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Exhibit 10.2
 
 

 
THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY
OTHER SECURITIES LAWS, AND SUCH SECURITIES MAY NOT BE SOLD,
PLEDGED, HYPOTHECATED OR OTHERWISE TRANSFERRED IN THE
ABSENCE OF SUCH REGISTRATION UNDER SAID ACT AND LAWS OR AN
EXEMPTION THEREFROM.

SIGA TECHNOLOGIES, INC.

COMMON STOCK PURCHASE WARRANT

1.    Issuance; Certain Definitions.

1.1    In consideration of good and valuable consideration, the receipt of which
is hereby acknowledged by SIGA TECHNOLOGIES, INC., a Delaware corporation (the
"Company"), MacAndrews & Forbes LLC, a Delaware limited liability corporation,
or its registered assigns, is hereby granted the right to purchase at any time
until 5:00 P.M., New York City time, on the Expiration Date, 196,078 fully paid
and nonassessable shares of Common Stock, at an initial exercise price per share
(the “Exercise Price”) of $3.519 per share, subject to adjustment as set forth
herein.  The shares of Common Stock issued upon exercise of this Warrant, as
adjusted from time to time pursuant to Section 6 hereof, are referred to as
“Consideration Warrant Shares.”  This Warrant is being issued pursuant to the
terms and conditions of the Commitment Letter.

1.2    As used in this Warrant, the following terms have the respective meanings
set forth below:

"Actual Minimum" has the meaning assigned to it in Section 11.2 hereof.

"Affiliate" means, with respect to any specified Person, (i) any other Person
50% or more of whose Outstanding voting securities are directly or indirectly
owned, controlled or held with the power to vote by such specified Person or
(ii) any other Person directly or indirectly controlling, controlled by or under
direct or indirect common control with such specified Person.  For purposes of
this definition, the term "control" means the possession, directly or
indirectly, of the power to direct or cause the direction of the management or
policies of a Person by virtue of ownership of voting securities, by contract or
otherwise.

"Appraisal Procedure" means the following procedure to determine the fair market
value, as to any security, for purposes of the definition of "Fair Market Value"
or the fair market value, as to any other property (in either case, the
"Valuation Amount").  The Valuation Amount shall be determined in good faith
jointly by the Board of Directors and the Holder; provided, however, that if
such parties are not able to agree on the Valuation Amount within a reasonable
period of time (not to exceed 20 Business Days) the Valuation Amount shall be
determined by an investment banking firm of national reputation, which firm
shall be reason­ably acceptable to the Board of Directors and the Holder.  If
the Board of Directors and the Holder are unable to agree upon an acceptable
investment banking firm within 10 days after the date either party proposed that
one be selected, the investment banking firm will be selected by an arbitrator
located in New York City, New York, selected by the American Arbitration
Association (or if such organization ceases to exist, the arbitrator shall be
chosen by a court of competent jurisdiction). The arbitrator shall select the
investment banking firm (within 10 days of his appointment) from a list, jointly
prepared by the Board of Directors and the Holder, of not more than six
investment banking firms of national reputation in the United States, of which
no more than three may be named by the Board of Directors and no more than three
may be named by the Holder.  The arbitrator may consider, within the 10-day
period allotted, arguments from the parties regarding which investment banking
firm to choose, but the selection by the arbitrator shall be made in its sole
discretion from the list of six.  The Board of Directors and the Holder shall
submit their respective valuations and other relevant data to the investment
banking firm, and the investment
 
 

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banking firm shall, within 30 days of its appointment, make its own
determination of the Valuation Amount.  The determination of the final Valuation
Amount by such investment banking firm shall be final and binding upon the
parties.  The Company shall pay all of the fees and expenses of the investment
banking firm and arbitrator (if any) used to determine the Valuation Amount.  If
required by any such investment banking firm or arbitrator, the Company shall
execute a retainer and engagement letter containing reasonable terms and
conditions, including, without limitation, customary provisions concerning the
rights of indemnification and contribution by the Company in favor of such
investment banking firm or arbitrator and its officers, directors, partners,
employees, agents and Affiliates.

"Board of Directors" means the board of directors of the Company.

"Business Day" means any day that is not a Saturday or Sunday or a day on which
banks are required or permitted to be closed in the State of New York.

"Commitment Letter" means the Commitment Letter by and between the Company and
MacAndrews & Forbes LLC, dated June 19, 2008, as amended by that certain
Extension Letter, dated as of April 29, 2009.

"Common Stock" means the Common Stock of the Company, par value $0.0001 per
share, as constituted on the Original Issue Date, and any capital stock into
which such Common Stock may thereafter be changed, and shall also include (i)
capital stock of the Company of any other class (regardless of how denominated)
issued to the holders of shares of any Common Stock upon any reclassification
thereof which is not preferred as to dividends or liquidation over any other
class of stock of the Company and which is not subject to redemption and (ii)
shares of common stock of any successor or acquiring corporation received by or
distributed to the holders of Common Stock of the Company in the circumstances
contemplated by Section 6.5 hereof.

"Company" has the meaning assigned to it in Section 1.1 hereof.

"Designated Office" has the meaning assigned to it in Section 11.3 hereof.

"Excluded Stock" has the meaning assigned to it in Section 6.10 hereof.

"Exercise Date" has the meaning assigned to it Section 2.1(a) hereof.

 "Exercise Price" means, in respect of a share of Common Stock at any date
herein specified, the initial Exercise Price set forth in Section 1.1 hereof, as
adjusted from time to time pursuant to Section 6 hereof.

"Expiration Date" means April 29, 2013.

