SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. 5)*
Genta Incorporated
(Name of Issuer)
Common Stock, par value $.001 per share
(Title of Class of Securities)
372 45 M 20 7
(CUSIP Number)
Paramount Capital Asset Management, Inc.
c/o Lindsay A. Rosenwald, M.D.
787 Seventh Avenue
New York, NY 10019
(212) 554-4300
with a copy to:
David R. Walner, Esq. Monica C. Lord, Esq.
Paramount Capital Asset Kramer, Levin,
Management, Inc. Naftalis & Frankel
787 Seventh Avenue 919 Third Avenue
New York, NY 10019 New York, NY 10022
(212) 554-4372 (212) 715-9100
(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications)
July 27, 1998
(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:
|-|
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.
*The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
Page 1 of 11 Pages
<PAGE>
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CUSIP No. 372 45 M 20 7 13D Page 2 of 11 Pages
- --------------------------------------------------------------------------------
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1 NAMES OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Paramount Capital Asset Management, Inc.
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) |_|
(b) |_|
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
OO (see Item 3)
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEM 2(d) or 2(e)
|-|
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
- --------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER
SHARES
BENEFICIALLY None
OWNED BY ------------------------------------------
EACH 8 SHARED VOTING POWER
REPORTING
PERSON 15,332,946
WITH ------------------------------------------
9 SOLE DISPOSITIVE POWER
None
------------------------------------------
10 SHARED DISPOSITIVE POWER
15,332,946
- --------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
15,332,946
- --------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN SHARES*
|_|
- --------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
69.2% (41.0% of the outstanding voting power)**
- --------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
CO
- --------------------------------------------------------------------------------
** The outstanding shares of Series D Preferred Stock of the Issuer are entitled
to vote together with the holders of Common Stock on all matters submitted to a
vote of stockholders of the Issuer. As of July 27, 1998, Paramount Capital Asset
Management, Inc. may be deemed beneficially to own (within the meaning of Rule
13d-3 under the Securities Exchange Act of 1934, as amended) 41.0% of the
aggregate voting power of the Common Stock and Series D Preferred Stock
outstanding.
<PAGE>
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CUSIP No. 372 45 M 20 7 13D Page 3 of 11 Pages
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
1 NAMES OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Aries Domestic Fund, L.P.
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) |_|
(b) |_|
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
OO (see Item 3)
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEM 2(d) or 2(e)
|-|
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
- --------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER
SHARES
BENEFICIALLY None
OWNED BY ------------------------------------------
EACH 8 SHARED VOTING POWER
REPORTING
PERSON 5,326,417
WITH ------------------------------------------
9 SOLE DISPOSITIVE POWER
None
------------------------------------------
10 SHARED DISPOSITIVE POWER
5,326,417
- --------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
5,326,417
- --------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN SHARES*
|_|
- --------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
24.0% (14.2% of the outstanding voting power)**
- --------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
PN
- --------------------------------------------------------------------------------
** The outstanding shares of Series D Preferred Stock of the Issuer are entitled
to vote together with the holders of Common Stock on all matters submitted to a
vote of stockholders of the Issuer. As of July 27, 1998, the Aries Domestic
Fund, L.P. may be deemed beneficially to own (within the meaning of Rule 13d-3
under the Securities Exchange Act of 1934, as amended) 14.2% of the aggregate
voting power of the Common Stock and Series D Preferred Stock outstanding.
<PAGE>
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CUSIP No. 372 45 M 20 7 13D Page 4 of 11 Pages
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1 NAMES OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
The Aries Trust
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) |_|
(b) |_|
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3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
OO (see Item 3)
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEM 2(d) or 2(e)
|-|
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Cayman Islands
- --------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER
SHARES
BENEFICIALLY None
OWNED BY ------------------------------------------
EACH 8 SHARED VOTING POWER
REPORTING
PERSON 10,006,529
WITH ------------------------------------------
9 SOLE DISPOSITIVE POWER
None
------------------------------------------
10 SHARED DISPOSITIVE POWER
10,006,529
- --------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
10,006,529
- --------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN SHARES*
|_|
- --------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
45.1% (26.8% of the outstanding voting power)**
- --------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON* OO (see Item 2)
- --------------------------------------------------------------------------------
** The outstanding shares of Series D Preferred Stock of the Issuer are entitled
to vote together with the holders of Common Stock on all matters submitted to a
vote of stockholders of the Issuer. As of July 27, 1998, The Aries Trust may be
deemed beneficially to own (within the meaning of Rule 13d-3 under the
Securities Exchange Act of 1934, as amended) 26.8% of the aggregate voting power
of the Common Stock and Series D Preferred Stock outstanding.
