kl03017_ex10-1.htm


    
      

    


    EXHIBIT
10.1

     

    EMPLOYMENT
AGREEMENT

     

    THIS
AGREEMENT (the “Agreement”), made in New York, New York as of January 22, 2007,
between SIGA Technologies, Inc., a Delaware corporation (the “Company”),
and Ayelet Dugary
(“Executive”).

     

    WHEREAS,
the Company desires to employ Executive as its Director of Finance and
Controller, and Executive desires to accept such employment on the terms and
conditions hereinafter set forth;

     

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

     

    1.    Term.  Unless
earlier terminated in accordance with Section 4 hereof, the term of this
Agreement shall be the one-year period commencing as of the date hereof and
ending on January 22, 2008 (the “Term” and such
year, a “Term Year”). In addition, unless either party hereto provides notice of
its desire not to renew this Agreement thirty (30) days prior to the expiration
of the Term, this Agreement shall automatically renew for additional one (1)
year periods commencing upon the expiration of the initial Term (or any such
subsequent Term), with each such additional year thereafter being made part of
the Term and each such additional year, thereafter a Term Year.

     

    2.    Employment.

     

    (a)    Employment by the Company;
Director.  Executive agrees to be employed by the Company
during the Term upon the terms and subject to the conditions set forth in this
Agreement.  Executive shall serve as the Director of Finance and
Controller of the Company and shall report to the Board of Directors and
Chief Financial Officer of the Company.

     

    (b)    Performance of
Duties.  Throughout her employment with the Company, Executive
shall faithfully and diligently perform Executive’s duties in conformity with
the directions of the Company and serve the Company to the best of Executive’s
ability.  Executive shall devote her full business time and best
efforts to the business and affairs of the Company.  In her capacity
as the Director of Finance and Controller of the Company, Executive shall have
such duties and responsibilities as he may be assigned by the Board of Directors and
Chief Financial Officer of the Company not inconsistent with her position as
Director of Finance and Controller of the
Company.

     

    3.    Compensation and
Benefits.

     

    (a)    Base
Salary.  The Company agrees to pay to Executive a base salary
(“Base Salary”) at the annual rate of $180,000, subject to any cost of living
adjustments as may be approved by the Board of Directors of the
Company.  Payments of the Base Salary shall be payable in equal
installments in accordance with the Company’s standard payroll
practices.

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

     

    (b)    Annual
Bonus.   The Company will pay Executive an annual cash
bonus of $40,000.  The Company may also, in its sole discretion, pay
to Executive an additional bonus in an amount to be determined by the Board of
Directors in its sole discretion.  Such  additional bonus,
if any, may be payable in cash or options to purchase Common Stock or restricted
shares of Common Stock, as determined by the Board of Directors in its sole
discretion.  Any such cash bonus shall be paid, and any such options
or restricted shares shall be issued, no later than March 15 of the year
following the year in which the Board of Directors determined such bonus, or, if
later, by the date that is 21⁄2 months following the end of the Company’s fiscal
year in which the Board of Directors determined such bonus.

     

    (c)    Benefits and
Perquisites.  Executive shall be entitled to participate in, to
the extent Executive is otherwise eligible under the terms thereof, the benefit
plans and programs, and receive the benefits and perquisites, generally provided
by the Company to senior executives of the Company, including without limitation
family medical insurance (subject to applicable employee
contributions).  Executive shall be entitled to receive vacation days
in accordance with Company policy, such days to be accrued in accordance with
Company policy.

     

    (d)    Business
Expenses.  The Company agrees to reimburse Executive for all
reasonable and necessary travel, business entertainment and other business
expenses incurred by Executive in connection with the performance of her duties
under this Agreement.  Such reimbursements shall be made by the
Company on a timely basis upon submission by Executive of vouchers in accordance
with the Company’s standard procedures.

     

    (e)    Indemnification.  The
Company shall indemnify Executive, to the fullest extent permitted by its
certificate of incorporation, for any and all liabilities to which he may be
subject as a result of, in connection with or arising out of her employment by
the Company hereunder, as well as the costs and expenses (including reasonable
attorneys’ fees) of any legal action brought or threatened to be brought against
her or the Company as a result of, in connection with or arising out of such
employment or board service.  Executive shall be entitled to the full
protection of any insurance policies which the Company may elect to maintain
generally for the benefit of its officers.

     

    (f)    No Other Compensation or
Benefits; Payment.  The compensation and benefits specified in
this Section 3 and in Section 5 of this Agreement shall be in lieu of any and
all other compensation and benefits.  Payment of all compensation and
benefits to Executive specified in this Section 3 and in Section 5 of this
Agreement (i) shall be made in accordance with the relevant Company policies in
effect from time to time to the extent the same are consistently applied,
including normal payroll practices, and (ii) shall be subject to all legally
required and customary withholdings.

