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Exhibit 10.4
 
SEPARATION AGREEMENT

THIS SEPARATION AGREEMENT (the “Agreement”), made in New York, New York as of
January 5, 2016, between SIGA Technologies, Inc., a Delaware corporation (the
“Company”), and William J. Haynes II (“Executive”).

WHEREAS, the Company and Executive entered into an Employment Agreement dated
June 4, 2012, as amended (the “Employment Agreement”), providing for Executive’s
employment by the Company and setting forth the terms and conditions of such
employment;

WHEREAS, Executive currently serves as an Executive Vice President and the
General Counsel of the Company;

WHEREAS, the parties have mutually agreed that Executive’s employment with the
Company shall terminate effective January 5, 2016;

WHEREAS, the Company and Executive have mutually agreed upon the payments,
benefits and other terms and conditions provided herein relating to the
termination of Executive’s employment;

WHEREAS, the Company has filed a plan for reorganization (as amended, modified,
and supplemented, the “Plan”) under chapter 11 of the United States Bankruptcy
Code (the “Bankruptcy Code”) in its pending case under the Bankruptcy Code; and

WHEREAS, this Agreement shall become effective upon and subject to the
occurrence of the Effective Date (as defined in the Plan), and at which time the
Employment Agreement shall be superseded by this Agreement and of no further
force or effect.

NOW, THEREFORE, IN CONSIDERATION of the mutual covenants and agreements
hereinafter set forth, the Company and Executive agree as follows:

  1. Separation. Executive’s last day of work with the Company and Executive’s
employment termination date shall be January 5, 2016 (the “Separation Date”). If
Executive resigns on or before the Separation Date, Executive shall receive the
payments described in Section 3 below.

2. Accrued Salary and Vacation. Within fifteen (15) days following the
Separation Date, the Company shall pay Executive all accrued and unpaid wages
and all accrued and unused vacation time earned through the Separation Date,
subject to all required payroll deductions and withholdings.  Executive is
entitled to these payments regardless of whether or not Executive signs this
Agreement.

3. Separation Pay. Subject to the occurrence of the Effective Date and
Executive’s compliance with Section 16 below, if Executive signs this Agreement,
timely returns it to the Company, and does not revoke any portion of this
Agreement within the time period set forth in Section 11 below, the Company
shall pay Executive the following amounts:

 

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William J. Haynes II
January 5, 2016
Page 2
 
(a) Executive’s annual bonus for the 2014 calendar year equal to $119,351, which
amount shall be payable in cash in full on the Effective Date.  In the event
that in the future the Compensation Committee of the Company’s Board of
Directors decides to restore 2014 bonus pay lost as a consequence of the
bankruptcy proceeding, Executive shall not be treated less favorably than other
executives of the Company; and

(b) Executive’s annual bonus for the 2015 calendar year subject to the
discretion of the Compensation Committee of the Company’s Board of Directors,
based upon a target bonus opportunity of $491,728, which represents one hundred
percent (100%) of Executive’s 2015 base salary, based on the attainment of the
applicable performance criteria and goals established by the Compensation
Committee prior to the Effective Date, the achievement of which shall be
determined consistent with the methodology and measurement standards established
by the Compensation Committee prior to the Effective Date, provided, however,
that Executive shall not be treated less favorably than other executives of the
Company with respect to determinations concerning the attainment of the
applicable performance criteria and goals established by the Compensation
Committee with respect to the Executive and payment of bonus.  Such annual bonus
shall be paid no later than March 15, 2016.

4. Health Insurance. Executive’s group health insurance shall cease on the last
day of the month in which his employment ends. At that time, Executive shall be
eligible to continue his group health insurance benefits at his own expense,
subject to the terms and conditions of the benefit plan, federal Consolidated
Omnibus Budget Reconciliation Act (COBRA) law, and, as applicable, state
insurance laws. Executive shall receive additional information regarding his
right to elect continued coverage under COBRA in a separate communication.

5. Tax Matters. The Company shall withhold required federal, state, and local
taxes from any and all payments contemplated by this Agreement. Other than the
Company’s obligation and right to withhold, Executive shall be responsible for
any and all taxes, interest, and penalties that may be imposed with respect to
the payments contemplated by this Agreement.

