Tonix Pharmaceuticals Holding Corp. 10-Q


 


Exhibit
10.01 


 





CERTAIN
IDENTIFIED INFORMATION HAS BEEN EXCLUDED FROM THIS EXHIBIT BECAUSE IT IS NOT MATERIAL AND WOULD LIKELY CAUSE COMPETITIVE HARM
TO THE REGISTRANT IF PUBLICLY DISCLOSED. THE OMISSIONS HAVE BEEN INDICATED BY “[***].”


 


EXECUTION
COPY


 


ASSET
PURCHASE AGREEMENT


 


This
ASSET PURCHASE AGREEMENT (“Agreement”), dated August 19, 2019 (the “Effective Date”),
is entered into by and among TRImaran Pharma, Inc., a Delaware corporation (“Seller”), Tonix Pharmaceuticals,
Inc., a Delaware corporation (“Buyer”) and, solely for the purposes of Section 3.1(b), Section 6.1,
Section 6.2 and Exhibit F, each of the Seller Shareholders (as defined below).


 


Background


 


WHEREAS,
Seller is the sole owner of the Purchased Assets (as defined below); and


 


WHEREAS,
Seller desires to sell, transfer and assign to Buyer, and Buyer desires to acquire and assume from Seller, all of the Purchased
Assets and Assumed Liabilities, all as more specifically provided herein;


 


NOW,
THEREFORE, in consideration of the foregoing and the representations, warranties, covenants and agreements contained herein,
and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties, intending
to be legally bound, hereby agree as follows:


 


ARTICLE
1

DEFINITIONS


 


Section
1.1      Definitions


 


All
terms not defined below are as defined elsewhere in this Agreement.


 


“Affiliate”
means any Person that directly or indirectly Controls, is Controlled by or is under common Control with another Person. A Person
will be deemed to “Control” another Person if it has the power to direct or cause the direction of the other
Person, whether through ownership of securities, by contract or otherwise.


 


“Applicable
Laws” means, in respect of any Person, property, transaction, event or course of conduct, all applicable laws, statutes,
regulations, rules, ordinances, regulatory policies, codes, guidelines, official directives, orders, rulings, judgments and decrees
of any Governmental Authority.


 


“Assumed
Liabilities” means (a) any Liabilities of the Seller arising after the Effective Date under the Transferred Contracts
and (b) certain accounts payable of Seller identified on Exhibit A attached hereto (up to a maximum, aggregate amount of
$68,500), to the extent evidenced by invoices from the applicable payee or other documentation reasonably acceptable to Buyer.


 


“Business
Day” means any day other than a Saturday, Sunday or other day on which banks in New York, New York, USA, are permitted
or required to close by law or regulation.


 






     


     


    

 


“Compounds”
means any and all Pyran-based compounds under development by Seller, including, but not limited to, those certain Pyran-based
compounds described on Exhibit B.


 


“Encumbrance”
means any mortgage, charge, lien, security interest, easement, right of way, pledge or encumbrance of any nature whatsoever.


 


“Excluded
Liabilities” means any and all Liabilities of Seller that are not expressly included in the definition of Assumed Liabilities,
including, but not limited to:


 


(a)       any
and all Liabilities arising prior to or on the Effective Date under the Transferred Contracts;


 


(b)       any
and all Liabilities of Seller with respect to taxes;


 


(c)       any
and all Liabilities arising out of or otherwise relating to the employment or service of any person by Seller;


 


(e)       any
and all Liabilities of Seller under this Agreement or incurred in connection with the negotiation or consummation of this Agreement;
and


 


(f)       any
and all Liabilities of the Seller arising out of events, transactions, facts, acts or omissions which occurred prior to or on
the Effective Date.


 


“FDA”
means the United States Food and Drug Administration or any successor agency performing similar functions.


 


“Governmental
Authority” means any court, governmental agency, department or commission or other governmental authority or instrumentality,
including, but not limited to, the FDA.


 


“Intellectual
Property Rights” means all right, title and interest of Seller (including, but not limited to, rights held under any
other Transferred Contract) in and to (a) the Patent Rights, (b) the Trademarks, (c) the Know-How, (d) the Technical Information
and (e) any copyrights and other intellectual property related to any of the foregoing, the Technology and/or any of the Compounds.


 


“Know-How”
means any know-how, show-how, technical and non-technical information, trade secrets, formulae, techniques, sketches, drawings,
materials, models, inventions, designs, specifications, processes, apparatus, equipment, databases, research, experimental work,
development, pharmacology and clinical data, software programs and applications, software source documents, third-party licenses,
and any other type of intellectual property right (other than the Patent Rights), in each case related to the Technology and/or
any of the Compounds.


 


“Liabilities”
means any and all debts, liabilities and obligations, whether accrued or fixed, absolute or contingent, matured or unmatured,
or determined or determinable, including those arising under any law, action or governmental order and those arising under any
contract, agreement, arrangement, commitment or undertaking, or otherwise.


 


“Losses”
means, collectively, any and all damages, losses, taxes, Liabilities, claims judgments, penalties, costs and expenses (including
reasonable legal fees and expenses).


 







     -2-


     


    

 


“Net
Sales” means the amount invoiced by Buyer or any of its Affiliates (each, a “Selling Party”) for
sales of a given Product to a Third Party purchaser, less any and all deductions actually taken by a Selling Party with respect
to Product sales in accordance with U.S. generally accepted accounting principles as in effect at the relevant time or for the
relevant period, applied on a consistent basis during the period involved, including, but not limited to, deductions for:


 





		(a)	trade,
                                         quantity and cash discounts, coupons, rebates and other price reductions for the Product;



 


		(b)	credits
                                         and allowances for rejection or return of Products previously sold, price protection
                                         and shelf stock adjustments; reprocurement charges and other similar charges and inventory
                                         management fees;



 


		(c)	amounts
                                         written off as bad debt; and



 


		(d)	rebates
                                         and chargebacks, including, but not limited to, any payments required by law to be made
                                         under Medicaid, Medicare or other government medical assistance programs.



