Tonix Pharmaceuticals Holding Corp. 10-K


 


Exhibit 10.17


 



SECOND AMENDMENT OF LEASE
AND ASSIGNMENT OF LEASE


 


SECOND
AMENDMENT OF LEASE AND ASSIGNMENT OF LEASE (this “Amendment”) made as of the  6 day of December, 2018 (the
“Effective Date”), by and between 509 MADISON AVENUE ASSOCIATES, LP, a New York limited partnership,
having an office c/o Kensico Management, Inc., 509 Madison Avenue, New York, New York 10022 (“Landlord”), TONIX
PHARMACEUTICALS, INC., a Delaware corporation having an office at 509 Madison Avenue, Suite 306, New York, New York 10022
(“Assignor”), and TONIX PHARMACEUTICALS HOLDINGS CORP., a Nevada corporation having an office at 509
Madison Avenue, Suite 306, New York, New York 10022 (“Tenant”).


W I T N E S S E T H:


WHEREAS,
by Agreement of Lease dated (the “Original Lease”) as of September 28, 2010, Landlord did demise and let unto Tenant
and Tenant did hire and take space on the third floor (also known as Suite 306) as more particularly identified in the Original
Lease in the building known by the street address 509 Madison Avenue, New York, New York (the “Building”);


WHEREAS,
Landlord and Tenant entered into that certain Lease Amendment and Expansion Agreement dated as of February 11, 2014 (the “First
Amendment”) pursuant to which Tenant also hired and took space on the third floor (known as Suite 310) (Suite 306 and Suite
310 shall collectively be referred to herein as “(the “Original Demised Premises”);


WHEREAS,
Landlord and Tenant desires to modify the Original Lease to (i) extend the term of the Original Lease, (ii) substitute for
the Original Demised Premises other space in the Building located on the sixteenth (16th) floor, being more particularly
shown on Exhibit A annexed hereto (and also known as Suite 1608) (the “New Demised Premises”), and (iii) surrender
to Landlord the Original Demised Premises and to modify the Original Lease in connection therewith, all as hereinafter set forth
(the Original Lease, as modified by the First Amendment and this Amendment, the “Lease”).


NOW, THEREFORE,
in consideration of the mutual covenants herein contained, and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, Landlord and Tenant agree as follows:


1.       


Lease of
New Demised Premises. Commencing on the later to occur of (i) January 15, 2019 or (ii) the day after Landlord delivers written
notice to Tenant of the substantial completion of Landlord’s Work (as defined in Section 3(B) hereof) (the “Extended
Term Commencement Date”), Landlord hereby leases to Tenant and Tenant hereby leases from Landlord the New Demised Premises
upon all of the terms and conditions of the Original Lease, except as follows:


(A)       


The term of
the Lease is extended through and including the last day of the twenty second (22nd) full month following the Extended
Term Commencement Date, or on such earlier date upon which said term may be terminated pursuant to any other conditions in the
Lease or pursuant to law, upon all of the terms, covenants and conditions contained in the Lease, except as otherwise expressly
set forth in this Amendment (the “Extended Term Expiration Date”);


(B)       


The “demised
premises” shall mean the New Demised Premises; provided, however, that from the Extended Term Commencement
Date until the Surrender Date (as defined in Section 4 hereof), the demised premises shall be deemed to include both the Original
Demised Premises and the New Demised Premises, subject to the terms herein;




    	 



    	 



    

 


(C)       


The annual
Base Rent for the New Demised Premises, payable in equal monthly installments (including the Electrical Inclusion Factor), shall
be as follows:


		a.	$195,363.00 per annum for
the period commencing on the Extended Term Commencement Date and ending on the day immediately preceding the first anniversary
of the Extended Term Commencement Date;






		b.	$200,944.80 per annum for
the period commencing on the first anniversary of the Extended Term Commencement Date and ending on the Extended Term Expiration
Date.






