockholders    
personally or by telephone or other forms of communication.  In addition, Beacon
Hill Partners will assist in the solicitation of proxies from the Company's     
stockholders for a fee of $2,000.  The Company will reimburse Beacon Hill       
Partners for reasonable out-of-pocket costs and expenses incurred in the        
solicitation of proxies.  The Company also will request brokerage houses,       
nominees, fiduciaries and other custodians to forward soliciting materials to   
beneficial owners, and the Company will reimburse such persons for their        
reasonable expenses incurred in doing so.  All expenses incurred in connection  
with the solicitation of proxies will be borne by the Company.                  

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Stockholder Proposals                                                           
Any proposal which a Company Stockholder intends to present at the next 
annual meeting of stockholders to be held in 1996 must have been received by the
Company on or before December 25, 1995.  Only those proper proposals which are  
received in a timely manner will be included in the Proxy Statement and Proxy.  

Security Ownership of Certain Beneficial Owners and Management                  

  Based solely upon information made available to the Company, the following
table sets forth certain information with respect to the beneficial ownership of
Common Stock as of December 7, 1995 by (i) each person who is known by the      
Company to beneficially own more than five percent of Common Stock; (ii) each   
director of the Company; (iii) each of the Named Executive Officers; and (iv)   
all executive officers and directors as a group.  Except as otherwise indicated,
the holders listed below have sole voting and investment power with respect to  
all shares of Common Stock beneficially owned by them.                          

                                          Shares of Common Stock
Name and Address of Beneficial Owner              Number   Percentage (1)       

Named Executive Officers and Directors (2):                                     
Lucine Beauchard (3)                          101,563         *         
Jack L. Bowman (4)                              9,56          *         
Raymond C. Carnahan, Jr. (5)                   38,500         *         
Francis J. Casieri (6)                         30,824         *         
R. Martin Emanuele (7)                        269,290         *         
Jack J. Luchese (8                          2,493,087        7.4%       
Herbert H. McDade (9)                          49,167         *         
Selvi Vescovi (10)                             57,500         *         
James M. Yahres (11)                          114,366         *         
All executive officers and directors                                    
as a group (10 persons) (12)                3,212,051        9.3%       

Other 5% Stockholders:                                                          
Robert L. Hunter, Jr. (13)                  2,061,715        6.5%       
3640 Churchwell Court                                                   
Tucker, Georgia  30084                                                  

J. Morton Davis                             1,833,125        5.8%       
D.H. Blair Investment Banking Corp.                                     
44 Wall Street                                                          
New York, NY  10005                                                     
___________________________                                                     
* Less than 1%                                                              

(1)  Based on 31,426,231 shares of Common Stock outstanding on December 7, 1995.
(2)  The business address of all such persons is: c/o CytRx Corporation, 154    
Technology Parkway, Norcross, Georgia  30092.                         

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(3)  Includes options to purchase 87,800 shares of Common Stock exercisable     
within 60 days.                                                       
(4)  Includes options to purchase 6,666 shares of Common Stock exercisable      
within 60 days.                                                       
(5)  Includes options to purchase 37,500 shares of Common Stock exercisable     
within 60 days.                                                       
(6)  Includes options to purchase 19,179 shares of Common Stock exercisable     
within 60 days.                                                       
(7)  Includes options to purchase 265,424 shares of Common Stock exercisable    
within 60 days.                                                       
(8)  Includes warrants to purchase 2,454,706 shares of Common Stock exercisable 
within 60 days.                                                       
(9)  Includes options to purchase 49,167 shares of Common Stock exercisable     
within 60 days.                                                       
(10) Includes options to purchase 52,500 shares of Common Stock exercisable     
within 60 days.                                                       
(11) Includes options to purchase 95,570 shares of Common Stock exercisable     
within 60 days.                                                       
(12) Includes options to purchase 3,111,273 shares of Common Stock exercisable  
within 60 days.                                                       
(13) Includes options to purchase 73,365 shares of Common Stock exercisable     
within 60 days.                                                       

PROPOSED AMENDMENT TO THE   
CERTIFICATE TO EFFECT THE REVERSE STOCK SPLIT   

General                                                                         

 The Company proposes to effect a recapitalization through the adoption of
the Amendment which provides for the Reverse Stock Split.  If the Amendment is  
approved by the stockholders, each FOUR shares of Common Stock outstanding on   
the Effective Date will be converted automatically into ONE share of New Common 
Stock and the number of authorized shares of Common Stock will be reduced from  
75,000,000 to 18,750,000.  To avoid the existence of fractional shares of New   
Common Stock, stockholders who would otherwise be entitled to receive fractional
shares of New Common Stock shall receive a cash distribution in lieu thereof.   
The Effective Date of the Reverse Stock Split will be the date on which the     
Amendment is filed with the Secretary of State of Delaware, which is anticipated
to be as soon as practicable following the date of the Meeting.                 