 


Notwithstanding
anything to the contrary, the transfer of a Product shall not be considered a sale of a Product under this Agreement to the extent
such transfer (i) is in connection with the research, development or testing of a Product or (ii) is for sample purposes.


 


For
the avoidance of doubt, the transfer of Product by a Selling Party or one of its Affiliates to another Affiliate of such Selling
Party for resale shall not be considered a sale; in such cases, Net Sales shall be determined based on the amount invoiced or
otherwise billed by such Affiliate to an independent Third Party, less the Net Sales Deductions allowed under this Section.


 


“Parties”
means collectively the Seller and Buyer.


 


“Party”
means either the Seller or Buyer.


 


“Patent
Rights” means (a) all patents and patent applications licensed to Seller pursuant to the WSU License (including, but
not limited to, the patents and patent applications listed on Exhibit C) and (b) any and all other patents and patent applications
owned by or licensed to Seller.


 


“Person”
means any individual, corporation, partnership, limited liability company, joint venture, trust, business association, organization,
Governmental Authority or other entity.


 


“Product”
means any pharmaceutical product that incorporates any of the Compounds.


 


“Purchased
Assets” means:


 


		(a)	the
                                         Intellectual Property Rights;



 


		(b)	the
                                         Transferred Contracts;



 


		(c)	any
                                         inventories of Compound or other supplies, equipment and other tangible assets used in
                                         connection with the development of the Compounds;



 


		(d)	all
                                         authorizations, consents, approvals, licenses, orders, permits and exemptions of, and
                                         filings or registrations with, any Governmental Authority, to the extent transferable
                                         by the Seller;



 






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		(e)	all
                                         books, records, files and papers relating to, or necessary to the conduct of, the Seller’s
                                         Business;



 


		(f)	all
                                         rights and claims of the Seller, whether mature, contingent or otherwise, against any
                                         Person, whether in tort, contract or otherwise, including, without limitation, causes
                                         of action, unliquidated rights and claims under or pursuant to all warranties, representations
                                         and guarantees made by manufacturers, suppliers or vendors, claims for refunds, rights
                                         of off-set and credits of all kinds and all other general intangibles; provided,
                                         however, that such rights and claims shall not include any rights and claims of
                                         Seller under this Agreement;



 


		(g)	the
                                         benefit of coverage provided by all current and expired insurance policies of Seller
                                         to the extent they relate to any of the Purchased Assets or Assumed Liabilities; and



 


		(h)	all
                                         other assets used or useful in the development of the Compounds, whether or not reflected
                                         on the books and records of the Seller.



 


“Seller
Shareholders” means each of the following individuals: Walter Piskorski, Frank Bymaster, Timothy Hsu and Aloke Dutta,
Ph.D..


 


“Technical
Information” means any and all data and other information that exists as of the Effective Date and relates to the Technology
and/or any of the Compounds or is otherwise necessary or useful for the further development or commercialization of any of the
Compounds or any Products, including, but not limited to, any investigational new drug applications, correspondence with FDA or
other governmental authorities, clinical data, pre-clinical data, adverse event data, pharmaceutical development reports, formulations
and any and all other medical and technical information.


 


“Technology”
means the inventions described in the Patent Rights and any and all other technology under development by Seller related to the
Compounds and/or any Products.


 


“Third
Party” means any legal person, entity or organization other than Buyer, Seller or an Affiliate of either Party.


 


“Tonix
Stock” means the common stock of Tonix Pharmaceuticals Holding Corp., which is the parent company of Buyer.


 


“Trademarks”
means all rights with respect to (a) the “TRImaran Pharma” trademark, trade name and related logo, (b) the trimaranpharmainc.com
domain name and (c) any and all other trademarks, service marks, service names, trade names, internet domain names, brand marks,
brands, trade dress, package designs, product inserts, labels, logos and associated artwork owned by Seller, including any and
all applications or registrations for any of the foregoing, and extensions, renewals, continuations or re-issues thereof, or amendments
or modifications thereto.


 


“Trading
Day” means a day on which Tonix Stock trades on the NASDAQ exchange.


 


“Transferred
Contracts” means (a) the WSU License and (b) the contracts listed on Exhibit D.


 


“WSU
License” means that certain Exclusive License Agreement dated January 11, 2016, by and between Seller and Wayne State
University.


 



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Section
1.2            Interpretation. When used in this Agreement the words “include”, “includes” and “including”
will be deemed to be followed by the words “without limitation.” Any terms defined in the singular will have a comparable
meaning when used in the plural, and vice-versa.


 


Section
1.3            Currency. All currency amounts referred to in this Agreement are in United States Dollars, unless otherwise specified.


 


ARTICLE
2

PURCHASE AND SALE OF ASSETS


 


Section
2.1            Purchase and Sale. Seller hereby sells, assigns, transfers, conveys and delivers to Buyer, and Buyer hereby purchases,
acquires and accepts, all right, title and interest in and to the Purchased Assets, free and clear of all Encumbrances.


 


Section
2.2            Assumption of Assumed Liabilities; Excluded Liabilities. Buyer hereby assumes only the Assumed Liabilities. Buyer will
not assume or be liable for any of the Excluded Liabilities. Seller shall pay, discharge and satisfy, as they become due, all
Excluded Liabilities.


