EXHIBIT 10.2




                                FACILITIES LEASE

                                     BETWEEN

                          CEDARS-SINAI MEDICAL CENTER,

                       A CALIFORNIA NONPROFIT CORPORATION

                                       AND

                ARBIOS TECHNOLOGIES, INC., A DELAWARE CORPORATION



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ARTICLE I        BASIC LEASE PROVISIONS....................................................................................1


ARTICLE II       DESCRIPTION OF PREMISES...................................................................................2


ARTICLE III      TERM; COMMENCEMENT DATE...................................................................................2


ARTICLE IV       RENT......................................................................................................2

           4.1.  Basic Annual Rent.........................................................................................2
           4.2.  Basic Annual Rent Increase................................................................................3
           4.3.  Additional Rent...........................................................................................4
                 4.3.1         Payment.....................................................................................4
                 4.3.2         Taxes and Capital Improvements..............................................................4
                               (a)     Definitions.........................................................................4
                               (b)     Adjustments to Rent - Operating Expenses and Real Property Taxes....................5
                               (c)     Adjustments to Rent for Capital Improvements........................................6
                               (d)     Additional Taxes and/or Improvements................................................6
                               (e)     Landlord's Statement................................................................7
                 4.3.3         Charges for Use of Specialized Research Cores...............................................8
           4.4.  Definitions...............................................................................................8
                 4.4.1         Lease Years: Calendar Years.................................................................8
                 4.4.2         Lease Rate..................................................................................8
           4.5.  Miscellaneous Rent Provisions.............................................................................8
                 4.5.1         Prorations..................................................................................8
                 4.5.2         Place and Manner of Payment.................................................................9
                 4.5.3         Conditional Payment.........................................................................9
           4.6.  Security Deposit..........................................................................................9

ARTICLE V        TAXES ON TENANT'S PROPERTY................................................................................9


ARTICLE VI       USE OF PREMISES..........................................................................................10

           6.1.  Limitation of Use........................................................................................10
           6.2.  Compliance with Governmental and Insurance Regulations...................................................11
           6.3.  Assumption of Risk of Noncompliance......................................................................11
           6.4.  Safety Training Program..................................................................................12
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           6.5.  Use of Common Services Space.............................................................................12
           6.6.  Animal Research..........................................................................................12

ARTICLE VII      CONSTRUCTION AND MAINTENANCE OF PREMISES AFTER INITIAL CONSTRUCTION......................................12

           7.1.  Maintenance of Premises..................................................................................12
           7.2.  Tenant Construction......................................................................................12
                 7.2.1         Landlord's Consent.........................................................................12
                 7.2.2         Licensed Contractors.......................................................................13
                 7.2.3         Construction Requirements..................................................................13
           7.3.  Condition of Premises....................................................................................14
           7.4.  Landlord Repairs and Maintenance After Commencement Date.................................................14

ARTICLE VIII     MECHANICS' LIENS.........................................................................................15


ARTICLE IX       COMMON AREAS AND SPECIALIZED RESEARCH CORES..............................................................15

           9.1.  Common Areas.............................................................................................15
           9.2.  Specialized Research Cores...............................................................................16

ARTICLE X        LANDLORD'S RIGHT OF ACCESS...............................................................................16


ARTICLE XI       PROPERTY DAMAGE AND PERSONAL INJURY CLAIMS...............................................................17

           11.1. Indemnification..........................................................................................17
           11.2. Assumption of Liability and Waiver of Claims.............................................................17

ARTICLE XII      INSURANCE................................................................................................18

           12.1. Tenant's Insurance Obligations...........................................................................18
                 12.1.1        Liability Insurance........................................................................18
                 12.1.2        Property Insurance.........................................................................18
                 12.1.3        Workers' Compensation Insurance............................................................18
                 12.1.4        Other Insurance............................................................................19
                 12.1.5        Policy Provisions..........................................................................19
           12.2. Landlord's Insurance Obligations.........................................................................19
           12.3. Waivers of Subrogation...................................................................................19
           12.4. Increases................................................................................................20
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ARTICLE XIII     DAMAGE OR DESTRUCTION OF BUILDING OR PREMISES............................................................20

           13.1. Repair; Termination......................................................................................20
           13.2. Abatement of Rent........................................................................................20
           13.3. Waiver...................................................................................................20

ARTICLE XIV      EMINENT DOMAIN...........................................................................................21


ARTICLE XV       ASSIGNING MORTGAGING SUBLETTING CHANGE IN OWNERSHIP......................................................21

           15.1. No Unauthorized Transfer.................................................................................21
           15.2. Procedures for Requesting Authorization..................................................................22
           15.3. Landlord's Option........................................................................................22
           15.4. Conditions to Consent....................................................................................22
                 15.4.1        Standards of Reasonableness................................................................22
                 15.4.2        Further Transfers..........................................................................23
                 15.4.3        Rent or Other Premiums.....................................................................23
                 15.4.4        Processing Costs and Fees..................................................................23
                 15.4.5        No Waiver..................................................................................23
                 15.4.6        Nature of Tenant...........................................................................23

ARTICLE XVI      SUBORDINATION; ATTORNMENT................................................................................24

           16.1. Subordination............................................................................................24
           16.2. Attornment...............................................................................................24
           16.3. Attorney-in-Fact.........................................................................................24
           16.4. Non-Disturbance..........................................................................................24

ARTICLE XVII     DEFAULT..................................................................................................25

           17.1. Default by Tenant........................................................................................25

ARTICLE XVIII    REMEDIES.................................................................................................26

           18.1. Termination of Lease and Removal of Tenant...............................................................26
           18.2. Damages..................................................................................................26
           18.3. No Effect on Indemnification.............................................................................27
           18.4. No Acceptance of Surrender...............................................................................27
           18.5. Action for Rent..........................................................................................27
           18.6. Definition of Rent.......................................................................................27
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           18.7. Reletting................................................................................................27
           18.8. Cumulative Remedies......................................................................................28
           18.9. Assignment of Subrents...................................................................................28
           18.10.Storage of Personal Property.............................................................................29
           18.11.Waiver...................................................................................................29
           18.12.Landlord's Cure of Tenant's Default......................................................................29
           18.13.Interest and Charges on Past Due Obligations.............................................................29

ARTICLE XIX      RULES AND REGULATIONS....................................................................................29


ARTICLE XX       SURRENDER OF PREMISES....................................................................................30

           20.1. Surrender................................................................................................30
           20.2. No Merger................................................................................................30

ARTICLE XXI      HOLDING OVER.............................................................................................30


ARTICLE XXII     NOTICES..................................................................................................31


ARTICLE XXIII    QUIET ENJOYMENT..........................................................................................32


ARTICLE XXIV     ESTOPPEL CERTIFICATE.....................................................................................32


ARTICLE XXV      LIABILITY OF LANDLORD....................................................................................32


ARTICLE XXVI     LANDLORD'S INABILITY TO PERFORM..........................................................................33


ARTICLE XXVII    ATTORNEYS' FEES..........................................................................................33


ARTICLE XXVIII   SERVICES.................................................................................................33

           28.1. Provision of Services....................................................................................33
           28.2. Interruption of Services.................................................................................33
           28.3. Compliance with Service Related Regulations..............................................................34
           28.4. Additional Building Service Demands......................................................................34
           28.5. Modification of Services.................................................................................34
           28.6. Special Services.........................................................................................35

ARTICLE XXIX     GENERAL PROVISIONS.......................................................................................35

           29.1. Headings.................................................................................................35
           29.2. Plurals and Genders......................................................................................35
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           29.3. "Persons" Defined........................................................................................35
           29.4. Covenants and Agreements: Time of the Essence............................................................35
           29.5. Successors and Assigns...................................................................................35
           29.6. Interpretation...........................................................................................35
           29.7. Waiver and Default.......................................................................................35
           29.8. Entire Agreement; Amendments.............................................................................36
           29.9. Landlord's Consent or Approval...........................................................................36
           29.10.Counterparts.............................................................................................36
           29.11.Applicable Law and Venue.................................................................................36
           29.12.Incorporation of Exhibits................................................................................37
           29.13.Reserved Area............................................................................................37
           29.14.Brokers..................................................................................................37
           29.15.No Option................................................................................................37
           29.16.Authority................................................................................................37
           29.17.Recordation of Lease.....................................................................................37
           29.18.Multiple Parties.........................................................................................38
           29.19.No Violation of Other Agreements.........................................................................38
           29.20.Adjacent Land............................................................................................38
           29.21.Building Directory.......................................................................................38
           29.22.Parking..................................................................................................38
           29.23.Subdivision; Mutual Cooperation..........................................................................39
           29.24.Name of Building.........................................................................................39
           29.25.Rental Abatement.........................................................................................39
           29.26.Guarantees...............................................................................................39
           29.27.Severability.............................................................................................39
           29.28.Waiver of Rights of Redemption...........................................................................39
           29.29.Light and Air............................................................................................39
           29.30.No Joint Venture.........................................................................................39

ARTICLE XXX      HAZARDOUS MATERIALS......................................................................................40

           30.1. Compliance Costs.........................................................................................40
           30.2. Definition...............................................................................................40
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EXHIBITS

Exhibit A            Building Site Plan
Exhibit B            Floor Plan
Exhibit C            Monthly Rent Calculation
Exhibit D            Permitted Uses
Exhibit E            Rules and Regulations
Exhibit F            Trade Fixtures
Exhibit G            Special Services


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                                FACILITIES LEASE

      THIS  FACILITIES  LEASE  ("Lease") is made and entered into as of June 30,
2001,  by and  between  CEDARS-SINAI  MEDICAL  CENTER,  a  California  nonprofit
corporation  ("Landlord"),  and  ARBIOS  TECHNOLOGIES,   INC.  ("Tenant"),  with
reference to the following facts and circumstances:

      A. Landlord is the owner of a building  ("Building") located at 110 George
Burns Road, Los Angeles, California. The land upon which the Building is located
is  hereinafter  referred  to as the  "Property."  A  site  plan  depicting  the
Building, related improvements and the Property (collectively, the "Project") is
attached hereto as EXHIBIT A.

      B.  Landlord  desires to lease certain space within the Building to Tenant
and Tenant  wishes to lease such space within the  Building  from  Landlord,  in
accordance with the terms and conditions stated herein.

      C. Tenant is leasing  certain space within the Building for the purpose of
conducting Biomedical Activities.

      NOW, THEREFORE,  for mutual consideration,  the receipt and sufficiency of
which are hereby acknowledged, Landlord and Tenant hereby agree as follows:

                                   ARTICLE I

                             BASIC LEASE PROVISIONS

      Wherever  referred  to in this  Lease,  and  subject  to  modification  or
revision by particular  terms and conditions of this Lease and Addenda  thereto,
these certain basic lease provisions are defined as follows:

      1.1 Tenant: ARBIOS TECHNOLOGIES, INC.

      1.2 Building: 110 George Burns Road.

      1.3 Premises Area: 1,008 total rentable square feet, consisting of:

            1.3.1 Suite *  ("Premises"),  consisting of ** rentable square feet;
                  and * 4094-G, 4089, 4087 **794 sq.ft.

            1.3.2  Tenant's  share of the gross  square  feet  contained  in the
Common  Services  Space and the Common Areas of the Building,  which shall be an
additional  twenty-seven  percent (27%) of the total rentable square feet of the
"Premises" described in Section 1.3.1 above.

      1.4 Commencement Date:            July 1, 2001

      1.5 Termination Date:             June 30, 2004

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      1.6 Permitted Uses: Biomedical Activities, as set forth in Section 6.1 and
more particularly described in EXHIBIT D.

      1.7 Basic Annual Rent:  $42,336.00,  payable in twelve (12) equal  monthly
installments of $3,528.00 , beginning on the Commencement Date and continuing on
the first day of each subsequent calendar month.

      1.8 Basic Annual Rent Increase: Effective on each and every anniversary of
the Commencement Date, pursuant to Section 4.2.

      1.9 Additional Rent: As set forth in Section 4.3.

      1.10 Security Deposit: $7,056.00 .

      1.11 Parking Allotment: See Section 29.22 hereof

                                   ARTICLE II

                             DESCRIPTION OF PREMISES

      Subject to the terms and conditions stated herein,  Landlord hereby leases
to Tenant, and Tenant hereby leases from Landlord certain premises consisting of
the space  ("Premises")  designated  as Suite * . The  "Premises  Area" for such
Premises  shall mean and consist of 1,008 rentable  square feet,  consisting of:
(a) the total  rentable  square feet within the  Premises  described  in Section
1.3.1  hereof,  plus  (b)  Tenant's  share of the  space  described  in,  and as
determined  pursuant to,  Section  1.3.2 hereof A floor plan for the Premises is
attached hereto as EXHIBIT B. Tenant  acknowledges  that it has investigated the
Premises  prior to the  execution  hereof and agrees  that the  rentable  square
footage of  Premises  Area for  purposes of this Lease is not less than that set
forth above and that Tenant shall be  irrevocably  bound by the  designation  of
rentable  square  footage of the Premises Area set forth above.  For purposes of
this  Agreement,  the "Common  Services  Space" shall mean those portions of the
floor on which the  Premises  is  located  which are marked as such on EXHIBIT B
attached hereto.

*4094-G, 4087, 4089

                                  ARTICLE III

                             TERM; COMMENCEMENT DATE

      The term of this  Lease  shall  commence  on July 1,  2001  ("Commencement
Date"). The term of this Lease ("Term") shall be three (3) years commencing with
the  Commencement  Date,  unless sooner  terminated  pursuant to the  provisions
hereof.

                                   ARTICLE IV

                                      RENT

      4.1 Basic Annual Rent. Tenant shall pay to Landlord during the Term hereof
basic annual rent in twelve equal monthly installments, each monthly installment
equal to the product of (a) the total  rentable  square  footage of the Premises
Area,  multiplied  by (b) Three  Dollars And Fifty Cents Only ($3.50) per square
foot per month,  as adjusted  from time to time  pursuant to



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Section 4.2 hereof. The basic annual rent as adjusted from time to time pursuant
to Section 4.2 hereof is referred to  hereinafter  as the "Basic  Annual  Rent".
Concurrently with the execution of this Lease,  Tenant shall pay to Landlord the
first  monthly  installment  of Basic  Annual  Rent.  Thereafter,  each  monthly
installment  of Basic Annual  Rent,  as adjusted  from time to time  pursuant to
Section 4.2 hereof,  shall be due and payable by Tenant to Landlord on the first
day of each calendar month during the Term of the Lease.

      4.2 Basic Annual Rent Increase.

            4.2.1 On each  anniversary  ("Adjustment  Date") of the Commencement
Date,  commencing with the first anniversary of the Commencement Date, the Basic
Annual Rent shall be increased  by  multiplying  such Basic  Annual  Rent,  by a
fraction,  the numerator of which shall be the CPI (as hereinafter  defined) for
the calendar month in which the Adjustment  Date falls,  and the  denominator of
which shall be (a) the CPI for the calendar  month of the  Commencement  Date in
the case of the first  adjustment on the first  anniversary of the  Commencement
Date,  and (b) in the case of all other  adjustments,  the CPI for the  calendar
month one year prior to the Adjustment  Date for which the rental  adjustment is
then being calculated.  (Such fraction shall never be less than one.) The sum so
calculated or set shall constitute the new Basic Annual Rent hereunder,  but, in
no event,  shall such new Basic  Annual Rent be less than the Basic  Annual Rent
payable for the annual period  immediately  receding the  Adjustment  Date.  For
purposes hereof,  "CPI" shall mean the United States Department of Labor Revised
Consumer Price Index,  Not  Seasonally  Adjusted,  Los  Angeles-Riverside-Orange
County,  CA  metropolitan  area for  Medical  Care (Base  Period  1982/84 = 100)
established monthly by the Bureau of Labor Statistics.

            4.2.2 In the event the  compilation  and/or  publication  of the CPI
shall be transferred to any other governmental department or bureau or agency or
shall be  discontinued,  then the index most nearly the same as the CPI shall be
used to make such  calculations.  In the event that  Landlord and Tenant  cannot
agree on such alternative index, then the matter shall be submitted for decision
to the American  Arbitration  Association  in accordance  with the then rules of
such  association and the decision of the arbitrators  shall be binding upon the
parties.

            4.2.3 Tenant shall continue to pay the Basic Annual Rent at the rate
previously in effect until the increase, if any, is determined.  Within five (5)
days  following the date on which an increase is  determined,  Tenant shall make
such payment to Landlord as will bring the increased rental current,  commencing
with  the  effective  date of  such  increase  through  the  date of any  rental
installments  then due,  plus accrued  interest at the rate of ten percent (10%)
per annum from the applicable Adjustment Date. Thereafter, the Basic Annual Rent
shall be paid at the increased rate.

            4.2.4 At such time as the amount of any change in Basic  Annual Rent
required by this Lease is known or determined, Landlord and Tenant shall execute
a statement setting forth such change, but the enforceability of both this Lease
and the increase in Basic Annual Rent shall not be affected  should either party
fail or refuse to execute such statement.


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      4.3 Additional Rent.