Background of and Reasons for the Reverse Stock Split                           

On December 7, 1995 the Board of Directors adopted resolutions approving
the Amendment, calling the Meeting and directing that the Amendment be placed on
the agenda for the consideration of the stockholders at the Meeting.            

The Board of Directors believes that the recent per share price of the  
Common Stock has had a negative effect on the marketability of the existing     
shares, the amount and percentage of transaction costs paid by individual       
stockholders and the potential ability of the Company to raise capital by       
issuing new shares.  The Company believes there are several reasons for these   
effects, as summarized below.                                                   

Most brokerage houses do not permit lower-priced stocks to be used as   
collateral for margin accounts or to be purchased on margin.  Further, the Board
of Directors believes that the current per share price of the Common Stock may  
limit the effective marketability of the Common Stock because of the reluctance 
of many brokerage firms and institutional investors to recommend lower-priced   
stocks to their clients or to hold them in their own portfolios.  Certain       
policies and practices of the securities industry may tend to discourage        
individual brokers within those firms from dealing in lower-priced stocks.  Some
of those policies and practices involve time-consuming procedures that make the 
handling of lower-priced stocks economically unattractive.  The brokerage       
commission on the purchase or sale of a lower-priced stock may also represent a 
higher percentage of the price than the brokerage commission on a higher-priced 
issue.                                                                          

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The Board of Directors is optimistic that the decrease in the number of 
shares of Common Stock outstanding as a consequence of the proposed Reverse     
Stock Split and the resulting anticipated increased price level will encourage  
greater interest in the Common Stock by the financial community and the         
investment public.                                                              

  There can be no assurances, however, that the foregoing effects will occur
or that the market price of the CytRx Common Stock immediately after            
implementation of the proposed Reverse Stock Split will rise, and if it rises,  
no assurance that such rise can be maintained for any period of time, or that   
such market price will approximate four times the market price before the       
proposed Reverse Stock Split.                                                   

    Dissenting stockholders have no appraisal rights under Delaware law or under
the Company's Certificate and Bylaws in connection with the Reverse Stock Split.

  The Company's Common Stock is traded on The Nasdaq Stock Market's National
Market System ("Nasdaq") under the trading symbol CYTR.  The following table    
sets forth the quarterly high and low closing sale prices per share for the     
Common Stock as reported by Nasdaq for the Company's past two fiscal years.     

Fiscal Quarter Ended                        High         Low                    
1995                                                                            
December 31 (through December 7)            3 5/32       29/32                  
September 30                                3 3/8       1 5/8                   
June 30                                     2 11/16     1 7/16                  
March 31                                    2 19/32     1 5/16                  

1994                                                                            
December 31                                 2 11/16     1 1/4                   
September 30                                4 5/8       2 1/8                   
June 30                                     6 5/8       4                       
March 31                                    8 1/4       5 5/8                   

   FOR THE REASONS STATED ABOVE, THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS
THAT ALL STOCKHOLDERS VOTE "FOR" THE APPROVAL OF THE AMENDMENT.                 

   The Reverse Stock Split may be abandoned by the Board of Directors pursuant
to Section 242(a) of the Delaware General Corporation Code at any time before,  
during or after the Meeting and prior to the filing of the Certificate of       
Amendment to the Company's Certificate of Incorporation with the Secretary of   
State of the State of Delaware giving effect to the Reverse Stock Split if, for 
any reason, the Board of Directors deems it advisable to do so.                 

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Effects of the Reverse Stock Split                                              

General Effects.  If the Amendment is approved by the stockholders, the 
principal effect of the Reverse Stock Split will be to decrease the number of   
outstanding shares from 31,426,231 shares to approximately 7,856,558 shares,    
based on share information as of December 7, 1995, and reduce the number of     
authorized shares of Common Stock from 75,000,000 to 18,750,000.                

