Ex 10.7
MUTUAL AND GENERAL RELEASE OF ALL CLAIMS
This Mutual and General Release is entered into between CYTRX CORPORATION
(hereinafter "CYTRX"), and MADISON & WALL WORLDWIDE, INC. (hereinafter "M & W"),
and is intended by said parties to effect the legal consequences provided by
Section 1541 of the California Civil Code; that is, the extinguishment of
obligations as hereinafter set forth.
In consideration of the payment by CYTRX to M & W of the sum of $50,000
cash and 200,000 shares of CYTRX common stock (the "Stock"), each of the parties
hereby mutually relinquishes their respective legal rights and those of their
heirs, legal representatives and assigns, affiliated partnerships or
corporations, their officers, directors, stockholders, or their successors and
assigns, receivers and trustees in bankruptcy, administrators, successors and
assigns, and all other persons, firms, corporations, associations, and
partnerships, and release one another from any and all liability and all future
claims, actions, interests, demands, rights, damages, costs, loss of services,
proceedings, debts, dues, sums of money, contracts, agreements, controversy,
expenses, and compensation, of any nature whatsoever, which the parties, or any
of them, may have or which may hereafter accrue on account of, or in any way
growing out of any and all known, and unknown, foreseen and unforeseen facts,
injuries or damages arising out of the facts alleged in the Complaint filed by M
& W entitled, Madison & Wall Worldwide, Inc. v. Cytrx Corporation, on April ___,
2004, Orange County Superior Court Case No. 04CC04463 (the "Incident").
The Stock is being issued to M & W under a private placement exemption
under applicable federal and state securities laws. CYTRX has communicated to M
& W and M & W understands that CYTRX intends to file a Form S-1 registration
statement covering the resale of CYTRX securities by certain CYTRX shareholders
(the "Resale Registration Statement") within sixty days of filing its Form 10-K
for the year ended December 31, 2003 (the "2003 Form 10-K"). M & W represents
that it has reviewed the 2003 Form 10-K, including the "Risk Factors" section
contained therein. CYTRX will use its best efforts to register the Stock with
the Resale Registration Statement or with any new registration statement on Form
S-3 or any other
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available Form (other than Form S-8 or Form S-4) that CYTRX files prior to the
filing of the Resale Registration Statement. Notwithstanding the foregoing,
CYTRX will not have an obligation to include the Stock in any registration
statement covering an underwritten offering in which the underwriter for that
offering advises CYTRX that it is not willing to include the Stock in that
registration statement, provided that at least 75,000 shares of the Stock are
included in that underwritten registration statement and the remaining 125,000
shares of the Stock will continue to have the registration rights set forth
above. In the event that CYTRX fails to include the Stock in the next new
registration statement (other than a Form S-8 or Form S-4 Registration
Statement) that it files after the date hereof that does not cover an
underwritten offering, CYTRX will pay M & W as liquidated damages $25,000 for
each 30-day period after that registration statement is filed during which CYTRX
has not filed a registration statement covering the Stock. CytRx and M & W shall
enter into a registration rights agreement reasonably acceptable to both parties
that sets forth the foregoing registration obligations of CYTRX and includes
other customary provisions for an agreement of this type.
It is understood and agreed that this Mutual and General Release of All
Claims is the compromise of a disputed claim and that this Mutual and General
Release of All Claims is not to be construed as an admission of liability on the
part of any of the parties hereby released and that the parties hereby released
deny liability therefor and intend merely to avoid litigation and buy their
peace. This Mutual and General Release of All Claims is the result of bargaining
and negotiation by and between the parties, and represents a final, mutually
agreeable compromise.
It is understood and agreed that each of the parties hereby expressly
waive all rights under Section 1542 of the Civil Code of California which
provides as follows:
"CERTAIN CLAIMS NOT AFFECTED BY GENERAL RELEASE A general release
does not extend to claims which the creditor does not know or
suspect to exist in his favor at the time of executing the release,
which if known by him must have materially affected his settlement
with the debtor."
