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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
__________________________
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of report (Date of earliest event reported): April 27, 2005
__________
SIGA Technologies, Inc.
-----------------------
(Exact Name of Registrant as Specified in Charter)
Delaware 0-23047 13-3864870
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(State or other Jurisdiction of (Commission File (I.R.S. Employer
Incorporation or Organization) Number) Identification Number)
420 Lexington Avenue, Suite 408, New York, New York 10170
--------------------------------------------------- -----
(Address of Principal Executive Offices) (Zip Code)
(212) 672-9100
--------------
(Registrant's telephone number, including area code)
ITEM 1.01. Entry Into A Material Definitive Agreement
------------------------------------------
On April 27, 2005, SIGA Technologies, Inc., a Delaware corporation
("SIGA"), entered into a Service Agreement, dated as of April 27, 2005, between
SIGA and TransTech Pharma, Inc., a Delaware corporation ("TransTech"), a copy of
which is filed herewith as Exhibit 10.1. The Service Agreement provides that
TransTech shall provide assistance with the pre-IND toxicology and safety
pharmacology and chemical manufacturing and control studies required for SIGA's
IND application for a proprietary compound. TransTech is a significant
stockholder of SIGA, and the President and Chief Executive Officer of TransTech
is a member of SIGA's board of directors. In addition, SIGA and TransTech are
parties to a drug discovery collaboration agreement.
On April 29, 2005, SIGA entered into a Master Security Agreement, dated as
of April 29, 2005, between General Electric Capital Corporation ("GE") and SIGA,
a copy of which is filed herewith as Exhibit 10.2. Under the Master Security
Agreement, SIGA will grant to GE a security interest in and against certain
property to secure equipment financed through GE. As of the date hereof, no
equipment has been so financed.
ITEM 9.01. Financial Statements and Exhibits
---------------------------------
(c) Exhibits
Exhibit No. Description
----------- -----------
10.1 Service Agreement, dated as of April 27, 2005, between SIGA
Technologies, Inc. and TransTech Pharma, Inc.
10.2 Master Security Agreement, dated as of April 29, 2005,
between General Electric Capital Corporation and SIGA
Technologies, Inc.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
SIGA TECHNOLOGIES, INC.
By: /s/ Thomas N. Konatich
-----------------------------
Thomas N. Konatich
Chief Financial Officer
Date: May 3, 2005
EXHIBIT INDEX
-------------
Exhibit No. Description
----------- -----------
10.1 Service Agreement, dated as of April 27, 2005, between SIGA
Technologies, Inc. and TransTech Pharma, Inc.
10.2 Master Security Agreement, dated as of April 29, 2005,
between General Electric Capital Corporation and SIGA
Technologies, Inc.
Exhibit 10.1
SERVICE AGREEMENT
This SERVICE AGREEMENT ("Agreement") is made effective on April 27, 2005,
by and between SIGA Technologies, Inc., with an address at 4575 SW Research Way,
Suite 230, Corvallis, OR 97333 ("SIGA") and TransTech Pharma, Inc., with a place
of business at 4170 Mendenhall Oaks Parkway, Suite 110, High Point, NC 27265
("TransTech").
WHEREAS, SIGA seeks assistance with pre-IND toxicology and safety
pharmacology and chemical manufacturing and control studies required for SIGA's
IND application for its proprietary SIGA-246 compound (hereafter, "Studies");
WHEREAS, TransTech is able to design and implement IND-enabling Studies to
support SIGA's submission of an IND application for SIGA's SIGA-246 compound and
provide assistance to obtain services of other commercial research organizations
for completion of the required Studies for SIGA's IND submission; and
WHEREAS, SIGA desires and TransTech is willing to provide SIGA with
certain services related to completion of the Studies in accordance with the
terms and conditions specified herein.
NOW THEREFORE, in consideration of the foregoing recitals and the mutual
promises and conditions set forth herein, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
SIGA and TransTech, intending to be legally bound, agree as follows:
1. SERVICES
--------
1.1 Subject to the terms hereof, TransTech shall design, implement and
complete certain Studies and other activities specified in the attached
Exhibit A, which may be updated periodically upon the written agreement of
both parties. TransTech shall use commercially reasonable efforts to
complete the Studies in the time frames set forth on Exhibit A. There
shall be a separate written agreement between SIGA and any third parties
used to complete the Studies listed in Exhibit A.
1.2 TransTech shall seek competitive bids from other commercial research
organizations which can perform those Studies listed in the attached
Exhibit B. Upon receipt, TransTech shall submit such competitive bids to
the attention of Dr. Dennis Hruby of SIGA for his consideration. There
shall be a separate written agreement between SIGA and each third party
used for performance of the Studies listed in Exhibit B.