     

    (g)    Cessation of
Employment.  In the event Executive shall cease to be employed
by the Company for any reason, Executive’s compensation and benefits shall cease
on the date of such event, except as otherwise specifically provided herein or
in any applicable employee benefit plan or program or as required by
law.

     

     

     

    
      
        
        

      

      
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    4.    Termination of
Employment.  Executive’s employment hereunder may be terminated
prior to the end of the Term under the following circumstances.

     

    (a)    Death.  Executive’s
employment hereunder shall terminate upon Executive’s death.

     

    (b)    Executive Becoming Totally
Disabled.  The Company may terminate Executive’s employment
hereunder at any time after Executive becomes “Totally Disabled.”  For
purposes of this Agreement, Executive shall be “Totally Disabled” in the event
Executive is unable to perform the duties and responsibilities contemplated
under this Agreement for a period of either (A) 120 consecutive days or (B) 6
months in any 12-month period due to physical or mental incapacity or
impairment.  During any period that Executive fails to perform
Executive’s duties hereunder as a result of incapacity due to physical or mental
illness (the “Disability Period”), Executive shall continue to receive the
compensation and benefits provided by Section 3 of this Agreement until
Executive’s employment hereunder is terminated; provided, however, that the
amount of base compensation and benefits received by Executive during the
Disability Period shall be reduced by the aggregate amounts, if any, payable to
Executive under any disability benefit plan or program provided to Executive by
the Company.

     

    (c)    Termination by the Company
for Cause.  The Company may terminate Executive’s employment
hereunder for Cause at any time after providing written notice to
Executive.  For purposes of this Agreement, the term “Cause” shall
mean any of the following:  (i) Executive’s neglect or failure or
refusal to perform her duties under this Agreement (other than as a result of
total or partial incapacity due to physical or mental illness); (ii) any act by
or omission of Executive constituting gross negligence or willful misconduct in
connection with the performance of her duties that could reasonably be expected
to materially injure the reputation, business or business relationships of the
Company or any of its affiliates; (iii) perpetration of an intentional and
knowing fraud against or affecting the Company or any of its affiliates or any
customer, client, agent, or employee thereof; (iv) the commission by or
indictment of Executive for (A) a felony or (B) any misdemeanor involving moral
turpitude, deceit, dishonesty or fraud (“indictment,” for these purposes,
meaning a United States-based indictment, probable cause hearing or any other
procedure pursuant to which an initial determination of probable or reasonable
cause with respect to such offense is made); (v) the breach of a covenant set
forth in Section 6; or (vi) any other material breach of this
Agreement.

     

    (d)    Termination by the Company
Without Cause.  The Company may terminate Executive’s
employment hereunder at any time for any reason or no reason by giving Executive
thirty (30) days prior written notice of the termination.  Following
any such notice, the Company may reduce or remove any and all of Executive’s
duties, positions and titles with the Company.

     

    (e)    Termination by Executive for
Good Reason.  Executive may terminate her employment hereunder
for Good Reason at any time after providing written notice to the
Company.  For purposes of this Agreement, the term “Good Reason” shall
mean any of the following:  (i) the Company fails to pay the
compensation described in Section 3(a) of this Agreement (in accordance with,
and subject to, such provisions); (ii) Executive no longer holds the office of
Director of Finance and Controller or offices of equivalent
stature, or her functions

     

     

     

    
      
        
        

      

      
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    and/or
duties as Director of Finance and Controller are materially
diminished; or (iii) Executive’s job site is relocated to a location which is
more than fifty (50) miles from New York City, unless the parties mutually agree
to such relocation.

     

    (f)    Termination Upon a Change in
Control.  If the Company terminates Executive’s employment
hereunder without Cause within 90 days after the occurrence of the Change in
Control Executive shall be entitled to the payments provided for by Section
5(d).  For purposes of this Agreement, a “Change in Control” shall be
conclusively deemed to have occurred if any of the following shall have taken
place:

     

    (i)     the
consummation of a transaction or a series of related transactions pursuant to
which any “person” (as such term is used in Sections 13(d) and 14(d)(2) of the
Securities Exchange Act of 1934 (“Exchange Act”), other than the Executive, her
designee(s) or “affiliate(s)” (as defined in Rule 12b-2 under the Exchange Act),
is or becomes the “beneficial owner” (as defined in Rule 13d-3 under the
Exchange Act), directly or indirectly, of securities of the Company representing
forty percent (40%) or more of the combined voting power of the Company’s then
outstanding securities;

     

    (ii)    stockholders
of the Company approve a merger or consolidation of the Company with any other
entity, other than a merger or consolidation which would result in the voting
securities of the Company outstanding immediately prior thereto continuing to
represent (either by remaining outstanding or by being converted into voting
securities of the surviving entity) more than eighty percent (80%) of the
combined voting power of the voting securities of the Company or such surviving
entity outstanding immediately after such merger or consolidation;
or

     

    (iii)   the
stockholders of the Company approve a plan of complete liquidation of the
Company or an agreement for the sale or disposition by the Company of, or the
Company sells or disposes of, all or substantially all of the Company’s
assets.

