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MULTI-TENANT INDUSTRIAL LEASE




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STANDARD FORM MULTI-TENANT INDUSTRIAL LEASE
 TABLE OF CONTENTS
 Section
    
    Title
    
    Page1.
    
    Premises
    
    
    12.
    
    Term
    
    
    23.
    
    Rent
    
    
    34.
    
    Common Area; Operating Expenses
    
    
    35.
    
    Security Deposit
    
    
    66.
    
    Use
    
    
    77.
    
    Payments and Notices
    
    
    98.
    
    Brokers
    
    
    99.
    
    Surrender; Holding Over
    
    
    1010.
    
    Taxes
    
    
    1011.
    
    Possession; Condition of Premises; Repairs
    
    
    1112.
    
    Alterations
    
    
    1213.
    
    Liens
    
    
    1314.
    
    Assignment and Subletting
    
    
    1315.
    
    Entry by Landlord
    
    
    1516.
    
    Utilities and Services
    
    
    1517.
    
    Indemnification and Exculpation
    
    
    1518.
    
    Damage or Destruction
    
    
    1619.
    
    Eminent Domain
    
    
    1720.
    
    Tenants Insurance
    
    
    1821.
    

Landlords Insurance
    
    
    1922.
    
    Waivers of Subrogation
    
    
    1923.
    
    Tenants Default and Landlords Remedies
    
    
    1924.
    
    Landlords Default
    
    
    2125.
    
    Subordination
    
    
    2126.
    
    Estoppel Certificate
    
    
    2127.
    
    Intentionally Omitted
    
    
    2228.
    
    Modification and Cure Rights of Landlords Mortgagees and Lessors
    
    
    2229.
    
    Quiet Enjoyment
    
    
    2230.
    
    Transfer of Landlords Interest
    
    
    2231.
    
    Limitation on Landlords Liability
    
    
    2232.
    
    Miscellaneous
    
    
    2233.
    
    Lease Execution
    
    
    2434.
    
    Intentionally Omitted
    
    
    24EXHIBITSEXHIBIT A
    
    Project Site PlanEXHIBIT  B
    
    Floor PlanEXHIBIT  C
    
    Work Letter AgreementEXHIBIT  D
    
    Sample Form of Notice of Lease Term DatesEXHIBIT  E
    
    Rules and RegulationsEXHIBIT  F
    
    Sample Form of Tenant Estoppel CertificateEXHIBIT  G
    
    Tenant Environmental Questionnaire
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STANDARD FORM MULTI-TENANT INDUSTRIAL LEASE
 INDEX OF DEFINED TERMS
 Term
    
    PageAbandonment
    
    
    19Acceptance
    
    
    6Act
    
    
    12Actual Statement
    
    
    5Applicable Laws
    
    
    7Applicable Reassessment
    
    
    11Audit Notice
    
    
    5BMS
    
    
    6BOMA
    
    
    1Common Area
    
    
    3Construction Allowance
    
    Exhibit CDeclaration
    
    
    3Draw Request
    
    Exhibit CElection Date
    
    
    1Estimate Statement
    
    
    5Evidence of Completion
    
    Exhibit CExtension Option
    
    
    2Extension Options
    
    
    2Fair Market Rental
    
    
    2First Refusal Notice
    
    
    1First Refusal Space
    
    
    1Force Majeure Delays
    
    
    23Hazardous Materials
    
    
    8Increase Date
    
    
    6Indemnified Claims
    
    
    15Initial Reduction Date
    
    
    6Landlord
    
    
    1Landlord Delay
    
    Exhibit CLandlord Indemnified Parties
    
    
    8LC Delivery Date
    
    
    6Lease
    
    
    1Letter of Credit
    
    
    6Lilly
    
    
    6Management Fee
    
    
    3Nondisturbance Condition
    
    
    21Option Period
    
    
    2PCBs
    
    
    8Permitted Business
    
    
    14Permitted Transfer
    
    
    14Permitted Transferee
    
    
    14Pre-Approved Change
    
    
    12Preliminary Plans
    
    Exhibit CProposition 13 Protection Amount
    
    
    11Proposition 13 Purchase Price
    
    
    11Real Property Taxes
    
    
    10Reassessment
    
    
    11Summary
    
    
    1Tax Increase
    
    
    11Tenant
    
    
    1Tenant Change
    
    
    12Tenant Changes
    
    
    12Tenant Improvement Allowance Items
    
    Exhibit CTenant Improvements
    
    Exhibit CTenant Indemnified Parties
    
    
    15Tenant Parties
    
    
    15Tenants Election Notice
    
    
    1Tenants Monthly Operating Expense Charge
    
    
    5Tenants Parties
    
    
    8Tenants Share
    
    
    1Transfer
    
    
    13Transfer Date
    
    
    14Transfer Notice
    
    
    14Transferee
    
    
    14
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SUMMARY
OF BASIC LEASE INFORMATION AND DEFINITIONS
  1.1
    
    Landlords Address:
    