1.3 TransTech shall provide SIGA with monthly reports summarizing all
activities and progress regarding the Studies and those activities
completed (hereinafter "Monthly Reports"). TransTech shall also conduct
weekly teleconferences with SIGA representatives regarding the status of
the Studies.
2. RIGHTS
------
2.1 All proprietary and Intellectual Property rights, including patents,
patent applications, trademarks, copyrights, trade secrets, and know-how
in or relating to the SIGA-246 compound are owned exclusively by SIGA.
2.2 Any improvements to or derivations of the SIGA-246 compound made by
TransTech, whether patented or not, shall be owned by and promptly
assigned to SIGA.
2.3 TransTech shall not transfer the SIGA-246 compound, or any part of it to
any third party without the prior written consent of SIGA. TransTech shall
use the SIGA-246 compound only for the Studies designated to be completed
by TransTech in Exhibit A.
2.4 TransTech will comply with all federal, state and local laws, regulations
and ordinances in the performance of the Studies and other services
specified herein.
2.5 Each party acknowledges that this Agreement grants no right to the other
party under any patents owned or licensed by either party, except as
described herein and to the extent that such rights are required to carry
out the Studies. Each party also acknowledges that this Agreement likewise
grants no right to use any information, know-how, or data that is
proprietary to the other party, except for the purposes of the stated
Studies.
2.6 The provisions of this section shall survive the expiry or termination of
this Agreement.
3. PRICE AND PAYMENT
-----------------
3.1 In consideration for the services listed in Section 1, SIGA shall pay
TransTech on an hourly or unit cost basis, as set forth in Exhibit C.
TransTech agrees that it shall not exceed a total aggregate cost of
$168,000 for the Studies (the "Aggregate Limit"), without the prior
approval of SIGA. In the event that during the course of performing the
Studies TransTech anticipates the Aggregate Limit will be exceeded,
TransTech will inform SIGA, and will cease performance of TransTech's
services when the Aggregate Limit is reached unless SIGA approves any
additional costs. SIGA shall pay TransTech within thirty (30) days of
receipt of an invoice.
4. WARRANTIES AND REPRESENTATIONS
------------------------------
4.1 TransTech warrants that those Studies and responsibilities designated to
be completed by TransTech in Exhibit A will be performed diligently and in
a professional manner consistent with TransTech's provision of similar
services to itself, or its subsidiaries or affiliates. In the event that
there is a breach of this warranty provision, TransTech shall, upon
request by SIGA, perform again the Studies in question at no cost to SIGA.
TRANSTECH EXPRESSLY DISCLAIMS ALL OTHER WARRANTIES, EXPRESS OR IMPLIED,
INCLUDING ANY IMPLIED WARRANTY OF COMMERCIAL VIABILITY OR FITNESS FOR A
PARTICULAR PURPOSE, OF ANY TRANSTECH SERVICE. THIS DISCLAIMER EXTENDS TO
ALL SERVICES, DATA AND REPORTS PRODUCED BY TRANSTECH. TRANSTECH MAKES NO
WARRANTY AS TO THE QUALITY, SUITABILITY, OR ADEQUACY OF THE SERVICES OR
PRODUCTS FOR ANY PURPOSE OR USE.
IN NO EVENT SHALL TRANSTECH HAVE ANY LIABILITY UNDER THIS AGREEMENT OR
OTHERWISE ARISING OUT OF OR RESULTING FROM THE PERFORMANCE OR FAILURE TO
PERFORM, SERVICES FOR LOSS OF ANTICIPATED PROFITS, OR FOR ANY INCIDENTAL,
INDIRECT, SPECIAL OR CONSEQUENTIAL DAMAGES, WHETHER OR NOT TRANSTECH WAS
INFORMED OF THE POSSIBILITY OF THE EXISTENCE OF SUCH DAMAGES. IN NO EVENT
SHALL TRANSTECH HAVE ANY LIABILITY HEREUNDER IN AN AGGREGATE AMOUNT
EXCEEDING THE TOTAL AMOUNT PAID TO TRANSTECH UNDER THIS AGREEMENT.
4.2 TransTech shall use its best efforts to obtain competitive bids for those
Studies listed in Exhibit B.
4.3 SIGA has full responsibility for all business, financial and other
decisions concerning its operations, including whether, how and to the
extent SIGA utilizes the deliverables, results and reports generated from
the Studies done for SIGA's IND-submission.
4.4 SIGA shall defend, indemnify and hold harmless TransTech and its officers,
directors, employees, consultants and agents ("Indemnitees") from and
against all damages, liabilities, losses, fines, penalties, settlements,
costs and expenses of any kind and nature (including, without limitation,
reasonable attorneys fees and court costs), incurred in connection with
any claim, demand, proceeding, action, hearing or investigation (a
"Claim") relating to or arising from the Agreement or the services
performed by TransTech under the Agreement, except to the extent that: (i)
such liability arises from the gross negligence or intentional misconduct
of TransTech; or (ii) such Claim is made by an employee of TransTech
arising from work performed by such employee in connection with this
Agreement.