6. Other Compensation or Benefits. Executive acknowledges that, except as
expressly provided in this Agreement, Executive shall not receive any additional
compensation, benefits, or separation pay after the Separation Date. Thus, for
any employee benefits sponsored by the Company not specifically referenced in
this Agreement, Executive shall be treated as a terminated employee effective on
the Separation Date.  This includes but is not limited to a 401(k) plan, life
insurance, accidental death and dismemberment insurance, and short and long-term
disability insurance.

 

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William J. Haynes II
January 5, 2016
Page 3
 

7. Expense Reimbursement. Executive agrees that, within ten (10) calendar days
of the Separation Date, Executive shall submit his final documented expense
reimbursement statement reflecting all business expenses Executive incurred
through the Separation Date, if any, for which Executive seeks reimbursement.
The Company shall reimburse Executive for these expenses pursuant to its regular
business practice.

8. Return of Company Property. By the Separation Date, Executive agrees to
return to the Company all hard copy and electronic documents (and all copies
thereof) and other Company property that Executive has had in his possession at
any time, including, but not limited to, files, notes, drawings, records,
business plans and forecasts, financial information, specifications,
computer-recorded information (including email), tangible property (laptop
computer, cell phone, PDA, etc.), credit cards, entry cards, identification
badges and keys, and any materials of any kind that contain or embody any
proprietary or confidential information of the Company (and all reproductions
thereof). If Executive discovers after the Separation Date that he has retained
any Company proprietary or confidential information, Executive agrees
immediately upon discovery to contact the Company and make arrangements for
returning the information.

9. Nondisparagement. Executive agrees not to disparage the Company, and its
officers, directors, employees, or agents, in any manner likely to be harmful to
them or their business, business reputation or personal reputation; provided,
however, that statements which are made in good faith in response to any
question, inquiry, or request for information required by legal process shall
not violate this paragraph. Nothing in this restriction is intended to limit
Executive from giving honest statements to an administrative agency
investigating an alleged violation of discrimination laws.

10. Release of All Claims. Except as otherwise set forth in this Agreement,
Executive hereby releases, acquits and forever discharges the Company, TriNet HR
Corporation and their affiliates, officers, agents, administrators, servants,
employees, attorneys, successors, parent, subsidiaries, assigns, and affiliates
(each, a “Released Party” and collectively, the “Released Parties”), of and from
any and all claims, liabilities, demands, causes of action, costs, expenses,
attorneys’ fees, damages, indemnities, and obligations of every kind and nature,
in law, equity, or otherwise, known and unknown, suspected and unsuspected,
disclosed and undisclosed, arising out of or in any way related to agreements,
events, acts, omissions, or conduct at any time prior to and including the date
Executive signs this Agreement. This general release includes, but is not
limited to: (i) claims and demands arising out of or in any way connected with
Executive’s employment with the Company, or the termination of that employment;
(ii) claims or demands related to Executive’s compensation or benefits with the
Company, including but not limited to, wages, salary, bonuses, commissions,
vacation pay, fringe benefits, expense reimbursements, incentive pay, severance
pay, or any other form of compensation; (iii) claims pursuant to any federal,
state, local or foreign law, statute, regulation or cause of action including,
but not limited to, claims for discrimination, harassment, retaliation,
attorneys’ fees or other claim arising under the federal Civil Rights Act of
1964, as amended; the federal Americans with Disabilities Act of 1990, as
amended; the federal Age Discrimination in Employment Act of 1967, as amended
(the “ADEA”); the federal Family Medical Leave Act, as amended; the federal
Worker Adjustment and Retraining Notification Act, as amended; the Employee
Retirement Income Security Act of 1974, as amended; New York Fair Employment
Practices Law (N.Y. Exec. Law §§ 296 et seq.); New York Equal Pay Law (N.Y. Lab.
Law § 194); New York WARN Law (N.Y. Lab. Law §§ 860 et seq.), as amended; (iv)
all tort claims, including without limitation, claims for fraud, defamation,
emotional distress, and discharge in violation of public policy; and (v) all
claims for breach of contract, wrongful termination, and breach of the implied
covenant of good faith and fair dealing, including claims arising out of an
employment agreement, including the Employment Agreement, sales commission plan
or incentive compensation plan applicable to Executive’s employment with the
Company. To the extent permitted by law, Executive also promises never directly
or indirectly to bring or participate in an action against any Released Party,
including without limitation under any unfair competition law of any
jurisdiction.

