SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
(Rule 13d-101)
Under the Securities Exchange Act of 1934
(Amendment No. 1)
(Amended and Restated pursuant to Rule 101(a)(2)(ii)
under Regulation S-T)
GENTA INCORPORATED
- --------------------------------------------------------------------------------
(Name of Issuer)
Common Stock, par value $0.001 per share
- --------------------------------------------------------------------------------
(Title of Class of Securities)
37245M108
- --------------------------------------------------------------------------------
(CUSIP Number)
Stephen E. Jacobs, Esq.
Weil, Gotshal & Manges LLP
767 Fifth Avenue
New York, New York 10153
(212) 310-8000
- --------------------------------------------------------------------------------
(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications)
March 3, 1997
- --------------------------------------------------------------------------------
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(b)(3) or (4), check the following box [ ].
Note: Six copies of this statement, including all exhibits, should be
filed with the Commission. See Rule 13d-1(a) for other parties to whom copies
are to be sent.
NOTE: THIS AMENDMENT NO. 1 TO SCHEDULE 13D IS BEING FILED AS AN AMENDED AND
RESTATED SCHEDULE 13D PURSUANT TO RULE 101(a)(2)(ii) UNDER REGULATION S-T.
1
<PAGE>
13D
CUSIP No. 37245M108 Page 2 of 11
(1) Name of Reporting Persons
S.S. or I.R.S.
Identification Nos. of Above Persons
Rohit Mojilal Desai
###-##-####
(2) Check the Appropriate Box if a Member of a Group
(a) [ ]
(b) [X]
(3) SEC Use Only
(4) Source of Funds
AF
(5) Check if Disclosure of Legal Proceedings is Required Pursuant to
Items 2(d) or 2(e) [ ]
(6) Citizenship or Place of Organization
USA
Number of (7) Sole Voting Power 0 shares
Shares Bene-
ficially (8) Shared Voting Power 3,413,780 shares
Owned by
Each Report- (9) Sole Dispositive Power 0 shares
ing Person
With (10) Shared Dispositive Power 3,413,780 shares
(11) Aggregate Amount Beneficially Owned by Each Reporting Person
3,413,780 shares
(12) Check if the Aggregate Amount in Row (11) Excludes Certain
Shares []
(13) Percent of Class Represented by Amount in Row (11)
8.5%
(14) Type of Reporting Person (See Instructions)
IN
<PAGE>
13D
CUSIP No. 37245M108 Page 3 of 11
(1) Name of Reporting Persons
S.S. or I.R.S. Identification Nos. of Above Persons
Desai Capital Management Incorporated
13-3229933
(2) Check the Appropriate Box if a Member of a Group
(a) [ ]
(b) [X]
(3) SEC Use Only
(4) Source of Funds
AF
(5) Check if Disclosure of Legal Proceedings is Required Pursuant to
Items 2(d) or 2(e) [ ]
(6) Citizenship or Place of Organization
New York
Number of (7) Sole Voting Power 0 shares
Shares Bene-
ficially (8) Shared Voting Power 3,413,780 shares
Owned by
Each Report- (9) Sole Dispositive Power 0 shares
ing Person
With (10) Shared Dispositive Power 3,413,780 shares
(11) Aggregate Amount Beneficially Owned by Each Reporting Person
3,413,780 shares
(12) Check if the Aggregate Amount in Row (11) Excludes Certain
Shares [ ]
(13) Percent of Class Represented by Amount in Row (11)
8.5%
(14) Type of Reporting Person (See Instructions)
IA, CO
<PAGE>
Page 4 of 11
This Amendment No. 1 amends and restates in its entirety the Schedule
13D, dated September 24, 1993 (the "Initial Schedule 13D"), filed by Desai
Capital Management Incorporated and Mr. Rohit M. Desai relating to the common
stock of Genta Incorporated.
ITEM 1. SECURITY AND ISSUER.
This statement relates to the common stock, $0.001 par value (the
"Common Stock"), of Genta Incorporated (the "Company"). The address of the
Company's principal executive office is 3550 General Atomics Court, San Diego,
California 92121.
ITEM 2. IDENTITY AND BACKGROUND.
This statement is filed by Desai Capital Management Incorporated
("DCMI") and Rohit M. Desai, each of whom may be deemed to be the beneficial
owner of the securities owned directly by Equity-Linked Investors, L.P.