5. CONFIDENTIALITY
---------------
5.1 All information relating to SIGA's SIGA-246 compound, any analytical
methods, trade secrets and know-how disclosed to TransTech by SIGA for use
with the SIGA-246 compound, the results of the Studies, and all related
reports are the confidential and proprietary information of SIGA (the
"SIGA Information").
5.2 TransTech shall not disclose the SIGA Information to any third party or
use the SIGA Information for TransTech's direct or indirect benefit or the
direct or indirect benefit of any third party, except as expressly
permitted hereunder.
5.3 TransTech shall disclose the SIGA Information only to the minimum number
of its employees requiring such access in order to perform the Studies,
inform such employees of the proprietary nature of the SIGA Information,
and take reasonable precautions, at least as stringent as those observed
by TransTech to protect its own proprietary information, to ensure that
such employees observe the confidentiality obligations of TransTech
hereunder.
5.4 The SIGA Information is and shall remain the property of SIGA and may be
covered by claims of U.S. and international patents or patent applications
of SIGA.
5.5 TransTech will either destroy or return all SIGA Information, as
instructed by SIGA, upon completion of all Studies, or the written request
of SIGA.
5.6 SIGA Information shall not include:
(a) information which at the time of disclosure is in the public domain;
provided that, specific information disclosed as part of the SIGA
Information shall not be deemed to be in the public domain merely
because it is embraced by more general information in the public
domain; or
(b) information which, after disclosure, becomes part of the public
domain by publication or otherwise, except by breach of this
Agreement by TransTech or by any of TransTech's employees; or
(c) information which TransTech shall receive from a third party who has
the right to disclose it to TransTech; provided that such
information was not obtained by such third party, directly or
indirectly, from SIGA under a confidentiality agreement with SIGA;
or
(d) information that is independently developed by TransTech without
reference to the SIGA Information.
5.7 The provisions of this section shall survive the expiry or termination of
this Agreement.
6. TERM AND TERMINATION
--------------------
6.1 This Agreement shall remain in effect until SIGA's IND application for
SIGA-246 has been accepted or finally rejected by the Food and Drug
Administration, or until terminated pursuant to Section 6.2 herein.
6.2 Either party may terminate this Agreement by providing the other party
with thirty (30) days' written notice. Upon the effective date of such
termination, all activities associated with the services specified in
Section 1herein shall cease. SIGA shall promptly pay TransTech for all
work performed up to the effective date of such termination.
7. MISCELLANEOUS
-------------
7.1 This Agreement shall not be assigned or otherwise transferred by either
party without the prior written consent of the other party.
7.2 This Agreement shall be governed by the laws of the State of New York
without regard to the principles of conflict-of-law doctrines of New York
or any other jurisdiction. Any action or proceeding brought by either
party against the other shall be brought in a state or federal court
located in New York.
7.3 This Agreement contains the entire agreement between the parties and
supersedes all prior agreements, written or oral, with respect to the
subject matter hereof.
7.4 TransTech's completion of the Studies or successful search for third
parties to complete the Studies required for SIGA's SIGA-246 IND
submission does not obligate SIGA to use TransTech for any subsequent
services, whether related to SIGA-246 or any other SIGA compound.
7.5 This Agreement shall not be amended, modified, varied or supplemented
except in writing signed by duly authorized representatives of both
parties.
7.6 No failure or delay on the part of either party hereto to exercise any
right or remedy under this Agreement shall be construed or operated as a
waiver thereof nor shall any single or partial exercise of any right or
remedy under this Agreement preclude the exercise of any other right or
remedy or preclude the further exercise of such right or remedy as the
case may be. The rights and remedies provided in this Agreement are
cumulative and are not exclusive of any rights or remedies provided by
law.
7.7 The parties do not intend that any agency or partnership relationship be
created between them by this Agreement. The parties shall be and shall act
at all times as independent contractors, and at no time shall either party
make any commitments or incur any charges or expenses for or in the name
of the other party.
7.8 Neither party shall be liable for the failure to perform its obligations
under this Agreement if such failure is occasioned by a contingency beyond
such party's reasonable control, including but not limited to strikes or
labor disturbances, lockouts, riots, wars, terrorist activities, fires,
floods, earthquakes, storms or inability to obtain materials or services.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
SIGA TECHNOLOGIES, INC. TRANSTECH PHARMA, INC.