"Fair Market Value" means, as to any security, the Twenty Day Average of the
average closing prices of such security's sales on all domestic securities
exchanges on which such security may at the time be listed, or, if there have
been no sales on any such exchange on any day, the average of the highest bid
and lowest asked prices on all such exchanges at the end of such day, or, if on
any day such security is not so listed, the average of the highest bid and
lowest asked prices on such day in the domestic over-the-counter market as
reported by the National Quotation Bureau, Incorporated, or any similar or
successor organization (and in each such case excluding any trades that are not
bona fide, arm's length transactions).  If at any time such security is not
listed on any domestic securities exchange or quoted on the domestic
over-the-counter market, the "Fair Market Value" of such security shall be the
fair market value thereof as determined in accordance with the Appraisal
Procedure, using any appropriate valuation method, assuming an arms-length sale
to an independent party.

"Form of Assignment" has the meaning assigned to it in Section 4.1 hereof.
 
 
 

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"Governmental Entity" means any national, federal, state, municipal, local,
territorial, foreign or other government or any department, commission, board,
bureau, agency, regulatory authority or instrumentality thereof, or any court,
judicial, administrative or arbitral body or public or private tribunal.

"Holder" means (a) with respect to this Warrant, the Person in whose name the
Warrant set forth herein is registered on the books of the Company maintained
for such purpose and (b) with respect to any other Warrant or Warrant Shares,
the Person in whose name such Warrant or Warrant Shares is registered on the
books of the Company maintained for such purpose.

"Issuable Minimum" has the meaning assigned to it in Section 11.2 hereof.

"Lien" means any mortgage or deed of trust, pledge, hypothecation, assignment,
deposit arrangement, lien, charge, claim, security interest, easement or
encumbrance, or preference, priority or other security agreement or preferential
arrangement of any kind or nature whatsoever (including, without limitation, any
lease or title retention agreement, any financing lease having substantially the
same economic effect as any of the foregoing, and the filing of, or agreement to
give, any financing statement perfecting a security interest under the Uniform
Commercial Code or comparable law of any jurisdiction).

"Notice of Exercise" has the meaning assigned to it in Section 2.1(a) hereof.

"Original Issue Date" means April 30, 2009.

"Original Warrants" means the Warrants originally issued by the Company on April
30, 2009, pursuant to the Commitment Letter.

 "Outstanding" means, (a) when used with reference to Common Stock, at any date
as of which the number of shares thereof is to be determined, all issued shares
of Common Stock, except shares then owned or held by or for the account of the
Company or any Subsidiary, and shall include all shares issuable in respect of
Outstanding scrip or any certificates representing fractional interests in
shares of Common Stock and (b) when used with reference to Warrants, at any date
as of which the number thereof is to be determined, all issued Warrants.

"Permitted Transferee" means (i) any Affiliate of the Holder, including, without
limitation, directors, executives and officers of the Holder, (ii) any member of
the family of any Affiliate of the Holder, including any such Person's spouse
and descendants and any trust, partnership, corporation, limited liability
company or other entity for the benefit of such spouse and/or descendants to
whom or which any of the Securities have been transferred by any such Person for
estate or tax planning purposes, (iii) any charity or foundation to which the
Securities have been transferred by the Holder or any Person or entity described
in clause (i) or (ii) above for estate or tax planning or charitable purposes,
or (iv) the beneficiary of any bona fide pledge by the Holder of any of the
Securities.

"Person" means any individual, sole proprietorship, partnership, limited
liability company, joint venture, trust, incorporated organization, association,
corporation, institution, Governmental Entity or any other entity.

"Reserved Spin Off Securities" has the meaning assigned to it in Section 6.2
hereof.

"SEC" means the U.S. Securities and Exchange Commission or any other federal
agency then administering the Securities Act and other federal securities laws.

"Securities Act" means the Securities Act of 1933, as amended, and the rules and
regulations of the SEC thereunder, all as the same shall be in effect at the
time.

"Spin Off Securities" has the meaning assigned to it in Section 6.2 hereof.
 
 
 

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"Subsidiary" means, with respect to any Person, any corporation, association
trust, limited liability company, partnership, joint venture or other business
association or entity (i) at least 50% of the Outstanding voting securities of
which are at the time owned or controlled directly or indirectly by such Person
or (ii) with respect to which the Company possesses, directly or indirectly, the
power to direct or cause the direction of the affairs or management of such
Person.

“Subscription Agreement” means the Subscription Agreement by and between the
Company and MacAndrews & Forbes LLC, dated April 30, 2009.

"Transfer" means any disposition of any Warrant or Warrant Shares or of any
interest therein, which would constitute a "sale" thereof within the meaning of
the Securities Act.

"Twenty Day Average" means, with respect to any prices and in connection with
the calculation of Fair Market Value, the average of such prices over the 20
Business Days ending on the Business Day immediately prior to the day as of
which Fair Market Value is being determined.

"Warrant Price" means an amount equal to (i) the number of Consideration Warrant
Shares being purchased upon exercise of this Warrant pursuant to Sections 1 and
2 hereof, multiplied by (ii) the Exercise Price.

"Consideration Warrant Shares" has the meaning assigned to it in Section 1.1
hereof.

"Warrants" means the Original Warrants and all Warrants issued upon transfer,
division or combination of, or in substitution for, the Original Warrants, or
any other such Warrant subsequently issued to the Holder.  All Warrants shall at
all times be identical as to terms and conditions, except as to the
Consideration Warrant Shares for which they may be exercised and their date of
issuance.

