Document:

EX-10.5

  Exhibit 10.5

  SECOND AMENDMENT TO OFFICE LEASE

  This SECOND AMENDMENT TO OFFICE LEASE ("Second Amendment") is made and entered into as of September 1, 2021, by and between HCP LIFE SCIENCE REIT, INC., a Maryland corporation ("Landlord"), and SORRENTO THERAPEUTICS, INC., a Delaware corporation ("Tenant").

  R E C I T A L S :

  A.Landlord (incorrectly listed in the Lease as HCP LIFE SCIENCE ESTATES, INC., a Delaware corporation) and Tenant are parties to the Lease dated November 13, 2018 (the "Original Lease"), as amended by that certain First Amendment to Office Lease dated October 10, 2020 (the "First Amendment", and collectively with the Original Lease, the "Lease"), pursuant to which Tenant leases approximately 61,207 rentable square feet of space, consisting of the entire building (the "Building") located at 4939 Directors Place, San Diego, California 92121.

  B.Concurrently with the execution of this Second Amendment, Landlord and Tenant are also entering into a Lease for premises located at 4930 Directors Place, San Diego, California (the "4930 Lease").

  C.The parties desire to amend the Lease on the terms and conditions set forth in this Second Amendment.

  A G R E E M E N T :

  NOW, THEREFORE, in consideration of the foregoing recitals and the mutual covenants contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows:

  1.Terms.  All capitalized terms when used herein shall have the same respective meanings as are given such terms in the Lease unless expressly provided otherwise in this Second Amendment.

  2.Condition of the Premises.  Landlord and Tenant acknowledge that Tenant has been occupying the Premises pursuant to the Lease, and therefore, subject to the terms of the Lease, Tenant continues to accept the Premises in its presently existing, "as is" condition.  Except as otherwise set forth in the Lease, Landlord shall not be obligated to provide or pay for any improvement work or services related to the improvement of the Premises.  Tenant also acknowledges that neither Landlord nor any agent of Landlord has made any representation or warranty regarding the condition of the Premises, the Building, or the Project or with respect to the suitability of the same for the conduct of Tenant's business.

   

   

  

  3.Extended Lease Term.  Pursuant to the Lease, the Lease Term is scheduled to expire on October 31, 2029.  Landlord and Tenant hereby agree to extend the Lease Term for the Lease to be coterminous with the 4930 Lease (i.e., the Lease Term shall expire on the "Lease Expiration Date," as that term is defined in the 4930 Lease), on the terms and conditions set forth in the Lease, as hereby amended by this Second Amendment, unless sooner terminated as provided in the Lease.  The period commencing on November 1, 2029 (the "Second Amendment Extended Term Commencement Date") and ending on the Lease Expiration Date for the 4930 Lease shall be referred to herein as the "Second Amendment Extended Term".

  3.1Option to Extend Lease Term.  Landlord and Tenant acknowledge and agree that Tenant shall continue to have one (1) option to extend the Lease Term (as extended by the Second Amendment Extended Term) for a period of five (5) years in accordance with, and pursuant to the terms of, Section 2.2 of the Original Lease; provided, however, all references therein to the "initial Lease Term" shall be deemed to refer to the "Second Amendment Extended Term", and the phrase "(i.e., November 1, 2029 - October 31, 2030)" in Section 2.2.2 of the Original Lease shall be deleted in its entirety.

  4.Rent.  The annual Rent payable by Tenant during the Second Amendment Extended Term (the "Second Amendment Extended Rent") shall be equal to the "Fair Rental Value," as that term is defined in Section 2.2.2 of the Original Lease, and shall be determined pursuant to Section 2.2.3 of the Original Lease, provided that all references therein to the "Option Rent" shall be deemed to refer to the "Second Amendment Extended Rent" and all references therein to the "Option Term" shall be deemed to refer to the "Second Amendment Extended Term". For the avoidance of doubt, on each anniversary of the Second Amendment Extended Term Commencement Date, the monthly installments Base Rent payable by Tenant shall increase by three percent (3%) of the monthly installments Base Rent for the preceding twelve (12) month period, as further set forth in Section 2.2.2 of the Original Lease.