By: /s/ Bernard L. Kasten, M.D. By: /s/ Stephen J. Ireland
----------------------------- ------------------------------
Bernard L. Kasten, M.D. Stephen J. Ireland
Chief Executive Officer S.V.P. Business Development
Exhibit 10.2
*LOAN7000*
MASTER SECURITY AGREEMENT
dated as of April 29, 2005 ("Agreement")
THIS AGREEMENT is between General Electric Capital Corporation (together
with its successors and assigns, if any, "Secured Party") and SIGA Technologies,
Inc. ("Debtor"). Secured Party has an office at 83 Wooster Heights Road,
Danbury, CT 06810. Debtor is a corporation organized and existing under the laws
of the state of Delaware ("the State"). Debtor's mailing address and chief place
of business is 420 Lexington Avenue, Suite 601, New York, NY 10170.
1. CREATION OF SECURITY INTEREST.
Debtor grants to Secured Party, its successors and assigns, a security
interest in and against all property listed on any collateral schedule now or in
the future annexed to or made a part of this Agreement ("Collateral Schedule"),
and in and against all additions, attachments, accessories and accessions to
such property, all substitutions, replacements or exchanges therefor, and all
insurance and/or other proceeds thereof (all such property is individually and
collectively called the "Collateral"). This security interest is given to secure
the payment and performance of all debts, obligations and liabilities of any
kind whatsoever of Debtor to Secured Party, now existing or arising in the
future, including but not limited to the payment and performance of certain
Promissory Notes from time to time identified on any Collateral Schedule
(collectively "Notes" and each a "Note"), and any renewals, extensions and
modifications of such debts, obligations and liabilities (such Notes, debts,
obligations and liabilities are called the "Indebtedness").
2. REPRESENTATIONS, WARRANTIES AND COVENANTS OF DEBTOR.
Debtor represents, warrants and covenants as of the date of this Agreement
and as of the date of each Collateral Schedule that:
(a) Debtor's exact legal name is as set forth in the preamble of this
Agreement and Debtor is, and will remain, duly organized, existing and in good
standing under the laws of the State set forth in the preamble of this
Agreement, has its chief executive offices at the location specified in the
preamble, and is, and will remain, duly qualified and licensed in every
jurisdiction wherever necessary to carry on its business and operations;
(b) Debtor has adequate power and capacity to enter into, and to perform
its obligations under this Agreement, each Note and any other documents
evidencing, or given in connection with, any of the Indebtedness (all of the
foregoing are called the "Debt Documents");
(c) This Agreement and the other Debt Documents have been duly authorized,
executed and delivered by Debtor and constitute legal, valid and binding
agreements enforceable in accordance with their terms, except to the extent that
the enforcement of remedies may be limited under applicable bankruptcy and
insolvency laws;
(d) No approval, consent or withholding of objections is required from any
governmental authority or instrumentality with respect to the entry into, or
performance by Debtor of any of the Debt Documents, except any already obtained;
(e) The entry into, and performance by, Debtor of the Debt Documents will
not (i) violate any of the organizational documents of Debtor or any judgment,
order, law or regulation applicable to Debtor, or (ii) result in any breach of
or constitute a default under any contract to which Debtor is a party, or result
in the creation of any lien, claim or encumbrance on any of Debtor's property
(except for liens in favor of Secured Party) pursuant to any indenture,
mortgage, deed of trust, bank loan, credit agreement, or other agreement or
instrument to which Debtor is a party;
(f) There are no suits or proceedings pending in court or before any
commission, board or other administrative agency against or affecting Debtor
which could, in the aggregate, have a material adverse effect on Debtor, its
business or operations, or its ability to perform its obligations under the Debt
Documents, nor does Debtor have reason to believe that any such suits or
proceedings are threatened;
(g) All financial statements delivered to Secured Party in connection with
the Indebtedness have been prepared in accordance with generally accepted
accounting principles, and since the date of the most recent financial
statement, there has been no material adverse change in Debtors financial
condition;
(h) The Collateral is not, and will not be, used by Debtor for personal,
family or household purposes;
(i) The Collateral is, and will remain, in good condition and repair and
Debtor will not be negligent in its care and use;
(j) Debtor is, and will remain, the sole and lawful owner, and in
possession of, the Collateral, and has the sole right and lawful authority to
grant the security interest described in this Agreement;
(k) The Collateral is, and will remain, free and clear of all liens,
claims and encumbrances of any kind whatsoever, except for (i) liens in favor of
Secured Party, (ii) liens for taxes not yet due or for taxes being contested in
good faith and which do not involve, in the judgment of Secured Party, any risk
of the sale, forfeiture or loss of any of the Collateral, and (iii) inchoate
materialmen's, mechanic's, repairmen's and similar liens arising by operation of
law in the normal course of business for amounts which are not delinquent (all
of such liens are called "Permitted Liens"); and
(l) Debtor is and will remain in full compliance with all laws and
regulations applicable to it including, without limitation, (i) ensuring that no
person who owns a controlling interest in or otherwise controls Debtor is or
shall be (Y) listed on the Specially Designated Nationals and Blocked Person
List maintained by the Office of Foreign Assets Control ("OFAC"), Department of
the Treasury, and/or any other similar lists maintained by OFAC pursuant to any
authorizing statute, Executive Order or regulation or (Z) a person designated
under Section 1(b), (c) or (d) of Executive Order No. 13224 (September 23,
2001), any related enabling legislation or any other similar Executive Orders,
and (ii) compliance with all applicable Bank Secrecy Act ("BSA") laws,
regulations and government guidance on BSA compliance and on the prevention and
detection of money laundering violations.
