SIGA Receives $8 Million in Financing Support from MacAndrews & Forbes
NEW YORK - SIGA Technologies, a company specializing in the development of pharmaceutical agents to fight bio-warfare pathogens, today announced that one of its largest investors, MacAndrews & Forbes LLC, has agreed to supply as needed up to $8.0 million in financing.
Under the agreement, SIGA has the option at any time in the next 12 months to cause MacAndrews & Forbes to purchase newly issued shares of common stock in up to three tranches at a purchase price per share equal to the lesser of $3.06 and the average of the volume-weighted average price per share for the five trading days immediately preceding the date of the purchase. In aggregate, the Company may cause MacAndrews & Forbes to purchase up to $8.0 million in new shares. As additional consideration for this standby purchase commitment, in conjunction with each sale of common stock, the Company will issue warrants to MacAndrews & Forbes to purchase up to 40% of the number of shares of common stock it acquires, at an exercise price equal to 115% of the purchase price of the shares. MacAndrews & Forbes has also obtained the corresponding right to cause SIGA to issue new shares for purchase on the same terms. SIGA also issued 238,000 warrants to MacAndrews & Forbes to acquire shares of common stock at a price of $3.06 per share in consideration for its commitment.
SIGA will use the proceeds from these stock sales to fund its ongoing research and development activities, to enhance its ability to commercialize its products and for general corporate purposes.
Commenting on the support for SIGA shown by one of its largest investors, Dr. Eric A. Rose, CEO of SIGA Technologies, stated, "This agreement is a significant affirmation of the progress that SIGA has made. Obtaining this commitment now assures our investors and partners that SIGA will have the financial strength it needs as it continues towards its near-term goal of commercializing our lead product candidate, ST-246, and makes additional progress on its pipeline of drugs in development.
The agreement was negotiated on SIGA's behalf by a special committee of members of the Board of Directors not associated with MacAndrews & Forbes and was approved by the entire Board The description of the agreement set forth in this announcement, is a summary only, and investors are urged to review the complete terms of the agreement, which will be filed by SIGA with the SEC as an exhibit to a Current Report on Form 8-K.
About SIGA Technologies, Inc.
SIGA Technologies is applying viral and bacterial genomics and sophisticated computational modeling in the design and development of novel products for the prevention and treatment of serious infectious diseases, with an emphasis on products for biological warfare defense. SIGA believes that it is a leader in the development of pharmaceutical agents to fight potential bio-warfare pathogens. SIGA has antiviral programs targeting smallpox and other Category A pathogens, including arenaviruses (Lassa fever, Junin, Machupo, Guanarito, Sabia, and lymphocytic choriomeningitis), dengue virus, and the filoviruses (Ebola and Marburg). For more information about SIGA, please visit SIGA's Web site at http://www.siga.com/.
This press release contains or implies certain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, as amended, including statements regarding the sale of securities pursuant to the agreement and the use of proceeds. Forward-looking statements are based on management's estimates, assumptions and projections, and are subject to uncertainties, many of which are beyond SIGA's control. Actual results may differ materially from those anticipated in any forward-looking statement. Factors that may cause such differences include the risks that (a) potential products that appear promising to SIGA or its collaborators cannot be shown to be efficacious or safe in subsequent pre-clinical or clinical trials, (b) SIGA or its collaborators will not obtain appropriate or necessary governmental approvals to market these or other potential products, (c) SIGA may not be able to obtain anticipated funding for its development projects or other needed funding, (d) SIGA may not be able to secure funding from anticipated government contracts and grants, (e) SIGA may not be able to secure or enforce sufficient legal rights in its products, including sufficient patent protection for its products and (f) regulatory approval for SIGA's products may require further or additional testing that will delay or prevent approval. More detailed information about SIGA and risk factors that may affect the realization of forward-looking statements, including the forward-looking statements in this press release, is set forth in SIGA's filings with the Securities and Exchange Commission, including SIGA's Annual Report on Form 10-K for the fiscal year ended December 31, 2007, and in other documents that SIGA has filed with the Commission. SIGA urges investors and security holders to read those documents free of charge at the Commission's Web site at http://www.sec.gov. Interested parties may also obtain those documents free of charge from SIGA. Forward-looking statements speak only as to the date they are made, and, except for any obligation under the U.S. federal securities laws, SIGA undertakes no obligation to publicly update any forward-looking statement as a result of new information, future events or otherwise.