     

    (g)    Termination by Executive
Without Good Reason.  Executive may terminate her employment
hereunder at any time for any reason or no reason by giving the Company thirty
(30) days prior written notice of the termination.  Following any such
notice, the Company may reduce or remove any and all of Executive’s duties,
positions and titles with the Company, and any such reduction or removal shall
not constitute Good Reason.

     

    5.    Compensation Following
Termination.  In the event that Executive’s employment
hereunder is terminated, Executive shall be entitled only to the following
compensation and benefits upon such termination:

     

    (a)    General.  On
any termination of Executive’s employment prior to the end of the Term,
Executive shall be entitled to the following (collectively, the “Standard
Termination Payments”):

     

    (i)     any
accrued but unpaid Base Salary for services rendered through the date of
termination; provided, however, that in the event Executive’s employment is
terminated pursuant to Section 4(b), the amount of Base Salary received by
Executive during the Disability Period shall be reduced by the aggregate
amounts, if any, payable to

     

     

     

    
      
        
        

      

      
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    Executive
under any disability benefit plan or program provided to Executive by the
Company;

     

    (ii)     any
vacation accrued to the date of termination, in accordance with Company
policy;

     

    (iii)    any
accrued but unpaid expenses through the date of termination required to be
reimbursed in accordance with Section 3(d) of this Agreement; and

     

    (iv)    any
benefits to which he may be entitled upon termination pursuant to the plans,
programs and grants referred to in Section 3(c) hereof in accordance with the
terms of such plans, programs and grants.

     

    (b)    Termination Prior to the
Expiration of the Term by Reason of Death or Executive Becoming Totally
Disabled; Termination Prior to the Expiration of the Term by the Company for
Cause; Termination Prior to the Expiration of the Term by Executive Without Good
Reason.  In the event that Executive’s employment is terminated
prior to the expiration of the Term (i) by reason of Executive’s death pursuant
to Section 4(a) or Executive becoming Totally Disabled pursuant to Section 4(b),
(ii) by the Company for Cause pursuant to Section 4(c) or (iii) by Executive
without Good Reason pursuant to Section 4(g), Executive (or her estate, as the
case may be) shall be entitled only to the Standard Termination
Payments.

     

    (c)    Termination Prior to the
Expiration of the Term by the Company Without Cause; Termination Prior to the
Expiration of the Term by Executive for Good Reason.  In the
event that Executive’s employment is terminated prior to the expiration of the
Term by the Company without Cause pursuant to Section 4(d) or by Executive for
Good Reason pursuant to Section 4(e), Executive shall be entitled only to the
following:

     

    (i)    the
Standard Termination Payments; and

     

    (ii)    the
continued payment of the Base Salary (as determined pursuant to Section 3(a))
for one year (such sums to be paid at the times and in the amounts such Base
Salary would have been paid had Executive’s employment not terminated);
provided, however, that if necessary to comply with Section 409A(a)(2)(B)(i) of
the Internal Revenue Code of 1986, as amended (the “Code”), and applicable
administrative guidance and regulations, the payment of such sums shall be made
as follows:  (A) no payments shall be made for a six-month period
following the date of termination, (B) an amount equal to six months of Base
Salary shall be paid in a lump sum six months following the date of termination,
and (C) during the period beginning six months following the date of termination
through the remainder of the twelve-month period, payment of the Base Salary
shall be made at the times and in the amounts such Base Salary would have been
paid had Executive’s employment not terminated.

     

    (iii)    the
Company shall take all such action as is necessary such that all stock options
and other stock-based grants to Executive shall, immediately and irrevocably
vest and become exercisable as of the date of termination and shall remain
exercisable for a period of not less than one (1) year from the date of
termination.

