Exhibit 10.2
THE SECURITIES
EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY
OTHER
SECURITIES LAWS, AND SUCH SECURITIES MAY NOT BE SOLD,
PLEDGED,
HYPOTHECATED OR OTHERWISE TRANSFERRED IN THE
ABSENCE OF SUCH
REGISTRATION UNDER SAID ACT AND LAWS OR AN
SIGA TECHNOLOGIES,
INC.
COMMON STOCK PURCHASE
WARRANT
1. Issuance; Certain
Definitions.
1.1 In consideration of
good and valuable consideration, the receipt of which is hereby
acknowledged by SIGA TECHNOLOGIES, INC., a Delaware corporation
(the "Company"), MacAndrews & Forbes LLC, a Delaware limited
liability corporation, or its registered assigns, is hereby granted
the right to purchase at any time until 5:00 P.M., New York City
time, on the Expiration Date, 196,078 fully paid and nonassessable
shares of Common Stock, at an initial exercise price per share (the
“Exercise Price”) of $3.519 per share, subject to
adjustment as set forth herein. The shares of Common
Stock issued upon exercise of this Warrant, as adjusted from time
to time pursuant to Section 6 hereof, are referred to as
“Consideration Warrant Shares.” This Warrant
is being issued pursuant to the terms and conditions of the
Commitment Letter.
1.2 As used in this
Warrant, the following terms have the respective meanings set forth
below:
"Actual
Minimum" has the meaning assigned to it in Section 11.2
hereof.
"Affiliate"
means, with respect to any specified Person, (i) any other Person
50% or more of whose Outstanding voting securities are directly or
indirectly owned, controlled or held with the power to vote by such
specified Person or (ii) any other Person directly or indirectly
controlling, controlled by or under direct or indirect common
control with such specified Person. For purposes of this
definition, the term "control" means the possession, directly or
indirectly, of the power to direct or cause the direction of the
management or policies of a Person by virtue of ownership of voting
securities, by contract or otherwise.
"Appraisal
Procedure" means the following procedure to determine the fair
market value, as to any security, for purposes of the definition of
"Fair Market Value" or the fair market value, as to any other
property (in either case, the "Valuation Amount"). The
Valuation Amount shall be determined in good faith jointly by the
Board of Directors and the Holder; provided, however, that if such
parties are not able to agree on the Valuation Amount within a
reasonable period of time (not to exceed 20 Business Days) the
Valuation Amount shall be determined by an investment banking firm
of national reputation, which firm shall be reasonably
acceptable to the Board of Directors and the Holder. If
the Board of Directors and the Holder are unable to agree upon an
acceptable investment banking firm within 10 days after the date
either party proposed that one be selected, the investment banking
firm will be selected by an arbitrator located in New York City,
New York, selected by the American Arbitration Association (or if
such organization ceases to exist, the arbitrator shall be chosen
by a court of competent jurisdiction). The arbitrator shall select
the investment banking firm (within 10 days of his appointment)
from a list, jointly prepared by the Board of Directors and the
Holder, of not more than six investment banking firms of national
reputation in the United States, of which no more than three may be
named by the Board of Directors and no more than three may be named
by the Holder. The arbitrator may consider, within the
10-day period allotted, arguments from the parties regarding which
investment banking firm to choose, but the selection by the
arbitrator shall be made in its sole discretion from the list of
six. The Board of Directors and the Holder shall submit
their respective valuations and other relevant data to the
investment banking firm, and the investment
banking firm
shall, within 30 days of its appointment, make its own
determination of the Valuation Amount. The determination
of the final Valuation Amount by such investment banking firm shall
be final and binding upon the parties. The Company shall
pay all of the fees and expenses of the investment banking firm and
arbitrator (if any) used to determine the Valuation
Amount. If required by any such investment banking firm
or arbitrator, the Company shall execute a retainer and engagement
letter containing reasonable terms and conditions, including,
without limitation, customary provisions concerning the rights of
indemnification and contribution by the Company in favor of such
investment banking firm or arbitrator and its officers, directors,
partners, employees, agents and Affiliates.
"Board of
Directors" means the board of directors of the Company.
"Business Day"
means any day that is not a Saturday or Sunday or a day on which
banks are required or permitted to be closed in the State of New
York.
"Commitment
Letter" means the Commitment Letter by and between the Company and
MacAndrews & Forbes LLC, dated June 19, 2008, as amended by
that certain Extension Letter, dated as of April 29,
2009.