<PAGE>
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CUSIP No. 372 45 M 20 7 13D Page 5 of 11 Pages
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1 NAMES OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Lindsay A. Rosenwald, M.D.
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) |_|
(b) |_|
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
OO (see Item 3)
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(d) or 2(e)
|-|
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States
- --------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER
SHARES
BENEFICIALLY 822,491**
OWNED BY ------------------------------------
EACH 8 SHARED VOTING POWER
REPORTING
PERSON 15,332,946
WITH ------------------------------------
9 SOLE DISPOSITIVE POWER
822,491**
------------------------------------
10 SHARED DISPOSITIVE POWER
15,332,946
- --------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
16,155,437**
- --------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES*
|_|
- --------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
72.9% (43.2% of the outstanding voting power)***
- --------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
IN
- --------------------------------------------------------------------------------
** Does not include approximately 1,951,801 and 92,101 shares of Common Stock
issuable, respectively, upon conversion and exercise of approximately 18,420
shares of Series D Preferred Stock and Class D Warrants issuable upon exercise
of Advisory Warrants, which are not exercisable within 60 days of July 27, 1998.
*** The outstanding shares of Series D Preferred Stock of the Issuer are
entitled to vote together with the holders of Common Stock on all matters
submitted to a vote of stockholders of the Issuer. As of July 27, 1998, Lindsay
A. Rosenwald, M.D. may be deemed beneficially to own (within the meaning of Rule
13d-3 under the Securities Exchange Act of 1934, as amended) 43.2% of the
aggregate voting power of the Common Stock and Series D Preferred Stock
outstanding.
<PAGE>
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CUSIP No. 372 45 M 20 7 13D Page 6 of 11 Pages
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1 NAMES OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Mr. Michael S. Weiss
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) |_|
(b) [x]
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
PF (see Item 3)
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(d) or 2(e)
|-|
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States
- --------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER
SHARES
BENEFICIALLY 148,354
OWNED BY ----------------------------------------
EACH 8 SHARED VOTING POWER
REPORTING
PERSON None**
WITH ----------------------------------------
9 SOLE DISPOSITIVE POWER
148,354
----------------------------------------
10 SHARED DISPOSITIVE POWER
None**
- --------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
148,354**
- --------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES*
|_|
- --------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
2.4% (0.5% of the outstanding voting power)***
- --------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
IN
- --------------------------------------------------------------------------------
** Does not include approximately 502,993 and 23,735 shares of Common Stock
issuable, respectively, upon conversion and exercise of approximately 4,747
shares of Series D Preferred Stock and Class D Warrants issuable upon exercise
of Advisory Warrants, which are not exercisable within 60 days of July 27, 1998,
that are held by an entity of which Mr. Weiss is the managing member.
*** The outstanding shares of Series D Preferred Stock of the Issuer are
entitled to vote together with the holders of Common Stock on all matters
submitted to a vote of stockholders of the Issuer. As of July 27, 1998, Mr.
Michael S. Weiss may be deemed beneficially to own (within the meaning of Rule
13d-3 under the Securities Exchange Act of 1934, as amended) 0.5% of the
aggregate voting power of the Common Stock and Series D Preferred Stock
outstanding.
<PAGE>
SCHEDULE 13D
This Amendment No. 5 amends and supplements the following Items of the
Reporting Persons' Statement on Schedule 13D, dated February 24, 1997, as
amended to date, (the "Schedule").
ITEM 2. IDENTITY AND BACKGROUND.
The information contained in Item 2 to the Schedule is hereby amended
and supplemented to read in its entirety as follows:
(a) This statement is filed on behalf of Paramount Capital Asset
Management, Inc. ("Paramount Capital"), Aries Domestic Fund, L.P.
("Aries Domestic"), The Aries Trust ("Aries Trust"), Dr. Lindsay A.
