**EXHIBIT 10.24**

 

**SEVENTH AMENDMENT TO EXPANSION LEASE**

 

THIS SEVENTH AMENDMENT TOEXPANSION LEASE (this “**Amendment**”) ismade and entered into as of the 12th day of January, 2006 by and between **ARE-11099 NORTH TORREY PINES, LLC,** aDelaware limited liability company (“**Landlord**”), and**SENOMYX, INC.**, a Delaware corporation (“**Tenant**”).

 

**RECITALS**

 

A.            HealthSciences Properties, Inc. (“**HSP**”),a predecessor-in-interest to Landlord, and Sequana Therapeutics, Inc.,doing business as AXYS Pharmaceuticals, Inc. (“**Original Tenant**”), are parties to that certain Expansion Leasedated November 20, 1995, as amended by that certain letter agreement datedNovember 20, 1995, between HSP and Original Tenant, that certain FirstAmendment to Expansion Lease dated October, 1996, between HSP and OriginalTenant, that certain Second Amendment to Expansion Lease dated May 20,1997, between Alexandria Real Estate Equities, Inc. (“**ARE**”), formerly known as HSP, and OriginalTenant, that certain Third Amendment to Expansion Lease dated August 24,1998, between Landlord, successor-in-interest to ARE, and Original Tenant, thatcertain Fourth Amendment to Expansion Lease dated March 31, 1999, betweenLandlord and Original Tenant, that certain Fifth Amendment to Expansion Leasedated October, 1999, between Landlord and Original Tenant, as assigned pursuantto that certain Assignment and Assumption of Lease dated July 12, 2000,between Tenant and Original Tenant, and as further amended by that certainConsent to Assignment dated July 12, 2000 by and among Landlord, Tenantand Original Tenant, those certain letter agreements dated March 30, 2001,and August 31, 2001, between Landlord and Tenant and that certain SixthAmendment to Expansion Lease dated April 27, 2002, between Landlord andTenant (collectively, the “**Lease**”).

 

B.            Pursuantto the terms of the Lease, Tenant leased from Landlord the Demised Premises ina building located at 11099 North Torrey Pines Road, La Jolla, California, andmore particularly described in the Lease. All capitalized terms not otherwise defined herein shall have themeanings set forth in the Lease unless the context clearly indicates otherwise.

 

C.            Tenantcurrently subleases portions of the Premises to certain subtenants whosesublease rights and interests have been consented to by Landlord (collectively,the “**Subtenants**”).

 

D.            ARE-NexusCentre II, LLC and Tenant are negotiating a lease (the “**Nexus Centre Drive Lease**”) for certainpremises located on the property commonly known as 4767 Nexus Centre Drive, SanDiego, California.

 

E.             Landlordand Tenant now desire to amend the Lease on the terms and conditions set forthherein.

 

NOW, THEREFORE, for goodand valuable consideration, the receipt and sufficiency of which are herebyacknowledged, and the mutual covenants contained herein, the parties herebyagree as follows:

 

# 1.             EffectiveDate.

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## a.     The effectiveness of this Amendment shallbe subject to the execution of the Nexus Centre Drive Lease (the “**Nexus Centre Drive Lease Condition**”) andthe satisfaction of the Nexus Centre Drive Lease Condition shall be a conditionprecedent to the effectiveness of this Amendment.  If the parties do not execute the NexusCentre Drive Lease, this Amendment shall be null and void and shall be of noforce or effect.  The “**Effective Date**” shall be deemed to be thedate on which the Nexus Centre Drive Lease Condition is satisfied.

 

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# 2.             Amendmentsto Lease.

