Exhibit 10.31

 

SUBLEASE

 

THIS SUBLEASE (this “Sublease”) is made and entered as of this 8th day of
February, 2016 (the “Effective Date”) by and between REC AMERICAS LLC, a
Delaware limited liability company (“Sublandlord”), and ADYNXX, INC., a Delaware
corporation (“Subtenant”).

 

RECITALS

 

A.         Sublandlord is the current tenant of certain premises, depicted on
the floor plan attached hereto as Exhibit A, consisting of 3,659 rentable square
feet located at 100 Pine Street, Suite 500, San Francisco, California (the
“Master Premises”), pursuant to that certain Office Lease (the “Master Lease”)
dated as of October 27, 2014, by and between 100 Pine Street Investment Group,
L.L.C., a Delaware limited liability company, as landlord (the “Master Lessor”),
and Sublessor as tenant. A true, correct and complete copy of the Master Lease
is attached hereto as Exhibit B.

 

B.         Sublandlord desires to sublease the entire Master Premises to
Subtenant, and Subtenant desires to sublease the entire Premises from
Sublandlord, on the terms and conditions contained in this Sublease.
Hereinafter, the Master Premises are sometimes referred to as the “Premises.”

 

NOW, THEREFORE, for valuable consideration, the receipt and sufficiency of which
are acknowledged, the parties agree as follows:

 

1.           Sublease of Premises.

 

1.1     Sublease. Subject to receipt of Landlord’s Consent (as defined below),
Sublandlord leases the Premises to Subtenant, and Subtenant leases the Premises
from Sublandlord for the term, at the rentals and upon the terms and conditions
set forth below. Any capitalized terms not otherwise defined herein shall be as
defined in the Master Lease.

 

1.2     Condition of Premises. Sublandlord shall provide the Premises in their
“as is” condition as of the date of this Sublease (but (a) with the benefit of
any representations and warranties set forth in the Master Lease and (b) vacant,
broom clean and free of all waste, equipment, fixtures and personal property
except for the furniture and fixtures listed in Schedule A to that certain Bill
of Sale dated on or about the date hereof (the “Bill of Sale”)), and Sublandlord
shall have no obligation to install any tenant improvements, renovate or remodel
the Premises, or otherwise prepare the Premises for occupancy by Subtenant.
Except as expressly set forth in Sections 5.4 and 12.5 of this Sublease,
Sublandlord makes no representations or warranties, whether express or implied,
with respect to the Premises or the equipment, furniture and systems used in
connection with the Premises (including without limitation any representation or
warranty of habitability or of fitness for any particular purpose); provided
however that notwithstanding the foregoing (x) Sublandlord does represent and
warrant that it has no knowledge of any material defects in the Premises (or its
equipment, furniture, systems or fixtures) and (y) Sublandlord shall be
responsible for, and shall promptly repair, any damage to the Premises and the
Building caused by Sublandlord moving out of the Premises and the Building.

 

2.           Term.

 

2.1     Term and Commencement Date. The term of this Sublease (the “Term”) shall
commence on the later of (a) March 1, 2016, (b) the date the Sublease is fully
executed, (c) the date of receipt by Subtenant of Master Lessor’s executed
written consent to this Sublease, in a form reasonably acceptable to Subtenant
and including the non-disturbance provision described in Section 12.2 below (the
“Landlord’s Consent”), or (d) the date upon which Sublandlord shall deliver the
Premises to Subtenant in the condition required by Section 1.2 (the
“Commencement Date”), and shall continue in effect until December 31, 2019,
unless earlier terminated pursuant to the terms of this Sublease. In the event
Master Lessor shall not have provided the Landlord’s Consent on or before thirty
(30) days following the Effective Date, then Subtenant shall have the right, in
its sole discretion, to terminate this Sublease, in which event Sublandlord
shall promptly return to Subtenant any security deposit, rent and other amounts
paid by Subtenant and the parties shall be released of all obligations under
this Sublease. Sublandlord agrees to use commercially reasonable efforts to
expeditiously obtain the Landlord’s Consent and to pay whatever review (and
other) fees Master Lessor shall properly assess in accordance with the Master
Lease in connection with its review of this Sublease and its issuance of the
Landlord’s Consent.

