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                                                                  EXHIBIT 10.5.4

                           EXCLUSIVE LICENSE AGREEMENT

                                     Between

                    President and Fellows of Harvard College

                                       And

                                  NanoSys, Inc

                             Re: Harvard Case [*** Redacted]

         In consideration of the mutual promises and covenants set forth below,
         the parties hereto agree as follows:

                                    ARTICLE I
                                   DEFINITIONS

         As used in this Agreement, the following terms shall have the following
         meanings:

1.1      ACADEMIC RESEARCH PURPOSES: use of PATENT RIGHTS solely for academic
         non-commercial research or other not-for-profit scholarly purposes,
         which use is undertaken at a non-profit or governmental institution.
         ACADEMIC RESEARCH PURPOSES does not include selling products covered by
         PATENT RIGHTS or using PATENT RIGHTS in researching, developing,
         producing or manufacturing products for sale, or performance of
         services for a fee or other financial consideration. It is understood
         that using the PATENT RIGHTS to conduct normal research activities at
         non-profit or governmental institution is within the defined term of
         ACADEMIC RESEARCH PURPOSES.

1.2      AFFILIATE: any entity which controls, is controlled by, or is under
         common control with a party. An entity shall be regarded as in control
         of another entity for purposes of this definition if it owns or
         controls at least fifty percent (50%) of the shares entitled to vote in
         the election of directors (or in the case of an entity that is not a
         corporation, for the election of the corresponding managing authority).
         Unless otherwise specified, the term LICENSEE includes AFFILIATES.

1.3      FIELD: All fields of use.

1.4      HARVARD: President and Fellows of Harvard College, a nonprofit
         Massachusetts educational corporation having offices at the Office for
         Technology and Trademark

*** Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Commission.
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         Licensing, Holyoke Center, Suite 727, 1350 Massachusetts Avenue,
         Cambridge, Massachusetts 02138.

1.5      LICENSED PROCESSES: methods, processes or procedures covered by at
         least one VALID CLAIM included within the PATENT RIGHTS.

1.6      LICENSED PRODUCTS: products covered by at least one VALID CLAIM
         included within the PATENT RIGHTS or products made in accordance with
         LICENSED PROCESSES.

1.7      LICENSEE: Nanosys, Inc., a corporation organized under the laws of
         Delaware having its principal offices at 2625 Hanover Street, Palo
         Alto, CA 94304

1.8      NET SALES: [*** Redacted]

*** Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Commission.

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         [*** Redacted]

1.9      PATENT RIGHTS: PATENT RIGHTS shall include (i) the applications and
         patents as listed in Appendix A of this Agreement, (ii) any foreign
         counterparts to such patents and patent applications, (iii) the
         inventions described and claimed in the foregoing, (iv) any divisions-
         or continuations of the foregoing, (v) applications from which the
         patents and applications listed in Appendix A claim priority, and which
         have been abandoned, and (vi) specific claims of any
         continuations-in-part of the foregoing to the extent the specific
         claims are directed to subject matter described in the foregoing in a
         manner sufficient to support such specific claims under 35 U.S.C. and
         to the extent Licensable by HARVARD; claims in said
         continuations-in-part covering minor improvements over the claims of
         parent patent applications may, at HARVARD'S discretion, be included in
         PATENT RIGHTS by amendment of this Agreement for no increase in the
         royalties of Article IV, (vi) all patents issuing on any of the
         foregoing, and (vii) registrations, renewals, reissues, reexaminations,
         extensions or patents of addition of any kind with respect to any of
         such patents. For purposes of this Agreement "Licensable" shall mean
         those claims of continuations-in-part filed after the Effective Date
         for which HARVARD has sole ownership (or has been granted the sole
         right to license by a co-owner) and where there are no obligations to
         grant licenses to a third party as the result of research support
         provided to one or more of the inventors.

1.10     SERVICE INCOME: [*** Redacted]

*** Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Commission.

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         [*** Redacted]

1.11     SUBLICENSE INCOME: [*** Redacted]

1.12     TERRITORY: Worldwide.

1.13     VALID CLAIM: either (i) a claim of an issued patent that has not
         expired or been held unenforceable or invalid by an agency or a court
         of competent jurisdiction, and which has not been admitted to be
         invalid or unenforceable through reissue, disclaimer or otherwise;
         provided, however, that if the holding of such court or agency is later
         reversed by a court or agency with overriding authority, the claim
         shall be reinstated as a Valid Claim with respect to Net Sales made
         after the date of such reversal, or (ii) a claim of a pending patent

*** Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Commission.

                                                                               4

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         application that has not been abandoned or finally rejected without the
         possibility of appeal or re-filing and that has been pending for less
         than seven (7) years from its priority date, and is being actively
         prosecuted in good faith.

1.14     The terms "Public Law 96-517" and "Public Law 98-620" include all
         amendments to those statutes.

1.15     The terms "sold" and "sell" include, without limitation, leases and
         other dispositions and similar transactions.

1.16     RELATED LICENSE AGREEMENTS: Other patent license agreements between
         LICENSEE and HARVARD licensing patent rights known internally at
         HARVARD as Case [*** Redacted].

1.17     DEVELOPMENT PAYMENTS: [*** Redacted].

                                   ARTICLE II
                                    RECITALS

2.1      HARVARD is owner (or HARVARD will be owner) by assignment from
         [*** Redacted] of HARVARD [*** Redacted] of their entire right, title
         and interest in the United States Patent Application Serial Number
         [*** Redacted], filed [*** Redacted], and [*** Redacted] filed
         [*** Redacted], and corresponding International Patent Application
         Serial No. [*** Redacted], filed [*** Redacted], all entitled
         [*** Redacted], and the foreign patent applications corresponding
         thereto, and in the inventions described and claimed therein.
         [*** Redacted] was an owner by assignment from [*** Redacted], and has
         assigned its interest to HARVARD, a copy of said assignment is attached
         in Appendix C.

2.2      HARVARD has the authority to issue licenses under PATENT RIGHTS.

2.3      HARVARD is committed to the policy that ideas or creative works
         produced at HARVARD should be used for the greatest possible public
         benefit, and believes that every reasonable incentive should be
         provided for the prompt introduction of such ideas into public use, all
         in a manner consistent with the public interest.

2.4      LICENSEE intends to use commercially reasonable efforts to develop the
         invention(s), and to bring to market at least one product falling
         within the definition of LICENSED PRODUCT or otherwise embodying the
         subject matter described or claimed in the patent rights licensed under
         such agreements.

*** Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Commission.

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2.5      LICENSEE is desirous of obtaining an exclusive license in the TERRITORY
         in order to practice the above-referenced invention covered by PATENT
         RIGHTS in the United States and in certain foreign countries, and to
         manufacture, use and sell in the commercial market the products made in
         accordance therewith, and HARVARD is desirous of granting such a
         license to LICENSEE in accordance with the terms of this Agreement.

                                   ARTICLE III
                                 GRANT OF RIGHTS

3.1      HARVARD hereby grants to LICENSEE and LICENSEE accepts, subject to the
         terms and conditions hereof, an exclusive license (except as set forth
         in Sections 3.2(a) and 3.2(b)) under PATENT RIGHTS in the TERRITORY and
         in the FIELD (i) to make and have made, to use and have used, to sell
         and have sold, to offer for sale, import, export, or otherwise
         distribute the LICENSED PRODUCTS, (ii) to practice the LICENSED
         PROCESSES, and (iii) to otherwise fully exploit the PATENT RIGHTS, and
         (iv) to have the foregoing performed on behalf of LICENSEE by a third
         party, in each case for the life of the PATENT RIGHTS. The foregoing
         license under PATENT RIGHTS shall include the full right to grant
         sublicenses, and LICENSEE shall promptly provide copies of any
         sublicenses of PATENT RIGHTS to HARVARD for its review. Unless HARVARD
         has rendered the license under PATENT RIGHTS non-exclusive under
         Section 3.2(c), and with the exception of rights already granted to
         Nantero, Inc., under HARVARD Case # [*** Redacted], as provided in
         Section 3.2(b)(ii), below, HARVARD agrees that it will not grant
         licenses under PATENT RIGHTS to others nor make, use, sell, offer for
         sale, import or otherwise exploit PATENT RIGHTS itself except as
         required by HARVARD'S obligations in Section 3.2(a) or as permitted in
         Sections 3.2(b)(i) and 3.2(f).

3.2      The granting and exercise of this license is subject to the following
         conditions:

         (a)      HARVARD'S "Statement of Policy in Regard to Inventions,
                  Patents and Copyrights," dated August 10, 1998, Public Law
                  96-517 and Public Law 98-620, and HARVARD'S obligations under
                  prior or current agreements with other sponsors of research
                  and, with regard to continuations-in-part contained in the
                  PATENT RIGHTS, any future agreements with other sponsors of
                  research related to such continuations-in-part. Any right
                  granted in this Agreement greater than that permitted under
                  Public Law 96-517, or Public Law 98-620, shall be subject to
                  modification to the extent required to conform to the
                  provisions of those statutes.

         (b)      (i) HARVARD reserves the right to make and use, and grant to
                  other non-profit or governmental institutions non-exclusive
                  licenses to make and use, in each case solely for ACADEMIC
                  RESEARCH PURPOSES the subject matter described and claimed in
                  PATENT RIGHTS. HARVARD shall promptly notify LICENSEE of any
                  rights granted to any third party (other than the U.S.
                  government) under Sections 3.2(a) and (b).

         (c)      (ii) LICENSEE expressly recognizes that Nantero, Inc.
                  ("NANTERO") currently has a limited license under PATENT
                  RIGHTS, to the extent PATENT RIGHTS are included in NANTERO'S
                  co-exclusive license under the patent rights comprising

*** Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Commission.

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                 HARVARD case [*** Redacted] (but not to practice any technology
                 of PATENT RIGHTS that is not within the technology of HARVARD
                 case [*** Redacted]).

         (d)     LICENSEE shall use commercially reasonable efforts to effect
                 introduction into the commercial market at least [*** Redacted]
                 falling within the definition of LICENSED PRODUCT or otherwise
                 embodying the subject matter described or claimed in PATENT
                 RIGHTS within [*** Redacted] years of the effective date of
                 this Agreement; thereafter, until the expiration of this
                 Agreement, LICENSEE shall use commercially reasonable efforts
                 to endeavor to keep any [*** Redacted] reasonably available to
                 the public so long as it shall be a sound and reasonable
                 commercial practice to do so.

                 At any time after [*** Redacted] years from the effective date
                 of this Agreement, HARVARD may render this license
                 non-exclusive if LICENSEE has not, either by itself or through
                 a sublicensee:

                   (i)    introduced into commercial use at least [*** Redacted]
                          falling within the definition of LICENSED PRODUCT or
                          made by a LICENSED PROCESS; and

                   (ii)   used commercially reasonable efforts to put the
                          licensed subject matter into commercial use as broadly
                          as commercially reasonable in one or more of the
                          countries hereby licensed, directly or through a
                          sublicense, as described in LICENSEE'S development
                          plan required by Paragraph 5.1 (b);and

                   (iii)  used commercially reasonable efforts to keep products
                          falling within the definition of LICENSED PRODUCT or
                          otherwise embodying the subject matter described or
                          claimed in PATENT RIGHTS reasonably available to the
                          public so long as it shall be a sound and reasonable
                          commercial practice to do so; and

                   (iv)   engaged in research, development, manufacturing,
                          marketing or sublicensing activity that is
                          commercially reasonably appropriate to achieving
                          Section 3.2(d)(ii) or 3.2(d)(iii).

         (e)     In all sublicenses granted by LICENSEE hereunder, LICENSEE
                 shall include a requirement that the sublicensee use
                 commercially reasonable efforts to put the subject matter of
                 the sublicense into commercial use, provided that such
                 sublicensee is authorized to develop and sell to the public a
                 [*** Redacted] covered by PATENT RIGHTS on its own behalf.
                 LICENSEE shall further provide that such sublicenses are
                 subject and subordinate to the terms and conditions of this
                 Agreement, except for the [*** Redacted] paid by such
                 sublicensee to the LICENSEE. Copies of all sublicense
                 agreements hereunder shall be provided promptly to HARVARD.
                 Such copies of sublicense agreements may be provided to HARVARD
                 in redacted form, provided that such copies contain all
                 relevant terms necessary for HARVARD to monitor LICENSEE'S
                 compliance with the terms of this Agreement.

*** Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Commission.

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                  Unredacted copies of said sublicense agreements shall be made
                  available for review by HARVARD or its representatives at
                  LICENSEE'S Medford, MA facility, or whichever facility is
                  closest to HARVARD, within one week, of HARVARD'S request. All
                  sublicense agreements of LICENSEE provided to HARVARD shall be
                  deemed Confidential Information of LICENSEE subject to Section
                  11.1.

         (f)      At any time [*** Redacted] years after the effective date
                  of this Agreement, if LICENSEE is unable or unwilling to
                  grant sublicenses, either [*** Redacted] by HARVARD or
                  [*** Redacted] or otherwise, then HARVARD may directly license
                  such [*** Redacted], but only if: (i) LICENSEE is not
                  currently pursuing development of LICENSED PRODUCTS for the
                  same application, or an application that is reasonably
                  competitive with the application as contemplated by the
                  potential sublicensee, as demonstrated by annual progress
                  reports from LICENSEE required by Paragraph 5.2, or the
                  research and development plan required by Paragraph 5.1(b) of
                  this agreement or within a [*** Redacted] LICENSEE makes a
                  commitment to do so , said commitment being satisfied by a
                  written research and development plan, acceptable to HARVARD
                  and said acceptance given within the [*** Redacted], said
                  acceptance not to be unreasonably denied. (if, in subsequent
                  reports by LICENSEE to HARVARD as required under Section 5.2,
                  LICENSEE fails to develop any applications according to the
                  research and development plan, as potentially amended
                  according to Section 5.2, such applications become subject to
                  this Paragraph); (ii) the granting of such a license by
                  HARVARD to the potential sublicensee will increase the
                  availability of useful products to the public, and (iii)
                  HARVARD notifies LICENSEE of its intention to grant such
                  license and permits LICENSEE a [*** Redacted] period to
                  negotiate a sublicense on its own, said [*** Redacted] period,
                  unless otherwise agreed to by the Parties, shall be no less
                  than [*** Redacted], nor greater than [*** Redacted].

         (g)      To the extent required by law, until this license is rendered
                  non-exclusive in the United States under Section 3.2 (d),
                  LICENSEE shall cause any LICENSED PRODUCT produced for sale in
                  the United States to be manufactured substantially in the
                  United States.

         (h)      HARVARD recognizes that LICENSEE'S success in meeting the
                  obligations set forth in this paragraph may be enhanced by
                  consultation with the inventor(s) of the PATENT RIGHTS.
                  Accordingly, Harvard will use reasonable efforts to make such
                  inventors reasonably available to LICENSEE for such
                  consultation.

3.3      All rights reserved to the United States Government and others under
         Public Law 96-517, and Public Law 98-620, shall remain and shall in no
         way be affected by this Agreement.

3.4      HARVARD shall promptly notify LICENSEE when any new patent or patent
         application arises from (i) research conducted in the laboratory of
         [*** Redacted], or (ii) improvements made by HARVARD [*** Redacted] on
         the subject matter described in PATENT RIGHTS. If LICENSEE so requests
         and the intellectual property is available for licensing, HARVARD will
         evaluate in good faith LICENSEE'S proposal along with proposals
         received from any third parties. Any decision to grant a license to
         LICENSEE shall be subject to approval by HARVARD'S Committee

*** Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Commission.

                                                                               8

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         on Patents and Copyrights. In the event LICENSEE and HARVARD cannot
         agree on terms for a license to any new intellectual property which is
         dominated by PATENT RIGHTS, HARVARD shall not offer any third party
         terms more favorable, in toto, than the terms offered to LICENSEE.

                                   ARTICLE IV
                                    ROYALTIES

4.1      LICENSEE shall owe to HARVARD a non-refundable license royalty fee in
         the sum of [*** Redacted] ($*** Redacted) dollars upon execution of
         this Agreement, which shall be payable within [*** Redacted] days of
         this Agreement becoming effective.

4.2      As consideration for the rights granted hereunder, LICENSEE shall pay
         to HARVARD a non-refundable fee in the form of stock of LICENSEE as
         follows:

                    (i)    LICENSEE shall issue to HARVARD and HARVARD shall
                           purchase ten thousand (10,000) fully vested shares,
                           at a price per share of $0.19 per share and an
                           aggregate value of $1,900.00 of LICENSEE'S common
                           stock upon execution of this Agreement, provided,
                           however, that HARVARD shall be subject to and enter
                           into (1) appropriate agreements and related documents
                           as required of other stockholders of LICENSEE,
                           including without limitation a Common Stock Purchase
                           Agreement, and (2) a Voting Agreement by and among
                           the LICENSEE, HARVARD and certain other holders of
                           common stock of LICENSEE dated as of even date
                           hereof.

                    (ii)   HARVARD'S ownership rights to Shares shall not be
                           affected should the license pursuant to this
                           Agreement be terminated by LICENSEE or HARVARD.

4.3      (a) LICENSEE shall pay to HARVARD during the term of this Agreement a
         royalty on NET SALES by LICENSEE according to the following schedule:

           (i)    [*** Redacted]% of NET SALES by LICENSEE in [*** Redacted]
                  applications;

           (ii)   [*** Redacted]% of NET SALES by LICENSEE in [*** Redacted]
                  applications; or

           (iii)  [*** Redacted]% of NET SALES by LICENSEE in [*** Redacted]
                  excluding [*** Redacted] applications and [*** Redacted]
                  applications.

         In the event, any NET SALES by LICENSEE reasonably falls within more
         than one of categories (i) to (iii) above, LICENSEE shall pay to
         HARVARD the lowest applicable royalty set forth in such categories.

*** Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Commission.

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         (b)      For each LICENSED PRODUCT sold by LICENSEE, LICENSEE may
                  credit up to [*** Redacted] of royalties that LICENSEE is
                  paying to third parties (or HARVARD under agreements not
                  included within section 4.3(c)) on LICENSEE'S sales of that
                  LICENSED PRODUCT, provided that the royalty paid to HARVARD
                  shall not be reduced below [*** Redacted] percent ([***
                  Redacted]%) of the NET SALES of that LICENSED PRODUCT for
                  which such third party royalties are being paid. LICENSEE may
                  only offset royalties owed under license agreements to third
                  parties where said license agreements provide for similar
                  offsets of comparable scale of third party royalties. Any such
                  offsets must be specifically and thoroughly reported in the
                  royalty reports required by Paragraph 5.4.

         (c)      In the event that sales of a LICENSED PRODUCT are subject to
                  the payment of royalties under one or more of the RELATED
                  LICENSE AGREEMENTS or any license agreements with HARVARD with
                  the same effective date as this Agreement, then the total
                  royalty payment due HARVARD under all such agreements
                  including this Agreement shall be at most the royalty payment
                  due under this Section 4.3 on such NET SALE, no matter how
                  many license agreements from HARVARD are involved, and
                  notwithstanding the terms of any such agreement. LICENSEE
                  shall notify HARVARD of the identity of each license agreement
                  that includes patent rights covering the product or process,
                  and HARVARD shall distribute the royalties evenly among such
                  agreements, including this Agreement.

         (d)      LICENSEE shall pay HARVARD [*** Redacted] percent ([***
                  Redacted]%) of SUBLICENSE INCOME received by LICENSEE for a
                  sublicense of PATENT RIGHTS. If compensation for such a
                  sublicense of PATENT RIGHTS is bundled with compensation
                  received for the sublicensing of the other HARVARD patents
                  rights or other HARVARD intellectual property licensed to
                  LICENSEE under the RELATED LICENSE AGREEMENTS or any
                  agreements with HARVARD having the same effective date as this
                  Agreement, then LICENSEE shall pay HARVARD at most the royalty
                  payment due under this Section 4.3(d) for such SUBLICENSE
                  INCOME no matter how many license agreements from HARVARD are
                  involved, and notwithstanding the terms of any such license
                  agreements. In such a case, LICENSEE shall notify HARVARD of
                  the identity of each license agreement involved and HARVARD
                  shall distribute the royalties equally among those license
                  agreements, including this Agreement.

         (e)      For provision of services under PATENT RIGHTS, LICENSEE shall
                  pay a royalty of [*** Redacted] percent ([*** Redacted]%) of
                  SERVICE INCOME received by LICENSEE from each and every third
                  party ("Third Party") to whom LICENSEE provides such services.
                  In the event any services from which SERVICE INCOME is derived
                  are subject to the payment of royalties under the RELATED
                  LICENSE AGREEMENTS or any agreement with HARVARD having the
                  same effective date as this Agreement, then the total royalty
                  due under all such agreements, including this Agreement, shall
                  be at most the royalty payment due under this Section 4.3 on
                  such services, no matter how many license agreements from
                  HARVARD are involved, and notwithstanding the terms of any
                  such license agreements. In such event, LICENSEE shall notify
                  HARVARD of the identity of each license agreement involved and
                  HARVARD shall distribute the royalties equally among those
                  license agreements, including this Agreement.

*** Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Commission.

                                                                              10

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         (f)      If the license pursuant to this Agreement is converted to a
                  non-exclusive one under Section 3.2(d) and if another
                  non-exclusive license to any of PATENT RIGHTS is granted or
                  otherwise exists for any field or territory, then the royalty
                  rate of this Agreement shall be adjusted so as not to exceed
                  the royalty rate payable by such other non-exclusive licensee
                  under such PATENT RIGHTS in such field or territory, provided
                  that LICENSEE agrees to amend this Agreement to include terms
                  requested by HARVARD that have been accepted by such other
                  non-exclusive licensee.

         (g)      On sales between LICENSEE and its AFFILIATES for resale, the
                  royalty shall be paid on the NET SALES of the AFFILIATE.

         (h)      In the event that more than one VALID CLAIM within PATENT
                  RIGHTS is applicable to any LICENSED PRODUCT subject to
                  royalties under this Section 4.3, then only one royalty shall
                  be paid to HARVARD in respect of such LICENSED PRODUCT. In no
                  event shall more than one royalty be due to HARVARD with
                  respect to any LICENSED PRODUCT unit; nor shall a royalty be
                  payable under this Section 4.3 with respect to sales of
                  LICENSED PRODUCTS for clinical trials nor the use of LICENSED
                  PRODUCTS or LICENSED PROCESSES by LICENSEE for such a purpose
                  whether or not in collaboration with a third party.

         4.4      No later than January 1 of each calendar year after the
                  effective date of this Agreement, LICENSEE shall pay to
                  HARVARD the following non-refundable license maintenance
                  royalty and/or advance on royalties. Such payments may be
                  credited against running royalties due for that calendar year
                  and Royalty Reports shall reflect such a credit. Such payments
                  shall not be credited against milestone payments (if any) nor
                  against royalties due for any subsequent calendar year.

<TABLE>
<S>                           <C>
January 1, 2004               [*** Redacted]
January 1, 2005               [*** Redacted]
January 1, 2006               [*** Redacted]
January 1, 2007               [*** Redacted]
January 1, 2008               [*** Redacted]
January 1, 2009               [*** Redacted]
January 1, 2010               [*** Redacted]
each January 1 thereafter     [*** Redacted]
</TABLE>

                                    ARTICLE V
                                    REPORTING

5.1      a) In compliance of earlier RELATED LICENSE AGREEMENTS, LICENSEE has
         provided to HARVARD a written research and development plan acceptable
         to LICENSEE'S investors under which LICENSEE intends to bring the
         subject matter of the

*** Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Commission.

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         earlier RELATED LICENSE AGREEMENTS (though not specifically of this
         Agreement) granted earlier into commercial use. Such plan included
         projections of sales and proposed marketing efforts.

         b) LICENSEE agrees to provide, no later than [*** Redacted] years after
         the effective date of this Agreement, a written research and
         development plan, under which LICENSEE intends to bring the subject
         matter of PATENT RIGHTS into commercial use. Such research and
         development plan shall be subject to the written approval or
         disapproval of HARVARD, which written approval shall not be
         unreasonably withheld. Failure to provide written disapproval within
         [*** Redacted] days of receipt of such research and development plan
         shall constitute HARVARD'S approval in accordance with this section.
         Such a plan shall include a description of each LICENSED PRODUCT to be
         developed, a developmental timeline showing the technical, regulatory,
         business and marketing steps (benchmarks) needed to bring the LICENSED
         PRODUCT into commercial use and the resources in funds and personnel
         that LICENSEE will bring to bear for the successful accomplishment of
         each such step, and shall include projected sales and a proposed
         marketing effort

5.2      No later than [*** Redacted] days after [*** Redacted] of each
         [*** Redacted], LICENSEE shall provide to HARVARD a written annual
         Progress Report describing progress on the commercialization of PATENT
         RIGHTS during the most recent [*** Redacted] period ending
         [*** Redacted], the amount of LICENSEE'S R&D spending relating to the
         subject matter described or claimed in PATENT RIGHTS during such time,
         and plans for the forthcoming year. If multiple technologies are
         covered by the license granted hereunder, the Progress Report shall
         provide the information set forth above for each technology. If
         progress differs from that anticipated in the plan required under
         Section 5.1(b), LICENSEE shall explain the reasons for the difference
         and, if appropriate or necessary, provide a modified research and
         development plan for HARVARD'S review and approval, such approval not
         to be unreasonably denied. It is understood that LICENSEE may provide
         one Progress Report covering all RELATED LICENSE AGREEMENTS.

5.3      LICENSEE shall report to HARVARD the date of its first NET SALE of a
         LICENSED PRODUCT (or the date of its first use of a LICENSED PROCESS
         from which SERVICE INCOME is derived) in each country within
         [*** Redacted] days of occurrence. It is understood that LICENSEE shall
         be obligated to report the date of first sale of LICENSED PRODUCTS (or
         the first commercial use of LICENSED PROCESSES) under this Section 5.3
         only once for each country.

5.4      (a) LICENSEE shall submit to HARVARD within [*** Redacted] days after
         each calendar [*** Redacted] ending [*** Redacted], a Royalty Report
         setting forth, for the most recent [*** Redacted] that ended on
         [*** Redacted], at least the following information:

                  (i)      the number and identification of LICENSED PRODUCTS
                           sold by LICENSEE and its AFFILIATES that constitute a
                           NET SALE, in each country;

*** Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Commission.

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                  (ii)     total amounts received for such LICENSED PRODUCTS
                           sold by LICENSEE and its AFFILIATES;

                  (iii)    an accounting for all LICENSED PROCESSES used or sold
                           by LICENSEE and its AFFILIATES;

                  (iv)     deductions applicable to determine the NET SALES
                           thereof;

                  (v)      the amount of SUBLICENSE INCOME received by LICENSEE
                           from each sublicensee, and for each sublicensee the
                           categories of LICENSED PRODUCTS sold and gross sales
                           of each category;

                  (vi)     the amount of SERVICE INCOME received by LICENSEE;
                           and

                  (vii)    the amount of royalty due for such reporting period,
                           or, if no royalties are due to HARVARD for such
                           reporting period, the statement that no royalties are
                           due.

                  Such report shall be certified as correct by an officer of
                  LICENSEE and shall include a listing of all deductions from
                  royalties. It is understood that LICENSEE may submit one
                  Royalty Report covering all RELATED LICENSE AGREEMENTS.
                  However, the Royalty Report shall, for each type of income,
                  provide a detailed listing of the RELATED LICENSE AGREEMENTS
                  that are involved.

         (b)      LICENSEE shall pay to HARVARD with each such Royalty Report
                  the amount of royalty due with respect to such [*** Redacted].
                  If multiple technologies are covered by the license granted
                  hereunder, LICENSEE shall specify which PATENT RIGHTS are
                  utilized for each category of LICENSED PRODUCTS and/or
                  LICENSED PROCESSES for which royalties are separately reported
                  in the Royalty Report.

         (c)      All payments due hereunder shall be deemed received when funds
                  are credited to HARVARD'S bank account and shall be payable by
                  check or wire transfer in United States dollars. Conversion of
                  foreign currency to U.S. dollars shall be made at the
                  conversion rate existing in the United States (as reported in
                  the New York Times or the Wall Street Journal) on the last
                  working day of each royalty period. No transfer, exchange,
                  collection or other charges shall be deducted from such
                  payments. If legal restrictions block the removal of local
                  currency from any country where a LICENSED PRODUCT is sold,
                  the royalties payable under this Agreement on NET SALES,
                  SERVICE INCOME and SUBLICENSING INCOME earned in such currency
                  in such country shall continue to be reported and accrued,
                  but will not be paid until such currency may be removed from
                  such country.

         (d)      All plans or reports received under Sections 5.1, 5.2, 5.3,
                  5.4 shall be deemed Confidential Information of LICENSEE
                  subject to Section 11.1; provided, however, that HARVARD may
                  disclose such information as required by law under Section
                  1l.l(b), and may include in its usual reports the annual
                  amounts of royalties paid.

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         (e)      Late payments shall be subject to a charge of [*** Redacted]
                  percent ([*** Redacted]%) per month, or $[*** Redacted],
                  whichever is greater.

5.5      In the event of acquisition, merger, change of corporate name, or
         change of make-up, organization, or identity, LICENSEE shall notify
         HARVARD in writing within [*** Redacted] days of such event.

5.6      If LICENSEE or any of its sublicensees does not qualify as a "small
         entity" as provided by the United States Patent and Trademark Office,
         LICENSEE must notify HARVARD immediately.

                                   ARTICLE VI
                                 RECORD KEEPING

6.1      LICENSEE shall keep accurate records (together with supporting
         documentation) of LICENSED PRODUCTS made, used or sold under this
         Agreement, sufficient to determine the amount of royalties due to
         HARVARD hereunder. Such records shall be retained for at least
         [*** Redacted] years following the end of the reporting period to which
         they relate. They shall be available during normal business hours for
         examination, upon HARVARD'S reasonable request, not more than once in
         any [*** Redacted] month period and upon at least [*** Redacted] days
         prior notice, by an independent accountant under a duty of
         confidentiality, selected by HARVARD and reasonably acceptable to
         LICENSEE, for the sole purpose of verifying reports and payments under
         Section 5.4. In conducting examinations pursuant to this Section,
         HARVARD'S accountant shall have access to records materially relevant
         to the calculation of royalties under Article IV.

6.2      HARVARD'S accountant shall only disclose to HARVARD whether the reports
         and payments of royalties hereunder are accurate, and the amount of the
         underreporting or underpayment of royalties by LICENSEE, if any.

6.3      Such examination by HARVARD'S accountant shall be at HARVARD'S expense,
         except that if such examination shows an underreporting or underpayment
         in excess of [*** Redacted] percent ([*** Redacted]%) for any
         [*** Redacted] month period, then LICENSEE shall pay the reasonable
         out-of-pocket cost of such examination as well as any additional sum
         that would have been payable to HARVARD had the LICENSEE reported
         correctly, plus interest on said sum at the rate of [*** Redacted]
         percent ([*** Redacted]%) per month.

                                   ARTICLE VII
               DOMESTIC AND FOREIGN PATENT FILING AND MAINTENANCE

7.1      Upon execution of this Agreement, LICENSEE shall reimburse HARVARD for
         all reasonable expenses HARVARD has incurred for the preparation,
         filing, prosecution and

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         maintenance of PATENT RIGHTS. Thereafter, LICENSEE shall reimburse
         HARVARD for all such future expenses within [*** Redacted] days of
         receipt of invoices from HARVARD. Late payment of these invoices shall
         be subject to interest charges of [*** Redacted] percent
         ([*** Redacted]%) per month. HARVARD shall, in its sole discretion, be
         responsible for the preparation, filing, prosecution and maintenance of
         any and all patent applications and patents included in PATENT RIGHTS.
         HARVARD shall consult with LICENSEE as to the preparation, filing,
         prosecution and maintenance of such patent applications and patents and
         shall furnish to LICENSEE copies of documents relevant to any such
         preparation, filing, prosecution or maintenance.

         HARVARD shall be responsible for the preparation, filing, prosecution
         and maintenance of any and all patent applications and patents included
         in PATENT RIGHTS. HARVARD will instruct counsel to directly notify
         HARVARD and LICENSEE and provide them copies of any communications to
         and from the United States and foreign patent offices relating to said
         prosecution, and drafts of all communications to the various patent
         offices, and will instruct counsel to consider any comments on such
         drafts, so that LICENSEE will be informed and apprised of the
         continuing prosecution of patent applications in PATENT RIGHTS.
         LICENSEE shall have reasonable opportunity to participate in decision
         making on key decisions affecting filing, prosecution and maintenance
         of patents and patent applications in PATENT RIGHTS.

7.2      HARVARD and LICENSEE shall cooperate fully in the preparation, filing,
         prosecution and maintenance of PATENT RIGHTS and of all patents and
         patent applications licensed to LICENSEE hereunder, executing all
         papers and instruments or requiring members of HARVARD to execute such
         papers and instruments so as to enable HARVARD to apply for, to
         prosecute and to maintain patent applications and patents in HARVARD'S
         name in any country. Each party shall provide to the other
         [*** Redacted] notice as to all matters which come to its attention and
         which may affect the preparation, filing, prosecution or maintenance of
         any such patent applications or patents. In particular, LICENSEE must
         immediately notify HARVARD if LICENSEE does not qualify as a "small
         entity" as provided by the United States Patent and Trademark Office.

7.3      LICENSEE may elect to surrender its rights to any patent or patent
         application within PATENT RIGHTS in any country upon [*** Redacted]
         days written notice to HARVARD. Such notice shall not relieve LICENSEE
         from responsibility to reimburse HARVARD for expenses under Section 7.1
         relating to the filing, prosecution or maintenance of such patent or
         patent application incurred prior to the receipt of the written notice
         by HARVARD (or a longer period if specified in LICENSEE'S notice).

                                  ARTICLE VIII
                                  INFRINGEMENT

8.1      With respect to any PATENT RIGHTS that have not been rendered
         non-exclusive under Section 3.2(d), LICENSEE shall have the right to
         enforce in its own name and at its own expense any patents within such
         PATENT RIGHTS. HARVARD agrees to notify

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         LICENSEE promptly of each infringement of such patents of which HARVARD
         is or becomes aware.

8.2      (a)      If LICENSEE elects to commence an action as described above,
                  HARVARD may, to the extent permitted by law, elect to join as
                  a party in that action. Regardless of whether HARVARD elects
                  to join as a party, HARVARD shall cooperate fully with
                  LICENSEE in connection with any such action, including making
                  available relevant personnel, information, records, papers,
                  samples, specimens and other similar materials for the
                  purposes of such action as reasonably requested by LICENSEE
                  through the Office of Technology and Trademark Licensing at
                  HARVARD.

         (b)      If HARVARD elects to join as a party pursuant to Subsection
                  (a), HARVARD shall jointly control the action with LICENSEE.

         (c)      LICENSEE shall reimburse HARVARD for any out-of-pocket costs
                  HARVARD reasonably incurs, including reasonable attorneys'
                  fees, as part of an action brought by LICENSEE under Section
                  8.1, whether or not HARVARD becomes a co-plaintiff.