 


Section
2.3            Deliveries. Within three (3) business days after the Effective Date, Seller will deliver to Buyer (a) any tangible
materials included in the Purchased Assets and (b) copies (in the format in which they are maintained by Seller) of all books,
records, data, contracts, files and other information included in the Purchased Assets.


 


Section
2.4 Amended and Restated WSU License. Prior to the Effective Date, Buyer and WSU have entered into an Amended and Restated
Exclusive License Agreement, which becomes effective as of the Effective Date and, as of the Effective Date, replaces and supersedes
the WSU License in its entirety.


 


 


 


ARTICLE
3

FINANCIAL TERMS


 


Section
3.1            Purchase Price. As consideration for the Purchased Assets, in addition to Buyer’s assumption of the Assumed Liabilities,
on the twenty-first (21st) Trading Day after occurrence of a milestone set forth in the below table (each, a “Milestone”),
Buyer will, at Buyer’s option, either (a) cause to be issued a number of restricted shares of Tonix Stock determined by
dividing (i) the “Consideration Amount” set forth in the below table for such Milestone by (ii) the volume-weighted
average price of Tonix Stock on the NASDAQ exchange over the preceding twenty (20) Trading Days (the “Equity Consideration”)
or (b) make a cash payment equal to the “Consideration Amount” set forth in the below table for such Milestone (“Cash
Consideration”). For the avoidance of doubt, the decision as to whether to provide Equity Consideration or Cash Consideration
(collectively, “Consideration”) for a given Milestone will be made by Buyer in its sole discretion on a Milestone-by-Milestone
basis.


 


	Milestone	Consideration
    Amount
	Effective
    Date	$100,000
	[***]	$[***]


 



     -5-


     


    




 





	Milestone	Consideration
    Amount
	[***]	$[***]
	[***]	$[***]
	[***]	$[***]
	[***]	$[***]
	[***]	$[***]
	[***]	$[***]
	[***]	$[***]


  


		(a)	Buyer
                                         will pay a portion of any Cash Consideration (or cause a portion of any Equity Consideration
                                         to be issued) to each of the Seller Shareholders in the proportions listed on Exhibit
                                         E. For the avoidance of doubt: (a) any Consideration for a given Milestone will be
                                         issued one-time only, even if such Milestone is achieved more than once, (b) each amount
                                         set forth in the above table for each Milestone is the aggregate Consideration to be
                                         paid or issued by Buyer for such Milestone and (c) Buyer will not pay or issue any Consideration
                                         directly to Seller.



 


		(b)	Any
                                         shares of Tonix Stock to be issued pursuant to this Agreement have not been registered
                                         under the Securities Act of 1933, as amended, or state securities laws and may not be
                                         offered or sold in the United States absent registration with the Securities and Exchange
                                         Commission or an applicable exemption from such registration requirements. Any shares
                                         of Tonix Stock to be issued pursuant to this Agreement are subject to a lock-up period
                                         ending on the date that is six (6) months after the date on which such shares are issued.
                                         Such lock-up period is binding on transferees of such shares. Concurrently with the execution
                                         of this Agreement, and as a condition to the issuance of any Equity Consideration, Seller
                                         shall cause each Seller Shareholder to execute a Lock-Up Agreement in the form attached
                                         hereto as Exhibit F.



 


Section
3.2            Taxes. Each Party agrees to report (and to cause its
Affiliates to report) the transactions contemplated by this Agreement in a manner consistent with applicable law and with the
terms of this Agreement, and agrees not to take any position inconsistent therewith on any tax return, in any tax refund
claim, in any litigation or otherwise. [***] Buyer shall have no obligation, however, for any capital gains or other income
taxes owed by Seller as a result of the transaction.


 


ARTICLE
4

REPRESENTATIONS AND WARRANTIES OF SELLER


 


Seller
hereby represents and warrants to Buyer as follows:


 


Section
4.1            Organization; Authority; Execution and Delivery. Seller is a corporation, duly organized, validity existing and in
good standing under the laws of the State of Delaware. Seller has the requisite corporate power and authority to enter into this
Agreement and to consummate the transaction contemplated hereby. The execution and delivery of this Agreement by Seller and the
consummation of the transactions contemplated hereby have been validly authorized. This Agreement has been executed and delivered
by Seller and, assuming the due authorization, execution and delivery of this Agreement by Buyer, will constitute the legal and
binding obligation of Seller, enforceable against it in accordance with its terms, subject to applicable bankruptcy, insolvency,
reorganization, moratorium, fraudulent transfer and other similar laws affecting creditors’ rights generally from time to
time in effect and to general principles of equity (including concepts of materiality, reasonableness, good faith and fair dealing)
regardless of whether considered in a proceeding in equity or at law.


 






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Section
4.2            Consents; No Violation, Etc. The execution and delivery of this Agreement do not, and the consummation of the transactions
contemplated hereby (including the transfer of the Purchased Assets to Buyer) and the compliance with the terms hereof will not:
(i) violate any Applicable Law applicable to Seller, (ii) conflict with any provision of the certificate of incorporation or by-laws
(or similar organizational document) of Seller, (iii) conflict with or violate any Transferred Contract or any other contract
to which Seller is a party or by which it is otherwise bound or (iv) require Seller to obtain any approval, authorization, consent,
license, exemption, filing or registration from or with any court, arbitrator, Governmental Authority or pursuant to any contract
by which Seller is bound or that otherwise relates to any of the Purchased Assets or the Product.


 


Section
4.3            Litigation. There are no claims, suits, actions or other proceedings pending or threatened in writing against Seller
at law or in equity before or by any Governmental Authority, domestic or foreign, involving or related to the Purchased Assets
or which may in any way adversely affect the performance of Seller’s obligations under this Agreement or the transactions
contemplated hereby.