3. COLLATERAL.
(a) Until the declaration of any default, Debtor shall remain in
possession of the Collateral; except that Secured Party shall have the right to
possess (i) any chattel paper or instrument that constitutes a part of the
Collateral, and (ii) any other Collateral in which Secured Party's security
interest may be perfected only by possession. Secured Party may inspect any of
the Collateral during normal business hours after giving Debtor reasonable prior
notice. If Secured Party asks, Debtor will promptly notify Secured Party in
writing of the location of any Collateral.
(b) Debtor shall (i) use the Collateral only in its trade or business,
(ii) maintain all of the Collateral in good operating order and repair, normal
wear and tear excepted, (iii) use and maintain the Collateral only in compliance
with manufacturers recommendations and all applicable laws, and (iv) keep all of
the Collateral free and clear of all liens, claims and encumbrances (except for
Permitted Liens).
(c) Secured Party does not authorize and Debtor agrees it shall not (i)
part with possession of any of the Collateral (except to Secured Party or for
maintenance and repair), (ii) remove any of the Collateral from the continental
United States, or (iii) sell, rent, lease, mortgage, license, grant a security
interest in or otherwise transfer or encumber (except for Permitted Liens) any
of the Collateral.
(d) Debtor shall pay promptly when due all taxes, license fees,
assessments and public and private charges levied or assessed on any of the
Collateral, on its use, or on this Agreement or any of the other Debt Documents.
At its option, Secured Party may discharge taxes, liens, security interests or
other encumbrances at any time levied or placed on the Collateral and may pay
for the maintenance, insurance and preservation of the Collateral and effect
compliance with the terms of this Agreement or any of the other Debt Documents.
Debtor agrees to reimburse Secured Party, on demand, all costs and expenses
incurred by Secured Party in connection with such payment or performance and
agrees that such reimbursement obligation shall constitute Indebtedness.
(e) Debtor shall, at all times, keep accurate and complete records of the
Collateral, and Secured Party shall have the right to inspect and make copies of
all of Debtor's books and records relating to the Collateral during normal
business hours, after giving Debtor reasonable prior notice.
(f) Debtor agrees and acknowledges that any third person who may at any
time possess all or any portion of the Collateral shall be deemed to hold, and
shall hold, the Collateral as the agent of, and as pledge holder for, Secured
Party. Secured Party may at any time give notice to any third person described
in the preceding sentence that such third person is holding the Collateral as
the agent of, and as pledge holder for, the Secured Party.
4. INSURANCE.
(a) Debtor shall at all times bear the entire risk of any loss, theft,
damage to, or destruction of, any of the Collateral from any cause whatsoever.
(b) Debtor agrees to keep the Collateral insured against loss or damage by
fire and extended coverage perils, theft, burglary, and for any or all
Collateral which are vehicles, for risk of loss by collision, and if requested
by Secured Party, against such other risks as Secured Party may reasonably
require. The insurance coverage shall be in an amount no less than the full
replacement value of the Collateral, and deductible amounts, insurers and
policies shall be acceptable to Secured Party. Debtor shall deliver to Secured
Party policies or certificates of insurance evidencing such coverage. Each
policy shall name Secured Party as a loss payee, shall provide for coverage to
Secured Party regardless of the breach by Debtor of any warranty or
representation made therein, shall not be subject to co-insurance, and shall
provide that coverage may not be canceled or altered by the insurer except upon
thirty (30) days prior written notice to Secured Party. Debtor appoints Secured
Party as its attorney-in-fact to make proof of loss, claim for insurance and
adjustments with insurers, and to receive payment of and execute or endorse all
documents, checks or drafts in connection with insurance payments. Secured Party
shall not act as Debtor's attorney-in-fact unless Debtor is in default. Proceeds
of insurance shall be applied, at the option of Secured Party, to repair or
replace the Collateral or to reduce any of the Indebtedness.