  5.Brokers.  Landlord and Tenant hereby warrant to each other that they have had no dealings with any real estate broker or agent in connection with the negotiation of this Second Amendment other than CBRE, Inc. and Kidder Mathews (the "Brokers"), and that they know of no other real estate broker or agent who is entitled to a commission in connection with this Second Amendment.  Each party agrees to indemnify and defend the other party against and hold the other party harmless from any and all claims, demands, losses, liabilities, lawsuits, judgments, costs and expenses (including without limitation reasonable attorneys' fees) with respect to any leasing commission or equivalent compensation alleged to be owing on account of any dealings with any real estate broker or agent, other than the Brokers, occurring by, through, or under the indemnifying party.  The terms of this Section 5 shall survive the expiration or earlier termination of the term of the Lease, as hereby amended.

  6.Governing Law; JUDICIAL REFERENCE.  Notwithstanding anything to the contrary in the Lease, the Lease, as amended, shall be construed and enforced in accordance with the laws of the State of California.  If the jury waiver provisions of this Section 6 are not enforceable under California law, then the following provisions shall apply.  It is the desire and 

   

  			
	 
	-2-
	HCP, INC.
[Second Amendment]
[Sorrento Therapeutics, Inc.]

   

   

   

  

  intention of the parties to agree upon a mechanism and procedure under which controversies and disputes arising out of the Lease, as amended, or related to the Premises will be resolved in a prompt and expeditious manner.  Accordingly, except with respect to actions for unlawful or forcible detainer or with respect to the prejudgment remedy of attachment, any action, proceeding or counterclaim brought by either party hereto against the other (and/or against its officers, directors, employees, agents or subsidiaries or affiliated entities) on any matters whatsoever arising out of or in any way connected with the Lease, as amended, Tenant's use or occupancy of the Premises and/or any claim of injury or damage, whether sounding in contract, tort, or otherwise, shall be heard and resolved by a referee under the provisions of the California Code of Civil Procedure, Sections 638 — 645.1, inclusive (as same may be amended, or any successor statute(s) thereto) (the "Referee Sections").  Any fee to initiate the judicial reference proceedings and all fees charged and costs incurred by the referee shall be paid by the party initiating such procedure (except that if a reporter is requested by either party, then a reporter shall be present at all proceedings where requested and the fees of such reporter - except for copies ordered by the other parties - shall be borne by the party requesting the reporter); provided however, that allocation of the costs and fees, including any initiation fee, of such proceeding shall be ultimately determined in accordance with Section 29.21 above.  The venue of the proceedings shall be in the county in which the Premises are located. Within ten (10) days of receipt by any party of a written request to resolve any dispute or controversy pursuant to this Section 6, the parties shall agree upon a single referee who shall try all issues, whether of fact or law, and report a finding and judgment on such issues as required by the referee sections. If the parties are unable to agree upon a referee within such ten (10) day period, then any party may thereafter file a lawsuit in the county in which the Premises are located for the purpose of appointment of a referee under the referee sections. If the referee is appointed by the court, the referee shall be a neutral and impartial retired judge with substantial experience in the relevant matters to be determined, from JAMS, the American Arbitration Association or similar mediation/arbitration entity. The proposed referee may be challenged by any party for any of the grounds listed in the referee sections. The referee shall have the power to decide all issues of fact and law and report his or her decision on such issues, and to issue all recognized remedies available at law or in equity for any cause of action that is before the referee, including an award of attorneys' fees and costs in accordance with the Lease, as amended. The referee shall not, however, have the power to award punitive damages, nor any other damages which are prohibited by the express provisions of the Lease, as amended, and the parties hereby waive any right to recover any such damages. The parties shall be entitled to conduct all discovery as provided in the California Code of Civil Procedure, and the referee shall oversee discovery and may enforce all discovery orders in the same manner as any trial court judge, with rights to regulate discovery and to issue and enforce subpoenas, protective orders and other limitations on discovery available under California law.  The reference proceeding shall be conducted in accordance with California law (including the rules of evidence), and in all regards, the referee shall follow California law applicable at the time of the reference proceeding.  The parties shall promptly and diligently cooperate with one another and the referee, and shall perform such acts as may be 