("ELI-I") and Equity-Linked Investors-II ("ELI-II").
ELI-I and ELI-II are New York limited partnerships whose principal
business is investing in a portfolio of equity and equity-related securities.
Rohit M. Desai Associates ("RMDA-I") is a New York general
partnership and is the general partner of ELI-I. Rohit M. Desai Associates-II
("RMDA-II") is a New York general partnership and is the general partner of
ELI-II. RMDA-I has no business activities other than acting as ELI-I's general
partner. RMDA-II has no business activities other than acting as ELI-II's
general partner. The partners of RMDA-I and RMDA-II are Rohit M. Desai,
Katharine B. Desai and the Rohit M. Desai Family Trust (of which Katharine B.
Desai and Joseph F. McDonald are the trustees under a trust agreement dated July
1, 1987).
DCMI is a New York corporation whose principal business is that of an
investment advisor. DCMI acts as an investment advisor to ELI-I and ELI-II. The
sole stockholder of DCMI is Rohit M. Desai. The directors of DCMI are Rohit M.
Desai and Katharine B. Desai. Rohit M. Desai, Katharine B. Desai, Kathy T.
Abramson, Damon H. Ball, Thomas P. Larsen, Timothy R. Kelleher, Frank J. Pados,
Tom W. Perlmutter, Paul A. Blaustein, Catherine K. Janson and Jose L. Rovalino
are officers of DCMI.
The address of the principal business and principal office of DCMI is
540 Madison Avenue, 36th Floor, New York, New York 10022.
The present principal occupation and employment of Rohit M. Desai,
who is a citizen of the United States, is as the president, treasurer and
chairman of the board of directors of DCMI and as the managing general partner
of RMDA-I, the general partner of ELI-I, and as the managing general partner of
RMDA-II, the general partner of ELI-II. The present principal occupation and
employment of Katharine B. Desai, who is a United States citizen, is as the
secretary and director of DCMI. The present principal occupation and employment
of Joseph F. McDonald, who is a United States citizen, is as a member of the law
firm of Morgan, Lewis & Bockius. The present principal occupation and employment
of Frank J. Pados, who is a United States citizen, is as executive vice
president of DCMI. The present principal occupation and employment of Catherine
K. Janson, who is a United States citizen, is as vice president of DCMI. The
present principal occupation and employment of Tom W. Perlmutter, who is a
United States citizen, is as vice president of DCMI. The present principal
occupation and employment of Paul A. Blaustein, who is a United States citizen,
is as vice president of DCMI. The present principal occupation and employment of
Kathy T.
<PAGE>
Page 5 of 11
Abramson, who is a United States citizen, is as vice president of DCMI. The
present principal occupation and employment of Damon H. Ball, who is a United
States citizen, is as senior vice president of DCMI. The present principal
occupation and employment of Thomas P. Larsen, who is a United States citizen,
is as senior vice president of DCMI. The present principal occupation and
employment of Timothy R. Kelleher, who is a United States citizen, is as vice
president of DCMI. The present principal occupation and employment of Jose L.
Rovalino, who is a United States citizen, is as assistant vice president of
DCMI. The business address of each of these individuals, except Joseph F.
McDonald, is the same as that of DCMI. The business address of Joseph F.
McDonald is c/o Morgan, Lewis & Bockius, 101 Park Avenue, New York, New York
10178.
Since March 3, 1992, none of DCMI, Rohit M. Desai, Katharine B.
Desai, the Rohit M. Desai Family Trust, Joseph F. McDonald, Kathy T. Abramson,
Damon H. Ball, Thomas P. Larsen, Timothy R. Kelleher, Frank J. Pados, Tom W.
Perlmutter, Paul A. Blaustein, Jose L. Rovalino and Catherine K. Janson has been
convicted in a criminal proceeding (excluding traffic violations or similar
misdemeanors). Since March 3, 1992, none of DCMI, Rohit M. Desai, Katharine B.
Desai, the Rohit M. Desai Family Trust, Joseph F. McDonald, Kathy T. Abramson,
Damon H. Ball, Thomas P. Larsen, Timothy R. Kelleher, Frank J. Pados, Tom W.