Rosenwald (together with Paramount Capital, Aries Domestic and Aries
Trust, the "Aries Reporting Persons") and Mr. Michael S. Weiss
(together with the Aries Reporting Persons, the "Filing Persons"). See
attached Exhibit AA which is a copy of their agreement in writing to
file this statement jointly on behalf of each of them. Mr. Weiss and
the Aries Reporting Persons have made, and will continue to make,
their own investment decisions. The investment decisions of Mr. Weiss
may or may not coincide with the decisions made by the Aries Reporting
Persons. Each Filing Person expressly disclaims Mr. Weiss' membership
in a "group" with the Aries Reporting Persons within the meaning of
Rule 13d-5(b)(1) of the Securities Exchange Act of 1934, as amended.
(b) The business address of Paramount Capital, Aries Domestic, Dr.
Rosenwald and Mr. Weiss is 787 Seventh Avenue, 48th Floor, New York,
New York, 10019. The business address for Aries Trust is c/o
MeesPierson (Cayman) Limited, P.O. Box 2003, British American Centre,
Phase 3, Dr. Roy's Drive, George Town, Grand Cayman.
(c) Dr. Rosenwald is an investment banker, venture capitalist, fund
manager and sole shareholder of Paramount Capital,/1/ a Subchapter S
corporation incorporated in the State of Delaware. Paramount Capital
is the General Partner of Aries Domestic,/2/ a limited partnership
incorporated in Delaware. Paramount Capital is the
- --------
/1/ Please see Exhibit B indicating the executive officers and directors of
Paramount Capital and providing information called for by Items 2-6 of this
statement as to said officers and directors. Exhibit B is herein
incorporated by reference.
/2/ Please see Exhibit C indicating the general partner of Aries Domestic and
the general partner's executive officers and directors and providing
information called for by Items 2-6 of this statement as to said general
partners, officers and directors. Exhibit C is herein incorporated by
reference.
Page 7 of 11 Pages
<PAGE>
Investment Manager to Aries Trust,/3/ a Cayman Islands Trust. Mr.
Weiss is a Senior Managing Director of Paramount Capital, Inc. ("PCI")
and also is a Director and Vice Chairman of the Issuer's Board of
Directors.
(d) Dr. Rosenwald, Mr. Weiss, Paramount Capital, Aries Domestic and Aries
Trust and their respective officers, directors, general partners,
investment managers, and trustees have not, during the five years
prior to the date hereof, been convicted in a criminal proceeding
(excluding traffic violations or similar misdemeanors).
(e) Dr. Rosenwald, Mr. Weiss, Paramount Capital, Aries Domestic and Aries
Trust and their respective officers, directors, general partners,
investment managers, and trustees have not been, during the five years
prior to the date hereof, parties to a civil proceeding of a judicial
or administrative body of competent juris- diction, as a result of
which such person was or is subject to a judgment, decree or final
order enjoining future violations of, or prohibiting or mandating
activities subject to, Federal or State securities laws or finding any
violation with respect to such laws.
(f) Dr. Rosenwald and Mr. Weiss are citizens of the United States.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION
The information contained in Item 3 to the Schedule is hereby amended
by adding the following:
On July 27, 1998, Aries Trust and Aries Domestic entered into a Letter
Agreement whereby they purchased an aggregate of 40,000 shares of Series A
Preferred Stock, from the holder thereof. Aries Trust used $225,000 of its
general funds to purchase 30,000 shares of Series A Preferred Stock, which
shares are convertible into 217,654 shares of Common Stock. Aries Domestic used
$75,000 of its general funds to purchase 10,000 shares of Series A Preferred
Stock, which shares are convertible into 72,551 shares of Common Stock.
ITEM 5. INTEREST IN SECURITIES OF ISSUER.
The information contained in Item 5 to the Schedule is hereby amended
and supplemented to read in its entirety as follows:
(a) As of December 29, 1997: Dr. Rosenwald, as the sole shareholder of
Paramount Capital and as the holder of Placement Warrants and Advisory
- --------
/3/ Please see Exhibit D indicating the investment manager of the Aries Trust
and the investment manager's executive officers and directors and providing
information called for by Items 2-6 of this statement as to said investment
manager and officers and directors. Exhibit D is herein incorporated by
reference.