In order that the Company may avoid the expense and inconvenience of    
issuing and transferring fractional shares of New Common Stock, stockholders who
would otherwise be entitled to receive a fractional share of New Common Stock   
("Fractional Stockholders") shall receive payment in cash in lieu of receiving a
fractional share of New Common Stock.  The Board of Directors has authorized the
Company's officers to combine all fractional shares of New Common Stock that    
would otherwise be issued and to direct the Company's transfer agent to sell    
such combined fractional shares of New Common Stock on the open market on behalf
of and as agent for the Fractional Stockholders.  The sales proceeds will then  
be distributed to the Fractional Stockholders as a cash payment in lieu of      
fractional shares of New Common Stock.  See "Exchange of Shares and Payment in  
Lieu of Issuance of Fractional Shares."                                         

The Reverse Stock Split may leave certain stockholders with one or more 
"odd-lots" of New Common Stock, i.e. stock in amounts of less than 100 shares.  
These odd-lots may be more difficult to sell or require greater transaction cost
per share to sell, than shares in even multiples of 100.                        

 Effect on Market for Common Stock.  On December 7, 1995, the closing sale
price of the Common Stock on Nasdaq was $1.00 per share.  By decreasing the     
number of shares of Common Stock outstanding without altering the aggregate     
economic interest in the Company represented by such shares, the Board of       
Directors believes that the trading price will be increased to a price more     
appropriate for an exchange listed security; however, there can be no assurance 
that this will occur.  The New Common Stock will continue to be traded on Nasdaq
under the symbol CYTR.                                                          

 Effect on Outstanding Options, Warrants and Convertible Securities of the
Company.  As of December 7, 1995, the Company had outstanding options and       
warrants to purchase 4,191,071 shares of Common Stock with exercise prices per  
share that ranged from $.69 to $7.75.  Upon the effectiveness of the Reverse    
Stock Split, the Compensation Committee of the Board of Directors shall make a  
proportional downward adjustment to the number of shares subject to outstanding 
options and a corresponding upward adjustment in the per share exercise prices  
to reflect the Reverse Stock Split.                                             

Changes in Stockholders' Equity.  As an additional result of the Reverse
Stock Split, the Company's stated capital, which consists of the par value per  
share of Common Stock multiplied by the number of shares of Common Stock issued,
will be reduced by approximately $23,746 to $7,915 on the Effective Date.       
Although the par value of the Common Stock will remain at $.001 per share       
following the Reverse Stock Split, stated capital will be decreased because the 
number of shares issued and outstanding will be reduced.  Correspondingly, the  
Company's capital in excess of par value, which consists of the difference      
between the Company's stated capital and the aggregate amount paid to the       
Company upon the issuance by the Company of all currently outstanding Common    
Stock, will be increased by approximately $23,746.                              

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 FEDERAL INCOME TAX CONSEQUENCES

   The following summary of the federal income tax consequences of the Reverse
Stock Split is based on current law, including the Internal Revenue Code of     
1986, as amended (the "Code"), and is for general information only.  The tax    
treatment of a stockholder may vary depending upon the particular facts and     
circumstances of such stockholder.  Certain stockholders, including insurance   
companies, tax-exempt organizations, financial institutions, broker-dealers,    
non-resident aliens, foreign corporations and persons who do not hold the Common
Stock as a capital asset, may be subject to special rules not discussed below.  
ACCORDINGLY, EACH STOCKHOLDER SHOULD CONSULT HIS TAX ADVISOR TO DETERMINE THE   
PARTICULAR TAX CONSEQUENCES TO HIM OF THE REVERSE STOCK SPLIT, INCLUDING THE    
APPLICATION AND EFFECT OF FEDERAL, STATE, LOCAL OR FOREIGN INCOME TAX AND OTHER 
LAWS.                                                                           

 The receipt of shares of New Common Stock (excluding fractional shares of
New Common Stock) in the Reverse Stock Split should be a nontaxable transaction 
under the Code for federal income tax purposes.  Consequently, a stockholder    
receiving shares of New Common Stock should not recognize either gain or loss,  
or any other type of income, with respect to whole shares of New Common Stock   
received as a result of the Reverse Stock Split.  In addition, the tax basis of 
such stockholder's shares of Common Stock prior to the Reverse Stock Split will 
carry over as the tax basis of the stockholder's shares of New Common Stock.    
Each Stockholder will be required to allocate his basis in his shares of Common 
Stock ratably among the total number of shares of New Common Stock owned        
following the Reverse Stock Split.  The holding period of the shares of New     
Common Stock will also include the holding period during which the stockholder  
held the Common Stock, provided that such Common Stock was held by the          
stockholder as a capital asset on the Effective Date.                           