2.      Exercise of Warrants.

2.1    Manner of Exercise.

(a) This Warrant is exercisable in whole or in part at any time and from time to
time on any Business Day from and after the Original Issue Date and at any time
until 5:00 P.M., New York time, on the Expiration Date.  Such exercise shall be
effectuated by submitting to the Company at its Designated Office (i) a
completed and duly executed written notice of the Holder's election to exercise
this Warrant (a "Notice of Exercise") (substantially in the form attached to
this Warrant as Annex A) indicating the Consideration Warrant Shares then being
purchased pursuant to such exercise, together with this Warrant and (ii) payment
to the Company of the Warrant Price. The date on which such delivery and payment
shall have taken place being sometimes referred to as the "Exercise Date."

(b) Upon receipt by the Company of such Notice of Exercise, surrender of this
Warrant and payment of the Warrant Price (in accordance with Section 2.1(c)
hereof), the Holder shall be entitled to receive as promptly as practicable, and
in any event within five Business Days thereafter, a certificate or certificates
for Consideration Warrant Shares so purchased in such denomination or
denominations as the exercising Holder shall reasonably request in the Notice of
Exercise, registered in the name of the Holder or, subject to Section 4 hereof,
such other name as shall be designated in the Notice of Exercise, together with
cash in lieu of any fraction of a share, as provided in Section 2.3 hereof.  If
this Warrant shall have been exercised in part, the Company shall, at the time
of delivery of the certificate or certificates representing the Consideration
Warrant Shares being issued, deliver to the Holder a new Warrant evidencing the
rights of the Holder to purchase the remaining Consideration Warrant Shares
underlying this Warrant.  Such new Warrant shall in all other respects be
identical to this Warrant.  This Warrant shall be deemed to have been exercised
and such certificate or certificates of Consideration Warrant Shares shall be
 
 

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deemed to have been issued, and the Holder or any other Person so designated to
be named therein shall be deemed to have become a holder of record of such
Consideration Warrant Shares for all purposes, as of the Exercise Date.
 
(c) Payment of the Warrant Price shall be made at the option of the Holder by
one or more of the following methods: (i) by delivery of a certified or official
bank check or by wire transfer of immediately available funds in the amount of
such Warrant Price payable to the order of the Company, (ii) by instructing the
Company to withhold a number of Consideration Warrant Shares then issuable upon
exercise of this Warrant with an aggregate Fair Market Value equal to such
Warrant Price, (iii) by surrendering to the Company shares of Common Stock
previously acquired by the Holder with an aggregate Fair Market Value equal to
such Warrant Price, or (iv) any combination of the foregoing.  In the event of
any withholding of Consideration Warrant Shares or surrender of Common Stock
pursuant to clause (ii), (iii) or (iv) above where the number of shares whose
Fair Market Value is equal to the Warrant Price is not a whole number, the
number of shares withheld by or surren­dered to the Company shall be rounded up
to the nearest whole share and the Company shall make a cash payment to the
Holder based on the incremental fraction of a share being so withheld by or
surrendered to the Company in an amount determined in accordance with Section
2.3 hereof.

2.2    Payment of Taxes.  All Consideration Warrant Shares issuable upon the
exercise of this Warrant pursuant to the terms hereof shall be validly issued,
fully paid and nonassessable, issued without violation of any preemptive or
similar rights of any stockholder of the Company and free and clear of all
Liens.  The Company shall pay all expenses in connection with, and all taxes and
other governmental charges that may be imposed with respect to, the issue or
delivery thereof.  The Company shall not, however, be required to pay any tax or
governmental charge which may be issuable upon exercise of this Warrant payable
in respect of any Transfer involved in the issue and delivery of Consideration
Warrant Shares in a name other than that of the holder of the Warrants to be
exercised, and no such issue or delivery shall be made unless and until the
Person request­ing such issue has paid to the Company the amount of any such
tax, or has established to the satisfaction of the Company that such tax has
been paid.

2.3    Fractional Shares.  The Company shall not be required to issue a
fractional share of Common Stock upon exercise of any Warrant.  As to any
fraction of a share that the Holder of one or more Warrants, the rights under
which are exercised in the same transaction, would otherwise be entitled to
purchase upon such exercise, the Company shall pay to such Holder an amount in
cash equal to such fraction multiplied by the Fair Market Value of one share of
Common Stock on the Exercise Date.

3.      Reservation and Authorization of Common Stock.  The Company shall at all
times during the term of this Warrant reserve for issuance upon exercise of the
then outstanding balance of this Warrant such number of shares of its Common
Stock as shall be required for issuance of the Consideration Warrant
Shares.  Before taking any action that would result in an adjustment in the
number of Consideration Warrant Shares for which this Warrant is exercisable or
in the Exercise Price, the Company shall obtain all such authorizations or
exemptions thereof, or consents thereto, as may be necessary from any public
regulatory body or bodies having jurisdiction over such action.  If any
Consideration Warrant Shares required to be reserved for issuance upon exercise
of Warrants require registration or qualification with any Governmental Entity
(other than under the Securities Act or any state securities law) before such
shares may be so issued, the Company will in good faith and as expeditiously as
possible and at its expense endeavor to cause such shares to be duly
registered.  Before taking any action that would cause an adjustment reducing
the Exercise Price below the then par value (if any) of the shares of Common
Stock deliverable upon exercise of the Warrant or that would cause the number of
Consideration Warrant Shares issuable upon exercise of the Warrant to exceed
(when taken together with all other Outstanding shares of Common Stock) the
number of Consideration Warrant Shares that the Company is authorized to issue,
the Company will take any corporate action that, in the opinion of its counsel,
is necessary in order that the Company may validly and legally issue the full
number of fully paid and non-assessable shares of Common Stock issuable upon
exercise of the Warrant at such adjusted exercise price.
 
 

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4.      Transfer, Assignment, Division, Combination, Mutilation or Loss of
Warrant.