    AEW/LBA Acquisition Co., LLCc/o Layton Bulling Associates10251 Vista Sorrento Parkway, Suite 100Attn: Mr. David C. ThomasTelephone: (619) 597-87951.2
    
    Tenants Address:
    
    Before Commencement Date:Aurora Biosciences Corporation11149 North Torrey Pines RoadSuite 200La Jola, California 02037Attn: Ms. Deborah TowerTelephone: (619) 452-5000After Commencement Date:Aurora Biosciences Corporation11010 Torreyana RoadLa Jola, California 02037Attn: Mr. Deborah TowerTelephone: (819)452-5000
 1.3
    
    Project: The Industrial development located at 11010
Torreyana Road in the City of La Jolla,
County of San Diego, State of California. as shown on the site plan attached hereto as Exhibit
A The Project includes all buildings, improvements and facilities, now or subsequently
located within such development from time to time, including, without limitation, the Building
currently located within the Project, as depicted on the site plan attached hereto as
Exhibit A.1.4
    
    Building: A multi-tenant Industrial building located in the Project, containing 81,204
rentable square feet, the address of which is 11010 Torreyana Road, La Jolla, California
02037.1.5
    
    Premises: Those certain premises within the Building shown on the floor plan attached hereto
as Exhibit B, containing approximately 55,000 rentable square feet on the ground
and third floors.1.6
    
    Monthly Operating Expense Charge: Tenants Share of Operating Expenses as provided in Section
4. Tenants Share is initially 67.73% (see Section 1.3).1.7
    
    Commencement Data: The earner to occur of (i) September 15,1997 or (ii) the data Tenant
commences business operations in the entire Premises. Subject to Section 11.1, Landlord will
deliver the Premises to Tenant within two (2) business days following the full execution and
delivery of this Lease.1.8
    
    Term: Eleven (11) years.1.9
    
    Rent:
 Year
    
    Annual Basic Rent
    
    Monthly Basic Rent1
    
    $
    1,287,000.00
    
    
    $
    107,250.002
    
    $
    1,325,010.00
    
    
    $
    110,487.603
    
    $
    1,385,378.20
    
    
    $
    113,781.524
    
    $
    1.408,339.50
    
    
    $
    117,194.985
    
    $
    1,448,529.60
    
    
    $
    120,710.806
    
    $
    1,491,985.40
    
    
    $
    124,332.127
    
    $
    1,536,744.90
    
    
    $
    128,062.088
    
    $
    1,582,847.20
    
    
    $
    131,903.049
    
    $
    1,630,332.60
    
    
    $
    135,861.0510
    
    $
    1,679,242.50
    
    
    $
    139,936.8811
    
    $
    1,729,619.70
    
    
    $
    144,134.98
 -iii-




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1.10
    
    [Intentionally Omitted]1.11
    
    Security Deposit: See Section 5.1.12
    
    Permitted Use: General office, research and development, screen development and screening
services and the assembly and integration of Tenants ultra-high throughput screening system,
and any other lawful use Incidental thereto.1.13
    
    Brokers: John Bumham & Company representing
Landlord and John Bumham & Company representing
Tenant.1.14
    
    Interest Rate: The lesser of: (a) the rate announced from time to time by Wells Fargo Bank
or, if Wells Fargo Bank ceases to exist or ceases to publish such rate, then the rate
announced from time to time by the largest (as measured by deposits) chartered operating bank
operating in California, as its prime rate or reference rate, plus two percent (2%); or
(b) the maximum rate permitted by law.1.15
    
    Tenant Improvements: The tenant improvements to be installed in the Premises by Tenant as
described in the Work Letter Agreement attached hereto as Exhibit C.
 /s/ Illegible
    
    
    
    /s/ IllegibleLandlords Initials
    
    
    