"Common Stock"
means the Common Stock of the Company, par value $0.0001 per share,
as constituted on the Original Issue Date, and any capital stock
into which such Common Stock may thereafter be changed, and shall
also include (i) capital stock of the Company of any other class
(regardless of how denominated) issued to the holders of shares of
any Common Stock upon any reclassification thereof which is not
preferred as to dividends or liquidation over any other class of
stock of the Company and which is not subject to redemption and
(ii) shares of common stock of any successor or acquiring
corporation received by or distributed to the holders of Common
Stock of the Company in the circumstances contemplated by Section
6.5 hereof.
"Company" has
the meaning assigned to it in Section 1.1 hereof.
"Designated
Office" has the meaning assigned to it in Section 11.3
hereof.
"Excluded
Stock" has the meaning assigned to it in Section 6.10
hereof.
"Exercise Date"
has the meaning assigned to it Section 2.1(a) hereof.
"Exercise
Price" means, in respect of a share of Common Stock at any date
herein specified, the initial Exercise Price set forth in Section
1.1 hereof, as adjusted from time to time pursuant to Section 6
hereof.
"Expiration
Date" means April 29, 2013.
"Fair Market
Value" means, as to any security, the Twenty Day Average of the
average closing prices of such security's sales on all domestic
securities exchanges on which such security may at the time be
listed, or, if there have been no sales on any such exchange on any
day, the average of the highest bid and lowest asked prices on all
such exchanges at the end of such day, or, if on any day such
security is not so listed, the average of the highest bid and
lowest asked prices on such day in the domestic over-the-counter
market as reported by the National Quotation Bureau, Incorporated,
or any similar or successor organization (and in each such case
excluding any trades that are not bona fide, arm's length
transactions). If at any time such security is not
listed on any domestic securities exchange or quoted on the
domestic over-the-counter market, the "Fair Market Value" of such
security shall be the fair market value thereof as determined in
accordance with the Appraisal Procedure, using any appropriate
valuation method, assuming an arms-length sale to an independent
party.
"Form of
Assignment" has the meaning assigned to it in Section 4.1
hereof.
"Governmental
Entity" means any national, federal, state, municipal, local,
territorial, foreign or other government or any department,
commission, board, bureau, agency, regulatory authority or
instrumentality thereof, or any court, judicial, administrative or
arbitral body or public or private tribunal.
"Holder" means
(a) with respect to this Warrant, the Person in whose name the
Warrant set forth herein is registered on the books of the Company
maintained for such purpose and (b) with respect to any other
Warrant or Warrant Shares, the Person in whose name such Warrant or
Warrant Shares is registered on the books of the Company maintained
for such purpose.
"Issuable
Minimum" has the meaning assigned to it in Section 11.2
hereof.
"Lien" means
any mortgage or deed of trust, pledge, hypothecation, assignment,
deposit arrangement, lien, charge, claim, security interest,
easement or encumbrance, or preference, priority or other security
agreement or preferential arrangement of any kind or nature
whatsoever (including, without limitation, any lease or title
retention agreement, any financing lease having substantially the
same economic effect as any of the foregoing, and the filing of, or
agreement to give, any financing statement perfecting a security
interest under the Uniform Commercial Code or comparable law of any
jurisdiction).
"Notice of
Exercise" has the meaning assigned to it in Section 2.1(a)
hereof.
"Original Issue
Date" means April 30, 2009.
"Original
Warrants" means the Warrants originally issued by the Company on
April 30, 2009, pursuant to the Commitment Letter.
"Outstanding" means, (a) when used with
reference to Common Stock, at any date as of which the number of
shares thereof is to be determined, all issued shares of Common
Stock, except shares then owned or held by or for the account of
the Company or any Subsidiary, and shall include all shares
issuable in respect of Outstanding scrip or any certificates
representing fractional interests in shares of Common Stock and (b)
when used with reference to Warrants, at any date as of which the
number thereof is to be determined, all issued Warrants.
"Permitted
Transferee" means (i) any Affiliate of the Holder, including,
without limitation, directors, executives and officers of the
Holder, (ii) any member of the family of any Affiliate of the
Holder, including any such Person's spouse and descendants and any
trust, partnership, corporation, limited liability company or other
entity for the benefit of such spouse and/or descendants to whom or
which any of the Securities have been transferred by any such
Person for estate or tax planning purposes, (iii) any charity or
foundation to which the Securities have been transferred by the
Holder or any Person or entity described in clause (i) or (ii)
above for estate or tax planning or charitable purposes, or (iv)
the beneficiary of any bona fide pledge by the Holder of any of the
Securities.
"Person" means
any individual, sole proprietorship, partnership, limited liability
company, joint venture, trust, incorporated organization,
association, corporation, institution, Governmental Entity or any
other entity.