8.3      If LICENSEE elects to commence an action as described above and desires
         that HARVARD be responsible for some of its expenses as described
         immediately below, LICENSEE shall explain its strategy to HARVARD in
         any detail requested by HARVARD. If HARVARD approves of said action in
         writing, LICENSEE may deduct from its [*** Redacted] to HARVARD with
         respect to the patent(s) subject to suit an amount not exceeding [***
         Redacted] percent ([*** Redacted]%) of LICENSEE'S expenses and costs of
         such action, including reasonable attorneys' fees and reimbursement of
         amounts under Section 8.2(c) above; provided, however, that such
         reduction shall not exceed [*** Redacted] percent ([*** Redacted]%) of
         the [*** Redacted] due to HARVARD with respect to the patent(s) subject
         to suit for each calendar year. If such [*** Redacted] percent ([***
         Redacted]%) of LICENSEE's expenses and costs exceeds the amount of [***
         Redacted] deducted by LICENSEE for any calendar year, LICENSEE may to
         that extent reduce [*** Redacted] due to HARVARD from LICENSEE in
         succeeding calendar years, but never by more than [*** Redacted]
         percent ([*** Redacted]%) of the [*** Redacted] due in any [***
         Redacted] with respect to the patent(s) subject to suit.

8.4      Neither party may enter into a settlement, consent judgment or other
         voluntary final disposition of any suit under Section 8.1, 8.6, 8.7 and
         8.8 without the prior written consent of the other party, which consent
         shall not be unreasonably withheld.

8.5      Recoveries or reimbursements from actions commenced pursuant to this
         Article shall first be applied to reimburse LICENSEE and HARVARD for
         litigation costs not paid from royalties [*** Redacted] pursuant to
         Section 8.3. Any remaining recoveries or reimbursements shall be shared
         as follows: if HARVARD approved of said action(s) as described in
         Paragraph 8.3, [*** Redacted]% to LICENSEE and [*** Redacted]% to
         HARVARD, if HARVARD did not approve of said action(s) then
         [*** Redacted] shall be treated as [*** Redacted] and LICENSEE shall
         pay [*** Redacted] of [*** Redacted]% to HARVARD.

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8.6      If LICENSEE elects not to exercise its right to enforce the PATENT
         RIGHTS against any infringement pursuant to this Article, HARVARD may
         do so at its own expense, controlling such action and retaining all
         recoveries therefrom. LICENSEE shall cooperate fully with HARVARD in
         connection with any such action.

8.7      Without limiting the generality of Section 8.6, HARVARD may, at its
         election and by notice to LICENSEE, establish a time limit of [***
         Redacted] days for LICENSEE to decide whether to enforce the PATENT
         RIGHTS against any infringement of which HARVARD is or becomes aware.
         If, by the end of such [*** Redacted] day period, LICENSEE has not (a)
         commenced such an action; (b) taken reasonable efforts to settle such
         infringement; or (c) provided HARVARD with a written report that
         provides LICENSEE'S plans to commence such action or settle such
         infringement in the future and the reasons for any proposed delay in
         commensing such action or settling such infringment, which report must
         be approved by HARVARD, which approval will not unreasonably be denied
         or delayed and which approval shall not be construed as giving approval
         for Paragraph 8.3 purposes, HARVARD may enforce the PATENT RIGHTS
         against such an infringement at its own expense, controlling such
         action and retaining all recoveries therefrom. Notwithstanding sections
         8.6 and 8.7, HARVARD shall not bring any action alleging the
         infringement of PATENT RIGHTS against any sublicensee of LICENSEE under
         PATENT RIGHTS, without the consent of LICENSEE.

8.8      If a declaratory judgment action is brought naming LICENSEE as a
         defendant and alleging invalidity of any of the PATENT RIGHTS, if both
         parties agree, HARVARD may take over the sole defense of the action at
         its own expense. LICENSEE shall cooperate fully with HARVARD in
         connection with any such action.

                                   ARTICLE IX
                            TERMINATION OF AGREEMENT

9.1      The effective date of this Agreement shall be the date that both
         parties have signed the Agreement. This Agreement, unless terminated as
         provided herein, shall remain in effect until the last patent or patent
         application in PATENT RIGHTS has expired or been abandoned.

9.2      HARVARD may terminate this Agreement as follows:

         (a)      If LICENSEE does not make a payment due hereunder and fails to
                  cure such nonpayment (including the payment of interest in
                  accordance with Section 5.4(e)) within [*** Redacted] days
                  after the date of notice in writing of such non-payment by
                  HARVARD. If LICENSEE disputes the amount of such non-payment
                  in writing within such [*** Redacted] day period, HARVARD
                  shall not have the right to terminate this Agreement until it
                  has been determined in an arbitration proceeding under Section
                  11.10 below that LICENSEE has failed to pay amounts owed
                  hereunder, in which case LICENSEE shall pay [*** Redacted] for
                  the

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                  arbitration, and thereafter Licensee does not cure such
                  failure within [*** Redacted] days after such determination.
                  This Section 9.2(a) shall not, however, suspend any obligation
                  of LICENSEE to compensate HARVARD for any undisputed amounts,
                  as provided for under any term of this Agreement, during the
                  pendency of the foregoing arbitration and cure period.

         (b)      If LICENSEE defaults in its obligations under Sections 11.2(c)
                  and 11.2(d) to procure and maintain insurance, and fails to
                  cure such breach within [*** Redacted] days after notice in
                  writing of such breach by HARVARD.

         (c)      If LICENSEE shall make an assignment for the benefit of
                  creditors, or shall have a petition in bankruptcy filed for or
                  against it, provided that such bankruptcy petition is not
                  dismissed within [*** Redacted] days after its filing. Such
                  termination shall be effective immediately upon HARVARD giving
                  written notice to LICENSEE.

         (d)      If LICENSEE is convicted of a felony within the United States
                  relating to the manufacture, use, or sale of LICENSED
                  PRODUCTS.

         (e)      Except as provided in Subsections (a), (b), (c), (d) above, if
                  LICENSEE materially breaches any obligations under this
                  Agreement and the breach has not been cured within [***
                  Redacted] days after the date of notice in writing of such
                  breach by HARVARD. If LICENSEE disputes in writing that it has
                  materially breached this Agreement within such [*** Redacted]
                  day period, HARVARD shall not have the right to terminate this
                  Agreement until it has been determined in an arbitration
                  proceeding under Section 11.10 below that LICENSEE has
                  materially breached this Agreement, in which case LICENSEE
                  shall pay [*** Redacted] for the arbitration, and thereafter
                  Licensee does not cure such breach within [*** Redacted] days
                  after such determination. This Section 9.2(e) shall not,
                  however, suspend any obligation of LICENSEE to compensate
                  HARVARD for any undisputed amounts, as provided for under any
                  term of this Agreement, during the pendency of the foregoing
                  arbitration and cure period.

9.3      All sublicenses granted by LICENSEE under this Agreement in compliance
         with the terms and conditions hereof shall survive the termination of
         this Agreement upon the request of the party to whom such sublicense is
         granted, provided that such party agrees in writing that (i) it will
         pay all royalties or other amounts that otherwise would have been due
         thereafter under such sublicense directly to HARVARD rather than
         LICENSEE, and (ii) HARVARD shall not be held liable for the breach or
         the performance of any obligations stated in such sublicense unless
         such obligations have been expressly assumed in writing by HARVARD.

9.4      LICENSEE may terminate this Agreement by giving [*** Redacted] days
         advance written notice of termination to HARVARD. Upon termination,
         LICENSEE shall promptly submit a Royalty Report to HARVARD for the
         final reporting period and any royalty payments incurred during such
         reporting period, and any unreimbursed patent expenses

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         under Section 7 that have been invoiced by HARVARD, shall become
         immediately payable with such Royalty Report.

9.5      Articles I, VI, IX, X and XI (except for Section 11.7) of this
         Agreement shall survive termination. Article VIII shall survive with
         respect to any infringement of third parties and/or any lawsuits filed
         by or against LICENSEE, prior to the termination of this Agreement. In
         the event this Agreement is terminated for any reason, LICENSEE may,
         within [*** Redacted] after the effective date of such termination,
         sell or otherwise dispose of all LICENSED PRODUCTS that LICENSEE may
         have on hand on the effective date of such termination, and fulfill any
         contracts requiring the use of LICENSED PRODUCTS and/or LICENSED
         PROCESSES that LICENSEE may have entered into prior to the date of such
         termination, subject to LICENSEE'S payment of amounts due to HARVARD
         under Section 4.3 of this Agreement.

                                    ARTICLE X
                         REPRESENTATIONS AND WARRANTIES

10.1     Except for the rights, if any, of the Government of the United States,
         HARVARD represents and warrants that:

         (a)      HARVARD is the owner of the entire right, title and interest
                  in and to the PATENT RIGHTS as they exist on the Effective
                  Date;

         (b)      HARVARD has the right and authority to enter into this
                  Agreement and grant the rights and licenses set forth herein,
                  including without limitation under PATENT RIGHTS;

         (c)      HARVARD has not previously granted, and will not grant in the
                  future, any rights in the PATENT RIGHTS that are inconsistent
                  with the rights and licenses granted to LICENSEE herein;

         (d)      To the best knowledge of HARVARD without having made an
                  investigation, as of the Effective Date, practice of
                  inventions within the PATENT RIGHTS does not infringe any
                  patent rights, trade secrets or other proprietary rights of
                  any third party,

         (e)      To the best knowledge of HARVARD, as of the Effective Date,
                  HARVARD does not own any rights in any other patent or patent
                  application, the claims of which would dominate the claims of
                  a patent or patent application within the PATENT RIGHTS or any
                  practice of PATENT RIGHTS. If HARVARD owns, now or thereafter,
                  any such rights in such patents or patent applications on [***
                  Redacted] is an inventor, HARVARD will negotiate in good faith
                  to the extent it has the legal right to do so with LICENSEE to
                  grant LICENSEE rights to the extent sufficient to practice
                  PATENT RIGHTS, and at commercially reasonable royalties.

         (f)      To the best knowledge of HARVARD, all prior and current
                  agreements between HARVARD and other sponsors of research
                  under which HARVARD has obligations relating to PATENT RIGHTS
                  are listed on Appendix C.

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10.2     Except as set forth in this Agreement, HARVARD does not warrant the
         validity of the PATENT RIGHTS licensed hereunder and makes no
         representations whatsoever with regard to the scope of the licensed
         PATENT RIGHTS or that such PATENT RIGHTS may be exploited by LICENSEE,
         an AFFILIATE, or sublicensee without infringing other patents.

10.3     EXCEPT FOR THE WARRANTIES STATED IN THIS AGREEMENT, HARVARD EXPRESSLY
         DISCLAIMS ANY AND ALL IMPLIED OR EXPRESS WARRANTIES AND MAKES NO
         EXPRESS OR IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR ANY
         PARTICULAR PURPOSE OF THE PATENT RIGHTS OR INFORMATION SUPPLIED BY
         HARVARD, LICENSED PROCESSES OR LICENSED PRODUCTS CONTEMPLATED BY THIS
         AGREEMENT.

                                   ARTICLE XI
                                     GENERAL

11.1     (a)      The parties may, from time to time, in connection with this
                  Agreement disclose to each other Confidential Information. Any
                  Confidential Information shall be in writing and marked
                  "confidential" and disclosed only to the Office of Technology
                  and Trademark Licensing. As used in this Agreement,
                  "Confidential Information" of a party shall mean (i) any
                  information disclosed in writing by such party to the other
                  party, which is marked by such party with the legend
                  "CONFIDENTIAL" or other similar legend sufficient to identify
                  the information as its confidential information, (ii) any
                  information disclosed orally by such party to the other party
                  which is identified as confidential at the time of disclosure
                  and is confirmed as confidential in writing within thirty (30)
                  days after such time of disclosure, or (iii) any information
                  deemed Confidential Information under the terms of this
                  Agreement. With respect to categories (i) and (ii) above,
                  "Confidential Information" shall not include any information
                  that is: (1) already known to the receiving party at the time
                  of disclosure hereunder, or (2) now or hereafter becomes
                  publicly known other than through acts or omissions of the
                  receiving party, or (3) is disclosed to the receiving party by
                  a third party under no obligation of confidentiality to the
                  disclosing party or (4) is independently developed by the
                  receiving party without use of the Confidential Information of
                  the disclosing party.

         (b)         Each party shall maintain in confidence, and shall not use
                  for any purpose or disclose to any third party, the
                  Confidential Information of the other party. Notwithstanding
                  the foregoing, the receiving party may use or disclose the
                  Confidential Information of the disclosing party (i) to the
                  extent necessary to exercise its rights or fulfill its
                  obligations and/or duties under this Agreement, and (ii) to
                  comply with applicable law or governmental regulations or
                  court order, provided that the receiving party will give
                  reasonable advance notice to the disclosing party, and will
                  use its reasonable efforts to minimize the disclosure of
                  Confidential Information and to secure confidential treatment
                  of any Confidential Information disclosed.

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         (c)      The royalty terms of this Agreement shall be deemed
                  "Confidential Information" of both parties. In addition to the
                  permissible disclosures set forth in subsection (b) above,
                  LICENSEE may disclose such terms in confidence to its
                  financial and legal advisors, consultants, potential or actual
                  investors, potential or actual merger or acquisition partners,
                  and others on a need-to-know basis.

11.2     (a)      LICENSEE shall indemnify, defend and hold harmless HARVARD and
                  its current or former and future directors, governing board
                  members, trustees, officers, faculty and employees
                  (collectively, the "INDEMNITEES"), from and against any claim,
                  lawsuit, cause of action , liability, cost, expense, damage,
                  deficiency, loss or obligation of any kind or nature
                  (including, without limitation, reasonable attorney's fees and
                  other costs and expenses of litigation) (collectively,
                  "Claims"), based upon, arising out of, or otherwise relating
                  to: LICENSEE'S or any sublicensee's performance of (or failure
                  to perform) any of its obligations under this Agreement or any
                  sublicense agreement, or the practice by LICENSEE or any
                  sublicensee of any right or license granted under this
                  Agreement or any sublicense agreement, or any product,
                  process, or service made, used or sold pursuant to any right
                  or license granted under this Agreement or any sublicense
                  agreement, including without limitation any Claim relating to
                  product liability (whether based on negligence or other tort,
                  warranty, strict liability, or any other theory), except to
                  the extent such Claims are directly attributable to
                  intentional misconduct of any INDEMNITEES. It shall be a
                  condition of the foregoing obligation that (i) LICENSEE
                  receives prompt notice of any such Claims; (ii) LICENSEE is
                  given the exclusive right to control the defense and
                  settlement of such Claims, provided that LICENSEE shall not
                  settle any such Claim without the prior written consent of
                  HARVARD, which consent shall not be unreasonably withheld; and
                  (iii) LICENSEE shall not be obligated to indemnify any
                  INDEMNITEE in connection with any settlement for any Claim
                  unless LICENSEE consents in writing to such settlement.

         (b)      LICENSEE shall, at its own expense, defend against any actions
                  brought or filed against any INDEMNITEE hereunder with respect
                  to the subject of indemnity contained herein, whether or not
                  such actions are rightfully brought.

         (c)      Beginning at the time any such product, process or service is
                  being commercially distributed or sold (other than for the
                  purpose of obtaining regulatory approvals) by LICENSEE or by a
                  SUBLICENSEE, AFFILIATE or agent of LICENSEE, LICENSEE shall,
                  at its sole cost and expense, procure and maintain commercial
                  general liability insurance in amounts not less than
                  [*** Redacted] per incident and [*** Redacted] annual
                  aggregate and naming the Indemnitees as additional insureds.
                  During clinical trials of any such product, process or
                  service, LICENSEE shall, at its sole cost and expense, procure
                  and maintain commercial general liability insurance in such
                  equal or lesser amount as HARVARD shall require, naming the
                  Indemnitees as additional insureds. Such commercial general
                  liability insurance shall provide: (i) product liability
                  coverage; and (ii) broad form contractual liability coverage
                  for LICENSEE'S indemnification under this Agreement. If
                  LICENSEE elects to self-insure all or part of the limits
                  described above (including deductibles or retentions

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                  which are in excess of [*** Redacted] annual aggregate) such
                  self-insurance program must be acceptable to HARVARD and the
                  Risk Management Foundation of the Harvard Medical
                  Institutions, Inc. in their sole discretion. The minimum
                  amounts of insurance coverage required shall not be construed
                  to create a limit of LICENSEE'S liability with respect to its
                  indemnification under this Agreement.

         (d)      LICENSEE shall provide HARVARD with written evidence of such
                  insurance upon request of HARVARD. LICENSEE shall provide
                  HARVARD with written notice at least fifteen (15) days prior
                  to the cancellation, non-renewal or material change in such
                  insurance; if LICENSEE does not obtain replacement insurance
                  providing comparable coverage within such fifteen (15) day
                  period, HARVARD shall have the right to terminate this
                  Agreement in accordance with Section 9.2(b).

         (e)      LICENSEE shall maintain such commercial general liability
                  insurance beyond the expiration or termination of this
                  Agreement during: (i) the period that any product, process, or
                  service, relating to, or developed pursuant to, this Agreement
                  is being commercially distributed or sold by LICENSEE or by a
                  sublicensee, AFFILIATE or agent of LICENSEE; and (ii) a
                  reasonable period after the period referred to in Subsection
                  (e)(i) above which in no event shall be less than
                  [*** Redacted].

11.3     Nothing in this Agreement shall be construed as conferring any right to
         use HARVARD's name or insignia, or any adaptation of them, or the name
         of any of HARVARD's inventors in any advertising, promotional or sales
         literature without the prior written approval of HARVARD, or the
         inventor in the case of the use of the name of an inventor.

11.4     Except as stated in this Section 11.4, without the prior written
         approval of HARVARD in each instance, neither this Agreement nor the
         rights granted hereunder shall be transferred or assigned in whole or
         in part by LICENSEE to any person whether voluntarily or involuntarily,
         by operation of law or otherwise. LICENSEE may transfer or assign this
         Agreement and all rights hereunder, upon notice to HARVARD but without
         its consent, to any entity that succeeds to all or substantially all of
         the business of LICENSEE to which this Agreements pertains, whether by
         merger, operation of law, purchase or sale of all or substantially all
         of LICENSEE's stock or assets or otherwise; provided that such assignee
         or transferee promptly agrees in writing to be bound by the terms and
         conditions of this Agreement. Subject to the foregoing, this Agreement
         shall be binding upon the respective successors, legal representatives
         and assignees of HARVARD and LICENSEE.