    Tenants Initials
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MULTI-TENANT INDUSTRIAL LEASE
 Lease Summary Landlord Tenant
 1. Premises
 Premises
 Landlords Reservation of Rights
 Tenants Share. Tenants Share
 Right of First Refusal. First Refusal Space First Refusal Notice Election Data Tenants Election Notice .
 Verification of Rentable Square Feet of Premises and Building. BOMA




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2. Term .
 Term; Notice of Lease Dates Exhibit D
 Early Occupancy of the Ground Floor
 Options to Extend Extension Option Extension Options Option
Period
 Fair Market Rental
  -2-




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3. Rent
 Basic Rent.
 Additional Rent.
 Late Payments.
 Management Fee. [to be based upon .48/rsf when rsf is determined
prior to Lease execution] Management Fee
 Triple-Net Lease.
 Pre-Commencement Date Charges.
 4. Common
Area: Operating Expenses.
 Definition of Common Area. Common Area
 Maintenance and Use of Common Area. Declaration ExhibitE Exhibit E
 Control of and Changes to Common Area.
 -3-




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Operating Expenses.
  (a)
    
    depreciation on the Building and Project;(b)
    
    interest, principal, points and fees on debt or amortization on any mortgages and deeds of
trust or other debt instruments secured by the Building or the Project or any underlying
ground lease;(c)
    
    costs of repairs and general maintenance paid from insurance proceeds but excluding the
amount of any deductibles paid by Landlord;(d)
    
    repairs and replacements covered by warranties or guaranties (to the extent actually
collected by Landlord); and the cost of any repairs, alterations and additions made to
rectify or correct any major defects or significant design errors relating to the initial
design or construction of the Building and Project;(e)
    
    costs of items considered capital repairs, replacements, improvements and equipment under
generally accepted accounting principles consistently applied except for those items
expressly permitted in clause (xii) above;(f)
    
    costs of special services rendered to individual tenants (including Tenant) for which a
special charge is made to the tenant(s) receiving such special services;(g)
    
    costs of improvements for other tenants in the Building or Project;(h)
    
    costs of the Landlord for which a tenant is obligated to separately reimburse Landlord (as
opposed to reimbursement of a pro rata share thereof as an Operating Expense), including, for
example, taxes and property insurance premiums on improvements for tenants of the Building
and Project that are above the building standard;(i)
    
    costs incurred by Landlord in connection with the enforcement of the terms and conditions of
any lease in the Building or Project;(j)
    
    all costs, expenses, penalties, damages, fines and judgments from any investigation, site
monitoring, containment, cleanup, removal, restoration or other remedial work of any kind or
nature required under any local, state or federal law or regulation, any judicial order, or
by any governmental or nongovernmental entity or person as a result of or in connection with
any Hazardous Material or Hazardous Materials contamination;(k)
    
    Landlords general corporate overhead and general and administrative expenses;
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(l)
    
    Marketing costs, including, without limitation, leasing commissions, attorneys fees,
space planning costs and other costs and expenses incurred in connection with the leasing of
the Building or Project; and(m)
    
    Overhead and profit increment paid to Landlord and Landlords subsidiaries for goods and/or
services in or to the Building or Project to the extent the same exceeds the costs of such
goods and/or services rendered by unaffiliated third parties on a competitive basis.
 Tenants Monthly Operating Expense Charge. Tenants Monthly Operating Expense
Charge
 Estimate Statement. Estimate Statement
 Actual Statement. Actual
Statement
 Miscellaneous.
 Books and Records; Audit. Audit Notice
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5. Security Deposit
 Delivery of Letter of Credit. LC Delivery Date Increase Date Letter of Credit
 Increase and Reduction In Principal Amount of Letter of Credit
 Portion of Term
    
    Required Principal AmountLC Delivery Date  Increase Date*
    
    $
    1,250,000.00Increase Date  Initial Reduction Date
    
    $
    2,500,000.00First year following Initial Reduction Date
    
    $
    1,000,000.00Second year following Initial Reduction Date
    
    $
    666,666.00Third Year following Initial Reduction Date
    
    $
    333,333.00Remaining Term
    
    Equal to then-currentMonthly Basic Rent
 Initial Reduction Date and
 (a)
    