"Reserved Spin
Off Securities" has the meaning assigned to it in Section 6.2
hereof.
"SEC" means the
U.S. Securities and Exchange Commission or any other federal agency
then administering the Securities Act and other federal securities
laws.
"Securities
Act" means the Securities Act of 1933, as amended, and the rules
and regulations of the SEC thereunder, all as the same shall be in
effect at the time.
"Spin Off
Securities" has the meaning assigned to it in Section 6.2
hereof.
"Subsidiary"
means, with respect to any Person, any corporation, association
trust, limited liability company, partnership, joint venture or
other business association or entity (i) at least 50% of the
Outstanding voting securities of which are at the time owned or
controlled directly or indirectly by such Person or (ii) with
respect to which the Company possesses, directly or indirectly, the
power to direct or cause the direction of the affairs or management
of such Person.
“Subscription Agreement” means
the Subscription Agreement by and between the Company and
MacAndrews & Forbes LLC, dated April 30, 2009.
"Transfer"
means any disposition of any Warrant or Warrant Shares or of any
interest therein, which would constitute a "sale" thereof within
the meaning of the Securities Act.
"Twenty Day
Average" means, with respect to any prices and in connection with
the calculation of Fair Market Value, the average of such prices
over the 20 Business Days ending on the Business Day immediately
prior to the day as of which Fair Market Value is being
determined.
"Warrant Price"
means an amount equal to (i) the number of Consideration Warrant
Shares being purchased upon exercise of this Warrant pursuant to
Sections 1 and 2 hereof, multiplied by (ii) the Exercise
Price.
"Consideration
Warrant Shares" has the meaning assigned to it in Section 1.1
hereof.
"Warrants"
means the Original Warrants and all Warrants issued upon transfer,
division or combination of, or in substitution for, the Original
Warrants, or any other such Warrant subsequently issued to the
Holder. All Warrants shall at all times be identical as
to terms and conditions, except as to the Consideration Warrant
Shares for which they may be exercised and their date of
issuance.
2. Exercise of
Warrants.
2.1 Manner of
Exercise.
(a) This
Warrant is exercisable in whole or in part at any time and from
time to time on any Business Day from and after the Original Issue
Date and at any time until 5:00 P.M., New York time, on the
Expiration Date. Such exercise shall be effectuated by
submitting to the Company at its Designated Office (i) a completed
and duly executed written notice of the Holder's election to
exercise this Warrant (a "Notice of Exercise") (substantially in
the form attached to this Warrant as Annex A) indicating the
Consideration Warrant Shares then being purchased pursuant to such
exercise, together with this Warrant and (ii) payment to the
Company of the Warrant Price. The date on which such delivery and
payment shall have taken place being sometimes referred to as the
"Exercise Date."
(b) Upon
receipt by the Company of such Notice of Exercise, surrender of
this Warrant and payment of the Warrant Price (in accordance with
Section 2.1(c) hereof), the Holder shall be entitled to receive as
promptly as practicable, and in any event within five Business Days
thereafter, a certificate or certificates for Consideration Warrant
Shares so purchased in such denomination or denominations as the
exercising Holder shall reasonably request in the Notice of
Exercise, registered in the name of the Holder or, subject to
Section 4 hereof, such other name as shall be designated in the
Notice of Exercise, together with cash in lieu of any fraction of a
share, as provided in Section 2.3 hereof. If this
Warrant shall have been exercised in part, the Company shall, at
the time of delivery of the certificate or certificates
representing the Consideration Warrant Shares being issued, deliver
to the Holder a new Warrant evidencing the rights of the Holder to
purchase the remaining Consideration Warrant Shares underlying this
Warrant. Such new Warrant shall in all other respects be
identical to this Warrant. This Warrant shall be deemed
to have been exercised and such certificate or certificates of
Consideration Warrant Shares shall be
deemed to have
been issued, and the Holder or any other Person so designated to be
named therein shall be deemed to have become a holder of record of
such Consideration Warrant Shares for all purposes, as of the
Exercise Date.
(c) Payment of
the Warrant Price shall be made at the option of the Holder by one
or more of the following methods: (i) by delivery of a certified or
official bank check or by wire transfer of immediately available
funds in the amount of such Warrant Price payable to the order of
the Company, (ii) by instructing the Company to withhold a number
of Consideration Warrant Shares then issuable upon exercise of this
Warrant with an aggregate Fair Market Value equal to such Warrant
Price, (iii) by surrendering to the Company shares of Common Stock
previously acquired by the Holder with an aggregate Fair Market
Value equal to such Warrant Price, or (iv) any combination of the
foregoing. In the event of any withholding of
Consideration Warrant Shares or surrender of Common Stock pursuant
to clause (ii), (iii) or (iv) above where the number of shares
whose Fair Market Value is equal to the Warrant Price is not a
whole number, the number of shares withheld by or surrendered
to the Company shall be rounded up to the nearest whole share and
the Company shall make a cash payment to the Holder based on the
incremental fraction of a share being so withheld by or surrendered
to the Company in an amount determined in accordance with Section
2.3 hereof.