4.1    Transfer or Assignment of Warrant.  Subject to the limitations set forth
in Section 7 hereof, upon (a) surrender of this Warrant to the Company at its
Designated Office accompanied by a Form of Assignment annexed hereto as Annex B
(each, a “Form of Assignment”) duly executed and funds sufficient to pay any
applicable transfer tax, and (b) delivery of an opinion of counsel to the Holder
reasonably satisfactory to the Company to the effect that, in the opinion of
such counsel, the transfer is exempt from the registration requirements of the
Securities Act (provided that no such opinion shall be required in the event of
a Transfer to a Permitted Transferee), the Company shall, without charge,
execute and deliver a new Warrant registered in the name of the assignee named
in the Form of Assignment at the address, and evidencing the right to purchase
the shares of Common Stock, specified in the Form of Assignment, and the Warrant
represented by this Warrant shall promptly be cancelled.

4.2    Mutilation or Loss of Warrant.  Upon receipt by the Company of evidence
satisfactory to it of the loss, theft, destruction or mutilation of this
Warrant, and (in the case of loss, theft or destruction) receipt of reasonably
satisfactory indemnification, and (in the case of mutilation) upon surrender and
cancellation of this Warrant, the Company will execute and deliver a new Warrant
of like tenor and date and any such lost, stolen, destroyed or mutilated Warrant
shall thereupon become void.

4.3    Division and Combination.  Subject to compliance with the applicable
provisions of this Warrant, this Warrant may be divided or combined with other
Warrants upon presentation hereof at the Designated Office, together with a
written notice specifying the names and denominations in which new Warrants are
to be issued, signed by the Holder or its agent or attorney.  Subject to
compliance with the applicable provisions of this Warrant as to any transfer
which may be involved in such division or combination, the Company shall execute
and deliver a new Warrant or Warrants in exchange for the Warrant or Warrants to
be divided or combined in accordance with such notice.

4.4    Expenses.  The Company shall prepare, issue and deliver at its own
expense any new Warrant or Warrants required to be issued hereunder.

4.5    Maintenance of Books.  The Company agrees to maintain, at the Desig­nated
Office, books for the registration and transfer of the Warrants.

5.      Rights of the Holder.  The Holder shall not, by virtue hereof, be
entitled to any rights of a stockholder in the Company, either at law or equity,
and the rights of the Holder are limited to those expressed in this Warrant and
are not enforceable against the Company except to the extent set forth herein.

6.      Protection Against Dilution and Other Adjustments.

6.1    Adjustment of Number of Shares Purchasable. Upon any adjustment of the
Exercise Price as provided in Sections 6.3 through 6.6 hereof, the Holders of
the Warrants shall thereafter be entitled to purchase upon the exercise thereof,
at the Exercise Price resulting from such adjustment, the number of shares of
Common Stock (calculated to the nearest 1/100th of a share) obtained by
multiplying the Exercise Price in effect immediately prior to such adjustment by
the number of shares of Common Stock issuable on the exercise hereof immediately
prior to such adjustment and dividing the product thereof by the Exercise Price
resulting from such adjustment.

6.2    Adjustment Upon Spin Off.  If, at any time or from time to time after the
Original Issue Date, the Company shall spin off or otherwise divest itself of a
part of its business or operations or dispose of all or of a part of its assets
in a transaction in which the Company does not receive compensation for such
business, operations or assets, but causes securities of another entity (the
“Spin Off Securities”) to be issued to security holders of the Company, then the
Company shall cause (i) to be reserved a number of Spin Off Securities (the
"Reserved Spin
 
 

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Off Securities") equal to the number of Spin Off Securities that would have been
issued to the Holder had all of the Holder’s Outstanding Warrants on the record
date for determining the number of Spin Off Securities to be issued to
stockholders of the Company been exercised as of the close of business on the
trading day immediately before such record date, and (ii) to be issued to the
Holder on the exercise of all or any of the Outstanding Warrants, a number
of  Reserved Spin Off Securities equal to (x) the Reserved Spin Off Securities
multiplied by (y) a fraction, the numerator of which shall be the amount of the
Outstanding Warrants then being exercised, and the denominator of which shall be
the amount of the Outstanding Warrants.

6.3    Upon Stock Dividends, Subdivisions or Splits.  If, at any time or from
time to time after the Original Issue Date, the number of shares of Common Stock
Outstanding is increased by a stock dividend payable in shares of Common Stock
or by a subdivision or split-up of shares of Common Stock, then, following the
record date for the determination of holders of Common Stock entitled to receive
such stock dividend, or to be affected by such subdivision or split-up, the
Exercise Price shall be appropriately decreased by multiplying the Exercise
Price by a fraction, the numerator of which is the number of shares of Common
Stock Outstanding immediately prior to, and the denominator of which is the
number of shares of Common Stock Outstanding immediately after, such increase in
Outstanding shares.

6.4    Upon Combinations or Reverse Stock Splits.  If, at any time or from time
to time after the Original Issue Date, the number of shares of Common Stock
Outstanding is decreased by a combination or reverse stock split of the
Outstanding shares of Common Stock into a smaller number of shares of Common
Stock, then, following the record date to determine shares affected by such
combination or reverse stock split, the Exercise Price shall be appropriately
increased by multiplying the Exercise Price by a fraction, the numerator of
which is the number of shares of Common Stock Outstanding immediately prior to,
and the denominator of which is the number of shares of Common Stock Outstanding
immediately after, such decrease in Out­standing shares.