11.5     The interpretation and application of the provisions of this Agreement
         shall be governed by the laws of the Commonwealth of Massachusetts.

11.6     LICENSEE shall comply with all applicable laws and regulations. In
         particular, it is understood and acknowledged that the transfer of
         certain commodities and technical data is subject to United States laws
         and regulations controlling the export of such commodities and
         technical data, including all Export Administration Regulations of the
         United States Department of Commerce. These laws and regulations among
         other things, prohibit or require a license for the export of certain
         types of technical data to certain specified

*** Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Commission.

                                                                              22

<PAGE>

         countries. LICENSEE hereby agrees and gives written assurance that it
         will comply with all United States laws and regulations controlling the
         export of commodities and technical data, that it will be solely
         responsible for any violation of such by LICENSEE or its AFFILIATES or
         sublicensees, and that it will defend and hold HARVARD harmless in the
         event of any legal action of any nature occasioned by such violation
         with respect to LICENSED PRODUCTS.

11.7     LICENSEE agrees: (i) to obtain all regulatory approvals required for
         the manufacture and sale of LICENSED PRODUCTS and LICENSED PROCESSES;
         and (ii) to mark LICENSED PRODUCTS with the numbers of the applicable
         patents within PATENT RIGHTS, to the extent required by law. LICENSEE
         also agrees to register or record this Agreement as is required by law
         or regulation in any country where the license is in effect, and
         HARVARD shall cooperate fully with LICENSEE in connection with any such
         registration or recordation.

11.8     Any notices to be given hereunder shall be sufficient if signed by the
         party (or party's attorney) giving same and either: (i) delivered in
         person; (ii) mailed certified mail return receipt requested; or (iii)
         faxed to other party if the sender has evidence of successful
         transmission and if the sender promptly sends the original by ordinary
         mail, in any event to the following addresses:

         If to LICENSEE:
           NanoSys, Inc.
           2625 Hanover Street
           Palo Alto, CA 94304
           Attn: Lawrence A. Bock
           Fax: 650-745-1273

         cc:      Wilson, Sonsini, Goodrich & Rosati
                  650 Page Mill Road
                  Palo Alto, California 94304
                  Attn: Michael J. O'Donnell, Esq.
                  Fax: 650/493-6811

         If to HARVARD:
                  Office for Technology and Trademark Licensing
                  Harvard University
                  Holyoke Center, Suite 727
                  1350 Massachusetts Avenue
                  Cambridge, MA 02138
                  Fax: (617) 495-9568

         By such notice either party may change their address for future
         notices.

                                                                              23

<PAGE>

         Notices delivered in person shall be deemed given on the date
         delivered. Notices sent by fax shall be deemed given on the date faxed.
         Notices mailed shall be deemed given on the date postmarked on the
         envelope.

11.9     Should a court of competent jurisdiction later hold any provision of
         this Agreement to be invalid, illegal, or unenforceable, and such
         holding is not reversed on appeal, it shall be considered severed from
         this Agreement. All other provisions, rights and obligations shall
         continue without regard to the severed provision, provided that the
         remaining provisions of this Agreement are in accordance with the
         intention of the parties.

11.10    In the event of any controversy or claim arising out of or relating to
         any provision of this Agreement or the breach thereof, the parties
         shall try to settle such conflict amicably between themselves. Subject
         to the limitation stated in the final sentence of this Section, any
         such conflict which the parties are unable to resolve promptly shall be
         settled through arbitration conducted in accordance with the rules of
         the American Arbitration Association. The demand for arbitration shall
         be filed within [*** Redacted] after the controversy or claim has
         arisen, and in no event after the date upon which institution of legal
         proceedings based on such controversy or claim would be barred by the
         applicable statute of limitation. Such arbitration shall be held in
         Boston, Massachusetts. The award through arbitration shall be final and
         binding. Either party may enter any such award in a court having
         jurisdiction or may make application to such court for judicial
         acceptance of the award and an order of enforcement, as the case may
         be. Notwithstanding the foregoing, either party may, without recourse
         to arbitration, assert against the other party a third-party claim or
         cross-claim in any action brought by a third party, to which the
         subject matter of this Agreement may be relevant.

11.11    This Agreement constitutes the entire understanding between the parties
         and neither party shall be obligated by any condition or representation
         other than those expressly stated herein or as may be subsequently
         agreed to by the parties hereto in writing.

11.12    Nothing in this Agreement shall be deemed to prevent LICENSEE from
         commercializing products similar to or competitive with a LICENSED
         PRODUCT, so long as LICENSEE complies with its obligations under this
         Agreement.

11.13    The relationship between HARVARD and LICENSEE established by this
         Agreement is that of independent contractors. Nothing in this Agreement
         shall be construed to create any other relationship between HARVARD and
         LICENSEE. Neither party shall have any right, power or authority to
         assume, create or incur any expense, liability or obligation, express
         or implied, on behalf of the other.

11.14    In the event either party hereto is prevented from or delayed in the
         performance of any of its obligations hereunder by reason of acts of
         God, war, strikes, riots, storms, fires or any other cause whatsoever
         beyond the reasonable control of the party, the party so prevented or
         delayed shall be excused from the performance of any such obligation to
         the extent and during the period of such prevention or delay.

*** Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Commission.

                                                                              24

<PAGE>

11.15    NEITHER PARTY SHALL BE LIABLE TO THE OTHER PARTY OR TO ANY THIRD PARTY
         FOR ANY SPECIAL, CONSEQUENTIAL, EXEMPLARY OR INCIDENTAL DAMAGES
         (INCLUDING LOST OR ANTICIPATED REVENUES OR PROFITS RELATING TO THE
         SAME), ARISING FROM ANY CLAIM RELATING TO THIS AGREEMENT, WHETHER SUCH
         CLAIM IS BASED ON CONTRACT, TORT (INCLUDING NEGLIGENCE) OR OTHERWISE,
         EVEN IF AN AUTHORIZED REPRESENTATIVE OF SUCH PARTY IS ADVISED OF THE
         POSSIBILITY OR LIKELIHOOD OF SAME. For the avoidance of doubt, the
         parties acknowledge that the foregoing limitation of liability is not
         intended to apply to any of the following damages of HARVARD (and
         accordingly such damages shall be recoverable by HARVARD to the same
         extent they would be in the absence of that limitation): (i) amounts
         owed to HARVARD pursuant to the terms of this Agreement; (ii) amounts
         covered by LICENSEE's indemnity of Section 11.2; (iii) damages for
         infringement or violation of any patent, copyright, trademark, or other
         intellectual property right of HARVARD; and (iv) damages arising from
         the willful misconduct of LICENSEE.

11.16    HARVARD'S AGGREGATE LIABILITY FOR ALL DAMAGES OF ANY KIND RELATING TO
         THIS AGREEMENT OR ITS SUBJECT MATTER (WHETHER SUCH DAMAGES ARE BASED ON
         CONTRACT, TORT, INCLUDING NEGLIGENCE, OR OTHERWISE) SHALL NOT EXCEED
         THE AMOUNT PAID BY LICENSEE TO HARVARD UNDER THIS AGREEMENT.

11.17    This Agreement may be executed in counterparts, each of which shall be
         deemed an original, but both of which together shall constitute one and
         the same instrument.

         IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
         executed by their duly authorized representatives.

         PRESIDENT AND FELLOWS                                NANOSYS, INC

           OF HARVARD COLLEGE

          /s/  Joyce Brinton                             /s/ Calvin Chow
         ------------------------------------------      -----------------------
         Joyce Brinton, Director                               Signature
         Office for Technology and Trademark Licensing

                                                         Calvin Chow
                                                         -----------------------
                                                                  Name

                  4/15/03                                Chief Operating Officer
         ------------------------------                  -----------------------
                   Date                                          Title

                                                                4-25-03
                                                         -----------------------
                                                                  Date

                                                                              25

<PAGE>

                                   APPENDIX A

The following comprise PATENT RIGHTS:

[*** Redacted]

*** Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Commission.

                                                                              26

<PAGE>

                                   APPENDIX B

<TABLE>
<CAPTION>
CASE       LEAD INVENTOR                    TITLE                           AGENCY                    GRANT NUMBERS
---------------------------------------------------------------------------------------------------------------------
<S>       <C>               <C>                                       <C>                            <C>
[*** Redacted]
</TABLE>

*** Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Commission.

                                                                              27

<PAGE>
                                   APPENDIX C

            Exclusive License of Harvard Case 2058 to Nano Sys, Inc.

                                   ASSIGNMENT

         THIS ASSIGNMENT is made effective on 1st day of January, 2003 between:

         (1)      [*** Redacted], a legal body organised under the laws of
England (hereinafter the "Assignor") and

         (2)      PRESIDENT AND FELLOWS OF HARVARD COLLEGE, a nonprofit
Massachusetts educational corporation having offices at the Office for
Technology and Trademark Licensing, Holyoke Center, Suite 727,1350 Massachusetts
Avenue, Cambridge, Massachusetts 02138 (hereinafter the "Assignee").

         WHEREAS:

         (A)      The Assignor has ownership rights in the invention of U.S.
Patent Application serial number [*** Redacted], and corresponding International
Patent Application Serial No. [*** Redacted], both entitled "[*** Redacted]",
both filed [*** Redacted], which carry the internal Assignee case number
designation of [*** Redacted] and the internal Assignor case number designation
of [*** Redacted] (hereinafter "the Patent Applications"), by virtue of the
contract of employment of [*** Redacted] with the Assignor; and

         (B)      The Assignor wishes to assign its ownership rights in the
invention including the Patent Applications to the Assignee.

         NOW THIS ASSIGNMENT WITNESSETH:

         In consideration of the sum of one pound sterling and other good and
valuable consideration the receipt of which the Assignor hereby acknowledges the
Assignor

*** Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Commission.
<PAGE>

hereby assigns and conveys unto the Assignee absolutely the invention and the
Patent Applications thereto together with all right, title and interest in and
to said applications and in and to any continuations, divisionals,
continuation-in-part patent applications (to the extent a person under an
obligation to assign patent rights to the Assignee and [*** Redacted] are both
properly named inventors, based on U.S. patent law) and patents which issue on
said applications including patents of reissue or re-examination, worldwide,
together with all rights of action powers and benefits belonging or accrued to
the same including the right to claim priority under the Paris Convention.

         IN WITNESS WHEREOF the parties have executed and delivered these
presents in the United Kingdom:

EXECUTED by [*** Redacted].

in accordance with its charter of incorporation:

                                                        19, Dec. 2002
[*** Redacted]                                ----------------------------------
                                                            Date

EXECUTED by the PRESIDENT AND FELLOWS OF HARVARD COLLEGE.
in accordance with the laws of its incorporation:

/s/ Joyce Brinton                                          1/6/03
-----------------------                       ----------------------------------
Joyce Brinton                                               Date
Director of the Office for Technology and Trademark Licensing
Harvard University

*** Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Commission.<PAGE>

                                                                    EXHIBIT 10.6

                                LEASE AGREEMENT

         THIS LEASE AGREEMENT is dated as of January 30, 2002 between
ARE-2625/2627/2631 HANOVER, LLC, a Delaware limited liability company
("LANDLORD"), and NANOSYS, INC., a Delaware corporation ("TENANT").

BUILDING:           2625 Hanover Street, Palo Alto, California

PREMISES:           That portion of the Building, containing approximately 8,424
                    rentable square feet, as determined by Landlord, as shown on
                    EXHIBIT A.

PROJECT:            The real property on which the Building is located, together
                    with all improvements thereon and appurtenances thereto as
                    described on EXHIBIT B.

BASE RENT:          $29,484.00 per month during the Term.

TENANT'S SHARE:     26.26%

SECURITY DEPOSIT:   $29,484

TARGET COMMENCEMENT DATE: March 1, 2002

TERM:               Beginning on the Commencement Date and ending on March 31,
                    2004.

PERMITTED USE:      Research and development laboratory, related office and
                    other related uses consistent with the character of the
                    Project and otherwise in compliance with the provisions of
                    Section 6 hereof

<TABLE>
<CAPTION>
ADDRESS FOR RENT PAYMENT:         LANDLORD'S NOTICE ADDRESS:         TENANT'S NOTICE ADDRESS:
<S>                               <C>                                <C>
135 N. Los Robles Avenue          135 N. Los Robles Avenue           2625 Hanover Street
Suite 250                         Suite 250                          Palo Alto, CA 94301
Pasadena, CA 91101                Pasadena, CA 91101                 Attention: CFO
Attention: Accounts Receivable    Attention: Corporate Secretary     Facsimile:
                                  Facsimile: (626) 578-0770

                                                                     WITH A COPY TO:
                                                                     Calvin Chou
                                                                     455 Minoca Road
                                                                     Portola Valley. CA 94028
</TABLE>

         1.       LEASE OF PREMISES AND TEMPORARY SPACE. Upon and subject to all
of the terms and conditions hereof, Landlord hereby leases the Premises to
Tenant and Tenant hereby leases the Premises from Landlord. The portions of the
Project that are for the non-exclusive use of tenants of the Project are
collectively referred to herein as the "COMMON AREAS", which Tenant may use in
common with other tenants of the Project. Landlord reserves the right to modify
Common Areas so long as any modification does not unreasonably interfere with
Tenant's use of the Premises.

         Tenant hereby acknowledges and agrees that the Premises is currently
subject to a lease (the "EXISTING LEASE") with Xenoport, Inc. Xenoport, Inc. has
informed Landlord of its intention to vacate the Premises no later than February
28, 2002. This Lease and Landlord's obligations hereunder shall be subject to
(i) Landlord negotiating an agreement ("TERMINATION AGREEMENT") with Xenoport,
Inc., regarding the termination of the Existing Lease on terms and conditions
acceptable to Landlord in its sole and absolute discretion, (ii) Landlord's
receipt of a fully executed Termination Agreement with respect to the Existing
Lease and the vacation of the Premises by Xenoport, Inc., and (iii) Landlord's
receipt of final decommissioning certification with respect to the Premises from
all applicable governmental authorities.

              (C) ALL RIGHTS RESERVED 2001 ALEXANDRIA REAL ESTATE EQUITIES, INC.
                                                      CONFIDENTIAL - DO NOT COPY

<PAGE>

Short Form 3N Laboratory Lease              2625 HANOVER STREET/NANOSYS - PAGE 2

         2.       DELIVERY; ACCEPTANCE OF PREMISES; COMMENCEMENT DATE. Landlord
shall use reasonable efforts to deliver the Premises to Tenant for the conduct
of Tenant's business on or before the Target Commencement Date ("DELIVERY" or
"DELIVER"). The parties acknowledge that Delivery of the Premises is subject to
Landlord's receipt of final decommissioning certification of the Premises from
all applicable governmental authorities. If Landlord fails to timely Deliver the
Premises, Landlord shall not be liable to Tenant for any loss or damage
resulting therefrom, and this Lease shall not be void or voidable except as
provided herein. If Landlord fails to so Deliver the Premises within 30 days of
the Target Commencement Date, then after actual Delivery, payment of Base Rent
under this Lease shall abate one day for each day that Landlord failed to
deliver the Premises after the end of such 30 day period. If Landlord fails to
Deliver the Premises for more than 60 days after the Target Commencement Date,
then, for a period of 5 business days after the end of such 60 day period, this
Lease shall be voidable by Tenant by written notice to Landlord, and if so
voided: (a) the Security Deposit, or any balance thereof (i.e., after deducting
therefrom all amounts to which Landlord is entitled under the provisions of this
Lease), shall be returned to Tenant, and (b) neither Landlord nor Tenant shall
have any further rights, duties or obligations under this Lease. The
"COMMENCEMENT DATE" shall be the later of (i) the date Landlord Delivers
possession of the Premises to Tenant, or (ii) March 1, 2002. Upon request of
Landlord, Tenant shall execute and deliver a written acknowledgment of the
Commencement Date and the expiration date of the Term when such are established
in the form of the "Acknowledgement of Commencement Date" attached to this Lease
as EXHIBIT D; provided, however, Tenant's failure to execute and deliver such
acknowledgment shall not affect Landlord's rights hereunder.

         Effective as of the Commencement Date, except as otherwise expressly
provided herein: (i) Tenant shall accept the Premises in their condition as of
such date, subject to all applicable Legal Requirements (as defined in Section 6
hereof); (ii) Landlord shall have no obligation for any defects in the Premises;
and (iii) Tenant's taking possession of the Premises shall be conclusive
evidence that Tenant accepts the Premises and that the Premises were in good
condition at the time of Delivery. To Landlord's actual knowledge, as of the
date of completion of construction of the core and shell of the Building, the
Building was in compliance with applicable law.

         To Landlord's actual knowledge, all of the Building systems function
properly and are in good working order, and the roof of the Building does not
leak. For a period of 90 days after the Commencement Date, Landlord and Tenant
shall jointly monitor Building Systems and the roof, and Landlord will make any
repairs deemed by the parties to be reasonably necessary. During such 90 day
period, the cost of any such repair shall be paid by Landlord, unless Tenant was
solely responsible for the cause of such repair, in which case Tenant shall pay
the cost.

         Landlord, at its sole cost and expense (which shall not constitute an
Operating Expense) shall promptly balance the heating and air conditioning
system of the Premises if Tenant requests at any time prior to December 31,
2002.

         Tenant agrees and acknowledges that, except as expressly set forth
herein, neither Landlord nor any agent of Landlord has made any representation
or warranty with respect to the condition of all or any portion of the Premises
or the Project, and/or the suitability of the Premises or the Project for the
conduct of Tenant's business, and Tenant waives any implied warranty that the
Premises or the Project are suitable for the Permitted Use. This Lease
constitutes the complete agreement of Landlord and Tenant with respect to the
subject matter hereof and supersedes any and all prior representations,
inducements, promises, agreements, understandings and negotiations which are not
contained herein.

