kl06023_ex10-2.htm


    
      

    

     

    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, 238,000 fully paid and nonassessable
shares of Common Stock, at an initial exercise price per share (the “Exercise
Price”) of $3.06 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 “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 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.

     

    "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.

     

     

    
      
        
        

      

      
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    "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 June 19, 2012.

     

    "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.

     

    "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 June 19, 2008.

     

    "Original
Warrants" means the Warrants originally issued by the Company on June 19, 2008,
pursuant to the Commitment Letter.

     

     

     

    
      
        
        

      

      
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    "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.

     

    "Registration
Rights Agreement" means the Registration Rights Agreement by and between the
Company and MacAndrews & Forbes LLC (formerly known as MacAndrews &
Forbes Holdings Inc.), dated August 13, 2003, as amended from time to
time.

     

    "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.

     

    "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.

     

    "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 

     

     

    
      
        
        

      

      
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    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 Warrant Shares being purchased
upon exercise of this Warrant pursuant to Sections 1 and 2 hereof, multiplied by
(ii) the Exercise Price.

     

    "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 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 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 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 Warrant Shares being issued,
deliver to the Holder a new Warrant evidencing the rights of the Holder to
purchase the remaining 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 Warrant Shares shall be 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 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

     

     

    
      
        
        

      

      
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    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 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
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 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 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 Warrant Shares.  Before taking
any action that would result in an adjustment in the number of 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 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

     

     

     

    
      
        
        

      

      
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    number of
Warrant Shares issuable upon exercise of the Warrant to exceed (when taken
together with all other Outstanding shares of Common Stock) the number 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.

     

    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 

     

     

    
      
        
        

      

      
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    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 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

     

     

     

    
      
        
        

      

      
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    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 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:

     

    (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

     

     

     

    
      
        
        

      

      
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    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,

     

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

     

     

     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 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

     

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

     

     

    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.

     

    7.    Transfer to Comply with the
Securities Act; Registration Rights.

     

    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 Warrant Shares.  Neither this Warrant nor any of the
Warrant Shares or any other security issued or issuable upon exercise of this
Warrant may be

     

     

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

     

     

    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 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.

     

    7.2    Registration
Rights.  Reference is made to the Registration Rights
Agreement.  The Company’s obligations under the Registration Rights
Agreement and the other terms and conditions thereof with respect to the Warrant
Shares, including, but not limited to, the Company’s commitment to file
registration statements including the Warrant Shares, to have the registration
of the Warrant Shares completed and effective, and to maintain such
registration, are incorporated herein by reference.

     

    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);

     

     

     

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

     

    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 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:  Thomas N.
Konatich

    Telephone No.:  (212)
672-9100

    Facsimile No.:   (212)
697-3130

     

     

     

    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

    

    


    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

    


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

    


    Skadden, Arps, Slate, Meagher &
Flom LLP

    Four Times Square

    New York, New
York  10035

    Attention:  Franklin M.
Gittes, Esq. and

                                                                    Alan
C. Myers, Esq.

    Facsimile No.:  (212)
735-2000

    


    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 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

     

     

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

    

     

     

    applicable,
any portion of a Warrant, that represents (x) the greater of (A) 10% of the
Warrant Shares exercisable by such transferor on the date of such transfer and
(B) 34,149 Warrant Shares (subject to adjustment as set forth herein) or (y) if
the transferor shall then hold Warrants representing less than 34,149 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 the Registration Rights Agreement contain the
full understanding of the parties hereto with respect to the subject matter
hereof

     

     

    
      
        
        

      

      
        16

        
          

        

      

      
        
        

      

    

     

     

    and
thereof and there are no representations, warranties, agreements or
understandings other than expressly contained herein and therein.

     

    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 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]

     


    
      
         


      

      
        17

        
          

        

      

      
         


      

    


    


     

    IN
WITNESS WHEREOF, this Warrant has been executed as of the ___ day of ____,
200_.

     

                SIGA TECHNOLOGIES,
INC.

    


    


    


                By:___________________ 

                Name:

                Title: 

     

    
 


    
      
         


      

      
        18

        
          

        

      

      
         


      

    


    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 June 19, 2008, to purchase ______ shares of common stock,
par value $0.0001 per share (the "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 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 Warrant Shares are not all
of the Warrant Shares issuable upon exercise of the Warrant, that a new Warrant
of like tenor be issued for the balance of the 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.

            


    

    


    



    
      
         


      

      
        19

        
          

        

      

      
         


      

    


     

    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.

            


    

     

     

    
 

    20