 

1.

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2.2     Early Access. As long as Subtenant has delivered to Sublandlord the
prepaid rent, security deposit and certificates of insurance required by this
Sublease, Subtenant shall have the right to access the Premises from and after
the later of (a) February 15, 2016, or (b) the date that Master Lessor delivers
its Landlord’s Consent (the “Early Access Date”), for the limited purposes, of
installing trade fixtures, equipment, cabling, furniture and conducting other
customary pre-commencement activities, but not for the purpose of conducting its
business from the Premises. If Subtenant totally or partially occupies the
Premises after the Early Access Date but prior to the Commencement Date for such
limited purposes, Subtenant shall have no obligation to pay Base Rent or
Additional Rent during such period, but all other terms of this Sublease
(including but not limited to the insurance obligations set forth in Article 9)
shall be in effect during such period. Any such early possession shall not
affect or advance the Commencement Date or the Term. During any such early
possession, (a) Subtenant shall not commence the operation of business, and (b)
Subtenant shall at all times comply with Master Lessor’s rules and regulations
regarding tenant move-in procedures. If Subtenant breaches of any of the
foregoing conditions, and if such breach continues after notice and a three-day
grace period, Sublandlord may, in addition to exercising any of its other rights
and remedies set forth in this Sublease, revoke Subtenant’s right to early
access to the Premises upon written notice to Subtenant.

 

3.           Rent.

 

3.1     Base Rent. During the Term, Subtenant shall pay Sublandlord monthly base
rent (“Base Rent”) as follows:

 

Period of Time

Annual Base Rent

Monthly Base Rent

Annual Rent per RSF

3/1/16 — 2/28/17*

$219,540.00*

$18,295.00*

$60.00

3/1/17 — 2/28/18

$226,126.20

$18,843.85

$61.80

3/1/18 — 2/28/19

$232,909.99

$19,409.17

$63.65

3/1/19 — 12/31/19

$239,897.29**

$19,991.44

$65.56

 

*To be reduced pro rata, on a daily basis, to the extent that the Commencement
Date is delayed beyond March 1, 2016.

 

**The parties agree that this “annual base rent” for the 3/1/19-12/31/19 period
shall not be fully payable, but only 10 months multiplied by the monthly rent of
$19,991.44, or $199,914.40.

 

3.2     Additional Rent. In addition to Base Rent, Subtenant shall pay
Sublandlord an amount equal to the “Additional Rent” payable by Sublandlord
under the Master Lease to the extent incurred during the Term of this Sublease,
excluding any amounts arising from defaults by Sublandlord under the Master
Lease (the “Additional Rent”); provided, however, (a) the Additional Rent
payable by Subtenant hereunder shall be calculated based upon a “Base Year (as
defined in the Master Lease) of calendar year 2016, and (b) Sublandlord shall be
solely liable and responsible for all payments of Additional Rent under the
Master Lease other than the Additional Rent payable by Subtenant hereunder,
whether arising prior to, during or after the end of the Term.

 

3.3     Rent. Base Rent, Additional Rent and any other amounts payable under
this Sublease are referred to collectively as “Rent.”

 

3.4     Payment of Rent. Upon execution of this Sublease, Subtenant shall pay to
Sublandlord Base Rent in an amount equal to Base Rent for the first full
calendar month of the Term (i.e., $18,295.00), which shall be applied toward the
Base Rent first due under this Sublease. Following such payment, all Base Rent
and Additional Rent payable under this Sublease shall be due and payable in
advance, without off-set or deduction (except as otherwise set forth in this
Sublease or the Master Lease), on the first day of each month during the Term of
this Sublease. If any month during the Term is not a full month, Base Rent and
Additional Rent for such month shall be prorated based on the actual number of
days in that month.

 

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3.5     Late Charges. If any Rent is not paid within five (5) days of the date
when due, Subtenant shall pay a late charge to Sublandlord equal to five percent
(5%) of the delinquent amount. Neither demand for, nor receipt of, any late
charge called for under this Sublease shall (a) operate to waive any default by
Subtenant or provide a substitute for Subtenant’s full and timely performance of
the obligation to pay Rent, or (b) limit the exercise of any other right or
remedy Sublandlord may have under this Sublease in case of Subtenant’s default.
If any payment of Rent is returned for insufficient funds, Sublandlord shall
have the right to require future payments to be paid by cashiers check, ACH or
other electronic means.