    Tenants receipt of payment from Eli Lilly (Lilly) and Bristol Myers Squibb (BMS) upon
Acceptance by each company of the Automated Storage and Retrieval module for the Ultra-High
Throughput Screening System. Evidence of payment will be provided by Tenant and will include
a copy of the check or wire transfer notification and written confirmation by Lilly and BMS
that such payment is made for Acceptance of the Automated Storage and Retrieval module.
Acceptance is defined per existing contract language with BMS and Lilly, which Tenant
represents and warrants to Landlord is accurately described as follows:
 (i)
    
    BMS: When BMS has determined that all Deliverables for the Automated
Storage and Retrieval Module have successfully conformed to or satisfied the
Specifications in all material respects, BMS shall give Aurora written notice thereof
(Acceptance), in which event BMS shall become obligated to pay such amounts as
triggered under this Agreement as a result hereof.(ii)
    
    LILLY: When the LILLY UHTSS Steering Committee has determined that the
Automated Storage and Retrieval module meet the Specifications for such module. Upon
Completion (Acceptance) of the Automated Storage and retrieval module at Lilly, Aurora
shall give Lilly written notice and Lilly shall become obligated to pay such amounts
provided for in the
agreement.
 -6-




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(b)
    
    Tenants entering into an agreement with another major pharmaceutical company that is
similar in scope and nature to Tenants existing agreements with
BMS and Eli Lilly
concerning the production of Tenants Ultra-HTS system.(c)
    
    Completion of an initial public offering of securities in Tenant traded on a United States
stock exchange raising at least Ten Million Dollars ($10,000,000.00) in equity.
  Application of Letter of Credit
 6. Use
 General. Exhibit E
 Applicable Laws
 Parking. Exhibit E
 Signs, Awnings and Canopies
 -7-




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Hazardous Materials.
 (a)
    
    Except for ordinary and general office supplies, such as copier toner, liquid paper, glue,
ink and common household cleaning materials (some or all of which may constitute Hazardous
Materials as defined in this Lease), Tenant agrees not to cause or permit any Hazardous
Materials to be brought upon, stored, used, handled, generated, released or disposed of on,
in, under or about the Premises, the Building, the Common Areas or any other portion of the
Project by Tenant, its agents, employees, subtenants, assignees, licensees, contractors or
invitees (collectively, Tenants Parties), without the prior written consent of Landlord,
which consent Landlord may withhold in its sole and absolute discretion. Concurrently with
the execution of this Lease, Tenant agrees to complete and deliver to Landlord an
Environmental Questionnaire in the form of Exhibit
G attached hereto. Upon the
expiration or earlier termination of this Lease, Tenant agrees to promptly remove from the
Premises, the Building and the Project, at its sole cost and expense, any and all Hazardous
Materials, including any equipment or systems containing Hazardous Materials which are
installed, brought upon, stored, used, generated or released upon, in, under or about the
Premises, the Building and/or the Project or any portion thereof by Tenant or any of Tenants
Parties. To the fullest extent permitted by law, Tenant agrees to
promptly indemnify,
protect, defend and hold harmless Landlord and Landlords partners, officers, directors,
employees, agents, successors and assigns (collectively, landlord indemnified Parties) from
and against any and all claims, damages, judgments, suits, causes or action, losses,
liabilities, penalties, fines, expenses and costs (including, without
limitation, clean-up,
removal, remediation and restoration costs, sums paw in settlement of claims, attorneys
fees, consultant fees and expert fees and court costs) which arise or result from the
presence of Hazardous Materials on, in, under or about the Premises, the Building or any
other portion of the Project and which are caused or permitted by Tenant or any of Tenants
Parties. Tenant agrees to promptly notify Landlord of any release of
Hazardous Materials in
the Premises, the Building or any other portion of the Project which Tenant becomes aware of
during the Term of this Lease, whether caused by Tenant or any other
persons or entities. In
the event of any release of Hazardous Materials caused or permitted by Tenant or any of
Tenants Parties, Landlord shall have the right, but not the obligation, to cause Tenant to
immediately take all steps Landlord deems necessary or appropriate to remediate such release
and prevent any similar future release to the satisfaction of
Landlord. At all times during
the Term of this Lease. Landlord will have the right, but not the obligation, to enter upon
the Premises to Inspect, Investigate, sample and/or monitor the Premises to determine if
Tenant is in compliance with the terms of this Lease regarding Hazardous Materials. As used
in this Lease, the term Hazardous Materials shall mean and include any hazardous or toxic
materials, substances or wastes as now or hereafter designated under any law, statute,
ordinance, rule, regulation, order or ruling of any agency of the State, the United States
Government or any local governmental authority, Including, without limitation, asbestos,
petroleum, petroleum hydrocarbons and petroleum based products, urea formaldehyde foam
Insulation, polychlorinated biphenyis (PCBs), and freon and
other chlorofluorocarborns. The provisions of
this Section 6.4 will survive the expiration or earlier termination of this Lease.(b)
    