   

  			
	 
	-3-
	HCP, INC.
[Second Amendment]
[Sorrento Therapeutics, Inc.]

   

   

   

  

  necessary to obtain a prompt and expeditious resolution of the dispute or controversy in accordance with the terms of this Section 6.  In this regard, the parties agree that the parties and the referee shall use best efforts to ensure that (a) discovery be conducted for a period no longer than six (6) months from the date the referee is appointed, excluding motions regarding discovery, and (b) a trial date be set within nine (9) months of the date the referee is appointed.  In accordance with Section 644 of the California Code of Civil Procedure, the decision of the referee upon the whole issue must stand as the decision of the court, and upon the filing of the statement of decision with the clerk of the court, or with the judge if there is no clerk, judgment may be entered thereon in the same manner as if the action had been tried by the court.  Any decision of the referee and/or judgment or other order entered thereon shall be appealable to the same extent and in the same manner that such decision, judgment, or order would be appealable if rendered by a judge of the Superior Court in which venue is proper hereunder.  The referee shall in his/her statement of decision set forth his/her findings of fact and conclusions of law.  The parties intend this general reference agreement to be specifically enforceable in accordance with the Code of Civil Procedure.  Nothing in this Section 6 shall prejudice the right of any party to obtain provisional relief or other equitable remedies from a court of competent jurisdiction as shall otherwise be available under the Code of Civil Procedure and/or applicable court rules.

  7.Warranties.  Landlord represents and warrants that, to its actual knowledge: (a) it is not in breach of any of its obligations under the Lease, and (b) Tenant is not in breach of any of its obligations under the Lease.  Tenant represents and warrants that, to its actual knowledge: (a) it is not in breach of any of its obligations under the Lease, and (b) Landlord is not in breach of any of its obligations under the Lease.

  8.Correction of Landlord Entity.  Landlord and Tenant hereby acknowledge and agree that the correct Landlord entity is HCP LIFE SCIENCE REIT, INC., a Maryland corporation, and not HCP LIFE SCIENCE ESTATES, INC., a Delaware corporation, as originally set forth in the Original Lease and First Amendment.  Landlord and Tenant each hereby ratify the Lease as if HCP LIFE SCIENCE REIT, INC., a Maryland corporation, was originally set forth therein as the Landlord entity.

  9.Additional Tenant Improvement Allowance.  The second to last sentence of Section 2.1.2 of the Tenant Work Letter, attached to the Lease as Exhibit B, is hereby amended and restated in its entirety as follows:

  "In the event that the Additional Tenant Improvement Allowance is not fully disbursed by Landlord on behalf of Tenant on or before June 30, 2022, then Tenant shall have no further rights with respect thereto."

  10.Signage. Subject to Landlord's prior written approval, which shall not be unreasonably withheld, conditioned or delayed, Tenant shall have the right, at Tenant’s sole cost and expense (but subject to the terms of that certain Lease between Landlord and Tenant with respect to premises located at 4921 Directors Place, San Diego, California 92121), to center its 

   

  			
	 
	-4-
	HCP, INC.
[Second Amendment]
[Sorrento Therapeutics, Inc.]

   

   

   

  

  signage on that certain freeway facing monument sign that serves the buildings located at 4939 Directors Place, and 4955 Directors Place, San Diego, California 92121.  Any such movement of the Tenant’s sign shall be subject to Tenant's obtaining all required governmental approvals.