 

4.           Security Deposit.

 

4.1     Upon the execution of this Sublease, Subtenant shall pay to Sublandlord
a security deposit in the amount of $73,180.00 (the “Security Deposit”). If
Subtenant has not been in default under this Sublease as of the end of the first
year of the Term, Landlord agrees to reduce the Security Deposit, effective as
of the first day of the second year of the Term, to $54,885, and shall return to
Subtenant $18,295.00 of the Security Deposit then held by Sublandlord; provided,
however, if Subtenant has been in default under this Sublease during the first
year of the Term, the Security Deposit will not be so reduced. Upon expiration
of the Term, as long as Subtenant is not in default under this Sublease
Sublandlord shall return the Security Deposit to Subtenant not later than 30
days thereafter, after deducting in good faith the reasonable amounts needed to
make good any default by Subtenant. Sublandlord shall have the right, but not
the obligation, after five days prior notice to Subtenant, to apply all or any
portion of the Security Deposit to cure any Subtenant default at any time, in
which case Subtenant shall be obligated to restore the Security Deposit to its
original amount within ten (10) business days. Subtenant waives the provisions
of Section 1950.7 of the California Civil Code, and all other provisions of law,
now or hereafter in force, which provide that Sublandlord may claim from a
security deposit only those sums reasonably necessary to remedy defaults in the
payment of rent, to repair damage caused by Subtenant or to clean the Premises,
it being agreed that Sublandlord may, in addition, claim those sums reasonably
necessary to compensate Sublandlord for any defaults of Subtenant under this
Sublease.

 

4.2     Sublandlord agrees that Subtenant shall deliver $18,295.00 of the
Security Deposit in the form of a cash deposit concurrently with the execution
of this Sublease, and within five (5) business days following execution of this
Sublease, Subtenant shall deliver $54,885.00 of the Security Deposit in the form
of an unconditional and irrevocable letter of credit (the “Letter of Credit”).
The Letter of Credit shall (a) be in the amount of $54,885.00, (b) be in form
and substance reasonably satisfactory to Sublandlord, (c) name Sublandlord as
its beneficiary, (d) expressly allow Sublandlord to draw upon it at any time or
from time to time following an event of default in the amount of the applicable
default by delivering to the issuer written notice, (e) be drawn on an
FDIC-insured financial institution reasonably satisfactory to Sublandlord with a
branch office in San Francisco, CA, (f) be freely transferable by Sublandlord,
and (g) have an expiration date of not earlier than the expiration date of this
Sublease, or provides for automatic renewals through the expiration date of this
Sublease. If Sublandlord is not provided with a substitute Letter of Credit
complying with all of the requirements hereof at least ten (10) days before the
applicable expiration date of the existing Letter of Credit, then Sublandlord
shall have the right to draw under such Letter of Credit then held by
Sublandlord and hold such funds as a cash security deposit in accordance with
the terms of this Article 4.

 

4.3     Sublandlord shall keep the $18,295 of the Security Deposit that will be
delivered in the form of a cash deposit in a separate account from its general
accounts. Unless otherwise expressly agreed in writing by Sublandlord, no part
of the Security Deposit shall be considered to be held in trust, to bear
interest, or to be prepayment for any monies to be paid by Subtenant under this
Sublease. If Sublandlord keeps the Security Deposit in an interest bearing
account, all interest shall accrue for the benefit of Sublandlord.

 

3.

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5.           Use.

 

5.1     Permitted Use. Subtenant will use and occupy the Premises solely for
general office uses and for no other use.

 

5.2     Access. Throughout the Term of this Sublease, Subtenant and its
employees shall have access to the Premises twenty-four (24) hours per day,
seven (7) days per week, subject to any contrary provisions stated in the Master
Lease. Sublandlord shall furnish Subtenant with keys or key cards to the
Premises upon receipt of request from Subtenant. Subtenant agrees to comply with
all requirements of the Master Landlord relating to the keys or key cards, and
shall pay Sublandlord any charges incurred with respect to providing such keys
or key cards to Subtenant or replacing any lost keys or key cards. Upon the
expiration or earlier termination of this Sublease, Subtenant will deliver to
Sublandlord all keys and key cards that were previously provided to it.