Perlmutter, Paul A. Blaustein, Jose L. Rovalino and Catherine K. Janson has been
a party to a civil proceeding of a judicial or administrative body of competent
jurisdiction resulting in a judgment, decree or final order enjoining future
violations of, or prohibiting or mandating activities subject to, federal or
state securities laws or a finding of any violation with respect to such laws.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
On September 24, 1993, ELI-I and ELI-II each acquired (i) 70,000
shares of the Company's Series A Convertible Preferred Stock, $0.001 par value
(the "Series A Preferred Stock"), and (ii) Common Stock Purchase Warrants (the
"Warrants") which may be exercised to purchase up to 70,000 shares of Common
Stock, subject to adjustment. In making these purchases, ELI-I used working
capital from its operating account, which is funded by capital contributions
from ELI-I's limited partners and gains and proceeds from ELI-I's investment
portfolio, and ELI-II used working capital from its operating account, which is
funded by capital contributions from ELI-II's limited partners and gains and
proceeds from ELI-II's investment portfolio.
If the ELI Offer (as described in Item 4 below) is accepted and the
transactions contemplated thereby are consummated, ELI-I will use working
capital from its operating account, which is funded by capital contributions
from ELI-I's limited partners and gains and proceeds from ELI-I's investment
portfolio, and ELI-II will use working capital from its operating account, which
is funded by capital contributions from ELI-II's limited partners and gains and
proceeds from ELI-II's investment portfolio, to fund the transactions
contemplated by the ELI Offer.
ITEM 4. PURPOSE OF TRANSACTION.
On September 2, 1993, DCMI purchased 3,000 shares of Common Stock
(2,400 shares for its own account and 600 shares for the Individually Managed
Account) in the ordinary course of DCMI's business.
On September 24, 1993, ELI-I and ELI-II purchased the Series A
Preferred Stock and the Warrants in the ordinary course of their respective
businesses solely for investment purposes. This acquisition was promptly
reported by the filing of the Initial Schedule 13D. At the time of the filing of
the Initial Schedule 13D, neither DCMI nor Rohit M. Desai had any plans or
proposals which related to or would result in:
<PAGE>
Page 6 of 11
(a) the acquisition by any person of additional securities of the Company
or the disposition of securities of the Company, except that ELI-I,
ELI-II, and/or DCMI may, from time to time, in furtherance of ELI-I's
and ELI-II's respective investment programs, obtain one or more
shares of Common Stock through the conversion of the Series A
Preferred Stock and/or acquire (for investment purposes) or dispose
of the Series A Preferred Stock, Common Stock or any other securities
of the Company;
(b) an extraordinary corporate transaction, such as a merger,
reorganization or liquidation, involving the Company or any of its
subsidiaries;
(c) a sale or transfer of a material amount of assets of the Company or
any of its subsidiaries;
(d) any change in the present Board of Directors or management of the
Company, including any plans or proposals to change the number or
term of directors or to fill any existing vacancies on the Board of
Directors;
(e) any material change in the present capitalization or dividend policy
of the Company;
(f) any other material change in the Company's business or corporate
structure;
(g) any change in the Company's charter or by-laws;
(h) causing a class of securities of the Company to be delisted from a
national securities exchange or to cease to be authorized to be
quoted in an inter-dealer quotation system of a registered national
securities association;
(i) a class of equity securities of the Company becoming eligible for
termination of registration pursuant to Section 12(g)(4) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"); or
(j) any action similar to those enumerated above.
On March 3, 1997, pursuant to an offer (the "ELI Offer") contained in
a letter of the same date, ELI-I and ELI-II expressed their willingness to
purchase securities of the Company in order to fund the Company's operations on
terms and conditions identical to those contained in certain agreements (the
"Aries Agreements") among the Company, The Aries Fund (the "Aries Fund") and The
Aries Domestic Fund, L.P. ("Aries Domestic" and together with the Aries Fund,
"Aries"). The Aries Agreements include (i) a Note and Warrant Purchase
Agreement, dated as of January 28, 1997, between the Company and Aries (the
"Note and Warrant Purchase Agreement"), (ii) Senior Secured Convertible Bridge
Notes, dated January 28, 1997, made by the Company in favor of Aries, (iii)
Class A and Class B Bridge Warrants for the Purchase of Shares of Common Stock,
dated January 28, 1997, between the Company and Aries, (iv) a Security
Agreement, dated as of January 28, 1997, between the Company and Paramount
Capital, Inc. and (v) a Certificate of Designation of Series D Convertible
Preferred Stock of the Company (the "Series D Preferred Stock"), dated February
6, 1997.