Page 8 of 11 Pages
<PAGE>
Warrants, may be deemed beneficially to own 16,155,437 shares or 72.9%
of the Issuer's Common Stock; Paramount Capital, through the
acquisitions of securities by Aries Trust and Aries Domestic, may be
deemed beneficially to own 15,332,946 shares or 69.2% of the Issuer's
Common Stock; and Aries Domestic, Aries Trust and Mr. Weiss may be
deemed beneficially to own the following numbers of shares of Common
Stock:
Aries Domestic 5,326,417
Aries Trust 10,006,529
Mr. Weiss 148,354
Pursuant to Rule 13d-4 promulgated under the Securities Exchange Act
of 1934, as amended, the Filing Persons disclaim beneficial ownership
of all the Common Stock except the Purchased Common Stock. Pursuant to
Rule 13d-4 promulgated under the Securities Exchange Act of 1934, as
amended, the Aries Reporting Persons and Mr. Weiss each disclaim
beneficial ownership of all securities held by the other.
The outstanding shares of Series D Preferred Stock of the Issuer are
entitled to vote together with the holders of Common Stock on all
matters submitted to a vote of stockholders of the Issuer. As of July
27, 1998, Dr. Rosenwald and Paramount Capital may be deemed
beneficially to own (within the meaning of Rule 13d-3 under the
Securities Exchange Act of 1934, as amended) 43.2% and 41.0%,
respectively, of the aggregate voting power of the Common Stock and
Series D Preferred Stock outstanding.
(b) Dr. Rosenwald and Paramount Capital share the power to vote or to
direct the vote, to dispose or to direct the disposition of those
shares owned by each of Aries Domestic and Aries Trust. Dr. Rosenwald
has the sole power to vote or to direct the vote and to dispose or to
direct the disposition of the shares underlying the Placement Warrants
and Advisory Warrants held by him. Mr. Weiss has the sole power to
vote or to direct the vote and to dispose or to direct the disposition
of the shares that he owns.
(c) Other than the purchase of Series A Preferred Stock on July 27, 1998
(see Item 3), the Reporting Persons have not engaged in any
transactions in the Common Stock of the Issuer in the past 60 days.
(d)&(e) Not applicable.
Page 9 of 11 Pages
<PAGE>
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT
TO SECURITIES OF THE ISSUER.
The information contained in Item 6 to the Schedule is hereby amended
by adding the following:
On July 27, 1998, Aries Trust and Aries Domestic entered into a Letter
Agreement, pursuant to which Aries Trust and Aries Domestic purchased shares of
Series A Preferred Stock (see Item 3).
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS.
The information contained in Item 7 to the Schedule is hereby amended
by adding the following:
Exhibit AA: Agreement of Joint Filing of Schedule 13D dated as
of July 31, 1998.
Exhibit AB: Letter Agreement between Aries Trust, Aries
Domestic and Highbridge Capital Corporation
relating to the purchase of Series A Preferred
Stock.
Page 10 of 11 Pages
<PAGE>
SIGNATURES
After reasonable inquiry and to the best knowledge and belief of the
undersigned, the undersigned certify that the information set forth in this
statement is true, complete and correct.
PARAMOUNT CAPITAL ASSET MANAGEMENT, INC.
Dated: July 31, 1997
New York, NY By: /s/ Lindsay A. Rosenwald
---------------------------------------
Lindsay A. Rosenwald, M.D.
President
ARIES DOMESTIC FUND, L.P.
By: Paramount Capital Asset Management, Inc.
General Partner
Dated: July 31, 1997
New York, NY By: /s/ Lindsay A. Rosenwald
---------------------------------------
Lindsay A. Rosenwald, M.D.
President
THE ARIES TRUST
By: Paramount Capital Asset Management, Inc.
General Partner
Dated: July 31, 1997
New York, NY By: /s/ Lindsay A. Rosenwald
---------------------------------------
Lindsay A. Rosenwald, M.D.
President
Dated: July 31, 1997
New York, NY By: /s/ Lindsay A. Rosenwald
---------------------------------------
Lindsay A. Rosenwald, M.D.
Dated: July 31, 1997
New York, NY By: /s/ Michael S. Weiss
---------------------------------------
Mr. Michael S. Weiss
Page 11 of 11 Pages
<PAGE>
Exhibit AA
EXHIBIT AA
AGREEMENT
JOINT FILING OF SCHEDULE 13D
The undersigned hereby agree jointly to prepare and file with
regulatory authorities a Schedule 13D and any future amendments thereto
reporting each of the undersigned's ownership of securities of Genta
Incorporated and hereby affirm that such Schedule 13D is being filed on behalf
of each of the undersigned.
PARAMOUNT CAPITAL ASSET MANAGEMENT, INC.
Dated: July 31, 1997
New York, NY By: /s/ Lindsay A. Rosenwald
---------------------------------------
Lindsay A. Rosenwald, M.D.