The receipt by a Fractional Stockholder of cash in lieu of a fractional 
share of New Common Stock pursuant to the Reverse Stock Split will be a taxable 
transaction for federal income tax purposes.  The receipt of cash in lieu of    
fractional shares of New Common Stock will result in gain or loss (rather than  
dividend income) to the Fractional Stockholders assuming, as the Company        
believes, that such cash distribution is undertaken solely for the purpose of   
saving the Company the expense and inconvenience of issuing and transferring    
fractional shares of New Common Stock.  Gain or loss will be recognized by each 
Fractional Stockholder equal to the difference between the amount of cash       
received by such Stockholder and the portion of the aggregate tax basis in his  
Common Stock allocable to his fractional share interest in New Common Stock.  If
a Fractional Stockholder's shares of Common Stock are held as a capital asset on
the Effective Date, then such Fractional Stockholder's gain or loss will be a   
capital gain or loss.  Such capital gain or loss will be long-term capital gain 
or loss if on the Effective Date the shares of Common Stock have been held by   
the Fractional Stockholder for longer than one year.                            

   Based on certain exceptions contained in regulations issued by the Internal
Revenue Service, the Company does not believe that it or Fractional Stockholders
will be subject to backup withholding or informational reporting with respect to
the cash distributed to a Fractional Stockholder.                               

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EXCHANGE OF SHARES AND PAYMENT IN LIEU OF 
ISSUANCE OF FRACTIONAL SHARES 

   On or after the Effective Date, the Company will mail to each stockholder a
letter of transmittal.  A stockholder will be able to receive his shares of New 
Common Stock and, if applicable, cash in lieu of a fractional share of New      
Common Stock only by transmitting to the Transfer Agent such stockholder's stock
certificate(s) for shares of Common Stock outstanding prior to the Reverse Stock
Split, together with the properly executed and completed letter of transmittal  
and such evidence of ownership of such shares as the Company may require.       
Stockholders will not receive certificates for shares of New Common Stock unless
and until the certificates representing their shares of Common Stock outstanding
prior to the Reverse Stock Split are surrendered.  Stockholders should not      
forward their certificates to the Transfer Agent until the letter of transmittal
is received and should surrender their certificates only with such letter of    
transmittal.                                                                    

No scrip or fractional share certificates for New Common Stock will be  
issued in connection with the Reverse Stock Split.  The Board of Directors has  
authorized the Company's officers to combine all fractional shares of New Common
Stock and to direct the Transfer Agent to sell such combined fractional shares  
of New Common Stock on the open market on behalf of and as agent for the        
Fractional Stockholders.  Sales of fractional interests will be effected by the 
Transfer Agent as soon as practicable on the basis of prevailing market prices  
of the New Common Stock on Nasdaq at the time of sale.  The sales proceeds will 
then be distributed to the Fractional Stockholders as cash payment in lieu of   
fractional shares of New Common Stock.  A payment in lieu of a fractional share 
of New Common Stock will be made to a Fractional Stockholder promptly after     
receipt of a properly completed letter of transmittal and stock certificate(s)  
for all of his shares of Common Stock outstanding prior to the Reverse Stock    
Split.                                                                          

   There will be no service charges payable by the stockholders of the Company
in connection with the exchange of their certificates or in connection with the 
payment of cash in lieu of the issuance of fractional shares of New Common      
Stock.  These costs will be borne by the Company.                               

                 By Order of the Board of Directors,

James M. Yahres,  
Secretary         
December 7, 1995                                                                

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                                                                   Exhibit A
PROPOSED CERTIFICATE OF AMENDMENT   
TO THE    
CERTIFICATE OF INCORPORATION    
OF    
CYTRX CORPORATION   

   Pursuant to the provisions of Section 242 of the General Corporation Law of
the State of Delaware, the undersigned, the President and Secretary of CytRx    
Corporation (the "Corporation"), hereby certify that:                           

FIRST:    The name of the corporation is CYTRX CORPORATION              

SECOND:    The Certificate of Incorporation of the Corporation was filed
with the Secretary of State, Wilmington, Delaware on February 28, 1985.         

