Document:

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                                                                   EXHIBIT 10.35

                                      LEASE

                                 BY AND BETWEEN

                      E. I. DU PONT DE NEMOURS AND COMPANY

                                       AND

                              INCYTE GENOMICS, INC.

<PAGE>

                                TABLE OF CONTENTS

1. DATE OF LEASE; PARTIES......................................................1
2. LEASED PREMISES.............................................................1
  (a) LEASED PREMISES..........................................................1
      ---------------
  (b) Additional Space.........................................................1
      ----------------
  (c) BOMA Measurement.........................................................2
      ----------------
3. TERM........................................................................2
  (a) Initial Term.............................................................2
  (b) Extension Option.........................................................3
  (c) Postponement of Delivery Dates...........................................3
  (d) TENANT's Early Access....................................................3
      ---------------------
4. RENT........................................................................3
  (a) Base Rent................................................................3
  (b) Place of Payment.........................................................4
  (c) Additional Rent..........................................................4
  (d) No Payment for Common Costs..............................................4
  (e) Government Incentive Programs............................................4
      -----------------------------
  (f) Invoicing for Water, Sewer and Electric..................................4
      ---------------------------------------
5. USE OF PREMISES.............................................................5
  (a) Permitted Uses...........................................................5
  (b) Access...................................................................5
  (c) Occupancy of LEASED PREMISES.............................................5
  (d) Compliance With Laws.....................................................5
  (e) Rules and Regulations....................................................5
  (f) Hazardous Substances.....................................................6
  (g) Environmental Matters....................................................6
  (h) Criminal Background Checks..............................................13
      --------------------------
6. UTILITIES AND SERVICES.....................................................13
  (a) General.................................................................13
      -------
  (b) Temporary Shutdown......................................................14
      ------------------
  (c) LANDLORD Not a Public Utility...........................................14
      -----------------------------
  (d) No Representations......................................................14
      ------------------
  (e) Telecommunications Infrastructure.......................................15
      ---------------------------------
  (f) Non-Standard Services...................................................15
      ---------------------
7. SIGNS......................................................................15
8. ASSIGNMENT AND SUBLETTING..................................................15
9. CONDITION OF PREMISES......................................................16
  (a) Representations.........................................................16
      ---------------
  (b) No Alterations..........................................................16
      --------------
  (c) Joint Inspection........................................................16
      ----------------
10. ALTERATIONS...............................................................16
  (a) General Provisions......................................................16
  (b) Rights of Removal.......................................................17

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  (c) Obligation to Remove....................................................17
  (d) Abandonment.............................................................17
  (e) Compliance with Laws....................................................17
11. MAINTENANCE AND REPAIRS...................................................17
  (a) TENANT's Responsibilities...............................................18
  (b) LANDLORD's Responsibilities.............................................18
12. LIABILITY.................................................................18
13. ACCESS TO LEASED PREMISES.................................................18
14. CASUALTY..................................................................19
  (a) Non-Material Casualty...................................................19
  (b) Material Casualty.......................................................19
15. ADDITIONAL INDEMNITY......................................................20
  (a) TENANT Indemnity........................................................20
  (b) LANDLORD Indemnity......................................................20
  (c) Limitations.............................................................20
      -----------
16. EVENTS OF DEFAULT AND REMEDIES............................................21
  (a) General.................................................................21
  (b) Additional Events of Default............................................21
  (c) Remedies................................................................21
17. EMINENT DOMAIN............................................................21
18. SUBORDINATION ............................................................22
19. SURRENDER.................................................................22
20. INSURANCE.................................................................22
  (a) TENANT's Insurance......................................................22
  (b) LANDLORD's Insurance....................................................23
  (c) Self-Insurance..........................................................23
  (d) Release and Waiver of Subrogation.......................................23
21. QUIET ENJOYMENT...........................................................24
22. MAINTENANCE OF RECORDS/INSPECTION.........................................24
23. JURISDICTION; FORUM; ETC..................................................24
24. NOTICES...................................................................24
25. CORPORATE COVENANTS AND REPRESENTATIONS...................................25
26. INTEGRATION...............................................................25
27. NO PARTNERSHIP............................................................25
28. GOVERNING LAW.............................................................25
29. HEADINGS..................................................................26
30. SEVERABILITY..............................................................26
31. SUCCESSION................................................................26
32. COUNTERPARTS..............................................................26
33. INTERPRETATION............................................................26
35. FORCE MAJEURE.............................................................26
36. SURVIVAL..................................................................27
37. CONFIDENTIALITY...........................................................27
38. DATA TRANSFER AND PRIVACY.................................................27
39. NON-SOLICITATION OF DUPONT EMPLOYEES......................................27

                                       ii

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                                    EXHIBITS

Exhibit "A"  -   Diagram of LEASED PREMISES and Legal Description of Shared Site
Exhibit "B"  -   Rent Schedule
Exhibit "C"  -   DuPont's Policies, Standards and Guidelines
Exhibit "D"  -   Initial TENANT Alterations
Exhibit "E"  -   Shared Utilities and Ancillary Rent Services
Exhibit "F"  -   Decontamination Procedures

                                      iii

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                             INDEX OF DEFINED TERMS

<TABLE>
<S>                                                      <C>           <S>                                                       <C>
A                                                                      G

Additional Rent...........................................4            Governmental Authority....................................7

B                                                                      H

Brokers..................................................26            Hazardous Substance.......................................7
Building 112..............................................1
Building 115..............................................1            I
Building 115 Delivery Date................................1
Building 300 Space........................................1            Incentive Payments........................................4
                                                                       Initial Term..............................................2
C
                                                                       L
Casualty Insurance.......................................23
Common Areas..............................................1            LANDLORD..................................................1
                                                                       Laws......................................................7
D                                                                      Lease.....................................................1
                                                                       LEASED PREMISES...........................................1
DuPont's PSGs.............................................6            Losses....................................................7

E                                                                      P

Environment...............................................6            Parking Spaces............................................1
Environmental Claim.......................................6
Environmental Indemnities................................11            R
Environmental Laws........................................6
Environmental Permit......................................7            Release...................................................7
Expiration Date...........................................2            Renewal Term..............................................3
                                                                       Rules and Regulations.....................................5
F
                                                                       S
Final Space Delivery Date.................................2
Fixtures..................................................1            Shared Site...............................................1
Force Majeure............................................26            Shared Utilities and Ancillary Rent Services Exhibit......4

                                                                       T

                                                                       TENANT....................................................1

                                                                 iv
</TABLE>

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                      Lease - Stine Haskell Research Center

                                 LEASE AGREEMENT

     1.  DATE OF LEASE; PARTIES. THIS LEASE AGREEMENT (this "Lease") is made
this 28th day of February, 2002, by and between E. I. DU PONT DE NEMOURS AND
COMPANY, a Delaware corporation ("LANDLORD"), and INCYTE GENOMICS, INC., a
Delaware corporation ("TENANT").

     2.  LEASED PREMISES.

         (a)  LEASED PREMISES. LANDLORD hereby leases to TENANT, and TENANT
              ---------------
hereby rents from LANDLORD, a portion of Building 300 (the "Building 300 Space")
and Building 112 ("Building 112, each of which is more particularly shown on
Exhibit "A" attached hereto and made a part hereof. The Building 300 Space and
Building 112 are all located within LANDLORD's Stine-Haskell Research Center
situated at 1090 Elkton Road in the City of Newark, County of New Castle, State
of Delaware ("Shared Site"). The Building 300 Space contains approximately
32,557 rentable square feet, and Building 112 contains approximately 14,415
rentable square feet. The leasing of the Building 300 Space and Building 112
includes (i) all laboratory hoods and work bench stations (and appurtenances to
the foregoing, but excluding detachable biosafety cabinets), if any, located
therein and all other property located therein which, by reason of intention,
annexation, unity, attachment or adaptation for particular use, may fairly be
deemed fixtures under applicable law ("Fixtures"), (ii) the right to use the
parking spaces shown on Exhibit "A" ("Parking Spaces"), and (iii) the right, in
common with LANDLORD and other occupants of the Shared Site, to use internal
roads, driveways, sidewalks, loading areas, lobbies, hallways and other
appurtenances of the Shared Site commonly used by the occupants of the Shared
Site, including without limitation the library, Conference Room S300/202 and the
lunchroom located in Building 300 (collectively, "Common Areas") (the Building
300 Space and Building 112, together with the Fixtures, the Parking Spaces and
the Common Areas is hereinafter collectively referred to as the "LEASED
PREMISES"). TENANT acknowledges that, except as expressly set forth in this
Lease, TENANT is not relying on any statement or representation that has been
made by LANDLORD or any of LANDLORD's employees, agents, attorneys or
representatives concerning the condition of the LEASED PREMISES (whether
relating to physical conditions, operation, performance or legal matters (other
than matters relating to title)).