            4.3.1  Payment.  In addition to the Basic Annual Rent,  Tenant shall
pay such  additional rent and all other amounts or charges as may be required in
this Lease.  The Basic Annual Rent and said  additional  rent and other payments
are  sometimes  collectively  referred to herein as the "rent" The rent shall be
payable to Landlord,  without demand,  deduction or offset of any kind in lawful
money of the United  States of America at the address for  Landlord set forth in
this Lease or to such other  person or at such other place as Landlord  may from
time to time  designate  in writing.  If Tenant  shall pay any rent with a check
which is not a  cashier's  check,  the check  shall be drawn  against an account
maintained in a bank or other  financial  institution  which has a branch office
located in Los Angeles, California.

            4.3.2 Taxes and Capital Improvements.

            (a) Definitions. For purposes of this Section 4.3.2 and this Lease:

                  (i)  "Operating  Expenses"  shall mean the total of all actual
costs,  expenses,  and  disbursements  for or in connection  with the operation,
management,  maintenance,  protection,  remediation,  servicing or repair of the
Project (or any portion thereof). Operating Expenses shall include: (1) the cost
of providing,  managing, operating,  maintaining and repairing air-conditioning,
electricity,  steam, heating,  mechanical,  ventilation,  escalator and elevator
systems and all other utilities  generally  supplied to all Tenants and the cost
of supplies and equipment and  maintenance  and service  contracts in connection
therewith;  (2) the  cost  of  repairs,  general  maintenance,  cleaning,  trash
removal,  telephone service, security service and janitorial service, light bulb
and tube  replacement  and supplies;  (3) the cost of fire,  extended  coverage,
boiler,  sprinkler,   apparatus,   public  liability,   property  damage,  rent,
earthquake  and other  insurance;  (4) wages,  salaries  and other  labor  costs
including taxes, insurance, retirement, medical and other employee benefits; (5)
fees, charges and other costs, including management fees, consulting fees, legal
fees and accounting fees, of all independent  contractors engaged by Landlord or
charged by Landlord if Landlord  performs such  services in connection  with the
Project;  (6) the fair market rental value of any offices in the Building (or in
other  buildings on the  Landlord's  campus) used for management of the Project;
(7) the cost of business  licenses  and similar  taxes;  (8) fees imposed by any
federal, state or local government for fire and police protection, trash removal
or other similar service; (9) any charges which are payable by Landlord pursuant
to any type of service agreement or a functional equivalent with the City of Los
Angeles or for other services supplied to the Project by the City of Los Angeles
under  any type of a  special  assessment  district,  and not  included  as Real
Property Taxes; and (10) any other expenses of any kind whatsoever  incurred for
managing,  operating,  protecting,  remediating,  maintaining  and repairing the
Project.  Operating  Expenses shall be adjusted to reflect  ninety-five  percent
(95%)  occupancy  of the  Project  during any period in which the Project is not
fully  occupied.  Operating  Expenses  which are incurred for the benefit of the
Project and other properties owned by Landlord shall be reasonably  allocated by
Landlord between the Project and such other properties.

                  (ii) "Real Property  Taxes" shall mean all taxes,  assessments
(special or  otherwise)  and charges  levied upon or with respect to the Project
(or any portion thereof) and ad valorem taxes on personal property owned or used
by Landlord in connection


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therewith, but excluding taxes on personal property owned or used by Landlord to
the extent that such personal property is used by Landlord in its capacity as an
occupant of the Building. Real Property Taxes shall include, without limitation,
any tax, fee or excise on the act of entering into this Lease,  on the occupancy
of Tenant, or the rent hereunder which are now or hereafter levied,  assessed or
imposed  against  Landlord  by the  United  States  of  America,  the  State  of
California or any political subdivision,  public corporation,  district or other
political  subdivision,  or public entity, and shall also include any other tax,
assessment,  fee or excise,  however  described  (whether  general  or  special,
ordinary  or  extraordinary,  foreseen  or  unforeseen),  which  may be  levied,
assessed or imposed in lieu of, as a substitute,  in whole or in part, for or as
an  addition  to, any other Real  Property  Taxes.  Landlord  shall pay any such
special  assessments  in  installments  when  allowed by law, in which case Real
Property  Taxes shall  include any  interest  charged  thereon,  or, if Landlord
chooses to pay such Real Property  Taxes in a lump sum payment,  Landlord  shall
allocate such Real Property Taxes  (together with a factor for interest  thereon
at the rate such  interest  would have accrued had Landlord  elected to pay such
special  assessments on an installment  basis) to Tenant as if Landlord had paid
such Real Property Taxes on an installment  basis. Real Property Taxes shall not
include income, franchise, transfer, gift, inheritance,  estate or capital stock
taxes, unless, due to a change in the method of taxation,  any of such taxes are
levied,  assessed or imposed  against  Landlord in lieu of, as a substitute,  in
whole or in part,  for any,  other tax which would  otherwise  constitute a Real
Property Tax, but then only to the extent  thereof.  Real  Property  Taxes shall
also include legal fees,  costs and  disbursements  incurred in connection  with
proceedings to contest, determine or reduce Real Property Taxes.

                  (iii)  "Cost  Saving  Capital  Improvement(s)"  shall mean any
equipment,  device or other improvement  incorporated into the Building or other
portion  of  the  Project,  which  capital  improvement  achieves  economies  in
Operating Expenses,  taking into account all applicable costs, in the operation,
maintenance and repair of the Building or such relevant  portion of the Project.
-

                  (iv) "Government Mandated Capital  Improvement(s)"  shall mean
any  equipment,  device  or other  improvement  acquired  and  installed  in the
Building  or other  portion  of the  Project,  to comply  with any  governmental
requirement  with  respect  to the  Building  or  any  portion  of the  Project,
including without limitation, fire, health, safety or construction requirements,
if the cost thereof should be capitalized in accordance with generally  accepted
accounting  principles.  Government  Mandated  Capital  Improvement(s)  and Cost
Saving  Capital  Improvement(s)  are  sometimes  herein  referred to as "Capital
Improvement(s)."

                  (v) "Capital  Improvement  Amortization" shall mean the amount
determined by multiplying the actual cost,  including financing costs if any, of
each Capital Improvement acquired, installed or placed in service by Landlord by
the constant  annual  percentage  required to fully  amortize such cost over the
useful life of the Capital  Improvement (as reasonably  estimated by Landlord at
the time of  acquisition,  installation,  or placement in service).  The Capital
Improvement  Amortization  shall be allocated and charged to Tenant as an amount
per square foot of rentable area consistently applied.

            (b)  Adjustments  to Rent -  Operating  Expenses  and Real  Property
Taxes.  Operating Expenses shall be charged monthly to Tenant as additional rent
as follows:  (i) at an amount ("Premises Operating Expenses") equal to (A) total
rentable  square  footage of the


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Premises Area,  multiplied by (B) two dollars ($2.00) ("Base Operating Expense")
per square foot per month (described in EXHIBIT C hereto), as adjusted from time
to time as follows: on each anniversary  ("Adjustment Date") of the Commencement
Date,  the Base Operating  Expense shall be increased by  multiplying  such Base
Operating  Expense,  by a fraction,  the numerator of which shall be the CPI (as
defined in Section 4.2.1 hereof) for the calendar  month in which the Adjustment
Date falls,  and the  denominator of which shall be (a) the CPI for the calendar
month of the Commencement  Date in the case of the first adjustment on the first
anniversary  of  the  Commencement  Date,  and  (b)  in the  case  of all  other
adjustments,  the CPI for the  calendar  month one year prior to the  Adjustment
Date for which the rental  adjustment is then being  calculated  (such  fraction
shall never be less than one);  the adjusted  amount so  calculated or set shall
constitute the new Base Operating  Expense  hereunder,  but, in no event,  shall
such new Base Operating  Expense be less than the Base Operating Expense payable
for the annual period immediately preceding the Adjustment Date. In any calendar
year, the sum of the Premises  Operating  Expenses,  Tenant's Pro Rata Share (as
defined below) of all costs and other expenses  described in Article XXX for the
Project,  and Tenant's  share of Real Property Taxes and other property taxes as
determined in accordance with Section  4.2.3(d) hereof and the other  provisions
of this Lease,  shall equal the combined  expenses for all twelve months of such
calendar year  ("Combined  Expenses").  In each calendar year during the Term of
this Lease  (including the partial year commencing on the  Commencement  Date of
this  Lease),  the rent  payable  by  Tenant  for such  calendar  year  shall be
increased  over the Basic Annual Rent,  as adjusted in  accordance  with Section
4.2, by the amount of the. Combined Expenses for such calendar year. In addition
to the  foregoing,  any costs or expenses for services or utilities in excess of
those  required  by  this  Lease  to be  supplied  by  Landlord  and  which  are
attributable directly to Tenant's use or occupancy of the Premises shall be paid
in full by  Tenant as  additional  rent when  such  costs are  incurred,  or, if
Landlord  makes such  payments,  within  fifteen  (15) days after  being  billed
therefor by Landlord.  As used in this Lease,  the terms "square  feet," "square
foot" and "square  footage" shall be based on rentable square feet as determined
using the  Building  Owners  and  Managers  Association's  Standard  Method  For
Measuring  Floor  Area  In  Office  Buildings   (ANSI/BOMA   265.1-1996)  ("BOMA
Standards"), unless otherwise specifically provided herein. For purposes hereof,
"Tenant's  Pro Rata Share" shall mean a fraction,  the numerator of which is the
rentable  square feet of the Premises Area and the  denominator  of which is the
rentable square feet of space within the Building.

            (c) Adjustments to Rent for Capital Improvements. In any Lease Year,
or  portion  thereof,  during the Term of this Lease  which is  included  in the
useful life of a Capital Improvement,  the rent payable by Tenant for such year,
or portion  thereof,  shall be increased over the Basic Annual Rent, as adjusted
in  accordance  with  Section  4.2 and  Section  4.3.2(b),  by the amount of the
Capital  Improvement  Amortization  per  square  foot  of  rentable  area of the
Building, multiplied by the Premises Area.

            (d) Additional Taxes and/or Improvements.  Notwithstanding  anything
contained in this Lease to the contrary, any Real Property Taxes, other property
taxes, and/or Government Mandated Capital Improvements which are attributable to
Tenant's use or  occupancy  of the  Premises  shall be paid in full by Tenant as
additional rent. The parties hereto acknowledge that the portion of the Building
occupied or used by Landlord has been  determined  to be tax exempt and that the
portion of the Building occupied by Tenant and other tenants or occupants may be
found to be subject to Real  Property  Taxes and other  property  taxes  because


                                       6
<PAGE>

Tenant  and  other   tenants  and   occupants  do  not   constitute   tax-exempt
organizations  under Section 503(c) of the Internal Revenue Code, as amended, or
because the premises area used by such tenants and occupants are found not to be
used for tax exempt  purposes or for other  reasons.  Consequently,  the parties
hereto  agree that Real  Property  Taxes  assessed  against  the Project (or any
portion  thereof)  or  Building  (or any portion  thereof)  shall be  attributed
entirely to the premises area occupied or used by such taxable organizations and
by  organizations  using  their  premises  area for  purposes  which are not tax
exempt. Landlord shall have the right to allocate such Real Property Taxes among
Tenant and the other tenants and occupants in a reasonably equitable manner. For
these  purposes,  allocating  such Real Property  Taxes in the following  manner
shall be deemed  reasonably  equitable:  multiply the Real  Property  Taxes by a
fraction,  the  numerator of which is the Premises  Area of the Tenant,  and the
denominator  of which is the  rentable  square  feet of  premises  area  used or
occupied by tenants and other occupants for purposes which are not tax exempt or
which are not tax exempt for any other reason.

            (e) Landlord's Statement. Prior to the commencement of each calendar
year  (including the partial year  commencing on the  Commencement  Date of this
Lease),  or as soon  thereafter as possible,  Landlord shall furnish to Tenant a
statement  ("Landlord's  Statement") of Landlord's estimate of the Real Property
Taxes and Capital  Improvement  Amortization  expected to be incurred during the
calendar  year,  based on the  amount of such Real  Property  Taxes and  Capital
Improvement Amortization in the prior calendar year (if any), adjusted for known
changes which have or will occur in the Project, the rates charged by suppliers,
or other  circumstances  affecting  the  amount of such Real  Property  Taxes or
Capital  Improvement  Amortization  during the calendar  year in  question,  and
showing  the  amount,  if any,  payable  by Tenant as  additional  rent for such
calendar  year, or portion  thereof,  pursuant to Sections  4.3.2(b),  4.3.2(c),
4.3.2(d) and any other applicable provisions of this Lease, on the basis of such
estimate.  Commencing as of January 1st of each calendar year,  Tenant shall pay
to Landlord  one-twelfth  (1/12) of the amount of the additional  rent estimated
for Real Property  Taxes and Capital  Improvement  Amortization,  along with the
monthly  charge for Premises  Operating  Expenses,  on each monthly rent payment
date until further adjustment pursuant to this Section 4.3.2. If the Term of the
Lease with respect to any space  commences or  terminates at any time other than
the first day of the  calendar  year,  then during such partial  calendar  year,
Tenant shall pay to Landlord,  on each of the monthly  payment dates during said
partial calendar year, the amount of said estimated additional rent with respect
to such space,  attributable solely to such partial calendar year divided by the
number of months in said  partial  calendar  year.  If  Landlord's  Statement is
furnished  after  January 1st of a calendar  year,  Tenant  shall pay the entire
portion  of the  estimated  additional  rent  attributable  to  portions  of the
calendar year prior to Tenant's receipt of Landlord's  Statement on the later of
fifteen  (15) days,  or the first  monthly  rent payment  date,  after  Tenant's
receipt of Landlord's  Statement.  Landlord shall have the right,  in Landlord's
discretion,  to revise Landlord's  estimates during the calendar year to reflect
the then current Real Property Taxes and Capital Improvement  Amortization,  and
Landlord  shall issue a revised  Landlord's  Statement.  Tenant's  monthly  rent
payments  shall be further  adjusted in accordance  with the revised  Landlord's
Statement  commencing on the first monthly rent payment date following  Tenant's
receipt  from  Landlord of the revised  Landlord's  Statement.  With  reasonable
promptness  after the  expiration of each calendar year, but in any event within
one  hundred  twenty  (120) days after the  expiration  of such  calendar  year,
Landlord shall furnish to Tenant a year-end  statement  showing:  (i) the actual
Real Property  Taxes and Capital  Improvement  Amortization  during the previous
calendar  year,  which  such  amounts  in each  such


                                       7
<PAGE>


category and the proper allocation  thereof to the Project shall be certified by
Landlord and the allocation  thereof to Tenant shall be certified by Landlord to
be proper  and in  accordance  with this  Lease;  (ii) the  difference,  if any,
between  Landlord's  Statement and the actual  amounts;  and (iii) the aggregate
amount of any charge or credit to Tenant  necessary  to adjust  rent  previously
paid by  Tenant to the  actual  Real  Property  Taxes  and  Capital  Improvement
Amortization.  Promptly  after the receipt of said  statement by Tenant,  Tenant
shall,  in case of any  underpayment,  pay Landlord in  accordance  with Section
4.3.1, or in case of an overpayment, Tenant shall receive a credit against rents
subsequently payable to Landlord.

            4.3.3 Charges for Use of Specialized  Research Cores. In addition to
Basic Annual Rent,  Tenant shall be charged for any use by Tenant of Specialized
Research Cores (as defined in Section 9.2 hereof) or any services  rendered from
such Specialized  Research Cores (or both) at rates established by Landlord,  in
its sole  discretion,  from  time to time.  Tenant  understands  that the  rates
charged  for such use or  services  (or both) are subject to change from time to
time.  Services  rendered by or through  Landlord from the Specialized  Research
Cores are more specifically described in Section 28.6 hereof.

      4.4 Definitions. As used in this Lease, the following terms shall have the
following meanings:

            4.4.1 Lease  Years:  Calendar  Years.  "Lease  Years" shall mean the
consecutive  twelve (12) month periods commencing with the Commencement Date or,
if the Commencement  Date falls other than on the first day of a calendar month,
then  commencing  the  first  day of the  first  calendar  month  following  the
Commencement Date. The fraction of the month (if any) following the Commencement
Date and prior to the commencement of the first Lease Year shall be deemed to be
part of the first Lease Year. If Landlord  employs fiscal years not constituting
calendar  years,  the term  "calendar  years"  shall be  deemed,  at  Landlord's
election,   to  mean  the  consecutive  twelve  (12)  month  periods  comprising
Landlord's fiscal years.

            4.4.2 Lease Rate.  "Lease Rate" shall mean an annual  interest  rate
which is the lesser of: (a) the maximum rate permitted by law, if applicable; or
(b) the rate of  interest  from  time to time  announced  by  Union  Bank at its
corporate  headquarters  in Los  Angeles,  California,  as  its  prime  rate  of
interest, plus two (2) percentage points, or, should Union Bank cease or fail to
announce  a prime  rate,  then the rate  announced  from time to time by Bank of
America NT & SA at its corporate headquarters in San Francisco,  California,  as
its reference rate, plus two (2) percentage  points.  Should both Union Bank and
Bank of America NT & SA cease or fail to announce such rates,  the rate shall be
agreed  upon by the  parties  or,  if they  cannot  agree,  the  rate  shall  be
determined by arbitration  pursuant to the American  Arbitration  Association in
accordance  with the then  rules of such  association  and the  decision  of the
arbitrator shall be binding upon the parties.