 

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William J. Haynes II
January 5, 2016
Page 4
 
Excluded from this Agreement are any claims which by law cannot be waived in a
private agreement between an employer and employee. Moreover, this Release does
not prohibit Executive from filing a charge with the Equal Employment
Opportunity Commission (the “EEOC”) or equivalent state agency in Executive’s
state or participating in an EEOC or state agency investigation. Executive
agrees to waive his right to monetary or other recovery should any claim be
pursued with the EEOC, state agency, or any other federal, state or local
administrative agency on Executive’s behalf arising out of or related to
Executive’s employment with and/or separation from the Company.
 

11. ADEA Waiver. Executive acknowledges that he is knowingly and voluntarily
waiving and releasing any rights he may have under the ADEA, as amended.
Executive also acknowledges that the consideration given for the waiver and
release herein is in addition to anything of value to which Executive was
already entitled. Executive further acknowledges that he has been advised by
this writing, as required by the ADEA, that: (a) Executive’s waiver and release
do not apply to any rights or claims that may arise after the execution date of
this Agreement; (b) Executive has been advised hereby that he has the right to
consult with an attorney prior to executing this Agreement; (c) Executive has up
to twenty-one (21) calendar days from the date of this Agreement to execute this
Agreement (although Executive may choose to voluntarily execute this Agreement
earlier); (d) Executive has seven (7) calendar days following the execution of
this Agreement by the parties to revoke the Agreement; and (e) this Agreement
shall not be effective until the eighth day after the day that this Agreement is
executed by Executive, provided that Executive has not revoked this Agreement
prior to such date (the “Release Effective Date”); and (f) this Agreement does
not affect Executive’s ability to test the knowing and voluntary nature of this
Agreement.

12. No Actions or Claims. Executive represents that he has not filed any
charges, complaints, grievances, arbitrations, lawsuits, or claims against the
Company, with any local, state or federal agency, union or court from the
beginning of time to the date of execution of this Agreement and that Executive
shall not do so at any time hereafter, based upon events occurring prior to the
date of execution of this Agreement. In the event any agency, union, or court
ever assumes jurisdiction of any lawsuit, claim, charge, grievance, arbitration,
or complaint, or purports to bring any legal proceeding on Executive’s behalf,
Executive shall ask any such agency, union, or court to withdraw from and/or
dismiss any such action, grievance, or arbitration, with prejudice.

 

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William J. Haynes II
January 5, 2016
Page 5
 

13. Employment Rights. Executive hereby waives any and all rights to employment
or re- employment with the Company or any successor or affiliated organization
(“Related Entity”). Executive agrees that the Company and the Related Entities
have no obligation, contractual or otherwise, to employ or re-employ Executive,
now or in the future, either directly or indirectly, on a full-time, part-time,
or temporary basis, including, but not limited to, utilizing Executive’s
services as a temporary employee, worker, or contractor through any temporary
service providers, vendors, or agencies.

14. Acknowledgements and Representations. Executive acknowledges and represents
that he has not suffered any discrimination or harassment by any of the Released
Parties on account of his race, gender, national origin, religion, marital or
registered domestic partner status, sexual orientation, age, disability, medical
condition, or any other characteristic protected by law. Executive acknowledges
and represents that he has not been denied any leave, benefits or rights to
which he may have been entitled under the FMLA or any other federal or state
law, and that he has not suffered any job-related wrongs or injuries for which
Executive might still be entitled to compensation or relief. Executive further
acknowledges and represents that, except as expressly provided in this
Agreement, he has been paid all wages, bonuses, compensation, benefits and other
amounts that any of the Released Parties have ever owed to Executive, and he
understands that he shall not receive any additional compensation, severance, or
benefits after the Separation Date, with the exception of any vested right
Executive may have under the terms of a written ERISA-qualified benefit plan.