The ELI Offer is in the amount of $3,600,000 and is conditioned upon
certain limited due diligence and the judicial rescission of the transactions
contemplated by the Aries Agreements.
<PAGE>
Page 7 of 11
Pursuant to a Letter Agreement, dated March 3, 1997 (the "Froley Revy
Agreement"), among ELI-I, ELI-II and Froley Revy Investment Co., Inc. ("Froley
Revy"), Froley Revy has agreed to participate, on a pro rata basis, with ELI-I
and ELI-II in the transactions contemplated by the ELI Offer (ELI-I, ELI-II and
Froley Revy are hereinafter referred to collectively as the "Offerors"). Such
pro-rata participation will be based upon Froley Revy's holdings of Series A
Preferred Stock.
If the ELI Offer is accepted and the transactions contemplated
thereby are consummated, the Offerors would receive, in the aggregate,
convertible secured bridge notes of the Company convertible at any time into
600,000 shares of Series D Preferred Stock. The Series D Preferred Stock would
be convertible into 20 million, and, upon default, up to 300 million, shares of
Common Stock. In addition, the Offerors would receive, in the aggregate,
warrants for an additional 20 million shares of Common Stock. Pursuant to
Section 7.20 of the Note and Warrant Purchase Agreement, the Offerors would have
the right to appoint a majority of the members of the Board of Directors of the
Company; provided, however, that in the event the Company has not obtained
Future Financings (as defined in the Note and Warrant Purchase Agreement) in
excess of $3,500,000 on or before the date which is six months after the Bridge
Closing Date (as defined in the Note and Warrant Purchase Agreement), then the
Offerors would have the contractual right to appoint only two directors or
observers and, if additional directors have been appointed, such directors are
required to resign.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER.
ELI-I and ELI-II directly own 68,200 and 68,800 shares, respectively,
of Series A Preferred Stock which are convertible into approximately 2,919,470
shares of Common Stock, in the aggregate, and Warrants which, if exercised,
could enable each of ELI-I and ELI-II to directly own approximately 70,000
shares of Common Stock. In addition, 176,379 and 177,931 shares of Common Stock
are held by ELI-I and ELI-II, respectively. For purposes of this Amended and
Restated Schedule 13D, each of DCMI and Rohit M. Desai could be deemed to be a
beneficial owner of the securities of the Company held by ELI-I and ELI-II. The
combined total of such holdings, together with Common Stock held directly by
DCMI, is 3,413,780 shares of Common Stock (after conversion of the Series A
Preferred Stock and exercise of the Warrants), which would constitute beneficial
ownership of approximately 8.5% of the 39,991,626 shares of Common Stock
outstanding as of March 1, 1997.
The power to vote, to convert or to dispose of, or to direct the
voting, conversion, or disposal of, any Common Stock that might be obtained upon
the exercise of the Warrants or conversion of the Series A Preferred Stock held
by ELI-I is vested in RMDA-I as general partner of ELI-I, but such decisions
(and similar decisions with respect to ELI-I's investment portfolio) may also be
made by DCMI under an investment and advisory agreement between ELI-I and DCMI.
The power to vote, to convert or to dispose of, or to direct the voting,
conversion, or disposal of, any Common Stock that might be obtained upon the
exercise of the Warrants or conversion of the Series A Preferred Stock held by
ELI-II is vested in RMDA-II as general partner of ELI-II, but such decisions
(and similar decisions with respect to ELI-II's investment portfolio) may also
be made by DCMI under an investment and advisory agreement between ELI-II and
DCMI. Rohit M. Desai is the managing general partner of RMDA-I and RMDA-II and
the sole stockholder, chairman of the board, president and treasurer of DCMI.