      4.5 Miscellaneous Rent Provisions.

            4.5.1 Prorations.  If the Term of this Lease commences,  or the date
of expiration of this Lease occurs, other than on the first day or last day of a
calendar  month,  the Basic  Annual Rent for such month shall be prorated on the
basis of a thirty (30) day month.


                                       8
<PAGE>


            4.5.2  Place and  Manner of  Payment.  Basic  Annual  Rent  shall be
payable in advance in twelve  (12) equal  monthly  installments,  with the first
such monthly payment of Basic Annual Rent due on the Commencement Date (prorated
if such date  occurs on other  than the first day of the  month),  and all other
monthly  payments to be due on the first day of each  calendar  month during the
Term  hereof.  All such  payments are to be forwarded by Tenant to the office of
the  Building,  or to such other person or at such other place as directed  from
time to time by written  notice  from  Landlord,  in lawful  money of the United
States of America, without demand, deduction, offset or abatement, except as may
otherwise be specifically provided in this Lease.

            4.5.3  Conditional  Payment.  No  payment  by Tenant or  receipt  by
Landlord of a lesser  amount than the total of all sums due  hereunder  shall be
deemed  other than on account of the  earliest  stipulated  rent,  nor shall any
endorsement or statement on any check, or any letter  accompanying  any check or
payment as rent,  be deemed an accord or  satisfaction,  and Landlord may accept
such cash and/or negotiate such check or payment without prejudice to Landlord's
right to recover  the balance of such rent,  or  Landlord  may pursue any of its
other  remedies  provided  in this  Lease or  otherwise,  regardless  of whether
Landlord makes any notation on such instrument of payment or otherwise  notifies
Tenant that such  acceptance,  cashing or  negotiation  is without  prejudice to
Landlord's rights.

      4.6 Security Deposit. Concurrently with the execution and delivery of this
Lease,  Tenant has deposited  with Landlord Seven Thousand and Fifty Six Dollars
Dollars  ($7,056.00) as security for the full and faithful  performance of every
provision  of this Lease to be  performed  by Tenant.  If Tenant  defaults  with
respect to any  provision  of this  Lease,  including,  but not  limited to, the
provisions relating to the payment of rent set forth in this Lease, Landlord may
use, apply or retain all or any part of the Security  Deposit for the payment of
such rent,  fees or any other sum in  default,  or for the  payment of any other
amount  which  Landlord  may  reasonably  spend or become  obligated to spend by
reason of Tenant's  default,  or to  compensate  Landlord  for any other loss or
damage which Landlord may reasonably  suffer by reason of Tenant's breach of the
terms  of  this  Lease,  or to  pay  Landlord  for  any  amount  due  under  any
indemnification  provision  contained  in  this  Lease.  If any  portion  of the
Security  Deposit is so used or applied,  Tenant  shall  within five (5) days of
receipt of notice thereof from Landlord, deposit cash with Landlord in an amount
sufficient to restore the Security  Deposit to its original  amount and Tenant's
failure to do so shall be a material breach of this Lease. Landlord shall not be
required to keep the  Security  Deposit  separate  from its general  funds,  and
Tenant shall not be entitled to interest on such deposit.

                                   ARTICLE V

                           TAXES ON TENANT'S PROPERTY

      With respect to all of Tenant's  trade  fixtures,  equipment  and personal
property  (collectively,  "Tenant's Property") located within the Premises:  (i)
Tenant  shall pay prior to  delinquency  all taxes  assessed  against  or levied
thereon; and (ii) when reasonably possible,  Tenant shall cause such property to
be assessed and billed separately from the property of Landlord; but if Tenant's
Property shall be assessed and taxed with the property of Landlord, Tenant shall
pay to Landlord  its share of such taxes  within ten (10) days after  receipt by
Tenant  of a  statement  in  writing  setting  forth the  amount  of such  taxes
applicable  to Tenant's  Property,  which  statement  shall include the basis on
which such share of taxes was  allocated to Tenant.



                                       9
<PAGE>


Tenant  shall have the right to contest,  in good faith and by  appropriate  and
timely legal proceedings,  the legality, assessed valuation or amount of any tax
or  assessment  which Tenant is required to pay pursuant to the Lease.  Landlord
shall  reasonably  cooperate with the Tenant in the prosecution of such contest,
provided that all expenses  incurred by Landlord for or in connection  with such
cooperation (including,  without limitation, all attorney's fees, appeals board,
court and other costs) are paid solely by Tenant. If Landlord is required to pay
the taxing  authority  any tax or  assessment  which Tenant  desires to contest,
Tenant shall, pending resolution of the contest by the taxing authority and as a
condition of its right to contest the tax assessment,  pay the tax or assessment
under protest, but otherwise as provided in the Lease.

                                   ARTICLE VI

                                 USE OF PREMISES

      6.1  Limitation of Use.  Tenant shall use and occupy the premises only for
activities ("Biomedical Activities") arising from, or relating to, biomedical or
biochemical   processes  and  methods,   including  research,   development  and
production  of  biomedical  reagents,  agents,  devices,  cell lines,  and other
biomedical  or  biochemical  products  or devices  ("Permitted  Uses"),  as more
particularly  described  in EXHIBIT D attached  hereto.  Tenant shall not use or
occupy the  Premises or permit the same to be used or occupied  for patient care
activities  or for any other  purposes  without  the prior  written  approval of
Landlord,  which approval shall be in Landlord's  sole and absolute  discretion.
Tenant shall control  access to the Premises,  and to any  Specialized  Research
Core used by Tenant, by issuing  identification  badges and access cards to each
of Tenant's employees, who shall be required to carry such identification badges
and access cards at all times that they are present in the Premises or any other
part of the  Building.  Tenant shall not do or permit  anything to be done which
will in any way  obstruct  or  interfere  with the  rights of other  tenants  or
occupants of the Building or injure or annoy them, nor use or allow the Premises
to be used for any improper,  immoral,  or unlawful or reasonably  objectionable
purpose,  nor shall Tenant cause or maintain or permit any nuisance in, or about
the  Premises,  nor shall Tenant  cause or permit any  hazardous or toxic waste,
substance or material to be brought to the Premises or used, handled,  stored or
disposed of in or about the Premises,  except as otherwise  permitted by law and
typically used in the conduct of the Biomedical  Activities  which are conducted
from the Premises in accordance with this Lease and then only in accordance with
the provisions of any rules and regulations established by Landlord from time to
time concerning such use. Tenant shall provide the Director of Radiation  Safety
of Landlord  (or such other  person as Landlord  shall direct from time to time)
with a list of all Hazardous  Materials (as defined in Article XXX hereof) which
it is  using  or  which  it  intends  or  expects  to use in  the  Premises,  an
explanation  of the purpose for each listed item,  and the means and methods for
each listed item's disposal in compliance with all applicable laws. Tenant shall
promptly  revise  and supply  Landlord  with a new list of  Hazardous  Materials
whenever  the  existing  list on file is no longer  complete and accurate in all
respects.  Tenant shall not conduct  business or other  activity in, on or about
the Premises of such a nature as to place an unreasonable  and excessive  burden
upon the public  and Common  Areas of the  Project.  Tenant  shall not commit or
suffer the  commission of any waste in, on or about the Premises.  In connection
with all of the foregoing,  Tenant,  at its sole cost and expense and subject to
compliance  with all  applicable  provisions  of this Lease,  shall  install and
maintain:  (i) such improvements and equipment as shall be reasonably  necessary
to prevent the use or  operation  of  equipment  located in the  Premises or the
conduct of  Tenant's  practice  in the  Premises  from  affecting  others in the
Building or their


                                       10
<PAGE>


equipment;  and (ii) such  additional  floor load support as shall be reasonably
necessary  to  accommodate  equipment  to be  located in the  Premises.  Nothing
contained in this Lease shall limit  Landlord's  right to use, or to lease other
portions of, the Project for any purpose or use that Landlord deems appropriate,
and  nothing  contained  herein  shall be deemed to grant to Tenant any right to
prevent Landlord, or to require Landlord to preclude others in the Project, from
using space anywhere in the Project for the same or similar uses or purposes for
which Tenant uses the Premises.

      6.2 Compliance with Governmental and Insurance  Regulations.  Tenant shall
not use or occupy the Premises in violation of the  Certificate  of Occupancy of
the Building or the Premises or of any law,  ordinance  or  regulation  or other
directive of any governmental  authority having or exercising  jurisdiction over
the Building or Project,  whether now in effect or becoming effective subsequent
to the date hereof (collectively, "Applicable Laws"). Tenant may, in good faith,
contest the validity or application of any law, statute, ordinance, governmental
rule or regulation,  provided  Landlord is not thereby  subject to any liability
and provided  Landlord shall not anticipate  suffering  adverse  consequences or
monetary  or other  damage  as a result  of such  contest  or as a result of the
outcome of such  contest.  Upon five (5) days'  written  notice  from  Landlord,
Tenant  shall  discontinue  any use of the  Premises  which is  declared  by any
governmental  authority  having or exercising  jurisdiction to be a violation of
the  Certificate  of Occupancy of the Building or the Premises or any Applicable
Laws. Tenant shall not do or permit to be done anything which will invalidate or
cause  termination of or increase the cost of any fire and extended  coverage or
other  insurance  policy  covering the  Building,  the Project or the  Property.
Within five (5) days of its receipt of written  notice,  Tenant shall  reimburse
Landlord for any additional  premium  charges for such policy or policies caused
by reason of Tenant's  failure to comply with the  provisions  of this  Section.
Tenant shall keep the Premises, and every part thereof, in a clean, sanitary and
wholesome  condition,  free from any objectionable  noises,  odors or nuisances,
public or private, and Tenant shall comply, at its own expense,  with all health
and policy  regulations.  Tenant  shall  comply  with all laws,  rules,  orders,
ordinances,  directions,  regulations and requirements of federal, state, county
and municipal authorities  pertaining to Tenant's use of the Premises,  and with
any direction of any public  officer or officers,  pursuant to law,  which shall
impose any duty upon Landlord or Tenant with respect to the use or occupation of
the Premises.

      6.3 Assumption of Risk of  Noncompliance.  Tenant hereby warrants that, as
of the execution of this Lease, it has investigated  whether its proposed use of
the  Premises  and its  proposed  manner  of  operation  will  comply  with  all
Applicable  Laws,  and  Tenant  assumes  the risk that its  proposed  use of the
Premises and its proposed  manner of  operation  are and will  continue to be in
compliance with all Applicable Laws, including,  without limitation,  all zoning
laws regulating the use and enjoyment of the Premises.  Tenant agrees that under
no circumstances  will Tenant be released,  in whole or in part, from any of its
obligations  under  this  Lease  as  a  result  of  any  governmental  authority
disallowing or limiting  Tenant's  proposed use of the Premises or its manner of
operation.  Additionally, subject to Article VII below, Tenant shall install, at
its own  expense,  any  improvements,  changes or  alterations  in the  Premises
authorized  in  writing  by  Landlord  which are  required  by any  governmental
authority as a result of Tenant's  specific use of the Premises or its manner of
operation thereunder.  If Landlord performs such alterations because of Tenant's
failure to perform the same,  Tenant shall promptly  reimburse  Landlord for the
actual costs of such alterations.


                                       11
<PAGE>


      6.4  Safety  Training  Program.  Prior  to  participating  in  any  of the
Biomedical  Activities  permitted under this Lease,  each of Tenant's  employees
shall be required to participate in an orientation and safety  training  program
established  by Landlord,  which  program  shall  address  environmental  safety
issues,  including,  but not  limited to, the proper  handling  of  radioactive,
chemical and other Hazardous Materials.

      6.5 Use of Common Services  Space.  Tenant shall have the right to use the
Common  Services  Space  in  connection  with  and  ancillary  to its use of the
Premises, in common with other tenants and occupants of the Building, subject to
such rules and  regulations as Landlord may impose from time to time. The Common
Services Space as of the date of this Lease is graphically depicted on EXHIBIT B
hereto.

      6.6 Animal  Research.  If Tenant uses  animals for or in  connection  with
research on or about the Premises or the Building, such animals must be acquired
or obtained solely through Landlord.  Tenant  acknowledges that a breach of this
Section 6.6 could result in irreparable harm to Landlord and will cause Landlord
to incur substantially damages. Therefore, notwithstanding anything contained in
this Lease to the contrary, any breach of this Section 6.6 shall be deemed to be
an incurable breach which shall automatically  entitle the Landlord, in addition
to all other  remedies to which Landlord is or may be entitled under this Lease,
or at law, or in equity, to terminate this Lease.

                                  ARTICLE VII

                    CONSTRUCTION AND MAINTENANCE OF PREMISES
                           AFTER INITIAL CONSTRUCTION

      7.1 Maintenance of Premises. Following the Commencement Date and except as
otherwise  provided  in Section  7.4 below,  Tenant  shall,  at its own cost and
expense,  keep and maintain,  in good,  sanitary,  and tenantable  condition and
repair, the Premises and every part thereof, including,  without limitation, the
floor  covering,  all  interior  walls,  ceilings,   doors,  decorations  (e.g.,
carpeting,  painting,  wall  covering and  refinishing),  fixtures and equipment
therein.  Landlord may -make any reasonable repairs which are not made by Tenant
with  reasonable  diligence after notice from Landlord and charge Tenant for the
actual cost thereof.  Tenant shall take  precautions to prevent,  shall prevent,
and shall  promptly  eradicate  from the  Premises  or any other  portion of the
Building  or Project  any  infestations  which  arise from  Tenant's  use of the
Premises, including, without limitation, rodents and insects.

      7.2 Tenant Construction.

            7.2.1  Landlord's  Consent.  Tenant shall not make any  alterations,
additions,  modifications or improvements  (collectively,  "Alterations") to the
Premises,  the Building or any part thereof without  Landlord's  advance written
consent,  nor, in any event,  Alterations  which interfere with or disrupt other
tenants or occupants in the Building or with Landlord's work, if any, then being
carried out therein. Landlord shall nor unreasonably withhold its consent to any
alterations, additions or improvements to the Premises or any part thereof which
do not involve  structural  changes to the Building,  do not affect the external
appearance  of the  Building,  and do not  affect or  involve  modifications  to
Building  systems  such as HVAC,  electrical  systems,  floor  load  capacities,
plumbing  and  other  utility  systems.  Landlord  will  grant its  approval  or

                                       12
<PAGE>


disapproval of any proposed  alteration,  addition or improvements within thirty
(30)  business  days  after  receipt  from  Tenant  of the  necessary  plans and
specifications  and other  information  reasonably  necessary to make a decision
with respect  thereto or reasonably  relevant to such Landlord's  decision,  and
failure  by  Landlord  to  disapprove  such  proposed  alteration,  addition  or
improvement  within  such  thirty (30)  business  days shall be deemed  approval
thereof.  To the extent  permitted or consented to hereunder,  any  construction
undertaken by Tenant in or to the Premises or the Building shall comply with all
the terms and provisions of Sections 7.2.2 and 7.2.3 below.

            7.2.2  Licensed  Contractors.  Tenant shall  utilize  only  bondable
licensed contractors for any proposed Alterations.  Tenant shall prepare, obtain
and promptly provide Landlord with copies of bid solicitations and bids received
for all such work.

            7.2.3  Construction  Requirements.  Subject to the other  provisions
hereof,  any  Alterations  installed by Tenant,  its contractor or agents at any
time subsequent to the Commencement Date, and including, without limitation, any
construction  performed  by Tenant,  shall be done only in  compliance  with the
following:

                  (a) No  such  work  shall  proceed  without  Landlord's  prior
written  approval of: (i) Tenant's  contractor  and Tenant's  architect or space
planner; (ii) certificates of insurance; (iii) detailed plans and specifications
for such work; (iv)  performance and labor and materials  payment bonds; and (v)
all governmental permits.

                  (b) Any work not acceptable to any  governmental  authority or
agency having or exercising  jurisdiction over such work, or not satisfactory to
Landlord,  shall be promptly replaced at Tenant's expense.  Notwithstanding  any
failure  by  Landlord  to  object  to any  such  work,  Landlord  shall  have no
responsibility therefor.

                  (c) All work by Tenant or its  contractors  shall be scheduled
through Landlord.

                  (d) Tenant  shall  promptly  reimburse  Landlord for any extra
expense  incurred  by  Landlord  by reason of faulty  work done by Tenant or its
contractors, or by reason of inadequate cleanup.

                  (e) Tenant or any contractor of Tenant shall not use non-union
labor if such use would result in any unreasonable or unusual  interference with
or disturbance of the operations of Landlord or Landlord's labor  relationships.
Neither  Tenant nor any  contractor of Tenant shall use non-union  labor if such
use would  constitute  a  violation  of any  applicable  master  or other  labor
agreement  which is or becomes  binding or  applicable to Landlord now or in the
future.  Tenant  shall  assume  the risk of any  strikes  or labor  disturbances
arising out of the use of non-union  labor,  and any delays  arising out of such
strikes  or  disturbances  shall  not  excuse  or  postpone  the  time  for  any
performance  or  obligation  of Tenant  under this Lease or related  agreements,
notwithstanding the applicability of any force majeure clause or other provision
contained in this Lease or related agreements.