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## a.     Landlord hereby consents to Tenant’scontinuing in possession of the Demised Premises following expiration of theterm of the Lease on December 31, 2006 in accordance with Section 12.1of the Lease.  Notwithstanding theforegoing or anything in the Lease to the contrary:  (i) Tenant shall not be liable for BasicAnnual Rent or Tenant’s Pro Rata Share of Operating Expenses during the periodcommencing upon January 1, 2007 and ending upon February 28, 2007(the “**Restoration Period**”) and (ii) followingthe expiration of the Restoration Period, Basic Annual Rent and Tenant Pro RataShare of Operating Expenses shall once again be payable except that BasicAnnual Rent shall be at a monthly rental rate equal to the monthly rental ratepayable under the Lease for the month of December 2006 (and not subject tofurther increase as otherwise provided for in Section 12.1 of theLease).  The expiration of theRestoration Period shall be extended on a day for day basis to the extent ofthe occurrence of any “Force Majeure Delays” or “Landlord Delays” (as thoseterms are defined in the Nexus Centre Drive Lease) under the Nexus Centre DriveLease.  In addition to the aforementionedextension of the Restoration Period, if Tenant terminates the Nexus CentreDrive Lease after January 1, 2008 pursuant to Section 2(e) thereof,the Restoration Period shall expire as of the date which is six (6) monthsfollowing the effective date of the termination of the Nexus Centre DriveLease.

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## b.     During the Restoration Period, Tenantshall cause the Demised Premises to be restored to the condition required underthe Lease as modified by this Amendment. In addition to Tenant’s surrender obligations relating to the conditionof the Demised Premises under the Lease and any obligations of Tenant whichexpressly survive the termination of the Lease, Tenant’s surrender obligationsshall include:  (i) Tenant’sperformance of its surrender obligations relating to the removal of anyHazardous Materials introduced into the Demised Premises by Tenant or underTenant’s auspices, as set forth in the Surrender Plan attached hereto as Exhibit A,(ii) the capping of any Building systems affected by Tenant’s removal ofany personal property or equipment and (iii) Tenant’s vacating the DemisedPremises with all of Tenant’s personal property removed, and in a broom-cleancondition, but otherwise in its “as-is” condition at the time of the EffectiveDate, subject to normal wear and tear (collectively, the “**RestorationObligations**”). Notwithstanding the foregoing or the Lease, Tenant shall not beobligated to (and the Restoration Obligations shall not include any requirementto):  (A) paint or patch the wallsof the Demised Premises, (B) replace any worn or spotted carpeting orother flooring materials, (C) replace any discolored ceiling tiles, (D) removeany existing improvements or alterations made by Tenant to the DemisedPremises, (E) repair any defective lighting fixtures, electrical circuitryor equipment or (F) except as provided in clause (ii) of thepreceding sentence, correct any defects in the Building mechanical,ventilation, plumbing or sewer systems. To the extent of any conflict between Tenant’s surrender obligationsunder the Lease and Tenant’s surrender obligations under this Amendment, thesurrender obligations under this Amendment shall control.

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## c.     Notwithstanding anything to the contrary,the Lease shall terminate when the Restoration Obligations are Complete (asherein defined).  When Tenant believesthat the Restoration Obligations have been completed in accordance with theterms hereof, Tenant shall give written notice thereof (the “**Completion Notice**”) to Landlord.  Landlord shall have the right toindependently determine whether the Restoration Obligations have been completedin accordance with the terms hereof.  IfLandlord, in Landlord’s reasonable discretion, determines that the RestorationObligations have not been completed in accordance with the terms hereof,Landlord may, within ten (10) business days following Landlord’s receiptof the Completion Notice, provide notice to Tenant of such determinationdescribing in reasonable detail why Landlord does not believe the RestorationObligations have been completed in accordance with the terms hereof (a “**Disapproval Notice**”). If Landlord gives a Disapproval Notice to Tenant:  (i) Tenant shall continue to beobligated to complete the Restoration Obligations in accordance with the termshereof, (ii) the Lease shall continue until the Restoration Obligationsare completed, (iii) Tenant shall again be obligated to provide aCompletion Notice when it believes the Restoration Obligations have beencompleted in accordance with the terms hereof and (iv) the proceduredescribed herein shall continue to be repeated until the RestorationObligations are Complete.  For purposeshereof the Restoration Obligations shall be deemed “**Complete**”upon Tenant’s provision of a Completion Notice to Landlord that Landlord doesnot timely respond to with the provision of a Disapproval Notice.