5. REPORTS.
(a) Debtor shall promptly notify Secured Party of (i) any change in the
name of Debtor, (ii) any change in the state of its incorporation, organization
or registration, (iii) any relocation of its chief executive offices, (iv) any
relocation of any of the Collateral, (v) any of the Collateral being lost,
stolen, missing, destroyed, materially damaged or worn out, or (vi) any lien,
claim or encumbrance other than Permitted Liens attaching to or being made
against any of the Collateral. (b) Debtor will deliver to Secured Party
financial statements as follows. If Debtor is a privately held company, then
Debtor agrees to provide monthly financial statements, certified by Debtor's
president or chief financial officer including a balance sheet, statement of
operations and cash flow statement within 30 days of each month end and its
complete audited annual financial statements, certified by a recognized firm of
certified public accountants, within 120 days of fiscal year end or at such time
as Debtor's Board of Directors receives the audit. If Debtor is a publicly held
company, then Debtor agrees to provide quarterly unaudited statements and annual
audited statements, certified by a recognized firm of certified public
accountants, within 10 days after the statements are provided to the Securities
and Exchange Commission ("SEC"). All such statements are to be prepared using
generally accepted accounting principles ("GAAP") and, if Debtor is a publicly
held company, are to be in compliance with SEC requirements.
6. FURTHER ASSURANCES.
(a) Debtor shall, upon request of Secured Party, furnish to Secured Party
such further information, execute and deliver to Secured Party such documents
and instruments (including, without limitation, Uniform Commercial Code
financing statements) and shall do such other acts and things as Secured Party
may at any time reasonably request relating to the perfection or protection of
the security interest created by this Agreement or for the purpose of carrying
out the intent of this Agreement. Without limiting the foregoing, Debtor shall
cooperate and do all acts deemed necessary or advisable by Secured Party to
continue in Secured Party a perfected first security interest in the Collateral,
and shall obtain and furnish to Secured Party any
subordinations, releases, landlord waivers, lessor waivers, mortgagee waivers,
or control agreements, and similar documents as may be from time to time
requested by, and in form and substance satisfactory to, Secured Party.
(b) Debtor authorizes Secured Party to file a financing statement and
amendments thereto describing the Collateral and containing any other
information required by the applicable Uniform Commercial Code. Debtor
irrevocably grants to Secured Party the power to sign Debtor's name and
generally to act on behalf of Debtor to execute and file applications for title,
transfers of title, financing statements, notices of lien and other documents
pertaining to any or all of the Collateral; this power is coupled with Secured
Party's interest in the Collateral. Debtor shall, if any certificate of title be
required or permitted by law for any of the Collateral, obtain and promptly
deliver to Secured Party such certificate showing the lien of this Agreement
with respect to the Collateral. Debtor ratifies its prior authorization for
Secured Party to file financing statements and amendments thereto describing the
Collateral and containing any other information required by the Uniform
Commercial Code if filed prior to the date hereof.
(c) Debtor shall indemnify and defend the Secured Party, its successors
and assigns, and their respective directors, officers and employees, from and
against all claims, actions and suits (including, without limitation, related
attorneys' fees) of any kind whatsoever arising, directly or indirectly, in
connection with any of the Collateral.
7. DEFAULT AND REMEDIES.
(a) Debtor shall be in default under this Agreement and each of the other
Debt Documents if:
(i) Debtor breaches its obligation to pay when due any installment or
other amount due or coming due under any of the Debt Documents and fails to cure
the breach within ten (10) days;
(ii) Debtor, without the prior written consent of Secured Party,
attempts to or does sell, rent, lease, license, mortgage, grant a security
interest in, or otherwise transfer or encumber (except for Permitted Liens) any
of the Collateral;
(iii) Debtor breaches any of its insurance obligations under Section
4;
(iv) Debtor breaches any of its other obligations under any of the
Debt Documents and fails to cure that breach within thirty (30) days after
written notice from Secured Party;
(v) Any warranty, representation or statement made by Debtor in any of
the Debt Documents or otherwise in connection with any of the Indebtedness shall
be false or misleading in any material respect;
(vi) Any of the Collateral is subjected to attachment, execution,
levy, seizure or confiscation in any legal proceeding or otherwise, or if any
legal or administrative proceeding is commenced against Debtor or any of the
Collateral, which in the good faith judgment of Secured Party subjects any of
the Collateral to a material risk of attachment, execution, levy, seizure or
confiscation and no bond is posted or protective order obtained to negate such
risk;
(vii) Debtor breaches or is in default under any other agreement
between Debtor and Secured Party;
(viii) Debtor or any guarantor or other obligor for any of the
Indebtedness (collectively "Guarantor") dissolves, terminates its existence,
becomes insolvent or ceases to do business as a going concern;
(ix) If Debtor or any Guarantor is a natural person, Debtor or any
such Guarantor dies or becomes incompetent;
(x) A receiver is appointed for all or of any part of the property of
Debtor or any Guarantor, or Debtor or any Guarantor makes any assignment for the
benefit of creditors;
(xi) Debtor or any Guarantor files a petition under any bankruptcy,
insolvency or similar law, or any such petition is filed against Debtor or any
Guarantor and is not dismissed within forty-five (45) days;
(xii) Debtor's improper filing of an amendment or termination
statement relating to a filed financing statement describing the Collateral;
(xiii) There is a material adverse change in the Debtor's financial
condition as determined solely by Secured Party;
(xiv) Any Guarantor revokes or attempts to revoke its guaranty of any
of the Indebtedness or fails to observe or perform any covenant, condition or
agreement to be performed under any guaranty or other related document to which
it is a party;
(xv) Debtor defaults under any other material obligation for (A)
borrowed money, (B) the deferred purchase price of property or (C) payments due
under any lease agreement; or
(xvi) At any time during the term of this Agreement Debtor sells more
than 50% of its interest in the company to another corporation or business or
all or substantially all of its assets without Secured Party's prior written
consent.
