-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, IQb+TvRCC5O1vuvIoqdTqkAL1b5NuG3efbAdcP0/y5IcOXu/KZ+2MrJyF/d7m/Cs PD61hlncJzeopY87R6FLbg== 0000950144-97-006569.txt : 19970605 0000950144-97-006569.hdr.sgml : 19970605 ACCESSION NUMBER: 0000950144-97-006569 CONFORMED SUBMISSION TYPE: 11-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19961231 FILED AS OF DATE: 19970604 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: CYTRX CORP CENTRAL INDEX KEY: 0000799698 STANDARD INDUSTRIAL CLASSIFICATION: BIOLOGICAL PRODUCTS (NO DIAGNOSTIC SUBSTANCES) [2836] IRS NUMBER: 581642740 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 11-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-15327 FILM NUMBER: 97619036 BUSINESS ADDRESS: STREET 1: 154 TECHNOLOGY PKWY STREET 2: TECHNOLOGY PARK/ATLANTA CITY: NORCROSS STATE: GA ZIP: 30092 BUSINESS PHONE: 4043689500 MAIL ADDRESS: STREET 1: 154 TECHNOLOGY PARKWAY CITY: NORCROSS STATE: GA ZIP: 30092 11-K 1 CYTRX CORPORATION 1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 11-K FOR ANNUAL REPORTS OF EMPLOYEE STOCK PURCHASE, SAVINGS AND SIMILAR PLANS PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 (Mark One) [X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED] For the fiscal year ended December 31, 1996 ----------------- [ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED] For the transition period from to -------- -------- Commission file number 0-15327 ------- A. Full title of the plan and the address of the plan, if different from that of the issuer named below: CYTRX CORPORATION 401(K) PROFIT-SHARING PLAN B. Name of issuer of the securities held pursuant to the plan and the address of its principal executive office: CYTRX CORPORATION 154 Technology Parkway Norcross, Georgia 30092 2 CYTRX CORPORATION 401(K) PROFIT-SHARING PLAN INDEX TO FINANCIAL STATEMENTS AND SUPPLEMENTAL SCHEDULES
Page ---- Report of Independent Auditors 2 Statements of Net Assets Available for Plan Benefits as of December 31, 1996 and 1995 3 Statements of Changes in Net Assets Available for Plan Benefits for the Years Ended December 31, 1996, 1995 and 1994 4 Notes to Financial Statements 6 Signatures 9 Supplemental Schedules: Schedule of Assets Held for Investment Purposes 10 Schedule of Reportable Transactions 11 Exhibit Index 13
3 REPORT OF INDEPENDENT AUDITORS The Trustees of the CytRx Corporation 401(k) Profit-Sharing Plan We have audited the accompanying statements of net assets available for plan benefits of the CytRx Corporation 401(k) Profit-Sharing Plan (the "Plan") as of December 31, 1996 and 1995, and the related statements of changes in net assets available for plan benefits for each of the three years in the period ended December 31, 1996. These financial statements are the responsibility of the Plan's management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the net assets available for plan benefits of the Plan as of December 31, 1996 and 1995, and the changes in net assets available for plan benefits for each of the three years in the period ended December 31, 1996, in conformity with generally accepted accounting principles. Our audits were made for the purpose of forming an opinion on the basic financial statements taken as a whole. The accompanying supplemental Schedule of Assets Held for Investment Purposes as of December 31, 1996 and Schedule of Reportable Transactions for the year ended December 31, 1996 are presented for purposes of complying with the Department of Labor's Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974, and are not a required part of the basic financial statements. The supplemental schedules have been subjected to the auditing procedures applied in the audit of the 1996 financial statements and, in our opinion, are fairly stated in all material respects in relation to the basic 1996 financial statements taken as a whole. ERNST & YOUNG LLP Atlanta, Georgia May 29, 1997 2 4 CYTRX CORPORATION 401(K) PROFIT-SHARING PLAN STATEMENTS OF NET ASSETS AVAILABLE FOR PLAN BENEFITS