(D)       


“Base
Tax Year” as defined in Article 43(A)(2) of the Original Lease shall mean the real estate taxes payable with respect to the
Building for the New York City fiscal year beginning on July 1, 2018 and ending on June 30, 2019;


(E)       


“Tenant’s
Percentage” as defined in Article 43(A)(4) of the Original lease (as amended by Section 4(B) of the First Amendment) shall
mean 1.84%;


(F)       


The “Electrical
Inclusion Factor” as defined in Article 46(2) and (5) of the Original Lease (as amended by Section 4(C) of the First Amendment)
shall be “NINE THOUSAND THREE HUNDRED AND THREE DOLLARS AND 00/100 ($9,303.00)”; and


(G)       


The rentable
square footage for the New Demised Premises for purposes of Article 46(C)(6) only (as amended by Section 4(D) of the First Amendment)
shall be 2,658 square feet.


2.       


Original
Demised Premises. Landlord and Tenant hereby acknowledge and agree that Tenant shall continue leasing the Original Demised
Premises until the Surrender Date (as defined in Section 4 hereof) (the “Original Demised Premises Term”). During the
Original Demised Premises Term, and subject to Section 4(B) hereof, Tenant shall lease the Original Demised Premises upon all of
the terms and conditions of the Original Lease, as modified by this Amendment, including, without limitation, the continued payment
of Base Rent and additional rent with respect to the Original Demised Premises.


3.       


Condition
of New Demised Premises. (A) Tenant covenants and agrees that it shall accept the New Demised Premises in its condition “AS
IS” as of the Effective Date, subject to any and all defects therein but subject to Landlord’s repair and maintenance
obligations as explicitly set forth in the Lease, and that Landlord shall have no obligation to do any work or make any installation,
repair or alteration of any kind to or in respect of the New Demised Premises other than using Building standard materials to perform
the work described on Exhibit B annexed hereto (“Landlord’s Work”).


(B)        For
purposes of this Section 3, “substantial completion” of Landlord’s Work shall mean Landlord’s Work then
remaining to be done, if any, shall have reached that stage of completion such that Tenant could use and occupy the New Demised
Premises and operate its business therein without substantial interference by reason of those items still required to be done to
complete Landlord’s Work. In any event, Tenant will at all times cooperate with Landlord so as not to impede Landlord’s
ability to complete Landlord’s Work as expeditiously as possible. Additionally, Tenant understands and confirms that Landlord’s
Work shall be deemed substantially completed even though certain details, adjustments or other matters which do not materially
impede Tenant’s access to the New Demised Premises and use thereof for the conduct of Tenant’s business remain to be
completed (collectively, “Punch List Items”). Landlord shall complete all Punch List Items within thirty (30) days
of substantial completion of Landlord’s Work. In the event that any requests for changes and/or additions in Landlord’s
Work are made by Tenant and approved by Landlord, and such requests extend the estimated time for substantial completion of Landlord’s
Work, such estimate to be reasonably determined by Landlord or Landlord’s contractors or subcontractors hired to perform
said required work, then, for the purposes hereof, Landlord’s Work shall be deemed to have been substantially completed except
for the delay caused by or in any manner related to the requests of Tenant made as aforesaid. Nothing in the preceding sentence
shall be construed as requiring Landlord to grant, approve or comply with any such requests for changes and/or additions.




    	 



    	 



    

 


(C)       


Landlord
shall cause substantial completion of Landlord’s Work to occur by no later than
January 30, 2019 (the “Intended Completion Date”) which date shall be further delayed on a day-for-day basis for each
day of any Tenant Delay (as hereinafter defined) or delays caused by force majeure or other events beyond Landlord’s reasonable
control. If for any reason substantial completion does not occur by the Intended Completion Date, then Base Rent with respect
to the Original Demised Premises shall be abated during the period commencing on the Intended Completion Date and ending on the
date upon which Landlord causes substantial completion to occur. A “Tenant Delay” will be deemed to have occurred
if the completion of Landlord’s Work is delayed due to any act or omission by Tenant (or Tenant’s agents, servants,
employees, subtenants, contractors, invitees, licensees and all other persons invited by Tenant into the New Demised Premises
as guests or doing lawful business with Tenant), including, but not limited to, delays due to changes in or additions to Landlord’s
Work requested by Tenant, delays in submission of information or estimates, delays in giving authorizations or approvals, or delays
due to the postponement of any work at the request of Tenant.