     

     

     

    
      
        
        

      

      
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    (d)    Termination Upon a Change of
Control.  In the event that the Company terminates Executive’s
employment upon a Change in Control other than for Cause pursuant to Section
4(f), Executive shall be entitled only to the following:

     

    (i)     
the
Standard Termination Payments;

     

    (ii)     the
continued payment of the Base Salary (as determined pursuant to Section 3(a))
for one year (such sums to be paid at the times and in the amounts such Base
Salary would have been paid had Executive’s employment not terminated);
provided, however, that if necessary to comply with Section 409A(a)(2)(B)(i) of
the Internal Revenue Code of 1986, as amended (the “Code”), and applicable
administrative guidance and regulations, the payment of such sums shall be made
as follows:  (A) no payments shall be made for a six-month period
following the date of termination, (B) an amount equal to six months of Base
Salary shall be paid in a lump sum six months following the date of termination,
and (C) during the period beginning six months following the date of termination
through the remainder of the twelve-month period, payment of the Base Salary
shall be made at the times and in the amounts such Base Salary would have been
paid had Executive’s employment not terminated; and

     

    (iii)    the
Company shall take all such action as is necessary such that all stock options
and other stock-based grants to Executive shall, immediately and irrevocably
vest and become exercisable as of the date of termination and shall remain
exercisable for a period of not less than one (1) year from the date of
termination.

     

    (e)    Effect of Material Breach of
Section 6 on Compensation and Benefits Following Termination of Employment
Pursuant to Sections 5(c)(ii) or 5(d)(ii).  If, at the time of
termination of Executive’s employment for any reason prior to the expiration of
the Term or any time thereafter, Executive is in material breach of any covenant
contained in Section 6 hereof, Executive (or her estate, as applicable) shall
not be entitled to any payment (or if payments have commenced, any continued
payment) under Sections 5(c)(ii) or 5(d)(ii).

     

    (f)    No Further Liability;
Release.  Payment made and performance by the Company in
accordance with this Section 5 shall operate to fully discharge and release the
Company and its directors, officers, employees, affiliates, stockholders,
successors, assigns, agents and representatives from any further obligation or
liability with respect to Executive’s employment and termination of
employment.  Other than providing the compensation and benefits
provided for in accordance with this Section 5, the Company and its directors,
officers, employees, affiliates, stockholders, successors, assigns, agents and
representatives shall have no further obligation or liability to Executive or
any other person under this Agreement.  The payment of any amounts
pursuant to this Section 5 (other than payments required by law) is expressly
conditioned upon the delivery by Executive to the Company of a release in form
and substance reasonably satisfactory to the Company of any and all claims
Executive may have against the Company and its directors, officers, employees,
affiliates, stockholders, successors, assigns, agents and representatives
arising out of or related to Executive’s employment by the Company and the
termination of such employment.

     

     

    
      
        
        

      

      
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    6.    Exclusive Employment;
Non-competition; Non-solicitation; Nondisclosure of Proprietary Information;
Surrender of Records; Inventions and Patents; Code of
Ethics.

     

    (a)    No Conflict; No Other
Employment.  During the period of Executive’s employment with
the Company, Executive shall not:  (i) engage in any activity which
conflicts or interferes with or derogates from the performance of Executive’s
duties hereunder nor shall Executive engage in any other business activity,
whether or not such business activity is pursued for gain or profit and
including service as a director of any other company, except as approved in
advance in writing by the Company; provided, however, that Executive shall be
entitled to manage her personal investments and otherwise attend to personal
affairs, including charitable, social and political activities, in a manner that
does not unreasonably interfere with her responsibilities hereunder, or (ii)
accept or engage in any other employment, whether as an employee or consultant
or in any other capacity, and whether or not compensated therefor.

     

    (b)    Non-competition;
Non-solicitation.

     

    (i)     Executive
acknowledges and recognizes the highly competitive nature of the Company’s
business and that access to the Company’s confidential records and proprietary
information renders her special and unique within the Company’s
industry.  In consideration of the payment by the Company to Executive
of amounts that may hereafter be paid to Executive pursuant to this Agreement
(including, without limitation, pursuant to Sections 3 and 5 hereof) and other
obligations undertaken by the Company hereunder, Executive agrees that during
(i) her employment with the Company and (ii) twenty-four months thereafter (the
“Covered Time”), Executive shall not, directly or indirectly, engage (as owner,
investor, partner, stockholder, employer, employee, consultant, advisor,
director or otherwise) in any Competing Business, provided that the provisions
of this Section 6(b) will not be deemed breached merely because Executive owns
less than 1% of the outstanding common stock of a publicly-traded
company.  For purposes of this Agreement, “Competing Business” shall
mean (i) any business in which the Company or its affiliates are currently
engaged anywhere in the world; and (ii) any other business in which the Company
engages in anywhere in the world during the Term.