  11.No Further Modification.  Except as specifically set forth in this Second Amendment, all of the terms and provisions of the Lease shall remain unmodified and in full force and effect.

  [SIGNATURES FOLLOW ON NEXT PAGE]

   

   

  			
	 
	-5-
	HCP, INC.
[Second Amendment]
[Sorrento Therapeutics, Inc.]

   

   

   

  

  IN WITNESS WHEREOF, this Second Amendment has been executed as of the day and year first above written.

  		
	"LANDLORD"
	HCP LIFE SCIENCE REIT, INC., 
a Maryland corporation

	 
	By: /s/ Mike Dorris                                          
Mike Dorris
Print Name
Its:      Senior Vice President                     

	 
	 

	"TENANT"
	SORRENTO THERAPEUTICS, INC.,
a Delaware corporation

	 
	By: /s/ Henry Ji                                                
Henry Ji
Print Name
Its:               CEO                             
By: ___________________________
 
Print Name
Its:                                                             

   

   

   

  			
	 
	-6-
	HCP, INC.
[Second Amendment]
[Sorrento Therapeutics, Inc.]Document

Exhibit 4.10

Description of Registrant’s Securities

As of November 5, 2021, the common stock of GWG Holdings, Inc. (“we,” “us,” “our,” or the “Company”) is the only class of the Company’s securities registered under Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”).   

The following is a description of our common stock and the material provisions of our Certificate of Incorporation, bylaws and other agreements to which we and our stockholders are parties. The following is only a summary and is qualified by applicable law and by the provisions of our Certificate of Incorporation, bylaws and other agreements, copies of which are included as exhibits to the report to which this Exhibit is attached. 

Common Stock

Voting. The holders of our common stock are entitled to one vote for each outstanding share of common stock owned by that stockholder on every matter properly submitted to the stockholders for their vote. Stockholders are not entitled to vote cumulatively for the election of directors.

Dividend Rights. Subject to the dividend rights of the holders of any outstanding series of preferred stock, holders of our common stock are entitled to receive ratably such dividends and other distributions of cash or any other right or property as may be declared by our Board of Directors out of our assets or funds legally available for such dividends or distributions.

Liquidation Rights. In the event of any voluntary or involuntary liquidation, dissolution or winding up of our affairs, holders of our common stock would be entitled to share ratably in our assets that are legally available for distribution to stockholders after payment of liabilities. If we have any preferred stock outstanding at such time, holders of the preferred stock may be entitled to distribution and/or liquidation preferences. In either such case, we must pay the applicable distribution to the holders of our preferred stock before we may pay distributions to the holders of our common stock.

Conversion, Redemption and Preemptive Rights. Holders of our common stock have no conversion, redemption, preemptive, subscription or similar rights.

Limitations on Directors’ Liability; Indemnification of Directors and Officers

Our Certificate of Incorporation and bylaws contain provisions indemnifying our directors and officers to the fullest extent permitted by law. In addition, as permitted by Delaware law, our Certificate of Incorporation provides that no director will be liable to us or our stockholders for monetary damages for breach of certain fiduciary duties as a director. The effect of this provision is to restrict our rights and the rights of our stockholders in derivative suits to recover monetary damages against a director for breach of certain fiduciary duties as a director, except that a director will be personally liable for:
•any breach of his or her duty of loyalty to us or our stockholders;
•acts or omissions not in good faith which involve intentional misconduct or a knowing violation of law;
•the payment of dividends or the redemption or purchase of stock in violation of Delaware law; or
•any transaction from which the director derived an improper personal benefit.
This provision does not affect a director’s liability under the federal securities laws.

Article 6 of our corporate bylaws provides that we shall indemnify our directors, officers, employees and agents to the fullest extent permitted by the Delaware General Corporation Law. Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers or persons controlling GWG Holdings, Inc. pursuant to the foregoing provisions, we understand that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act of 1933 and is therefore unenforceable.