Retirement Corporate Basic CytRx Preservation Bond Capital Value Growth Corporation Trust Fund Fund Fund Fund Common Stock Total ------------ ----------- ---------- ---------- ---------- ------------ ---------- DECEMBER 31, 1996 - ----------------- ASSETS Investments at Market Value $ 85,995 $ 18,710 $ 287,784 $ 343,640 $ 224,164 $ 304,463 $1,264,756 Cash & Cash Equivalents 203 -- -- -- -- -- 203 Receivables: Employer contributions -- -- -- -- -- 30,450 30,450 Employee contributions 492 1,267 3,319 5,935 6,999 1,668 19,680 Employee loans 17,480 -- -- -- -- 17,480 Other 13 -- -- -- -- 13 ---------- ---------- ---------- ---------- ---------- ---------- ---------- 17,985 1,267 3,319 5,935 6,999 32,118 67,623 ---------- ---------- ---------- ---------- ---------- ---------- ---------- Total Assets 104,183 19,977 291,103 349,575 231,163 336,581 1,332,582 ---------- ---------- ---------- ---------- ---------- ---------- ---------- LIABILITIES -- -- -- -- -- -- -- ---------- ---------- ---------- ---------- ---------- ---------- ---------- Net Assets Available for Plan Benefits $ 104,183 $ 19,977 $ 291,103 $ 349,575 $ 231,163 $ 336,581 $1,332,582 ========== ========== ========== ========== ========== ========== ========== DECEMBER 31, 1995 ----------------- ASSETS Investments at Market Value $ 59,107 $ 5,837 $ 235,369 $ 253,093 $ 57,744 $ 200,356 $ 811,506 Cash & Cash Equivalents 21,751 -- -- -- -- -- 21,751 Pending Interfund Transfers (7,776) (15) (1,316) 8,826 (524) 805 -- Receivables: Employer contributions -- -- -- -- -- 25,737 25,737 Employee contributions 13,166 1,121 3,795 4,015 10,090 1,204 33,391 Employee loans 7,949 -- -- -- -- -- 7,949 ---------- ---------- ---------- ---------- ---------- ---------- ---------- 21,115 1,121 3,795 4,015 10,090 26,941 67,077 ---------- ---------- ---------- ---------- ---------- ---------- ---------- Total Assets 94,197 6,943 237,848 265,934 67,310 228,102 900,334 ---------- ---------- ---------- ---------- ---------- ---------- ---------- LIABILITIES -- -- -- -- -- -- -- ---------- ---------- ---------- ---------- ---------- ---------- ---------- Net Assets Available for Plan Benefits $ 94,197 $ 6,943 $ 237,848 $ 265,934 $ 67,310 $ 228,102 $ 900,334 ========== ========== ========== ========== ========== ========== ==========
See accompanying notes. 3 5 CYTRX CORPORATION 401(K) PROFIT-SHARING PLAN STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS
Retirement Federal Corporate Preservation Securities Bond Capital Trust Trust Fund Fund ------------ ------------ ---------- ----------- Net assets available for plan benefits December 31, 1993 $ 2,357 $ 7,651 $ -- $ 36,453 Employee contributions 12,475 14,776 -- 110,122 Employer contributions -- -- -- -- Investment income 569 621 -- 10,017 Net appreciation (depreciation) in market value of investments -- (1,044) -- (11,968) Interfund transfers (9,836) (2,412) -- (2,371) Distributions/Withdrawals -- -- -- (652) --------- --------- --------- --------- Net assets available for plan benefits December 31, 1994 5,565 19,592 -- 141,601 Employee contributions 44,038 14,935 6,866 67,176 Employer contributions -- -- -- -- Investment income 1,545 814 109 22,449 Net appreciation (depreciation) in market value of investments -- 2,561 16 30,398 Interfund transfers 43,049 (37,902) (48) (23,018) Forfeitures -- -- -- -- Distributions/Withdrawals -- -- -- (758) --------- --------- --------- --------- Net assets available for plan benefits December 31, 1995 $ 94,197 $ -- $ 6,943 $ 237,848 ========= ========= ========= =========
CytRx Basic Value Growth Corporation Fund Fund Common Stock Total ----------- ----------- ------------ --------- Net assets available for plan benefits December 31, 1993 $ 29,796 $ -- $ 259,662 $ 335,919 Employee contributions 106,258 -- 96,358 339,989 Employer contributions -- -- 107,865 107,865 Investment income 6,220 -- (658) 16,769 Net appreciation (depreciation) in market value of investments (6,871) -- (332,112) (351,995) Interfund transfers 5,687 -- 8,932 -- Distributions/Withdrawals (651) -- (4,427) (5,730) --------- --------- --------- --------- Net assets available for plan benefits December 31, 1994 140,439 -- 135,620 442,817 Employee contributions 59,881 52,916 61,077 306,889 Employer contributions -- -- 138,672 138,672 Investment income 9,296 4,857 2,962 42,032 Net appreciation (depreciation) in market value of investments 44,233 (3,863) (101,031) (27,686) Interfund transfers 13,156 13,400 (8,637) -- Forfeitures -- -- (425) (425) Distributions/Withdrawals (1,071) -- (136) (1,965) --------- --------- --------- --------- Net assets available for plan benefits December 31, 1995 $ 265,934 $ 67,310 $ 228,102 $ 900,334 ========= ========= ========= =========