 

5.3     Compliance with Master Lease.

 

(a)     Neither Sublandlord nor Subtenant will conduct any activity that would
be prohibited under the terms of the Master Lease, and neither shall take any
action that would cause Sublandlord to be in default under the Master Lease.

 

(b)     Sublandlord will not terminate (and will not permit the termination of)
the Master Lease for any reason, and Sublandlord hereby assigns, sublets and
conveys to Subtenant all of Sublandlord’s right, title and interest in
Sublandlord’s right of early termination as set forth in the Master Lease at
Section 52(b). In furtherance of the foregoing, (a) Sublandlord shall take all
appropriate action so that the Master Lease is and shall remain in full force
and effect and (b) upon notice from Subtenant, Sublandlord shall take all
appropriate action to cooperate with Subtenant in the exercise of the early
termination option set forth in Section 52(b) of the Master Lease.

 

(c)     Sublandlord shall promptly send to Subtenant any notices it receives
from Master Lessor.

 

(d)     At expiration of this Sublease, Sublandlord shall remove all Alterations
it has previously made (including cabling) unless such removal is not required
by the terms of the Master Lease, except Sublandlord shall not be required to
remove any Alterations that are included in the property conveyed to Subtenant
pursuant to the Bill of Sale.

 

5.4     Compliance With Laws. Subtenant shall comply with all governmental laws,
ordinances, rules, regulations and orders applicable to the use by Subtenant of
the Premises and shall promptly comply with all governmental orders and
directives for the correction, prevention and abatement of any public or private
nuisance under California law or unpermitted use in or at the Premises, all at
Subtenant’s sole expense, Without limiting the foregoing, Subtenant shall be
solely responsible for ensuring that the Premises and Subtenant’s use of the
Premises comply with the requirements of Section 8 of the Master Lease
(including, without limitation, with respect to compliance with the Disabilities
Acts, as defined therein). At Sublandlord’s written request, Subtenant shall
furnish Sublandlord with evidence of all required licenses and permits for
operation of Subtenant’s business at the Premises. Subtenant shall not permit
any action that would constitute a public or private nuisance under California
law.

 

6.     Parking. Subtenant acknowledges that, except as set forth in Section
52(a) of the Master Lease, parking is not provided under the Master Lease and,
accordingly, except as set forth in Section 52(a) of the Master Lease, this
Sublease provides Subtenant with no parking rights. If Subtenant otherwise
wishes to park in the building, Subtenant shall arrange for parking directly
with the parking company that provides parking in the Building.

 

7.     Alterations. Subtenant shall not have the right to install any
alterations or improvements in the Premises without complying with the
provisions of Section 6 of the Master Lease. Alterations shall be constructed
and installed in accordance with and shall be subject to all relevant provisions
of the Master Lease, including without limitation Sections 6, 7 and 8 of the
Master Lease.

 

4.

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8.     Assignment or Subletting. Subtenant shall not have the right to assign
this Sublease or further sublet any portion of the Premises without complying
with the provisions of Section 15 of the Master Lease. Any assignment or
subletting will be subject to the requirements, terms and conditions of the
Master Lease. It is understood and agreed that Sublandlord shall be solely
responsible for full compliance with the provisions of Section 15(f) of the
Master Lease with respect to this Sublease, and shall promptly pay to Master
Lessor any Transfer Consideration and/or Transfer Premium due to Master Lessor
with respect to this Sublease.

 

9.     Insurance.

 

9.1     Insurance Requirements. Prior to the Commencement Date or any earlier
entry onto the Premises, Subtenant shall provide Sublandlord with evidence that
Subtenant has obtained and maintains the same policies of insurance that Tenant
is required to carry under the Master Lease, in the amounts and subject to the
requirements stated therein. Subtenant shall maintain all such policies in
effect throughout the entire Term. The liability coverage provided by such
policies shall in no way limit Subtenant’s liability for claims in excess of
Subtenant’s policy limits. Such policies obtained by Subtenant shall name both
Sublandlord and Master Landlord as additional insureds (and any other parties
required by the Master Lease to be named as additional insureds).