         3.       BASE RENT.

         (a)      The first month's Base Rent and the Security Deposit shall be
due and payable on delivery of an executed copy of this Lease to Landlord.
Tenant shall pay to Landlord in advance, monthly installments of Base Rent on or
before the first day of each calendar month during the Term hereof, in lawful
money of the United States of America, at the office of Landlord for payment of
Rent set forth above. Payments of Base Rent for any fractional calendar month
shall be prorated. Tenant shall have no right at any time to abate, reduce, or
set-off any Rent due hereunder.

              (C) ALL RIGHTS RESERVED 2001 ALEXANDRIA REAL ESTATE EQUITIES, INC.
                                                      CONFIDENTIAL - DO NOT COPY

<PAGE>

Short Form 3N Laboratory Lease              2625 HANOVER STREET/NANOSYS - PAGE 3

         (b)      In addition to Base Rent, Tenant agrees to pay to Landlord as
additional rent ("ADDITIONAL RENT"): (i) Tenant's Share of Operating Expenses
(as defined in Section 4) and (ii) any and all other amounts Tenant assumes or
agrees to pay under the provisions of this Lease, including, without limitation,
any and all other reasonable sums that may become due by reason of any default
of Tenant or failure to comply with the agreements, terms, covenants and
conditions of this Lease to be performed by Tenant, after expiration of any
applicable notice and cure period. Tenant's obligation to pay Base Rent and
Additional Rent hereunder are collectively referred to herein as "RENT".

         4.       OPERATING EXPENSE PAYMENTS. During each month of the Term, on
the same date that Base Rent is due, Tenant shall pay Landlord an amount equal
to 1/12 of Tenant's Share of Landlord's written estimate of Operating Expenses
for each calendar year during the Term (the "ANNUAL ESTIMATE"). Payments for any
fractional calendar month shall be prorated. The term "OPERATING EXPENSES" means
all costs and expenses, including but not limited to taxes and insurance,
reasonably determined and actually incurred by Landlord, in accordance with
Landlord's normal practice, to be properly allocable to tenants in the Building,
capital repairs and improvements amortized over the lesser of 7 years and the
useful life of such capital items, and as Additional Rent administration rent
in the amount of 3% of Base Rent, but excluding:

         (a)      the original construction costs of the Project and renovation
prior to the date of the Lease and costs of correcting defects in such original
construction or renovation;

         (b)      capital expenditures for expansion of the Project;

         (c)      interest, principal payments on any debts of Landlord,
financing costs and amortization of funds borrowed by Landlord, whether secured
or unsecured and all payments of base rent (but not taxes or operating expenses)
under any ground lease or other underlying lease of all or any portion of the
Project;

         (d)      depreciation of the Project (except for capital improvements,
the cost of which are includable in Operating Expenses);

         (e)      advertising, legal and space planning expenses and leasing
commissions and other costs and expenses incurred in procuring and leasing space
to tenants for the Project, including any leasing office maintained in the
Project, free rent and construction allowances for tenants;

         (f)      legal and other expenses incurred in the negotiation or
enforcement of leases;

         (g)      completing, fixturing, improving, renovating, painting,
redecorating or other work, which Landlord pays for or performs for other
tenants within their premises, and costs of correcting defects in such work;

         (h)      costs of utilities outside normal business hours sold to
tenants of the Project;

         (i)      costs to be reimbursed by other tenants of the Project or
Taxes to be paid directly by Tenant or other tenants of the Project, whether or
not actually paid;

         (j)      salaries, wages, benefits and other compensation paid to
officers and employees of Landlord who are not assigned in whole or in part to
the operation, management, maintenance or repair of the Project;

         (k)      general organizational, administrative and overhead costs
relating to maintaining Landlord's existence, either as a corporation,
partnership, or other entity, including general corporate, legal and accounting
expenses;

              (C) ALL RIGHTS RESERVED 2001 ALEXANDRIA REAL ESTATE EQUITIES, INC.
                                                      CONFIDENTIAL - DO NOT COPY

<PAGE>

Short Form 3N Laboratory Lease              2625 HANOVER STREET/NANOSYS - PAGE 4

         (l)      costs (including attorneys' fees and costs of settlement,
judgments and payments in lieu thereof) incurred in connection with disputes
with tenants, other occupants, or prospective tenants, and costs and expenses,
including legal fees, incurred in connection with negotiations or disputes with
employees, consultants, management agents, leasing agents, purchasers or
mortgagees of the Building;

         (m)      costs incurred by Landlord due to the violation by Landlord,
its employees, agents or contractors or any tenant of the terms and conditions
of any lease of space in the Project or any Legal Requirement;

         (n)      penalties, fines or interest incurred as a result of
Landlord's inability or failure to make payment of Taxes and/or to file any tax
or informational returns when due, or from Landlord's failure to make any
payment of Taxes required to be made by Landlord hereunder before delinquency;

         (o)      overhead and profit increment paid to Landlord or to
subsidiaries or affiliates of Landlord for goods and/or services in or to the
Project to the extent the same exceeds the costs of such goods and/or services
rendered by unaffiliated third parties on a competitive basis;

         (p)      costs of Landlord's charitable or political contributions, or
of fine art maintained at the Project;

         (q)      costs in connection with services (including electricity),
items or other benefits of a type which are not standard for the Project and
which are not available to Tenant without specific charges therefor, but which
are provided to another tenant or occupant of the Project, whether or not such
other tenant or occupant is specifically charged therefor by Landlord;

         (r)      costs incurred in the sale or refinancing of the Project;

         (s)      net income taxes of Landlord or the owner of any interest in
the Project, franchise, capital stock, gift, estate or inheritance taxes or any
federal, state or local documentary taxes imposed against the Project or any
portion thereof or interest therein; and

         (t)      any expenses otherwise includable within Operating Expenses to
the extent actually reimbursed by persons other than tenants of the Project
under leases for space in the Project.

         Within 90 days after the end of each calendar year (or such longer
period as may be reasonably required), Landlord shall furnish to Tenant a
statement (an "ANNUAL STATEMENT") showing in reasonable detail: (a) the total
and Tenant's Share of actual Operating Expenses for the previous calendar year,
and (b) the total of Tenant's payments in respect of Operating Expenses for such
year. If Tenant's Share of actual Operating Expenses for such year exceeds
Tenant's payments of Operating Expenses for such year, the excess shall be due
and payable by Tenant as Rent within 30 days after delivery of such Annual
Statement to Tenant. If Tenant's payments of Operating Expenses for such year
exceed Tenant's Share of actual Operating Expenses for such year Landlord shall
pay the excess to Tenant within 30 days after delivery of such Annual Statement,
except that after the expiration, or earlier termination of the Term or if
Tenant is delinquent in its obligation to pay Rent, Landlord shall pay the
excess to Tenant after deducting all other amounts due Landlord.

         5.       SECURITY DEPOSIT. Tenant shall deposit with Landlord upon
delivery of an executed copy of this Lease to Landlord and at all times during
the Term maintain security (the "SECURITY DEPOSIT") for the performance of all
of its obligations in the amount set forth in the Basic Lease Provisions, which
Security Deposit shall be in cash. Upon each occurrence of a Default (as defined
in Section 16), Landlord may use all or any part of the Security Deposit as
necessary to pay delinquent payments due under this Lease, and the cost of any
damage, injury, expense or liability caused by such Default, without prejudice
to any other remedy provided herein or by law. Tenant hereby waives the
provisions of any law, now or hereafter in force, which provide that Landlord
may claim from a security deposit only those sums reasonably necessary to remedy
defaults in the payment of Rent, to repair damage caused by

              (C) ALL RIGHTS RESERVED 2001 ALEXANDRIA REAL ESTATE EQUITIES, INC.
                                                      CONFIDENTIAL - DO NOT COPY

<PAGE>

Short Form 3N Laboratory Lease              2625 HANOVER STREET/NANOSYS - PAGE 5

Tenant or to clean the Premises, it being agreed that Landlord may, in addition,
claim those sums; reasonably necessary to compensate Landlord for any other
loss or damage, foreseeable or unforeseeable, caused by the act or omission of
Tenant or any officer, employee, agent or invitee of Tenant.

         6.       USE. The Premises shall be used solely for the Permitted Use
set forth in the Basic Lease Provisions, in compliance with all laws, orders,
judgments, ordinances, regulations, codes, directives, permits, licenses,
covenants and restrictions now or hereafter applicable to Tenant's use and
occupancy of the Premises (collectively, "LEGAL REQUIREMENTS"). Tenant will use
the Premises in a careful, safe and proper manner and will not commit waste,
overload the floor or structure of the Premises, subject the Premises to use
that would damage the Premises or obstruct or interfere with the rights of
Landlord or other tenants or occupants of the Project, including conducting or
giving notice of any auction, liquidation, or going out of business sale on the
Premises, or using or allowing the Premises to be used for any unlawful purpose.
Tenant shall not be required to comply or to cause the Premises to comply with
any laws, rules or regulations requiring the construction of alterations unless
the requirement; for such alterations arises as a result of Tenant's particular
use of the Premises.

         7.       HOLDING OVER. If Tenant remains in possession of the Premises
after the expiration or earlier termination of the Term without the express
written consent of Landlord, (A) Tenant shall become a tenant at sufferance upon
the terms of this Lease except that the monthly rental shall be equal to 150% of
the Rent in effect during the last 30 days of the Term, and (B) Tenant shall be
responsible for all damages suffered by Landlord resulting from or occasioned by
Tenant's holding over, including consequential damages. Acceptance by Landlord
of Rent after the expiration of the Term or earlier termination of this Lease
shall not result in a renewal or reinstatement of this Lease.

         8.       PARKING. At any time prior to January 1, 2003, Tenant shall be
entitled to use an aggregate of 18 parking stalls, at no cost, in those areas
designated for non-reserved parking in common with other tenants of the Project.
From and after January 1, 2003, Landlord shall make a commercially reasonable
effort to make available to Tenant 3 parking stalls for each 1,000 rentable
square feet of the Premises; provided that Landlord shall not be in default of
its obligation to provide those parking stalls if Landlord is unable to provide
such parking stalls. If Landlord is unable to provide 3 parking stalls per 1,000
rentable square feet of the Premises, Landlord shall make a commercially
reasonable effort to provide alternative parking to Tenant, at no cost to
Tenant, until such time as Landlord can provide 3 parking stalls per 1,000
rentable square feet of the Premises.

         9.       UTILITIES, SERVICES. Landlord shall provide, subject to the
terms of this Section 9, utilities to the Premises ("UTILITIES"). Tenant shall
pay directly to the Utility provider, prior to delinquency, any separately
metered Utilities and services which may be furnished to Tenant or the Premises
during the Term. No interruption or failure of Utilities, from any cause
whatsoever other than Landlord's willful misconduct, shall result in abatement
of Rent. Tenant agrees to limit use of water and sewer with respect to Common
Areas to normal restroom use.

         10.      ALTERATIONS. Tenant shall not make any alterations, additions,
or improvements to the Premises of any kind whatsoever, except as provided in
this Section 10. Any alterations, additions, or improvements made to the
Premises by or on behalf of Tenant, including additional locks or bolts of any
kind or nature upon any doors or windows in the Premises, but excluding
installation, removal or realignment of furniture systems (other than removal of
furniture systems owned or paid for by Landlord) not involving any modifications
to the structure or connections (other than by ordinary plugs or jacks) to
Building systems ("ALTERATIONS") shall be subject to Landlord's prior written
consent, which may be given or withheld in Landlord's sole discretion if any
such Alteration affects the laboratory use, the structure on any Building
systems. Tenant may construct nonstructural Alterations in the Premises without
Landlord's prior approval if the aggregate cost of all such work during the
Term does not exceed $25,000 (a "NOTICE-ONLY ALTERATION"), provided Tenant
notifies Landlord in writing of such intended Notice-Only Alteration and such
notice shall be accompanied by plans, specifications, work contracts and such
other information concerning the nature and cost of the Notice-Only Alteration
as may be reasonably requested by Landlord, which notice and accompanying
materials shall be delivered to Landlord not less than 15

              (C) ALL RIGHTS RESERVED 2001 ALEXANDRIA REAL ESTATE EQUITIES, INC.
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Short Form 3N Laboratory Lease              2625 HANOVER STREET/NANOSYS - PAGE 6

business days in advance of any proposed construction. If Landlord approves any
Alterations, Landlord may impose such conditions on Tenant in connection with
the commencement, performance and completion of such Alterations as Landlord may
deem appropriate in Landlord's sole and absolute discretion. Any request for
approval shall be in writing, delivered not less than 15 business days in
advance of any proposed construction, and accompanied by plans, specifications,
bid proposals, work contracts and such other information concerning the nature
and cost of the alterations as may be reasonably requested by Landlord,
including the identities and mailing addresses of all persons performing work
or supplying materials. Landlord's right to review plans and specifications and
to monitor construction shall be solely for its own benefit, and Landlord shall
have no duty to ensure that such plans and specifications or construction comply
with applicable Legal Requirements. Tenant shall cause, at its sole cost and
expense, all Alterations to comply with insurance requirements and with Legal
Requirements and shall implement at its sole cost and expense any Alteration or
modification required by Legal Requirements as a result of any Alterations.
Tenant shall pay to Landlord, as Additional Rent, on demand an amount equal to
2.5% of all charges up to $100,000, and 5% of all charges in excess of $100,000,
incurred by Tenant or its contractors or agents in connection with any
Alteration to cover Landlord's overhead and expenses for plan review,
coordination, scheduling and supervision. Before tenant begins any Alteration,
Landlord may post on and about the Premises notices of non-responsibility
pursuant to applicable law. Tenant shall reimburse Landlord for, and indemnify
and hold Landlord harmless from, any expense incurred, by Landlord by reason of
faulty work done by Tenant or its contractors, delays caused by such worK, or
inadequate cleanup.

         Tenant shall furnish security or make other arrangements satisfactory
to Landlord to assure payment for the completion of all Alterations work free
and clear of liens, and shall provide (and cause each contractor or
subcontractor to provide) certificates of insurance for workers' compensation
and other coverage in amounts and from an insurance company satisfactory to
Landlord protecting Landlord against liability for personal injury or property
damage during construction. Upon completion of any Alterations, Tenant shall
deliver to Landlord: (i) sworn statements setting forth the names of all
contractors and subcontractors who did the work and final lien waivers from all
such contractors and subcontractors; and (ii) "as built" plans for any such
Alteration.

         Other than (i) the items, if any, listed on EXHIBIT E and EXHIBIT F
attached hereto, (ii) any items agreed by Landlord in writing to be included on
EXHIBIT E in the future, and (iii) any trade fixtures, machinery, equipment and
other personal property which may be removed without material damage to the
Premises, which damage shall be repaired (including capping or terminating
utility hook-ups behind walls) by Tenant during the Term (collectively,
"TENANT'S PROPERTY"), all Alterations, real property fixtures, built-in
machinery and equipment, built-in casework and cabinets and other similar
additions and improvements built into the Premises so as to become an integral
part of the Premises such as fume hoods which penetrate the roof or plenum area,
built-in cold rooms, built-in warm rooms, walk-in cold rooms, walk-in warm
rooms, deionized water systems, glass washing equipment, autoclaves, chillers
built-in plumbing, electrical and mechanical equipment and systems, and any
power generator and transfer switch (collectively, "INSTALLATIONS") shall be and
shall remain the property of Landlord during the Term and following the
expiration or earlier termination of the Term, shall not be removed by Tenant at
any time during the Term and shall remain upon and be surrendered with the
Premises as a part thereof following the expiration or earlier termination of
this Lease; provided, however, that Landlord shall, at the time its approval of
such installation is requested or at the time it receives notice of a
Notice-Only Alteration, notify Tenant if it has elected to cause Tenant to
remove such Installation upon the expiration, or earlier termination of this
Lease. If Landlord so elects, Tenant shall remove such Installation upon the
expiration or earlier termination of this Lease and restore any damage caused by
or occasioned as a result of such removal, including, when removing any of
Tenant's Property which was plumbed, wired or otherwise connected to any of the
Building Systems, capping off all such connections behind the walls of the
Premises and repairing any holes. During any such restoration period, Tenant
shall pay Rent to Landlord as provided herein as if said space were otherwise
occupied by Tenant.

         Landlord shall pay up to $5,000 toward the cost of reinforcing the roof
if necessary in connection with Tenant's installation of two HEPA filtration
units, the installation of which shall be subject to the terms and conditions
of this Section 10, Tenant is hereby granted permission to install, in
accordance with the

              (C) ALL RIGHTS RESERVED 2001 ALEXANDRIA REAL ESTATE EQUITIES, INC.
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Short Form 3N Laboratory Lease              2625 HANOVER STREET/NANOSYS - PAGE 7

provisions of this Section 10, at Tenant's sole cost those items listed as
"Pre-Approved Alteration" on Exhibit F hereto, and shall not be required to
remove such items at the end of the Term, provided that at any time Tenant may
remove any "Pre-Approved Alterations" so long as Tenant repairs any damage
caused by such removal to the reasonable satisfaction of Landlord.

         11.      LANDLORD'S REPAIRS. Landlord, as an Operating Expense, shall
maintain all of the Project and the Premises in good repair, reasonable wear and
tear and uninsured losses and damages caused by Tenant, or by any of Tenant's
agents, servants, employees, invitees and contractors (collectively, "TENANT
PARTIES") excluded. Landlord shall repair losses and damages caused by Tenant or
any of Tenant Parties at Tenant's sole cost and expense. Landlord reserves the
right to stop Building system services when necessary. Landlord shall have no
responsibility or liability for failure to supply building system services
during any such period of interruption; provided, however, that Landlord shall
give Tenant 24 hours advance notice of any planned stoppage of building system
services for routine maintenance, repairs, alterations or improvements.
Landlord shall not be liable for any failure to make any repairs or to perform
any maintenance unless such failure shall persist for an unreasonable time (not
to exceed 30 days) after Tenant's written notice of the need for such repairs
or maintenance.