6.5    Upon Reclassifications, Reorganizations, Consolidations or Mergers.  If,
at any time or from time to time after the Original Issue Date, there is any
capital reorganization of the Company, any reclassification of the stock of the
Company (other than a change in par value or from par value to no par value or
from no par value to par value or as a result of a stock dividend or
subdivision, split-up or combination of shares), or any consolidation or merger
of the Company with or into another Person (where the Company is not the
surviving Person or where there is a change in or distribution with respect to
the Common Stock), each Warrant shall after such reorganization,
reclassification, consolidation, or merger be exercisable for the kind and
number of shares of stock or other securities or property of the Company or of
the successor Person resulting from such consolidation or surviving such merger,
if any, to which the holder of the Consideration Warrant Shares deliverable
(immediately prior to the time of such reorganization, reclassification,
consolidation or merger) upon exercise of such Warrant would have been entitled
upon such reorganization, reclassification, consolidation or merger.  The
provisions of this clause shall similarly apply to successive reorganizations,
reclassifications, consolidations, or mergers.  The Company shall not effect any
such reorganization, reclassification, consolidation or merger unless, prior to
the consummation thereof, the successor Person (if other than the Company)
resulting from such reorganization, reclassification, consolidation or merger,
shall assume, by written instrument, the obligation to deliver to the Holders of
the Warrant such shares of stock, securities or assets, which, in accordance
with the foregoing provisions, such Holders shall be entitled to receive upon
such conversion.

6.6    Upon Issuance of Common Stock.  If, at any time or from time to time
after the Original Issue Date, the Company shall issue any shares of Common
Stock, options to purchase or rights to subscribe for Common Stock, securities
by their terms convertible into or exchangeable for Common Stock, or options to
purchase or rights to subscribe for such convertible or exchangeable securities,
other than Excluded Stock, without consideration or for consideration per share
less than either (x) the Exercise Price in effect immediately prior to such
issuance or (y) the Fair Market Value per share of the Common Stock immediately
prior to such issuance, then such Exercise Price shall forthwith be lowered to a
price equal to the price obtained by multiplying:
 
 
 

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(i) the Exercise Price in effect immediately prior to the issuance of such
Common Stock, options, rights or securities by

(ii) a fraction of which (x) the numerator shall be the sum of (A) the number of
shares of Common Stock Outstanding on a fully-diluted basis immediately prior to
such issuance and (B) the number of additional shares of Common Stock which the
aggregate consideration for the number of shares of Common Stock so offered
would purchase at the greater of the Exercise Price  in effect immediately prior
to such issuance or the Fair Market Value per share of Common Stock and (y) the
denominator shall be the number of shares of Common Stock Outstanding on a
fully-diluted basis immediately after such issuance.

6.7    Provisions Applicable to Adjustments.  For purposes of any adjustment of
the Exercise Price pursuant to Section 6.6 hereof, the following provisions
shall be applicable:

(i) In the case of the issuance of Common Stock for cash in a public offering or
private placement, the consideration shall be deemed to be the amount of cash
paid therefor before deducting therefrom any discounts, commissions or placement
fees payable by the Company to any underwriter or placement agent in connection
with the issuance and sale thereof.

(ii) In the case of the issuance of Common Stock for a consideration in whole or
in part other than cash, the consideration other than cash shall be deemed to be
the Valuation Amount as determined in accordance with the Appraisal Procedure.

(iii) In the case of the issuance of options to purchase or rights to subscribe
for Common Stock, securities by their terms convertible into or exchangeable for
Common Stock, or options to purchase or rights to subscribe for such convertible
or exchangeable securities (except for options to acquire Excluded Stock):

(A) the aggregate maximum number of shares of Common Stock deliverable upon
exercise of such options to purchase or rights to subscribe for Common Stock
shall be deemed to have been issued at the time such options or rights were
issued and for a consideration equal to the consideration (determined in the
manner provided in subparagraphs (i) and (ii) above), if any, received by the
Company upon the issuance of such options or rights plus the minimum purchase
price provided in such options or rights for the Common Stock covered thereby;

(B) the aggregate maximum number of shares of Common Stock deliverable upon
conversion of or in exchange for any such convertible or exchangeable securities
or upon the exercise of options to purchase or rights to subscribe for such
convertible or exchangeable securities and subsequent conversion or exchange
thereof shall be deemed to have been issued at the time such securities,
options, or rights were issued and for a consideration equal to the
consideration received by the Company for any such securities and related
options or rights (excluding any cash received on account of accrued interest or
accrued dividends), plus the minimum additional consideration, if any, to be
received by the Company upon the conversion or exchange of such securities or
the exercise of any related options or rights (the consideration in each case to
be determined in the manner provided in paragraphs (i) and (ii) above);

(C) on any change in the number of shares or exercise price of Common Stock
deliverable upon exercise of any such options or rights or conversions of or
exchanges for such securities, other than a change resulting from the
anti-dilution provisions thereof, the Exercise Price shall forthwith be
readjusted to such Exercise Price as would have been obtained had the adjustment
made upon the issuance of such options, rights or securities not converted prior
to such change or options or rights related to such securities not converted
prior to such change been made upon the basis of such change;

(D) upon the expiration of any options to purchase or rights to subscribe for
Common Stock which shall not have been exercised, the Exercise Price computed
upon the issuance thereof (or upon the occurrence of a record date
 
 

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with respect thereto), and any subsequent adjustments based thereon, shall, upon
such expiration, be recomputed as if the only additional shares of Common Stock
issued were the shares of Common Stock, if any, actually issued upon the
exercise of such options to purchase or rights to subscribe for Common Stock,
and the consideration received therefor was the consideration actually received
by the Company for the issue of the options to purchase or rights to subscribe
for Common Stock that were exercised, plus the consideration actually received
by the Company upon such exercise; and

(E) no further adjustment of the Exercise Price adjusted upon the issuance of
any such options, rights, convertible securities or exchangeable securities
shall be made as a result of the actual issuance of Common Stock on the exercise
of any such rights or options or any conversion or exchange of any such
securities.