(b) If Debtor is in default, the Secured Party, at its option, may declare
any or all of the Indebtedness to be immediately due and payable, without demand
or notice to Debtor or any Guarantor. The accelerated obligations and
liabilities shall bear interest (both before and after any judgment) until paid
in full at the lower of eighteen percent (18%) per annum or the maximum rate not
prohibited by applicable law.
(c) After default, Secured Party shall have all of the rights and remedies
of a Secured Party under the Uniform Commercial Code, and under any other
applicable law. Without limiting the foregoing, Secured Party shall have the
right to (i) notify any account debtor of Debtor or any obligor on any
instrument which constitutes part of the Collateral to make payment to the
Secured Party, (ii) with or without legal process, enter any premises where the
Collateral may be and take possession of and remove the Collateral from the
premises or store it on the premises, (iii) sell the Collateral at public or
private sale, in whole or in part, and have the right to bid and purchase at
said sale, or (iv) lease or otherwise dispose of all or part of the Collateral,
applying proceeds from such disposition to the obligations then in default. If
requested by Secured Party, Debtor shall promptly assemble the Collateral and
make it available to Secured Party at a place to be designated by Secured Party
which is reasonably convenient to both parties. Secured Party may also render
any or all of the Collateral unusable at the Debtor's premises and may dispose
of such Collateral on such premises without liability for rent or costs. Any
notice that Secured Party is required to give to Debtor under the Uniform
Commercial Code of the time and place of any public sale or the time after which
any private sale or other intended disposition of the Collateral is to be made
shall be deemed to constitute reasonable notice if such notice is given to the
last known address of Debtor at least five (5) days prior to such action.
(d) Proceeds from any sale or lease or other disposition shall be applied:
first, to all costs of repossession, storage, and disposition including without
limitation attorneys', appraisers', and auctioneers' fees; second, to discharge
the obligations then in default; third, to discharge any other Indebtedness of
Debtor to Secured Party, whether as obligor, endorser, guarantor, surety or
indemnitor; fourth, to expenses incurred in paying or settling liens and claims
against the Collateral; and lastly, to Debtor, if there exists any surplus.
Debtor shall remain fully liable for any deficiency.
(e) Debtor agrees to pay all reasonable attorneys' fees and other costs
incurred by Secured Party in connection with the enforcement, assertion, defense
or preservation of Secured Party's rights and remedies under this Agreement, or
if prohibited by law, such lesser sum as may be permitted. Debtor further agrees
that such fees and costs shall constitute Indebtedness.
(f) Secured Party's rights and remedies under this Agreement or otherwise
arising are cumulative and may be exercised singularly or concurrently. Neither
the failure nor any delay on the part of the Secured Party to exercise any
right, power or privilege under this Agreement shall operate as a waiver, nor
shall any single or partial exercise of any right, power or privilege preclude
any other or further exercise of that or any other right, power or privilege.
SECURED PARTY SHALL NOT BE DEEMED TO HAVE WAIVED ANY OF ITS RIGHTS UNDER THIS
AGREEMENT OR UNDER ANY OTHER AGREEMENT, INSTRUMENT OR PAPER SIGNED BY DEBTOR
UNLESS SUCH WAIVER IS EXPRESSED IN WRITING AND SIGNED BY SECURED PARTY. A waiver
on any one occasion shall not be construed as a bar to or waiver of any right or
remedy on any future occasion.
(g) DEBTOR AND SECURED PARTY UNCONDITIONALLY WAIVE THEIR RIGHTS TO A JURY
TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS
AGREEMENT, ANY OF THE OTHER DEBT DOCUMENTS, ANY OF THE INDEBTEDNESS SECURED
HEREBY, ANY DEALINGS BETWEEN DEBTOR AND SECURED PARTY RELATING TO THE SUBJECT
MATTER OF THIS TRANSACTION OR ANY RELATED TRANSACTIONS, AND/OR THE RELATIONSHIP
THAT IS BEING ESTABLISHED BETWEEN DEBTOR AND SECURED PARTY. THE SCOPE OF THIS
WAIVER IS INTENDED TO BE ALL ENCOMPASSING OF ANY AND ALL DISPUTES THAT MAY BE
FILED IN ANY COURT. THIS WAIVER IS IRREVOCABLE. THIS WAIVER MAY NOT BE MODIFIED
EITHER ORALLY OR IN WRITING. THE WAIVER ALSO SHALL APPLY TO ANY SUBSEQUENT
AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT, ANY OTHER
DEBT DOCUMENTS, OR TO ANY OTHER DOCUMENTS OR AGREEMENTS
RELATING TO THIS TRANSACTION OR ANY RELATED TRANSACTION. THIS AGREEMENT MAY BE
FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT.