President
ARIES DOMESTIC FUND, L.P.
By: Paramount Capital Asset Management, Inc.
General Partner
Dated: July 31, 1997
New York, NY By: /s/ Lindsay A. Rosenwald
---------------------------------------
Lindsay A. Rosenwald, M.D.
President
THE ARIES TRUST
By: Paramount Capital Asset Management, Inc.
General Partner
Dated: July 31, 1997
New York, NY By: /s/ Lindsay A. Rosenwald
---------------------------------------
Lindsay A. Rosenwald, M.D.
President
Dated: July 31, 1997
New York, NY By: /s/ Lindsay A. Rosenwald
---------------------------------------
Lindsay A. Rosenwald, M.D.
Dated: July 31, 1997
New York, NY By: /s/ Michael S. Weiss
---------------------------------------
Mr. Michael S. Weiss
<PAGE>
Exhibit AB
July 27, 1998
VIA FACSIMILE 759-6010
- ----------------------
Highbridge Capital Corporation
c/o Highbridge Capital Management, LLC
767 Fifth Avenue
23rd Floor
New York, NY 10153
ATTN: Ron Resnick
Re: Letter Agreement
This letter agreement (the "Agreement") sets forth the entire
understanding among the Aries Fund, a Series of The Aries Trust, a Cayman Island
Trust (the "Trust"), the Aries Domestic Fund, L.P., a Delaware limited
partnership (the "Partnership", and collectively with the Trust, the "Funds" or
the "Purchasers")) and Highbridge Capital Corporation (the "Seller") with
respect to the purchase of an aggregate of 40,000 shares of Series A Preferred
Stock (the "Shares") of Genta Incorporated (the "Company") (together with any
and all rights, claims and causes of action of any kind, known or unknown,
contingent or matured, arising out of or relating to Seller's acquisition,
ownership or sale of such Shares which such Seller has or may have against the
Company, the Funds, Paramount Capital, Inc., Paramount Capital Asset Management,
Inc. or any of their respective present or former officers, directors,
employees, shareholders, affiliates, agents or advisors (other than claims
arising out of this Agreement), if any) by the Funds and from the Seller:
Purchasers: The Aries Fund, a Series of The Aries Trust, a
Cayman Island Trust
The Aries Domestic Fund, L.P., a Delaware limited
partnership
The allocation as between the Trust and the
Partnership is set forth on Schedule A attached
hereto.
Aggregate Price: $300,000
Transaction: Subject to the terms and conditions set forth
herein, the Seller hereby agrees to sell and
transfer to the Purchasers, and the Purchasers
hereby agree to purchase from the Seller for the
Aggregate Price, the Shares (together with any and
all rights, claims and causes of action of any
kind, known or unknown, contingent or matured,
arising out of or relating to Seller's
acquisition, ownership or sale of such Shares
which such Seller has or may have against the
Company, the Funds, Paramount Capital,
<PAGE>
Inc., Paramount Capital Asset Management, Inc. or
any of their respective present or former
officers, directors, employees, shareholders,
affiliates, agents or advisors (other than claims
arising out of this agreement), if any) at the
Closing (as defined below) for the Aggregate Price
set forth above. At such Closing, the Seller, or
its nominee, will deliver to the Funds
certificates for the Shares with duly endorsed
stock powers, against payment of the purchase
price therefor by the Funds, by wire transfer or
certified check, at the Seller's option, payable
to the Seller.
Closing: Shall take place on the date hereof or at such
other time and place as mutually agreed to by the
parties.
Conditions to
Purchasers'sObligations: The obligation of the Purchasers to purchase and
pay for the Shares at the Closing is subject to
the satisfaction on or prior to the date of the
Closing of the following conditions, which may
only be waived by written consent of the
Purchasers:
(a) all of the representations and warranties of
the Seller contained in this Agreement shall be
true and correct at and as of the date of the
Closing with the same effect as if made on the
date of the Closing, except to the extent of
changes caused by the transactions contemplated
hereby;
(b) all of the covenants and agreements of the
Seller contained in this Agreement and required to
be performed on or prior to the date of the
Closing shall have been performed in a manner
satisfactory in all respects to the Purchasers;
(c) no action or proceeding before any court or
governmental body shall be pending or threatened
wherein an unfavorable judgment, decree or order
would prevent the carrying out of this Agreement
or any of the transactions contemplated hereby,
declare unlawful the transactions contemplated by
this Agreement or cause such transactions to be
rescinded; and
(d) the Purchasers shall have received such
certificates, assignments of rights and such other
documents and instruments as the Purchasers may
reasonably request in connection with, and to
effect, the transactions contemplated by this
Agreement.