         (b)  Additional Space. If, during the Initial Term of this Lease,
              ----------------
LANDLORD shall receive, and wish to accept, a bona fide offer for the lease of
any or all of Building 115 on the Shared Site ("Building 115"), or shall desire
to use Building 115 for its own purposes, LANDLORD shall first notify TENANT in
writing of such offer or desire. In such event, LANDLORD hereby gives and grants
unto TENANT the right of first refusal to lease Building 115. If TENANT wishes
to exercise such right, TENANT shall notify LANDLORD of its intent to lease
Building 115 within 10 days following TENANT's receipt of LANDLORD's notice. If
TENANT does exercises such right, LANDLORD shall be obligated to lease Building
115 to TENANT on the date specified in TENANT's exercise notice, which date (the
"Building 115 Delivery Date") shall be no later than 20 days after the date of
TENANT's exercise notice.

                                       1

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Effective on the Building 115 Delivery Date, (i) Building 115 shall be added to
and become a part of the LEASED PREMISES, (ii) the representations and
warranties of LANDLORD in Paragraph 9 below shall be deemed to be re-made with
respect to Building 115, (iii) the base rent for Building 115 shall be the same
per rentable square foot rent as is then charged for the balance of the LEASED
PREMISES, and (iv) Building 115 shall be governed by all of the provisions of
this Lease. The lease of Building 115 shall include all Fixtures, the right to
use the Parking Spaces, and the right, in common with LANDLORD and other
occupants of the Shared Site, to use the Common Areas. Should TENANT fail to
notify LANDLORD within the prescribed 10 day period, LANDLORD shall be free to
lease Building 115, free and clear of all restrictions otherwise imposed by this
subparagraph 2(b). Notwithstanding that TENANT should fail or refuse to exercise
its right of first refusal, if Building 115 is not leased or used by LANDLORD
within three months after LANDLORD's notice, then TENANT's right of first
refusal and provisions of this subparagraph 2(d) shall be reinstated.

         (c)  BOMA Measurement. TENANT shall have the option during the term of
              ----------------
this Lease to have a licensed architect measure the rentable square footage of
the portions of space comprising the LEASED PREMISES in accordance with the most
current BOMA standards for multi-tenant buildings. If such measurement
demonstrates that the actual rentable square footage of the any portion of the
LEASED PREMISES is less than the approximate rentable square footage set forth
the preceding subparagraphs of this Paragraph 1, then the rent and all other
obligations of TENANT determined as a result of rentable square footage shall
automatically be reduced from and after the date TENANT delivers such
architect's calculation to LANDLORD.

     3.  TERM.

         (a)  Initial Term. The initial term of this Lease (the "Initial Term")
              ------------
shall commence on the Commencement Date (as defined below) and shall end on the
date ("Expiration Date") which is the last day of the month in which the second
anniversary of the Final Space Delivery Date (as defined below) occurs, subject
to the terms of subparagraphs 3(b), 3(c) and 3(d) below. The parties expect that
LANDLORD will deliver possession of the portions of space comprising the LEASED
PREMISES in accordance with the provisions of this Lease on the following dates:

   Space                                        Expected Delivery Date
   -----                                        ----------------------
Building 300 Space                 March 15, 2002 ("Building 300 Delivery Date")
Building 112                       March 15, 2002 ("Building 112 Delivery Date")

          A Delivery Date will not be deemed to have occurred until LANDLORD (or
a third party with whom LANDLORD has contracted) has substantially completed any
work required to be performed in the portions of space comprising the LEASED
PREMISES prior to TENANT's occupancy, including without limitation the
telecommunications work described in subparagraph 6(e) below and the
decommissioning work described in subparagraph 9(a) below, and exclusive
possession thereof has been delivered to TENANT. The first to occur of the
Building 300 Delivery Date and the Building 112 Delivery Date shall be the
"Commencement Date." The last to occur of the Building 300 Delivery Date and the
Building 112 Delivery Date shall be the "Final Space Delivery Date." Once the
Commencement Date and Final Space

                                       2

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Delivery Date occur, LANDLORD and TENANT shall execute a written confirmation of
such dates and the Expiration Date.

         (b)  Extension Option. TENANT may extend the term of this Lease on two
              ----------------
occasions, for a period of three (3) months in each case (each, a "Renewal
Term"), by giving LANDLORD at least ninety (90) days' written notice and
provided that no Event of Default has occurred and is continuing. The extension
must be exercised in the manner specifically set forth in this subparagraph
3(b), or it shall be deemed waived and all of TENANT's rights with respect
thereto shall wholly cease, terminate and expire. Time shall be of the essence
in connection with the exercise and the delivery of any extension notice by
TENANT hereunder. Any such notice shall be irrevocable upon delivery thereof.

         (c)  Postponement of Delivery Dates. The Building 300 Delivery Date and
              ------------------------------
the Building 112 Delivery Date, rent and TENANT's other obligations with respect
to each such space shall be postponed to the extent LANDLORD fails to deliver
possession of the applicable space by the expected delivery date set forth in
subparagraph 3(a) above in the condition required by this Lease, including
without limitation Paragraph 9 hereof, whether due to the holding over by a
prior occupant or otherwise. If either of the Building 300 Delivery Date or the
Building 112 Delivery Date is postponed for more than thirty (30) days, TENANT
shall have the option, by giving LANDLORD written notice, to terminate this
Lease with respect to the applicable space, in which event this Lease shall
continue in full force and effect only with respect to the remaining space.

         (d)  TENANT's Early Access. LANDLORD shall permit TENANT to enter all
              ---------------------
or any portion of the LEASED PREMISES as soon as possible following the
execution of this Lease in order to permit TENANT to perform certain work to
prepare the LEASED PREMISES for TENANT's occupancy. If LANDLORD or any third
party is still performing any work at a time when TENANT is granted early access
to a portion of space comprising the LEASED PREMISES, TENANT shall not interfere
with such ongoing work. During any such early access period, TENANT shall comply
with all the terms and conditions of this Lease, but TENANT shall not be
obligated to pay rent during such period.

     4.  RENT.

         (a)  Base Rent. Beginning on the Building 300 Space Delivery Date and
              ---------
the Building 112 Delivery Date, and thereafter on the first business day of each
calendar month during the Initial Term, TENANT shall pay to LANDLORD for the
Building 300 Space and Building 112, respectively, as monthly base rent
(exclusive of water, sewer and electric), the amounts set forth on Exhibit "B"
attached hereto (except that for any partial calendar month during the Initial
Term for which base rent shall be due and payable under this Lease, the base
rent shall be apportioned based on the number of days in such month). The
parties agree that base rent includes payment of the utilities and ancillary
rent services to be provided to TENANT by LANDLORD pursuant to Exhibit "E"
(exclusive of water, sewer and electric). The portion of base rent attributable
to such utilities and ancillary rent services may be adjusted following the
outsourcing of any utilities or services or adjusted to account for: any change
in the cost of complying with any law affecting the provision of a utility or
service; any material change to the nature of a utility or service; reasonably
anticipated changes (based on experience or expected

                                       3

<PAGE>

developments) in the historical cost or reasonably anticipated change in the
cost to LANDLORD of providing any utilities or services; and/or the cost of any
capital improvements for the benefit of the TENANT.

         (b)  Place of Payment. All payments of base rent and other sums
              ----------------
required to be paid to LANDLORD hereunder shall be in lawful money of the United
States of America and shall be paid to LANDLORD at the address set forth in the
Paragraph 24 hereof, or to such other person and/or at such other place as
LANDLORD may designate from time to time.

         (c)  Additional Rent. During the term hereof, TENANT shall pay to
              ---------------
LANDLORD, as additional rent (together with all other amounts payable by TENANT
hereunder other than base rent payable under subparagraph 4(a), "Additional
Rent"), charges for water, sewer and electric, each of which will be metered as
described in Exhibit "E" (the "Shared Utilities and Ancillary Rent Services
Exhibit"). Charges for water, sewer and electric may be adjusted by LANDLORD to
reflect any change in the cost imposed upon LANDLORD by a third party provider.

         (d)  No Payment for Common Costs. Except for charges for water, sewer
              ---------------------------
and electric, TENANT's payment of base rent shall include all amounts payable by
TENANT for its use of the Common Areas and the other services to be provided to
TENANT as described in the Shared Utilities and Ancillary Rent Services Exhibit.

         (e)  Government Incentive Programs. LANDLORD acknowledges that TENANT
              -----------------------------
is eligible for, and may receive, tax abatements, tax credits, grants or other
governmental or publicly-supported financial awards (collectively, "Incentive
Payments") for locating TENANT's business in the State of Delaware. LANDLORD
shall cooperate with TENANT in procuring any Incentive Payments for which TENANT
is eligible, and to the extent that any such Incentive Payments intended for
TENANT are awarded to LANDLORD (as, for example, an abatement of Taxes
attributable to LANDLORD's ownership of the Shared Site) the entire economic
benefit of such Incentive Payments shall be passed through to TENANT as a
reduction in base rent or in another manner mutually agreed upon by LANDLORD and
TENANT. In the event that any such Incentive Payments are awarded to LANDLORD
and passed through to TENANT, TENANT shall have the right to inspect, upon
reasonable prior notice and at reasonable times, LANDLORD's books and records
relating to such Incentive Payments. In no event shall TENANT have any right to,
or claim upon, any Incentive Payments for which LANDLORD may be separately
eligible, the parties hereby agreeing that this subparagraph 4(e) only applies
to Incentive Payments clearly intended for TENANT.