                                       13
<PAGE>


                  (f)  If   required   for   Building   safety   in   Landlord's
discretionary  judgment,  all  x-ray,  laser,  other  medical  equipment,   data
processing,  photocopying, copying, and other special electrical equipment shall
have a separate  duplex outlet and shall be installed only under the supervision
of Landlord or its electrical contractor.  Tenant shall pay any additional costs
on account of any increased support to the floor load necessary  therefor or for
any other equipment or improvements  which Landlord  reasonably  deems necessary
for the proper and safe installation of any such equipment.

                  (g) Before the  commencement of any construction by Tenant in,
on or around the Premises or the Building,  Tenant or its contractors shall give
advance  written  notice  thereof  to  Landlord  or  its  agent  sufficient  for
Landlord's  preparation,  posting and  recordation of an  appropriate  notice of
non-responsibility as provided in California Civil Code ss. 3094 or any related,
successor or similar  provision of law. Within ten (10) days after completion of
any work in, to or about the Premises or the Building,  Tenant or its contractor
shall file for record in the Office of the Los Angeles County  Recorder a notice
of completion as permitted by law.

                  (h) Tenant  acknowledges that Landlord's  approval of Tenant's
plans and  specifications  for any work to be  performed  in or to the  Premises
(including,  without limitation,  any mechanical,  electrical,  architectural or
structural  Alterations)  shall not constitute a  representation  or warranty by
Landlord as to the adequacy of such plans and specifications respecting Tenant's
intended use of the Premises (including,  without limitation,  electrical energy
conservation) or as to the compliance of such plans and  specifications  (or the
work performed  pursuant  thereto) with the laws,  regulations and ordinances of
any governmental authority or agency having or exercising jurisdiction over such
work.  Landlord  expressly  disclaims any liability or  responsibility  for such
plans and  specifications  and the work  performed  pursuant  thereto and Tenant
expressly  agrees that Landlord  shall not be responsible  therefor,  and Tenant
shall  indemnify  and  hold  Landlord  harmless  from  any  damage  or  injuries
(including,  without  limitation,  reasonable  attorneys'  fees)  resulting from
errors or omissions in such plans and specifications.

                  (i) Upon  completion  of such work,  Tenant  shall  deliver to
Landlord a set of as-built drawings and all CADD work (on disks) relating to the
work.

      7.3 Condition of Premises.  Tenant  acknowledges that neither Landlord nor
any agent of Landlord has made any  representation  or warranty  with respect to
the Building or the Premises or with  respect to the  suitability  of either for
the conduct of Tenant's  business.  The taking of  possession of the Premises by
Tenant shall  conclusively  establish that the Premises and the Building were at
such time in good and sanitary order, condition and repair.

      7.4 Landlord Repairs and Maintenance After  Commencement  Date. Subject to
the  provisions  of Section 7.1 above and  performance  of Tenant's  obligations
under this Lease, including,  without limitation, those set forth in Section 4.3
hereof, following the Commencement Date, Landlord shall: (i) keep in good order,
condition and repair the foundations,  exterior walls,  downspouts,  gutters and
roof of the Building and the plumbing and sewage  system  outside the  Building;
(ii) make structural repairs to the Premises necessitated by defective,  faulty,
or negligent  design or  construction;  (iii) repair and maintain the mechanical
systems  necessary  to provide  those  utilities  and  Building  services to the
Premises which Landlord has  specifically  agreed to provide pursuant to Article
XXVIII below, and maintain the light fixtures and unexposed electrical, plumbing
and  sewage  systems  in the  Premises  and  the  heating,  ventilating


                                       14
<PAGE>


and air  conditioning  systems in the Premises.  Notwithstanding  the foregoing,
Landlord  shall not be  obligated  to repair any damage to the  Building  or the
Premises  caused by any act or  negligence of Tenant or its  employees,  agents,
invitees, permittees, licensees or contractors.  Landlord shall not be obligated
to make any such  repairs  until  after the  expiration  of  fifteen  (15) days'
written  notice from Tenant to  Landlord,  stating the need for such  repairs or
maintenance.  Landlord  shall not be called upon or required at any time to make
any repairs, maintenance, improvements, alterations, changes, additions, repairs
or replacements  of any nature  whatsoever in or to the Premises or the Building
except as specifically  provided in this Lease. To the maximum extent  permitted
by law,  Tenant hereby waives the  provisions of any statute or law permitting a
tenant to make  repairs at the expense of a landlord or to  terminate a lease by
reason of the condition of the Premises,  including the provisions of California
Civil  Code  Sections  1941 and  1942  and any  similar,  successor  or  related
provision of law.


                                  ARTICLE VIII

                                MECHANICS' LIENS

      Tenant agrees to pay promptly for all costs and charges for all labor done
or  materials  furnished  for any  work  of  repair,  maintenance,  improvement,
alteration or addition, including, without limitation, installation of fixtures,
done or caused to be done by Tenant in connection with the Premises,  and Tenant
hereby  indemnifies and agrees to hold Landlord and the Premises free, clear and
harmless  from and  against  all  liens  and  claims  of  liens,  and all  other
liabilities,  claims and  demands  (including,  without  limitation,  reasonable
attorneys'  fees),  that arise by reason of such work. If any such lien shall at
any time be filed against the Premises,  or any portion of the Building,  Tenant
shall either cause the same to be  discharged  of record within twenty (20) days
after the date upon which the same is filed or, if Tenant in its  discretion and
in good  faith  determines  that such lien  should be  contested,  Tenant  shall
record,  in the  office of the county  recorder  in which such claim of lien was
recorded,  a bond executed by a corporation  authorized to issue surety bonds in
the State of California,  in a penal sum equal to one and one-half (1 1/2) times
the amount of the claim or one and  one-half (1 1/2) times the amount  allocated
to the Premises (and/or to other portions of the Building, Project, or Property)
to prevent any  foreclosure  proceedings  against  the  Premises  (and/or  other
portions of the  Building,  Project,  or  Property)  during the pendency of such
contest.  Such bond shall be  conditioned  for the  payment of any sum which the
claimant may recover on the claim together with the claimant's  costs of suit in
the action,  if the claimant  recovers  therein.  Nothing contained herein shall
imply any consent or  agreement  on the part of  Landlord to subject  Landlord's
interest in the real  property  of which the  Premises  are a part to  liability
under any  mechanics'  or other lien law.  Should Tenant  receive  notice that a
claim  of lien  has been or is about  to be  filed  against  the  Premises,  the
Building,  Property  or Project or that any action  affecting  the title to such
property  has  commenced  or is  about to  commence,  Tenant  shall  immediately
transmit such notice and information to Landlord.

                                   ARTICLE IX

                   COMMON AREAS AND SPECIALIZED RESEARCH CORES

      9.1 Common Areas. The term "Common Areas" as used in this Lease shall mean
all areas and facilities around the Premises and within the exterior  boundaries
of the Property which are provided and designated  from time to time by Landlord
for the general use and  convenience


                                       15
<PAGE>


of Tenant and other  tenants or occupants  of the Building and their  respective
employees, invitees or other visitors. Common Areas include, without limitation,
the  Common  Services  Space,  the lobby  area,  walkways,  parking  facilities,
landscaped areas, sidewalks,  service quarters, hallways, restrooms (if not part
of the  Premises),  stairways,  elevators,  walls,  fire stairs,  telephone  and
electric closets, truck docks, plazas, service areas, lobbies, darkroom, pantry,
small conference room, glass wash room,  equipment corridor,  walk-in cold room,
and all other common and service areas of the Property and Building or any other
area of the Project intended for such use, other than Specialized Research Cores
(defined in Section 9.2 hereof). Floors wholly occupied by Tenant shall not have
any facilities which would be used in common with other tenants, except for fire
stairs,  shafts and similar  installations.  Tenant,  its employees and invitees
shall have the  nonexclusive  right to use the Common  Areas  along with  others
entitled to use the same, subject to Landlord's rights and duties as hereinafter
set forth. Without advance notice to Tenant or consent of Tenant and without any
liability to Tenant in any respect, Landlord shall have the right to:

            (a)  establish  and  enforce   reasonable   rules  and   regulations
concerning the maintenance, management, use and operation of the Common Areas;

            (b) close off any of the Common Areas to whatever extent required in
the  reasonable  opinion of Landlord and its counsel to prevent a dedication  of
any of the Common Areas or the accrual of any rights by any person or the public
to the Common Areas;

            (c)  temporarily  close any of the  Common  Areas  for  maintenance,
alteration or improvement purposes;

            (d) select,  appoint and/or contract with any person for the purpose
of operating and maintaining the Common Areas; and

            (e)  change  the size,  use,  shape or  nature of any of the  Common
Areas.

      Landlord shall use its reasonable  efforts to minimize  interference  with
Tenant's use of and access to the Premises  when  exercising  Landlord's  rights
with respect to the Common Areas set forth in this Article IX.

      9.2 Specialized  Research Cores. The term "Specialized  Research Cores" as
used in this Lease shall mean all areas and  facilities  around the Premises and
within the exterior boundaries of the Property which are provided and designated
from time to time by Landlord  for  special  use by Tenant and other  tenants or
occupants of the Building and their respective  employees.  Specialized Research
Cores include,  without limitation,  animal housing facilities,  animal surgical
core, confocal microscopy facility, sequencing core, and cell sorter core.

                                   ARTICLE X

                           LANDLORD'S RIGHT OF ACCESS

      Landlord  reserves  for  itself  and its  agents  the  right to enter  the
Premises  (after  advance  notice  except in  emergencies  and except to perform
janitorial  services) for purposes reasonably related to Landlord's operation of
the Building,  including,  without limitation:  (i) examining or inspecting, the
same; (ii) providing janitorial and any other service to be provided by Landlord
to

                                       16
<PAGE>


Tenant hereunder;  (iii) showing the same to prospective tenants,  purchasers
or lenders (or to others who may have a financial interest in the Building) in a
reasonable  manner;  (iv) emergency entry; (v) making such changes or repairs to
the  Premises  or to any other  portion of the  Building  as  Landlord  may deem
necessary or desirable;  and (vi) showing the Premises to  prospective  tenants,
during the last one hundred eighty (180) day period before the expiration of the
term or before an earlier termination of this Lease; all without being deemed to
constitute or cause any eviction of Tenant and without abatement of rent. Tenant
hereby  waives  any claim for  damages  for any  injury or  inconvenience  to or
interference with Tenant's business, any loss of occupancy or quiet enjoyment of
the Premises,  and any other loss occasioned thereby.  For each of the aforesaid
purposes, Landlord shall at all times have and retain a key with which to unlock
all of the doors in, upon and about the Premises,  excluding Tenant's vaults and
safes, and Landlord shall have the right to use any and all means which Landlord
may reasonably deem proper to open said doors in an emergency in order to obtain
entry to the Premises, and any entry to the Premises obtained by Landlord by any
of said means shall not under any  circumstances  be construed or deemed to be a
forcible or unlawful entry into or a detainer of the Premises, or an eviction of
Tenant from the Premises or any portion thereof. Whenever Landlord exercises its
right of entry  pursuant to this Article X,  Landlord  shall use its  reasonable
efforts to maintain the confidentiality of Tenant's biomedical research records,
as required by law. No provision of this Lease shall be construed as  obligating
Landlord to perform any repairs, alterations or decorations, except as otherwise
expressly provided herein. Landlord shall have the right to run utility or other
services and facilities through the Premises, whether to service the Premises or
other  portions of the  Building.  If, during the last month of the Term hereof,
Tenant shall have removed substantially all of its property therefrom,  Landlord
may immediately  enter and alter,  renovate and redecorate the Premises  without
eliminating  or abating any rent hereunder or incurring any liability to Tenant.
Tenant's  property  remaining  within the  Premises at the time of such entry by
Landlord may be warehoused by Landlord at Tenant's sole cost, expense and risk.

                                   ARTICLE XI

                   PROPERTY DAMAGE AND PERSONAL INJURY CLAIMS

      11.1  Indemnification.  Tenant shall indemnify and hold harmless  Landlord
against and from any and all claims of damage or injury  arising  from  Tenant's
use of the Premises or the conduct of its business or from any activity, work or
thing done,  permitted  or  suffered  by Tenant in or about the  Premises or the
Building,  and shall further  indemnify and hold harmless  Landlord  against and
from any and all claims arising from any breach or default in the performance of
any  obligation  of Tenant  hereunder,  or arising  from any act or  omission of
Tenant, or any of its agents, employees,  invitees or licensees, and against and
from all costs,  attorneys' fees,  consultants'  fees,  expenses and liabilities
incurred  in  connection  with or as a result of any such claim or any action or
proceeding  brought  thereon  (including,   without  limitation,   any  and  all
judgments,  fines and costs of appeal and costs of settlement),  and in case any
action or  proceeding is brought  against  Landlord by reason of any such claim,
Landlord may require  Tenant,  upon notice from Landlord,  to defend the same at
Tenant's expense with counsel selected by Landlord.

      11.2 Assumption of Liability and Waiver of Claims.  Tenant,  as a material
part of the consideration to Landlord for this Lease, hereby assumes all risk of
damage to property  or injury to persons in, upon or about the Project  from any
cause whatsoever, and Tenant hereby waives


                                       17
<PAGE>


all  claims in respect  thereof  against  Landlord  and  acknowledges  that this
assumption  and waiver by Tenant has been  reflected  as a reduction of the rent
which  Landlord  would  otherwise  charge.  Landlord  shall  not be  liable  for
interference  with light, air or other similar  benefits,  nor shall Landlord be
liable for any latent or patent defect in the Project.  Tenant shall give prompt
notice  to  Landlord  in case of fire or  accidents  in the  Premises  or in the
Building  or defects  therein  or in the  fixtures  or  equipment  thereof,  but
Landlord's  receipt of such  notice  shall not impose  upon  Landlord  any duty,
liability or obligation  which it has not assumed or which it has  disclaimed in
this Lease. Landlord shall not be liable for any damage to property entrusted to
employees  of the  Building,  nor for the loss of, or damage to, any property by
theft or  otherwise,  nor for any  injury  or  damage to  persons,  property  or
Tenant's  business (or loss of income)  resulting from  construction,  repair or
alteration of premises-adjoining the Premises, the Premises or any other portion
of the Building,  or from the pipes,  appliances or plumbing works  therein,  or
from the roof, street or subsurface,  or from any other place, or resulting from
dampness or any other  cause  whatsoever,  nor shall  Landlord be liable for any
damage  caused by acts or omissions of other  tenants,  occupants or visitors of
the Project.

                                  ARTICLE XII

                                    INSURANCE

      12.1 Tenant's Insurance  Obligations.  From and after the date of delivery
of the Premises from Landlord to Tenant, Tenant shall carry and maintain, at its
own expense, the following types, amounts and forms of insurance:

            12.1.1 Liability Insurance. Tenant shall carry and maintain a policy
of comprehensive general liability insurance with a combined single limit of not
less than Five Million Dollars ($5,000,000) per occurrence in the name of Tenant
(with Landlord and, if requested by Landlord, any mortgagee,  trust deed holder,
ground lessor or secured  party with an interest in this Lease,  the Building or
the Project  named as  additional  insured(s)).  Such policy shall  specifically
include,  without  limitation,  personal injury,  broad form property damage and
contractual  liability  coverage,  the last of which  shall  cover the  insuring
provisions  of this  Lease  and  the  performance  by  Tenant  of the  indemnity
agreements in Article XI above. The amount of such insurance  required hereunder
shall be subject to  adjustment  from time to time as  reasonably  requested  by
Landlord.

            12.1.2 Property Insurance.  Tenant shall carry and maintain a policy
or policies of property  insurance in the name of Tenant (with  Landlord and, if
requested by  Landlord,  any  mortgagee,  trust deed  holder,  ground  lessor or
secured party with an interest in this Lease,  the Building or the Project named
as additional  insured(s))  covering any tenant improvements in the Premises and
Alterations and any property of Tenant at the Premises and providing  protection
against  all  perils  included  within  the  classification  of  fire,  extended
coverage,  vandalism,  malicious mischief, special extended peril (all risk) and
sprinkler leakage,  in an amount equal to at least one hundred percent (100%) of
the replacement cost thereof from time to time (including,  without  limitation,
cost of debris removal).

            12.1.3  Workers'  Compensation  Insurance.  Tenant  shall  carry and
maintain a policy of workers'  compensation  insurance  in  compliance  with all
applicable laws.


                                       18
<PAGE>


            12.1.4 Other  Insurance.  Tenant shall carry and maintain such other
policies of insurance  (including,  without  limitation,  business  interruption
insurance)  in  connection  with the  Premises as Landlord may from time to time
require.