4.       


Surrender
of Original Demised Premises.


(A)       


On the later
to occur of (i) the Extended Term Commencement Date, and (ii) the date upon which Tenant shall remove all of Tenant's movable personal
property and movable trade fixtures from the Original Demised Premises and vacate same and deliver vacant possession thereof to
Landlord (such date, as applicable, the “Surrender Date”), Tenant shall surrender possession of the Original Demised
Premises to Landlord and Tenant shall give, grant and surrender all of its right, title and interest to the Original Demised Premises
to Landlord. Tenant covenants and agrees on behalf of itself, its successors and assigns, that it has not done or suffered (and
will not do or suffer) anything whereby the Original Demised Space has (or will) become encumbered in any way whatsoever. Through
and including the Surrender Date, Tenant shall continue to pay Landlord any and all payments, sums or charges due or to become
due relating to the Original Demised Premises pursuant to the terms of the Original Lease. On or before the Surrender Date, Tenant
shall deliver the Original Demised Premises to Landlord broom clean, in good order and condition, except wear and tear, and otherwise
in the condition required under the Lease. Tenant shall deliver the Original Demised Premises to Landlord broom clean, in good
order and condition Effective as of the Surrender Date (and provided Tenant delivers possession of the Original Demised Premises
to Landlord in the condition required by the Original Lease), (i) all references to the “demised premises” in the Original
Lease shall mean the New Demised Premises and (ii) Tenant shall have no further obligation to Landlord under the Original Lease
(or any amendment thereto) with respect to the Original Demised Premises except with respect to obligations that survive the termination
of the Lease.


(B)       


If Tenant
shall fail to surrender possession of the Original Demised Premises to Landlord by the date which is thirty (30) days after the
Extended Term Commencement Date, then Tenant shall be deemed to be a holdover in respect thereof and shall be subject to all of
Landlord's rights and remedies set forth in the Original Lease and this Amendment by reason of such holdover. Notwithstanding anything
to the contrary contained herein, in the event of a holdover hereunder, Tenant shall be required to pay Landlord holdover rent
for the Original Demised Premises as required under Article 52 of the Original Lease for each month (or portion thereof) during
which Tenant holds over in the Original Demised Premises after the Outside Surrender Date, in addition to any Base Rent and additional
rent for the New Demised Premises required hereunder.


5.       


Broker.
Landlord and Tenant each represent and warrant that it has dealt with no broker in connection with this Agreement other than Circle
Group Realty LLC (the “Broker”) each agree to indemnify and hold the other party harmless from any and all loss, costs,
damage or expense (including, without limitation, reasonable attorneys’ fees and disbursements) incurred by the other party
by reason of any claim or liability to any broker, finder or like agent other than Broker, who shall claim to have dealt with the
indemnifying party in connection with this Agreement. This Section shall survive the expiration or earlier termination of the Lease
and this Amendment.


6.       


Assignment
and Assumption of Lease.


(A)       


Assignor hereby
assigns, sells, and transfers to and for the exclusive benefit of Tenant, all right, title, interest, claim and demand of Assignor
in and to the Lease, including, without limitation, the security deposit. Tenant hereby accepts the foregoing assignment and assumes
and agrees to pay, perform, discharge and otherwise be and remain responsible for all covenants, obligations, and liabilities of
Assignor as tenant under the Lease.






    	 



    	 



    

(B)       


Landlord hereby
grants its consent (the “Consent”) to the assignment by Assignor to Assignee, subject to the following terms and conditions:


 i.




Nothing herein contained
shall be construed to modify, waive, impair or affect any of the provisions, covenants, agreements, terms or conditions in
the Lease, or to waive any breach thereof, or any right of Landlord against any person, firm, association or corporation
liable or responsible for the performance thereof, or to enlarge or increase Landlord’s obligations under the Lease,
and all provisions, covenants, agreements, terms and conditions of the Lease are hereby mutually declared to be in full force
and effect.


 ii.




This Consent shall not be
assignable and shall not be construed as a consent by Landlord to, or as permitting, any other assignment of the Lease
without Landlord’s prior written consent.


 iii.