         (f)  Invoicing for Water, Sewer and Electric. LANDLORD shall have the
              ---------------------------------------
option of issuing invoices to TENANT on a monthly or quarterly basis. Each such
invoice shall set forth the amount of the total fee for water, sewer and
electric due for such month or quarter, as applicable. Payment terms are net 30
days of invoice receipt. TENANT shall not be entitled to set off or reduce its
payments to LANDLORD by any amounts TENANT claims are owed to it by LANDLORD.
The parties will implement arrangements to provide for electronic funds transfer
on customary terms for such payments. Upon the termination of this Lease, there
will be a final accounting, and each party shall promptly pay to the other any
amounts owed. Undisputed late payment shall bear an interest on the amount paid
late at the prime rate of

                                       4

<PAGE>

interest announced publicly from time to time in New York City, New York, U.S.A.
by Morgan Guaranty Trust prorated for the number of days such overdue amounts
are outstanding.

     5.  USE OF PREMISES.

         (a)  Permitted Uses. Subject to the further provisions of this
              --------------
Paragraph 5, TENANT may use and occupy the LEASED PREMISES for general office
purposes and chemical and biological research and development, including related
functions.

         (b)  Access. LANDLORD shall provide TENANT and its invitees with full
              ------
and complete ingress and egress to the LEASED PREMISES across LANDLORD's lands
and properties on a 24 hour per day, seven day per week basis. Notwithstanding
the foregoing, in the event TENANT is prohibited from using its usual means of
ingress and egress to the LEASED PREMISES for any reason (including without
limitation, maintenance being performed at the Shared Site), LANDLORD may
provide TENANT with an alternate route of ingress and egress to the LEASED
PREMISES regardless of whether such route is more circuitous. LANDLORD shall
provide TENANT, as a service pursuant to this Paragraph 5, with parking based on
an allocation of parking spaces of three and one-half (3.5) parking spaces per
1,000 square feet of leased space within the LEASED PREMISES. LANDLORD shall not
charge any fee to TENANT for the use of such parking spaces.

         (c)  Occupancy of LEASED PREMISES. TENANT shall not permit the LEASED
              ----------------------------
PREMISES to become or remain vacant or unoccupied for a period of time exceeding
six (6) months, except as may be necessary in connection with alterations,
improvements or replacements made pursuant to Paragraphs 10 or 11 hereof.

         (d)  Compliance With Laws. TENANT shall comply at TENANT's sole cost
              --------------------
and expense with all applicable federal, state, county and local laws, codes,
ordinances and regulations, and with the rules or regulations of any applicable
Local Board of Underwriters, with respect to use and occupancy of the LEASED
PREMISES; provided, however, to the extent any capital improvements or
replacements are required to be made to any portion of the LEASED PREMISES in
order to comply with any of the foregoing, TENANT shall only be responsible for
capital improvements and replacements required by TENANT's manner of use of the
LEASED PREMISES.

         (e)  Rules and Regulations. TENANT shall comply with DuPont's PSGs (as
              ---------------------
defined in subparagraph 5(g) below) and any other of LANDLORD's rules and
regulations that are applicable to the LEASED PREMISES and the Shared Site
("Rules and Regulations"). Any such Rules and Regulations shall be reasonable
and consistent in all material respects with the rules and regulations
applicable to any occupants of any other premises on the Shared Site, including
LANDLORD. The current Rules and Regulations are attached as a part of Exhibit
"C." LANDLORD shall provide TENANT reasonable advance notice of all changes in
LANDLORD's Rules and Regulations. Notwithstanding the foregoing, in the event of
any inconsistencies between the terms and conditions of this Lease and the Rules
and Regulations, the terms and conditions of this Lease shall prevail, and the
Rules and Regulations shall not apply to TENANT to the extent that they
unreasonably interfere with, or make materially more

                                       5

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costly, TENANT's permitted uses of the LEASED PREMISES as provided in
subparagraph 5(a) hereof.

         (f)  Hazardous Substances. Any use, production, storage, deposit or
              --------------------
disposal of Hazardous Substances (as defined in subparagraph 5(g) below) by
TENANT on any portion of the LEASED PREMISES shall be performed or accomplished
in accordance with all Environmental Laws (as defined in subparagraph 5(g)
below). Unless otherwise agreed to by LANDLORD, TENANT, during and upon
termination of this Lease, shall promptly remove all such Hazardous Substances
used, produced, or stored on site by TENANT from the LEASED PREMISES in
accordance with all Environmental Laws.

         (g)  Environmental Matters.
              ---------------------

              (i)    Certain Defined Terms. As used in this Lease, the following
terms have the following meanings (such meanings equally to be applicable to the
singular as well as the plural form of the terms defined):

                     (1)  "DuPont's PSGs" means those SHE Policies, Standards
and Guidelines and Security Policies and Standards as implemented at the
facility as of the date hereof and described in Exhibit "C," a copy of which has
been provided to TENANT.

                     (2)  "Environment" means any surface water, groundwater,
drinking water supply, land surface or subsurface strata, or ambient air.

                     (3)  "Environmental Claim" means any claim, action, cause
of action, investigation, demand, order, directive or written notice by or on
behalf of, any Governmental Authority or any other individual, corporation,
limited liability company, partnership, trust or other entity, or former
employee, alleging potential liability (including, without limitation, potential
liability for investigatory costs, clean-up costs, governmental response costs,
natural resources damages, property damages, personal injuries, medical
monitoring or penalties) arising out of, based on or resulting from: (i) the
presence, Release or threatened Release of any Hazardous Substance at any
location; (ii) exposure to any Hazardous Substance; or (iii) requirements or
violation of any Environmental Law or Environmental Permit.

                     (4)  "Environmental Laws" means all Laws relating to
pollution or protection of human health or the Environment, including, without
limitation, the Comprehensive Environmental Response, Compensation, and
Liability Act, the Resource Conservation and Recovery Act, the Clean Air Act,
the Clean Water Act, the Occupational Safety and Health Act, the Toxic
Substances Control Act, any amendments thereto and any rules and regulations
promulgated pursuant to or implementing the foregoing, similar state Laws and
other Laws relating to any of (i) Releases, threatened Releases or the presence
of Hazardous Substances or the manufacture, processing, distribution, use,
treatment, storage, transport or handling of Hazardous Substances, including the
disposal of radioactive materials, (ii) noise or odors, (iii) pollution or
protection of the air, surface water, groundwater, drinking water, land surface
or subsurface strata, or (iv) exposure to Hazardous Substances and employee
health and safety.

                                       6

<PAGE>

                     (5)  "Environmental Permit" means any permit, license,
approval or other authorization under any applicable Law or of any Governmental
Authority relating to Environmental Laws.

                     (6)  "Governmental Authority" means the United States of
America, the State of Delaware and any municipality or other political
subdivision thereof, and any of their respective entities, bodies, agencies,
commissions or courts exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to government and any executive
official thereof.

                     (7)  "Hazardous Substance" means any substance, whether
solid, liquid or gaseous, which is listed, defined or regulated as a "hazardous
substance", "hazardous waste", "oil", "pollutant", "toxic substance", "hazardous
material waste", or "contaminant" or is otherwise classified as hazardous or
toxic, in or pursuant to any Environmental Law; or which is or contains any
asbestos, polychlorinated biphenyls, urea formaldehyde foam insulation,
explosive, nuclear, or radioactive material, or motor fuel or other petroleum
hydrocarbons, or pesticides, insecticides, fungicides, or rodenticides, or
biohazardous materials or waste.

                     (8)  "Laws" means all laws, statutes, ordinances, rules,
regulations, orders, writs, judgments, codes, injunctions or decrees of any
Governmental Authority.

                     (9)  "Losses" means any and all damages, losses,
deficiencies, liabilities, obligations, penalties, judgments, settlements,
claims, payments, fines, interest, costs and expenses (including, without
limitation, the costs and expenses of any and all actions and demands,
assessments, judgments, settlements and compromises relating thereto and the
costs and expenses of attorneys', accountants', consultants' and other
professionals' fees and expenses incurred in the investigation or defense
thereof or the enforcement of rights hereunder), but excluding consequential
damages, loss of profits and punitive damages (other than such damages awarded
to any third party against the party being indemnified).

                     (10) "Release" means any release, spill, emission,
discharge, leaking, pumping, injection, deposit, disposal, dispersal, leaching
or migration into the indoor or outdoor Environment or into or out of any
property, including the movement of Hazardous Substances through or in the air,
soil, surface water or groundwater.

              (ii)   General.
                     -------

                     (1)  TENANT acknowledges that hazards may be involved in
its operations on the Shared Site. Accordingly, TENANT shall perform its work in
a careful and workmanlike manner and take all necessary precautions in
processing, handling, transporting and disposing of material and product
involved in its operations, to avoid: (w) an unhealthy or unsafe work
environment; (x) injuries to persons; (y) damage to property; or (z) pollution.
The methods employed and the precautions taken shall be determined by and rest
solely with TENANT. Any information supplied by TENANT to LANDLORD shall be the
latest information known to TENANT, but TENANT does not warrant that the
information is necessarily complete.