See accompanying notes. 4 6 CYTRX CORPORATION 401(K) PROFIT-SHARING PLAN STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS
Retirement Federal Corporate Preservation Securities Bond Capital Trust Trust Fund Fund ------------ ------------ ---------- ----------- Net assets available for plan benefits December 31, 1995 $ 94,197 $ -- $ 6,943 $ 237,848 Employee contributions 35,910 -- 17,206 47,933 Employer contributions -- -- -- -- Investment income 5,741 -- 1,182 25,716 Net appreciation (depreciation) in market value of investments -- -- 405 4,438 Interfund transfers (25,525) -- (3,307) (11,518) Forfeitures -- -- -- -- Distributions/Withdrawals (6,140) -- (2,452) (13,314) --------- --------- --------- --------- Net assets available for plan benefits December 31, 1996 $ 104,183 $ -- $ 19,977 $ 291,103 ========= ========= ========= =========
CytRx Basic Value Growth Corporation Fund Fund Common Stock Total ----------- ----------- ------------ --------- Net assets available for plan benefits December 31, 1995 $ 265,934 $ 67,310 $ 228,102 $ 900,334 Employee contributions 69,821 114,542 32,379 317,791 Employer contributions -- -- 143,067 143,067 Investment income 20,221 16,138 -- 68,998 Net appreciation (depreciation) in market value of investments 25,803 24,348 (87,606) (32,612) Interfund transfers (12,405) 23,522 29,233 -- Forfeitures -- -- -- -- Distributions/Withdrawals (19,799) (14,697) (8,594) (64,996) --------- --------- --------- ---------- Net assets available for plan benefits December 31, 1996 $ 349,575 $ 231,163 $ 336,581 $1,332,582 ========= ========= ========= ==========
See accompanying notes. 5 7 CYTRX CORPORATION 401(K) PROFIT-SHARING PLAN NOTES TO FINANCIAL STATEMENTS 1. Description of Plan General The CytRx Corporation 401(k) Profit-Sharing Plan (the "Plan") is a contributory defined contribution plan that covers substantially all employees of CytRx Corporation and its wholly-owned subsidiaries -- Proceutics, Inc., Vaxcel, Inc. and Vetlife, Inc. (collectively referred to herein as "the Company"). The Plan is subject to the provisions of the Employee Retirement Income Security Act of 1974 ("ERISA"). Participants should refer to the Summary Plan Description for the Plan for a more complete description of the Plan's provisions. Contributions Eligible employees may elect to contribute up to 15% of their total compensation on a pre-tax basis, subject to statutory restrictions. In 1996 the maximum salary deferral allowed by the Internal Revenue Service was $9,500. Participants may also elect to contribute additional amounts on an after-tax basis, subject to statutory restrictions. Company matching contributions are made equal to 50% of the participants pre-tax contribution. The Company matching contribution is made in the form of CytRx Corporation common stock. The number of shares of stock contributed to the Plan is determined at the end of each calendar quarter by dividing the total value of the authorized Company matching contribution by the average stock price during the quarter. Vesting Participants are immediately vested in their contributions and earnings thereon. Company contributions are vested in accordance with the following schedule:
Years of Service Vested Percentage ----------------- ----------------- 0 0% 1 33 1/3% 2 66 2/3% 3 100%
Distributions Withdrawals and distributions from the Plan are calculated at the market value of the pro rata shares of the fund to which Participants are entitled. Participants may receive distributions of their vested balances upon termination of employment, disability or attainment of age 59 1/2. Withdrawals are also permitted for financial hardship. 