<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>2
<FILENAME>kl00503_ex10-1.txt
<DESCRIPTION>EXHIBIT 10.1 SERVICE AGREEMENT
<TEXT>
                                                                    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.

<PAGE>

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.

<PAGE>

      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.

<PAGE>

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.

<PAGE>

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


</TEXT>
</DOCUMENT>