                                       7

<PAGE>

                     (2)  LANDLORD acknowledges that hazards may be involved in
its operations on the Shared Site. Accordingly, LANDLORD shall perform its work
in a careful and workmanlike manner and take all necessary precautions in
processing, handling, transporting and disposing of material and product
involved in its operations, to avoid: (w) an unhealthy or unsafe work
environment; (x) injuries to persons; (y) damage to property; or (z) pollution.
The methods employed and the precautions taken shall be determined by and rest
solely with LANDLORD. Any information supplied by LANDLORD to TENANT shall be
the latest information known to LANDLORD, but LANDLORD does not warrant that the
information is necessarily complete.

              (iii)  DuPont's PSGs.
                     -------------

                     (1)  Subject to the other provisions of this subparagraph
5(g), TENANT, its invitees and contractors shall adhere in all material respects
to DuPont's PSGs then in effect. TENANT shall advise its employees and the
employees of its invitees and contractors that:

                          (A) It is the policy of LANDLORD to prohibit the
non-medical use, possession, sale, manufacture, dispensing, and distribution of
drugs or other controlled substances on the Shared Site, and to prohibit in the
workplace the presence of an individual with such substances in the body for
non-medical reasons; and

                          (B) Any person who is found in violation of such
guidelines and policies or who refuses to permit inspection may be removed or
barred from the Shared Site at the sole and absolute discretion of LANDLORD.

                     (2)  LANDLORD and TENANT each agrees to perform its
activities on or use the Shared Site in all material respects in accordance with
ACC (formerly CMA) Responsible Care guiding principles and, subject to the other
provisions of this subparagraph 5(g), comply in all material respects with
DuPont's PSGs, including any updates, corrections or modifications thereto
(provided, in the case of TENANT, that such updates, corrections or
modifications do not unreasonably interfere with, or make materially more
costly, TENANT's permitted uses of the LEASED PREMISES as provided in
subparagraph 5(a) hereof). LANDLORD and TENANT recognize that certain aspects of
DuPont's PSGs may not be applicable to TENANT's operations, and TENANT shall
only be obligated to adhere and comply with DuPont's PSGs to the extent
applicable to TENANT's operations or to the use of the Shared Site generally.
LANDLORD and TENANT shall jointly identify the provisions of DuPont's PSGs that
are applicable to TENANT's operations or use of the Shared Site. LANDLORD and
TENANT shall cooperate and assist each other in complying with all Environmental
Laws and the DuPont's PSGs. DuPont's PSGs, including any updates, corrections or
modifications thereto, are furnished to TENANT under a nontransferable,
non-exclusive and royalty-free license by LANDLORD to TENANT for TENANT's use at
the LEASED PREMISES. This license is effective on the Commencement Date and
shall remain in effect until this Lease expires or sooner terminates. DuPont's
PSGs, in whole or in part, are the property of LANDLORD, and no title to or
ownership of the DuPont's PSGs, or in any intellectual property rights relating
to the DuPont's PSGs, is transferred to TENANT. DuPont's PSGs contain
proprietary and confidential information of LANDLORD and as a condition of this

                                       8

<PAGE>

license, and except as required by law or prudent business practice (e.g.,
bankers, attorneys, insurers), TENANT agrees not to sell, lease, or otherwise
transfer, provide, disclose or make available copies of any DuPont's PSGs to any
other party without the prior written consent of LANDLORD.

                     (3)  TENANT recognizes that the DuPont's PSGs may provide
only minimal guidance for TENANT's compliance with Environmental Laws and
therefore will not rely on them for that purpose.

                     (4)  In order to protect its employees, contractors,
visitors and premises, LANDLORD has determined that there are certain minimally
acceptable elements that must be present in TENANT's policies, practices, and
operations at the LEASED PREMISES. The sole purpose of LANDLORD communicating
such elements in the DuPont's PSGs is for the protection of LANDLORD's
employees, contractors, visitors, and premises. There is no intention to
communicate to TENANT a comprehensive safety, health, and environmental program
which will meet its particular needs with respect to its employees, contractors,
visitors, and premises. It is understood that it remains the ultimate
responsibility of TENANT to evaluate its needs/risks and to develop those
programs and procedures it deems necessary to manage those needs/risks.
Notwithstanding the foregoing, LANDLORD retains the right, upon reasonable prior
notice (which, except in the event of an emergency, shall mean at least 48 hours
prior notice) and at LANDLORD's sole expense to enter at all reasonable times to
audit TENANT's material compliance with DuPont's PSGs and TENANT agrees to
cooperate in a reasonable manner with such audit; provided, however, that any
such audit shall occur no more frequently than once every six months unless
LANDLORD has reasonable grounds to request an audit more frequently and
identifies such grounds in a written request to TENANT, which request may not be
unreasonably refused by TENANT. LANDLORD shall promptly provide TENANT with the
findings of the audit and shall not disclose the findings to third parties,
except as may be required by Environmental Laws and only after notice to TENANT
(and, if permitted by the applicable Environmental Laws, shall allow TENANT to
make such disclosure provided TENANT does so within five business days of
receiving notice of the need therefor from LANDLORD).

              (iv)   Chemical Substances. Within sixty (60) days after the
                     -------------------
Commencement Date and as amended on a timely basis, TENANT shall provide
LANDLORD a list by chemical name, Chemical Abstract Service Number and by trade
name of all Hazardous Substances which it intends to use or store at the LEASED
PREMISES in quantities in excess of the lesser of (1) 5,000 gallons per calendar
year or (2) reportable quantities under CERCLA.

              (v)    Permits. LANDLORD and TENANT shall each obtain all
                     -------
Environmental Permits and other permits necessary for its respective operations
at the Shared Site. LANDLORD will provide support with respect to its Title V
Permit in accordance with, and TENANT shall comply with, the relevant provisions
of the Shared Utilities and Ancillary Rent Services Exhibit.

              (vi)   Wastes. Unless as otherwise agreed and except as to
                     ------
LANDLORD's Environmental Liabilities (as defined below), TENANT shall retain
sole and complete responsibility for the management, storage and proper disposal
of chemical substances, wastes, discharges and emissions in all media produced
from its activities. TENANT shall

                                       9

<PAGE>

provide LANDLORD an updated list of the identity of any waste disposal
subcontractor, methods of waste disposal to be used, and the locations of sites
to be used for waste disposal not covered by the Shared Utilities and Ancillary
Rent Services Exhibit. TENANT shall transport and dispose of such waste in a
safe and environmentally sound manner to prevent any waste from entering the
environment as a pollutant. TENANT agrees that it will not engage in and will
not knowingly permit any other party to engage in any activity without prior
approval from LANDLORD with respect to the LEASED PREMISES that would reasonably
be expected to cause the LEASED PREMISES or the adjoining property of LANDLORD
to become a hazardous waste treatment, storage or disposal facility within the
meaning of RCRA.

              (vii)  MSDS. TENANT shall submit Material Safety Data Sheets
                     ----
complying with the Federal Hazard Communication Standard (OSHA 1910.1200)
together with its submission of the lists of Hazardous Substances required by
subparagraph 5(g)(iv) above. Such Hazardous Substances shall be properly labeled
and strictly controlled by TENANT as to their use and disposal.

              (viii) Notice. Each party hereto shall notify the other party of
                     ------
any incidents or conditions that may have adverse safety, health or
environmental consequences to employees, contractors, visitors or property.
While LANDLORD or TENANT may discover and/or disclose issues regarding the other
party's compliance with Environmental Laws and make recommendations to that
party to avoid noncompliance with Environmental Laws, neither party hereto makes
a representation or warranty that all possible compliance issues have been
identified and disclosed or that its disclosures or recommendations include all
possible recommendations to prevent the occurrence of noncompliance with
Environmental Laws. Neither party shall disclose information relating to the
other party's compliance with Environmental Laws to third parties, except as
required by Environmental Laws and only after notice to the other party (and, if
permitted by the applicable Environmental Laws, such party will allow the
non-complying party to make such disclosure provided the non-complying party
does so within five business days of receiving notice of the need therefor from
the other party). Neither party hereto certifies the other party's or any third
party's compliance with present or future Environmental Laws, and each party
agree to seek its own legal advice regarding its own compliance.

              (ix)   Compliance.
                     ----------

                     (1)  Each party shall be responsible for complying with
Environmental Laws relating to the operation of its activities at the Shared
Site and with respect to the provision and receipt of shared services under the
Shared Utilities and Ancillary Rent Services Exhibit. Notwithstanding the above,
LANDLORD or TENANT may contract out the record keeping and/or reporting
activities required by any Environmental Laws, provided that such party shall
not contract away its liability and responsibility for assuring that any
required records or reports comply with the legal requirements and are truthful
and accurate.

                     (2)  Notwithstanding the foregoing, complaints from the
community regarding odors or excessive emissions shall be handled through
LANDLORD procedures and communicated promptly to each party's site
representative.