Katharine B. Desai is the secretary and director of DCMI, a general partner of
RMDA-I and RMDA-II and a trustee of the Rohit M. Desai Family Trust. The Rohit
M. Desai Family Trust is a general partner of RMDA-I and RMDA-II. Joseph F.
McDonald is a trustee of the Rohit M. Desai Family Trust. Frank J. Pados is an
executive vice president of DCMI. Damon H. Ball and Thomas P. Larsen are senior
vice presidents. Kathy T. Abramson, Tom W. Perlmutter, Paul A. Blaustein,
Timothy R. Kelleher and Catherine K. Janson are vice presidents. Jose L.
Rovalino is an assistant vice president of DCMI.
<PAGE>
Page 8 of 11
Accordingly, for purposes of this Amended and Restated Schedule 13D,
DCMI and Rohit M. Desai may each be deemed to share the power to vote, or to
direct the vote, and dispose of, or to direct the disposition of, the securities
of the Company held by ELI-I, ELI-II and DCMI.
Pursuant to Rule 13d-4 under the Exchange Act, DCMI, RMDA-I, RMDA-II,
Rohit M. Desai, Katharine B. Desai, the Rohit M. Desai Family Trust, Joseph F.
McDonald, Kathy T. Abramson, Damon H. Ball, Thomas P. Larsen, Timothy R.
Kelleher, Frank J. Pados, Tom W. Perlmutter, Paul A. Blaustein, Jose L. Rovalino
and Catherine K. Janson hereby declare that the filing of this Amended and
Restated Schedule 13D shall not be construed as an admission that any person
other than ELI-I and ELI-II is the beneficial owner of any securities of the
Company covered by this Amended and Restated Schedule 13D, or that any of ELI-I
and ELI-II is the beneficial owner of any securities of the Company held by the
other.
No other person is known to have the right to receive, or the power
to direct the receipt of, dividends from, or the proceeds from the sale of, the
securities of the Company covered by this Amended and Restated Schedule 13D.
During the sixty days preceding the filing of this Amended and
Restated Schedule 13D, none of ELI-I, ELI-II, DCMI and Rohit M. Desai have
engaged in any transactions involving Common Stock.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH
RESPECT TO SECURITIES OF THE ISSUER.
None of DCMI, Rohit M. Desai, Katharine B. Desai, the Rohit M. Desai
Family Trust, Joseph F. McDonald, Kathy T. Abramson, Damon H. Ball, Thomas P.
Larsen, Timothy R. Kelleher, Frank J. Pados, Tom W. Perlmutter, Paul A.
Blaustein, Jose L. Rovalino and Catherine K. Janson is a party to any contract,
arrangement, understanding or relationship specifically relating to any
securities of the Company.
ELI-I and ELI-II are parties to the Unit Purchase Agreements, dated
as of September 23, 1993, between the Company and each of ELI-I and ELI-II,
respectively, and other related documents, regarding the purchase of Series A
Preferred Stock and the Warrants (and related matters such as registration
rights and transfer restrictions).
ELI-I and ELI-II have each contracted with DCMI for DCMI to provide
investment advisory and other services to each of ELI-I and ELI-II. Pursuant to
their respective investment and advisory contracts, DCMI may exercise investment
power and voting power with respect to the investment portfolios of ELI-I and
ELI-II. For its services under these investment and advisory agreements, DCMI
receives a management fee from each of ELI-I and ELI-II based on the value of
their respective portfolios.
ELI-I and ELI-II are parties to the Froley Revy Agreement (described
in Item 4 above).
<PAGE>
Page 9 of 11
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS
1. Joint Filing Agreement.
2. Investment and Advisory Agreement between ELI-I and DCMI, as
amended.
3. Investment and Advisory Agreement between ELI-II and DCMI.
4. Power-of-Attorney authorizing Kathy T. Abramson to sign on behalf
of Rohit M. Desai.
5. Unit Purchase Agreement between the Company and ELI-I.
6. Unit Purchase Agreement between the Company and ELI-II.
7. Letter, dated March 3, 1997, from ELI-I and ELI-II to the
Company, et al.
8. Letter Agreement, dated March 3, 1997, among ELI-I, ELI-II and
Froley Revy.
9. Press Release, dated March 3, 1997.
<PAGE>
Page 10 of 11
SIGNATURES
After reasonable inquiry and to the best of their respective
knowledge and belief, each of the undersigned certifies that the information set
forth in this statement is true, complete and correct as of March 20, 1997.