8. MISCELLANEOUS.
(a) This Agreement, any Note and/or any of the other Debt Documents may be
assigned, in whole or in part, by Secured Party without notice to Debtor, and
Debtor agrees not to assert against any such assignee, or assignee's assigns,
any defense, set-off, recoupment claim or counterclaim which Debtor has or may
at any time have against Secured Party for any reason whatsoever. Debtor agrees
that if Debtor receives written notice of an assignment from Secured Party,
Debtor will pay all amounts payable under any assigned Debt Documents to such
assignee or as instructed by Secured Party. Debtor also agrees to confirm in
writing receipt of the notice of assignment as may be reasonably requested by
Secured Party or assignee.
(b) All notices to be given in connection with this Agreement shall be in
writing, shall be addressed to the parties at their respective addresses set
forth in this Agreement (unless and until a different address may be specified
in a written notice to the other party), and shall be deemed given (i) on the
date of receipt if delivered in hand or by facsimile transmission, (ii) on the
next business day after being sent by express mail, and (iii) on the fourth
business day after being sent by regular, registered or certified mail. As used
herein, the term "business day" shall mean and include any day other than
Saturdays, Sundays, or other days on which commercial banks in New York, New
York are required or authorized to be closed.
(c) Secured Party may correct patent errors and fill in all blanks in this
Agreement or in any Collateral Schedule consistent with the agreement of the
parties.
(d) Time is of the essence of this Agreement. This Agreement shall be
binding, jointly and severally, upon all parties described as the "Debtor" and
their respective heirs, executors, representatives, successors and assigns, and
shall inure to the benefit of Secured Party, its successors and assigns.
(e) This Agreement and its Collateral Schedules constitute the entire
agreement between the parties with respect to the subject matter of this
Agreement and supersede all prior understandings (whether written, verbal or
implied) with respect to such subject matter. THIS AGREEMENT AND ITS COLLATERAL
SCHEDULES SHALL NOT BE CHANGED OR TERMINATED ORALLY OR BY COURSE OF CONDUCT, BUT
ONLY BY A WRITING SIGNED BY BOTH PARTIES. Section headings contained in this
Agreement have been included for convenience only, and shall not affect the
construction or interpretation of this Agreement.
(f) This Agreement shall continue in full force and effect until all of
the Indebtedness has been indefeasibly paid in full to Secured Party or its
assignee. The surrender, upon payment or otherwise, of any Note or any of the
other documents evidencing any of the Indebtedness shall not affect the right of
Secured Party to retain the Collateral for such other Indebtedness as may then
exist or as it may be reasonably contemplated will exist in the future. This
Agreement shall automatically be reinstated if Secured Party is ever required to
return or restore the payment of all or any portion of the Indebtedness (all as
though such payment had never been made).
(g) Debtor authorizes Secured Party to use its name, logo and/or trademark
without notice to or consent by Debtor, in connection with certain promotional
materials that Secured Party may disseminate to the public. The promotional
materials may include, but are not limited to, brochures, video tape, internet
website, press releases, advertising in newspaper and/or other periodicals,
lucites, and any other materials relating the fact that Secured Party has a
financing relationship with Debtor and such materials may be developed,
disseminated and used without Debtor's review. Nothing herein obligates Secured
Party to use Debtor's name, logo and/or trademark, in any promotional materials
of Secured Party.
(h) THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER
SHALL IN ALL RESPECTS BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH, THE
INTERNAL LAWS OF THE STATE OF CONNECTICUT (WITHOUT REGARD TO THE CONFLICT OF
LAWS PRINCIPLES OF SUCH STATE), INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY
AND PERFORMANCE, REGARDLESS OF THE LOCATION OF THE COLLATERAL.
IN WITNESS WHEREOF, Debtor and Secured Party, intending to be legally
bound hereby, have duly executed this Agreement in one or more counterparts,
each of which shall be deemed to be an original, as of the day and year first
aforesaid.
SECURED PARTY: DEBTOR:
General Electric Capital Corporation SIGA Technologies, Inc.
By: /s/ John Edel By: /s/ Thomas N. Konatich
---------------------------- -----------------------------
Name: John Edel Name: Tom Konatich
Title: Senior Vice President Title: Chief Finanical Officer