THIRD:    Upon this Certificate of Amendment to the Certificate of      
Incorporation becoming effective pursuant to the Delaware General Corporation   
Law (the "Effective Time"), each FOUR outstanding shares of Common Stock, par   
value $.001 per share ("Common Stock"), shall thereupon be reclassified and     
changed into ONE share of Common Stock, par value $.001 per share ("New Common  
Stock").  Upon such Effective Time, each holder of Common Stock shall thereupon 
automatically be and become the holder of ONE share of New Common Stock for     
every FOUR shares of Common Stock then held by such holder.  Upon such Effective
Time, each certificate formerly representing a stated number of shares of Common
Stock shall thereupon be a deemed for all corporate purposes to evidence        
ownership of New Common Stock in the appropriately reduced whole number of      
shares.  As soon as practicable after such Effective Time, stockholders as of   
the date of the reclassification will be notified thereof and, upon their       
delivery of their certificates of Common Stock to the Company, will be sent     
stock certificates representing their shares of New Common Stock, rounded down  
to the nearest whole number, together with cash representing the fair value of  
such holder's fractional shares of Common Stock.  No scrip or fractional share  
certificates for Common Stock will be issued in connection with this reverse    
stock split.                                                                    

FOURTH:    The first paragraph of Article Fourth of the Certificate of  
Incorporation, relating to the capital stock of the Corporation, is hereby      
amended to read in its entirety as follows:                                     

"FOURTH:  1. The total number of shares of all classes of stock that the        
corporation shall have the authority to issue is Twenty Million One Thousand    
(18,751,000), of which Twenty Million (18,750,000) shall be common stock, par   
value $.001 per share (the "Common Stock") and One Thousand (1,000) shall be    
preferred stock, par value $.01 per share (the "Preferred Stock").              

   FIFTH:    This amendment of the Certificate of Incorporation was authorized
by the affirmative vote of a majority of the Directors of the Corporation,      
followed by the affirmative vote of the holders of a majority of the            
Corporation's Common Stock.                                                     

PRES14A
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PRELIMINARY COPY                                                                
   CytRx Corporation
         Proxy for Special Meeting of Stockholders, Feburary 5, 1996

The undersigned hereby appoints Jack J. Luchese and James M. Yahres or  
either of them acting singly in the absence of the other, with full power of    
substitution, proxies to vote at a Special Meeting of Stockholders of CytRx     
Corporation (the "Company") to be held at the Hilton Hotel at Peachtree Corners,
5993 Peachtree Industrial Boulevard, Norcross, Georgia, on February 5, 1995 at  
8:00 a.m., local time, and at any adjournment or adjournments thereof, hereby   
revoking any proxies heretofore given, to vote all shares of common stock of the
Company held or owned by the undersigned as directed below, and in their        
discretion upon such other matters as may properly come before the meeting.     

The shares represented by this Proxy, duly executed, will be voted as   
directed by the Stockholder.  WHERE NO DIRECTION IS GIVEN WHEN THE DULY EXECUTED
PROXY IS RETURNED, THE SHARES WILL BE VOTED FOR PROPOSAL 1 AND, IF APPLICABLE,  
IN THE DISCRETION OF SUCH PROXIES AS TO ANY OTHER PROCEDURAL MATTERS WHICH MAY  
PROPERLY COME BEFORE THE MEETING OR ANY ADJOURNMENTS THEREOF.                   

(CONTINUED AND TO BE SIGNED ON REVERSE SIDE)                                    

PLEASE MARK YOUR VOTE THIS WAY  /X/                                             

1. Proposal to amend the Certificate of Incorporation to effect a one-for-four  
reverse stock split.                                                            

FOR           AGAINST        ABSTAIN        
/   /           /   /          /   /          

Shares Held:    _____________                                                   

_________________________________                                               
Signature                                                                       

_________________________________                                               
Signature (if held jointly)                                                     

DATE: ____________                                                              

NOTE: Please sign exactly as name appears hereon.  Joint owners should each     
sign.  When signing as attorney, executor, administrator, trustee or guardian,  
please give full title as such.  If a corporation, please sign in full corporate
name by President or other authorized officer.  If a partnership, please sign in
partnership name by authorized person.                                          

THIS PROXY IS SOLICITED ON BEHALF OF CYTRX CORPORATION'S BOARD OF DIRECTORS AND 
MAY BE REVOKED BY THE STOCKHOLDER PRIOR TO ITS EXERCISE.                        

Dates Referenced Herein   and   Documents Incorporated by Reference

				Referenced-On Page
This ‘PRES14A’ Filing		Date		First		Last			Other Filings
		2/5/96		2		4
		1/5/96		4
		12/25/95		6
Filed on:		12/13/95
For Period End:		12/7/95		2		11			DEFS14A
		2/5/95		13
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