6 8 Forfeitures Forfeitures of unvested account balances by terminating Participants are used to reduce future Company matching contributions. Investment Programs All amounts contributed to the Plan have been deposited with Merrill Lynch Pierce Fenner & Smith, Inc., the Custodian of the Plan. The Plan provides the following funds in which participants can elect to invest their Plan assets: Merrill Lynch Retirement Preservation Trust -- This fund seeks current income, preservation of capital and liquidity available from investing in a diversified portfolio of short-term money market instruments as well as annuity contracts issued by banks and insurance companies. At December 31, 1996 there were 29 Plan participants with balances in this fund. Merrill Lynch Corporate Bond Fund -- High Income Portfolio - This fund seeks as high a level of current income as is consistent with prudent investment management by investing principally in corporate securities which are rated in the lower categories of the established rating services. At December 31, 1996 there were 22 Plan participants with balances in this fund. Merrill Lynch Capital Fund --This fund seeks to achieve the highest total investment return consistent with prudent risk through a fully managed investment policy which permits management of the fund to vary investment in equity, debt, convertible and money market securities based on its evaluation of changes in economic and market trends. At December 31, 1996 there were 49 Plan participants with balances in this fund. Merrill Lynch Basic Value Fund -- This fund seeks capital appreciation and, secondarily, income by investing in securities, primarily equities, that management of the fund believes to be undervalued, especially those selling at a discount from book value or at historically low price/earnings ratios. At December 31, 1996 there were 56 Plan participants with balances in this fund. Merrill Lynch Growth Fund -- This fund seeks long-term capital appreciation by investing in a diversified portfolio of equity securities with principal emphasis on issues believed to be undervalued. At December 31, 1996 there were 52 Plan participants with balances in this fund. CytRx Corporation Common Stock Fund -- Invests solely in common stock of CytRx Corporation. At December 31, 1996 there were 74 Plan participants with balances in this fund. Federal Securities Trust -- This fund seeks a high current return through investments in U.S. Government and Government Agency securities. The Plan discontinued use of this fund during 1995. 7 9 Amendment or Termination The Company intends to continue the Plan indefinitely but reserves the right to terminate it at any time or amend it in any manner it deems advisable. No amendment or termination may reduce any participant's vested interest accrued to the date of such amendment or termination. 2. Summary of Accounting Policies Method of Accounting The financial statements of the Plan have been prepared using the accrual basis of accounting. Participant contributions are recorded as receivables when the related payroll deductions are made for Plan participants. Contributions receivable represent reconciling items between the accompanying financial statements, which are prepared in accordance with generally accepted accounting principles, and the financial information contained in the Plan's Form 5500 filed with the Internal Revenue Service, which is prepared using the cash basis of accounting. Use of Estimates The preparation of the financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates. Investments Investments are stated at market value based on quoted market prices on national exchanges. 3. Administrative Expenses All custodial, record-keeping and trust administration fees and expenses incurred for the benefit of the Plan are paid by the Company. 4. Income Tax Status The Plan has received a favorable determination letter from the Internal Revenue Service indicating that it is qualified under Section 401 of the Internal Revenue Code and that the related trust is tax-exempt under Section 501 of the Internal Revenue Code. Accordingly, the trust's net investment income is exempt from income taxes. The Company is not aware of any actions or series of events that have occurred that might adversely affect the Plan's qualified status. 8 10 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the trustees have duly caused this annual report to be signed by the undersigned hereunto duly authorized. June 3, 1997 CYTRX CORPORATION 401(K) PROFIT-SHARING PLAN /s/ Mark W. Reynolds -------------------------- Mark W. Reynolds Chief Financial Officer CytRx Corporation 9 11 CYTRX CORPORATION 401(K) PROFIT-SHARING PLAN SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES DECEMBER 31, 1996
