Document:

Amended & Restated Employment Agreement

    
      

    

                                                                                                    Exhibit
      10.2

     

     

    AMENDED
      AND RESTATED 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 Dr.
      Dennis E. Hruby (“Executive”).

     

    WHEREAS,
      the Company desires to employ Executive as its Chief
      Scientific Officer, 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 three-year period commencing as of the date hereof and
      ending on January 22, 2010 (the
      “Term”), with each year of the Term beginning on January 23 (each
      year of the Term, 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 Chief Scientific Officer of the Company and shall report to the Board
      of
      Directors and Chief Executive Officer of the Company.

     

    (b) Performance
      of Duties.
      Throughout his 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. Except as
      permitted pursuant to Section 2(c) below, Executive shall devote his full
      business time and best efforts to the business and affairs of the Company.
      In
      his capacity as the Chief Scientific Officer of the Company, Executive shall
      have such duties and responsibilities as he may be assigned by the Board of
      Directors and Chief Executive Officer of the Company not inconsistent with
      his
      position as Chief Scientific Officer of
      the
      Company.

     

    (c) Appointment
      at Oregon State University.
      Executive shall be permitted to continue with his part-time appointment as
      a
      faculty member of Oregon State University, provided that such duties do not
      interfere with his duties as Chief Scientific Officer of the Company and subject
      in all cases to ongoing approval of the Board of Directors 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 $250,000, 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 may, in its sole discretion, pay to Executive an annual cash bonus
      of up
      to fifty percent (50%) of his Base Salary, but in any event will pay an annual
      cash bonus of no less than twenty five percent (25%) of his Base Salary. 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 his 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 his 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
      him 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 

     

     

    
      
        
        

      

      
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    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.

     

    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 his 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 his 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 his 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

     

     

    
      
        
        

      

      
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    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 Chief Scientific Officer or
      offices of equivalent stature, or his functions and/or duties as Chief
      Scientific Officer are
      materially diminished; or (iii) Executive’s job site is relocated to a location
      which is more than fifty (50) miles from Corvallis Oregon, 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, his
      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 his 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”):

     

     

    
      
        
        

      

      
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    (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 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 his 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 two years 
      (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.

     

     

    
      
        
        

      

      
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    (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 two (2) years from the date of
      termination.

     

    (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 two years (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 two (2) years 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 his 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,

     

     

    
      
        
        

      

      
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    assigns,
      agents and representatives arising out of or related to Executive’s employment
      by the Company and the termination of such employment.

     

    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 his personal investments and otherwise
      attend to personal affairs, including charitable, social and political
      activities, in a manner that does not unreasonably interfere with his
      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 him 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) his
      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 his 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 his, 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

     

     

    
      
        
        

      

      
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    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 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 his 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 him 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 his 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 his 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

     

    
      
        
        

      

      
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    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 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 his
      control or accessible to him 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 him 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

     

     

    
      
        
        

      

      
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    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 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 his position, his services
      and access to and use of confidential records and proprietary information,
      any
      violation by him 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 his 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 him 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. 

     

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

     

     

    (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.

     

     

     

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

     

     

    (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:
      President

     

     

                                    /s/
Dennis
      E.
      Hruby                             

                                    Name:   
      Dr. Dennis E. Hruby

     

     

     

     

     

     

     

     

     

    15EXHIBIT 10.1(a1)

RATE APPLICABLE TO 

     DIRECTORS
AND EXECUTIVE OFFICERS UNDER THE

DIRECTORS AND EXECUTIVES DEFERRED COMPENSATION
PLAN

Effective for the 2007 plan year, the Board of Directors and its Compensation Committee on January 16, 2007 approved an applicable interest rate for the Directors and Executives Deferred Compensation Plan of 13%. That rate
applies prospectively to certain participants, including all participants who presently are directors or executive officers of the registrant. Rates generally are subject to annual approval by the Committee, but generally remain in effect until
changed. The new interest rate, within the context of the entire Plan, has been established at a level intended to provide both retention and long-term non-compete incentives.

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