 

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## d.     Notwithstanding anything to the contrary,Tenant’s performance of the Restoration Obligations pursuant to this Amendmentis subject to Landlord’s and Tenant’s mutual understanding that the Premiseswill be surrendered by Tenant free of the Subtenants and their personalproperty upon the expiration of the Lease. Therefore, Landlord hereby agrees that in the event Landlord enters intoan agreement directly with any of the Subtenants whereby Landlord consents tothe occupancy of any portion of the Premises by a Subtenant after theexpiration of the Restoration Period (a “**Direct Agreement**”),then Tenant shall be released from performance of the Restoration Obligationswith respect to that portion of the Premises occupied by the Subtenant who is aparty to a Direct Agreement (a “**Successor Tenant**”)unless such Successor Tenant vacates the Premises prior to the commencement ofthe Restoration Period.  Additionally,the continued occupancy of the Premises after the expiration of the RestorationPeriod by any Successor Tenant pursuant to a Direct Agreement shall (i) notbe deemed a holdover by Tenant, and (ii) be deemed Landlord’s acceptanceof the portion of the Premises occupied by the Successor Tenant in thecondition required under the relevant terms and conditions of the Lease for theeffective surrender thereof, including, without limitation, its environmentalcondition.  The entry of Landlord intoany Direct Agreement shall be in Landlord’s sole and absolute discretion.

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## e.     Tenant’s Option under Section 45 ofthe Lease to extend the term of the Lease for an additional period of five (5) yearsshall terminate and be of no further force or effect.

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# 3.             Representationsand Warranties.

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## a.     As a material inducement to Landlord toenter into this Amendment, Tenant represents and warrants to Landlord that, asof the date of date hereof:

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### (1)   The Lease is in full force and effect.There are no defaults by Tenant under the Lease, and no circumstance hasoccurred which, but for the expiration of an applicable grace period, wouldconstitute an event of default by Tenant under the Lease.  To Tenant’s knowledge, there are no defaultsby Landlord under the Lease, and no circumstance has occurred which, but forthe expiration of an applicable grace period, would constitute an event ofdefault by Landlord under the Lease.  ToTenant’s knowledge, Tenant has no defenses or rights of offset under the Lease.

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### (2)   Tenant is the sole lawful tenant underthe Existing Lease, and Tenant has not sublet, assigned, conveyed, encumberedor otherwise transferred any of the right, title or interest of Tenant underthe Lease or in the Demised Premises, other than the subleases with Subtenantswhose sublease rights and interests have been expressly consented to in writingby Landlord.

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### (3)   Tenant is a duly formed and existingentity qualified to do business in the State of California.  Tenant has full right and authority toexecute and deliver this Amendment and each person signing on behalf of Tenantis authorized to do so and no consent of any party is required on behalf ofTenant for this Amendment to be in full force and effect.

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# 4.             Miscellaneous.

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## a.     This Amendment shall be deemed to havebeen executed and delivered within the Sate of California, and the rights andthe obligations of the parties hereto shall be construed and enforced inaccordance with, and governed by, the laws of the State of California.

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## b.     This Amendment is the entire agreementbetween the parties with respect to the portions of the Lease amended herebyand supersedes all other prior and contemporaneous oral and written agreementsand any discussions between the parties hereto relating to the mattersexpressly set forth herein.  The Lease asamended by this Amendment may be further amended only by an agreement inwriting, signed by Landlord and Tenant.

 

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## c.     This Amendment is binding upon and shallinure to the benefit of the parties hereto, their respective agents, employees,representatives, officers, directors, divisions, subsidiaries, affiliates,assigns, heirs, successors in interest and shareholders.

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## d.     Each party has cooperated in the draftingand preparation of this Amendment. Hence, in any construction to made of this Amendment, the same shall notbe construed against either party hereto.

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## e.     Each term of this Amendment is contractualand not merely a recital.

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## f.      This Amendment may be executed incounterparts, and when each party has signed and delivered at least one suchcounterpart, each counterpart shall be deemed an original and, when takentogether with other signed counterparts, shall constitute one Amendment, whichshall be binding upon and effective as to all parties.

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## g.     The unenforceability of a portion of thisAmendment or the Nexus Centre Drive Lease shall not affect the enforceabilityof either the remainder of this Amendment or the Nexus Centre Drive Lease.

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## h.     The parties will execute all such furtherand additional document as shall be reasonable, convenient, necessary ordesirable to carry out the provisions of this Amendment; provided that theforegoing shall not be deemed a commitment by either party to enter into theNexus Centre Drive Lease, the effect of which failure is addressed in Paragraph1.a above, and shall not be a breach of this Amendment.