6.8    Deferral in Certain Circumstances.  In any case in which the provisions
of this Section 6 shall require that an adjustment shall become effective
immediately after a record date of an event, the Company may defer until the
occurrence of such event (a) issuing to the Holder of any Warrant exercised
after such record date and before the occurrence of such event the shares of
capital stock issuable upon such exercise by reason of the adjustment required
by such event and issuing to such Holder only the shares of capital stock
issuable upon such exercise before giving effect to such adjustments, and (b)
paying to such Holder any amount in cash in lieu of a fractional share of
capital stock pursuant to Section 2.3 above; provided, however, that the Company
shall deliver to such Holder an appropriate instrument or due bills evidencing
such Holder’s right to receive such additional shares or such cash.

6.9    Appraisal Procedure.  In any case in which the provisions of this Section
6 shall necessitate that the Appraisal Procedure be utilized for purposes of
determining an adjustment to the Exercise Price, the Company may defer until the
completion of the Appraisal Procedure and the determination of the adjustment
(a) issuing to the Holder of any Warrant exercised after the date of the event
that requires the adjustment and before completion of the Appraisal Procedure
and the determination of the adjustment, the shares of capital stock issuable
upon such exercise by reason of the adjustment required by such event and
issuing to such Holder only the shares of capital stock issuable upon such
exercise before giving effect to such adjustment and (b) paying to such Holder
any amount in cash in lieu of a fractional share of capital stock pursuant to
Section 2.3 above; provided, however, that the Company shall deliver to such
Holder an appropriate instrument or due bills evidencing such Holder’s right to
receive such additional shares or such cash.

6.10    Exceptions.  This Section 6 shall not apply to (a) securities offered to
the public pursuant to a public offering; (b) securities issued to employees or
directors of the Company pursuant to an employee stock option plan or stock
incentive plan approved by the Board of Directors; or (c) securities Outstanding
as of the date hereof (provided that the terms of such securities will not be
modified in any manner following the date hereof) (collectively, "Excluded
Stock").

6.11    Notice of Adjustment of Exercise Price.  Whenever the Exercise Price is
adjusted as herein provided:

(i) the Company shall compute the adjusted Exercise Price in accor­dance with
this Section 6 and shall prepare a certificate signed by the treasurer or chief
financial officer of the Company setting forth the adjusted Exercise Price and
showing in reasonable detail the facts upon which such adjustment is based, and
such certificate shall forthwith be filed at each Designated Office; and

(ii) a notice stating that the Exercise Price has been adjusted and setting
forth the adjusted Exercise Price shall forthwith be prepared by the Company and
mailed to all Holders at their last addresses as they shall appear in the
warrant register.
 
 

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7.      Transfer to Comply with the Securities Act.

7.1    Transfer.  This Warrant has not been registered under the Securities Act
and has been issued to the Holder for investment and not with a view to the
distribution of either the Warrant or the Consideration Warrant Shares.  Neither
this Warrant nor any of the Consideration Warrant Shares or any other security
issued or issuable upon exercise of this Warrant may be sold, transferred,
pledged or hypothecated in the absence of an effective registration statement
under the Securities Act relating to such security or an opinion of counsel
satisfactory to the Company that registration is not required under the
Securities Act; provided, that, no registration statement or opinion of counsel
shall be required in the event of a Transfer to a Permitted Transferee.  Each
Warrant, the Consideration Warrant Shares and any other security issued or
issuable upon exercise of this Warrant shall contain a legend on the face
thereof, in substantially the following form by which the Holder (and any
transferee thereof) shall be bound:

THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR ANY OTHER SECURITIES LAWS, AND SUCH
SECURITIES MAY NOT BE SOLD, PLEDGED, HYPOTHECATED OR OTHERWISE TRANSFERRED IN
THE ABSENCE OF SUCH REGISTRATION UNDER SAID ACT AND LAWS OR AN EXEMPTION
THEREFROM.

8.      Notice of Corporate Actions; Taking of Record; Transfer Books.

8.1    Notices of Corporate Actions.  In case:

(a) of the Company granting to all of the holders of its Common Stock rights or
warrants to subscribe for or purchase any shares of capital stock of any class;
or

(b) of any reclassification of the Common Stock (other than a subdivision or
combination of the Outstanding shares of Common Stock), or of any consolidation,
merger or share exchange to which the Company is a party and for which approval
of any stockholders of the Company is required, or of the sale or transfer of
all or substantially all of the assets of the Company; or

(c) of the voluntary or involuntary dissolution, liquidation or winding up of
the Company; or

(d) of the commencement by the Company or any Subsidiary of a tender offer for
all or a portion of the Outstanding shares of Common Stock (or the amending of
any such tender offer to change the maximum number of shares being sought or the
amount or type of consideration being offered therefor);

then the Company shall cause to be filed at each office or agency maintained for
such purpose, and shall cause to be mailed to all Holders at their last
addresses as they shall appear in the warrant register, at least 30 days prior
to the applicable record, effective or expiration date hereinafter specified, a
notice stating (x) the date on which a record is to be taken for the purpose of
such dividend, distribution or granting of rights or warrants, or, if a record
is not to be taken, the date as of which the holders of Common Stock of record
who will be entitled to such dividend, distribution, rights or warrants are to
be determined, (y) the date on which such reclassification, consolidation,
merger, share exchange, sale, transfer, dissolution, liquidation or winding up
is expected to become effective, and the date as of which it is expected that
holders of Common Stock of record shall be entitled to exchange their shares of
Common Stock for securities, cash or other property deliverable upon such
reclassification, consolidation, merger, share exchange, sale, transfer,
dissolution, liquidation or winding up, or (z) the date on which such tender
offer commenced, the date on which such tender offer is scheduled to expire
unless extended, the consideration offered and the other material terms thereof
(or the material terms of the amendment thereto).  Such notice shall also set
forth such facts with respect thereto as shall be reasonably necessary to
indicate the effect of such action on the Exercise Price and the number and kind
or class of shares or other securities or
 
 

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property which shall be deliverable or purchasable upon the occurrence of such
action or deliverable upon exercise of the Warrants.  Neither the failure to
give any such notice nor any defect therein shall affect the legality or
validity of any action described in clauses (a) through (d) of this Section 8.1.
 