            12.1.5  Policy  Provisions.  All  of  the  policies  required  to be
obtained by Tenant  pursuant to the  provisions  of this  Section  12.1 shall be
issued by companies, and shall be, in form and content, reasonably acceptable to
Landlord.  Without  limiting the  generality of the  foregoing,  any  deductible
amounts under said policies shall be subject to Landlord's approval. Each policy
shall designate  Landlord as an additional  named insured and shall provide full
coverage in the amounts set forth herein. Although named as an insured, Landlord
shall be entitled to recover  under said  policies  for any loss  occasioned  to
Landlord,  its servants,  agents and  employees,  by reason of the negligence of
Tenant.  Tenant shall,  prior to delivery of the Premises by Landlord to Tenant,
provide Landlord with copies of and certificates for all insurance policies. All
insurance  policies shall provide that they may not be altered or canceled until
after  thirty (30) days written  notice to Landlord  (by any means  described in
Article  XXII  below).  Tenant  shall,  at least  thirty  (30) days prior to the
expiration of any of such  policies,  furnish  Landlord with a renewal or binder
therefor.  Tenant  may  carry  insurance  under a  so-called  "blanket"  policy,
provided  that  such  policy  provides  that the  amount of  insurance  required
hereunder shall not be prejudiced by other losses covered thereby. All insurance
policies   carried  by  Tenant   shall  be   primary   with   respect   to,  and
non-contributory  with,  any other  insurance  available  to Landlord  and shall
contain cross-liability  coverage. If Tenant fails to carry any insurance policy
required  hereunder  or to furnish  copies  thereof  and  certificates  therefor
pursuant hereto, Landlord may obtain such insurance,  and Tenant shall reimburse
Landlord  for the  costs  thereof  with  the  next  monthly  rent  payments  due
hereunder.

      12.2  Landlord's  Insurance  Obligations.  During the Term of this  Lease,
Landlord  shall keep and maintain  fire and  extended  coverage  insurance  with
vandalism  and  malicious  mischief  endorsement  for the  Building  and  public
liability  insurance or an equivalent  funded program of  self-insurance in such
reasonable  amounts with such  reasonable  deductibles  as would be carried by a
prudent owner of a similar building in Southern California.  Landlord may obtain
insurance  for the Building  and the rents from the Building  against such other
perils as Landlord may reasonably consider appropriate. Tenant acknowledges that
it will  not be a named  insured  in such  policies  and that it has no right to
receive any  proceeds  from any such  insurance  policies  carried by  Landlord.
Landlord  shall  not be  required  to  carry  insurance  covering  the  property
described in Section 12.1.2 above.

      12.3 Waivers of Subrogation. Each of the parties hereto waives any and all
rights of recovery  against the other or against any other tenant or occupant of
the  Building,  or against the  officers,  employees,  agents,  representatives,
patients or visitors of such other party or of such other  tenant or occupant of
the Building, for loss of or damage to such waiving party or its property or the
property of others under its control and arising from any cause insured  against
under any  insurance  required to be carried by such waiving  party  pursuant to
this Lease or arising from any cause insured  against under any standard form of
first insurance  policy with all  permissible  extension  endorsements  covering
additional  perils  carried by such  waiving  party or under any other policy of
insurance carried by such waiving party in lieu thereof, to the extent such loss
or damage is insured against .by such policy.


                                       19
<PAGE>


      12.4  Increases.  Tenant shall pay any  increases  in  insurance  premiums
relating to property in the Project  other than the  Premises to the extent that
any such  increase is  specified  by the  insurance  carrier as being  caused by
Tenant's acts or omissions or use or occupancy of the Premises.

                                  ARTICLE XIII

                  DAMAGE OR DESTRUCTION OF BUILDING OR PREMISES

      13.1 Repair; Termination. If the Premises or the Building is damaged by an
insured  casualty  occurring more than six (6) months prior to the expiration of
the Term hereof,  Landlord shall forthwith repair the same, or cause the same to
be  repaired,  to the extent  that  insurance  proceeds  are made  available  to
Landlord therefor and provided that such repairs can, in Landlord's  opinion, be
made within  ninety (90) days from the date of such damage  (without  payment of
overtime or other premiums) under the laws and regulations of the federal, state
and local governmental  authorities having jurisdiction  thereof. If Landlord is
not so required to repair such  damage,  Landlord  shall have the option  within
sixty (60) days from the date of such  damage  either  to: (i) notify  Tenant of
Landlord's  election  to repair  such  damage,  in which  event  Landlord  shall
thereafter use its reasonable  efforts to repair the same; or (ii) notify Tenant
of Landlord's election to immediately  terminate this Lease, in which event this
Lease shall be so terminated. Notwithstanding any contrary provision herein: (a)
Landlord shall not be required to repair any damage to the property of Tenant or
to repair or replace  any  paneling,  decorations,  railings,  floor  coverings,
alterations,  additions,  fixtures,  equipment or improvements  installed in the
Premises  by or at the  expense  of  Tenant;  and  (b)any  damage  caused by the
negligent,  reckless  or  intentional  act or  omission  of Tenant or any of its
agents, contractors, employees or invitees shall be promptly repaired by Tenant,
at its sole cost and expense, to the reasonable satisfaction of Landlord.

      13.2  Abatement  of Rent.  If  Landlord  repairs  damage  to the  Premises
pursuant to the  provisions  of Section  13.1 above,  Basic  Annual Rent payable
hereunder shall be abated,  until such repairs are completed,  in the proportion
that the  square  footage  of the  portion,  if any,  of the  Premises  rendered
unusable by Tenant bears to the Premises  Area;  provided,  however,  that there
shall be no such abatement:  (i) except to the extent Landlord receives proceeds
covering the amount of such abatement  under any rental value  insurance  policy
maintained  by  Landlord;  (ii) to the  extent  that any  business  interruption
insurance  policy  required  pursuant to Section 12.1.4 above insures payment of
Basic Annual Rent;  (iii) unless a material  portion of the Premises is rendered
unusable for more than fifteen (15)  consecutive  business  days; or (iv) if the
damage so repaired is caused by the negligent,  reckless or  intentional  act or
omission of Tenant or any of its agents,  contractors,  employees  or  invitees.
Except for  abatement of Basic Annual Rent,  if any,  Tenant shall have no claim
against  Landlord  for any damage  suffered  by reason of: (1) any damage to the
Premises; (2) such repairs; or (3) any inconvenience,  interruption or annoyance
caused by such damage or repairs.

      13.3  Waiver.  In respect of any  partial or total  damage or  destruction
which  Landlord is obligated or agrees to restore under any of the provisions of
this Lease, Tenant hereby waives the provisions of Sections 1932 and 1933 of the
California Civil Code and any related, similar or successor provision of law, to
the extent applicable hereto, if at all.


                                       20
<PAGE>


                                  ARTICLE XIV

                                 EMINENT DOMAIN

      If the whole of the  Premises or so much  thereof as to render the balance
unusable by Tenant shall be taken by right of eminent domain or by condemnation,
or shall be conveyed in lieu of any such taking,  then this Lease, at the option
of either Landlord or Tenant  exercised by either party giving written notice to
the other of such  termination  within  thirty  (30) days after  such  taking or
conveyance,  shall forthwith cease and terminate and the rent and all other sums
payable  hereunder  shall be duly  apportioned  as of the date of such taking or
conveyance.  Tenant  thereupon  shall surrender to Landlord the Premises and all
interest  therein under this Lease, and Landlord may reenter and take possession
of the Premises and remove Tenant  therefrom.  If any portion of the Premises or
any portion of the  Building  which shall not render the  Premises  untenantable
shall be taken or conveyed as described above, then this Lease, at the option of
Landlord  exercised  by  Landlord  giving  written  notice  to  Tenant  of  such
termination  within  thirty  (30) days after such  taking or  conveyance,  shall
forthwith cease and terminate and the rent and all other sums payable  hereunder
shall be duly  apportioned as of the date of such taking or  conveyance.  Tenant
thereupon  shall  surrender to Landlord  the  Premises and all interest  therein
under this Lease,  and Landlord may reenter and take  possession of the Premises
and remove Tenant therefrom.  No award for any partial or entire taking shall be
apportioned  and Tenant hereby releases any claim to and assigns to Landlord any
award which may be made in such taking or  condemnation,  together  with any and
all  rights of Tenant  now or  hereafter  arising  in or to the same or any part
thereof,  including,  but not  limited  to, any award for the  "bonus  value" of
Tenant's interest under this Lease. In the event of a partial taking, or a sale,
transfer or conveyance  in lieu thereof,  which does not result in a termination
of this Lease pursuant to the foregoing, the rent shall be apportioned according
to the ratio that the part of the Premises  remaining  usable by Tenant bears to
the total area of the Premises. To the extent it is inconsistent with the above,
each party waives the provisions of Section  1265.130 of the California  Code of
Civil  Procedure  allowing  either  party  to  petition  the  superior  court to
terminate this Lease in the event of a partial taking of the Premises.

                                   ARTICLE XV

             ASSIGNING - MORTGAGING- SUBLETTING- CHANGE IN OWNERSHIP

      15.1 No Unauthorized Transfer. Tenant shall not voluntarily,  by operation
of law  or  otherwise,  assign,  sublet,  enter  into a  license  or  concession
agreement for, hypothecate, encumber, pledge or otherwise transfer this Lease or
Tenant's  interest in the Premises (or any portion  thereof) or permit any third
party or parties other than Tenant, its authorized agents,  employees,  invitees
and visitors,  to occupy the Premises or any portion thereof without  Landlord's
advance written  consent in each instance,  which consent may be withheld in the
sole and absolute  discretion of Landlord.  Tenant  acknowledges and agrees that
Landlord is entering into this Lease because Landlord has permitted Tenant to be
present in the Building on the basis of both  tangible and  intangible  factors,
many of which are not susceptible of rational  articulation  or  prioritization,
and that the Premises represents scarce space in the Building which is owned and
primarily occupied by Landlord.  Any attempted  assignment,  subletting or other
transfer without  Landlord's  advance written consent shall constitute a default
hereunder  and, at  Landlord's  election,  shall be void so as not to confer any
rights upon any third person.


                                       21
<PAGE>


      15.2  Procedures  for Requesting  Authorization.  If Tenant desires at any
time to assign or otherwise transfer this Lease or to sublet the Premises or any
portion thereof,  it must first notify Landlord of its desire to do so and shall
submit  in  writing  to  Landlord:  (i) the name of the  proposed  subtenant  or
assignee;  (ii) the nature of the proposed subtenant's or assignee's business to
be carried on in the  Premises;  (iii) the terms and  provisions of the proposed
sublease  or  assignment;  and  (iv)  such  financial,  professional  and  other
background information as Landlord may request concerning the proposed subtenant
or assignee.

      15.3  Landlord's  Option.  At any  time  within  thirty  (30)  days  after
Landlord's receipt of the information  specified in Section 15.2 above, Landlord
may by written notice to Tenant elect,  in the exercise of its sole and absolute
discretion,  to: (i) consent to the subletting or assignment  upon the terms and
to the subtenant or assignee  proposed;  (ii) refuse to give  consent;  or (iii)
sublease  the  Premises or the portion so proposed to be  subleased by Tenant or
take an assignment of Tenant's  leasehold  estate hereunder or such part thereof
as shall be  specified  in said  notice  upon the same  terms  (excluding  terms
relating to the use of Tenant's name or the  continuation of Tenant's  business)
as those  offered to the proposed  subtenant  or  assignee,  as the case may be.
Tenant agrees that  Landlord may consent to a proposed  subletting or assignment
subject to such conditions as Landlord deems  appropriate in the exercise of its
sole and  absolute  discretion,  including,  but not limited to, the  conditions
specified in Sections  15.4.1,  15.4.2 and 15.4.3 below.  Tenant  further agrees
that no  assignment  or  subletting  consented  to by Landlord  shall  impair or
diminish any covenant, condition or obligation imposed upon Tenant by this Lease
or any right,  remedy or benefit  afforded  Landlord by this Lease.  If Landlord
consents to such  assignment or subletting,  Tenant may, within ninety (90) days
after the date of Landlord's consent,  enter into a valid assignment or sublease
of the Premises or portion  thereof upon the terms and  conditions  described in
the  information  required to be  furnished  by Tenant to  Landlord  pursuant to
Section 15.2 above, or upon other terms not more favorable to Tenant;  provided,
however,  that any material  change in such terms shall be subject to Landlord's
consent as provided  in this  Article  XV.  Failure of Landlord to exercise  any
option set forth in clauses (i) through  (iii) above within such thirty (30) day
period shall be deemed refusal of Landlord to consent to the proposed subletting
or assignment.

      15.4 Conditions to Consent.

            15.4.1  Standards  of  Reasonableness.  Landlord  may  withhold  its
consent to any assignment or subletting,  encumbrance,  hypothecation, pledge or
other  transfer in the  exercise of  Landlord's  sole and  absolute  discretion.
Landlord hereby advises Tenant in advance and Tenant hereby agrees that Landlord
will withhold such consent for any of the following  reasons,  among others,  if
the proposed  assignee,  sublessee or  transferee:  (i) is not  satisfactory  to
Landlord as to credit or character or business or professional reputation;  (ii)
intends to occupy the Premises for purposes  other than  specified in this Lease
or for purposes  which are  inconsistent  with  Landlord's  commitments to other
tenants in the Building or in other  buildings or facilities  owned and operated
by Landlord, or for purposes which are unlawful or reasonably undesirable; (iii)
is unable  to  fulfill  the terms of this  Lease;  (iv) is not  satisfactory  to
Landlord as to the quality of services provided or research to be conducted;  or
(v) will be occupying the Premises to supply  services which are  duplicative of
services already available to patients or the professional staff of Cedars-Sinai
Medical Center or to occupants in the Building.


                                       22
<PAGE>


            15.4.2 Further  Transfers.  In no event shall Landlord's  consent to
any  assignment,  transfer or subletting  relieve Tenant from the obligations to
obtain Landlord's express written consent to any further  assignment,  transfer,
subletting or  sub-subletting or release Tenant from any liability or obligation
hereunder  (whether or not then accrued) and Tenant shall  continue to be fully,
jointly and severally liable  hereunder  notwithstanding  Landlord's  consent to
such assignment, transfer or subletting.

            15.4.3 Rent or Other Premiums.  As a further condition to Landlord's
consent to any subletting,  assignment or other transfer referred to in Sections
15.3 and 15.4.1 or any other part of Article XV,  Landlord  shall be entitled to
receive any rent or other premium  otherwise  payable to Tenant in consideration
of the sublease, assignment or other transfer (i.e., if the sublease, assignment
or other  transfer  provides that the  sublessee,  assignee or other  transferee
thereunder  is to pay any  amount in excess  of the rent and other  charges  due
under this Lease, whether such premium be in the form of an increased monthly or
annual rent, a lump sum payment in consideration of the sublease,  assignment or
transfer  or   consideration   of  the  sublease,   assignment  or  transfer  or
consideration  of any other form,  such  premium over and above the rent and the
other sums due hereunder shall, at Landlord's election, inure only to Landlord's
benefit),  and any such sublease,  assignment or transfer and Landlord's consent
shall be effected on forms  supplied or approved by Landlord and its  attorneys.
In addition,  the Basic Annual Rent, after the transfer,  shall not be less than
the Basic Annual Rent, as adjusted pursuant to Section 4.2,  immediately  before
the transfer, plus the total compensation paid for the annual period immediately
preceding the transfer, pursuant to Section 4.3.2 hereof.

            15.4.4  Processing  Costs  and  Fees.  Tenant  agrees  to  reimburse
Landlord  for  Landlord's  reasonable  costs and  attorneys'  fees  incurred  in
connection  with  the  processing  and   documentation  of  any  such  requested
assignment, subletting, transfer, change of ownership,  hypothecation, pledge or
encumbrance of this Lease or Tenant's interest in and to the Premises.

            15.4.5 No Waiver. No subletting,  assignment or other transfer, even
with the consent of Landlord,  shall relieve Tenant of its obligation to pay the
rent and to  perform  all of the other  obligations  to be  performed  by Tenant
hereunder.  Landlord's  consent  to any one  transfer  shall  apply  only to the
specific  transaction thereby authorized and such consent shall not be construed
as a waiver of the duty of Tenant or any transferee to obtain Landlord's consent
to any other or  subsequent  transfer or as  modifying  or  limiting  Landlord's
rights  hereunder in any way.  Landlord's  acceptance  of rent  directly for any
subtenant, assignee or any other transferee shall not be construed as Landlord's
approval or consent thereto nor Landlord's agreement to accept the attornment of
any subtenant in the event of any  termination of this Lease.  In no event shall
Landlord's  enforcement of any provision of this Lease against any transferee be
deemed a waiver of  Landlord's  right to enforce any term of this Lease  against
Tenant or any other person.

            15.4.6 Nature of Tenant. If Tenant is a corporation which, under the
then current  guidelines  published by the  Commissioner  of Corporations of the
State of California, is not deemed a public corporation, or is an unincorporated
association  or  partnership  or  company,  the  following  shall be  deemed  an
assignment  within the  meaning of this  Article XV: the  transfer,  assignment,
hypothecation,  or other disposition,  whether in one transaction or a series of
transactions,  of any stock or  interest  in such  corporation,  association  or
partnership,  which results in a transfer,  assignment,  hypothecation,  change,
addition, or other disposition of twenty-five


                                       23
<PAGE>


percent  (25%)  or more of any  class  of  stock  in  Tenant  or in a  transfer,
assignment,  hypothecation,  or other  disposition  of a 25% interest or more in
Tenant (including,  without limitation,  an interest in profits,  net profits or
cash  flow).  Tenant  shall  notify  Landlord of any  transfer  of an  ownership
interest  in Tenant to any person not later than  thirty (30) days prior to such
transfer  together  with a summary of the  material  terms of such  transaction,
whether or not consent of Landlord is required pursuant to this Article XV.