We have entered into Indemnification Agreements (the “Indemnification Agreements”) with each of our current directors and executive officers (collectively, the “Indemnitees”). The Indemnification Agreements clarify and supplement indemnification provisions already contained in the Company’s bylaws and generally provide that the Company shall indemnify the Indemnitees to the fullest extent permitted by applicable law, subject to certain exceptions, against expenses, judgments, fines and other amounts actually and reasonably incurred in connection with their service as a director or officer and also provide for rights to advancement of expenses and contribution.

We have purchased directors’ and officers’ liability insurance through in order to limit the exposure to liability for indemnification of directors and officers, including liabilities under the Securities Act of 1933.

Provisions of Our Certificate of Incorporation and Bylaws and Delaware Law that May Have an Anti-Takeover Effect

Certain provisions set forth in our Certificate of Incorporation, in our bylaws and in Delaware law, which are summarized below, may be deemed to have an anti-takeover effect and may delay, deter or prevent a tender offer or takeover attempt that a stockholder might consider to be in its best interests, including attempts that might result in a premium being paid over the market price for the shares held by stockholders.

Classified Board and Related Board Matters. In early 2019, our Board of Directors and stockholders approved an amendment to our bylaws that established a classified Board of Directors in which directors are divided into three classes, designated as Class I, Class II and Class III. Each class serves staggered, three year terms, except as described below. The terms of office of Class II directors expired at the annual meeting of stockholders that was to be held in 2020. However, because the 2020 annual meeting of stockholders will be held in 2021, the terms of office of the Class II directors will expire at the combined 2020/2021 annual meeting of stockholders to be held in 2021, and their successors will be elected for a two year term expiring at the 2023 annual meeting of stockholders. The terms of office of the Class III directors will expire at the combined 2020/2021 annual meeting of stockholders. The terms of office of the Class I directors will expire at the annual meeting of stockholders to be held in 2022.

In addition to establishing a classified board, the Bylaw amendment provides that newly created directorships resulting from any increase in the authorized number of directors and any vacancies occurring on the Board be filled by the affirmative vote of a majority of the remaining members of the Board, provides that directors may be removed only for cause and only by the affirmative vote of the holders of two-thirds or more of the outstanding voting power of the Company, and requires a two-thirds supermajority approval of stockholders for stockholders to adopt further amendments to provisions of the Bylaws that govern (A) the number, qualification and term of office of directors, (B) the filling of newly created directorships and vacancies, (C) the resignation and removal of directors, (D) the right to indemnification for directors and other covered persons, and (E) the requisite approval for certain future bylaw amendments.

Advance Notice Provisions for Raising Business or Nominating Directors.  Under our Bylaws, if a stockholder wishes to propose an item of business to be considered at our annual stockholders’ meeting (including director nominations), that stockholder must deliver notice of the proposal or proposed director’s name at our principal executive offices not less than 90 nor more than 120 calendar days prior to the first anniversary of the date on which we first mailed proxy materials for the preceding year’s annual meeting. 

If the date of our annual stockholders’ meeting is advanced more than 30 calendar days prior to or delayed by more than 60 calendar days after the anniversary of the most recent annual stockholders’ meeting, timely notice of stockholder proposals and stockholder nominations for directors may be delivered to or mailed and received at our principal executive offices not less than 90 nor more than 120 calendar days prior to the date of such annual meeting, or if the first public announcement of the date of such annual meeting is less than 100 days prior to the date of such annual meeting, not later than the close of business on the 10th calendar day following the day on which we first make a public announcement of the date of such meeting.

Notices of stockholder proposals and stockholder nominations for directors must comply with the informational and other requirements set forth in our Bylaws as well as applicable statutes and regulations. 

Blank Check Preferred Stock. Under our Certificate of Incorporation, our Board of Directors has the authority to fix by resolution the terms and conditions of one or more series of preferred stock and provide by resolution for the issuance of shares of such series.