Conditions to Seller's
Obligations: The obligation of the Seller to sell the Shares to
Purchasers as set forth herein at the Closing is
subject to the satisfaction on or prior to the
date of the Closing of the following conditions,
which may only be waived by written consent of the
Seller:
-2-
<PAGE>
(a) all of the covenants and agreements of the
Purchasers contained in this Agreement and
required to be performed on or prior to the date
of the Closing shall have been performed in a
manner satisfactory in all respects to the Seller;
(b) all of the representations and warranties of
the Purchasers contained in this Agreement shall
be true and correct at and as of the date of the
Closing with the same effect as if made on the
date of the Closing, except to the extent of
changes caused by the transactions contemplated
hereby;
(c) no action or proceeding before any court or
governmental body shall be pending or threatened
wherein an unfavorable judgment, decree or order
would prevent the carrying out of this Agreement
or any of the transactions contemplated hereby,
declare unlawful the transactions contemplated by
this Agreement or cause such transactions to be
rescinded;
Seller's Representations
and Warranties: Seller represents and warranties to the Purchaser
acquiring its shares hereunder as follows:
(a) the Seller has full power and authority to
enter into this Agreement and to perform its
obligations hereunder. This Agreement constitutes
a legal, valid and binding obligation of the
Seller, enforceable in accordance with its terms
and conditions. The Seller need not give any
notice to, make any filing with, or obtain any
authorization, consent or approval of any
government or governmental agency in order to
consummate the transactions contemplated by this
Agreement;
(b) neither the execution and delivery of this
Agreement, nor the consummation of the
transactions contemplated hereby, will (i) violate
any provision of the Seller's charter or by-laws,
or (ii) conflict with, result in the acceleration
of, create in any party the right to accelerate,
terminate, modify, cancel or require any notice
under any agreement, contract, lease, license,
instrument or other arrangement to which the
Seller is a party or by which the Seller is bound
or to which any of its assets is subject;
(c) the Seller has no obligation to pay any fees
or commissions to any broker, finder, agent,
financial person or other intermediary with
respect to the transactions contemplated by this
Agreement for which the Purchasers could become
liable;
(d) the Seller is the holder of record of, to the
best of its knowledge, and beneficially owns, the
Shares free and clear of any
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restrictions on transfer (other than any
restrictions under the Act (as defined below), and
state securities laws), taxes, security interests,
warrants, options, purchase rights, contracts,
commitments, equities, claims and demands. The
Seller is not a party to any option, warrant,
purchase right, or other contract or commitment
that could require the Seller to sell, transfer or
otherwise dispose of any capital stock of the
Company (other than this Agreement). The Seller is
not a party to any voting trust, proxy, or other
agreement or understanding with respect to the
voting of any capital stock of the Company. All of
the Shares are validly issued, fully paid and
non-assessable; and
(e) to the best of the Seller's knowledge, the
rights assigned and transferred by the Seller to
the Purchasers pursuant to this Agreement shall
be, upon consummation of the Closing, enforceable
against the Company by the Funds as assignee of
Seller after the date of the Closing in accordance
with the terms hereof.
(f) the Seller acknowledges that in agreeing to
purchase the Shares, the Purchaser is relying upon
the truth and accuracy of each of the Sellers'
acknowledgments, covenants, representations and
warranties contained herein.