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## i.      This Amendment and the Lease shall beconstrued as a whole in order to effectuate the intent of the parties to amendthe Lease in the manner specified in this Amendment.  All provisions of the Lease affected by thisAmendment shall be deemed amended regardless of whether so specified in thisAmendment.  Subject to the foregoing, ifany provision of the Lease conflicts with any provision of this Amendment, theprovision of this Amendment shall control.

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## j.      Except as specifically amended ormodified by this Amendment, the Lease remains in full force and effect.

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## k.     EACH PARTY ACKNOWLEDGES THAT IT HAS HADADEQUATE OPPORTUNITY TO CONSULT WITH LEGAL COUNSEL OF ITS CHOOSING INCONNECTION WITH THE EXECUTION HEREOF AND HAS DONE SO, OR VOLUNTARILY ELECTEDNOT TO DO SO.

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IN WITNESS WHEREOF, theparties have executed this Amendment as of the date first hereinabove setforth.

 
|       | **LANDLORD**:                           |
|------------|-----------------------------------------|
|       |                                    |
|       | **ARE-11099  NORTH TORREY PINES, LLC**, |
|       | a Delaware  limited liability company   |
|       |                                    |
|       | By:                                     | Alexandria Real  Estate Equities, Inc., |
|       |                                    | a Maryland  corporation, managing member |
|       |                                    |   |
|       |                                    |   |
|       |                                    | By: | /s/ Jennifer  Pappas |   |
|       |                                    |   |   |   |
|       |                                    | Its: | V.P. and  Assistant Secretary |   |
|       |                                    |   |
|       | **TENANT:**                             |
|       |                                    |
|       | **SENOMYX,  INC.,**                     |
|       | a Delaware  corporation                 |
|       |                                    |
|       |                                    |
|       | By:                                     | /s/ Kent Snyder |   |
|       |                                    |   |   |
| ** ** | Its:                                    | Chief Executive Officer |   |
|            |                                         |  |  |  |  |  |

 

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**EXHIBIT A**

 

**SURRENDER PLAN, 11099 North Torrey Pines Rd.**

 

1.     Tenant’s environmental contractor (“Contractor”) will prepare and send awritten 30-day advance notice to Department of Health Services, RadiologicalHealth Branch in Sacramento, CA regarding Intent to Vacate facility along withform RH 5314, Certificate of Disposition of Materials.  Landlord hereby consents to the hiring ofOccupational Services, Inc. as the Contractor; any change of Contractorshall require Landlord’s approval, which approval shall not be unreasonablywithheld conditioned or delayed.

 

Contractorwill survey benches, floors, sinks, work areas, fume hoods, and storage areasin the radiation laboratories that are to be closed-out using appropriatesurvey instruments to determine if fixed contamination is present. Contractorwill use large area gas proportional detectors for beta emitting radionuclidesand a low energy gamma scintillation probe for I-125. Contractor will thencollect an estimated 1,000 wipe test samples from the laboratory surfaces,including sinks, benches, floors, return air vents, floor drains and adjacenthallways, to determine if removable surface contamination is present. Wipe testsamples will be analyzed at Contractor’s counting laboratory using Contractor’sBeckman model LS 6000SE liquid scintillation counter calibrated with NISTtraceable H-3 and C- 14 reference sources and Contractor’s Gamma Countercalibrated with an I-125 reference source. The counting results will bereported in units of dpm/100 cm2.

 

Contractorwill report locations of elevated contamination to Tenant. A “location ofelevated contamination” is an area where removable or fixed contamination isgreater than the Minimum Detectable Concentration (MDC) of our instruments.Contractor will retest and resurvey the “locations of elevated contamination”to verify adequate decontamination. The closeout survey, and accompanyingreport that documents the survey, will include the physical survey of the site,preparation of the wipes for LSC and Gamma counting, preparation of the licenseamendment request with survey report (~35 page document including datasheets) and review by a senior Contractor Health Physicist.