 


Section
4.4            Title to Purchased Assets. Immediately prior to the transfer of the Purchased Assets to Buyer, Seller is the sole and
exclusive owner of, has good and valid title to all of the Purchased Assets, free and clear of all Encumbrances, and has the right
to convey the same to Buyer without conflicting with the terms of any contract to which Seller or any of its Affiliates is bound.
No Third Party holds any license, option, reversionary interest or other right with respect to any of the Purchased Assets or
the Product.


 


Section
4.5            No Undisclosed Liabilities. Seller does not have any Liabilities, except for immaterial Liabilities incurred since
December 31, 2018, in the ordinary course of the business of Seller that do not exceed [***] (none of which results from, arises
out of or relates to any breach or violation of, or default under, any Transferred Contract or Applicable Law).


 


Section
4.6            Transferred Contracts. Seller has delivered to Buyer complete copies of each of the Transferred Contracts, including
any and all amendments thereto and (i) each Transferred Contract is valid, binding and enforceable on Seller (subject to applicable
bankruptcy, insolvency, reorganization, moratorium, fraudulent transfer and other similar laws affecting creditors’ rights
generally from time to time in effect and to general principles of equity regardless of whether considered in a proceeding in
equity or at law) and is in full force and effect, (ii) neither Seller (nor to Seller’s knowledge, any other party to a
Transferred Contract) is in material breach or violation of, or default under, any Transferred Contract and (iii) no consent of
any Person is required in connection with the assignment of the Transferred Contracts to Buyer pursuant to this Agreement.


 


Section
4.7            Compliance with Applicable Law. The research and development of the Compounds and the Technology has at all times been
conducted in compliance with all applicable Government Rules.


 






     -7-


     


    

 


Section
4.8            Product Intellectual Property. There are no Patent Rights, other than the Patent Rights that are licensed to Seller
pursuant to the WSU License. All of the Intellectual Property Rights are valid, enforceable and in full force and effect. To Seller’s
knowledge, the use of the Compounds and the Technology in connection with the development, manufacture, use, sale and commercialization
of any Products does not and will not infringe, misappropriate or violate any patent, copyright, trade secret or other intellectual
property or contractual right of any Third Party. Seller has not received any charge, complaint, claim, demand, or notice alleging
any such infringement, misappropriation, or violation in the Territory (including any claim that Seller must license or refrain
from using any intellectual property rights relating to the Compound or any Technology).


 


Section
4.9            No Other Product-Related Assets. The Purchased Assets constitute substantially all of the assets of Seller. Except
for the Purchased Assets, neither Seller nor any of its Affiliates nor any Selling Shareholder holds any ownership, license, option,
right of reference or other right or interest in or to any patent, copyright, trade secret, trademark, data, know-how, contractual
right or other tangible or intangible asset that is necessary or useful for the development or commercialization of the Technology
or any Compound or Product.


 


Section
4.10         Taxes. Seller does not have any Liability with respect to any taxes for which Buyer would reasonably be expected to
become liable or that would reasonably be expected to adversely affect Buyer’s right to use and enjoy any of the Purchased
Assets, free and clear of any Encumbrances, including liens for Taxes.


 


Section
4.11         No Brokers. Neither Seller nor any of its Affiliates has any liability or obligation to pay any fees or commissions
to any broker, finder or other agent with respect to this Agreement for which Buyer could become liable or obligated or which
could result in an Encumbrance being filed against any of the Purchased Assets.


 


Section
4.12          No Other Representations or Warranties. Except for the representations and warranties of Seller expressly set forth
in this Article 4 and in Exhibit E, neither Seller nor any other Person makes any other express or implied representation
or warranty on behalf of Seller.


 


ARTICLE
5

REPRESENTATIONS AND WARRANTIES OF BUYER





 


Buyer
hereby represents and warrants to Seller as follows:


 


Section
5.1            Organization; Authority; Execution and Delivery. Buyer is a duly organized, validly existing and in good standing under
the laws of the State of Delaware. Buyer has the company power and authority to enter into this Agreement and to consummate the
transactions contemplated hereby. The execution and delivery of this Agreement by Buyer and the consummation of the transactions
contemplated hereby have been authorized. This Agreement has been executed and delivered by Buyer and, assuming the due authorization,
execution and delivery of this Agreement by Seller, constitutes the legal and binding obligation of Buyer, enforceable against
Buyer in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent transfer
and other similar laws affecting creditors’ rights generally from time to time in effect and to general principles of equity
(including concepts of materiality, reasonableness, good faith and fair dealing regardless) of whether considered in a proceeding
in equity or at law.


 






     -8-


     


    

 


Section
5.2            Consents; No Violations, Etc. The execution and delivery of this Agreement do not, and the consummation of the transactions
contemplated hereby (including the transfer of the Purchased Assets to Buyer) and the compliance with the terms hereof will not:
(i) violate any Applicable Law applicable to Buyer, (ii) conflict with any provision of the operating agreement (or similar organizational
document) of Buyer, (iii) conflict with or violate any contract to which Buyer or any of its Affiliates is a party or by which
it is otherwise bound or (iv) require Buyer or any of its Affiliates to obtain any approval, authorization, consent, license,
exemption, filing or registration from or with any court, arbitrator, Governmental Authority or pursuant to any contract by which
Buyer or any of its Affiliates is bound.


 


Section
5.3            No Brokers. Neither Buyer nor any of its Affiliates has any liability or obligation to pay any fees or commissions
to any broker, finder or other agent with respect to this Agreement for which Seller could become liable or obligated.