                                  ARTICLE XVI

                            SUBORDINATION; ATTORNMENT

      16.1 Subordination. With respect to all ground leases, mortgages, deeds of
trust  or  other  recorded   evidences  of  financing   obligations   ("Superior
Interests")  now or  hereafter  covering  the  Premises  and/or all or any other
portion of the Project, Building or the Property, and with respect to the ground
lessors,  mortgagees or beneficiaries  thereunder ("Superior Interest Holders"),
Tenant agrees as follows:

            (a) Unless  otherwise  requested by any Superior  Interest Holder in
writing,  this Lease is and shall remain  subordinate to all Superior  Interests
existing  as of the  date of this  Lease,  and to all  renewals,  modifications,
consolidations, replacements, extensions and amendments thereof.

            (b) If requested by any future Superior  Interest Holder in writing,
this Lease shall  automatically  become  subordinate to any such future Superior
Interest and all extensions or amendments thereof.

      The above-referenced subordinations shall be automatic and self-executing,
but  additionally  Tenant agrees,  within ten (10) days after receipt of written
request  therefor from  Landlord or any Superior  Interest  Holder,  to execute,
acknowledge  and deliver  any and all  documents  or  instruments  requested  to
confirm and assure such subordination under the above-referenced terms.

      16.2  Attornment.  Tenant shall attorn to any person,  firm or corporation
purchasing or otherwise acquiring the Premises,  Building or Project at any sale
or other  proceeding,  or  pursuant to the  exercise  of any  rights,  powers or
remedies under any Superior  Interests,  as if such person,  firm or corporation
had been named as Landlord  herein.  Tenant  shall  confirm such  attornment  in
writing if so requested.

      16.3  Attorney-in-Fact.  If Tenant fails to execute any document  required
from  Tenant  under this  Article  within ten (10) days  after  written  request
therefor,  Tenant  hereby  constitutes  and  appoints  Landlord  as its  special
attorney-in-fact  to execute and deliver any such  document or  documents in the
name of Tenant. Such power, being coupled with an interest, is irrevocable.

      16.4 Non-Disturbance.  With respect to any ground leases, mortgages, deeds
of trust, or other liens entered into by Landlord and any such mortgagee or deed
of trust beneficiary,  and in consideration of Tenant's agreement to be bound by
the provisions of this Article XVI, Landlord shall use its reasonable efforts to
cause, upon the request of Tenant;  any and all future Superior Interest Holders
to enter into and deliver to Tenant  non-disturbance  and attornment  agreements
which  are  customarily  entered  into  by such  Superior  Interest  Holders  in
consideration of the  subordination  of pre-existing  tenant leases such as this
Lease.


                                       24
<PAGE>


                                  ARTICLE XVII

                                     DEFAULT

      17.1  Default by Tenant.  The  occurrence  of any of the  following  shall
constitute a breach of and default under this Lease by Tenant:

            (a)  Failure  by  Tenant  to  pay  any  amount,   including  without
limitation,  monthly  installments of Basic Annual Rent and any additional rent,
when and as the same becomes  payable in accordance  with the provisions of this
Lease,  and the  continuation of such failure for a period of three (3) business
days after written notice thereof from Landlord to Tenant.

            (b) Failure by Tenant in the due,  prompt and  complete  performance
and  observance of any express or implied  covenant,  agreement or obligation of
Tenant  contained in this Lease,  other than the breaches  described of Sections
17.1(a),  (g), and (h) hereof, and the continuation of such failure for a period
of fifteen  (15) days after  written  notice  thereof  from  Landlord  to Tenant
specifying  the  nature of such  failure;  provided,  however,  that if any such
failure  involves a hazardous  condition or involves  interference  with,  or an
adverse effect upon, Landlord's operations in the Building or those of any other
tenant or occupant of the Building,  Landlord shall have the right,  in addition
to its other  rights  under  this  Lease,  to cure such  condition  or to obtain
injunctive  relief  against  Tenant if the  condition  is not cured  within said
fifteen  (15) day period or such  shorter  period of time as may be  required by
applicable laws or as may be required by Landlord.

            (c)  Tenant's  vacating  or  abandoning  of the  Premises,  as  such
abandonment  is established  pursuant to Section 1951.3 of the California  Civil
Code, as such code section is amended or replaced from time to time.

            (d) Any financial statement or any representation  given to Landlord
by Tenant, or any assignee, sublessee or successor of Tenant or any guarantor of
this Lease, proves to be materially false.

            (e) The insolvency of Tenant; the making by Tenant of any assignment
for the benefit of creditors;  the filing by or against  Tenant of a petition to
have Tenant adjudged bankrupt or of a petition for reorganization or arrangement
under any law relating to bankruptcy, insolvency or creditors' rights in general
(unless in the case of a petition  filed against  Tenant,  the same is dismissed
within  sixty (60)  days);  the  appointment  of a trustee or  receiver  to take
possession  of all or a  substantial  part of  Tenant's  assets  or of  Tenant's
interest under this Lease,  where such seizure is not  discharged  within thirty
(30)  days.  The  occurrence  of any of the acts or events  referred  to in this
subparagraph  with respect to any  guarantor of this Lease,  if any,  shall also
constitute a default hereunder.


                                       25
<PAGE>


            (f)  The  attachment,  execution  or  other  judicial  seizure  of a
substantial  portion of Tenant's  assets  located at the Premises or of Tenant's
interest in this Lease,  where such seizure is not discharged within thirty (30)
days.

            (g) The breach of the  provisions of Section 6.6  concerning  animal
research.

            (h) The breach of any obligation of Tenant under this Agreement with
respect to the use, disposal, handling, or storage of Hazardous Materials.

      The notices  referred to in clauses (a) and (b) above shall be in lieu of,
and not in addition to, any notice  required  under  Section 1161 et seq. of the
California Code of Civil Procedure.

                                 ARTICLE XVIII

                                    REMEDIES

      18.1 Termination of Lease and Removal of Tenant.  In the event of Tenant's
breach of or default  under  this Lease as  provided  in  Article  XVII  hereof,
Landlord,  at Landlord's opinion,  and without limiting Landlord in the exercise
of any other right or remedy  Landlord may have on account of such default,  and
without any further demand or notice,  may terminate  this Lease and/or,  to the
extent  permitted  by law,  remove all persons and property  from the  Premises,
which  property  shall be stored by Landlord at a warehouse  or elsewhere at the
risk, expense and for the account of Tenant.

      18.2 Damages.  If Landlord  elects to terminate  this Lease as provided in
Section  18.1  above,  Landlord  shall be  entitled  to recover  from Tenant the
aggregate of:

            (a) The worth at the time of award of the  unpaid  rent and  charges
equivalent to rent earned as of the date of the termination hereof;

            (b) The worth at the time of award of the amount by which the unpaid
rent and charges  equivalent to rent which would have been earned after the date
of termination  hereof until the time of award exceeds the amount of such rental
loss that Tenant proves could have been reasonably avoided;

            (c) The worth at the time of award of the amount by which the unpaid
rent and charges equivalent to rent for the balance of the Term hereof after the
time of award  exceeds the amount of such rental loss that Tenant  proves  could
have been reasonably avoided;

            (d) Any  other  amount  necessary  to  compensate  Landlord  for the
detriment  proximately  caused by Tenant's  failure to perform  its  obligations
under this Lease or which, in the ordinary course of things,  would be likely to
result therefrom; and

            (e) Any other amount which  Landlord may  hereafter be permitted to.
recover from Tenant to compensate  Landlord for the detriment caused by Tenant's
default.  For the purposes of this  Section,  the "time of award" shall mean the
date upon which the judgment in any action brought by Landlord against Tenant by
reason  of such  default  is  entered  or such  earlier  date as the  court  may
determine;  the  "worth  at the time of  award" of the  amounts  referred  to in
Sections  18.2(a)  and 18.2(b)  shall be  computed  by allowing  interest at the
lesser of the



                                       26
<PAGE>


Lease Rate plus three (3)  percentage  points or the maximum  rate  permitted by
law;  and the "worth at the time of award" of the amount  referred to in Section
18.2(c) shall be computed by discounting such amount at the discount rate of the
Federal Reserve Bank of San Francisco at the time of award plus one percent (1%)
per annum.  Tenant  agrees that such charges  shall be  recoverable  by Landlord
under  California  Code of  Civil  Procedure  Section  1174(b)  or any  similar,
successor  or  related  provision  of law.  Further,  Tenant  hereby  waives the
provisions of California Code of Civil Procedure  Section 1174(c) and California
Civil Code Section 1951.7 or any other similar,  successor or related  provision
of law providing for Tenant's  right to satisfy any judgment in order to prevent
a forfeiture of this Lease or requiring  Landlord to deliver  written  notice to
Tenant of any  reletting  of the  Premises.  No acts or efforts of  Landlord  to
mitigate  damages  caused by Tenant's  breach or default  shall be  construed or
operate to waive or reduce any  damages or other sums  recoverable  by  Landlord
hereunder  (provided,  however,  that Landlord shall under no  circumstances  be
obligated to so mitigate any such damages).

      18.3 No Effect on Indemnification. Nothing in this Article shall be deemed
to affect  Landlord's  right to  indemnification  for  liability or  liabilities
arising prior to the termination of this Lease under the indemnification  clause
or clauses contained in this Lease.

      18.4 No Acceptance of Surrender.  Notwithstanding anything to the contrary
set  forth  herein,  Landlord's  reentry  to  perform  acts  of  maintenance  or
preservation  of, or in  connection  with efforts to relet,  the Premises or any
portion thereof, or the appointment of a receiver upon Landlord's  initiative to
protect Landlord's interest under this Lease, shall not terminate Tenant's right
to possession of the Premises or any portion  thereof and,  until  Landlord does
elect to  terminate  this  Lease,  this Lease  shall  continue in full force and
Landlord may pursue all its remedies hereunder,  including,  without limitation,
the right to recover from Tenant as they become due hereunder all rent and other
charges required to be paid by Tenant under the terms of this Lease.

      18.5  Action for Rent.  In the event of any default by Tenant as set forth
above, then in addition to any other remedies available to Landlord at law or in
equity or under this Lease,  Landlord shall have the right to bring an action or
actions  from  time  to  time  against   Tenant,   in  any  court  of  competent
jurisdiction,  for all rent and other sums due or becoming due under this Lease,
including  all damages and costs  proximately  caused  thereby,  notwithstanding
Tenant's  abandonment  or vacation of the  Premises or other acts of Tenant,  as
permitted  by Section  1951.4 of the  California  Civil  Code or any  successor,
related or similar  provision  of law.  Such remedy may be exercised by Landlord
without prejudice to its right to thereafter  terminate this Lease in accordance
with the other provisions contained in this Article.

      18.6  Definition of Rent.  The terms "rent" and "rental",  as used in this
Article  and in any and all other  provisions  of this  Lease,  shall mean Basic
Annual  Rent and any and all other  amounts  payable by Tenant  pursuant  to the
provisions of this Lease.

      18.7 Reletting. In the event of Tenant's abandonment of the Premises or if
Landlord  shall  elect to  reenter  or shall  take  possession  of the  Premises
pursuant to any legal  proceeding or pursuant to any notice provided by law, and
until Landlord elects to terminate this Lease,  Landlord may, from time to time,
without terminating this Lease, recover all rent as it becomes due under Section
18.5 above  and/or relet the Premises or any part thereof for the account of and


                                       27
<PAGE>


on behalf of Tenant,  on any terms, for any term (whether or not longer than the
Term of this Lease) and at any rent as Landlord in its reasonable discretion may
deem  advisable,  and  Landlord  may make any  alterations  and  repairs  to the
Premises in connection  therewith.  Tenant hereby  irrevocably  constitutes  and
appoints Landlord as its special attorney-in-fact,  irrevocable and coupled with
an interest,  for purposes of reletting the Premises pursuant to the immediately
preceding  sentence.  In the event  that  Landlord  shall  elect to so relet the
Premises on behalf of Tenant, then rent received by Landlord from such reletting
shall be applied:

            (a) First, to reimburse  Landlord for the costs and expenses of such
reletting  (including,  without  limitation,  costs and  expenses of retaking or
repossessing the Premises, removing persons and property therefrom, securing new
tenants,  and, if Landlord  shall  maintain and operate the Premises,  the costs
thereof) and necessary or reasonable alterations.

            (b) Second, to the payment of any indebtedness of Tenant to Landlord
other than Basic Annual Rent and other sums due and unpaid hereunder.

            (c) Third, to the payment of rent,  Basic Annual Rent and other sums
due and unpaid hereunder, and the residue, if any, shall be held by Landlord and
applied in payment of other or future  obligations  of Tenant to Landlord as the
same may become due and payable.

      Should the rent received from such  reletting,  when applied in the manner
and order indicated  above, at any time be less than the total amount owing from
Tenant  pursuant  to this  Lease,  then  Tenant  shall  pay such  deficiency  to
Landlord, and if Tenant does not pay such deficiency within five (5) days of its
receipt of  written  notice,  Landlord  may bring an action  against  Tenant for
recovery of such deficiency or may pursue its other remedies  hereunder or under
California Civil Code Section 1951.8, California Code of Civil Procedure Section
1161 et seq., or any similar, successor or related provision of law.

      18.8  Cumulative  Remedies.  All rights,  powers and  remedies of Landlord
hereunder  and under any  other  agreement  now or  hereafter  in force  between
Landlord  and Tenant shall be  cumulative  and not  alternative  and shall be in
addition  to all  rights,  powers and  remedies  given to  Landlord at law or in
equity.  The  exercise of any one or more of such  rights or remedies  shall not
impair  Landlord's  right to  exercise  any other  right or  remedy,  including,
without limitation, any and all rights and remedies of Landlord under California
Civil  Code  Section 1951.8,   California  Code of Civil Procedure  Section 1161
et~., or any similar, successor or related provision of law.

      18.9  Assignment  of Subrents.  As security for Tenant's  performance  and
satisfaction  of each and every one of its  duties  and  obligations  under this
Lease, Tenant does hereby assign and grant to Landlord a security interest under
the California  Commercial Code in and to Tenant's  right,  power and authority,
during the continuance of this Lease, to receive the rents,  issues,  profits or
other  payments  received under any sublease or other transfer of part or all of
Tenant's interest in the Premises,  reserving unto Tenant the right prior to any
default  hereunder to collect and retain said rents,  issues and profits as they
become due and payable,  except that nothing contained herein shall be construed
to alter the  provisions of Article XV above.  Upon any such  default,  Landlord
shall have the right at any time  thereafter,  without  notice (except as may be
provided for herein),  either in person, by agent or receiver to be appointed by
a court,  to enter



                                       28
<PAGE>


and take possession of said Premises mid collect such rents, issues,  profits or
other payments,  including,  without limitation,  those past due and unpaid, and
apply the same,  less  costs and  expenses  of  collection,  including,  without
limitation, reasonable attorneys' fees, upon any indebtedness secured hereby and
in such order as Landlord may determine.

      18.10 Storage of Personal Property.  If, after Tenant's abandonment of the
Premises,  Tenant  leaves behind any items of personal  property,  then Landlord
shall  store such  property at a  warehouse  or any other  location at the risk,
expense and for the account of Tenant,  and such property shall be released only
upon  Tenant's  payment of such  charges,  together  with all sums due and owing
under this Lease.  If Tenant does not reclaim  such  property  within the period
permitted by law,  Landlord may sell such  property in  accordance  with law and
apply the proceeds of such sale to any sums due and owing  hereunder,  or retain
said property,  granting  Tenant credit against sums due and owing hereunder for
the reasonable value of such property.

      18.11 Waiver. To the maximum extent permitted by law, Tenant hereby waives
all  .provisions  of, or  protection  under,  any  decisions,  statutes,  rules,
regulations  or other laws of the State of California to the extent the same are
inconsistent  with the terms and  provisions  hereof,  including  all rights and
remedies of Landlord provided under this Article.

      18.12 Landlord's Cure of Tenant's Default.  If at any time during the Term
hereof Tenant fails, refuses or neglects to do any of the things herein provided
to be done by Tenant,  Landlord shall have the right, upon five (5) days written
notification  to  Tenant,  but not the  obligation,  to do the same,  but at the
expense  and for the  account of Tenant.  The amount of any money so expended or
obligations so incurred by Landlord, together with interest thereon at the Lease
Rate,  shall be repaid to Landlord  within five (5) days of Tenant's  receipt of
written  notice,  and  unless so paid  shall be added to the next  monthly  rent
payment coming due hereunder.

      18.13  Interest and Charges on Past Due  Obligations.  Any amount due from
Tenant to Landlord  hereunder  which is not paid when due shall bear interest at
the Lease  Rate from the due date  until  paid,  unless  otherwise  specifically
provided  herein,  but the payment of such interest shall not excuse or cure any
such default by Tenant under this Lease.  In addition to such  interest,  if any
monthly  installment  of Basic Annual Rent is not paid within three (3) business
days  after the same is due, a late  charge  equal to six  percent  (6%) of such
monthly installment shall be assessed, which late charge Tenant hereby agrees is
a  reasonable  estimate  of the  damages  Landlord  shall  suffer as a result of
Tenant's   late   payment,   which   damages   include   Landlord's   additional
administrative  and other costs  associated with such late payment.  The parties
agree that it would be impracticable  and extremely  difficult to fix Landlord's
actual  damages in such event.  Such  interest  and late payment  penalties  are
separate  and  cumulative  and are in  addition  to and  shall not  diminish  or
represent a substitute for any or all of Landlord's rights or remedies under any
other provision of this Lease.