         12.      LIENS. Tenant shall discharge, by bond or otherwise, any liens
filed against the Premises or against the Project arising out of work performed
or claimed to have been performed on behalf of Tenant, materials furnished or
claimed to have been furnished to Tenant, or obligations incurred or claimed to
have been incurred by Tenant, within 10 days after Tenant receives notice of the
filing thereof, at Tenant's sole cost.

         13.      INDEMNIFICATION. Tenant hereby indemnifies and agrees to
defend, save and hold Landlord harmless from and against any and all claims for
injury or death to persons or damage to property occurring within or about the
Premises, arising directly or indirectly out of use or occupancy of the Premises
or a breach or default by Tenant in the performance of any of its obligations
hereunder, unless caused solely by the willful misconduct or gross negligence of
Landlord. Landlord shall not be liable to Tenant for, and Tenant assumes all
risk of damage to, personal property (including, without limitation, loss of
records kept within the Premises). Tenant further waives any and all claims for
injury to Tenant's business or loss of income relating to any such damage or
destruction of personal property (including, without limitation, any loss of
records). Landlord shall not be liable for any damages arising from any act,
omission or neglect of any tenant in the Project or of any other third party.

         14.      INSURANCE. Landlord shall, as an Operating Expense, maintain
such insurance covering the Project as Landlord shall determine, including "all
risk" property insurance covering the full replacement cost of the Project.
Tenant, at its sole cost and expense, shall maintain during the Term : workers'
compensation insurance with no less than the minimum limits required by law;
employer's liability insurance with such limits as required by law; commercial
general liability insurance, with a minimum limit of not less than $2,000,000
per occurrence for bodily injury and property damage with respect to the
Premises; and business interruption insurance covering not less than 12 months
of Tenant's liabilities. The commercial general liability insurance policies
maintained by Tenant shall name Landlord, its officers, directors, employees,
managers, agents, invitees and contractors (collectively "LANDLORD PARTIES"), as
additional insureds; insure on an occurrence and not a claims-made basis; be
issued by insurance companies which have a rating of not less than policyholder
rating of A and financial category rating of at least Class VII in "Best's
Insurance Guide"; shall not be cancelable for nonpayment of premium unless 30
days prior written notice shall have been given to Landlord from the insurer;
contain a hostile fire endorsement and a contractual liability endorsement; and
provide primary coverage to Landlord (any policy issued to Landlord providing
duplicate or similar coverage shall be deemed excess over Tenant's policies).
Copies of such policies (if requested by Landlord), or certificates of insurance
showing the limits of coverage required hereunder and showing Landlord as an
additional insured, along with reasonable evidence of the payment of premiums
for the applicable period, shall be delivered to Landlord by Tenant upon
commencement of the Term and with respect to any renewal of insurance ;policy.
no later than 5 days prior to the expiration of such policy. The property
insurance obtained by landlord and Tenant shall include a waiver of subrogation
by the insurers and all rights based upon an assignment from its insured,
against Landlord or Tenant, and their respective officers, directors.

              (C) ALL RIGHTS RESERVED 2001 ALEXANDRIA REAL ESTATE EQUITIES, INC.
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Short Form 3N Laboratory Lease              2625 HANOVER STREET/NANOSYS - PAGE 8

employees, managers, agents, invitees and contractors in connection with any
loss or damage thereby insured against, or required to be insured against
under this Lease.

         15.      CONDEMNATION AND CASUALTY. If at anytime during the Term the
Premises are in whole or in part (i) materially damaged or destroyed by a fire
or other casualty or (ii) taken for any public or quasi-public use under
governmental law, ordinance, or regulation, or by right of eminent domain, or by
private purchase in lieu thereof (a "TAKING"), this Lease shall, at the written
election of Landlord or Tenant, terminate as of the date of such damage,
destruction or Taking. Any statute or regulation which is now or may hereafter
be in effect shall have no application to this Lease or any such damage,
destruction or Taking, the parties hereto expressly agreeing that this Section
sets forth their entire understanding and agreement with respect to such
matters. Upon any fire or other casualty or Taking, Landlord shall be entitled
to receive the entire proceeds of the insurance maintained by Landlord and the
entire price or award from any such Taking without, in either case, any payment
to Tenant, and Tenant hereby assigns to Landlord Tenant's interest, if any, in
such proceeds or award. In the event of damage, destruction or a Taking which
does not result in a termination of this Lease, to the extent not covered by
Tenant's business interruption insurance required pursuant to Section 15 of this
Lease, Rent shall be equitably abated from the date all required hazardous
materials clearances are obtained until the Premises are repaired and restored,
in the proportion which the area of the Premises, if any, which is not usable by
Tenant bears to the total area of the Premises, unless Landlord provides Tenant
with other space during the period of repair that is suitable for the temporary
conduct of Tenant's business.

         16.      EVENTS OF DEFAULT. Each of the following events shall be a
default ("DEFAULT") by Tenant under this Lease:

         (a)      PAYMENT DEFAULTS. Tenant shall fail to pay any installment of
Rent or any other payment hereunder when due; provided that one time in any 12
consecutive month period during the Term, no Default shall occur unless Tenant's
failure to pay Rent or any other payment when due shall continue for a period of
5 business days after written notice of such failure to pay from Landlord.

         (b)      INSURANCE. Any insurance required to be maintained by Tenant
pursuant to this Lease shall be canceled or terminated or shall expire or shall
be reduced or materially changed, or Landlord shall receive a notice of
nonrenewal of any such insurance and Tenant shall fail to obtain replacement
insurance at least 20 days before the expiration of the current coverage.

         (c)      OTHER DEFAULTS. Tenant shall fail to comply with any provision
of this Lease other than those specifically referred to in this Section 16, and,
except as otherwise expressly provided herein, such failure shall continue for a
period of 30 days after written notice thereof from Landlord to Tenant, or, if
such failure to comply cannot reasonably be cured within such 30 day period,
then for such longer period as is reasonably necessary, provided that Tenant
commences to cure such Default within 30 days after written notice and
diligently pursues curing such Default.

Any notice given under Section 16(c) hereof shall: (i) specify the alleged
default, (ii) demand that Tenant cure such default, (iii) be in lieu of, and not
in addition to, or shall be deemed to be, any notice required under any
provision of applicable law, and (iv) not be deemed a forfeiture or a
termination of this Lease unless Landlord elects otherwise in such notice.
Notwithstanding subsection (iii) immediately above, any notice to quit after
default in the payment of Rent, as required by Section 1161 of the Code of Civil
Procedure, shall comply with all of the provisions of Section 1161.

         17.      LANDLORD'S REMEDIES.

         (a)      PAYMENT BY LANDLORD; INTEREST. Upon a Default by Tenant
hereunder, Landlord may without waiving or releasing any obligation of Tenant
hereunder, make such payment or perform such act All sums so paid or incurred by
Landlord, together with interest thereon, from the date such sums were paid or
incurred, at the annual rate equal to 12% per annum or the highest rate
permitted by law (the "DEFAULT RATE"), whichever is less, shall be payable to
Landlord on demand as Additional Rent. Nothing

              (C) ALL RIGHTS RESERVED 2001 ALEXANDRIA REAL ESTATE EQUITIES, INC.
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Short Form 3N Laboratory Lease              2625 HANOVER STREET/NANOSYS - PAGE 9

herein shall be construed to create or impose a duty on Landlord to mitigate any
damages resulting from Tenant's Default hereunder.

         (b)      LATE PAYMENT RENT. Late payment by Tenant to Landlord of Rent
and other sums due will cause Landlord to incur costs not contemplated by this
Lease, the exact amount of which will be extremely difficult and impracticable
to ascertain. Such costs include, but are not limited to, processing and
accounting charges and late charges which may be imposed on Landlord under any
Mortgage covering the Premises. Therefore, if any installment of Rent due from
Tenant is not received by Landlord within 5 days after the date such payment is
due, Tenant shall pay to Landlord an additional sum equal to 5% of the
delinquent amount as a late charge. The parties agree that this late charge
represents a fair and reasonable estimate of the costs Landlord will incur by
reason of late payment by Tenant. In addition to the late charge, Rent not paid
when due shall bear interest at the Default Rate from the 5th day after the date
due until paid.

         (c)      OTHER REMEDIES. Upon the occurrence of a Default, Landlord, at
its option, without further notice or demand to Tenant, shall have all rights
and remedies provided at law or in equity.

         18.      ASSIGNMENT AND SUBLETTING.

         (a)      GENERAL PROHIBITION. Tenant shall not, directly or indirectly,
voluntarily or by operation of law, assign this Lease or mortgage, pledge, or
hypothecate its leasehold interest or grant any concession or license within the
Premises, and any attempt to do any of the foregoing shall be void and of no
effect.

         (b)      PERMITTED SUBLEASES. If Tenant desires to sublease or sublet
the Premises, then at least 10 business days, but not more than 90 business
days, before the date Tenant desires the sublease to be effective (the "SUBLEASE
DATE"), Tenant shall give Landlord a notice (the "SUBLEASE NOTICE") containing
such information about the proposed sublessee, including the proposed use of the
Premises, business and financial information on the proposed sublessee, any
Hazardous Materials proposed to be used, stored handled, treated, generated in
or released or disposed of from the Premises, the Sublease Date, any
relationship between Tenant and the proposed sublessee, and all material terms
and conditions of the proposed sublease, including a copy of any proposed
sublease in its final form, and such other information as Landlord may deem
reasonably necessary or appropriate to its consideration whether to grant its
consent. Landlord may, by giving written notice to Tenant within 15 business
days after receipt of the Sublease Notice: (i) grant such consent, or (ii)
refuse such consent, in its reasonable discretion. No failure of Landlord to
deliver a timely notice in response to the Sublease Notice shall be deemed to be
Landlord's consent to the proposed sublease. Tenant shall reimburse Landlord for
up to $2,000 for Landlord's reasonable out-of-pocket expenses in connection with
its consideration of any Sublease Notice. Notwithstanding the foregoing, Tenant
may, without Landlord's consent, sublet or assign the Lease to (a) an entity
controlling, controlled by or under common control with Tenant, (b) a successor
entity resulting from a merger with or acquisition of Tenant, or (c) a purchaser
of substantially all of Tenant's assets. The public offering or public trading
of Tenant's capital stock shall not be deemed to be an assignment or subletting
of this Lease. Institutional or venture financing by Tenant to raise additional
contributed capital shall not be deemed to be an assignment or subletting of
this Lease.

         (c)      ADDITIONAL CONDITIONS. As a condition to any such subletting,
whether or not Landlord's consent is required, Landlord may require:

                           (i)      that any sublessee agree, in writing at the
time of such subletting, that if Landlord gives such party notice that Tenant is
in default under this Lease beyond any applicable notice and cure period, such
party shall thereafter make all payments otherwise due Tenant directly to
Landlord, which payments will be received by Landlord without any liability
except to credit such payment against those due under the Lease, and any such
third party shall agree to attorn to Landlord or its successors and assigns
should this Lease be terminated for any reason; provided, however, in no event
shall Landlord or its successors or assigns be obligated to accept such
attornment; and

              (C) ALL RIGHTS RESERVED 2001 ALEXANDRIA REAL ESTATE EQUITIES, INC.
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Short Form 3N Laboratory Lease             2625 HANOVER STREET/NANOSYS - PAGE 10

                           (ii)     A list of Hazardous Materials, certified by
the proposed sublessee to be true and correct, which the proposed sublessee
intends to use, store, handle, treat, generate in or release or dispose of from
the Premises, together with copies of all documents relating to such use,
storage, handling, treatment, generation, release or disposal of Hazardous
Materials by the proposed subtenant in the Premises or on the Project, prior to
the proposed subletting, including, without limitation, permits; approvals;
reports and correspondence; storage and management plans; plans relating to the
installation of any storage tanks to be installed in or under the Project
(provided, said installation of tanks shall only be permitted after Landlord has
given its written consent to do so, which consent may be withheld in Landlord's
sole and absolute discretion); and all closure plans or any other documents
required by any and all federal, state and local governmental authorities for
any storage tanks installed in, on or under the Project for the closure of any
such tanks. Neither Tenant nor any such proposed subtenant is required, however,
to provide Landlord with any portion(s) of the such documents containing
information of a proprietary nature which, in and of themselves, do not
contain a reference to any Hazardous Materials or hazardous activities.

         (d)      NO RELEASE OF TENANT, SHARING OF EXCESS RENTS. Notwithstanding
any subletting, Tenant shall at all times remain fully and primarily responsible
and liable for the payment of Rent and for compliance with all of Tenant's other
obligations under this Lease. If the Rent due and payable by a sublessee (or a
combination of the rental payable under such sublease plus any bonus or other
consideration therefor or incident thereto in any form) exceeds the rental
payable under this Lease, (excluding however, any Rent payable under this
Section), then Tenant shall be bound and obligated to pay Landlord as Additional
Rent hereunder 50% of such excess rent, after deducting Tenant's actual costs of
brokerage commissions, reasonable attorneys' fees and remodeling the Premises in
connection with such sublease, within 10 days following receipt thereof by
Tenant. If Tenant shall sublet the Premises or any part thereof, Tenant hereby
immediately and irrevocably assigns to Landlord, as security for Tenant's
obligations under this Lease, all rent from any such subletting, and Landlord as
assignee and as attorney-in-fact for Tenant, or a receiver for Tenant appointed
on Landlord's application, may collect such rent and apply it toward Tenant's
obligations under this Lease; except that, until the occurrence of a Default,
Tenant shall have the right to collect such rent. Under no circumstances shall
Tenant permit any subtenant or assignee to change the laboratory use of any
portion of the Premises.

         (e)      NO WAIVER. The consent by Landlord to a subletting shall not
relieve Tenant or any sublessees of the Premises from obtaining the consent of
Landlord to any further subletting nor shall it release Tenant or sublessee of
Tenant from full and primary liability under the Lease. The acceptance of Rent
hereunder, or the acceptance of performance of any other term, covenant, or
condition thereof, from any other person or entity shall not be deemed to be a
waiver of any of the provisions of this Lease or a consent to any subletting,
assignment or other transfer of the Premises.

         (f)      PRIOR CONDUCT OF PROPOSED TRANSFEREE. Notwithstanding any
other provision of this Section 18, if (i) the proposed sublessee of Tenant has
been required by any prior landlord, lender or governmental authority to take
remedial action in connection with Hazardous Materials contaminating a
property, where the contamination resulted from such party's action or use of
the property in question, (ii) the-proposed sublessee is subject to an
enforcement order issued by any governmental authority in connection with the
use, storage, handling, treatment, generation, release or disposal of Hazardous
Materials (including, without limitation, any order related to the failure to
make a required reporting to any governmental authority), or (iii) because of
the existence of a pre-existing environmental condition in the vicinity of or
underlying the Project, the risk that Landlord would be targeted as a
responsible party in connection with the remediation of such pre-existing
environmental condition would be materially increased or exacerbated by the
proposed use of Hazardous Materials by such proposed sublessee, Landlord shall
have the absolute right to refuse to consent to any subletting to any such
party.

         19.      ESTOPPEL CERTIFICATE. Tenant shall, within 10 business days of
written notice from Landlord, execute, acknowledge and deliver an estoppel
certificate on any form reasonably requested by a proposed lender or purchaser.

              (C) ALL RIGHTS RESERVED 2001 ALEXANDRIA REAL ESTATE EQUITIES, INC.
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Short Form 3N Laboratory Lease             2625 HANOVER STREET/NANOSYS - PAGE 11

         20.      QUIET ENJOYMENT. So long as Tenant shall perform all of the
covenants and agreements herein required to be performed by Tenant within
applicable notice and cure periods, Tenant shall, subject to the terms of this
Lease, at all times during the Term, have peaceful and quiet enjoyment of the
Premises against any person claiming by, through or under Landlord.

         21.      PRORATIONS. All prorations required or permitted to be made
hereunder shall be made on the basis of a 360 day year and 30 day months.

         22.      RULES AND REGULATIONS. Tenant shall, at all times during the
Term and any extension thereof, comply with all reasonable rules and regulations
at any time or from time to time established by Landlord covering use of the
Premises and the Project. The current rules and regulations are attached
hereto as EXHIBIT C. If there is any conflict between said rules and regulations
and other provisions of this Lease, the terms and provisions of this Lease shall
control. Landlord shall not have any liability or obligation for the breach of
any rules or regulations by other tenants in the Project and shall not enforce
such rules and regulations in a discriminatory manner.

         23.      SUBORDINATION. This Lease and Tenant's interest and rights
hereunder are and shall be subject and subordinate at all times to the lien of
any Mortgage now existing or hereafter created on or against the Project or the
Premises, and all amendments, restatements, renewals, modifications,
consolidations, refinancing, assignments and extensions thereof, without the
necessity of any further instrument or act on the part of Tenant. Tenant agrees,
at the election of the Holder of any such Mortgage, to attorn to any such
Holder. Tenant agrees upon demand to execute, acknowledge and deliver such
instruments confirming such subordination and/or attornment as shall be
requested by any such Holder.