15. Miscellaneous.  This Agreement, including Exhibit A, constitutes the
complete, final, and exclusive embodiment of the entire agreement between
Executive and the Company with regard to this subject matter. It is entered into
without reliance on any promise or representation, written or oral, other than
those expressly contained herein, and it supersedes any other such agreements,
promises, warranties, or representations, including the Employment Agreement
(other than as set forth in Section 16 below). This Agreement may not be
modified or amended except in a writing signed by both Executive and a duly
authorized officer of the Company. This Agreement shall bind the heirs, personal
representatives, successors, and assigns of both Executive and the Company, and
inure to the benefit of both Executive and the Company, their heirs, successors,
and assigns. If any provision of this Agreement is determined to be invalid or
unenforceable, in whole or in part, this determination shall not affect any
other provision of this Agreement and the provision in question shall be
modified by the court so as to be rendered enforceable. This Agreement shall be
deemed to have been entered into and shall be construed and enforced in
accordance with the laws of the State of New York, without reference to its
choice of law rules.

 

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William J. Haynes II
January 5, 2016
Page 6
 

16. Restrictive Covenants and Cooperation.  Executive agrees to adhere to (i)
each restrictive covenant provided in the Employment Agreement, including the
proprietary information covenant, the confidentiality and surrender of records
covenant, the non-solicitation and non-competition restrictive covenants
described in Section 6 of the Employment Agreement, (ii) the inventions and
patents provision in Section 6(e) of the Employment Agreement, and (iii) the
cooperation covenant in Section 8(a) of the Employment Agreement, along with any
restrictive covenant contained herein.  Notwithstanding the foregoing, Executive
shall only be obligated to provide assistance to the Company under Section 8(a)
of the Employment Agreement for a period of twelve (12) months from the
Separation Date.  A copy of the Employment Agreement is attached hereto as
Exhibit A.

17. Code Section 409A.  The intent of the parties is that payments and benefits
under this Agreement be exempt from Internal Revenue Code Section 409A and the
regulations and guidance promulgated thereunder and, accordingly, to the maximum
extent permitted, this Agreement will be interpreted in a manner consistent with
such intent.

18. Indemnification.  Nothing contained herein shall constitute a release of any
claims or right Executive has for indemnification under the Employment Agreement
or the Company’s directors and officers liability insurance policies or the
Company’s bylaws or programs or under applicable law with respect to any events
occurring on or prior to the Separation Date regardless of when any action to
which such rights to indemnification apply may be asserted.

19. Waiver.  No waiver by either party of any breach by the other party of any
condition or provision of this Agreement to be performed by such other party
shall be deemed a waiver of any other provision or condition at the time or at
any prior or subsequent time.

20. Notices.  All notices given hereunder shall be given in writing, shall
specifically refer to this Agreement and shall be personally delivered or sent
by telecopy or other electronic facsimile transmission or by registered or
certified mail, return receipt requested, at the address set forth below or at
such other address as may hereafter be designated by notice given in compliance
with the terms hereof:

If to Executive:
Executive’s last known address as reflected in the Company’s records, or to such
other address as Executive shall designate by written notice to the Company.
     
If to the Company:
SIGA Technologies, Inc.
   
660 Madison Avenue – Suite 1700
   
New York, New York 10065
   
Attention:  Chief Executive Officer

 

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William J. Haynes II
January 5, 2016
Page 7
 
with a copy to:
Weil, Gotshal & Manges LLP
   
767 5th Avenue
   
New York, NY 10153
   
Attention:  Stephen Karotkin
   
Telephone: (212) 310-8350
   
Facsimile: (212) 310-8007

If notice is mailed, such notice shall be effective upon mailing, or if notice
is personally delivered or sent by telecopy or other electronic facsimile
transmission, it shall be effective upon receipt.

21. Counterparts.  This Agreement may be executed in counterparts, each of which
shall be deemed an original but all of which together shall constitute one and
the same instrument.

[SIGNATURE PAGE FOLLOWS]
 

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William J. Haynes II
January 5, 2016
Page 8
 
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
dates set forth below.

SIGA Technologies, Inc.

By:
/s/ Eric A. Rose  
Date:
 January 5, 2016     Name: Dr. Eric A. Rose, M.D.   Title:   Chief Executive
Officer

By:
 /s/ William J. Haynes II  
Date:
 January 5, 2016     William J. Haynes II

 
 

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