 

9.2     Waiver of Subrogation. Sublandlord hereby waives all rights of recovery
against Subtenant on account of loss and damage occasioned to Sublandlord for
its property or the property of others under its control to the extent that such
loss or damage is insured against under any insurance policies which may be in
force at the time of such loss or damage, or which are required to be maintained
by Sublandlord, even if Sublandlord fails to obtain and maintain such coverage.
Subtenant hereby waives all rights of recovery against Sublandlord on account of
loss and damage occasioned to Subtenant or its property or the property of
others under its control to the extent that such loss or damage is insured
against under any insurance policies which may be in force at the time of such
loss or damage, or which are required to be maintained by Subtenant, even if
Subtenant fails to obtain and maintain such coverage. Subtenant and Sublandlord
shall, upon obtaining policies of insurance required hereunder or under the
Master Lease, give notice to the insurance carrier that the foregoing mutual
waiver of subrogation is contained in this Sublease and Subtenant and
Sublandlord shall cause each insurance policy obtained by such party to provide
that the insurance company waives all right of recovery by way of subrogation
against either Sublandlord or Subtenant in connection with any damage covered by
such policy.

 

10.     Surrender. Upon the expiration or earlier termination of this Sublease,
Subtenant shall surrender and deliver up the Premises in the condition required
by Sections 5(c) and 6(c) of the Master Lease, with all of Subtenant’s personal
furniture, fixtures and equipment (including, without limitation, all furniture,
fixtures and equipment conveyed to Subtenant pursuant to the Bill of Sale), and
all Alterations made by or on behalf of Subtenant, removed from the Premises (to
the extent required by the Master Lease), provided however, that Sublandlord
shall continue to be obligated to remove any Alterations (if any) made by or on
behalf of Sublandlord prior to the Effective Date of this Sublease (to the
extent required by the Master Lease) and to repair any damage to the Premises
caused by such removal. Subtenant shall repair any damage to the Premises caused
by the removal of its furniture, fixtures and equipment (including, without
limitation, all furniture, fixtures and equipment conveyed to Subtenant pursuant
to the Bill of Sale), and the removal of any Alterations made by or on behalf of
Subtenant. If Subtenant fails to remove any items of furniture, fixtures or
equipment on or before the expiration or earlier termination of this Sublease,
Sublandlord may, at its option, deem such items to be abandoned and may, at its
option, remove the same (and repair any damage occasioned thereby and restore
the Premises as aforesaid at Subtenant’s cost) and dispose of or warehouse such
items or warehouse, and Subtenant shall pay the cost of such removal, repair,
restoration, disposal or warehousing to Sublandlord on demand, or Sublandlord
may treat such items as having been conveyed to Sublandlord with this Sublease
acting as a bill of sale therefor, without further payment or credit by
Sublandlord to Subtenant.

 

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11.     Default and Remedies. Subtenant shall be in default under this Sublease
if Subtenant fails to pay any amount or perform any other obligation required by
this Sublease when due, subject to the same notice and expiration of grace or
cure periods as are applicable to Sublandlord under the Master Lease
(“default”). Upon any such default, Sublandlord shall have the same remedies
that Master Landlord has under the Master Lease with respect to defaults
thereunder by Sublandlord, in addition to any rights or remedies available at
law or in equity, and all such remedies shall be cumulative. Without limiting
the generality of the foregoing, Sublandlord may exercise the damage remedies
available under California Civil Code Sections 1951.2 and 1951.4 or any similar
or successor statute which provides that a lessor may continue a lease in effect
and recover damages as they become due.

 

12.     Provisions Regarding Master Lease.

 

12.1     Consent of Master Landlord. This Sublease is conditioned upon the
Master Landlord delivering its executed Landlord’s Consent. Subject to the
provisions of Section 2.1, if the Master Landlord does not consent to this
Sublease, neither party hereunder shall have any rights or obligations under
this Sublease.