    Landlord represents and warrants to Tenant that as of the date of this Lease and to
Landlords actual knowledge and except as disclosed in that certain Phase 1 dated December 18,
1996, prepared by Dames & Moore (i) there are no Hazardous Materials in, on, under, below or
otherwise located on or about the Premises in violation of applicable
law, and (ii) there has
been no release or migration of any Hazardous Materials in violation of applicable law onto,
beneath, upon or about the Premises.(c)
    
    Notwithstanding the foregoing, Landlord consents to the
storage and use at the Premises, and disposal from the
Premises, of certain Hazardous Materials upon the following conditions:
 (i)
    
    The Hazardous Materials are only those materials that are necessary from time to
time for the Initial Permitted Use described in Section 1.12 of the Summary;(ii)
    
    The storage, use and disposal of the Hazardous Materials complies with all
applicable laws, and Tenant provides to Landlord promptly following the preparation
thereof a copy of Tenants quarterly injury and illness prevention program inspection
(which inspection Tenant agrees to perform on at least a quarterly basis);(iii)
    
    The storage, use and disposal of the Hazardous Materials does not result in
objectionable odors or health hazards to other tenants or occupants of the Project;(iv)
    
    Tenant obtains and maintains all permits and approvals necessary for the
storage, use and disposal of the Hazardous Materials:(v)
    
    Tenant has not assigned this Lease to any third Party (other than to a Permitted
Transferee);
 -8-




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(vi)
    
    On the first day of each calendar year during the Term, Tenant shall deliver
to Landlord a disclosure statement containing the following:
 (1)
    
    A list containing all Hazardous
Materials and the quantities thereof stored, used or disposed from  the Premises during
the preceding calendar year;(2)
    
    A statement that (A) the use, storage and disposal of such
Hazardous Materials complies with all applicable laws,
(B) Tenant has all
necessary permits and approvals for the use, storage and disposal thereof, and
(C) Identifies the method of disposal of such Hazardous
Materials; and(3)
    
    Copies of all necessary permits and approvals relating to the
use, storage and disposal of such Hazardous Materials to the extent not
previously delivered to Landlord;
 (vii)
    
    Tenant shall immediately advise Landlord in writing of, and provide Landlord a copy
of:
 (1)
    
    Any notice of violation or potential or alleged violation of any
law concerning Hazardous Materials received by Tenant from any governmental
agency;(2)
    
    Any and all inquiry, Investigation, enforcement, clean-up, removal
or governmental or regulatory actions instituted or threatened relating to Tenant
or the Premises; and(3)
    
    All claims made or threatened by any third party against Tenant or
the Premises relating to any Hazardous Materials.
 (viii)
    
    The provisions of this subparagraph (c) shall not apply to the storage, use
and disposal of Hazardous Materials by a subtenant, unless thesubtenant is a
Permitted Transferee.
  Refuse and Sewage
 Pest Control
 Extraordinary Services
 7. Payments
and Notices
 8. Brokers
 -9-




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9.
Surrender; Holding Over.
 Surrender of Premises.
 Holding Over.
 No Effect on Landlords Rights.
 10. Taxes.
 Real Property Taxes. Real Property Taxes
    Personal Property Taxes.
 -10-




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Tenants Payment of Certain Tax Expenses. Reassessment)
 (a)
    
    The Tax Increase.For purposes of this Article 10, the term Tax Increaseshall mean that
portion of the Real Property Taxes, as calculated immediately following the Reassessment,
which is attributable solely to the Reassessment. Accordingly, the term Tax Increase shall
not include any portion of the Real Property Taxes, as calculated immediately following the
Reassessment, which (i) is attributable to the initial assessment of the value of the
Project, (ii) is attributable to assessments which were pending immediately prior to the
Reassessment which assessments were conducted during, and included in, such Reassessment, or
which assessments were
otherwise rendered unnecessary following the Reassessment, or (iii) is attributable to the
annual inflationary
increase of Real Property Taxes.(b)
    