 


Section
5.4            No Other Representations or Warranties. Except for the representations and warranties of Buyer expressly set forth
in this Article 5, neither Buyer nor any other Person makes any other express or implied representation or warranty on
behalf of Buyer.


 


ARTICLE
6

OTHER AGREEMENTS


 


Section
6.1            Restrictive Covenants. As a material inducement for Buyer to enter into this Agreement, Seller and each Seller Shareholder
agrees to the covenants and restrictions set forth below in this Section 6.1, and Seller and each Seller Shareholder hereby
acknowledges and agrees that Buyer would not execute and deliver this Agreement and consummate the transactions contemplated hereby
in the absence of such covenants by Seller and the Seller Shareholders.


 


		(a)	Seller
                                         and each Seller Shareholder: (i) shall not, directly or indirectly, disclose or use or
                                         otherwise exploit for their own benefit or for the benefit of any other Person, any of
                                         the Know-How, Technical Information or other non-public information included in the Purchased
                                         Assets (collectively, “Confidential Information”) and (ii) shall safeguard
                                         any Confidential Information in their possession or control by all reasonable measures.
                                         Seller and each Seller Shareholder acknowledges and agrees that any and all Confidential
                                         Information will be, as of the Effective Date, the exclusive property of Buyer.



 


		(b)	For
                                         a period of three (3) years from the Effective Date (the “Restricted Period”),
                                         Seller and each Seller Shareholder shall not (whether directly or through any Affiliate,
                                         licensee or other Third Party) engage the development or commercialization of any therapeutic
                                         containing any pyran-based drug compound for the treatment of post-traumatic stress disorder,
                                         attention deficit hyperactivity disorder or major depressive disorder (the “Restricted
                                         Field”) (provided, however, that nothing in this Section 6.1(b) shall restrict
                                         Aloke Dutta from conducting research activities for WSU or any other academic institution).



 


		(c)	Each
                                         Seller Shareholder further agrees that, during the Restricted Period, he will not directly
                                         or indirectly, serve as director, consult with, provide services to, own any interest
                                         in or otherwise provide finances to any Person that is engaged in the Restricted Field
                                         (other than ownership of stock or other securities in a publicly traded entity).



 


		(d)	During
                                         the Restricted Period, Seller and each Seller Shareholder shall not solicit for employment
                                         or other engagement any employee or agent of Buyer or any of its Affiliates.



 






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Section
6.2            Notice to Buyer of CNS Candidates. In the event that during the Restricted Period, Seller or any Seller Shareholder
engages in the research or development of any potential therapeutic compound for the treatment of any central nervous system disorder
in humans (a “CNS Candidate”), Seller or such Seller Shareholder (as applicable) shall promptly notify Buyer
of such CNS Candidate and provide Buyer a reasonable opportunity to make an offer to acquire or license rights with respect to
such CNS Candidate.


 


Section
6.3            Seller’s Name. Within ten (10) Business Days after the Effective Date, Seller shall (a) amend its Certificate
of Incorporation to a name not containing the word “TRImaran” or any term confusingly similar thereto and (b) abandon
any and all fictitious business name filing(s) for any name that includes “TRImaran” or any term confusingly similar
thereto.


 


Section
6.4           Bulk Sales. Seller shall use best efforts to comply with the provisions of any bulk sales, bulk transfer or similar
Applicable Laws of any jurisdiction that may otherwise be applicable with respect to the sale of any or all of the Purchased Assets
to Buyer; it being understood that any Liabilities arising out of the failure of Seller to comply with the requirements and provisions
of any bulk sales, bulk transfer or similar Applicable Laws of any jurisdiction shall be treated as Excluded Liabilities.


 


Section
6.5           Further Assurances. Each Party, upon the request of the other Party and without further consideration, will do, execute,
acknowledge and deliver or cause to be done, executed, acknowledged or delivered all such further acts, deeds, documents, assignments,
transfers, conveyances, powers of attorney and assurances as may be reasonably necessary to effect complete consummation of the
transactions contemplated by this Agreement.


 


ARTICLE
7

INDEMNIFICATION; LIABILITY


 


Section
7.1 Indemnification by Seller. Seller hereby agrees to indemnify and defend Buyer and its Affiliates, and their respective
officers, directors and employees (the “Buyer Indemnified Parties”) against, and agrees to hold them harmless
from, any Losses to the extent such Losses arise from or in connection with the following:


 


(a)           any
breach by Seller of any representation or warranty made by Seller under this Agreement;


 


(b)           any
breach by Seller of any of its covenants, agreements or obligations contained in this Agreement;


 


(c)           any
taxes of Seller; and


 


(d)           any
of the Excluded Liabilities.


 


Section
7.2 Indemnification by Buyer. Buyer hereby agrees to indemnify and defend Seller and its officers, directors and employees
(the “Seller Indemnified Parties”) against, and agrees to hold them harmless from, any Losses to the extent
such Losses arise from or in connection with the following:


 


(a)           any
breach by Buyer of any representation or warranty made by Buyer under this Agreement;


 






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(b)           any
breach by Buyer of any of its covenants, agreements or obligations contained in this Agreement; and


 


(c)           any
of the Assumed Liabilities.


