EX-10.1






Exhibit 10.1




GENTA INCORPORATED




PURCHASE AGREEMENT AND NOTE AMENDMENT





     This Purchase Agreement and Note Amendment (the “Amendment”) is made and entered
into as of February ___, 2009 by and among Genta Incorporated, a Delaware corporation (the
“Company”), and the Purchasers listed on the Schedule of Purchasers attached hereto as
Exhibit A (each, a “Purchaser” and collectively, the “Purchasers”).
This Amendment amends that certain Securities Purchase Agreement, dated as of June 5,
2008, by and among the Company and the purchasers named therein (the “Purchase Agreement”),
and each of the Senior Secured Convertible Promissory Notes due June 9, 2010 (the “Notes”)
issued pursuant to the Purchase Agreement. Capitalized terms used but not defined herein shall
have the meanings ascribed to such terms in the Purchase Agreement.



     Whereas, the Company desires to raise additional capital in an equity or debt financing in
order to continue its operations;



     Whereas, it is in the best interest of the Purchasers that the Company be able to raise
such capital and continue its operations;



     Whereas, the Purchase Agreement and Notes contain certain terms, the presence of which has
made and may continue to make raising additional capital difficult; and



     Whereas, the Purchasers and the Company, in order to maximize the Company’s ability to
raise additional capital, desire to amend the Purchase Agreement and the Notes as set forth herein.



     Now, Therefore, in consideration of the premises and mutual covenants herein below, and
for other good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties agree as follows:


1. Amendment of the Purchase Agreement.




     1.1 The parties hereby delete Section 1.2(b) of the Purchase Agreement in its entirety.



     1.2 The parties hereby amend and restate Section 1.3 of the Purchase Agreement as follows:




     “1.3 Conversion Shares. The Company has authorized and has reserved
and covenants to continue to reserve, free of preemptive rights and other similar
contractual rights of stockholders a total of 4,000,000,000 shares of Common Stock
to effect the conversion of the Notes and any interest accrued and outstanding
thereon. Within 75 days of the First Closing Date, the Company shall amend its
Certificate (as defined below) to increase the number of authorized shares of Common
Stock (the date of the effectiveness of such amendment, the “Amendment
Date”); provided that the foregoing deadline shall be 120 days if the SEC (as
defined below) reviews the Company’s proxy statement related to the approval of the
amendment. On and after the Amendment Date, the Company shall reserve (and hereby
covenants to continue to reserve), free of preemptive rights and other similar
contractual rights, a number of its authorized but unissued shares of Common Stock
equal to 125% of the aggregate number of shares of Common Stock issuable upon
conversion of or otherwise in respect of the Notes; provided that in the event the
Company shall consummate a Follow-On Offering (defined



 









 







below) the foregoing requirement shall be 100% during the three month period
following the closing of such Follow-On Offering. Any shares of Common Stock
issuable upon conversion or otherwise in respect of the Notes are herein referred to
as the “Conversion Shares”. The Notes and the Conversion Shares are
sometimes collectively referred to herein as the “Securities”. A
“Follow-On Offering” shall mean the sale of up to $23,000,000 of equity
and/or debt securities pursuant to that certain Registration Statement on Form S-1
(Registration No. 333-153278) originally filed on August 29, 2008 with Securities
and Exchange Commission provided that such offering is consummated on or prior to
March 30, 2009 and approved by the holders of 2/3 of the outstanding principal
amount of the Notes.”


2. Amendment of the Notes.




     2.1 The parties hereby amend the term “Purchase Agreement” in each Note to mean the Purchase
Agreement as amended on the date hereof.



     2.2 The parties hereby amend and restate Section 2.1(g) of each Note as follows:




     “(g) at any time following the Amendment Date the Maker shall fail to have a
sufficient number of shares of Common Stock authorized, reserved and available for
issuance to satisfy the potential conversion in full (disregarding for this purpose
any and all limitations of any kind other than as set forth in Section 3.1(a) on
such conversion) of this Note and each Other Note; or”



     2.3 The parties hereby amend and restate Section 3.1(a) of each Note as follows:




     “(a) Voluntary Conversion. At any time and from time to time on or
after the Amendment Date, this Note shall be convertible (in whole or in part), at
the option of the Holder, into such number of fully paid and non-assessable shares
of Common Stock as is determined by dividing (x) that portion of the outstanding
principal balance that the Holder elects to convert by (y) the Conversion Price (as
defined in Section 3.2 hereof) then in effect on the date on which the Holder faxes
a notice of conversion (the “Conversion Notice”), duly executed, to the
Maker (facsimile number (908) 464-1705, Attn.: Raymond P. Warrell, Jr., M.D.) (the
“Voluntary Conversion Date”); provided that during the three month period
following the closing of the Follow-On Offering, if any, the conversion of this Note
shall be limited to the Holder’s Pro Rata Conversion Amount. For purposes of this
Note, the Holder’s “Pro Rata Conversion Amount” shall mean the principal
amount of the Note that may be converted into that number of shares of Common Stock
at the Conversion Price then in effect, determined as follows:



X = Y * (A/B)


where


	 
	 	X =	the number of shares of Common Stock that may be
issued upon conversion of the Note
	 
	 	Y =	the total number of shares of Common Stock then
authorized, unissued and available for issuance
	 
	 	A =	the outstanding principal amount of the Note



 









 






	 	B =	the aggregate outstanding principal amount of all
outstanding Notes and Other Notes






     The Holder shall deliver this Note to the Maker at the address designated in
the Purchase Agreement at such time that this Note is fully converted. With respect
to partial conversions of this Note, the Maker shall keep written records of the
amount of this Note converted as of each Conversion Date. On any such Voluntary
Conversion Date, Maker shall also pay Holder an amount in cash equal to the then
accrued and unpaid interest on the portion of the outstanding principal balance that
the Holder has elected to convert.”