    Protection.Tenant shall be obligated to pay Tenants pro rata share of the first Tax
Increase, but Tenant shall not be obligated to pay any portion of any subsequent Tax
Increase.(c)
    
    Landlords Right to Purchase the Proposition 13 Protection Amount Attributable to a
Particular Reassessment.The amount of Real Property Taxes which Tenant is not obligated to
pay or will not be obligated to pay during the Term in connection with a particular
Reassessment pursuant to the terms of Section 10.3 shall be sometimes referred to hereafter
as a Proposition 13 Protection Amount.If the occurrence of a Reassessment is reasonably
foreseeable by Landlord and the Proposition 13 Protection Amount attributable to such
Reassessment can be reasonably quantified or estimated for each year commencing with the
year in which the Reassessment will occur, the terms of this Section 10.3(c) shall apply to
each such Reassessment. Upon notice to Tenant, Landlord shall have the right to purchase the
Proposition 13 Protection Amount relating to the applicable Reassessment (the Applicable
Reassessment),at any time, by paying to Tenant an amount equal to the Proposition 13
Purchase Price,as that term is defined below. As used herein, Proposition 13 Purchase
Priceshall mean the present value of the Proposition 13 Protection Amount remaining during
the Term, as of the date of payment of the Proposition 13 Purchase Price by Landlord. Such
present value shall be calculated (I) by using the portion of the Proposition 13 Protection
Amount attributable to each remaining year during the Term that such protection is available
(as though the portion of such Proposition 13 Protection Amount benefited Tenant at the end
of each year), as the amounts to be discounted, and (ii) by using discount rates for each
amount to be discounted equal to (A) the prime interest rate, as reported in the Wall Street
Journal as of the date of Landlords exercise of its right to purchase plus (B) two percent
(2%) per annum. Upon such payment of the Proposition 13 Purchase Price, the provisions of
Section 10.3(b) shall not apply to any Tax Increase attributable to the Applicable
Reassessment. As Landlord will estimate the Proposition 13 Purchase Price because a
Reassessment has not yet occurred, then when such Reassessment occurs, if Landlord has
underestimated the Proposition 13 Purchase Price, then upon notice by Landlord to Tenant,
Tenants rent next due shall be credited with the amount of such underestimation, and if
Landlord overestimates the Proposition 13 Purchase Price, then upon notice by Landlord to
Tenant, rent next due shall be increased by the amount of the overestimation.
 11. Possession; Condition of Premises: Repairs .
 Delivery of Possession.
 Condition of Premises.
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Landlords Repair Obligations.
 Tenants Repair Obligations.
 12. Alterations .
 Tenant Changes; Conditions.
 (a)
    
    Tenant shall not make any alterations, additions, improvements or decorations to the
Premises (collectively, Tenant Changes, and
individually, a Tenant Change) unless Tenant
first obtains Landlords prior written approval thereof, which approval Landlord shall not
unreasonably withhold. Notwithstanding the foregoing, Landlords prior approval shall not be
required for any Tenant Change which satisfies all of the following conditions (hereinafter a
Pre-Approved Change): (i) the costs of such Tenant Change does not exceed Twenty-Five
Thousand Dollars ($25,000.00) Individually; (ii) the costs of such Tenant Change when
aggregated with the costs of all other Tenant Changes made by Tenant during the Term of this
Lease do not exceed One Hundred Thousand Dollars ($100,000.00); (iii) Tenant delivers to
Landlord final plans, specifications and working drawings for such Tenant Change at least ten
(10) days prior to commencement of the work thereof; (iv) the Tenant Change does not affect
the mechanical, electrical, plumbing or life safety systems of the Premises, the roof or
structural components of the Premises or the exterior of the Premises; and (v) Tenant and
such Tenant Change otherwise satisfy all other conditions set forth in this Section 12.1.(b)
    
    All Tenant Changes shall be performed: (i) in accordance with the approved plans,
specifications and working drawings; (ii) lien-free and in a good and workmanlike manner;
(iii) in compliance with all
laws, rules and regulations of all governmental agencies and authorities including, without
limitation, the provisions of Title III of
 -12-




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the Americans with Disabilities Act of 1990; (iv) in such a manner so as not to unreasonably
interfere with the occupancy of any other tenant in the Building or any other building
located within the Project, nor impose any additional expense upon nor delay Landlord in
the maintenance and operation of the Building or any other building located within the
Project; and (v) at such times, in such manner and subject to such rules and regulations as
Landlord may from time to time reasonably designate.(c)
    