 


Section
7.3           Certain Limitations. The aggregate amount of all Losses that may be recovered by the Buyer Indemnified Parties from
Seller pursuant to all claims for indemnification for breaches of representations and/or warranties under Section 7.1(a)
(other than with respect to (A) fraud and/or (B) Seller’s breach of any of the representations or warranties in Section
4.1 (“Organization; Authority; Execution and Delivery”), Section 4.2 (“Consents; No Violation, Etc.”)
or Section 4.4 (“Title to Purchased Assets”) (collectively, the “Fundamental Representations”)),
and the aggregate amount of all Losses that may be recovered by the Seller Indemnified Parties from Buyer pursuant to all claims
for indemnification for breaches of representations and/or warranties under Section 7.2(a), shall not exceed, in each case,
Four Million Dollars ($4,000,000.00) (the “Cap”). For the avoidance of doubt, the Cap shall not apply to either
Party’s indemnity obligations under Section 7.1(b), Section 7.1(c), Section 7.1(d), Section 7.2(b),
or Section 7.2(c).


 


Section
7.4            Survival of Representations and Warranties. Except for the Fundamental Representations (which shall survive and remain
in full force and effect at all times after the Effective Date), the representations and warranties set forth in Article 4
and Article 5 shall survive and remain in full force and effect until the date that is twenty-four (24) months after
the Effective Date.


 


Section
7.5            Sole Remedy. Except in the event of fraud, the Parties acknowledge and agree that their sole and exclusive remedy with
respect to any and all claims with respect to breaches of any representation or warranty stated in Article 4 or Article
5 shall be pursuant to the rights to indemnification set forth in this Article 7.


 


Section
7.6            Indemnity Procedures.


 


(a)           In
order for an indemnified party under this Article 7 (an “Indemnified Party”) to be entitled to any indemnification
provided for under this Agreement, the Indemnified Party will, within a reasonable period of time following the discovery of the
matters giving rise to any Losses, notify its applicable insurer and the indemnifying party under this Article 7 (the “Indemnifying
Party”) in writing of its claim for indemnification for such Losses, specifying in reasonable detail the nature of the
Losses and the amount of the liability estimated to accrue therefrom; provided, however, that failure to give notification
will not affect the indemnification provided hereunder, except to the extent the Indemnifying Party will have been actually prejudiced
as a result of the failure. Thereafter, the Indemnified Party will deliver to the Indemnifying Party, within a reasonable period
of time after the Indemnified Party’s receipt of such request, all information, records and documentation reasonably requested
by the Indemnifying Party with respect to such Losses. The Indemnifying Party shall control all litigation reflecting to the indemnification.
Without limiting the foregoing, the Indemnified Party shall control choice of counsel, staffing, and all decisions to be made
with the litigation.


 


(b)           If
the indemnification sought pursuant hereto involves a claim made by a Third Party against the Indemnified Party (a “Third
Party Claim”), the Indemnifying Party will be entitled to participate in the defense of such Third Party Claim and,
if it so chooses, to assume the defense of such Third Party Claim with counsel selected by the Indemnifying Party. Should the
Indemnifying Party so elect to assume the defense of a Third Party Claim, the Indemnifying Party will not be liable to the Indemnified
Party for any legal expenses subsequently incurred by the Indemnified Party in connection with the defense thereof. If the Indemnifying
Party assumes such defense, the Indemnifying Party will control such defense. The Indemnifying Party will be liable for the reasonable
fees and expenses of counsel employed by the Indemnified Party for any period during which the Indemnifying Party has not assumed
the defense thereof (other than during any period in which the Indemnified Party will have failed to give notice of the Third
Party Claim as provided above). If the Indemnifying Party chooses to defend or prosecute a Third Party Claim, all of the parties
hereto will cooperate in the defense or prosecution thereof. Such cooperation will include the retention and (upon the Indemnifying
Party’s request) the provision to the Indemnifying Party of records and information, which are reasonably relevant to such
Third Party Claim, and making employees available on a mutually convenient basis to provide additional information and explanation
of any material provided hereunder. If the indemnifying Party chooses to defend or prosecute any Third Party Claim, the Indemnifying
Party will seek the approval of the Indemnified Party (not to be unreasonably withheld) to any settlement, compromise or discharge
of such Third Party Claim the Indemnifying Party may recommend and which by its terms obligates the Indemnifying Party to pay
the full amount of the liability in connection with such Third Party Claim. Whether or not the Indemnifying Party will have assumed
the defense of a Third Party Claim, the Indemnified Party will not admit any liability with respect to, or settle, compromise
or discharge, such Third Party Claim without the Indemnifying Party’s prior written consent). The Indemnifying Party shall
reimburse upon demand, all reasonable costs and expenses incurred by the Indemnified Party in cooperation with the defense or
prosecution of the Third Party Claim.


 






     -11-


     


    

 


Section
7.7            Holdback. Notwithstanding anything herein to the contrary, in addition to any other rights available to any Buyer Indemnified
Party under this Agreement or otherwise: (a) Buyer, in its sole discretion, may forever retain all or such portion of the Consideration
equal in value to the amount of any indemnification obligations owed by Seller pursuant to this Article 7, as and when
the Buyer Indemnified Party incurs or suffers a Loss and (b) in the event that Buyer exercises its right to retain all or any
portion of the Consideration, Seller shall remain liable for any unsatisfied indemnification obligations under this Article
7.


 


ARTICLE
8

GENERAL PROVISIONS


 


Section
8.1            Expenses. Except as otherwise specified in this Agreement, all costs and expenses, including fees and disbursements
of counsel, financial advisors and accountants, incurred in connection with this Agreement and the transactions contemplated hereby
will be paid by the Party incurring such costs and expenses.