DESAI CAPITAL MANAGEMENT INCORPORATED
By:/s/ Kathy T. Abramson
-----------------------
Kathy T. Abramson
Attorney-in-fact for
Rohit M. Desai, President
ROHIT M. DESAI
By:/s/ Kathy T. Abramson
-----------------------
Kathy T. Abramson
Attorney-in-fact for
Rohit M. Desai
<PAGE>
Page 11 of 11
INDEX TO EXHIBITS
EXHIBIT
NUMBER DESCRIPTION
1. Joint Filing Agreement.*
2. Investment and Advisory Agreement between ELI-I and DCMI.*
3. Investment and Advisory Agreement between ELI-I and DCMI.*
4. Power-of-Attorney.*
5. Unit Purchase Agreement between the Company and ELI-I.*
6. Unit Purchase Agreement between the Company and ELI-II.*
7. Letter, dated March 3, 1997, from ELI-I and ELI-II to the
Company, et al.**
8. Letter Agreement, dated March 3, 1997, among ELI-I, ELI-II
and Froley Revy.**
9. Press Release, dated March 3, 1997.**
- ----------------------------
* Incorporated by reference to the same document filed as an exhibit to
Schedule 13D, dated September 24, 1993, filed by Rohit M. Desai and DCMI
relating to the common stock of Genta Incorporated.
** Filed herewith.
NYFS11...:\94\10094\0003\1710\FRM3127W.29C
EXHIBIT 7
EQUITY-LINKED INVESTORS, L.P.
EQUITY-LINKED INVESTORS-II
c/o Desai Capital Management Incorporated
540 Madison Avenue
New York, New York 10022
March 3, 1997
Thomas H. Adams, Ph.D. Paul O.O. T'so, Ph.D.
Genta Incorporated John Hopkins University
3550 General Atomics Ct. School of Hygiene and Public Health
Building 9 615 N. Wolfe Street
San Diego, CA 92121 Baltimore, MD 21205
Robert E. Klem, Ph.D. Sharon Webster, Ph.D.
JBL Scientific, Inc. A.A. Global Financial Service Co.
277 Granada Drive 1727 Massachusetts Ave., N.W.
San Louis Obisbo, CA 93401 Suite 602
Washington, DC 20036-2159
Re: Genta Incorporated ("Genta")
----------------------------
The Board of Directors of Genta:
Reference is made to that certain Note and Warrant Purchase Agreement,
dated as of January 28, 1997, by and among Genta, The Aries Fund
("Aries Fund") and The Aries Domestic Fund, L.P. ("Aries Domestic" and
together with Aries Fund, collectively, "Aries"), and related
documentation, including, but not limited to, the Senior Secured
Convertible Bridge Notes, dated January 28, 1997, made by Genta in
favor of Aries, the Class A and Class B Bridge Warrants for the
Purchase of Shares of Common Stock, dated January 28, 1997, between
Genta and Aries, that certain Security Agreement, dated as of January
28, 1997, between Genta and Paramount Capital, Inc., and that certain
Certificate of Designations of Series D Convertible Preferred Stock of
Genta, dated February 6, 1997 (collectively, the "Documents").
Equity-Linked Investors, L.P. and Equity-Linked Investors-II
(collectively, "Equity-Linked") has reviewed the Documents and certain
other publicly available information. Based upon such limited review,
Equity-Linked, together with certain other holders of Genta's Series A
Convertible Preferred Stock, hereby state, subject to certain limited
due diligence, their willingness to fund Genta's operations on terms
and conditions identical to those contained in the Documents (the
"Equity-Linked Offer"). The Equity-Linked Offer is in the amount of
$3,600,000.00, or $600,000.00 greater than the Aries commitment as set
forth in the Documents.
<PAGE>
Board of Directors of Genta
March 3, 1997
Page 2
Please advise the undersigned immediately what steps the Board of
Directors of Genta will take to (i) rescind the transaction, as set
forth in the Documents, with Aries and (ii) accept the Equity-Linked
Offer and enter into documentation with Equity-Linked.
We look forward to your immediate response.
EQUITY-LINKED INVESTORS, L.P.