                                       29
<PAGE>


                                  ARTICLE XIX

                              RULES AND REGULATIONS

      Tenant shall  observe  faithfully  and comply  strictly with the rules and
regulations ("Rules and Regulations") contained in EXHIBIT E attached hereto, as
amended or  supplemented  by Landlord from time to time.  Landlord  shall not be
liable to Tenant for violation by any other tenant in the Building of any of the
Rules and  Regulations,  or for the breach of any  covenant or  condition in any
lease.  Landlord has not and is not hereby  representing that all tenants in the
Building are or shall be bound to any part or all of the Rules and Regulations.

                                   ARTICLE XX

                              SURRENDER OF PREMISES

      20.1 Surrender.  Upon the expiration or sooner  termination of the Term of
this Lease,  Tenant shall surrender the Premises in good  condition,  reasonable
wear and tear excepted, broom clean and free of trash and rubbish. If Tenant has
not been in default  beyond any  applicable  cure period under any  provision of
this Lease and is not then in default, upon the expiration or sooner termination
of the Term of this Lease,  then Tenant may remove the trade  fixtures set forth
on EXHIBIT F attached  hereto and Tenant's  Alterations,  provided  that, in the
case of Tenant's  Alterations,  such  alterations  shall be removed  only to the
extent they have not become a part of the Premises. Tenant shall promptly repair
any  damage to the  Premises  occasioned  by the  removal of such  fixtures  and
alterations.  In any event,  Landlord may require that Tenant  remove all or any
portion of such  fixtures  and  Tenant's  Alterations  upon such  expiration  or
termination,  in which event  Tenant  shall cause such  removal to occur and all
damage arising out of such removal  repaired.  All other Tenant's Property shall
be removed by Tenant upon such expiration or  termination.  Tenant shall repair,
at its own cost,  any and all damage to the Premises and the Building  resulting
from or caused by any removal hereunder.

      20.2 No Merger.  The voluntary or other surrender of this Lease by Tenant,
or termination hereof,  shall not constitute a merger, and shall operate, at the
option of  Landlord,  as an  assignment  to Landlord of any or all  subleases or
subtenancies affecting the Premises.

                                  ARTICLE XXI

                                  HOLDING OVER

      Should Tenant, with or without Landlord's written consent, hold over after
the  expiration  or earlier  termination  of this Lease,  Tenant  shall become a
tenant from  month-to-month  only upon each and all of the terms herein provided
as may reasonably  and logically be construed as applicable to a  month-to-month
tenancy,  and any such  holding over shall not  constitute  an extension of this
Lease. During such holding over without Landlord's written consent, Tenant shall
pay, in advance,  monthly rent at the highest  monthly rate  provided for herein
(including  any and all prior  adjustments)  plus an amount equal to one hundred
and fifty percent  (150%)  thereof.  Nothing  contained in the  foregoing  shall
relieve  Tenant from,  and Tenant shall remain liable for,  damages  incurred by
Landlord as a result of any such hold over.


                                       30
<PAGE>


                                  ARTICLE XXII

                                     NOTICES

      Any notice,  consent or  communication  to Landlord or Tenant  required or
permitted  to be given  under this Lease shall be  effectively  given only if in
writing and: (a) personally  served;  (b) mailed by United States  registered or
certified mail,  postage  prepaid,  return receipt  requested;  or (c) sent by a
nationally  recognized  courier  service  (e.g.,  Federal  Express) for next day
delivery, to be confirmed in writing by such courier, addressed as follows:

           If to Tenant, as follows:

                                        Kristin P.  Demetriou, Secretary
                                        Arbios Technologies, Inc.
                                        9899 Santa Monica Boulevard, #252
                                        Beverly Hills, CA 90212
                                        Fax: (310) 471-0765

           If to Landlord, as follows:

                                          Cedars-Sinai Medical Center
                                          8700 Beverly Boulevard
                                          North Tower - 2010
                                          Los Angeles, CA 90048-1869
                                          Attention: Dan Oshiro
                                                     Vice President of Research
                                                     Administration

           With copy to:

                                          Cedars-Sinai Medical Center
                                          8700 Beverly Boulevard
                                          TBS 290
                                          Los Angeles, CA 90048-1869
                                          Attention: Peter Braveman, Esq.
                                                     Senior Vice President of
                                                     Legal Affairs and General
                                                     Counsel

And with a copy to any and all Superior Interest Holders, but only as previously
requested in writing by Landlord.

      Either  party shall have the right to change the address or  addresses  to
which  notices  shall  thereafter be sent by giving notice to the other party as
aforesaid.  Notices given in the manner aforesaid shall be deemed delivered when
actually  received  or refused by the party to whom sent,  unless such notice is
mailed as aforesaid,  in which event such notice shall be deemed complete on the
day of actual  delivery as shown by the return  receipt or at the  expiration of
the third (3rd) business day after the date of mailing, whichever first occurs.


                                       31
<PAGE>


                                 ARTICLE XXIII

                                 QUIET ENJOYMENT

      So long  as  Tenant  performs  and  observes  all of its  obligations  and
covenants hereunder and is not in default hereunder, Tenant shall have the right
to the quiet and peaceful  enjoyment and  possession of the Premises  during the
Term of this Lease  without  hindrance or ejection by anyone  lawfully  making a
claim by,  through,  or under  Landlord,  subject to the terms and conditions of
this Lease and of any ground leases,  underlying  leases,  mortgages or deeds of
trust affecting all or any portion of the Project.

                                  ARTICLE XXIV

                              ESTOPPEL CERTIFICATE

      Tenant  shall,  at any time and from  time to time,  within  ten (10) days
after written notice from Landlord, execute, acknowledge and deliver to Landlord
a statement in writing,  in a form  provided by Landlord to Tenant,  certifying,
among other things,  that this Lease is unmodified  and in full force and effect
(or, if modified,  stating the nature of such  modification  and certifying that
this Lease, as so modified, is in full force and effect), the dates to which the
rent and other  charges,  if any, are paid in advance and the amount of Tenant's
security  deposit,  if any,  and  acknowledging  that there are not, to Tenant's
knowledge,  any uncured  defaults on the part of  Landlord  hereunder,  and that
there are no events or conditions then in existence  which,  with the passage of
time or notice or both,  would  constitute  a  default  on the part of  Landlord
hereunder  (or  specifying  such  defaults,  events  or  conditions,  if any are
claimed).  It is expressly  understood and agreed that any such statement may be
relied upon by any prospective  purchaser or encumbrancer of all or a portion of
the Project. Tenant's failure to deliver such statement shall, at the Landlord's
election,  be conclusive upon Tenant that this Lease is in full force and effect
without modification (except as may be represented by Landlord),  that there are
no uncured defaults in Landlord's performance, and that no more than one month's
rent has been  paid in  advance.  Tenant  shall be liable  to  Landlord  for any
consequential damages suffered by Landlord and occasioned by Tenant's failure to
deliver such certificates in the manner described above.

                                  ARTICLE XXV

                              LIABILITY OF LANDLORD

      In the event of any transfer or transfers  of  Landlord's  interest in the
Premises,  other  than a transfer  for  security  purposes  only,  Landlord  (or
Landlord's   successor-in-interest  as  a  transferor)  shall  be  automatically
relieved  of any and all  obligations  and  liabilities  on the part of Landlord
accruing hereunder from and after the date of such transfer,  including, without
limitation,  the payment of the leasing commission,  if any, due with respect to
this Lease.  Tenant agrees to look solely to Landlord's  interest in the Project
(or the proceeds  thereof) for the  satisfaction of any remedy of Tenant for the
collection of a judgment (or other  judicial  process)  requiring the payment of
money by  Landlord in the event of any  default by  Landlord  hereunder,  and no
other  property or assets of  Landlord  shall be subject to levy,  execution  or
other  enforcement  procedure for the satisfaction of Tenant's remedies under or
with respect to this Lease.


                                       32
<PAGE>


                                  ARTICLE XXVI

                         LANDLORD'S INABILITY TO PERFORM

      This Lease and the  obligations of Tenant  hereunder shall not be affected
or  impaired  because  Landlord  is unable  to  fulfill  any of its  obligations
hereunder  or is  delayed in doing so, if such  inability  or delay is caused by
reason of the inability of Landlord to obtain the necessary building permits and
other  governmental  approvals  required to construct  any  improvements  to the
Building,  the  unavailability of materials,  strikes or other labor troubles or
any other  cause  beyond the control of  Landlord,  except as may  otherwise  be
specifically  set  forth in this  Lease.  Landlord  shall not be deemed to be in
default in ~the  performance  of any  obligation  required to be performed by it
hereunder  unless and until Landlord or any beneficiary  under any deed of trust
or any  mortgage,  ground lessor or other  lienholder  with rights in all or any
portion of the Project has failed to perform such obligation  within thirty (30)
days after written notice by Tenant to Landlord  specifying wherein Landlord has
failed to perform  such  obligation;  provided,  however,  that if the nature of
Landlord's  obligation  is such that more than thirty (30) days are required for
its performance,  then Landlord shall not be deemed to be in default if Landlord
or any of such other parties shall commence such performance  within such thirty
(30) day period and thereafter diligently prosecutes the same to completion.

                                 ARTICLE XXVII

                                 ATTORNEYS' FEES

      In the event of any litigation  between Tenant and Landlord to enforce any
provision of this Lease or otherwise  with respect to the subject matter hereof,
the unsuccessful  party in such litigation shall pay to the successful party all
costs and expenses,  including  reasonable  attorneys' fees, incurred therein by
the  successful  party.  If either party hereto without fault is made a party to
any  litigation  instituted  by or against the other  party to this Lease,  such
other party shall indemnify the party who without fault has been made a party to
such  litigation  and save it harmless  from all costs and  expenses,  including
reasonable attorneys' fees, incurred by it in connection therewith.

                                 ARTICLE XXVIII

                                    SERVICES

      28.1 Provision of Services. So long as Tenant is not in default hereunder,
Landlord  agrees to provide to the Premises the following  Building  services on
the  same  basis  as such  services  are  provided  from  time to time to  other
occupants of the Building: elevator, electrical, water, heating, ventilating and
air conditioning,  janitorial and security  services.  Landlord shall provide to
the Premises heating,  ventilation,  and air conditioning twenty-four (24) hours
daily. With respect to security  services,  Tenant may: (a) subject to the other
provisions of this Lease,  cause a separate  security system to be installed for
the Premises,  provided that the same shall not limit Landlord's right of access
to the Premises;  or (b) if practicable,  tie into any central Building security
system, provided that Tenant shall, upon demand by Landlord, pay to Landlord all
incremental costs incurred by Landlord from time to time in connection with such
tie-in.

      28.2  Interruption  of  Services.  Landlord  shall not be  liable  for any
failure to  furnish,  stoppage  of, or  interruption  in  furnishing  any of the
services or  utilities  described  in this  Article


                                       33
<PAGE>


XXVIII when such  failure is caused by  accident,  breakage,  repairs,  strikes,
lockouts,  labor disputes, labor disturbances,  governmental  regulation,  civil
disturbances, acts of war, moratorium or other governmental action, or any other
cause beyond Landlord's reasonable control, and, in such event, Tenant shall not
be  entitled  to any  damages  nor shall any  failure or  interruption  abate or
suspend Tenant's  obligation to pay rent required under this Lease or constitute
or be construed as a constructive or other eviction of Tenant.  Further,  in the
event any  governmental  authority or public utility  promulgates or revises any
law,  ordinance,  rule or regulation,  or issues mandatory controls or voluntary
controls  relating to the use or  conservation of energy,  water,  gas, light or
electricity, the reduction of automobile or other emissions, or the provision of
any other  utility or  service,  Landlord  may take any  reasonably  appropriate
action to comply with such law, ordinance,  rule, regulation,  mandatory control
or voluntary guideline and Tenant's obligations  hereunder shall not be affected
by any such action of Landlord. The parties acknowledge that safety and security
devices,  services and programs provided by Landlord,  if any, while intended to
deter crime and ensure safety, may not in given instances prevent theft or other
criminal acts, or ensure safety of persons or property. The risk that any safety
or security device, service or program may not be effective, or may malfunction,
or be circumvented by a criminal,  is assumed by Tenant with respect to Tenant's
property and interests, and Tenant shall obtain insurance coverage to the extent
Tenant  desires  protection  against such  criminal  acts and other  losses,  as
further  described in this Lease.  Tenant agrees to cooperate in any  reasonable
safety or security program developed by Landlord or required by Law.

      28.3 Compliance with Service Related Regulations. Tenant shall comply with
all rules and regulations which Landlord may reasonably establish for the proper
functioning  and  protection  of the  heating,  ventilating,  air  conditioning,
plumbing and other mechanical systems, and Tenant shall in no event use the same
in any manner vocative of any governmental law or regulation.

      28.4 Additional  Building Service  Demands.  Tenant shall not use, without
the prior written  consent of Landlord,  any apparatus or device in the Premises
(including, but not limited to, electronic data processing machines and machines
using  current in excess of 110 volts) which will in any way increase the amount
of  electricity,  water or  compressed  air (if  compressed  air is furnished by
Landlord)  normally  furnished  or supplied for use of the Premises as space for
Biomedical  Activities,  nor shall Tenant connect with electric  current (except
through  existing  electrical  outlets in the  Premises,  or water  pipes or air
pipes,  if there are any) any  apparatus  or  device  for the  purpose  of using
electric  current  or water or air.  Tenant  shall  cause a water  meter  and an
electric  current meter to be installed so as to measure the amount of water and
electric  current  consumed  for its use of the  Premises.  The cost of any such
meters and of installation,  maintenance and repair thereof shall be paid for by
Tenant, and,  notwithstanding  anything contained in this Lease to the contrary,
Tenant  agrees to pay  Landlord,  promptly  upon demand,  for all such water and
electric  current consumed as shown by said meters at the rates charged for such
services by the  jurisdiction  in which the  Building is located or by the local
public  utility  furnishing  the  same,  whichever  the  case  may be,  plus any
additional expense incurred in keeping account of the water and electric current
so consumed.

      28.5  Modification of Services.  Notwithstanding  anything herein above to
the contrary,  Landlord  reserves the right from time to time to make reasonable
and  nondiscriminatory  modifications  to the above  standards for utilities and
services.


                                       34
<PAGE>


      28.6 Special Services.  At any time during the Term of this Lease, Tenant,
at its sole  option,  may elect to  purchase  from  Landlord  any of the special
services  identified  in EXHIBIT C attached  hereto.  The rates for such special
services shall be established  by Landlord in its sole  discretion  from time to
time and are subject to change.

                                  ARTICLE XXIX

                               GENERAL PROVISIONS

      29.1 Headings. The section and subsection headings contained in this Lease
are for  convenience  only and do not in any way  limit or  amplify  any term or
provision hereof.

      29.2 Plurals and Genders. The terms "Landlord" and "Tenant" as used herein
shall include the plural as well as the  singular,  and the neuter shall include
the masculine and feminine genders.

      29.3  "Persons"  Defined.  The words  "person" or "persons" as used herein
shall include individuals, firms, associations and corporations.

      29.4 Covenants and Agreements:  Time of the Essence. All of the provisions
of this Lease are to be  construed  as covenants  and  agreements  as though the
words  importing  such  covenants  and  agreements  were  used in each  separate
provision hereof. Each of Tenant's covenants and agreements herein contained are
conditions,  the time of which is of the essence,  and the strict performance of
each shall be a condition precedent to Landlord's  obligations hereunder and the
right of Tenant to remain in  possession  of the Premises and to have this Lease
continue in effect.

      29.5  Successors  and  Assigns.  All  of  the  covenants,  conditions  and
provisions of this Lease shall be binding upon and shall inure to the benefit of
the  parties  hereto  and  their  respective  heirs,  personal  representatives,
successors  and assigns,  subject at all times,  however,  to all agreements and
restrictions contained in Article XV hereof.

      29.6  Interpretation.  The language in all parts of this Lease shall be in
all cases construed simply  according to its fair meaning,  and not strictly for
or against  Landlord or Tenant.  Any  reference  to any Article  herein shall be
deemed  to  include  all  subsections  thereof  unless  otherwise  specified  or
reasonably required from the context. Any reference to "days" or "months" herein
shall  refer to  calendar  days or  months,  respectively,  unless  specifically
provided to the contrary.  The terms "herein,"  "hereunder" and "hereof' as used
in this  Lease  shall  mean "in this  Lease,"  "under  this  Lease" and "of this
Lease," respectively, except as otherwise specifically set forth in this Lease.