Tenant and
Assignee covenant and agree to indemnify and hold Landlord harmless against any and all claims (including, without
limitation, reasonable attorneys’ fees and disbursements) for brokerage commissions in connection with the Assignment
and/or this Consent.


 iv.




Assignee
shall not use or permit the use of the demised premises or any part thereof in any way which might or would violate any of
the provisions, covenants, agreements, terms and conditions of the Lease, or for any unlawful purposes or in any unlawful
manner and Assignee shall not suffer or permit anything to be done therein or suffer or permit anything to be brought into or
kept in the premises which, in the judgment of Landlord, might or shall in any way reasonably impair or tend to impair the
character, appearance or reputation of the Building, impair or interfere with or tend to impair or interfere with any of the
Building services or the proper and economic heating, cleaning, air conditioning or other servicing of the Building or the
demised premises or impair or interfere with or tend to impair or interfere with the use of any of the other areas of the
Building by, or occasion discomfort, inconvenience or annoyance to, any of the other tenants of the Building. Assignee shall
not install or permit to be installed in the demised premises or any part thereof any electrical or other similar or
dissimilar equipment of any kind which, in the judgment of Landlord, might cause any such impairment, interference,
discomfort, inconvenience or annoyance.


 v.




Assignor
shall be and remain liable and responsible for the due keeping, performance and observance of all the provisions, covenants,
agreements, terms and conditions set forth in the Lease on the part of the tenant under the Lease to be kept, performed and
observed and for the payment of the rent, additional rent and all other sums now and/or hereafter becoming payable
thereunder, expressly including as such (but not limited to) additional rent, adjustments of rent, and any and all charges
for any property, material, labor, utility or other similar or dissimilar services rendered or supplied or furnished by
Landlord in, or in connection with, the demised premises under the Lease.


7.       


Miscellaneous.


(A)       


As modified
and amended by this Agreement, all of the terms, covenants and conditions of the Lease are hereby ratified and confirmed and shall
continue to be and remain in full force and effect throughout the remainder of the term thereof.


(B)       


Unless otherwise
set forth herein, capitalized terms shall have the meanings set forth in the Lease.


(C)       


This Amendment
may be executed in one or more counterparts, each of which shall be deemed an original, but all of which when taken together shall
constitute one and the same instrument.


[Signature Page Follows]




    	 



    	 



    

 


IN WITNESS WHEREOF, the parties
hereto have caused this Amendment to be executed as of the day and year first above written.


 


 


	 	LANDLORD:
	 	 
	 	509
    MADISON AVENUE ASSOCIATES, LP
	 	 
	 	 
	 	 
	 	 
	 	By:	/s/
    Marilyn Cafone
	 	 	Name: Marilyn Cafone
	 	 	Title: Corporate Controller
	 	 
	 	 
	 	 
	 	ASSIGNOR:
	 	 
	 	TONIX
    PHARMACEUTICALS, INC.
	 	 
	 	 
	 	 
	 	By:	/s/
    Seth Lederman
	 	 	Name: Seth Lederman
	 	 	Title: CEO
	 	 
	 	 
	 	 
	 	TENANT:
	 	 
	 	TONIX
    PHARMACEUTICALS HOLDINGS CORP.
	 	 
	 	 
	 	 
	 	By:	/s/
    Jessica Morris
	 	 	Name: Jessica Morris
	 	 	Title: COO


 




    	 



    	 



    

 


 


EXHIBIT A


 


New Demised Premises


 


 


 









    	 



    	 



    

EXHIBIT B


 


Landlord’s Work


Suite 1608


 


		1.	Install Floor Power and Data Outlet in location to be specified by Tenant. Power outlet to be 115V/15A separate branch circuit.
Data cabling excluded.



 


		2.	Paint entire office, except office fronts and doors, Chantilly Lace (off white).



 


		3.	Carpet entire area with building standard nylon, 20 oz. broadloom carpet. Carpet to be double adhesive installation with rubber
cushion. Carpet choice made by Tenant from building standard selection.



 


		4.	Replace wooden entry door.