                                       10

<PAGE>

              (x)    Indemnity.
                     ---------

                     (1)  LANDLORD agrees to indemnify, release, defend and hold
harmless TENANT from and against all Environmental Claim(s) and/or Losses which
arise, or are alleged to arise, from or in connection with:

                          (A) Any non-compliance with any Environmental Law or
Environmental Permits at the Shared Site (whether on or off the Shared Site)
occurring prior to the date hereof and any such non-compliance caused by
LANDLORD after the date hereof;

                          (B) The generation, manufacture, refining,
transportation, treatment, storage, handling, disposal, discharge, Release or
spill of any Hazardous Substance at the Shared Site (whether on or off the
Shared Site) occurring prior to the date hereof and any such generation,
manufacture, refining, transportation, treatment, storage, handling, disposal,
discharge, Release or spill of any Hazardous Substance caused by LANDLORD after
the date hereof;

                          (C) Any disturbance, migration, leaching or Release of
any Hazardous Substance onto, off of, near, under, or otherwise affecting the
Shared Site occurring prior to the date hereof and any such disturbance,
migration, leaching or Release of any Hazardous Substance continuing or caused
by LANDLORD after the date hereof; or

                          (D) Any quantity of a Hazardous Substance which was at
the Shared Site and disposed of off the Shared Site in any such case, prior to
the date hereof, or disposed of or caused by LANDLORD after the date hereof.

                     Notwithstanding the foregoing clauses (A) through (D)
above (collectively, LANDLORD's "Environmental Indemnities"), LANDLORD's
indemnity does not extend to Environmental Claims or Losses associated with soil
excavation, characterization or disposal by/for TENANT after the date hereof (as
for example and not a limitation, excavation, characterization or disposal
undertaken during construction or facility modification as permitted pursuant to
the terms hereof) and such Environmental Claims or Losses shall be borne by
TENANT.

                     (2)  TENANT agrees to indemnify, release, defend and hold
harmless LANDLORD from and against all Environmental Claims or Losses which
arise, or are alleged to arise, from or in connection with:

                          (A) TENANT's release of a Hazardous Substance in
violation of any Environmental Law at the Shared Site (whether on or off the
Shared Site) occurring on or after the Commencement Date;

                          (B) TENANT's violation of any Environmental Law at the
Shared Site (whether on or off the Shared Site) occurring on or after the
Commencement Date;

                                       11

<PAGE>

                          (C) The generation, manufacture, refining,
transportation, treatment, storage, handling, disposal, discharge, Release or
spill of any Hazardous Substance at the Shared Site by TENANT or its contractors
or subcontractors; and

                          (D) Any disturbance, migration, leaching or Release of
any Hazardous Substances on, onto, near, under or otherwise affecting the Shared
Site (including, without limitation, the LEASED PREMISES), provided that the
origin, disturbance, migration, leaching or release of the Hazardous Substance
was due to the actions or operations of TENANT or its contractors or
subcontractors.

                     (3)  Where LANDLORD and TENANT have jointly caused any
Environmental Claims or Losses, whether or not a third party's acts or omissions
also were causal, TENANT and LANDLORD shall contribute to their common liability
a pro rata share based upon the relative degree of fault of each (including
attorneys' fees and other costs of defense). Each party hereto shall bear its
own attorneys' fees and costs of defense, subject to reimbursement by the other
party, until:

                          (A) There is a final court judgment allocating fault
between the LANDLORD and TENANT; or

                          (B) LANDLORD and TENANT otherwise agree to an
allocation.

                     Upon the occurrence of an event described in clauses (A) or
(B) above, TENANT shall reimburse LANDLORD for that portion of the past costs,
attorneys' fees and defense costs incurred by LANDLORD which is equal to
TENANT's share of the allocation, or LANDLORD shall reimburse TENANT for that
portion of the past costs, attorneys' fees and defense costs paid by TENANT
which is equal to LANDLORD's share of the allocation, whichever is applicable.
Thereafter, LANDLORD and TENANT shall share the costs according to the
allocation.

                     (4)  In the event of any Environmental Claims and/or Losses
for which a party hereto is entitled to indemnity hereunder, the party seeking
indemnity shall immediately notify in writing the indemnifying party of such
matter, shall fully cooperate with the indemnifying party in the defense of the
Environmental Claims and/or Losses and, at the indemnifying party's cost, permit
the indemnifying party's attorneys to handle and control the conduct and/or
settlement of such Environmental Claims and/or Losses, including making
personnel and records available for the defense. In no event shall the
indemnifying party agree to a settlement that contains a non-monetary component
without the consent of the indemnified party, which consent not to be
unreasonably withheld or delayed. The above indemnification provision is
contingent upon the indemnified party promptly turning over the complete control
of the Environmental Claims and/or Losses to the indemnifying party.

              (xi)   Limitation. The foregoing indemnities are subject to the
                     ----------
provisions of subparagraph 15(c). Furthermore, nothing contained herein shall
prohibit either party hereto from seeking restitution or contribution from third
parties.

                                       12

<PAGE>

              (xii)  Survival. The provisions of this subparagraph 5(g) shall
                     --------
expressly survive the expiration or earlier termination of this Lease.

         (h)  Criminal Background Checks. Prior to hiring or assigning any
              --------------------------
employee to perform work at the LEASED PREMISES, TENANT shall have performed a
criminal background check to determine whether such employee has been convicted
of any felony crimes, felony crimes plea bargained to a lesser charge, or
previous misdemeanor crime. TENANT shall not, without LANDLORD's prior written
approval, permit an employee to work at the LEASED PREMISES if that employee has
within the prior seven year period been convicted of any felony crimes, felony
crimes plea bargained to a lesser charge, or previous misdemeanor crime.
TENANT's criminal background check program must be in compliance with the Fair
Credit Reporting Act and LANDLORD's Contractor Criminal Background Investigation
Requirements, a copy of which has been provided to TENANT.

     6.  UTILITIES AND SERVICES.

         (a)  General. LANDLORD shall furnish the LEASED PREMISES with those
              -------
utilities and services necessary to use the LEASED PREMISES for the purposes
described in subparagraph 5(a) above, including without limitation those
identified on the Shared Utilities and Ancillary Rent Services Exhibit. LANDLORD
and TENANT hereby agree that the Shared Utilities and Ancillary Rent Services
Exhibit shall govern the provision of such services in connection with the
TENANT's use of the LEASED PREMISES. LANDLORD shall provide shared utilities and
ancillary rent services to TENANT using the same degree of care as it exercises
in providing such utilities and services for its own use, and nothing in this
Lease shall imply or require that LANDLORD shall meet a higher standard of care
which might be applicable to commercial providers of such services. Nothing in
this Lease shall require LANDLORD to favor TENANT over the businesses of
LANDLORD, nor shall LANDLORD favor its business over the TENANT's business in
providing such utilities and services. Should TENANT's use of shared utilities
or services require LANDLORD to expand, modify or modernize its equipment or
distribution lines to provide such utilities or services, and TENANT requests
that LANDLORD proceed with such expansion, modification or modernization after
written notice from LANDLORD of the need therefor, the cost of such work shall
be for TENANT's account, unless agreed otherwise. Should LANDLORD, in it's sole
discretion expand, modify, or modernize its equipment or distribution lines to
provide such utilities or services, the cost thereof shall be apportioned fairly
between LANDLORD, TENANT and any other tenants at the Shared Site. All utilities
and services shall be provided by employees of LANDLORD or its affiliates, or at
LANDLORD's election, by third parties to whom it has contracted. All references
in this Lease to LANDLORD providing a utilities or services shall include both
provision by the LANDLORD and indirect provision by third parties. TENANT agrees
that the utilities or services provided by third parties are conditioned upon
performance by such third parties under their separate agreements between
LANDLORD and such third parties. LANDLORD reserves the right to purchase any
utilities or services from a third party or to change a third party provider. In
no event shall TENANT be entitled to re-sell or supply any utilities or
ancillary rent service to a third party. LANDLORD shall not be required to
provide TENANT extraordinary levels of service that are above the ordinary
levels, special studies, training, or the like.

                                       13

<PAGE>

         (b)  Temporary Shutdown. LANDLORD, at its sole and absolute discretion,
              ------------------
shall have the right to shut down and/or suspend any utility or ancillary rent
service, in whole or in part, at any time for reasons of safety, health or
environment. In this regard, LANDLORD will use good faith efforts and reasonable
diligence to address such safety, health or environmental matters, and TENANT
shall fully cooperate with LANDLORD. LANDLORD shall use good faith efforts and
reasonable diligence to expeditiously resume the supply of the affected utility
or ancillary rent service after, in the sole and absolute judgment of LANDLORD,
such concern is abated. Further, in the event of a temporary partial loss of a
utility or ancillary rent service due to equipment failure or Force Majeure
causes, LANDLORD will fairly allocate such portions of the affected utilities or
ancillary rent services between LANDLORD's operations, TENANT and other tenants
of the Shared Site. If any utility or service is not fully restored within
fifteen (15) days of the shut down or suspension thereof, and if such shut down
or suspension materially interferes with TENANT's use and enjoyment of the
LEASED PREMISES, LANDLORD shall proportionately reduce the rent due hereunder
during the period of material interference.

