BERKELEY HEIGHTS, NJ - June 5, 2008
- Genta Incorporated (OTCBB: GNTA) announced today that the
Company has entered into definitive agreements with institutional
and accredited investors to place Senior Secured Convertible Notes
due 2010 totaling in aggregate up to $40 million in gross proceeds
before fees and expenses. The closing of the first $20 million of
Notes is expected to take place on or about June 6, 2008, subject
to the satisfaction of customary closing conditions.
The Notes will bear interest at an annual rate of 15% payable at
quarterly intervals in stock or cash at the Company's option, and
will be convertible into shares of Genta common stock at a
conversion rate of 100,000 shares of common stock for every
$1,000.00 of principal. The first one-half of the Notes, or
$20 million, will be issued upon initial closing of the
transaction. Holders of the Notes shall have the right, but
not the obligation, for the following 12 months following the
initial closing date to purchase in whole or in part up to an
additional $20 million of the Notes. The Company shall have
the right to force conversion of the Notes in whole or in part if
the closing bid price of the Company's common stock exceeds $0.50
for a period of 20 consecutive trading days. Certain members
of senior management of Genta Incorporated participated in this
offering. The Notes are secured by a first lien on all assets
of Genta. The Notes include certain events of default,
including a requirement that the Company obtain stockholder
approval within a specified period of time to amend its certificate
of incorporation to authorize additional shares of common stock.
Rodman & Renshaw, LLC, a wholly-owned subsidiary of Rodman
& Renshaw Capital Group, Inc. (Nasdaq: RODM) served as the
exclusive placement agent for the offering.
"We view this transaction as a transforming financial event for
our Company that will enable us to achieve key programmatic
milestones," said Dr. Raymond P. Warrell, Jr., Genta's Chairman and
Chief Executive Officer. "We believe this financing will
allow us to fully enroll the ongoing Phase 3 AGENDA trial of
Genasense in melanoma, to pursue regulatory actions related to the
use of Genasense in chronic lymphocytic leukemia, and to make
substantial progress in advancing our pipeline of clinical oncology
products. We have recently undertaken a number of steps to
reduce costs, and we greatly appreciate the votes of confidence in
our Company by key biotech investors in this offering."
This press release is not an offer to sell or the solicitation
of an offer to buy, nor shall there be any sales of the securities
in any jurisdiction in which such offer, solicitation, or sale
would be unlawful prior to the registration or qualification under
the securities laws of any such jurisdiction. The Notes were
offered only to qualified institutional buyers under Rule 144A, to
persons outside the Unites States under Regulation S, and to
Accredited Investors under Rule 501.
The Notes offered and the common stock issuable upon conversion
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 registration or an applicable
exemption from registration requirements.
About Genta
Genta Incorporated is a biopharmaceutical company with a
diversified product portfolio that is focused on delivering
innovative products
for the treatment of patients with cancer. Two major programs
anchor the Company's
research platform
: DNA/RNA-based Medicines and Small Molecules.
Genasense® (oblimersen sodium)
Injection is the Company's lead compound from its DNA/RNA Medicines
program. Genta is currently recruiting patients to the
AGENDA
Trial
, a global Phase 3 trial of Genasense in patients with advanced
melanoma. The leading drug in Genta's Small Molecule program
is
Ganite® (gallium nitrate
injection),
which the Company is exclusively marketing in the U.S. for
treatment of symptomatic patients with cancer related hypercalcemia
that is resistant to hydration. The Company has developed
G4544
, an oral formulation of the active ingredient in Ganite, that has
recently entered clinical trials as a potential treatment for
diseases associated with accelerated bone loss. The Company
is also developing
tesetaxel
, a novel, orally absorbed, semi-synthetic taxane that is in the
same class of drugs as paclitaxel and docetaxel. Ganite and
Genasense are available on a "
named-patient
" basis in countries outside the United States. For more
information about Genta, please visit our website at:
http://www.genta.com//
.
Safe Harbor
This press release may contain forward-looking statements with
respect to business conducted by Genta Incorporated. By their
nature, forward-looking statements and forecasts involve risks and
uncertainties because they relate to events and depend on
circumstances that will occur in the future. Forward-looking
statements include, without limitation, statements about:
- the Company's ability to obtain necessary regulatory approval
for Genasense® from the U.S. Food and Drug Administration ("FDA")
or European Medicines Agency ("EMEA");
- the safety and efficacy of the Company's products or product
candidates;
- the Company's assessment of its clinical trials;
- the commencement and completion of clinical trials;
- the Company's ability to develop, manufacture, license and
sell its products or product candidates;
- the Company's ability to enter into and successfully execute
license and collaborative agreements, if any;
- the adequacy of the Company's capital resources and cash flow
projections, and the Company's ability to obtain sufficient
financing to maintain the Company's planned operations;
- the adequacy of the Company's patents and proprietary
rights;
- the impact of litigation that has been brought against the
Company and its officers and directors and any proposed
settlement of such litigation;
- the Company's ability to retain compliance with the NASDAQ's
listing qualifications; and
- the other risks described under Certain Risks and
Uncertainties Related to the Company's Business, as contained in
the Company's Annual Report on Form 10-K and Quarterly Report on
Form 10-Q.
The Company does not undertake to update any forward-looking
statements. There are a number of factors that could
cause actual results and developments to differ materially.
For a discussion of those risks and uncertainties, please see the
Company's Annual Report on Form 10-K for 2007 and its most recent
quarterly report on Form 10-Q.
SOURCE: Genta Incorporated
CONTACT:
Genta Investor Relations
908-286-3980
info@genta.com