The Purchasers'
Representations
and Warranties: Each of the Purchasers represents and warrants to
the Seller as follows:
(a) the Purchasers have full power and authority
to enter into this Agreement and to perform their
obligations hereunder. This Agreement constitutes
a legal, valid and binding obligation of each of
the Purchasers, enforceable in accordance with its
terms and conditions. The Purchasers need not give
any notice to, make any filing with, or obtain any
authorization, consent or approval of any
government or governmental agency in order to
consummate the transactions contemplated by this
Agreement;
(b) neither the execution and delivery of this
Agreement, nor the consummation of the
transactions contemplated hereby, will (i) violate
any provision of the Funds' certificate of limited
partnership, partnership agreement, declaration of
trust, trust agreement or other organizational
document, or (ii) conflict with, result in the
acceleration of, create in any party the right to
accelerate, terminate, modify, cancel or require
any notice under any agreement, contract, lease,
license, instrument or other arrangement to which
any of the Purchasers is a party or by which
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<PAGE>
any of the Purchasers is bound or to which any of
its assets is subject;
(c) the Purchasers have no obligation to pay any
fees or commissions to any broker, finder, agent,
financial person or other intermediary with
respect to the transactions contemplated by this
Agreement for which the Seller could become
liable;
(d) the Purchasers are not acquiring the Shares
with a view to, or for, sale in connection with
any distribution thereof within the meaning of the
Act. Each of the Purchasers is acquiring the
Shares to be purchased by it for its own account,
beneficially and not as a nominee for or for the
account of another. Each of the Purchasers is an
"accredited investor" within the meaning of
Regulation D promulgated under the Securities Act
of 1933, as amended (the "Act");
(e) the Purchasers have received a copy of the
Prospectus dated February 1, 1996 covering the
resale of the Shares;
(f) each of the Purchasers represents and warrants
that the purchase of the Shares was not solicited
directly or indirectly by the Seller or Highbridge
Capital Management, LLC, or any of their
respective officers and directors or employees;
(g) each of the Purchasers understands that it may
be necessary to hold the Shares for an indefinite
period, and each of the Purchasers is able to bear
the economic risk of the investment in the Shares;
(h) the Shares were not offered or sold to
Purchasers by any form of general solicitation or
general advertising. Each of the Purchasers
acknowledges that the Shares are "restricted
securities" within the meaning of the Act (as
defined below), because the Shares have not been
registered under the Act or any securities or
"blue sky" laws of any jurisdiction on the ground
that the original sale and purchase contemplated
hereby are exempt from registration under the Act
and such jurisdiction's laws;
(i) each of the Purchasers has such knowledge and
experience in financial, tax, and business matters
(including without limitation, professional
experience trading securities with terms and
characteristics similar to the Shares) to be
capable of evaluating the merits and risks of
investments in, and disposition of, restricted
securities such as the Shares; and
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<PAGE>
(j) each of the Purchasers acknowledges that in
agreeing to sell the Shares, the Seller is relying
upon the truth and accuracy of each of the
Purchasers' acknowledgments, covenants,
representations and warranties contained herein.
Additional Provision: The Seller (i) has been afforded an opportunity to
make such inquiry regarding the business and
affairs of the Company as it has deemed
appropriate, (ii) has made an evaluation of the
prospects of the Company, (iii) acknowledges and
understands that the Funds have previously made
and retain a substantial investment in the
Company, and may have superior access to
information regarding its affairs and prospects
which, if known to the Seller, might be material
to the Seller decisions to enter into this
Agreement, (iv) acknowledges and understands that
the Funds may possess and may come into possession
of certain information which is not known to the
Seller and which may be material to a decision to
acquire and/or sell the Shares, and (v) have such
knowledge and experience in financial and business
matters to enable them to evaluate the merits and
risks of the transactions contemplated by this
Agreement.
Covenants of the
Seller: (a) Until closing, the Seller shall take no action
to enforce their rights as Series A or common
stockholders (i) under the Company's Amended and
Restated Articles of Incorporation, (ii) pursuant
to the Unit Purchase Agreement (as defined below)
or (iii) by contract, at common law, by statute,
rule or regulation or otherwise at law or equity,
with respect to the Shares (including any common
stock into which the Shares are convertible).
(b) Along with the transfer of the Shares, the
Seller hereby assigns to the Funds the following
rights, if any: (a) all rights of Seller under the
September 23, 1993 Unit Purchase Agreement,
pursuant to which the Seller purchased the Shares
(the "Unit Purchase Agreement"), with respect to
the Shares; (b) all rights of the Seller granted
to the Seller under the Company's Amended and
Restated Articles of Incorporation and/or bylaws
with respect to the Shares; (c) all rights, claims
and causes of action of any kind, known or
unknown, contingent or matured, arising out of or
relating to Seller's acquisition, ownership or
sale of such Shares which such Seller has or may
have against the Company, the Funds, Paramount
Capital, Inc., Paramount Capital Asset Management,
Inc. or any of their respective present or former
officers, directors, employees, shareholders,
affiliates, agents or advisors (other than claims
arising out of this agreement)) and (d) any other
rights of the Seller with respect to the Shares
whether by
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contract, at common law, by statute, rule or
regulation or otherwise at law or equity.