    Throughout the performance of the Tenant Changes, Tenant shall obtain, or cause its
contractors to obtain, workers compensation insurance and commercial general liability
insurance in compliance with the provisions of Section 20 of this Lease.
 Removal of Tenant Changes and Tenant Improvements.
  Removal of Personal Property.
 Tenants Failure to Remove.
 13. Liens.
 14. Assignment and Subletting .
 Restriction on Transfer. Transfer
 -13-




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Permitted
Business.
 Permitted
Transfer Permitted Transferee,
 Transfer Notice. Transfer Date), Transfer Notice), Transferee),
 Landlords Options.
 Additional Conditions: 1 2
 15. Entry by Landlord.
 -14-




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16. Utilities and Services .
 17. Indemnification and Exculpation .
 Tenants Assumption of Risk and Waiver.
 Tenants Indemnification of Landlord. Landlord Indemnified
Parties Indemnified Claims Tenant Parties
 Landlords Indemnification of Tenant. Tenant Indemnified Parties
 Survival; No Release of Insurers.
 -15-




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18. Damage or Destruction .
 Landlords Rights and Obligations. and
 (a)
    
    promptly repair, reconstruct and restore the portion of the Premises damaged by such
casualty (including the Tenant Improvements but excluding Tenant Changes unless Tenant
delivers sufficient proceeds therefor), In which case this Lease shall continue in full force
and effect; or(b)
    
    terminate this Lease effective as of the date which is thirty (30) days after Tenants
receipt of Landlords election to so terminate.
    Tenants Costs and Insurance Proceeds.
 Abatement of Rent.
 Inability to Complete.
 -16-




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Damage to the Project.
 Damage Near End of Term.
  Waiver of Termination Right.
 19. Eminent Domain .
 Substantial Taking.
 Partial Taking; Abatement of Rent.
 Condemnation Award.
 Temporary Taking.
 -17-




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Waiver of Termination Right.
 20. Tenants Insurance .
 Types of Insurance.
 (a)
    
    All Risk insurance, including fire and extended coverage, sprinkler leakage, vandalism and
malicious mischief upon property of every description and kind owned by Tenant and located in
the Premises or the Building, or for which Tenant is legally liable or installed by or on
behalf of Tenant including, without limitation, furniture, equipment and any other personal
property, and any Tenant Changes (but excluding the initial Tenant Improvements previously
existing or installed in the Premises), in an amount not less then the full replacement cost
thereof.(b)
    
    Commercial general liability insurance coverage, including personal injury, bodily injury
(including wrongful death), broad form property damage, operations hazard, owners protective
coverage, contractual liability (including Tenants indemnification obligations under this
Lease, including Section 17 hereof), liquor liability (if Tenant serves alcohol on the
Premises), and owned/non-owned auto liability,
with a general aggregate of not less than Two Million Dollars
($2,000,000.00), The general aggregate amount of such commercial general liability insurance shall be increased
every five (5) years during the, Term of this Lease to an amount reasonably required by
Landlord and prudent industry practice.(c)
    
    Workers compensation and employers liability insurance, in statutory amounts and limits.(d)
    
    Loss of income, extra expense and business interruption insurance in such amounts as will
reimburse Tenant for direct or indirect loss of earnings attributable to all perils commonly
insured against by prudent tenants or attributable to prevention of access to the Premises,
Tenants parking areas or to the Building as a result of such perils. Tenant may elect to
self-insure this risk.(e)
    
    Any other form or forms of insurance as Tenant or Landlord or the mortgagees of Landlord may
reasonably require from time to time, in form, amounts and for insurance risks against which
a prudent tenant would protect itself, but only to the extent such risks and amounts are
available in the insurance market at commercially reasonable costs.
 Requirements.
 Effect on Insurance.
 -18-