8.2    Taking of Record.  In the case of all dividends or other distributions by
the Company to the holders of its Common Stock with respect to which any
provision of hereof refers to the taking of a record of such holders, the
Company will in each such case take such a record and will take such record as
of the close of business on a Business Day.

8.3    Closing of Transfer Books.  The Company shall not at any time, except
upon dissolution, liquidation or winding up of the Company, close its stock
transfer books or Warrant transfer books so as to result in preventing or
delaying the exercise or transfer of any Warrant.

9.    Notices.  Any notice or other communication required or permitted
hereunder shall be in writing and shall be delivered personally, telegraphed,
telexed, sent by facsimile transmission or sent by certified, registered or
express mail, postage pre-paid.  Any such notice shall be deemed given when so
delivered personally, telegraphed, telexed or sent by facsimile transmission,
or, if mailed, two days after the date of deposit in the United States mails, as
follows:

(i)     if to the Company, to:

SIGA Technologies, Inc.
420 Lexington Avenue, Suite 408
New York, New York 10170
Attention:  Ayelet Dugary
Telephone No.:  (212) 672-9100
Facsimile No.:   (212) 697-3130

with a copy (which shall not constitute notice) to:

Kramer Levin Naftalis & Frankel LLP
1177 Avenue of the Americas
New York, New York 10036
Attention:  James A. Grayer, Esq.
Facsimile No.: (212) 715-8000

(ii)   if to the Holder, to:

MacAndrews & Forbes LLC
35 East 62nd Street
New York, New York 10021
Attention: Barry F. Schwartz, Esq.
Facsimile No.: (212) 572-8435

Any party may be given notice in accordance with this Section 9, unless such
party designates another address or person for receipt of notice hereunder.

10.    No Impairment; Regulatory Compliance And Cooperation; Notice Of
Expiration.  The Company shall not by any action, including, without limitation,
amending its charter documents or through any reorganization, reclassification,
transfer of assets, consolidation, merger, dissolution, issue or sale of
securities or any other similar voluntary action, avoid or seek to avoid the
observance or performance of any of the terms of this Warrant, but will
 
 

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at all times in good faith assist in the carrying out of all such terms and in
the taking of all such actions as may be necessary or appropriate to protect the
rights of the Holder against impairment.

11.      Miscellaneous.

11.1    Successors and Assigns. This Warrant shall inure to the benefit of and
be binding upon the successors and assigns of  the Company, the Holder and their
respective successors and assigns.  The Holder's rights under this Warrant may
be assigned, in whole or in part, to (a) any Permitted Transferee, and any
Permitted Transferee shall be deemed to be a Holder for all purposes hereunder
or (b) any transferee of a Warrant, or, if applicable, any portion of a Warrant,
that represents (x) the greater of (A) 10% of the Consideration Warrant Shares
exercisable by such transferor on the date of such transfer and (B) 29, 411
Consideration Warrant Shares (subject to adjustment as set forth herein) or (y)
if the transferor shall then hold Warrants representing less than 29,411
Consideration Warrant Shares (subject to adjustment as set forth herein), all of
the Warrants held by such transferor, and any such transferee shall be deemed to
be a Holder for all purposes hereunder.

11.2    Limitation on Exercise.  Notwithstanding anything to the contrary
contained herein, the maximum number of shares of Common Stock that the Company
may issue pursuant to the Commitment Letter or any other documentation
contemplated under the Commitment Letter at an effective purchase price less
than the greater of book or market value of the Company's Common Stock on the
trading day immediately preceding the date of the Commitment Letter equals
19.99% of the outstanding shares of Common Stock immediately preceding the date
of the Commitment Letter (the "Issuable Maximum"), unless the Company obtains
shareholder approval in accordance with the rules and regulations of the Nasdaq
Stock Market.  If, at the time any Holder requests an exercise of any of the
Warrants, the Actual Minimum (excluding any shares issued or issuable at an
effective purchase price in excess of the greater of book or market value of the
Company's Common Stock on the trading day immediately preceding the date of the
Commitment Letter) exceeds the Issuable Maximum (and if the Company has not
previously obtained the required shareholder approval), then the Company shall
issue to such Holder requesting such exercise a number of shares of Common Stock
equal to the Issuable Maximum.  The Company shall not be obligated to seek
stockholder approval under the rules and regulations of the Nasdaq Stock Market
and shall not be in breach under this Warrant Agreement, the Commitment Letter
or any other documentation contemplated under the Commitment Letter for failure
to issue securities as a result of its failure to obtain shareholder approval as
contemplated hereby.  For purposes hereof, "Actual Minimum" shall mean, as of
any date, the maximum aggregate number of shares of Common Stock then issued or
potentially issuable in the future pursuant to the Commitment Letter or any
other documentation contemplated under the Commitment Letter, without giving
effect to any limits on the number of shares of Common Stock that may be owned
by a Holder at any one time.