         (c)  LANDLORD Not a Public Utility. It is understood that neither party
              -----------------------------
hereto considers LANDLORD to be a regulated public utility. Furthermore, neither
party intends by this Lease to engage in the business of being a public utility
or to enjoy any of the powers and privileges of a public utility or by its
performance of its obligations to dedicate to public or quasi-public use or
purpose any of the facilities which it operates, and each party agrees that the
execution of this Lease shall not, nor shall any performance or partial
performance, be or ever be deemed, asserted or urged by a party to be a
dedicated public or quasi-public use of any such facilities of the other party,
or as subjecting the other party to any jurisdiction or regulation as a public
utility. Notwithstanding the foregoing, should LANDLORD be determined to be a
public utility or should LANDLORD determine in good faith based on the advice of
counsel that there is a material risk of it being deemed to be a public utility
LANDLORD may terminate the affected utility or service(s) upon not less than
ninety (90) days' written notice to TENANT. Notwithstanding the foregoing, in
the event LANDLORD receives an order from any governmental authority requiring
LANDLORD to cease providing a service in less than ninety (90) days and LANDLORD
is unable to timely obtain a stay of enforcement of that order after exercising
its good faith efforts to do so, LANDLORD shall immediately notify TENANT of
such occurrence and may terminate such utility or ancillary rent service
consistent with the time period set forth in that order. Upon request by TENANT
and at TENANT's expense, LANDLORD must appeal such order and/or seek a stay of
enforcement, so LANDLORD can continue providing such utility or ancillary rent
service pending appeal of that order. If any utility or service is not fully
restored within fifteen (15) days LANDLORD ceases to provide it, and if such
cessation of a utility or service materially interferes with TENANT's use and
enjoyment of the LEASED PREMISES, LANDLORD shall proportionately reduce the rent
due hereunder during the period of material interference.

         (d)  No Representations. LANDLORD MAKES NO REPRESENTATION OR WARRANTY
              ------------------
OF ANY KIND, WHETHER EXPRESS OR IMPLIED, INCLUDING, BUT NOT LIMITED TO ANY
WARRANTY ARISING FROM OPERATION OF LAW OR OTHERWISE, INCLUDING ANY WARRANTY OF
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO ANY UTILITY
OR SERVICE PROVIDED HEREUNDER, THE QUALITY OR CONDITION THEREOF, OR ANY OTHER

                                       14

<PAGE>

MATTER. TENANT ASSUMES ALL RISK AND LIABILITY RESULTING FROM ITS RECEIPT AND/OR
USE OF A UTILITY OR SERVICE.

         (e)  Telecommunications Infrastructure. LANDLORD is not providing any
              ---------------------------------
telecommunications services to TENANT hereunder, but LANDLORD shall nonetheless
provide, at LANDLORD's sole cost and expense (or the expense of a third party
provider), all necessary trenching and other work to enable the LEASED PREMISES
to have access to such cabling, switching and other equipment as is suitable for
the use described in subparagraph 5(a) above. TENANT, together with any third
party provider, shall be solely responsible for the design and functionality of
any telecommunications system installed in the LEASED PREMISES.

         (f)  Non-Standard Services. In the event that TENANT requests LANDLORD
              ---------------------
to provide any non-standard service, or any service not contemplated by Exhibit
"E," LANDLORD shall have the option of providing such service, but shall have no
obligation to do so. If LANDLORD elects to provide the service, it will be
provided on terms and conditions agreed upon by the parties, including without
limitation the costs thereof.

     7.  SIGNS. No signs, advertisements or notices (other than those required
by law) shall be affixed to or placed upon any part of the LEASED PREMISES by
TENANT or anyone acting for or on behalf of TENANT, other than identification
signage on each of the portions comprising the LEASED PREMISES that are
consistent with identification signs used by other tenants (current or former)
of the Shared Site, provided that LANDLORD first approves signage, such approval
not to be unreasonably withheld, conditioned or delayed. If at any time TENANT
desires to modify such signage or to affix or place new signage upon any part of
the LEASED PREMISES, any such signage shall be affixed in a manner and be of
such size, design and color as shall be (i) consistent with the signs utilized
by LANDLORD on or in the portions of space comprising the LEASED PREMISES or in
the vicinity of the LEASED PREMISES, (ii) compliant in all respects with local
zoning and/or other municipal ordinances; and (iii) approved in advance in
writing by LANDLORD, which approval shall not be unreasonably withheld,
conditioned or delayed. TENANT at its sole cost and expense shall remove such
sign or signs upon the termination of this Lease. Any defacement or damage to
the Building or the LEASED PREMISES caused by such sign or signs or the
installation or removal thereof shall be repaired promptly by TENANT.

     8.  ASSIGNMENT AND SUBLETTING. TENANT shall not assign, convey, transfer,
sublet, mortgage, encumber or otherwise dispose of all or any portion of its
rights and obligations under this Lease without the prior written consent of the
LANDLORD, which consent may not be unreasonably withheld, conditioned or
delayed. Notwithstanding the foregoing, TENANT may assign, convey, transfer,
sublet or otherwise dispose of all or any portion of its interest in, or its
rights and obligations under, this Lease to any Affiliate of the TENANT. For
purposes of this Paragraph 8, the term "Affiliate" means any entity who,
directly or indirectly, controls or is controlled by or is under common control
with TENANT, whether through the ownership of voting securities or by contract
or otherwise. For this purpose, "control" means the ownership, directly or
indirectly, of at least fifty percent (50%) of the outstanding stock if such
entity is a corporation, or other equity interest if such entity is not a
corporation, or the possession, directly or indirectly, of the power to direct
or cause the direction

                                       15

<PAGE>

of the management and policies of such entity, whether through the ownership of
voting securities or by contract or otherwise. In the event of any permitted
assignment or sublet, TENANT shall nonetheless remain liable for the performance
of all of the obligations of the tenant hereunder.

     9.  CONDITION OF PREMISES.

         (a)  Representations. To induce TENANT to enter this Lease and take
              ---------------
possession of the LEASED PREMISES, LANDLORD hereby represents and warrants to
TENANT as follows:

              (i)    The LEASED PREMISES and the operation thereof complies in
all material respects with all applicable federal, state and local laws,
regulations, codes, orders, ordinances, rules and statutes and any restrictive
covenants applicable to the LEASED PREMISES. LANDLORD has obtained all permits,
approvals and licenses necessary for the Shared Site and the use thereof. The
purposes for which the LEASED PREMISES may be used pursuant to subparagraph 5(a)
are permitted within the zoning classification of the Shared Site or appropriate
zoning relief from such classification has been obtained and is in effect.

              (ii)   The improvements and Fixtures included in the LEASED
PREMISES have been kept and maintained in good working order and condition and
will be in such condition as of the Commencement Date.

              (iii)  As of each delivery date, each portion of space comprising
the LEASED PREMISES (A) will have been decommissioned in accordance with all
applicable Laws, including Environmental Laws, and in accordance with DuPont's
PSGs, (B) decontaminated in accordance with the procedures set forth on Exhibit
"F," and (C) to LANDLORD's knowledge, will not contain any lead-based paint,
asbestos or asbestos containing materials, polychlorinated biphenyls or urea
formaldehyde foam insulation.

         (b)  No Alterations. TENANT acknowledges that LANDLORD has no
              --------------
obligation to alter, remodel or improve the LEASED PREMISES and that LANDLORD's
obligations are limited to delivering the LEASED PREMISES to TENANT in the
condition specified in subparagraph (a) above.

         (c)  Joint Inspection. At the time of occupancy, TENANT shall inspect
              ----------------
and execute the "Chemical Laboratory Final Check List," a copy of which has been
provided to TENANT, to acknowledge the condition of laboratory space.

     10. ALTERATIONS.

         (a)  General Provisions. TENANT shall have no right to make any
              ------------------
alterations, installations, changes and improvements whatsoever in and upon the
LEASED PREMISES without the prior written consent of LANDLORD, which consent
shall not be unreasonably withheld, conditioned or delayed; provided, however,
that TENANT shall have the right to make

                                       16

<PAGE>

those initial alterations for TENANT's occupancy which are more particularly
identified on Exhibit "D" attached hereto and made a part hereof.

         (b)  Rights of Removal. Upon termination or expiration of this Lease or
              -----------------
at any time during the continuance hereof (but provided that no Event of Default
shall have occurred and be continuing hereunder), (i) TENANT shall have the
right to remove from the LEASED PREMISES any articles of personal property or
trade fixtures made or installed by TENANT (which does not include any hoods,
duct work, stacks, blowers, casework and any other generic laboratory equipment
that are existing on the date hereof which may be deemed to be trade fixtures
(collectively, "Excluded Trade Fixtures"), and (ii) except as otherwise agreed
in writing by the parties, TENANT shall have the right to remove from the LEASED
PREMISES any alterations, installations, changes, improvements or other
property, including fixtures (other than Excluded Trade Fixtures), made or
installed by TENANT whether or not constituting or becoming a part of the LEASED
PREMISES and whether made or installed under subparagraph 10(a) or otherwise;
provided that, in the case of both clause (i) and clause (ii) above, any damage
caused by such removal will be fully repaired by TENANT at TENANT's sole cost
and expense prior to surrender of the LEASED PREMISES.