     

    (ii)    In
further consideration of the payment by the Company to Executive of amounts that
may hereafter be paid to Executive pursuant to this Agreement (including,
without limitation, pursuant to Sections 3 and 5 hereof) and other obligations
undertaken by the Company hereunder, Executive agrees that during her employment
and the Covered Time, he shall not, directly or indirectly, (i) solicit,
encourage or attempt to solicit or encourage any of the employees, agents,
consultants or representatives of the Company or any of its affiliates to
terminate her, her, or its relationship with the Company or such affiliate;
(ii) solicit, encourage or attempt to solicit or encourage any of the
employees, agents, consultants or representatives of the Company or any of its
affiliates to become employees, agents, representatives or consultants of any
other person or entity; (iii) solicit or attempt to solicit any customer, vendor
or distributor of the Company or any of its affiliates with respect to any
product or service being furnished, made, sold or leased by the Company or such
affiliate; or (iv)
persuade or seek to persuade any customer of the Company or any affiliate to
cease to do

     

     

     

    
      
        
        

      

      
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    business
or to reduce the amount of business which any customer has customarily done or
contemplates doing with the Company or such affiliate, whether or not the
relationship between the Company or its affiliate and such customer was
originally established in whole or in part through Executive’s
efforts.  For purposes of this Section 6(b) only, the terms
“customer,” “vendor” and “distributor” shall mean a customer, vendor or
distributor who has done business with the Company or any of its affiliates
within twelve months preceding the termination of Executive’s
employment.

     

    (iii)    During
Executive’s employment with the Company and during the Covered Time, Executive
agrees that upon the earlier of Executive’s (i) negotiating with any Competitor
(as defined below) concerning the possible employment of Executive by the
Competitor, (ii) receiving an offer of employment from a Competitor, or (iii)
becoming employed by a Competitor, Executive will (A) immediately provide notice
to the Company of such circumstances and (B) provide copies of Section 6 of this
Agreement to the Competitor.  Executive further agrees that the
Company may provide notice to a Competitor of Executive’s obligations under this
Agreement, including without limitation Executive’s obligations pursuant to
Section 6 hereof.  For purposes of this Agreement, “Competitor” shall
mean any entity (other than the Company or any of its affiliates) that engages,
directly or indirectly, in any Competing Business.

     

    (iv)    Executive
understands that the provisions of this Section 6(b) may limit her ability to
earn a livelihood in a business similar to the business of the Company or its
affiliates but nevertheless agrees and hereby acknowledges that the
consideration provided under this Agreement, including any amounts or benefits
provided under Sections 3 and 5 hereof and other obligations undertaken by the
Company hereunder, is sufficient to justify the restrictions contained in such
provisions.  In consideration thereof and in light of Executive’s
education, skills and abilities, Executive agrees that he will not assert in any
forum that such provisions prevent her from earning a living or otherwise are
void or unenforceable or should be held void or unenforceable.

     

    (c)    Proprietary
Information.  Executive acknowledges that during the course of
her employment with the Company he will necessarily have access to and make use
of proprietary information and confidential records of the Company and its
affiliates.  Executive covenants that he shall not during the Term or
at any time thereafter, directly or indirectly, use for her own purpose or for
the benefit of any person or entity other than the Company, nor otherwise
disclose, any proprietary information to any individual or entity, unless such
disclosure has been authorized in writing by the Company or is otherwise
required by law.  Executive acknowledges and understands that the term
“proprietary information” includes, but is not limited to:  (a)
inventions, trade secrets, ideas, processes, formulas, source and object codes,
data, programs, other works of authorship, know-how, improvements, research,
discoveries, developments, designs, and techniques regarding any of the
foregoing utilized by the Company or any of its affiliates; (b) the name
and/or address of any customer or vendor of the Company or any of its affiliates
or any information concerning the transactions or relations of any customer or
vendor of the Company or any of its affiliates with the Company or such
affiliate or any of its or their partners, principals, directors, officers or
agents; (c) any information concerning any product, technology, or procedure
employed by the Company or any of its affiliates but not generally known to its
or their customers, vendors or competitors, or

     

     

     

    
      
        
        

      

      
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    under
development by or being tested by the Company or any of its affiliates but not
at the time offered generally to customers or vendors; (d) any information relating
to the pricing or marketing methods, sales margins, cost of goods, cost of
material, capital structure, operating results, borrowing arrangements or
business plans of the Company or any of its affiliates; (e) any information
which is generally regarded as confidential or proprietary in any line of
business engaged in by the Company or any of its affiliates; (f) any business
plans, budgets, advertising or marketing plans; (g) any information contained in
any of the written or oral policies and procedures or manuals of the Company or
any of its affiliates; (h) any information belonging to customers or vendors of
the Company or any of its affiliates or any other person or entity which the
Company or any of its affiliates has agreed to hold in confidence; (i) any
inventions, innovations or improvements covered by this Agreement; and
(j) all written, graphic and other material relating to any of the
foregoing.   Executive acknowledges and understands that
information that is not novel or copyrighted or patented may nonetheless be
proprietary information.  The term “proprietary information” shall not
include information generally available to and known by the public or
information that is or becomes available to Executive on a non-confidential
basis from a source other than the Company, any of its affiliates, or the
directors, officers, employees, partners, principals or agents of the Company or
any of its affiliates (other than as a result of a breach of any obligation of
confidentiality).

