Unassociated Document
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UNITED
STATES
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SECURITIES
AND EXCHANGE COMMISSION
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WASHINGTON,
D.C. 20549
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FORM
8-K
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CURRENT
REPORT
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PURSUANT
TO SECTION 13 OR 15(d) OF THE
SECURITIES
EXCHANGE ACT OF 1934
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Date
of report (Date of earliest event reported): April
2, 2009
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(Exact
Name of Registrant as Specified in
Charter)
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(State
or Other Jurisdiction
of
Incorporation)
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(Commission
File Number)
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(I.R.S.
Employer
Identification
No.)
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Two
Connell Drive, Berkeley Heights, NJ
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(Address
of Principal Executive Offices)
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(Zip
Code)
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(908) 286-9800
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(Registrant’s
telephone number, including area code)
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(Former
Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the
Form 8-K filing is intended to simultaneously satisfy the filing obligation of
the registrant under any of the following provisions (see General Instruction A.2.
below):
¨ Written communications
pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
¨ Soliciting material
pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
¨ Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
¨ Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
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Item
1.01
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Entry
into a Material Definitive
Agreement.
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On April
2, 2009, Genta Incorporated (the “Company”) entered into a securities purchase
agreement (the “Securities Purchase Agreement”) with certain accredited
institutional investors listed on the signature page thereto, to place up to $12
million of senior secured convertible notes (the “2009 Notes”) and corresponding
warrants (the “Warrants”) to purchase common stock with such investors (the
“Financing”). The Company has closed on approximately $6 million of such Notes
and Warrants (the “Initial Closing”) on April 2, 2009.
The 2009
Notes will bear interest at an annual rate of 8% payable semi-annually in other
senior secured convertible promissory notes (“Other Notes”) to the holder, and
will be convertible into shares of the Company’s common stock at a conversion
rate of 500,000 shares of common stock for every $1,000.00 of
principal. Until the earlier of three years from the Initial Closing
or three months after the Company receives United States or European approval of
Genasense, the holders of the 2009 Notes have the right, but not the obligation,
to purchase in whole or in part the remaining approximately $6 million of
principal amount of the 2009 Notes. The Company shall have the right
to force conversion of the 2009 Notes in whole or in part if the daily volume
weighted average price of the Company’s common stock exceeds $0.20 for a period
of 20 consecutive trading days. Pursuant to an amended and restated
general security agreement (the “Security Agreement”), the 2009 Notes are
secured by a first lien on all assets of the Company, subject to certain
exceptions set forth in the Security Agreement. The 2009 Notes
include certain events of default, including a requirement that the Company
effect a reverse stock split of the Company’s Common Stock within 105 days of
the Initial Closing. There are currently not enough shares of common
stock authorized under the Company’s certificate of incorporation to cover the
shares underlying the 2009 Notes.
As
previously disclosed, in June 2008, the Company entered into a securities
purchase agreement with certain institutional and accredited investors listed on
the signature page thereto (“2008 Investors”) to place up to $40 million of
senior secured convertible notes (the “2008 Notes”) to purchase common stock
with such investors (the “2008 Financing”). In connection with the
2009 Notes, the Company entered into a consent agreement (the “Consent
Agreement”) with the 2008 Investors under which the 2008 Investors, among other
things, (i) consented to the Financing and certain other events; (ii) agreed to
receive interest payments under the 2008 Notes in the form of additional 2008
Notes; (iii) agreed to a limitation on their right to convert the 2008 Notes;
and (iv) agreed that the security interest granted in connection with the
current Financing will be in parity with the security interest granted in
connection with the 2008 Financing. In exchange for the foregoing
agreements, the Company granted the 2008 Investors the right to purchase 2009
Notes equal to the principal amount of the 2008 Notes currently held by such
2008 Investors (the “Purchase Rights”) and a right of first refusal to
participate in a future financing of the Company that meets criteria specified
in the Consent Agreement. In addition, the Company agreed to refrain
from taking certain actions specified in the Consent Agreement without the
consent of the 2008 Investors. If the Company breaches its
obligations under the Consent Agreement, it will be obligated, at the request of
any 2008 Investor, to repurchase such investor’s outstanding Purchase Right at a
premium described in the Consent Agreement.
Rodman
& Renshaw, LLC, a wholly-owned subsidiary of Rodman & Renshaw Capital
Group, Inc. served as the exclusive placement agent for the
offering.
The 2009
Notes and the Warrants offered and the common stock issuable upon conversion of
the 2009 Notes, or upon exercise of the Warrants, have not been registered under
the Securities Act of 1933, as amended, or any state securities laws, and may
not be offered or sold in the United States absent an effective registration
statement or an applicable exemption from registration
requirements.
The
Company intends to attach a complete copy of each of the form of senior secured
convertible note, the Securities Purchase Agreement, the Security Agreement, the
Consent Agreement and related documents of the Company to an amended Form 8-K to
be filed before April 6, 2009. The foregoing description of the
Financing, and any other documents or filings referenced herein, are qualified
in their entirety by reference to such exhibits, documents or
filings.
The
Company issued a press release on April 2, 2009 to announce the
Financing. A copy of the press release is filed herewith as Exhibit
99.1.
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Item
3.02
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Unregistered
Sale of Equity Securities
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See Item
1.01.
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Item
9.01
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Financial
Statements and
Exhibits.
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(d)
Exhibits.
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99.1
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Press Release of the Company
issued on April 2, 2009 announcing the
Financing.
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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 hereunto
duly authorized.
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GENTA
INCORPORATED
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By:
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/s/ Gary Siegel
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Gary
Siegel
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Vice
President, Finance (Principal Financial and Accounting Officer) and
Interim Corporate
Secretary
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Dated:
April 3, 2009