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SIGA Technologies Inc. Message Board

  • csmclemore csmclemore May 28, 2013 6:06 PM Flag

    Why an income stream is not available as part of a remedy:

    An income stream might be available to PIP if the LATS was found to be binding on the parties; it wasn't. It was already a stretch for Parsons to find that, if not for SIGA's bad faith, the parties would have agreed on the terms of and bound themselves to a yet to be negotiated license agreement that did not have to have terms in strict accordance with the LATS. It is impossible to know what the terms of such a license agreement would have been when "the parties also recognized that the negotiations probably would introduce new terms and lead to some adjustment of terms expressly embodied in the LATS, while other terms in the LATS were almost certain to remain.” Fundamentally, how do you determine the terms of a yet to be negotiated license agreement that does not have to conform to the terms of the LATS with any certainty?

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    • When have you been correct about siga? The Lats were ruled an enforceable contract by SC I thought?

      • 1 Reply to mymygbye
      • Your right. According to the Delaware Supreme Court ruling page 26: "The express contractual language in the Bridge Loan and Merger Agreements obligated the parties to 'negotiate in good faith with the intention of executing a definitive License Agreement in accordance with the terms set for in the' LATS. The question becomes whether the language 'in accordance with the terms set forth' means that the parties had a duty, as the Vice Chancellor [Parsons] found, 'to negotiate toward a license agreement with economic terms substantially similar to the terms of the LATS' . . . or whether the parties intended the LATS merely as a 'jumping off point.'

        After setting aside SIGA's arguments in its own defense, Delaware Supreme Court goes on (page 28) to say:

        The record supports the Vice Chancellor's finding that 'SIGA disregarded (the LATS') terms and attempted to negotiate a definitive license agreement that contained economic terms . . . drastically different . . . than those of the LATS.'

        Page 29 "Drapkin offer[ed] his counterfactual recollection that the LATS (was) nothing but a 'jumping off point'".

        Highlights Parsons' finding that SIGA was suffering from sellers remorse, bolstering his finding that SIGA failed to negotiate in good faith in accordance with the terms of the LATS.

        All caps added below for emphasis

        "Therefore, we affirm the Vice Chancellor' conclusion that SIGA acted in bad faith when negotiating the license agreement in BREACH OF ITS CONTRACTUAL OBLIGATION under both the Merger Agreement and the Bridge Loan Agreement."

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