     

    (d)    Confidentiality and
Surrender of Records.  Executive shall not during the Term or
at any time thereafter (irrespective of the circumstances under which
Executive’s employment by the Company terminates), except as required by law,
directly or indirectly publish, make known or in any fashion disclose any
confidential records to, or permit any inspection or copying of confidential
records by, any individual or entity other than in the course of such
individual’s or entity’s employment or retention by the Company.  Upon
termination of employment for any reason or upon request by the Company,
Executive shall deliver promptly to the Company all property and records of the
Company or any of its affiliates, including, without limitation, all
confidential records.  For purposes hereof, “confidential records”
means all correspondence, reports, memoranda, files, manuals, books, lists,
financial, operating or marketing records, magnetic tape, or electronic or other
media or equipment of any kind which may be in Executive’s possession or under
her control or accessible to her which contain any proprietary
information.  All property and records of the Company and any of its
affiliates (including, without limitation, all confidential records) shall be
and remain the sole property of the Company or such affiliate during the Term
and thereafter.

     

    (e)    Inventions and
Patents.

     

    (i)    The
Executive agrees that all processes, technologies and inventions (collectively,
"Inventions"), including new contributions, improvements, ideas and discoveries,
whether patentable or not, conceived, developed, invented or made by her during
the Term shall belong to the Company, provided that such Inventions grew out of
the Executive's work with the Company or any of its subsidiaries or affiliates,
are related in any manner to the business (commercial or experimental) of the
Company or any of its subsidiaries or affiliates or are conceived or made on the
Company's time or with the use of the Company's facilities or
materials.  The Executive shall further:  (a) promptly
disclose such Inventions to the Company; (b) assign to the Company, without
additional compensation, all patent and other rights to such

     

     

     

    
      
        
        

      

      
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    Inventions
for the United States and foreign countries; (c) sign all papers necessary to
carry out the foregoing; and (d) give testimony in support of the Executive's
inventorship.

     

    (ii)     If any
Invention is described in a patent application or is disclosed to third parties,
directly or indirectly, by the Executive within two years after the termination
of the Executive's employment by the Company, it is to be presumed that the
Invention was conceived or made during the Term.

     

    (iii)    The
Executive agrees that the Executive will not assert any rights to any Invention
as having been made or acquired by the Executive prior to the date of this
Agreement, except for Inventions, if any, disclosed to the Company in writing
prior to the date hereof.

     

    (iv)    The
Company shall be the sole owner of all the products and proceeds of the
Executive's services hereunder, including, but not limited to, all materials,
ideas, concepts, formats, suggestions, developments, arrangements, packages,
programs and other intellectual properties that the Executive may acquire,
obtain, develop or create in connection with and during the Term, free and clear
of any claims by the Executive (or anyone claiming under the Executive) of any
kind or character whatsoever (other than the Executive's right to receive
payments hereunder).  The Executive shall, at the request of the
Company, execute such assignments, certificates or other instruments as the
Company may from time to time deem necessary or desirable to evidence,
establish, maintain, perfect, protect, enforce or defend its right, title or
interest in or to any such properties.

     

    (f)    Enforcement.  Executive
acknowledges and agrees that, by virtue of her position, her services and access
to and use of confidential records and proprietary information, any violation by
her of any of the undertakings contained in this Section 6 would cause the
Company and/or its affiliates immediate, substantial and irreparable injury for
which it or they have no adequate remedy at law.  Accordingly,
Executive agrees and consents to the entry of an injunction or other equitable
relief by a court of competent jurisdiction restraining any violation or
threatened violation of any undertaking contained in this Section
6.  Executive waives posting by the Company or its affiliates of any
bond otherwise necessary to secure such injunction or other equitable
relief.  Rights and remedies provided for in this Section 6 are
cumulative and shall be in addition to rights and remedies otherwise available
to the parties hereunder or under any other agreement or applicable
law.

     

    (g)    Code of
Ethics.  Nothing in this Section 6 is intended to limit, modify
or reduce Executive’s obligations under the Company’s Code of
Ethics.  Executive’s obligations under this Section 6 are in addition
to, and not in lieu of, Executive’s obligations under the Code of
Ethics.  To the extent there is any inconsistency between this Section
6 and the Code of Ethics which would permit Executive to take any action or
engage in any activity pursuant to this Section 6 which he would be barred from
taking or engaging in under the Code of Ethics, the Code of Ethics shall
control.

     

     

     

    
      
        
        

      

      
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    7.    Assignment and
Transfer.