         24.      SURRENDER. Upon the expiration of the Term or earlier
termination of Tenant's right of possession, Tenant shall surrender the Premises
to Landlord in substantially the same condition as received, after removing any
material quantities of Hazardous Materials brought upon, kept, used, stored,
handled, treated, generated in, or released or disposed of from, the Premises by
any person other than a Landlord Party (collectively, "TENANT HAZMAT
OPERATIONS") and released of all Hazardous Materials clearances, disinfected and
cleaned in accordance with prudent industry practices, and eliminating any
contamination of Hazardous Materials in excess of any residual amounts shown in
the Commencement Date HazMat Condition Report (as defined in Section 26(d)
below), broom clean, with ordinary wear and tear and casualty loss and
condemnation covered by Section 15 excepted. At least 2 months prior to the
surrender of the Premises, Tenant shall deliver to Landlord a narrative
description of the actions proposed (or required by any governmental authority)
to be taken by Tenant in order to surrender the Premises at the expiration or
earlier termination of the Term, free from material residual impact from the
Tenant HazMat Operations and otherwise released for unrestricted use and
occupancy (the "SURRENDER PLAN"). Such Surrender Plan shall be accompanied by a
listing of (i) all Hazardous Materials licenses and permits held by or on behalf
of any Tenant Party with respect to the Premises, and (ii) all Hazardous
Materials used, stored, handled, treated, generated, released or disposed of
from the Premises, and shall be subject to the review and approval of Landlord's
environmental consultant. In connection with the review and approval of the
Surrender Plan, upon the request of Landlord, Tenant shall deliver to Landlord
or its consultant such additional non-proprietary information concerning Tenant
HazMat Operations as Landlord shall request. On or before such surrender, Tenant
shall deliver to Landlord evidence that the approved Surrender Plan shall have
been satisfactorily completed and Landlord shall have the right, subject to
reimbursement at Tenant's expense as set forth below, to cause Landlord's
environmental consultant to inspect the Premises and perform such additional
procedures as may be deemed Reasonably necessary to confirm that the Premises
are, as of the effective date of such surrender or early termination of the
Lease, free from any residual impact from Tenant HazMat Operations. Tenant shall
reimburse Landlord, as Additional Rent, for the actual out-of pocket expense
incurred by Landlord for Landlord's environmental consultant to review and
approve the Surrender Plan and to visit the Premises and verify satisfactory
completion of the same, which cost shall not exceed $1,500. Landlord shall have
the unrestricted right to deliver such Surrender Plan and any report by
Landlord's environmental consultant with respect to the surrender of the
Premises to third parties.

              (C) ALL RIGHTS RESERVED 2001 ALEXANDRIA REAL ESTATE EQUITIES, INC.
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Short Form 3N Laboratory Lease             2625 HANOVER STREET/NANOSYS - PAGE 12

         If Tenant shall fail to prepare or submit a Surrender Plan approved by
Landlord, or if Tenant shall fail to complete the approved Surrender Plan, or if
such Surrender Plan, whether or not approved by Landlord, shall fail to
adequately address material residual effect of Tenant HazMat Operations in, on
or about the Premises, Landlord shall have the right to take such actions as
Landlord may deem reasonable or appropriate to assure that the Premises and the
Project are surrendered free from any residual impact from Tenant HazMat
Operations, the reasonable cost of which actions which is actually incurred
shall be reimbursed by Tenant as Additional Rent, without regard to the
limitation set forth in the first paragraph of this Section 28.

         Tenant shall immediately return to Landlord all keys and/or access
cards to parking, the Project, restrooms or all or any portion of the Premises
furnished to or otherwise procured by Tenant. If any such access card or key is
lost, Tenant shall pay to Landlord, at Landlord's election, either the cost of
replacing such lost access card or key or the cost of reprogramming the access
security system in which such access card was used or changing the lock or locks
opened by such lost key. Any Tenant's property not so removed by Tenant as
permitted or required herein shall be deemed abandoned and may be stored,
removed, and disposed of by Landlord at Tenant's expense, and Tenant waives all
claims against Landlord for any damages resulting from Landlord's retention
and/or disposition of such property. All Obligations of Tenant hereunder not
fully performed as of the termination of the Term, including the obligations of
Tenant under Section 26 hereof, shall survive the expiration or earlier
termination of the Term, including, without limitation, indemnity obligations,
payment obligations with respect to Rent and obligations concerning the
condition and repair of the Premises.

         25.      WAIVER OF JURY TRIAL. TENANT AND LANDLORD WAIVE ANY RIGHT TO
TRIAL BY JURY OR TO HAVE A JURY PARTICIPATE IN RESOLVING ANY DISPUTE, WHETHER
SOUNDING IN CONTRACT, TORT, OR OTHERWISE, BETWEEN LANDLORD AND TENANT ARISING
OUT OF THIS LEASE OR ANY OTHER INSTRUMENT, DOCUMENT, OR AGREEMENT EXECUTED OR
DELIVERED IN CONNECTION HEREWITH OR THE TRANSACTIONS RELATED HERETO.

         26.      ENVIRONMENTAL REQUIREMENTS.

         (a)      PROHIBITION/COMPLIANCE/INDEMNITY. Tenant shall not cause or
permit any Hazardous Materials (as hereinafter defined) to be brought upon,
kept, used, stored, handled, treated, generated in or about, or released or
disposed of from, the Premises or the Project in violation of applicable
Environmental Requirements (as hereinafter defined) by Tenant or any Tenant
Party. If (i) Tenant breaches the obligation stated in the preceding sentence,
(ii) if the presence of Hazardous Materials in the Premises during the Term or
any holding over results in contamination of the Premises, the Project or any
adjacent property above any residual levels of contamination shown on the
Commencement Date HazMat Condition Report (as defined in Section 26(e) below),
or (iii) if contamination of the Premises, the Project or any adjacent property
by Hazardous Materials brought into, kept, used, stored, handled, treated,
generated in or about, or released or disposed of from, the Premises by anyone
other than Landlord and Landlord's employees, agents and contractors otherwise
occurs during the Term or any holding over, Tenant hereby indemnifies and shall
defend and hold Landlord, its officers, directors, employees, agents and
contractors harmless from any and all actions (including, without limitation,
remedial or enforcement actions of any kind, administrative or judicial
proceedings, and orders or judgments arising out of or resulting therefrom),
costs, claims, damages (including, without limitation punitive damages and
damages based upon diminution in value of the Premises or the Project, or the
loss of, or restriction on, use of the Premises or any portion of the Project),
expenses (including, without limitation, attorneys', consultants' and experts'
fees, court costs and amounts paid in settlement of any claims or actions),
fines, forfeitures or other civil, administrative or criminal penalties,
injunctive or other relief (whether or not based upon personal injury, property
damage, or contamination of, or adverse effects upon, the environment, water
tables or natural resources), liabilities or losses (collectively,
"ENVIRONMENTAL CLAIMS") which arise during or after the Term as a result of such
breach or contamination. This indemnification of Landlord by Tenant includes,
without limitation, costs incurred in connection with any investigation of site
conditions or any cleanup, treatment, remedial, removal, or restoration work
required by any federal, state or local governmental authority because of an
alleged violation of Tenant's obligations under this Section 26(a). Without
limiting the foregoing, if the presence

              (C) ALL RIGHTS RESERVED 2001 ALEXANDRIA REAL ESTATE EQUITIES, INC.
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<PAGE>

Short Form 3N Laboratory Lease             2625 HANOVER STREET/NANOSYS - PAGE 13

of any Hazardous Materials on the Premises caused or permitted by Tenant or any
Tenant Party, or the presence of Hazardous Materials on the Project outside of
the Premises or any adjacent property actually caused by Tenant or any Tenant
Party, results in any contamination of the Premises, the Project or any adjacent
property, as applicable, Tenant shall promptly take all actions at its sole
expense and in accordance with applicable Environmental Requirements as are
necessary to return the Premises, the Project or any adjacent property to the
condition existing prior to the time of such contamination, provided that
Landlord's approval of such action shall first be obtained, which approval shall
not unreasonably be withheld so long as such actions would not potentially have
any material adverse long-term or short-term effect on the Premises or the
Project.

         (b)      BUSINESS. As a material inducement to Landlord to allow Tenant
to use Hazardous Materials in connection with its business, Tenant agrees to
deliver to Landlord prior to the Commencement Date a list identifying each type
of Hazardous Materials to be brought upon, kept, used, stored, handled, treated,
generated on, or released or disposed of from, the Premises and setting forth
any and all governmental approvals or permits required in connection with the
presence, use, storage, handling, treatment, generation, release or disposal of
such Hazardous Materials on or from the Premises ("HAZARDOUS MATERIALS LIST").
Within a reasonable period after Landlord's request, Tenant shall deliver to
Landlord an updated Hazardous Materials List at least once each year and shall
also deliver an updated list before any new Hazardous Material is brought onto,
kept, used, stored, handled, treated, generated on, or released or disposed of
from, the Premises. Tenant shall deliver to Landlord true and correct copies of
the following documents (the "HAZ MAT DOCUMENTS") relating to the use, storage,
handling, treatment, generation, release or disposal of Hazardous Materials
prior to the Commencement Date, or if unavailable at that time, concurrent with
the receipt from or submission to a governmental authority; permits; approvals;
reports and correspondence; storage and management plans; and notices of
violations of any Legal Requirements.

         (c)      TENANT'S OBLIGATIONS. Tenant's obligations under this Section
26 shall survive the expiration or earlier termination of the Lease for one
year. During any period of time after the expiration or earlier termination of
this Lease required by Tenant or Landlord to complete the removal from the
Premises of any Hazardous Materials (including, without limitation, the release
and termination of any licenses or permits restricting the use of the Premises
and the completion of the approved Surrender Plan), Tenant shall continue to pay
the full Rent in accordance with this Lease for any portion of the Premises not
relet by Landlord in Landlord's sole discretion, which Rent shall be prorated
daily.

         (d)      DEFINITIONS. As used herein, the term "ENVIRONMENTAL
REQUIREMENTS" means all applicable present and future statutes, regulations,
ordinances, rules, codes, judgments, orders or other similar enactments of any
governmental authority regulating or relating to health, safety, or
environmental conditions on, under, or. about the Premises or the Project, or
the environment, including without limitation, the following: the Comprehensive
Environmental Response, Compensation and Liability Act; the Resource
Conservation and Recovery Act; and all state and local counterparts thereto, and
any regulations or policies promulgated or issued thereunder. As used herein,
the term "HAZARDOUS MATERIALS" means and includes any substance, material,
waste, pollutant, or contaminant listed or defined as hazardous or toxic, or
regulated by reason of its impact or potential impact on humans, animals and/or
the environment under any Environmental Requirements, asbestos and petroleum,
including crude oil or any fraction thereof, natural gas liquids, liquefied
natural gas, or synthetic gas usable for fuel (or mixtures of natural gas and
such synthetic gas). As defined in Environmental Requirements, Tenant is and
shall be deemed to be the "OPERATOR" of Tenant's "FACILITY" and the "OWNER" of
all Hazardous Materials brought on the Premises by Tenant or any Tenant Party,
and the wastes, by-products, or residues generated, resulting, or produced
therefrom.

         (e)      CONDITION OF THE PREMISES. On the condition that Tenant shall
execute and deliver an agreement to maintain the confidentiality of such
reports, Landlord shall deliver to Tenant complete copies of the reports in
Landlord's possession or under Landlord's control of all third party consultants
who have prepared reports containing any information on the compliance of the
Project with Environmental Requirements and the presence of any Hazardous
Materials on or about the Project Such reports shall include a report, in
reasonable detail, showing the condition of the Premises, and the

              (C) ALL RIGHTS RESERVED 2001 ALEXANDRIA REAL ESTATE EQUITIES, INC.
                                                      CONFIDENTIAL - DO NOT COPY

<PAGE>

Short Form 3N Laboratory Lease             2625 HANOVER STREET/NANOSYS - PAGE 14

presence of any Hazardous Materials thereon, at or around the Commencement Date
(the "COMMENCEMENT DATE HAZMAT CONDITION REPORT"). In addition, Landlord shall
provide Tenant with reasonable evidence of the proper decommissioning of the
Premises by the current tenant in possession.

         27.      TENANT'S REMEDIES/LIMITATION OF LIABILITY. Landlord shall not
be in default hereunder unless Landlord fails to perform any of its obligations
hereunder within 30 days after written notice from Tenant specifying such
failure. TENANT'S SOLE REMEDY FOR ANY BREACH OR DEFAULT BY LANDLORD HEREUNDER
SHALL BE TO TERMINATE THE LEASE AND TENANT HEREBY, TO THE MAXIMUM EXTENT
POSSIBLE, KNOWINGLY WAIVES (i) THE PROVISIONS OF ANY LAW, NOW OR HEREAFTER IN
FORCE WHICH PROVIDE ADDITIONAL OR OTHER REMEDIES TO TENANT AS A RESULT OF ANY
BREACH BY LANDLORD HEREUNDER OR UNDER ANY SUCH LAW OR REGULATION.

         28.      INSPECTION AND ACCESS. Landlord and its agents,
representatives, and contractors may enter the Premises at any reasonable time
upon 24 hours advance notice to inspect the Premises and to make such repairs as
may be required or permitted pursuant to this Lease, to perform such
environmental tests as may be reasonably required to confirm Tenant's compliance
with the terms hereof and for any other business purpose. Landlord and
Landlord's representatives may enter the Premises during business hours on not
less than 24 hours advance written notice (except in the case of emergencies in
which case no such notice shall be required and such entry may be at any time)
for the purpose of effecting any such repairs, inspecting the Premises, showing
the Premises to prospective purchasers and, during the last 3 months of the
Term, to prospective tenants, or for any other business purpose.

         29.      SECURITY. Tenant acknowledges and agrees that security devices
and services, if any, while intended to deter crime may not in given instances
prevent theft or other criminal acts and that Landlord is not providing any
security services with respect to the Premises. Tenant agrees that Landlord
shall not be liable to Tenant for, and Tenant waives any claim against Landlord
with respect to, any loss by theft or any other damage suffered or incurred by
Tenant in connection with any unauthorized entry into the Premises or any other
breach of security with respect to the Premises. Tenant shall be solely
responsible for the personal safety of Tenant's officers, employees, agents,
contractors, guests and invitees while any such person is in, on or about the
Premises and/or the Project. Tenant shall at Tenant's cost obtain insurance
coverage to the extent Tenant desires protection against such criminal acts.

         30.      BROKERS, ENTIRE AGREEMENT, AMENDMENT. Landlord and Tenant each
represents and warrants that it has not dealt with any broker, agent or other
person (collectively, "BROKER) in connection with this transaction and that no
Broker brought about this transaction other than Cornish & Carey Commercial.
Landlord and Tenant each hereby agree to indemnify and hold the other harmless
from and against any claims by any Broker, other than the broker, if any named
in this Section 30, claiming a commission or other form of compensation by
virtue of having dealt with Tenant or Landlord, as applicable, with regard to
this leasing transaction.

         31.      LIMITATION ON LANDLORD'S LIABILITY. NOTWITHSTANDING ANYTHING
SET FORTH HEREIN OR IN ANY OTHER AGREEMENT BETWEEN LANDLORD AND TENANT TO THE
CONTRARY: (A) LANDLORD SHALL NOT BE LIABLE TO TENANT OR ANY OTHER PERSON FOR
(AND TENANT AND EACH SUCH OTHER PERSON ASSUME ALL RISK OF) LOSS, DAMAGE OR
INJURY, WHETHER ACTUAL OR CONSEQUENTIAL TO: TENANT'S PERSONAL PROPERTY OF EVERY
KIND AND DESCRIPTION, INCLUDING, WITHOUT LIMITATION TRADE FIXTURES, EQUIPMENT,
INVENTORY, SCIENTIFIC RESEARCH, SCIENTIFIC EXPERIMENTS, LABORATORY ANIMALS,
PRODUCT, SPECIMENS, SAMPLES, AND/OR SCIENTIFIC, BUSINESS, ACCOUNTING AND OTHER
RECORDS OF EVERY KIND AND DESCRIPTION KEPT AT THE PREMISES AND ANY AND ALL
INCOME DERIVED OR DERIVABLE THEREFROM; (B) THERE SHALL BE NO PERSONAL RECOURSE
TO LANDLORD FOR ANY ACT OR OCCURRENCE IN, ON OR ABOUT THE PREMISES OR ARISING IN
ANY WAY UNDER THIS LEASE OR ANY OTHER AGREEMENT BETWEEN LANDLORD AND TENANT WITH
RESPECT TO THE SUBJECT MATTER HEREOF AND ANY

              (C) ALL RIGHTS RESERVED 2001 ALEXANDRIA REAL ESTATE EQUITIES, INC.
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<PAGE>

Short Form 3N Laboratory Lease             2625 HANOVER STREET/NANOSYS - PAGE 15

LIABILITY OF LANDLORD HEREUNDER SHALL BE STRICTLY LIMITED SOLELY TO LANDLORD'S
INTEREST IN THE PROJECT OR ANY PROCEEDS FROM SALE OR CONDEMNATION THEREOF AND
ANY INSURANCE PROCEEDS PAYABLE IN RESPECT OF LANDLORD'S INTEREST IN THE PROJECT
OR IN CONNECTION WITH ANY SUCH LOSS; AND (C) IN NO EVENT SHALL ANY PERSONAL
LIABILITY BE ASSERTED AGAINST LANDLORD IN CONNECTION WITH THIS LEASE NOR SHALL
ANY RECOURSE BE HAD TO ANY OTHER PROPERTY OR ASSETS OF LANDLORD OR ANY OF
LANDLORD'S OFFICERS, DIRECTORS, EMPLOYEES, AGENTS OR CONTRACTORS. UNDER NO
CIRCUMSTANCES SHALL LANDLORD OR ANY OF LANDLORD'S OFFICERS, DIRECTORS,
EMPLOYEES, AGENTS OR CONTRACTORS BE LIABLE FOR INJURY TO TENANT'S BUSINESS OR
FOR ANY LOSS OF INCOME OR PROFIT THEREFROM.

         32.      SEVERABILITY. If any clause or provision of this Lease is
illegal, invalid or unenforceable under present or future laws, then and in that
event, it is the intention of the parties hereto that the remainder of this
Lease shall not be affected thereby.