The parties hereto, and each of them, fully understand that they cannot
hereafter make any further claim or seek any further recovery from the parties
being released herein by reason of
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the aforesaid incident, and they expressly waive all future unknown claims
caused by, or alleged to be caused by, the aforesaid incident.
The parties hereto, and each of them, further declare and represent that
there has been no other promise, inducement or agreement, and that this Mutual
and General Release of All Claims constitutes the ENTIRE AGREEMENT between the
parties hereto, and that the terms of this Mutual and General Release of All
Claims are contractual and not a mere recital.
Full performance by each party hereto of each and all of their respective
obligations hereunder shall constitute a condition precedent to the
effectiveness of each of the releases and discharges made hereunder in their
favor.
Each party hereto hereby represents and warrants that said party has not
assigned or otherwise transferred, and will not hereafter assign or otherwise
transfer, any interest in any claim which is released by said party hereunder,
and each party hereto agrees to indemnify, hold harmless and defend each and
every person and other entity who is released by said party hereunder, with
respect to any and all claims which may arise out of or by reason of any such
assignment or transfer of any interest in any such claim.
This Mutual and General Release of All Claims may be executed in multiple
counterparts, each of which shall be deemed an original and all of which shall
constitute but one agreement. Copies of this Mutual and General Release of All
Claims, including facsimile copies may be used in lieu of the originals for all
purposes. If a party signs this Mutual and General Release of All Claims and
then transmits an electronic facsimile of the signature page to any other party,
that party who receives the transmission may rely upon the electronic facsimile
as a signed original of this Mutual and General Release of All Claims.
All parties agree to keep this Mutual and General Release of All Claims
and its terms confidential and not disclose this Mutual and General Release of
All Claims and the facts and circumstances surrounding the transactions between
the parties to third parties, except disclosures (i) in response to a Summons or
Subpoena; (ii) by order or request of any governmental authority or
administrative agency; (iii) by Court Order; (iv) to senior management of each
party; (v) to attorneys, accountants or other professional advisors to a party
provided they
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are instructed to keep this Mutual and General Release of All Claims
confidential; or, (vi) to enforce the terms of this Mutual and General Release
of All Claims.
The parties hereto consent to the jurisdiction of the Los Angeles Superior
Court (Central District) of the State of California, and/or the United States
District Court, Central District of California, Los Angeles office, and hereby
waive any and all venue and jurisdictional objections, whether personal or
subject matter, thereto, and also consents to service of process by any means
authorized pursuant to California law.
This Agreement shall be construed and enforced according to the laws of
the State of California applicable to agreements made to be performed wholly
within the State.
BY THEIR SIGNATURES BELOW, THE UNDERSIGNED REPRESENT THAT THEY HAVE READ THE
FOREGOING FOUR PAGES OF THIS MUTUAL AND GENERAL RELEASE OF ALL CLAIMS AND FULLY
UNDERSTAND AND AGREE TO EACH AND ALL OF THE TERMS AND CONDITIONS SET FORTH
THEREIN.
CYTRX CORPORATION MADISON & WALL WORLDWIDE, INC.
BY: /s/ STEVEN KRIEGSMAN BY: /s/ BRUCE E. ELLIOTT
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STEVEN KRIEGSMAN
PRINT NAME: Bruce E. Elliott
TITLE: President
TITLE: President
DATED: 6/29/04
DATED: May 27, 2004
APPROVED AS TO FORM AND CONTENT:
WASSERMAN, COMDEN, CASSELMAN & PEARSON LLP GREENBERG TRAURIG, P.A.
BY: /s/ CLIFFORD H. PEARSON BY: /s/ DAVID S. OLIVER
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CLIFFORD H. PEARSON DAVID S. OLIVER
Attorneys for Defendant CYTRX CORPORATION Attorneys for Plaintiff MADISON
& WALL WORLDWIDE, INC.
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