     

    (a)    Company.  This
Agreement shall inure to the benefit of and be enforceable by, and may be
assigned by the Company without Executive’s consent to, any purchaser of all or
substantially all of the Company’s business or assets, or to any successor to
the Company or any assignee thereof (whether direct or indirect, by purchase,
merger, consolidation or otherwise).

     

    (b)    Executive. The
parties hereto agree that Executive is obligated under this Agreement to render
personal services during her employment of a special, unique, unusual,
extraordinary and intellectual character, thereby giving this Agreement special
value.  Executive’s rights and obligations under this Agreement shall
not be transferable by Executive by assignment or otherwise, and any purported
assignment, transfer or delegation thereof shall be void; provided, however,
that if Executive shall die, all amounts then payable to Executive hereunder
shall be paid in accordance with the terms of this Agreement to Executive’s
estate.

     

    8.    Miscellaneous.

     

    (a)    Cooperation.  Following
termination of employment with the Company for any reason, Executive shall
cooperate with the Company, as requested by the Company, to effect a transition
of Executive’s responsibilities and to ensure that the Company is aware of all
matters being handled by Executive.

     

    (b)    Mitigation.  Executive
shall not be required to mitigate damages or the amount of any payment provided
to her under Section 5 of this Agreement by seeking other employment or
otherwise, nor shall the amount of any payments provided to Executive under
Section 5 be reduced by any compensation earned by Executive as the result of
employment by another employer after the termination of Executive’s employment
or otherwise.

     

    (c)    Protection of
Reputation.  During the Term and thereafter, Executive agrees
that he will take no action which is intended, or would reasonably be expected,
to harm the Company or any of its affiliates or its or their reputation or which
would reasonably be expected to lead to unwanted or unfavorable publicity to the
Company or its affiliates.  Nothing herein shall prevent Executive
from making any truthful statement in connection with any legal proceeding or
investigation by the Company or any governmental authority.

     

    (d)    Governing Law; Consent to
Jurisdiction.  This Agreement shall be governed by and
construed (both as to validity and performance) and enforced in accordance with
the internal laws of the State of New York applicable to agreements made and to
be performed wholly within such jurisdiction, without regard to the principles
of conflicts of law or where the parties are located at the time a dispute
arises.  In the event of any controversy or claim arising out of or
relating to this Agreement or the breach or alleged breach hereof, each of the
parties hereto irrevocably (a) consents to the jurisdiction of any state court
sitting in the County of New York, State of New York, or federal court sitting
in the County of New York, State of New York. (b) waives any objection which it
may have at any time to the laying of venue of any action or proceeding brought
in any such court and (c) waives any claim that such action or proceeding has
been brought in an inconvenient forum.

     

     

     

    
      
        
        

      

      
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                    (e)    Injunctive
Relief.  Notwithstanding anything to the contrary contained
herein, the Company and any affiliate of the Company (if applicable) shall have
the right to seek injunctive or other equitable relief from a court of competent
jurisdiction to enforce Section 6 of this Agreement without any obligation to
post a bond.

     

    (f)    Entire
Agreement.  This Agreement (including the plans referenced in
Section 3(c) of this Agreement) contain the entire agreement and understanding
between the parties hereto in respect of Executive’s employment from and after
the date hereof and supersede, cancel and annul any prior or contemporaneous
written or oral agreements, understandings, commitments and practices between
them respecting Executive’s employment from and after the date hereof, including
all prior employment agreements between the Company and Executive.

     

    (g)    Amendment.  This
Agreement may be amended only by a writing which makes express reference to this
Agreement as the subject of such amendment and which is signed by Executive and,
on behalf of the Company, by its duly authorized officer.

     

    (h)    Severability. If any
provision of this Agreement or the application of any such provision to any
party or circumstances shall be determined by any court of competent
jurisdiction or arbitration panel to be invalid or unenforceable to any extent,
the remainder of this Agreement, or the application of such provision to such
person or circumstances other than those to which it is so determined to be
invalid or unenforceable, shall not be affected thereby, and each provision
hereof shall be enforced to the fullest extent permitted by law.  If
any provision of this Agreement, or any part thereof, is held to be invalid or
unenforceable because of the scope or duration of or the area covered by such
provision, the parties hereto agree that the court or arbitration panel making
such determination shall reduce the scope, duration and/or area of such
provision (and shall substitute appropriate provisions for any such invalid or
unenforceable provisions) in order to make such provision enforceable to the
fullest extent permitted by law and/or shall delete specific words and phrases,
and such modified provision shall then be enforceable and shall be
enforced.  The parties hereto recognize that if, in any judicial or
arbitral proceeding, a court or arbitration panel shall refuse to enforce any of
the separate covenants contained in this Agreement, then that invalid or
unenforceable covenant contained in this Agreement shall be deemed eliminated
from these provisions to the extent necessary to permit the remaining separate
covenants to be enforced.  In the event that any court or arbitration
panel determines that the time period or the area, or both, are unreasonable and
that any of the covenants is to that extent invalid or unenforceable, the
parties hereto agree that such covenants will remain in full force and effect,
first, for the greatest time period, and second, in the greatest geographical
area that would not render them unenforceable.