 

12.2     Subordination to Master Lease. This Sublease is subject and subordinate
to the Master Lease.

 

12.3     Incorporation of Terms of Master Lease.

 

(a)     The parties acknowledge that it is not practical in this Sublease to
enumerate all of the rights and obligations of the various parties under the
Master Lease and specifically to allocate those rights and obligations in this
Sublease. Accordingly, in order to afford to Subtenant the benefits of this
Sublease and of those provisions of the Master Lease which by their nature are
intended to benefit the party in possession of the Premises, and in order to
protect Sublandlord against a default by Subtenant which causes a default by
Sublandlord under the Master Lease, all of the terms and conditions contained in
the Master Lease are incorporated as the terms and conditions of this Sublease,
except the following provisions which do not have any application to this
Sublease: (a) any provisions relating to Sublandlord’s payment of Rent to Master
Landlord; (b) any provisions relating to the term of the Master Lease (except
that if the term of the Master Lease is terminated prior to the expiration of
this Sublease, this Sublease shall terminate (unless Subtenant otherwise agrees
with Master Lessor and except as otherwise set forth in the Landlord’s Consent),
and if such termination arises in connection with any default, breach, failure,
act or omission of Sublandlord, then (i) Sublandlord shall be liable to
Subtenant for all damages, losses, liabilities, costs and expenses arising
therefrom, including without limitation reasonable attorney’s fees
(collectively, “Losses”) and (ii) Sublandlord hereby agrees to indemnify,
protect, defend and hold Subtenant harmless from all such Losses); (c) any
options to expand the Master Premises or to extend the term of the Master Lease;
(d) any rights of first refusal or rights of first offer that may be stated in
the Master Lease; (e) intentionally deleted; (f) any signage rights (except(i)
Subtenant shall have the same signage rights as set forth in Section 45 of the
Master Lease, (ii) Sublandlord shall remove its sign adjacent to the main
entrance of the Premises and install (or cause Master Lessor to install, at
Sublandlord’s sole cost and expense) Subtenant’s Building standard sign no later
than ________, 2016); (g) any rights to receive tenant improvement allowances or
similar allowances; (h) any provisions that conflict with the terms and
conditions stated in this Sublease; (i) Basic Lease Provisions 4,5,9, 10, 11,
and 14; and (j) Lease Provisions 2, 4, 19(a) and (b), 33 All incorporated
provisions of the Master Lease (the “Incorporated Provisions”) shall be deemed
to operate prospectively from and after the Commencement Date of this Sublease.

 

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(b)     All provisions of the Master Lease that require the “Tenant” to seek the
prior approval or consent of the “Landlord” shall require Subtenant to seek the
prior approval or consent of each of Sublandlord and the Master Lessor, which,
in the case of Sublandlord, shall not be unreasonably withheld, conditioned or
delayed, and in the case of Master Lessor, shall be governed by the same
standards applicable as between Tenant and Master Lessor under the Master Lease.
All notices required to be given by the “Tenant” to the “Landlord” under the
Master Lease shall require Subtenant to provide such notices to each of
Sublandlord and the Master Lessor. All notices to be provided to Subtenant,
Sublandlord or the Master Lessor shall be given in the manner set forth in the
Master Lease, to the following addresses:

 

If to the Master Lessor:

100 Pine Street Investment Group, L.L.C.

100 Pine Street, Suite 325

San Francisco, CA 94111

Attn: Property Manager

Fax: 415-986-3735

 

If to Sublandlord:

REC Americas LLC

3592 Sacramento Drive, Suite 170

San Luis Obispo, CA 93401

Attn: ____________________

 

If to Subtenant:

Rick Orr, President

Adynxx, Inc.

100 Pine Street, Suite 500

San Francisco, CA 94111

 

(c)     Each reference in Incorporated Provisions of the Master Lease to the
“Lease” shall mean this Sublease, and each reference in Incorporated Provisions
of the Master Lease to “Landlord” and “Tenant” shall refer in this Sublease to
Sublandlord and Subtenant, respectively.

 

12.4     Interpretation of Lease. The Incorporated Provisions of the Master
Lease, along with all of the terms and conditions set forth in full in the text
of this Sublease, shall constitute the terms and conditions of this Sublease. In
the event of any conflict between the Incorporated Provisions and the text of
this Sublease concerning the rights, duties or obligations of the parties under
this Sublease, the terms set forth in full herein shall control.