Indemnification: Seller agrees to indemnify and hold harmless each
of the Purchasers, each officer, director,
stockholder, employee, agent and counsel of each
of the Purchasers and each person, if any, who
controls each of the Purchasers within the meaning
of Section 15 of the Securities Act or Section
20(a) of the Exchange Act, and each of the
Purchasers agrees to indemnify and hold harmless
the Seller, each officer, director, stockholder,
employee, agent, counsel of the Seller and each
person, if any, who controls the Seller within the
meaning of Section 15 of the Securities Act or
Section 20(a) of the Exchange Act from and against
any and all losses, claims, liabilities, expenses,
charges and damages (including any investigative,
legal and other expenses, reasonably incurred in
connection with, and any amount paid in settlement
of, any action, suit or proceeding or any claim
asserted), to which they or any of them, may
become subject under the Securities Act, the
Exchange Act or other Federal or state statutory
law or regulation, at common law or otherwise,
insofar as such losses, claims, liabilities,
expenses, charges or damages arise out of or are
based on any inaccuracy in, or any breach of, any
representation, warranty, covenant or agreement of
the Seller or either Purchaser, as the case may
be, contained in this Agreement.
The Seller and each of the Purchasers agree that
they will not, without the prior written consent
of the other, settle or compromise or consent to
the entry of any judgment in any pending or
threatened claim, action, suit or proceeding in
respect of which indemnification may be sought
hereunder, unless such settlement, compromise, or
consent includes an unconditional release of the
other from all liability arising out of such
claim, action, suit or proceeding.
Non-solicitation: Pending the Closing, the Seller shall not,
directly or indirectly, through any officer,
director, agent or otherwise, negotiate or discuss
with any third party, any proposal with respect to
a sale or any other transaction regarding the
Shares or the shares of common stock underlying
the Shares, other than to notify the Company of
the Seller's intent to sell as required in the
Unit Purchase Agreement.
Miscellaneous: (a) All representations, warranties, covenants and
agreements contained in this Agreement, or in any
document, exhibit, schedule or certificate by any
party delivered in connection herewith shall
survive the execution and delivery of this
Agreement and the date of the Closing and the
consummation of the transactions
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<PAGE>
contemplated hereby, regardless of any
investigation made by any of the Purchasers or
Seller or on their behalf.
(b) The parties hereto shall not disclose to any
party (other than their respective advisors) the
content or the existence of this letter agreement
or the transactions contemplated herein, except as
may be required by law, until such time as the
closing has occurred.
(c) The validity, performance, construction and
effect of this Agreement shall be governed by the
internal laws of the State of New York without
giving effect to principles of conflicts of law.
(d) No waiver by any party of any breach of any
term, provision or condition of this Agreement
will be deemed a waiver of a similar or dissimilar
condition or provision at the same time, or any
prior or subsequent time.
This letter shall constitute the definitive agreement with respect to
the purchase of the Shares and is intended to be binding upon the parties. If
the foregoing accurately reflects your understanding of the definitive terms
pursuant to which the Purchasers will acquire the above referenced Shares,
please so indicate by signing this letter agreement on the space provided below
and returning a facsimile copy of this letter to us at (212) 554-4355, whereupon
this Agreement shall constitute a binding agreement among us.
Sincerely,
THE ARIES TRUST
By: /s/ Lindsay A. Rosenwald
----------------------------
Lindsay A. Rosenwald, M.D., President
Paramount Capital Asset Management, Inc.
Investment Advisor to The Aries Trust
ARIES DOMESTIC FUND, L.P.
By: /s/ Lindsay A. Rosenwald
----------------------------
Lindsay A. Rosenwald, M.D., President
Paramount Capital Asset Management, Inc.
General Partner, Aries Domestic Fund L.P.
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<PAGE>
AGREED TO AND ACCEPTED AS OF
THE DATE FIRST WRITTEN ABOVE:
HIGHBRIDGE CAPITAL CORPORATION
by HIGHBRIDGE CAPITAL MANAGEMENT, LLC
By: ____________________________
Name:
Title:
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<TABLE>
<CAPTION>
EXHIBIT A
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SELLER CUSTODIAN SHARES SALE PRICE PURCHASER
PURCHASED
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<S> <C> <C> <C> <C>
Highbridge Capital Corporation Bear Stearns 10,000 $75,000 Aries Domestic Fund, L.P.
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Highbridge Capital Corporation Bear Stearns 30,000 $225,000 The Aries Fund
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</TABLE>