      29.7 Waiver and  Default.  No waiver by Landlord of any  provision of this
Lease  shall be deemed to be a waiver  of any other  provision  hereof or of any
subsequent breach by Tenant of the same or any other provision.  No delay on the
part of Landlord in exercising  any of its rights  hereunder  shall operate as a
waiver of such  rights or of any other right of  Landlord,  nor shall any delay,
omission  or waiver on any one  occasion be deemed a bar to, or a waiver of, the
same or any other right on any other  occasion.  Neither  Landlord's  failure to
bill Tenant for any rent as it becomes due hereunder,  nor  Landlord's  error in
such  billing  or  failure  to provide  any other  documentation  in  connection
therewith,  shall  operate as a waiver of  Landlord's  right to collect



                                       35
<PAGE>


any such rent which may have at any time become due hereunder in the full amount
to which Landlord is entitled pursuant to the terms hereof,  except as otherwise
may be specifically set forth in this Lease.  Landlord's  consent to or approval
of any act by Tenant  requiring  Landlord's  consent  or  approval  shall not be
deemed. to render unnecessary the obtaining of Landlord's consent to or approval
of any  subsequent  act of Tenant whether or not similar to the act so consented
to or approved. No act or thing done by Landlord or Landlord's agents during the
Term of this Lease shall be deemed an acceptance of a surrender of the Premises,
and no agreement to accept such surrender shall be valid,  unless in writing and
signed by Landlord.  No employee of Landlord or Landlord's agents shall have any
power to accept the keys to the Premises prior to the  termination of this Lease
and the  delivery  of the keys to any  such  employee  shall  not  operate  as a
termination  of this  Lease  or a  surrender  or  Landlord's  acceptance  of the
Premises.  If Tenant at any time desires to have  Landlord  sublet or attempt to
sublet the Premises  for Tenant's  account,  Landlord or  Landlord's  agents are
authorized to receive said keys for such purposes without  releasing Tenant from
any of its obligations under this Lease.

      29.8 Entire  Agreement;  Amendments.  This Lease and the  Exhibits and any
Riders  attached  hereto  constitute  the entire  agreement  between the parties
hereto with  respect to the subject  matter  hereof,  and no prior  agreement or
understanding  pertaining to any such matter shall be effective for any purpose.
No provision of this Lease may be amended or supplemented except by an agreement
in writing signed by the party or parties to be bound thereby.  Tenant  warrants
and  represents  that there have been no  representations  or statements of fact
with respect to the Premises,  the Building,  the surrounding area or otherwise,
whether by  Landlord,  its agents or  representatives,  any lease  broker or any
other person, which representations or statements have in any way induced Tenant
to enter  this Lease or which  have  served as the basis in anyway for  Tenant's
decision to execute this Lease, except as contained in this Lease. Tenant agrees
and  acknowledges  that no lease  broker,  agent or other person has had or does
have the  authority to bind  Landlord to any  statement,  covenant,  warranty or
representation  except as contained in this Lease, and that no person purporting
to hold such authority  shall bind  Landlord,  and that it is not reasonable for
Tenant to have  assumed  that any  person  had or has such  authority.  Further,
neither  Landlord's  execution  of this Lease nor any other of its acts shall be
construed in any way to indicate Landlord's ratification, consent or approval of
any act,  statement or representation of any third person except as specifically
set forth in this Lease.

      29.9 Landlord's Consent or Approval.  Except as may otherwise be expressly
provided herein, Landlord may, in its sole and absolute discretion, withhold any
consent or approval required hereunder.

      29.10  Counterparts.   This  Lease  may  be  executed  in  any  number  of
counterparts, each of which shall be an original and all of which together shall
constitute and be construed as one and the same instrument.

      29.11  Applicable  Law and Venue.  This  Lease  shall be  governed  by and
construed in  accordance  with the laws of the State of  California.  Except for
tire matters required to be arbitrated  pursuant to specific  provisions of this
Lease,  any action to declare or enforce  any rights or  obligations  under this
Lease may be  commenced  by any party in the  Superior  Court or other  Court of
competent  jurisdiction  of the County in which the Building is located.  Tenant
and Landlord hereby consent to the  jurisdiction of such Court for such purposes
and agree that any notice,  complaint or other legal process delivered to Tenant
or Landlord in  accordance  with the  provisions  of Article  XXII of this Lease
shall  constitute  adequate  notice and service of process for all  purposes and
shall subject Tenant and Landlord to the jurisdiction 9f such Court for purposes
of adjudicating any matter related to this Lease. The provisions of this Section
shall also apply to all guarantors of this Lease.


                                       36
<PAGE>


      29.12 Incorporation of Exhibits. All Exhibits or Riders referenced in this
Lease,  if any, are  incorporated  herein by reference as though fully set forth
herein.

      29.13  Reserved  Area.  Tenant  hereby  acknowledges  and agrees  that the
exterior walls of the Building and the area between the finished ceilings of the
Premises  and the slab of the floor of the  Building  there  above have not been
demised  hereby,  and that the use thereof,  together with the right to install,
maintain,  use,  repair and replace  pipes,  ducts,  conduits and wires  leading
through,  under or above the  Premises,  is hereby  excepted and  reserved  unto
Landlord.

      29.14  Brokers.  Tenant and Landlord  each warrant and  represent  that no
person  is, or may be,  entitled  to a  commission,  finder's  fee or other like
payment in connection  herewith.  Landlord and Tenant hereby  indemnify and hold
each other  harmless  from and  against  any and all loss,  liability,  cost and
expense,  including,  without limitation,  reasonable  attorneys' fees, that the
other  party may incur as a result of the  incorrectness  of such  warranty  and
representation.

      29.15 No Option.  The submission of this Lease by Landlord or its agent or
representative  for  examination  or execution by Tenant does not  constitute an
option or offer to lease the Premises  upon the terms and  conditions  contained
herein or a reservation  of the Premises in favor of Tenant;  it being  intended
hereby that this Lease shall become  effective only upon the execution hereof by
Landlord and delivery of a fully executed counterpart hereof to Tenant.

      29.16  Authority.  In the  event  Tenant  is a  corporation,  the  parties
executing this Lease on behalf of Tenant hereby covenant,  represent and warrant
that:  (i) they are duly  authorized to execute and deliver this Lease on behalf
of Tenant;  (ii) Tenant is a duly organized  corporation in good standing,  with
full  right,  power and  authority  to enter into this Lease and to perform  its
obligations  hereunder;  (iii) all necessary  steps have been taken prior to the
date hereof to qualify Tenant to do business in  California;  (iv) all franchise
and  corporate  taxes have been paid as of the date  hereof;  and (v) all future
forms,  reports,  fees. and other documents  necessary to comply with applicable
laws will be filed when due. In the event Tenant is a  partnership,  the parties
executing  this Lease on behalf of Tenant hereby  covenant and warrant that: (i)
they are duly  authorized to execute and deliver this Lease on behalf of Tenant;
and (ii)  Tenant is a duly  organized  partnership  with full  right,  power and
authority  to enter into this Lease and to perform  its  obligations  hereunder.
Tenant shall  deliver to Landlord such evidence of the foregoing as Landlord may
request.

      29.17  Recordation  of Lease.  At the  request  of any  Superior  Interest
Holder,  or in its own  discretion,  Landlord  shall record a memorandum of this
Lease.  Tenant  shall  not  record,  or cause to be  recorded,  this  Lease or a
memorandum of this Lease without Landlord's prior written consent.


                                       37
<PAGE>


      29.18  Multiple  Parties.  If  there  is  more  than  one  person,   firm,
corporation,  partnership or other entity comprising Tenant,  then: (i) the term
"Tenant" as used herein  shall  include  all of the  undersigned;  (ii) each and
every  provision  in this  Lease  shall be  binding on each and every one of the
undersigned; (iii) each of the undersigned shall be jointly and severally liable
hereunder;  (iv)  Landlord  shall  have  the  right  to  join  one or all of the
undersigned  in any  proceeding  or to proceed  against  them in any order;  (v)
Landlord  shall  have the right to  release  any one or more of the  undersigned
without in any way prejudicing its right to proceed against the others; and (vi)
the act of or notice from,  or notice or refund to, or the signature of, any one
or more of them, with respect to the tenancy of this Lease,  including,  but not
limited to, any renewal,  extension,  expiration or  modification of this Lease,
shall be binding upon each and all of the persons executing this Lease as Tenant
with the same  force  and  effect  as if each and all of them had so acted or so
given or received such notice or refund or so signed.

      29.19 No  Violation  of  Other  Agreements.  Tenant  hereby  warrants  and
represents that neither its execution of nor performance  under this Lease shall
cause Tenant to be in violation of any  agreement,  instrument,  contract,  law,
rule or  regulation  by which  Tenant is bound,  and Tenant  agrees to indemnify
Landlord  against  any loss,  cost,  damage  or  liability,  including,  without
limitation,  reasonable  attorneys' fees, arising out of Tenant's breach of this
warranty and representation.

      29.20 Adjacent Land. If an excavation  shall be made upon land adjacent to
the  Building,  or shall be  authorized  to be made,  Tenant shall afford to the
person causing or authorized to cause such excavation  license to enter upon the
Premises at reasonable  times, for the purpose of doing such work as said person
shall deem  necessary to preserve the wall of the Building of which the Premises
form a part from injury or damage, and to support the same by proper foundations
without any claim for damages or indemnity  against  Landlord or  diminution  or
abatement of rent.

      29.21 Building Directory.

            (a) Tenant may not place any sign  inside or  outside  the  Building
without the  consent of  Landlord,  except an  entrance  door sign in a size and
style  approved by Landlord and subject to all  applicable  laws and  covenants,
conditions or restrictions affecting the Project.

            (b) Landlord shall provide a directory (which, at Landlord's option,
may be  computerized)  in the main  lobby of the  Building  listing  the name of
Tenant.

      29.22 Parking.  Landlord shall use its good faith efforts to assist Tenant
so that,  concurrently  with the  execution  of this  Lease,  Tenant  may obtain
parking rights for unreserved parking spaces at the Cedars-Sinai  Medical Office
Building (located at the corner of Alden Drive and George Burns Road) at current
prevailing  parking  rates  available to  employees  of Landlord for  unreserved
parking spaces.  Tenant  acknowledges  that Landlord does not own or operate the
Cedars-Sinai  Medical Office Building and further  acknowledges that Landlord is
not  agreeing  to supply  parking to Tenant  pursuant to this Lease and that the
issuance of parking rights is not a condition to Tenant's obligations under this
Lease.


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<PAGE>


      29.23 Subdivision;  Mutual  Cooperation.  Landlord shall have the right to
subdivide  the  Property  and/or  the  Building  at any  time  for  any  purpose
whatsoever,   including,   without  limitation:  (a)  the  purpose  of  creating
condominium  ownership of the Property and the Building;  and (b) the purpose of
constructing,  or financing the construction of, other buildings or improvements
on the  Property.  Tenant agrees to cooperate  with Landlord in completing  such
subdivision and in obtaining any governmental authorization or permits necessary
to  facilitate  the  construction  of any such  additional  improvements  on the
Property,  and to  execute  all  such  documents  and  amendments  to the  Lease
reasonably necessary to effectuate the same. Tenant agrees that upon subdivision
of the Property and/or the Building,  Landlord may sell,  transfer or convey one
or more  portions of the Building  and/or the  Property,  and that title to such
portions may be held in other than the name of Landlord.

      29.24 Name of Building.  Neither Tenant nor any shareholders of Tenant nor
any of their  employees may use the name  "Cedars-Sinai  Medical Center" for any
purpose,  including,  without  limitation,  any advertising or the naming of any
medical group or professional corporation.

      29.25  Rental  Abatement.  Any and all  references  herein to abatement of
Basic  Annual  Rent shall  apply to only those  amounts  which  would  otherwise
thereafter  accrue.  If any dispute  relating to such abatement  occurs,  Tenant
shall pay the rent  demanded by Landlord  pending the final  resolution  of such
dispute.

      29.26 Guarantees.  If any guarantee of this Lease is required by Landlord,
such  guarantee  shall be in a form  provided by Landlord to Tenant and Landlord
may  terminate  this Lease at any time until it receives  such  guarantee  fully
executed by the required guarantors.

      29.27  Severability.  Any  provision of this Lease which shall prove to be
invalid,  void or illegal shall in no way affect, impair or invalidate any other
provision  hereof,  and such  other  provisions  shall  remain in full force and
effect.

      29.28 Waiver of Rights of Redemption.  Tenant hereby  expressly waives any
and all rights of  redemption  granted by or under any present or future laws in
the event that Tenant is evicted or  dispossessed  for any cause or in the event
that Landlord  obtains  possession of the Premises by reason of the violation by
Tenant of any of the  covenants and  conditions of this Lease or otherwise.  The
rights given to Landlord  herein are in addition to any rights that may be given
to Landlord by any statute or otherwise.

      29.29 Light and Air. Any diminution or shutting off of light,  air or view
by any  structure  that may be erected on lands  adjacent to the Building or any
other  portion of the  Project  shall in no manner  affect  this Lease or impose
liability upon Landlord.

      29.30 No Joint  Venture.  The Parties  hereto  acknowledge  and agree that
nothing  contained  in this  Lease  shall be  deemed  or  construed  to create a
partnership or joint venture between Landlord and Tenant or between Landlord and
any other party or causing  Landlord to be  responsible in any way for the debts
or obligations of Tenant or any other party.


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<PAGE>


                                   ARTICLE XXX

                               HAZARDOUS MATERIALS

      30.1 Compliance  Costs.  Tenant  acknowledges  that Landlord may incur, as
Operating  Expenses,  costs for  complying  with  laws,  codes,  regulations  or
ordinances  relating to Hazardous  Materials  (as defined in Section 30.2) on or
about the Project,  including,  without limitation, the following: (i) Hazardous
Materials  present in the soil or ground water on the Project;  (ii) a change in
laws, codes,  regulations or ordinances which relate to Hazardous  Materials and
which makes any  substance  or material  which is present on, in, under or about
the Project as of the date  hereof,  a violation of such  changed  laws,  codes,
regulations  or  ordinances;  (iii)  Hazardous  Materials  that  migrate,  flow,
percolate,  diffuse or in any way move onto or under the Project; (iv) Hazardous
Materials present on or under the Project as a result of any discharge,  dumping
or spilling (whether accidental or otherwise) on the Project by other tenants of
the Project or their agents,  employees,  contractors or invitees, or by others.
Each  item  of cost  incurred  by  Landlord  for  complying  with  laws,  codes,
regulations  or ordinances  relating to Hazardous  Materials with respect to the
Project  (or any portion  thereof)  and which  exceeds  Fifty  Thousand  Dollars
($50,000)  shall  be  amortized  over a five (5)  year  period  from the date of
installation as "Capital Improvement  Amortization" as provided in Section 4.3.2
herein  and  treated  as a  "Capital  Improvement".  To the extent any such cost
relating to Hazardous Materials is subsequently  recovered or reimbursed through
insurance,  or recovery from responsible third parties, or other action,  Tenant
shall be entitled to  proportionate  reimbursement to the extent it has paid its
share of such cost to which such recovery or reimbursement  relates  (regardless
of  whether  such  costs  were  paid  as  Operating  Expenses  or  as a  Capital
Improvement).  Nothing  contained  herein shall be construed to modify  Tenant's
obligation to make full payment for Hazardous  Materials or compliance with laws
pertaining   to  Hazardous   Materials  if  the  cost  of  compliance  or  other
responsibility for such Hazardous Materials is made the responsibility of Tenant
pursuant to any other provision of this Lease or applicable law.

      30.2 Definition.  As used herein, the term "Hazardous Materials" means any
hazardous or toxic substance, material or waste which is or becomes regulated by
any local governmental  authority,  the State of California or the United States
government.  The term "Hazardous  Materials" includes,  without limitation,  any
material or substance which is: (i) defined as a "hazardous  waste,"  "extremely
hazardous waste," or "restricted  hazardous waste" under Section 25115, or 25117
or 25122.7,  or listed  pursuant to Section 25140 of the  California  Health and
Safety Code,  Division 20,  Chapter 6.5  (Hazardous  Waste Control Law); or (ii)
defined as a "hazardous substance," under Section 25316 of the California Health
and Safety Code,  Division 20, Chapter 6.8  (Carpenter-Presley-Tanner  Hazardous
Substance  Account  Act);  (iii) defined as a "hazardous  material,"  "hazardous
substance," or "hazardous  waste" under Section 25501 of the  California  Health
and Safety Code, Division 20, Chapter 6.95 (Hazardous Materials Release Response
Plans and  Inventory);  (iv) defined as a "hazardous  substance"  under  Section
25281 of the  California  Health and  Safety  Code,  Division  20,  Chapter  6.7
(Underground  Storage of Hazardous  Substances);  (v) petroleum;  (vi) asbestos;
(vii)  listed under  Article 9 or defined as  hazardous  or extremely  hazardous
pursuant  to  Article  11 of Title  22 of the  California  Administrative  Code,
Division 4, Chapter 30; (viii) designated as a "hazardous substance" pursuant to
Section 311 of the Federal Water  Pollution  Control Act, 33 U.S.C.  1317;  (ix)
defined as a "hazardous  waste" pursuant to Section 1004 of the Federal Resource
Conservation and Recovery Act, 42 U.S.C.  6901 et seq. (42 U.S.C.  6903); or (x)
defined as "hazardous  substance"  pursuant to Section 101 of the  Comprehensive
Environmental  Response  Compensation and Liability Act, 42 U.S.C.  9601 et seq.
(42 U.S.C. 9601).


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<PAGE>


      IN WITNESS  WHEREOF,  Landlord and Tenant have duly executed this Lease as
of the day and year first written above.


LANDLORD                                        TENANT

CEDARS-SINAI MEDICAL CENTER                     ARBIOS TECHNOLOGIES, INC.


By:  /s/ Daniel M.  Oshiro                      By:  /s/ Kristin P.  Demetriou
     ---------------------------                     ---------------------------
Its:  Vice President                            Its:  Secretary
      for Research Administration




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