 

12.5     Sublandlord Representations and Warranties. Sublandlord hereby
represents and warrants as follows:

 

(a)     The Master Lease is not modified or amended and is in full force and
effect;

 

(b)     Sublandlord has not sublet the Premises or assigned the Master Lease and
has full and complete authority to enter into this Sublease:

 

(c)     Sublandlord has not filed (and has no present intention to file) any
petition or debtor’s claim under Federal or state bankruptcy or insolvency laws,
and no such action has been filed against Sublandlord; and

 

(d)     the Commencement Date of the Master Lease is November 21, 2014 and the
Expiration Date of the Master Lease is December 31, 2019.

 

13.         Indemnification.

 

13.1     Except to the extent caused by the negligence or willful misconduct of
Sublandlord or Sublandlord’s agents, employees or contractors, Sublandlord’s
breach of the Master Lease or this Sublease, or Sublandlord’s acts on the
Premises, Subtenant agrees to indemnify, protect and defend Sublandlord against
and hold Sublandlord harmless from any and all loss, cost, liability, damage and
expense, including, without limitation, penalties, fines and counsel fees and
disbursements, and any claims by any persons by reason of injury or death to
persons or damage to property occasioned by any use, occupancy, condition,
occurrence, happening, act, omission or negligence, incurred in connection with
or arising from (a) any default by Subtenant in the observance or performance of
any of the terms, covenants or conditions of this Sublease; and/or (b) the use
or occupancy or manner of use or occupancy of the Premises by Subtenant or any
person claiming through or under Subtenant, or of the employees, agents,
licensees or invitees of Subtenant, in, on, or about the Premises during the
term of this Sublease, including, without limitation, any act, omission or
negligence in the making or performing of any alterations.

 

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13.2     Except to the extent caused by the negligence or willful misconduct of
Subtenant or Subtenant’s agents, employees or contractors, Subtenant’s breach of
the Master Lease or this Sublease, or Subtenant’s acts on the Premises,
Sublandlord agrees to indemnify, protect and defend Subtenant against and hold
Subtenant harmless from any and all loss, cost, liability, damage and expense,
including, without limitation, penalties, fines and counsel fees and
disbursements, and any claims by any persons by reason of injury or death to
persons or damage to property occasioned by any use, occupancy, condition,
occurrence, happening, act, omission or negligence, incurred in connection with
or arising from (a) any default by Sublandlord in the observance or performance
of any of the terms, covenants or conditions of this Sublease and/or (b) the use
or occupancy or manner of use or occupancy of the Premises by Sublandlord (prior
to the Commencement Date) or any person claiming through or under Sublandlord,
or of the employees, agents, licensees or invitees of Sublandlord, in, on, or
about the Premises, including, without limitation, any act, omission or
negligence in the making or performing of any alterations.

 

14.     Brokers. Sublandlord and Subtenant warrant to each other that they have
had no dealings with any real estate broker or agent in connection with the
negotiation of this Sublease other than CM Commercial Real Estate Inc.
representing Subtenant and Cushman & Wakefield of California, Inc: representing
Sublandlord (collectively, the “Brokers”), and that they know of no real estate
brokers or agents other than the Brokers who are entitled to a commission in
connection with this Sublease. Sublandlord shall pay a commission to the Brokers
pursuant to a separate agreement. 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, and 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
the indemnifying party’s dealings with any real estate broker or agent.

 