2.2 Payment of
Taxes. All Consideration Warrant Shares issuable upon
the exercise of this Warrant pursuant to the terms hereof shall be
validly issued, fully paid and nonassessable, issued without
violation of any preemptive or similar rights of any stockholder of
the Company and free and clear of all Liens. The Company
shall pay all expenses in connection with, and all taxes and other
governmental charges that may be imposed with respect to, the issue
or delivery thereof. The Company shall not, however, be
required to pay any tax or governmental charge which may be
issuable upon exercise of this Warrant payable in respect of any
Transfer involved in the issue and delivery of Consideration
Warrant Shares in a name other than that of the holder of the
Warrants to be exercised, and no such issue or delivery shall be
made unless and until the Person requesting such issue has
paid to the Company the amount of any such tax, or has established
to the satisfaction of the Company that such tax has been
paid.
2.3 Fractional
Shares. The Company shall not be required to issue a
fractional share of Common Stock upon exercise of any
Warrant. As to any fraction of a share that the Holder
of one or more Warrants, the rights under which are exercised in
the same transaction, would otherwise be entitled to purchase upon
such exercise, the Company shall pay to such Holder an amount in
cash equal to such fraction multiplied by the Fair Market Value of
one share of Common Stock on the Exercise Date.
3.
Reservation and Authorization of Common
Stock. The Company shall at all times during the term of
this Warrant reserve for issuance upon exercise of the then
outstanding balance of this Warrant such number of shares of its
Common Stock as shall be required for issuance of the Consideration
Warrant Shares. Before taking any action that would
result in an adjustment in the number of Consideration Warrant
Shares for which this Warrant is exercisable or in the Exercise
Price, the Company shall obtain all such authorizations or
exemptions thereof, or consents thereto, as may be necessary from
any public regulatory body or bodies having jurisdiction over such
action. If any Consideration Warrant Shares required to
be reserved for issuance upon exercise of Warrants require
registration or qualification with any Governmental Entity (other
than under the Securities Act or any state securities law) before
such shares may be so issued, the Company will in good faith and as
expeditiously as possible and at its expense endeavor to cause such
shares to be duly registered. Before taking any action
that would cause an adjustment reducing the Exercise Price below
the then par value (if any) of the shares of Common Stock
deliverable upon exercise of the Warrant or that would cause the
number of Consideration Warrant Shares issuable upon exercise of
the Warrant to exceed (when taken together with all other
Outstanding shares of Common Stock) the number of Consideration
Warrant Shares that the Company is authorized to issue, the Company
will take any corporate action that, in the opinion of its counsel,
is necessary in order that the Company may validly and legally
issue the full number of fully paid and non-assessable shares of
Common Stock issuable upon exercise of the Warrant at such adjusted
exercise price.
4. Transfer,
Assignment, Division, Combination, Mutilation or Loss of
Warrant.
4.1 Transfer or
Assignment of Warrant. Subject to the limitations set
forth in Section 7 hereof, upon (a) surrender of this Warrant to
the Company at its Designated Office accompanied by a Form of
Assignment annexed hereto as Annex B (each, a “Form of
Assignment”) duly executed and funds sufficient to pay any
applicable transfer tax, and (b) delivery of an opinion of counsel
to the Holder reasonably satisfactory to the Company to the effect
that, in the opinion of such counsel, the transfer is exempt from
the registration requirements of the Securities Act (provided that
no such opinion shall be required in the event of a Transfer to a
Permitted Transferee), the Company shall, without charge, execute
and deliver a new Warrant registered in the name of the assignee
named in the Form of Assignment at the address, and evidencing the
right to purchase the shares of Common Stock, specified in the Form
of Assignment, and the Warrant represented by this Warrant shall
promptly be cancelled.
4.2 Mutilation or Loss of
Warrant. Upon receipt by the Company of evidence
satisfactory to it of the loss, theft, destruction or mutilation of
this Warrant, and (in the case of loss, theft or destruction)
receipt of reasonably satisfactory indemnification, and (in the
case of mutilation) upon surrender and cancellation of this
Warrant, the Company will execute and deliver a new Warrant of like
tenor and date and any such lost, stolen, destroyed or mutilated
Warrant shall thereupon become void.
4.