 

Theamendment application and final termination report will be prepared accordingto guidelines contained in:

 

•      NUREG 1507, Minimum Detectable Concentrations with Typical RadiationSurvey Instruments for Various Contaminants and Field Conditions(http://techconf.llnl.gov/radcri/1507.html)

•      MARSSIM, the Multi-Agency Radiation Survey and Site InvestigationManual. (http://www.epa.gov/radiation/marssim/)

 

Areaswith elevated contamination will be cleaned by Contractor.  The cleaned area will be resurveyed byContractor to confirm that elevated contamination has been removed by thecleaning.

 

Contractorwill prepare a detailed written amendment to Tenant’s RML requesting theaddition of Tenant’s new facility. The amendment will include electronic mapsdemarcating the radioactive materials receipt, package open, use, storage, anddisposal locations (decay in storage and isotope disposal sinks). We willinclude detailed tables listing each room name and room number to be listed onthe license. We will include new sewer release limits on discharges to thesanitary sewer.

 

2.     Contractor will chemically decontaminate Tenant’s biological safetycabinets and incubators with paraformaldehyde before they are moved orshipped.  The decontamination procedureswill 

 

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adhere to the NSF 49Standard. Contractor will start the work in the evening, between 4:00 p.m.– 6:00 p.m.

 

Thedecontamination process takes approximately 14 hours, during which the cabinetswill be encapsulated with plastic sheeting and duct tape. **No persons****are permitted to enter the entire suite during the decontamination****process**.  There will be no human access into the suiteuntil Contractor returns the following morning to remove the encapsulation andneutralize the agent. At that time the decontamination process is complete andpersons may enter the suite.

 

3.     Contractor will biologically decontaminate Tenant’s walk-in cold rooms.Contractor will issue a signed certificate of decontamination for each walk-incold room. The walk-in cold rooms will be sprayed down with Sporicidin, aregistered disinfectant and cleaner and then fogged with Actril® ColdSterilant.

 

4.     Contractor will wipe down the chemical fume hoods once empty. Only theaccessible portions of fumehoods (not ducting or fans) will be cleaned.Inaccessible areas (i.e., the plenums and duct work above the fume hood) willnot be cleaned. Contractor will issue signed certificates documenting thecleaning. Contractor is not conducting confirmatory sampling after cleaning toverify the fume hoods are completely free of hazardous substances.

 

5.     Contractor will wipe down the flammable liquid, acid, base, and chemicalcabinet storage cabinet once they are empty.

 

6.     Contractor will issue signed certificates documenting the cleaning.Contractor is not conducting confirmatory sampling after cleaning to verify thecabinets are completely free of hazardous substances.

 

7.     Contractor will contact vendors, conduct site walk, and obtain quotesfrom qualified vendors for the transportation and disposal of chemicals.

 

8.     Contractor will request gas supplier(s) to pick up compressed gascylinders from facility.

 

9.     Contractor will contact biohazardous waste hauler and have biohazardousmaterials and biohazardous waste disposed of using a registered hauler.

 

10.   Contractor will physically verify that containers of hazardous materialshave been disposed of from the site.

 

11.   Contractor will perform the following steps associated with Tenantlicenses and permitting agreements for 11099 NTP:

 

•      Send letter to the agency to terminate the San Diego IndustrialWastewater permit, and attend final inspection, if conducted by regulator.

 

•      Send letter to the agency to terminate the San Diego County HealthDepartment permit and attend final inspection, if conducted by regulator.

 

•      Send letter to the agency to terminate the EPA Hazardous WasteIdentification Number and attend final inspection, if conducted by regulator.

 

•      Send letter to the agency to terminate the San Diego Fire DepartmentPermit and attend final inspection, if conducted by regulator.

 

•      If follow up correspondence is required by the Radiological HealthBranch in Sacramento, CA after the initial amendment is submitted, the timespent preparing the response letter will be invoiced at Contractor’s hourlyrate and will be paid for entirely by Tenant.

 

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12.   Tenant will contract a janitorial contractor to conduct cleaning so thatthe building is “broom clean”.

 

13.   Tenant shall provide a written report of Contractor documenting that allmeasures required herein have been completed in accordance with therequirements hereof.

 

14.   Tenant and its Contractor shall participate in any measures taken byLandlord to verify the performance of the aforementioned surrenderrequirements, including but not limited to, phone interviews and site visits.

 

15.   Tenant shall remain liable for all of the obligations and requirementsset forth herein notwithstanding its hiring of the Contractor.

 

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