15.     USA Patriot Act and Anti-Terrorism Laws. Each party represents and
warrants to, and covenants with, the other party that neither it nor any of its
respective constituent owners or affiliates currently are, or shall be at any
time during the term of the Lease, as extended hereby, in violation of any laws
relating to terrorism or money laundering (collectively, the “Anti-Terrorism
Laws”), including without limitation Executive Order No. 13224 on Terrorist
Financing, effective September 24, 2001 and relating to Blocking Property and
Prohibiting Transactions With Persons Who Commit, Threaten to Commit, or Support
Terrorism (the “Executive Order”), the Uniting and Strengthening America by
Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of
2001 (Public Law 107-56) (the “USA Patriot Act”), and/or the Uniting and
Strengthening America by Fulfilling Rights and Ending Eavesdropping, Dragnet
collection and Online Monitoring Act of 2015 (the “USA Freedom Act”). Each party
covenants with the other party that neither it nor any of its respective
constituent owners or affiliates is or shall be during the term of the Lease, as
extended hereby, a “Prohibited Person,” which is defined as follows: (i) a
person or entity that is listed in the Annex to, or is otherwise subject to, the
provisions of the Executive Order; (ii) a person or entity owned or controlled
by, or acting for or on behalf of, any person or entity that is listed in the
Annex to, or is otherwise subject to the provisions of, the Executive Order;
(iii) a person or entity with whom Sublandlord is prohibited from dealing with
or otherwise engaging in any transaction by any Anti-Terrorism Law, including
without limitation the Executive Order, the USA Patriot Act and the USA Freedom
Act; (iv) a person or entity who commits, threatens or conspires to commit or
support “terrorism” as defined in Section 3(d) of the Executive Order; (v) a
person or entity that is named as a “specially designated national and blocked
person” on the then-most current list published by the U.S. Treasury Department
Office of Foreign Assets Control at its official website,
http://www.treas.gov/offices/eofffc/ofac/sdn/t11sdn.pdf, or at any replacement
website or other replacement official publication of such list; and (vi) a
person or entity who is affiliated with a person or entity listed in items (i)
through (v), above. At any time and from time-to-time during the Term, either
party shall deliver to the other party, within ten (10) days after receipt of a
written request therefor, a written certification or such other evidence
reasonably acceptable to the other party evidencing and confirming a party’s
compliance with this Section.

 

8.

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16.     Civil Code § 1938 Advisory. Sublandlord hereby notifies Subtenant that
Master Landlord has advised Sublandlord that the Building has not undergone
inspection by a Certified Access Specialist (CASp) (as defined in California
Civil Code § 55.52(a)(3)), and Sublandlord refers Subtenant to Exhibit F of the
Master Lease attached hereto relating to disability access obligations under San
Francisco Administrative Code Chapter 38.

 

17.     Miscellaneous Provisions. This Sublease shall be governed by and
construed in accordance with the laws of the State of California. This Sublease,
together with the Master Lease, constitutes the entire agreement among the
parties relating to the subject hereof and supersedes all prior understandings
between the parties relating to the subject hereof, whether written or oral. No
waiver of any rights or remedies by any party to this Sublease shall constitute
a waiver of any future or other right or remedy by that party. If any provision
of this Sublease shall be held to be invalid, void or unenforceable, the
remainder of this Sublease shall remain in full force and effect without being
affected, impaired or invalidated thereby. Nothing contained in this Sublease
shall result in any party being the agent or legal representative of any other
party for any purpose whatsoever, nor shall this Sublease be deemed to create
any form of business organization among the parties hereto. Time is of the
essence of this Sublease. This Sublease may be signed in two or more
counterparts, each of which shall be deemed an original but all of which shall
together constitute one and the same instrument. In the event of any litigation
involving the parties to this Sublease to enforce any provision of this
Sublease, to enforce any remedy available upon default under this Sublease, or
seeking a declaration of the rights of either party under this Sublease, the
prevailing party shall be entitled to recover from the other such attorneys’
fees and costs as may be reasonably incurred.

 

[SIGNATURES APPEAR ON THE FOLLOWING PAGE]

 

9.

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IN WITNESS WHEREOF, this Sublease is executed as of the date first written
above.

 

 

SUBLANDLORD:   SUBTENANT:           REC AMERICAS LLC,   ADYNXX, INC., Delaware
limited liability company   a Delaware corporation                     By: /s/
Dye-Zone Chen   By: /s/ Rick Orr           Name: Dye-Zone Chen   Name: Rick Orr
          Title: VP, Global Market Intelligence & US Business Development  
Title: CEO           Date: February 8, 2016   Date: February 5, 2016

 

10.

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EXHIBIT A

 

FLOOR PLAN SHOWING THE PREMISES

 

[image1.jpg]

 

11.

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EXHIBIT B

 

COPY OF THE MASTER LEASE

 

[See attached]

 

 

 

12.