         33.      SIGNS; EXTERIOR APPEARANCE. Tenant shall not: (i) attach
anything at any time to any outside wall of the Project, (ii) use any window
coverings or sunscreen other than Landlord's standard window coverings, (iii)
place any articles on the window sills, (iv) place any items on any exterior
balcony, or (v) paint, affix or exhibit any signs or any kind in the Premises
which can be viewed from the exterior of the Premises, Tenant shall be entitled
to Building standard lobby signage and directional signage at no cost to Tenant.

         34.      INTENTIONALLY OMITTED.

         35.      MISCELLANEOUS.

         (a)      NOTICES. Except as otherwise provided herein, all notices or
other communications between the parties shall be in writing and shall be deemed
duly given upon delivery or refusal to accept delivery by the addressee
thereof if delivered in person, confirmed receipt by facsimile or upon actual
receipt if delivered by reputable overnight guaranty courier, addressed and sent
to the parties at their addresses set forth above. Landlord and Tenant may from
time to time by written notice to the other designate another address for
receipt of future notices.

         (b)      RECORDATION. Neither this Lease nor a memorandum of lease
shall be filed by or on behalf of Tenant in any public record. Landlord may
prepare and file, and upon request by Landlord Tenant will execute, a memorandum
of lease.

         (c)      FINANCIAL INFORMATION. Tenant shall furnish Landlord with true
and complete copies of (i) Tenant's most recent audited annual financial
statements within 90 days of the end of each of Tenant's fiscal years during the
Term, (ii) Tenant's most recent unaudited quarterly financial statements within
45 days of the end of each of Tenant's first three fiscal quarters of each of
Tenant's fiscal years during the Term, (iii) at Landlord's request from time to
time, updated business plans, including cash flow projections and/or pro forma
balance sheets and income statements, all of which shall be treated by Landlord
as confidential information belonging to Tenant, (iv) corporate brochures and/or
profiles prepared by Tenant for prospective investors, and (v) any other
financial information or summaries that Tenant typically provides to its lenders
or shareholders. Landlord shall execute and deliver a reasonable agreement to
maintain the confidentiality of any information prior to receipt of such
information from Tenant.

         (d)      INTERPRETATION. The normal rule of construction to the effect
that any ambiguities are to be resolved against the drafting party shall not be
employed in the interpretation of this Lease or any exhibits or amendments
hereto.

         (e)      NOT BINDING UNTIL EXECUTED. The submission by Landlord to
Tenant of this Lease shall have no binding force or effect, shall not constitute
an option for the leasing of the Premises, nor confer any right or impose any
obligations upon either party until execution of this Lease by both parties.

              (C) ALL RIGHTS RESERVED 2001 ALEXANDRIA REAL ESTATE EQUITIES, INC.
                                                      CONFIDENTIAL - DO NOT COPY

<PAGE>

Short Form 3N Laboratory Lease             2625 HANOVER STREET/NANOSYS - PAGE 16

         (f)      LIMITATIONS ON INTEREST. It is expressly the intent of
Landlord and Tenant at all times to comply with applicable law governing the
maximum rate or amount of any interest payable on or in connection with this
Lease. If applicable law is ever judicially interpreted so as to render usurious
any interest called for under this Lease, or contracted for, charged, taken,
reserved, or received with respect to this Lease, then it is Landlord's and
Tenant's express intent that all excess amounts theretofore collected by
Landlord be credited on the applicable obligation (or, if the obligation has
been or would thereby be paid in full, refunded to Tenant), and the provisions
of this Lease immediately shall be deemed reformed and the amounts thereafter
collectible hereunder reduced, without the necessity of the execution of any new
document, so as to comply with the applicable law, but so as to permit the
recovery of the fullest amount otherwise called for hereunder.

         (g)      CHOICE OF LAW. Construction and interpretation of this Lease
shall be governed by the internal laws of the state in which the Premises are
located, excluding any principles of conflicts of laws.

         (h)      TIME. Time is of the essence as to the performance of Tenant's
obligations under this Lease.

         (i)      REASONABLE EXPENDITURES. Except for specific provisions of
this Lease relating to the obligations of either party to reimburse the other,
including but not limited to the provisions relating to Operating Expenses, no
party shall be entitled to reimbursement for any expenditure in an unreasonable
amount therefor.

              (C) ALL RIGHTS RESERVED 2001 ALEXANDRIA REAL ESTATE EQUITIES, INC.
                                                      CONFIDENTIAL - DO NOT COPY

<PAGE>

Short Form 3N Laboratory Lease             2625 HANOVER STREET/NANOSYS - PAGE 17

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

                                     TENANT:

                                     NANOSYS, INC.
                                     a Delaware corporation

                                     By: /s/ Calvin Chow
                                        ----------------------------------------
                                     Its: COO

                                     LANDLORD:

                                     ARE-2625/2627/2631 HANOVER, LLC,
                                     a Delaware limited liability company

                                     By:  ALEXANDRIA REAL ESTATE EQUITIES, L.P.,
                                          a Delaware limited partnership,
                                          managing member

                                          By:    ARE-QRS CORP.,
                                                 a Maryland corporation,
                                                 general partner

                                                 By: /s/ Joel Marcus
                                                    ----------------------------
                                                 Its : CEO

              (C) ALL RIGHTS RESERVED 2001 ALEXANDRIA REAL ESTATE EQUITIES, INC.
                                                      CONFIDENTIAL - DO NOT COPY

<PAGE>

Short Form 3N Laboratory Lease              2625 HANOVER STREET/NANOSYS - PAGE 1

                               EXHIBIT A TO LEASE

                             DESCRIPTION OF PREMISES

                                   [Attached]

              (C) ALL RIGHTS RESERVED 2001 ALEXANDRIA REAL ESTATE EQUITIES, INC.
                                                      CONFIDENTIAL - DO NOT COPY

<PAGE>

                                  [FLOOR PLAN]

                                 2625 HANOVER ST.
                                      STORY

<PAGE>

Short Form 3N Laboratory Lease              2625 HANOVER STREET/NANOSYS - PAGE 1

                               EXHIBIT B TO LEASE

                             DESCRIPTION OF PROJECT

                                   [Attached]

              (C) ALL RIGHTS RESERVED 2001 ALEXANDRIA REAL ESTATE EQUITIES, INC.
                                                      CONFIDENTIAL - DO NOT COPY

<PAGE>

Real Property in the Palo Alto, County of Santa Clara, State of California,
described as follows:

Parcel One:

Beginning at a concrete highway monument set on the Southwesterly line of E1
Camino Real opposite Engineer's Station 144+27.00, as surveyed by the California
Division of Highways, as said line was established by Decree of Condemnation
recorded July 7, 1930 in book 520, page 571, Official Records, at the point of
intersection of said line with the Southeasterly line of the 1289-acre tract of
land described in the deed from Evelyn C. Crosby et al to Leland Stanford dated
September 8, 1885 and recorded in Book 80 of Deeds, page 382, Santa Clara County
Records; thence North 58(degrees) 39' West along said line of E1 Camino Real,
2784.83 feet; thence South 33(degrees) 21' West 2175.49 feet to the true point
of beginning. Thence, from said true point of beginning, South 56(degrees) 26'
7" East 240.53 feet, thence South 33(degrees) 38' 20" West 323.08 feet to a
point on the Northeasterly line of Hanover Street, established by Easement Deed
to the City of Palo Alto recorded November 14, 1956 in Book 3656, page 424,
Official Records; thence North 56(degrees) 23' 40" West along said Northeasterly
line of Hanover Street, 268.32 feet; thence North 33(degrees) 38' 20" East
322.80 feet; thence South 56(degrees) 26' 07" East 27.79 feet to the true point
of beginning.

APN: 142-20-056
ARB: 142-20-56

Parcel Two:

BEGINNING at a concrete highway monument set on the Southwesterly line of E1
Camino Real opposite Engineer's Station 144+27.00, as surveyed by the California
Division of Highways, as said line was established by Decree of Condemnation
recorded July 7, 1930 in Book 520, page 571, Official Records, at the point of
intersection of said line with the Southeasterly line of the 1289-acre tract of
land described in the deed from Evelyn C. Crosby et al to Leland Stanford dated
September 8, 1885 and recorded in Book 80 of Deeds, page, 382, Santa Clara
County Records; thence North 58(degrees) 39' West along said line of E1 Camino
Real, 2784.83 feet; thence South 33(degrees) 21' West 2175.49 feet; thence North
56(degrees) 39' West 257.79 feet to the true point of beginning.

Thence, from said true point of beginning, South 33(degrees) 36' 20" West 321.76
feet to a point on the Northeasterly line of Hanover Street, as proposed to be
established, 60.00 feet in width; thence North 56(degrees) 23' 40" West along
said proposed Northeasterly line of Hanover Street, 367.67 feet; thence on the
arc of a curve to the right, with a radius of 20.00 feet, through a central
angle of 90(degrees) 00', a distance of 31.42 feet to a point in the
Southeasterly line of California Avenue (66 feet in width); thence North
33(degrees) 36' 20" East along said Southeasterly line, 299.94 feet to an iron
pipe which bears North 56(degrees) 39' West from the true point of beginning;
thence South 56(degrees) 39' East 407.57 feet to the true point of beginning.

APN: 142-20-005
ARB: 142-20-5

<PAGE>

Parcel Three:

BEGINNING at a point on the Northeasterly line of Hanover Street, 60.00 feet in
width, established by Easement Deed to the City of Palo Alto recorded November
14, 1958 in Book 3556, page 424, Official Records, at the Southernmost corner of
the 3.00-acre tract of land described in Memorandum of Lease by and between The
Board of Trustees of The Leland Stanford Junior University and Palo Alto Clinic.
Ltd. recorded January 18, 1957 in Book 3710, page 6, Official Records; thence
from said point of beginning North 33(degrees) 36' 20" East along the
Southeasterly line of said 3.00-acre tract, 321.76 feet to the Easternmost
corner thereof on the Southwesterly line of the 5.479-acre tract of land
described in the Memorandum of Lease by and between The Board of Trustees of The
Leland Stanford Junior University and Beckman Instruments, Inc. recorded January
11, 1956 in Book 3384, page 14, Official Records; thence South 56(degrees) 39'
East along said last named line, 230.00 feet to a point distant thereon North
56(degrees) 39' West 27.79 feet, from the Southernmost corner of said
5.479-acre tract; thence South 33(degrees) 36' 20" West 322.80 feat to a point
on the said Northeasterly line of Hanover Street: thence North 56(degrees) 23'
40" West along said Northeasterly line 230.00 feet to the point of beginning.

APN: 142-20-004
ARB: 142-20-4

<PAGE>

Short Form 3N Laboratory Lease              2625 HANOVER STREET/NANOSYS - PAGE 1

                               EXHIBIT C TO LEASE

                              Rules and Regulations

         1.       The sidewalk, entries, and driveways of the Project shall not
be obstructed by Tenant, or any Tenant Party, or used by them for any purpose
other than ingress and egress to and from the Premises.

         2.       Tenant shall not, without Landlord's prior consent, place any
objects, including antennas, outdoor furniture, etc., in the parking areas,
landscaped areas or other areas outside of its Premises, or on the roof of the
Project.

         3.       Except for animals assisting the disabled, no animals shall
be. allowed in the offices, halls, or corridors in the Project.

         4.       Tenant shall not disturb the occupants of the Project or
adjoining buildings by the use of any radio or musical instrument or by the
making of loud or improper noises.

         5.       If Tenant desires telegraphic, telephonic or other electric
connections in the Premises, Landlord or its agent will direct the electrician
as to where and how the wires may be introduced; and, without such direction, no
boring or cutting of wires will be permitted. Any such installation or
connection shall be made at Tenant's expense.

         6.       Tenant shall not install or operate any steam or gas engine or
boiler, or other mechanical apparatus in the Premises, except as specifically
approved in the Lease. The use of oil, gas or inflammable liquids for heating,
lighting or any other purpose except Laboratory purposes is expressly
prohibited. Explosives or other articles deemed extra hazardous shall not be
brought into the Project.

         7.       Parking any type of recreational vehicles is specifically
prohibited on or about the Project. Except for the overnight parking of
operative vehicles, no vehicle of any type 'shall be stored in the parking areas
at any time. In the event that a vehicle is disabled, it shall be removed within
48 hours. There shall be no "For Sale" or other advertising signs on or about
any parked vehicle. All vehicles shall be parked in the designated parking areas
in conformity with all signs and other markings. All parking will be open
parking, and no reserved parking, numbering or lettering of individual spaces
will be permitted except as specified by Landlord.

         8.       Tenant shall maintain the Premises free from rodents, insects
and other pests.

         9.       Landlord reserves the right to exclude or expel from the
Project any person who, in the judgment of Landlord, is intoxicated or under the
influence of liquor or drugs or who shall in any manner do any act in violation
of the Rules and Regulations of the Project.

         10.      Tenant shall not cause any unnecessary labor by reason of
Tenant's carelessness or indifference in the preservation of good order and
cleanliness. Landlord shall not be responsible to Tenant for any loss of
property on the Premises, however occurring, or for any damage done to the
effects of Tenant by the janitors or any other employee or person.

         11.      Tenant shall give Landlord prompt notice of any defects in the
water, lawn sprinkler, sewage, gas pipes, electrical lights and fixtures,
heating apparatus, or any other service equipment affecting the Premises.

         12.      Tenant shall not permit storage outside the Premises,
including without limitation, outside storage of trucks and other vehicles, or
dumping of waste or refuse or permit any harmful materials to be placed in any
drainage system or sanitary system in or about the Premises.

              (C) ALL RIGHTS RESERVED 2001 ALEXANDRIA REAL ESTATE EQUITIES, INC.
                                                      CONFIDENTIAL - DO NOT COPY

<PAGE>

Short Form 3N Laboratory Lease              2625 HANOVER STREET/NANOSYS - PAGE 2

         13.      All moveable trash receptacles provided by the trash disposal
firm for the Premises must be kept in the trash enclosure areas, if any,
provided for that purpose.

         14.      No auction, public or private, will be permitted on the
Premises or the Project.

         15.      No awnings shall be placed over the windows in the Premises
except with the prior written consent of Landlord.

         16.      The Premises shall not be used for lodging, sleeping or
cooking or for any immoral or illegal purposes or for any purpose other than
that specified in the Lease. No gaming devices shall be operated in the
Premises.

         17.      Tenant shall ascertain from Landlord the maximum amount of
electrical current which can safely be used in the Premises, taking into account
the capacity of the electrical wiring in the Project and the Premises and the
needs of other tenants, and shall not use more than such safe capacity.
Landlord's consent to the installation of electric equipment shall not relieve
Tenant from the obligation not to use more electricity than such safe capacity.

         18.      Tenant assumes full responsibility for protecting the Premises
from theft, robbery and pilferage.

         19.      Tenant shall not install or operate on the Premises any
machinery or mechanical devices of a nature not directly related to Tenant's
ordinary use of the Premises and shall keep all such machinery free of
vibration, noise and air waves which may be transmitted beyond the Premises.

              (C) ALL RIGHTS RESERVED 2001 ALEXANDRIA REAL ESTATE EQUITIES, INC.
                                                      CONFIDENTIAL - DO NOT COPY

<PAGE>

Short Form 3N Laboratory Lease              2625 HANOVER STREET/NANOSYS - PAGE 1

                               EXHIBIT D TO LEASE

                       ACKNOWLEDGMENT OF COMMENCEMENT DATE

         This ACKNOWLEDGMENT OF COMMENCEMENT DATE is made this_______________day
of_______2002, between ARE-2625/2627/2631 HANOVER, LLC, a Delaware limited
liability company ("LANDLORD"), and NANOSYS, INC, a Delaware corporation
("TENANT"), and is attached to and made a part of the Lease dated January_____,
2002 (the "LEASE"), by and between Landlord and Tenant. Any initially
capitalized terms used but not defined herein shall have the meanings given them
in the Lease.

         Landlord and Tenant hereby acknowledge and agree, for all purposes of
the Lease, that the Commencement Date of the Term of the Lease
is_____________,_______and the termination date of the Term of the Lease shall
be midnight on___________,_______.

         IN WITNESS WHEREOF, Landlord and Tenant have executed this
ACKNOWLEDGMENT OF COMMENCEMENT DATE to be effective on the date first above
written.

                                     TENANT:

                                     NANOSYS, INC.
                                     a Delaware corporation

                                     By:________________________________________
                                     Its:_______________________________________

                                     LANDLORD:

                                     ARE-2625/2627/2631 HANOVER, LLC,
                                     a Delaware limited liability company

                                     By:  ALEXANDRIA REAL ESTATE EQUITIES, L.P.,
                                          a Delaware limited partnership,
                                          managing member

                                          By:  ARE-QRS CORP.,
                                               a Maryland corporation,
                                               general partner

                                               By:______________________________
                                               Its:_____________________________

              (C) ALL RIGHTS RESERVED 2001 ALEXANDRIA REAL ESTATE EQUITIES, INC.
                                                      CONFIDENTIAL - DO NOT COPY

<PAGE>

Short Form 3N Laboratory Lease              2625 HANOVER STREET/NANOSYS - PAGE 1

                               EXHIBIT E TO LEASE

                           TENANT'S PERSONAL PROPERTY

              (C) ALL RIGHTS RESERVED 2001 ALEXANDRIA REAL ESTATE EQUITIES, INC.
                                                      CONFIDENTIAL - DO NOT COPY

<PAGE>

Short Form 3N Laboratory Lease              2625 HANOVER STREET/NANOSYS - PAGE 1

                               EXHIBIT F TO LEASE

                            PRE-APPROVED ALTERATIONS

2 HEPA Filters

1 D1 Water System

1 Vented Fume Hood

              (C) ALL RIGHTS RESERVED 2001 ALEXANDRIA REAL ESTATE EQUITIES, INC.
                                                      CONFIDENTIAL - DO NOT COPY

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00065-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00065-of-00352.parquet"}]]