         (c)  Obligation to Remove. Upon termination or expiration of this
              --------------------
Lease, (i) LANDLORD shall have the right to require TENANT to remove from the
LEASED PREMISES all articles of TENANT's property, whether fixtures or
personalty, other than any alterations, installations, changes or improvements
made by TENANT to the LEASED PREMISES in accordance with the provisions of
subparagraph 10(a) hereof, whether or not the same have become an actual part
thereof, and any damage caused by any such removal will be fully repaired by
TENANT at TENANT's sole cost and expense prior to the surrender of the LEASED
PREMISES, and (ii) in the event TENANT fails to remove any property from the
LEASED PREMISES as and when required by LANDLORD in accordance with clause (i)
of this subparagraph 10(c), LANDLORD shall have the right to (x) remove,
transport and dispose of same (without taking title or ownership thereto); and
(y) fully repair any damage caused by such removal, and TENANT shall indemnify
and hold harmless LANDLORD for any costs, expenses or liabilities whatsoever
associated with such removal, transportation and disposal and any such repair
(other than to the extent any such costs, expenses or liabilities arise from the
gross negligence, recklessness or willful misconduct of LANDLORD in performing
such activities).

         (d)  Abandonment. Any alterations, installations, changes, improvements
              -----------
or other property which TENANT has placed on the LEASED PREMISES and which is
not removed within sixty (60) days following the termination or expiration of
this Lease shall be deemed to have been abandoned by TENANT and shall become the
property of LANDLORD upon the termination or expiration of this Lease, subject
to LANDLORD's rights to remove, transport and dispose of same (without taking
title or ownership thereto) at TENANT's sole cost and expense as set forth in
subparagraph 10(c) hereof.

         (e)  Compliance with Laws. Any alterations, additions or improvements
              --------------------
made by TENANT shall be made in accordance with applicable federal, state,
county and local laws and ordinances and building codes, rules and regulations.

     11. MAINTENANCE AND REPAIRS.

                                       17

<PAGE>

         (a)  TENANT's Responsibilities. TENANT, at its own cost and expense,
              -------------------------
shall keep the interior of the LEASED PREMISES and all improvements made by
TENANT in good order and shall be responsible for the full cost of the repair to
any such item, unless it is a repair for which LANDLORD is responsible under
subparagraph 11(b) below.

         (b)  LANDLORD's Responsibilities. LANDLORD shall keep in good order,
              ---------------------------
condition and repair and replace when necessary the structural portions of each
building included in the LEASED PREMISES, the roof and roof membrane,
foundations, appurtenances, heating, ventilation and air conditioning equipment,
electrical systems, plumbing systems, lighting, storm drainage and other
mechanical systems of the Building, exterior walls and windows of the Building
and utility and sewer pipes serving the Building. LANDLORD shall also perform
all routine maintenance required at each building included in the LEASED
PREMISES, including without limitation painting, repairing broken glass and
ordinary maintenance of all such building components. LANDLORD shall also be
responsible for repairing any damage to the LEASED PREMISES caused by leaks in
the roof, bursting pipes (by freezing or otherwise) or by defects in any
building. LANDLORD shall keep all roads and sidewalks on the Shared Site in a
neat and clean condition and promptly remove all dirt, trash, snow and ice
therefrom.

         If LANDLORD fails to make any repairs required by this Lease within
fifteen (15) days of LANDLORD's receipt of written notice from TENANT of need
therefor (except in the event of an emergency in which case TENANT shall only
have to wait a period of time that is reasonable under the circumstances), and
if such failure materially interferes with TENANT's use and enjoyment of the
LEASED PREMISES, TENANT may make such repairs and offset the cost thereof
against base rent and other amounts due under this Lease and may recover the
amount thereof from LANDLORD in addition to any other legal or equitable
remedies TENANT may have. Notwithstanding the foregoing, if LANDLORD shall have
commenced to make such repairs within such fifteen (15) day period (or shorter
period in the event of an emergency) and shall be diligently pursuing the
completion thereof, TENANT shall not have the right to make such repairs and
recover the cost of doing so from LANDLORD unless LANDLORD ceases to diligently
pursue the completion thereof.

     12. LIABILITY. LANDLORD in no event shall be liable for any damage or
injury to TENANT or any agent, employee or invitee of TENANT, or to any person
or persons coming upon the LEASED PREMISES in connection with the occupancy by
TENANT or otherwise, or to any goods, chattels, or other property of TENANT or
any other person or persons which may during the term of this Lease be located
in LEASED PREMISES, which damage or injury has been caused or contributed to by
water, rain, snow, breakage of pipes, leakage, casualty (including, without
limitation, any damage resulting from a casualty of the nature insured against
under a comprehensive policy of property insurance with extended coverage
riders) or by any other cause beyond LANDLORD's control, except when caused by
the gross negligence, recklessness or willful misconduct of LANDLORD, its
invitees, agents or employees. Nothing in this subparagraph 12(a) is intended to
limit or otherwise affect LANDLORD's indemnity obligations to TENANT relating to
environmental matters as provided in subparagraph 5(g) of this Lease.

     13. ACCESS TO LEASED PREMISES. TENANT shall permit LANDLORD to enter upon
the LEASED PREMISES at all times in an emergency and otherwise at all reasonable

                                       18

<PAGE>

times upon reasonable notice (which shall mean at least 48 hours prior notice)
for the purpose of inspecting the same and/or providing services pursuant to
Paragraph 6 and the Shared Utilities and Ancillary Rent Services Exhibit and/or
maintenance or making repairs pursuant to subparagraph 11(a) hereof, and/or
making improvements or replacements pursuant to subparagraph 11(b) hereof and/or
making any repairs or rebuilding under Paragraph 14 hereof.

     14. CASUALTY.

         (a)  Non-Material Casualty. In the event that fire or other casualty
              ---------------------
damages the LEASED PREMISES to an extent that does not materially interfere with
TENANT's use thereof as permitted under subparagraph 5(a) hereof, LANDLORD shall
repair the LEASED PREMISES promptly after such casualty at its sole cost and
expense.

         (b)  Material Casualty. In the event that fire or other casualty
              -----------------
damages the LEASED PREMISES to an extent that materially interferes with
TENANT'S use thereof as permitted under subparagraph 5(a) hereof, LANDLORD shall
proportionately reduce the rent due hereunder during the period of material
interference, and LANDLORD shall have the option, in its sole discretion, of
rebuilding or repairing the LEASED PREMISES at its sole cost and expense;
provided, however, that LANDLORD shall rebuild or repair the LEASED PREMISES if
such rebuilding or repairs are reasonably estimated as being capable of
rebuilding or repair for less than $100,000.00. If LANDLORD is not required and
elects not to rebuild or repair the LEASED PREMISES and continued occupancy
thereof is otherwise lawful, LANDLORD shall so inform TENANT and TENANT may (i)
vacate the part of the LEASED PREMISES rendered unusable by the fire or other
casualty and continue to occupy the remainder of the LEASED PREMISES and to pay
the proportionately reduced rent, or (ii) promptly quit the LEASED PREMISES by
notifying LANDLORD in writing of TENANT's election to terminate this Lease and
thereafter this Lease shall terminate as of the effective date of such notice
and TENANT shall be entitled to a refund for any unearned rent paid or credited
in advance to LANDLORD. If LANDLORD elects not to rebuild the LEASED PREMISES
and continued occupancy thereof is unlawful, LANDLORD shall so inform TENANT,
and TENANT shall promptly quit the LEASED PREMISES at which time this Lease
shall terminate and TENANT shall be entitled to a refund for any unearned rent
paid or credited in advance to LANDLORD. If LANDLORD is not required but does
elect to rebuild or repair, LANDLORD shall notify TENANT within thirty (30) days
of learning of the casualty of its intention to rebuild or repair, which notice
shall provide TENANT with LANDLORD's good faith estimate of the time needed to
complete the rebuilding or repairing, and this Lease shall remain in full force
and effect (with the rent proportionately reduced until such rebuilding or
repairing is complete); provided, however, that in the event that (i) LANDLORD's
reasonable estimate indicates that rebuilding or repairing would take longer
than six (6) months, or (ii) rebuilding or repairing in fact takes longer than
six (6) months, TENANT may thereupon quit the LEASED PREMISES and within five
(5) days after vacating the LEASED PREMISES notify LANDLORD in writing of
TENANT's election to terminate this Lease, in which case this Lease shall
terminate as of the date of LANDLORD's receipt of such notice and TENANT shall
be entitled to a refund for any unearned rent paid or credited in advance to
LANDLORD. If TENANT fails to notify LANDLORD of TENANT's election to quit the
LEASED PREMISES in accordance with this Paragraph 14, TENANT shall be liable for
rent accruing to the date of LANDLORD's actual knowledge of TENANT's vacation or
impossibility of further occupancy. Notwithstanding any other provision to the

                                       19

<PAGE>

contrary, LANDLORD shall have the right to retain any and all insurance proceeds
regardless of its decision regarding rebuilding or repairing the LEASED
PREMISES.

         (c)  TENANT shall bear the risk of loss for all its personal property
(and all personal property of its employees and invitees) including improvements
and fixtures within the LEASED PREMISES.