 


Section
8.2            Notices. All notices and other communications required or permitted to be given or made pursuant to this Agreement
shall be in writing signed by the sender and shall be deemed duly given: (a) on the date delivered, if personally delivered, (b)
on the date sent by facsimile with automatic confirmation by the transmitting machine showing the proper number of pages were
transmitted without error, (c) on the Business Day after being sent by Federal Express or another recognized overnight mail service
which utilizes a written form of receipt for next day or next business day delivery, or (d) upon receipt after mailing, if mailed
by United States postage-prepaid certified or registered mail, return receipt requested, in each case addressed to the applicable
party at the address set forth below; provided that a Party may change its address for receiving notice by the proper giving of
notice hereunder:


 


if
to Buyer, to:


 


Tonix
Pharmaceuticals, Inc.


509
Madison Avenue, Suite 306


New
York, NY 10022


Attention:
Seth Lederman, M.D.


   Chief
Executive Officer


 






     -12-


     


    

 


with
a copy to:


 


Lowenstein
Sandler LLP

One Lowenstein Drive

Roseland, New Jersey 07068

Facsimile: (973) 597-2400


Attn:
Michael J. Lerner, Esq.


 


if
Seller, to:


 


TRImaran
Pharma, Inc.


115
Hawthorne Village Rd.


Nashua,
NH 03062


Attention:
Walter Piskorski


 


with
a copy to:


 


Frank
Bymaster


8545
N. County Rd. 650 E


Brownsburg,
IN 46112


 


Section
8.3            Headings. The table of contents and headings contained in this Agreement are for reference purposes only and will not
affect in any way the meaning or interpretation of this Agreement.


 


Section
8.4            Severability. If any term or other provision of this Agreement is invalid, illegal or incapable of being enforced under
any law or public policy, all other terms and provisions of this Agreement will nevertheless remain in full force and effect so
long as the economic or legal substance of the transactions contemplated hereby is not affected in any manner materially adverse
to any Party. Upon such determination that any term or other provision is invalid, illegal or incapable of being enforced, the
Parties will negotiate in good faith to modify this Agreement so as to effect the original intent of the Parties as closely as
possible in an acceptable manner in order to ensure that the transactions contemplated hereby are consummated as originally contemplated
to the greatest extent possible.


 


Section
8.5            Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed an original,
and all of which together shall constitute one and the same instrument. Signatures provided by facsimile transmission or in Adobe
Portable Document Format (PDF) sent by electronic mail shall be deemed to be original signatures.


 


Section
8.6            Entire Agreement; No Third Party Beneficiaries. This Agreement constitutes the entire agreement and supersede all prior
agreements and understandings both written and oral (including any letter of intent, memorandum of understanding electronic communicators,
e-mail or term sheet), between the Parties with respect to the subject matter hereof. Except as specifically provided herein,
this Agreements is not intended to confer upon any Person other than the Parties any rights or remedies hereunder.


 


Section
8.7            Governing Law. This Agreement and all matters arising directly or indirectly herefrom shall be governed by and construed
and enforced in accordance with the laws of the State of New York applicable to agreements made and to be performed entirely in
such state, without giving effect to the conflict of law principles thereof.


 






     -13-


     


    

 


Section
8.8            Jurisdiction; Venue, Service of Process. Buyer and Seller each agrees to irrevocably submit to the sole and exclusive
jurisdiction of the state and federal courts located in New York County, New York for any suit, action or other proceeding arising
out of this Agreement or any transaction contemplated hereby, and hereby waives any objection to the laying of venue in such courts.
Each Party agrees that service of any process, summons, notice or document by U.S. registered mail or recognized international
courier service to such Party’s address set forth in this Agreement shall be effective service of process.


 


Section
8.9            Publicity. Neither Party will make any public announcement concerning, or otherwise publicly disclose, any information
with respect to the transactions contemplated by this Agreement or any of the terms and conditions hereof without the prior written
consent of the other Party. Notwithstanding the foregoing (a) either Party may make any public disclosure concerning the transactions
contemplated hereby that in the opinion of such Party’s counsel may be required by any Government Rule or the rules of any
stock exchange on which such Party’s or any of its Affiliates’ securities trade and (b) Buyer may publicize its development
of the Compounds, the Technology and/or any resulting Products without approval from Seller.


 


Section
8.10          Assignment. Neither Party may assign its rights or obligations under this Agreement without the prior, written consent
of the other Party; provided, however, that notwithstanding the foregoing, either Party may assign its rights and
obligations under this Agreement, without any obligation to obtain the other Party’s consent, to (i) any of its Affiliates
or (ii) in connection with any merger, consolidation, sale of all or substantially all of the assets of such Party (or, in the
case of Buyer, Buyer’s business related to the Product) or any similar transaction. Any permitted assignee or successor-in-interest
will assume all obligations of its assignor under this Agreement. No assignment will relieve either Party of its responsibility
for the performance of any obligation. This Agreement will be binding upon and inure to the benefit of the Parties hereto and
their respective successors and permitted assigns.


 


Section
8.11          Amendments and Waivers. This Agreement may not be amended except by an instrument in writing signed by both Parties.
Each Party may, by a signed written instrument, waive compliance by the other Party with any term or provision of this Agreement
that such other Party was obligated to comply with or perform.


 


[Remainder
of Page Intentionally Left Blank- Signature Page to Follow]


 




     -14-


     


    

 


IN
WITNESS WHEREOF, the Parties have caused this Agreement to be signed by their respective representatives thereunto duly authorized,
all as of the date first written above.


 


	 	TONIX PHARMACEUTICALS, INC.	TRIMARAN PHARMA, INC.
	 	 	 	 	 	 	 