11.3    Designated Office.  As long as any of the Warrants remain Outstanding,
the Company shall maintain an office or agency, which may be the principal
executive offices of the Company (the "Desig­nated Office"), where the Warrants
may be presented for exercise, registration of transfer, division or combination
as provided in this Warrant.  Such Designated Office shall initially be the
office of the Company at 420 Lexington Avenue, Suite 408, New York, New York
10170.  The Company may from time to time change the Designated Office to
another office of the Company or its agent within the United States by notice
given to all registered Holders at least 10 Business Days prior to the effective
date of such change.

11.4    Supplements and Amendments; Whole Agreement.  This Warrant may be
amended or supplemented only by an instrument in writing signed by the parties
hereto.  This Warrant, the Commitment Letter and Subscription Agreement contain
the full understanding of the parties hereto with respect to the subject matter
hereof and thereof and there are no representations, warranties, agreements or
understandings other than expressly contained herein and therein.
 
 
 

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11.5    Governing Law; Jurisdiction; Waiver Of Jury Trial.  The internal laws,
and not the laws of conflicts (other than Section 5-1401 of the General
Obligations Law of the State of New York), of New York shall govern the
enforceability and validity of this Warrant, the construction of its terms and
the interpretation of the rights and duties of the Company.  Any suit, action or
proceeding seeking to enforce any provision of, or based on any matter arising
out of or in connection with, this Warrant or the transactions contemplated
hereby may be brought in any federal or state court located in the County and
State of New York, and the Company hereby consents to the jurisdiction of such
courts (and of the appropriate appellate courts therefrom) in any such suit,
action or proceeding and irrevo­cably waives, to the fullest extent permitted by
law, any objection which it may now or hereafter have to the laying of the venue
of any such suit, action or proceeding in any such court or that any such suit,
action or proceeding which is brought in any such court has been brought in an
inconvenient forum.  Process in any such suit, action or proceeding may be
served on the company anywhere in the world, whether within or without the
jurisdiction of any such court.  The Company hereby irrevocably waives any and
all right to trial by jury in any legal proceeding arising out of or related to
this Warrant or the transactions contemplated hereby.

11.6    Remedies.  Each Holder of Warrants, in addition to being entitled to
exercise its rights granted by law, including recovery of damages, shall be
entitled to specific performance of its rights provided under this Warrant.  The
Company agrees that monetary damages would not be adequate compensation for any
loss incurred by reason of a breach by it of the provisions of this Warrant and
shall  waive, in an action for specific performance, the defense that a remedy
at law would be adequate.

11.7    Limitation of Liability.  No provision hereof and no enumeration herein
of the rights or privileges of the Holder hereof, shall give rise to any
liability of such Holder to pay the Exercise Price for any Consideration Warrant
Shares other than pursuant to an exercise of this Warrant or any liability as a
stockholder of the Company, whether such liability is asserted by the Company or
by creditors of the Company.

11.8    Severability.  Wherever possible, each provision of this Warrant shall
be interpreted in such manner as to be effective and valid under applicable law,
but if any provision of this Warrant shall be prohibited by or invalid under
applicable law, such provision shall be ineffective to the extent of such
prohibition or invalidity, without invalidating the remainder of such provision
or the remaining provisions of this Warrant.

11.9    Descriptive Headings.  Descriptive headings of the several sections of
this Warrant are inserted for convenience only and shall not control or affect
the meaning or construction of any of the provisions hereof.

[Remainder of Page Intentionally Left Blank]

 
 

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IN WITNESS WHEREOF, this Warrant has been executed as of the 30th day of April,
2009.

            SIGA TECHNOLOGIES, INC.

            By: /s/ Ayelet Dugary
                  Ayelet Dugary
                  Chief Financial Officer

 
 

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ANNEX A

NOTICE OF EXERCISE OF WARRANT

[To be executed only upon exercise of Warrant]

The undersigned hereby irrevocably elects to exercise the right, represented by
the Warrant dated as of April ___, 2009, to purchase ______ shares of common
stock, par value $0.0001 per share (the "Consideration Warrant Shares"), of SIGA
TECHNOLOGIES, INC. and tenders herewith payment in accordance with Sections 1
and 2 of such Warrant.  The undersigned further requests, in accordance with
Section 2.1(b) of the Warrant, that certificates for the Consideration Warrant
Shares hereby purchased (and any securities or other property issuable upon
exercise) be issued in the name of and delivered to ______________ and, if such
Consideration Warrant Shares are not all of the Consideration Warrant Shares
issuable upon exercise of the Warrant, that a new Warrant of like tenor be
issued for the balance of the Consideration Warrant Shares.

        _______________________________
        (Name of Registered Owner)

        _______________________________
        (Signature of Registered Owner)

        _______________________________
        (Street Address)

        _______________________________
        (City)    (State)    (Zip Code)

NOTICE:
The signature on this subscription must correspond with the name as written upon
the face of the within Warrant in every particular, without alteration or
enlarge­ment or any change whatsoever.

 
 

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ANNEX B

FORM OF ASSIGNMENT

(To be executed by the registered holder if such
holder desires to transfer the Warrant.)

FOR VALUE RECEIVED ________________ hereby sells, assigns and transfers unto
______________________________________________________________

________________________________________________________________________________________________________________________________
(Please print name and address of transferee)

the Warrants represented by this Warrant, together with all right, title and
interest therein, and does hereby irrevocably constitute and appoint
___________________________ attorney-in-fact, with full power of substitution,
to transfer the within Warrant on the books of SIGA TECHNOLOGIES, INC. to give
effect to the transfer made hereby.

Date:  _____________, ____

                _________________________________
                        Signature

NOTICE:
The signature on this assignment must correspond with the name as written upon
the face of the within Warrant in every particular, without alteration or
enlarge­ment or any change whatsoever.