By: Rohit M. Desai Associates,
general partner
By: /s/ Rohit M. Desai
--------------------------
Name: Rohit M. Desai
Title: General Partner
EQUITY-LINKED INVESTORS-II
By: Rohit M. Desai Associates-
II, a general partner
By: /s/ Rohit M. Desai
---------------------------
Name: Rohit M. Desai
Title: General Partner
NYFS11...:\94\10094\0003\2564\LTR3037L.120
EXHIBIT 8
EQUITY-LINKED INVESTORS, L.P.
EQUITY-LINKED INVESTORS-II
c/o Desai Capital Management Incorporated
540 Madison Avenue
New York, New York 10022
March 3, 1997
James Berry
Froley Revy Investment Co., Inc.
10900 Wilshire Boulevard, Suite 1050
Los Angeles, California 90024
Re: Genta Incorporated ("Genta")
----------------------------
Reference is made to that certain Note and Warrant Purchase Agreement,
dated as of January 28, 1997, by and among Genta, The Aries Fund
("Aries Fund") and The Aries Domestic Fund, L.P. ("Aries Domestic" and
together with Aries Fund, collectively, "Aries"), and related
documentation, including, but not limited to, the Senior Secured
Convertible Bridge Notes, dated January 28, 1997, made by Genta in
favor of Aries, the Class A and Class B Bridge Warrants for the
Purchase of Shares of Common Stock, dated January 28, 1997, between
Genta and Aries, that certain Security Agreement, dated as of January
28, 1997, between Genta and Paramount Capital, Inc., and that certain
Certificate of Designations of Series D Convertible Preferred Stock of
Genta, dated February 6, 1997 (collectively, the "Documents").
This letter serves to confirm our understanding that the you hereby
agree to participate, on a pro-rata basis, with Equity-Linked
Investors, L.P. and Equity-Linked Investors-II (collectively, "Equity-
Linked") and such other holders of Genta's Series A Convertible
Preferred Stock, on the terms and subject to the conditions set forth
in the letter, dated March 3, 1997, from Equity-Linked to the Board of
Directors of Genta, a copy of which is annexed hereto. Such pro-rata
participation shall be predicated upon (i) your existing investment in
Genta's Series A Convertible Preferred Stock and (ii) the amount of
other holders of Genta's Series A Convertible Preferred Stock that
agree to participate.
<PAGE>
March 3, 1997
Page 2
If the foregoing is consistent with your understanding, please execute
this letter in the space provided below.
EQUITY-LINKED INVESTORS, L.P.
By: Rohit M. Desai Associates,
general partner
By: /s/ Rohit M. Desai
---------------------------
Name: Rohit M. Desai
Title: General Partner
EQUITY-LINKED INVESTORS-II
By: Rohit M. Desai Associates-
II, a general partner
By: /s/ Rohit M. Desai
----------------------------
Name: Rohit M. Desai
Title: General Partner
AGREED AND ACCEPTED:
/s/Andrea O'Connell
-----------------------------
Name: Andrea O'Connell
Title: Managing Director
NYFS11...:\94\10094\0003\2564\LTR3037R.020
EXHIBIT 9
FROM: Equity-Linked Investors, L.P.
Equity-Linked Investors-II
c/o Desai Capital Management, Incorporated
540 Madison Avenue
New York, New York 10022
Contact: Mr. Damon Ball (212) 838-9191
Mr. Thomas W. Perlmutter (212) 838-9191
-------------------------------------------------------------------
FOR IMMEDIATE RELEASE
NEW YORK, March 3, 1997 . . . Equity-Linked Investors, L.P. and
Equity-Linked Investors-II today announced that they, and certain
other holders of Genta Incorporated's Series A Convertible Preferred
Stock, had submitted a proposal to the Board of Directors of Genta
Incorporated (NASDAQ SM. CAP.: GNTAC) to lend $3.6 million to Genta
Incorporated on terms and conditions identical to a transaction
entered into between Genta Incorporated and certain entities
controlled by Paramount Capital, Inc., except that Equity-Linked's
offer is for $600,000, or twenty percent (20%), more than Paramount
offered in its transaction.
The transaction between Genta and Equity-Linked is subject to
recission or judicial invalidation of the previously announced
transaction between Genta and Paramount, currently in litigation in
Delaware Chancery Court, as well as certain limited due diligence.
NYFS11...:\94\10094\0003\2564\REL3037M.510