     

    (i)    Construction.  The
headings and captions of this Agreement are provided for convenience only and
are intended to have no effect in construing or interpreting this
Agreement.  The language in all parts of this Agreement shall be in
all cases construed according to its fair meaning and not strictly for or
against the Company or Executive.  As used herein, the words “day” or
“days” shall mean a calendar day or days.

     

    (j)    Non-waiver.  Neither
any course of dealing nor any failure or neglect of either party hereto in any
instance to exercise any right, power or privilege hereunder

     

     

     

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

     

     

    or under
law shall constitute a waiver of any other right, power or privilege or of the
same right, power or privilege in any other instance.  All waivers by
either party hereto must be contained in a written instrument signed by the
party to be charged and, in the case of the Company, by its duly authorized
officer.

     

    (k)    Notices.  Any
notice required or permitted hereunder shall be in writing and shall be
sufficiently given if personally delivered or if sent by registered or certified
mail, postage prepaid, with return receipt requested, addressed:

     

    (i)       
in the
case of the Company, to :

     

    
      	
                                          If to
      the Company:

            
	
                                          SIGA
      Technologies, Inc.

            
	
                                          420
      Lexington Avenue, Suite 408

            
	
                                          New
      York, NY 10170

            
	
                                          Attention:

            	
              Chief
      Financial Officer

            
	
                                          Telephone
      Number:

            	
              (212)
      672-9100

            
	
                                          Facsimile
      Number:

            	
              (212)
      697-3130

            


    

    


    
      	
                                          With a
      copy to:

               

            
	
                                          James
      A. Grayer, Esq.

            
	
                                          Kramer
      Levin Naftalis & Frankel LLP

            
	
                                          1177
      Avenue of the Americas

            
	
                                          New
      York, NY 10036

            
	
                                          Telephone
      Number:

            	
              (212)
      715-9479

            
	
                                          Facsimile
      Number:

            	
              (212)
      715-8050

            


    

    


    (ii)    in the
case of Executive, to Executive’s last known address as reflected in the
Company’s records, or to such other address as Executive shall designate by
written notice to the Company.

     

    Any
notice given hereunder shall be deemed to have been given at the time of receipt
thereof by the person to whom such notice is given if personally delivered or at
the time of mailing if sent by registered or certified mail.

    


    (l)    Assistance in Proceedings,
Etc.  Executive shall, without additional compensation, during
and after the Term, upon reasonable notice, furnish such information and proper
assistance to the Company as may reasonably be required by the Company in
connection with any legal or quasi-legal proceeding, including any external or
internal investigation, involving the Company or any of its
affiliates.

     

    (m)    Survival.  Cessation
or termination of Executive’s employment with the Company shall not result in
termination of this Agreement.  The respective obligations of
Executive and the Company as provided in Sections 5, 6, 7 and 8 of this
Agreement shall survive cessation or termination of Executive’s employment
hereunder.

     

     

     

    
      
        
        

      

      
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    (n)    Section 409A of the
Code.

     

    (i)    It is the
parties’ intention that this Agreement not result in any tax being imposed under
Section 409A of the Code and in the case of any ambiguity the Agreement shall be
construed in such manner.

     

    (ii)    Notwithstanding
the foregoing, the Company makes no representations regarding the tax
implications of the compensation and benefits to be paid to Executive under this
Agreement, including, without limitation, under Section 409A of the
Code.  The parties agree that in the event a qualified tax advisor to
the Company or to Executive (neither party being required to retain such
advisor) reasonably advises that the terms hereof would result in Executive
being subject to tax under Section 409A of the Code, Executive and the Company
shall negotiate in good faith to amend this Agreement to the extent necessary to
prevent the assessment of any such tax, including by delaying the payment dates
of any amounts hereunder.

     

    [REMAINDER
OF PAGE INTENTIONALLY LEFT BLANK]

     

     

     

    
      
        
        

      

      
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    IN
WITNESS WHEREOF, the Company has caused this Agreement to be duly executed on
its behalf by an individual thereunto duly authorized and Executive has duly
executed this Agreement, all as of the date and year first written
above.

     

     

                                                    SIGA TECHNOLOGIES,
INC.

     

     

                                                    By: /s/ Thomas N.
Konatich            


                                                       Name: Thomas N.
Konatich

                                                       Title:   Chief
Financial Officer

     

     

                                                    Ayelet
Dugary                                   


                                                    Name:  
Ayelet Dugary

     

     

     

     

     

     

     

    15