	 	By: 	/s/ Seth Lederman	By: 	/s/ Walter Piskorski
	 	 	 	 	 	 	 
	 	Name: 	Seth Lederman, M.D.	Name: 	Walter Piskorski
	 	 	 	 	 	 	 
	 	Title: 	Chief Executive Officer	Title: 	Pres. & CEO







 





Seller
Shareholders

(solely for the purposes of Section 3.1(b), Section 6.1, Section 6.2 and Exhibit F):


 





	By:	/s/ Walter Piskorski	 



 


Name:
Walter Piskorski


 


	By:	/s/ Frank Bymaster	 





 


Name:
Frank Bymaster


 





	By:	/s/ Timothy Hsu	 


 


Name:
Timothy Hsu, M.D.


 





	By:	/s/ Aloke Dutta	 








 


Name:
Aloke Dutta, Ph.D.





[signature
page to Asset Purchase Agreement]


 




     


     


    

 


EXHIBIT
A

Certain Assumed Liabilities


 


Final
accounting and distribution for the following may be changed by mutual agreement of the Parties.


 


	[***]	$[***]
	[***]	$[***]
	[***]	$[***]
    
	[***]	$[***]
    
	[***]	$[***]
    
	[***]	$[***]
	 Total	$[***]
    


 


Note
1: Expense reimbursements cover various expenses such as GoDaddy web hosting, email account hosting, franchise tax payments. With
regard to the expense reimbursement for [***], $[***]is for a license fee payment to WSU, and the remainder is for travel expenses,
meeting registration fees, attendance expenses and other associated expenses.


 


Note
2: Expense reimbursements are not income and should not generate a Form1099.


 


Note
3: With regard to the expenses reimbursements for [***], Buyer may issue one payment to [***]who will then pay [***].


 




     


     


    

 


EXHIBIT
B

Certain Compounds


 


[***]


 




     


     


    

 


EXHIBIT
C

Certain Patent Rights


 





	Application
    Type / Country	Serial
    No	Filing
    Date	Title	Patent
    Number	Issue
    Date	Status
	[***]	[***]	[***]	[***]	[***]	[***]	[***]
	[***]	[***]	[***]	[***]	[***]	[***]	[***]
	[***]	[***]	[***]	[***]	[***]	[***]	[***]
	[***]	[***]	[***]	[***]	[***]	[***]	[***]
	[***]	[***]	[***]	[***]	[***]	[***]	[***]
	[***]	[***]	[***]	[***]	[***]	[***]	[***]
	[***]	[***]	[***]	[***]	[***]	[***]	[***]
	[***]	[***]	[***]	[***]	[***]	[***]	[***]


 







     


     


    

  


EXHIBIT
D

Certain Transferred Contracts


 


None.
Other than the License with Wayne State Univ., TRImaran has not executed any other contracts.


 






     


     


    

 





EXHIBIT
E


Distribution
of Consideration


 


[***]



 



     


     


    




 


EXHIBIT
F

Form of Lock-Up Agreement


 


Lock-Up
Agreement


 


August
__, 2019


 


Tonix
Pharmaceuticals Holding Corp.


509
Madison Avenue, Suite 1608


New
York, New York 10022


 


Ladies
and Gentlemen:


 


The
undersigned understands that TRImaran Pharma, Inc. (“TRImaran”), a Delaware corporation, propose to enter into
an Asset Purchase Agreement (the “Agreement”) with Tonix Pharmaceuticals, Inc. (“TPI”),
a Delaware corporation and wholly owned subsidiary of Tonix Pharmaceuticals Holding Corp., a Nevada corporation (the “Company”),
providing for, at TPI’s option upon occurrence of certain milestones as set forth in the Agreement (each, a “Milestone”),
the issuance of shares of common stock, par value $0.001 per share, of the Company (the “Common Shares”). Capitalized
terms used herein and not otherwise defined shall have the meanings set forth in the Agreement.


 


To
induce TPI to enter into the Agreement, the undersigned hereby agrees that, without the prior written consent of the Company,
the undersigned will not, during the period commencing on the date hereof and ending six (6) months after the date on which any
Common Shares are issued to the undersigned with respect to a given Milestone (the “Lock-Up Period”), (1) offer,
pledge, sell, contract to sell, grant, lend, or otherwise transfer or dispose of, directly or indirectly, any Common Shares issued
with respect to that Milestone or any securities convertible into or exercisable or exchangeable for such Common Shares, whether
now owned or hereafter acquired by the undersigned or with respect to which the undersigned has or hereafter acquires the power
of disposition (collectively, the “Lock-Up Securities”); (2) enter into any swap or other arrangement that
transfers to another, in whole or in part, any of the economic consequences of ownership of the Lock-Up Securities, whether any
such transaction described in clause (1) or (2) above is to be settled by delivery of Lock-Up Securities, in cash or otherwise;
or (3) publicly disclose the intention to make any offer, sale, pledge or disposition, or to enter into any transaction, swap,
hedge or other arrangement relating to any Lock-Up Securities. The undersigned also agrees and consents to the entry of stop transfer
instructions with the Company’s transfer agent and registrar against the transfer of the undersigned’s Lock-Up Securities
except in compliance with this lock-up agreement.


 


The
undersigned understands that the Company and TPI are relying upon this lock-up agreement in proceeding toward execution of the
Agreement. The undersigned further understands that this lock-up agreement is irrevocable and shall be binding upon the undersigned’s
heirs, legal representatives, successors and assigns.


 


[Remainder
of Page Intentionally Blank]


 







     


     


    




 


	 	Very truly yours,
	 	 
	 	(Name
    - Please Print)
	 	 
	 	(Signature)
	 	 
	 	(Name
    of Signatory, in the case of entities - Please Print)
	 	 
	 	(Title
    of Signatory, in the case of entities - Please Print)



 


	 	Address:	 	 
	 		 	 
	 	 	 	 


 


[signature
page to Lock-Up Agreement]