Market Name of Issuer and Title of Issue Shares Cost Value --------- ----------- ----------- Merrill Lynch Retirement Preservation Trust 85,995 $ 85,995 $ 85,995 Merrill Lynch Corporate Bond Fund 2,336 18,391 18,710 Merrill Lynch Capital Fund 9,448 278,766 287,784 Merrill Lynch Basic Value Fund 11,219 307,344 343,640 Merrill Lynch Growth Fund 9,232 207,238 224,164 CytRx Corporation Common Stock 88,584 458,253 304,463 ---------- ---------- Total Assets Held for Investment $1,355,987 $1,264,756 ========== ==========
10 12 CYTRX CORPORATION 401(K) PROFIT-SHARING PLAN SCHEDULE OF REPORTABLE TRANSACTIONS YEAR ENDED DECEMBER 31, 1996
Current Value of Assets on Cost of Transaction Net Identity of Party Involved Description of Assets Purchases Sales Asset Sold Date Gain (Loss) - -------------------------- ---------------------------------------- --------- -------- ---------- ----------- ----------- Category (iii) - Series of transactions in excess of 5% of plan assets - ---------------------------------------------------------------------- Merrill Lynch Pierce Fenner 70,896 shares & Smith, Inc. CytRx Corporation Common Stock $222,889 $222,889 Merrill Lynch Pierce Fenner 40,513 shares & Smith, Inc. CytRx Corporation Common Stock $162,373 $231,745 $162,373 $(69,372) Merrill Lynch Pierce Fenner 4,077 shares & Smith, Inc. Merrill Lynch Capital Fund $123,496 $123,496 Merrill Lynch Pierce Fenner 2,464 shares & Smith, Inc. Merrill Lynch Capital Fund $ 75,878 $ 72,464 $ 75,878 $ 3,414 Merrill Lynch Pierce Fenner 4,535 shares & Smith, Inc. Merrill Lynch Basic Value Fund $132,868 $132,868 Merrill Lynch Pierce Fenner 2,321 shares & Smith, Inc. Merrill Lynch Basic Value Fund $ 67,775 $ 62,400 $ 67,775 $ 5,375 Merrill Lynch Pierce Fenner 8,666 shares & Smith, Inc. Merrill Lynch Growth Fund $194,876 $194,876 Merrill Lynch Pierce Fenner 2,237 shares & Smith, Inc. Merrill Lynch Growth Fund $ 52,265 $ 48,696 $ 52,265 $ 3,569 Merrill Lynch Pierce Fenner 89,796 shares & Smith, Inc. Merrill Lynch Retirement Preservation Trust $ 89,796 $ 89,796 Merrill Lynch Pierce Fenner 62,908 shares & Smith, Inc. Merrill Lynch Retirement Preservation Trust $ 62,908 $ 62,908 $ 62,908 $ --
11 13 CYTRX CORPORATION 401(K) PROFIT-SHARING PLAN SCHEDULE OF REPORTABLE TRANSACTIONS YEAR ENDED DECEMBER 31, 1996
Current Value of Assets on Cost of Transaction Net Identity of Party Involved Description of Assets Purchases Sales Asset Sold Date Gain (Loss) - -------------------------- ---------------------------------------- --------- -------- ---------- ----------- ----------- Category (iii) - Series of transactions in excess of 5% of plan assets - ---------------------------------------------------------------------- Merrill Lynch Pierce Fenner 433,545 shares & Smith, Inc. Merrill Lynch CMA Money Fund $433,545 $433,545 Merrill Lynch Pierce Fenner 455,049 shares & Smith, Inc. Merrill Lynch CMA Money Fund $455,049 $455,049 $455,049 $ --
Note: Commissions and fees related to purchases and sales of investments are included in the cost of investments or the proceeds from the sale and are not separately identified by the trustee. There were no category (i), (ii) or (iv) reportable transactions during the year ended December 31, 1996. 12 14 CYTRX CORPORATION 401(K) PROFIT-SHARING PLAN FORM 11-K EXHIBIT INDEX
Exhibit Number Description Page - -------------- ----------- ---- 24.1 Consent of Ernst & Young LLP 14
13 EX-24.1 2 CONSENT OF ERNST & YOUNG LLP 1 EXHIBIT 24.1 CONSENT OF INDEPENDENT AUDITORS We consent to the incorporation by reference in the Registration Statement on Form S-8 No. 33-48706 pertaining to the CytRx Corporation 401(k) Profit-Sharing Plan of our report dated May 29, 1997, with respect to the financial statements and supplemental schedules of the CytRx Corporation 401(k) Profit-Sharing Plan, included in this Annual Report (Form 11-K) for the year ended December 31, 1996. Atlanta, Georgia ERNST & YOUNG LLP May 29, 1997 -----END PRIVACY-ENHANCED MESSAGE-----