We believe that the availability of our preferred stock, in each case issuable in series, and additional shares of common stock could facilitate certain financings and acquisitions and provide a means for meeting other corporate needs which might arise. The authorized shares of our preferred stock, as well as authorized but unissued shares of common stock, will be available for issuance without further action by our shareholders, unless shareholder action is required by applicable law or the rules of any stock exchange on which any series of our stock may then be listed, or except as may be provided in the terms of any preferred stock created by resolution of our Board of Directors.

 These provisions give our Board of Directors the power to approve the issuance of a series of preferred stock, or additional shares of common stock, that could, depending on its terms, either impede or facilitate the completion of a merger, tender offer or other takeover attempt. For example, the issuance of new shares of preferred stock might impede a business combination if the terms of those shares include voting rights which would enable a holder to block business combinations or, alternatively, might facilitate a business combination if those shares have general voting rights sufficient to cause an applicable percentage vote requirement to be satisfied.

Special Meetings of Stockholders. Our bylaws provide that special meetings of stockholders may be called only by the chairman or by a majority of the members of our board. Stockholders are not permitted to call a special meeting of stockholders, to require that the chairman call such a special meeting, or to require that our board request the calling of a special meeting of stockholders.

Delaware Takeover Statute

In general, Section 203 of the Delaware General Corporation Law prohibits a Delaware corporation that is a public company from engaging in any “business combination” (as defined below) with any “interested stockholder” (defined generally as an entity or person beneficially owning 15% or more of the outstanding voting stock of the corporation and any entity or person affiliated with such entity or person) for a period of three years following the date that such stockholder became an interested stockholder, unless: (1) prior to such date, the Board of Directors of the corporation approved either the business combination or the transaction that resulted in the stockholder becoming an interested stockholder; (2) on consummation of the transaction that resulted in the stockholder becoming an interested stockholder, the interested stockholder owned at least 85% of the voting stock of the corporation outstanding at the time the transaction commenced, excluding for purposes of determining the number of shares outstanding those shares owned (x) by persons who are directors and also officers and (y) by employee stock plans in which employee participants do not have the right to determine confidentially whether shares held subject to the plan will be tendered in a tender or exchange offer; or (3) on or subsequent to such date, the business combination is approved by the Board of Directors and authorized at an annual or special meeting of stockholders, and not by written consent, by the affirmative vote of at least two-thirds of the outstanding voting stock that is not owned by the interested stockholder.

Section 203 of the Delaware General Corporation Law defines “business combination” to include: (1) any merger or consolidation involving the corporation and the interested stockholder; (2) any sale, transfer, pledge or other disposition of 10% or more of the assets of the corporation involving the interested stockholder; (3) subject to certain exceptions, any transaction that results in the issuance or transfer by the corporation of any stock of the corporation to the interested stockholder; (4) any transaction involving the corporation that has the effect of increasing the proportionate share of the stock of any class or series of the corporation beneficially owned by the interested stockholder; or (5) the receipt by the interested stockholder of the benefit of any loans, advances, guarantees, pledges or other financial benefits provided by or through the corporation.

Potential for Anti-Takeover Effects

While the foregoing provisions of our Certificate of Incorporation, bylaws and Delaware law may have an anti-takeover effect, these provisions are intended to enhance the likelihood of continuity and stability in the composition of our Board of Directors and in the policies formulated by the board, and to discourage certain types of transactions that may involve an actual or threatened change of control. In that regard, these provisions are designed to reduce our vulnerability to an unsolicited acquisition proposal. The provisions also are intended to discourage certain tactics that may be used in proxy fights. However, such provisions could have the effect of discouraging others from making tender offers for our shares and, as a consequence, they also may inhibit fluctuations in the market price of our common stock that could result from actual or rumored takeover attempts. Such provisions also may have the effect of preventing changes in our management.

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