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21. Landlords Insurance . Exhibit C
 22. Waivers of Subrogation .
 Mutual Waiver of Parties.
 Waiver of Insurers.
 23. Tenants Default and Landlords Remedies .
 Tenants Default.
 (a)
    
    the abandonment of the Premises by Tenant. Abandonment is herein defined to include, but is
not limited to, any absence by Tenant from the Premises for fourteen (14) business days or longer
while in default of any monetary provision of this Lease;(b)
    
    the failure by Tenant to make any payment of rent or additional rent or any other payment
required to be made by Tenant hereunder, within seven (7) days of when due;(c)
    
    the failure by Tenant to observe or perform any of the express or implied covenants or
provisions of this Lease to be observed or performed by Tenant, other than as specified in
Sections 23.1(a) or (b) above, where such failure shall continue for a period of thirty (30) days
after written notice thereof from Landlord to Tenant; however, that any such notice shall be in
lieu of, and not in addition to, any notice required under California Code of Civil Procedure,
Section 1161 and provided further that, if the nature of Tenants default is such that more than
thirty (30) days are reasonably required for its cure, then Tenant shall not be deemed to be in
default if Tenant shall commence such cure within said thirty (30) day period and thereafter
diligently prosecute such cure to completion; and(d)
    
    (i) the making by Tenant of any general assignment for the benefit of creditors, (ii) the
filing by or against Tenant of a petition to have Tenant adjudged a bankrupt or a petition for
reorganization or arrangement under any law relating to bankruptcy (unless, in the case of a
petition filed against the Tenant, the same is dismissed within sixty (60) days), (iii) the
appointment of a trustee or receiver to take possession of substantially all of Tenants assets
located at the Premises or of Tenants interest in this Lease, where possession is not restored to
Tenant within sixty (60) days, or (iv) the attachment, execution or other judicial seizure of
substantially all of Tenants assets located at the Premises or of Tenants interest in this Lease
where such seizure is not discharged within sixty (60) days.
 Landlords Remedies; Termination.
 (a)
    
    the worth at the time of award of any unpaid rent which had been earned at the time of
such termination; plus
 -19-




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(b)
    
    the worth at the time of the award of the amount by which the unpaid rent which would have
been earned after termination until the time of award exceeds the amount of such rental loss that
Tenant proves could have been reasonably avoided; plus(c)
    
    the worth at the time of award of the amount by which the unpaid rent for the balance of the
term after the time of award exceeds the amount of such rental loss that Tenant proves could be
reasonably avoided; plus(d)
    
    any other amount necessary to compensate Landlord for all 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 including, but not limited to: unamortized Tenant
Improvement costs; attorneys fees; unamortized brokers commissions; the costs of refurbishment,
renovation and repair of the Premises; and removal (including the repair of any damage caused by
such removal) and storage (or disposal) of Tenants personal property, equipment, fixtures, Tenant
Changes, Tenant Improvements and any other Items which Tenant is required under this Lease to
remove but does not remove.
  Landlords Remedies; Re-Entry Rights.
 Landlords Remedies; Continuation of Lease.
 Landlords Right to Perform.
 Interest.
 Late Charges.
 [Intentionally Omitted].
 -20-




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Rights and Remedies Cumulative.
 24. Landlords Default .
 25. Subordination .
  Nondisturbance
Condition
 26. Estoppel Certificate .
 Obligations. Exhibit F Exhibit F
 Failure to Deliver.
 27. Intentionally Omitted.
 -21-




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28. Modification and Cure Rights of Landlords Mortgagees and Lessors.
 Modifications.
 Cure Rights.
 29. Quiet Enjoyment .
 30. Transfer of Landlords Interest .
 31. Limitation on Landlords Liability .
 32. Miscellaneous .
 Governing Law.
 Successors and Assigns.
 No Merger.
 Professional Fees.
 Waiver.
 -22-




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Terms and Headings.
 Time.
 Prior Agreements; Amendments.
 Separability.
 Recording.
 Exhibits and Riders.
 Auctions.
 Accord and Satisfaction.
 Financial Statements.
 No Partnership.
 Force Majeure. Force Majeure Delays
 Counterparts.
 Nondisclosure of Lease Terms.
 -23-




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Non-Discrimination.
 33. Lease Execution .
 Tenants Authority.
 Joint and Several Liability.
 Landlords Authority.
 No Option.
 34. [Intentionally Omitted] .
 .
 TENANT
    AURORA BIOSCIENCES CORPORATION,
a Delaware corporationBy:

/s/
Timothy J. RinkName:
    Timothy J. RinkTitle:
    CEO PresidentBy:

/s/
Deborah J. TowerName:
    Deborah J. TowerTitle:
    Sr. Director, Finance and AdministrationLANDLORD
    AEW/LBA ACQUISITION CO. II, LLC,
a California limited liability companyBy:
    LBA, Inc., a California corporation, its agentBy:

/s/
Phil A. BellingName:
    Phil A. BellingTitle:By:Name:Title: -24-