     2.4 The parties hereby amend and restate the first sentence of Section 3.5(h) of each Note as
follows:




     “(h) Reservation of Common Stock. On and after the Amendment Date (as
defined in the Purchase Agreement), the Maker shall at all times when this Note
shall be outstanding, reserve and keep available out of its authorized but unissued
Common Stock, such number of shares of Common Stock as shall from time to time be
sufficient to effect the conversion of this Note; provided that the number of shares
of Common Stock so reserved shall at no time be after the Amendment Date less than
one hundred twenty five percent (125%), or one hundred percent (100%) during the
three month period following the closing of the Follow-On Offering, if any, of the
number of shares of Common Stock for which this Note is at any time convertible
(disregarding for this purpose any and all limitations of any kind on such
conversion).”



     2.5 The parties hereby amend and restate Section 5.13(g) of each Note as follows:




     “(g) “Permitted Lien” means the individual and collective reference to
the following: (a) Liens for taxes, assessments and other governmental charges or
levies not yet due or Liens for taxes, assessments and other governmental charges or
levies being contested in good faith and by appropriate proceedings for which
adequate reserves (in the good faith judgment of the management of the Maker) have
been established in accordance with GAAP; (b) Liens imposed by law which were
incurred in the ordinary course of the Maker’s business, such as carriers’,
warehousemen’s and mechanics’ Liens, statutory landlords’ Liens, and other similar
Liens arising in the ordinary course of the Maker’s business, and which (x) do not
individually or in the aggregate materially detract from the value of such property
or assets or materially impair the use thereof in the operation of the business of
the Maker and its consolidated subsidiaries or (y) are being contested in good faith
by appropriate proceedings, which proceedings have the effect of preventing for the
foreseeable future the forfeiture or sale of the property or asset subject to such
Lien; (c) encumbrances consisting of licenses of the Grantors’ intellectual property
that are created in connection with joint ventures, collaborations, or partnership
activities of Grantors and are approved in advance in writing by the holders of 55%
of the then outstanding principal amount of the Notes; and (d) security interests
granted in connection with any equity or debt financing approved by the holders of
2/3 of the outstanding principal amount of the Notes.”


3. Miscellaneous.




     3.1 Governing Law. This Amendment shall be governed by and construed in accordance
with the internal laws of the State of New York, without giving effect to any of the conflicts of
law principles which would result in the application of the substantive law of another
jurisdiction. This



 









 







Amendment shall not be interpreted or construed with any presumption against the
party causing this Agreement to be drafted.



     3.2 Full Force and Effect. Except as expressly amended by this Amendment, the terms
and conditions of the Purchase Agreement and the Notes remain in full force and effect.



     3.3 Conflict of Terms. In the event of a conflict between this Amendment and any
provision of any of the Purchase Agreement or the Notes, the terms of this Amendment shall control.



     3.4 Counterparts; Effectiveness. This Amendment may be executed in any number of
counterparts, all of which taken together shall constitute one and the same instrument. The
provisions of Sections 1 and 3 hereof shall become effective immediately when counterpart signature
pages to this Amendment have been executed and delivered to the Company by (w) the Company and (x)
holders of at least 2/3 of the principal amount of the outstanding Notes and delivered to the
Company. The provisions of Section 2 hereof shall become effective immediately when counterpart
signature pages to this Amendment have been executed and delivered to the Company by (y) the
Company and (z) holders of all outstanding Notes. All parties need not sign the same counterpart
signature page. Execution by facsimile shall have the same effect as an original signature.



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     In Witness Whereof, the parties hereto have executed this Purchase Agreement and Note
Amendment as of the date set forth in the first paragraph hereof.



	 	 	 	 	 
	 	GENTA INCORPORATED

 	 
	 	By:  	/s/ Raymond P. Warrell
 	 
	 	 	Name:  	Raymond P. Warrell, Jr., M.D. 	 
	 	 	Title:  	Chairman and Chief Executive Officer 	 
	 



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[Signature Page Purchase Agreement and Note Amendment]




 









 





[HOLDER SIGNATURE PAGES TO PURCHASE AGREEMENT AND NOTE AMENDMENT]





     IN WITNESS WHEREOF, the undersigned have caused this Purchase Agreement and Note Amendment to
be duly executed by their respective authorized signatories as of the date first indicated above.



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Signature of Authorized Signatory of Holder: 
          
          
          
          
          
    

             
               
     





Name of Authorized Signatory:
          
          
          
          
          
          
             
             
             
               
     




Title of Authorized Signatory:
          
          
          
          
          
          
             
             
             
               
     




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[Signature Page to Purchase Agreement and Note Amendment]