         15. ADDITIONAL INDEMNITY.

         (a)  TENANT Indemnity. Except as otherwise herein provided (including,
              ----------------
without limitation, as provided in subparagraph 5(g) hereof), TENANT, promptly
following demand by LANDLORD, shall indemnify and hold LANDLORD safe and
harmless from and against any and all Losses (i) on account of the death of or
injury to any person or persons or the damage to or destruction of any property
arising from or growing out of TENANT's use and occupancy of the LEASED PREMISES
or (ii) resulting from any failure by TENANT to perform or observe any covenant
or agreement to be performed or observed by TENANT under this Lease, but only to
the extent such Losses are not caused by the gross negligence or willful
misconduct of LANDLORD. The provisions of this subparagraph 15(a) shall
expressly survive the expiration or earlier termination of this Lease.

         (b)  LANDLORD Indemnity. LANDLORD, promptly following demand by TENANT,
              ------------------
shall indemnify and hold TENANT safe and harmless from and against any and all
Losses (i) on account of the death of or injury to any person or persons or the
damage to or destruction of any property arising from or growing out of
LANDLORD's use and occupancy of the Shared Site other than the LEASED PREMISES
(including without limitation the portion of Building 300 not occupied by
TENANT) or (ii) resulting from any failure by LANDLORD to perform or observe any
covenant or agreement to be performed or observed by LANDLORD under this Lease,
but only to the extent such Losses are not caused by the gross negligence or
willful misconduct of TENANT. Nothing in this subparagraph 15(b) is intended to
limit or otherwise affect LANDLORD's indemnity obligations to TENANT relating to
environmental matters as provided in subparagraph 5(g) of this Lease. The
provisions of this subparagraph 15(b) shall expressly survive the expiration or
earlier termination of this Lease.

         (c)  Limitations. All indemnity obligations of LANDLORD and TENANT
              -----------
arising under this Lease, and all claims, demands, damages and losses assertable
by LANDLORD and TENANT against the other in any suit or cause of action arising
out of or relating to this Lease, the LEASED PREMISES or the Shared Site, or the
use and occupancy thereof, are limited as follows:

              (i)    By the releases and waivers expressed herein, including,
without limitation, the mutual releases and waivers of rights set forth in
Paragraph 12 above and subparagraph 20(d) below;

              (ii)   All claims for indemnification and other recoveries shall
be limited to direct, proximately caused damages and exclude all consequential
or indirect damages, including, but not limited to, business loss or
interruption, suffered by the party asserting the claim or seeking the recovery;
and

                                       20

<PAGE>

              (iii)  In the event that LANDLORD and TENANT (or the persons for
whom they are liable as expressly set forth herein) are determined to be
contributorily responsible for the indemnified injury or loss, each indemnitor's
obligation shall be limited to the indemnitor's equitable share of the losses,
costs or expenses to be indemnified against based on the relative culpability of
each indemnifying person whose negligence or misconduct contributed to the
injury or loss.

     16. EVENTS OF DEFAULT AND REMEDIES.

         (a)  General. If TENANT (i) fails to pay any base rent or Additional
              -------
Rent when due and payable hereunder or under the Shared Utilities and Ancillary
Rent Services Exhibit and such failure continues for a period of ten (10) days
after written notice thereof is given to TENANT by LANDLORD, or (ii) fails to
perform or observe any other covenant or agreement set forth in this Lease in
accordance with the terms hereof and such failure continues for a period of
thirty (30) days after written notice thereof is given to TENANT by LANDLORD,
then, in either of such events, if so declared in writing by LANDLORD, such
event or circumstance shall constitute an "Event of Default" Notwithstanding the
foregoing, in the case of failure described in clause (ii) of the preceding
sentence, if the failure cannot with due diligence be cured within thirty (30)
days from and after the giving of notice by LANDLORD as aforesaid, and if TENANT
commences to cure such failure and proceeds diligently and with reasonable
dispatch to take such steps and do such work as may reasonably be required to
cure such failure, then LANDLORD shall not have the right to declare an Event of
Default.

         (b)  Additional Events of Default. Any of the following shall also
              ----------------------------
constitute an Event of Default: (i) TENANT is adjudicated a bankrupt, (ii)
TENANT institutes proceedings for a reorganization or for an arrangement under
the bankruptcy laws of the United States codified as Title 11 of the United
States Code ("Bankruptcy Act") or (iii) an involuntary petition in bankruptcy is
filed against TENANT under the Bankruptcy Act, which is not dismissed or vacated
within ninety (90) days.

         (c)  Remedies. Upon the occurrence of an event or circumstance
              --------
constituting an Event of Default under subparagraph 16(b), or the declaration of
an Event of Default under subparagraph 16(a), LANDLORD (i) shall have the right,
upon the giving of five (5) days' advance written notice to TENANT, to terminate
this Lease and if such Event of Default shall not have been cured by TENANT
within such five (5) day period, this Lease shall terminate and expire at
midnight on such fifth day and (ii) shall have all other rights and remedies
provided by law or in equity.

     17. EMINENT DOMAIN. If the whole or any part of the LEASED PREMISES shall
be taken by any public authority under the power of eminent domain such as to
materially interfere with TENANT's use thereof as permitted under Paragraph 5(a)
hereof, then the terms of this Lease shall cease on the part so taken on the
date possession of that part is surrendered, and from that day TENANT shall have
the right either (i) to cancel this Lease and declare the same null and void,
giving written notice to LANDLORD of same, and to be entitled to any unearned
rent paid or credited in advance, or (ii) to continue in possession of the
remainder of the LEASED PREMISES under the terms herein provided, giving written
notice to LANDLORD of same, except that the base rent and TENANT'S SHARE shall
be equitably adjusted by

                                       21

<PAGE>

LANDLORD and TENANT as may be appropriate in light of the portions of the
Building taken in such proceeding. Notwithstanding anything to the contrary
contained herein, TENANT shall not be entitled to share in any portion of the
award in respect of such taking.

     18. SUBORDINATION. LANDLORD hereby represents to TENANT that there are no
mortgages, judgments or liens encumbering the Shared Site. If requested by
LANDLORD from time to time hereafter, TENANT shall subordinate its interest in
the LEASED PREMISES to the lien, operation and effect of any mortgage created by
LANDLORD, provided that such subordination shall include or be accompanied by a
commercially reasonable form of nondisturbance agreement under which the
mortgagee agrees that, in the event of a mortgage foreclosure or conveyance in
lieu of foreclosure or otherwise, this Lease shall continue as a Lease between
LANDLORD's successor, as landlord, and TENANT, as tenant, with the same force
and effect as if LANDLORD's successor and TENANT had entered into a Lease
containing the same terms, covenants and conditions as those contained in this
Lease, including the rights of renewal thereof for a term equal to the unexpired
term of this Lease.

     19. SURRENDER. On or before the Expiration Date or prior termination of
this Lease, TENANT shall peaceably surrender the LEASED PREMISES, and the LEASED
PREMISES shall be turned over to LANDLORD (i) in substantially the condition
existing on the date of this Lease (ordinary wear and tear, damage by casualty
and repairs that are LANDLORD's responsibility hereunder excepted), (ii) in
compliance with the conditions and requirements specified in subparagraphs 5(f),
5(g), 10(b) and 10(c) and in Paragraph 7, (iii) having been decommissioned in
accordance with all applicable Laws, including Environmental Laws, and in
accordance with DuPont's PSGs, and (iv) having been decontaminated in accordance
with the procedures set forth on Exhibit "F." Any personal property remaining
within the LEASED PREMISES after termination shall be treated as provided for in
Paragraph 10 hereof.

     20. INSURANCE.

         (a)  TENANT's Insurance. TENANT shall obtain and keep in effect during
              ------------------
the term of this Lease, from one or more reputable insurance companies licensed
to do business in the State of Delaware:

              (i)    Comprehensive general liability insurance policy
(Occurrence Form), including Blanket Contractual Liability, Product/Completed
Operations, Broad Form Property Damage, and Personal Injury in a combined single
limit for Bodily Injury and Property Damage not less than $2,000,000 per
occurrence. Such policy shall name LANDLORD as an additional insured and shall
contain a waiver of subrogation in favor of LANDLORD. Each such policy shall
contain a thirty (30) day prior written notice provision to LANDLORD prior to
any such cancellation or termination. TENANT may provide its insurance coverage
for the LEASED PREMISES through a blanket or umbrella policy.

              (ii)   Workers' Compensation - Statutory; Employer's Liability -
$1,000,000 per accident/per employee; and such other generic insurance as may be
required by law.

                                       22

<PAGE>

              (iii)  Business Auto Liability, in a combined single limit for
Bodily Injury and Property Damage - $1,000,000 per occurrence.

         TENANT shall further file a certificate of insurance evidencing the
above required minimum coverage with LANDLORD's designee. Neither the failure of
TENANT to comply with any or all of the insurance provisions of this Lease, nor
the failure to secure endorsements on policies as may be necessary to carry out
the terms and provisions of this Lease, shall be construed to limit or relieve
TENANT from any of its obligations under this Lease, including this insurance
paragraph.

         (b)  LANDLORD's Insurance. LANDLORD shall either obtain and keep in
              --------------------
effect fire and extended coverage casualty insurance ("Casualty Insurance") in
the amount of the full replacement cost of the LEASED PREMISES or, if permitted
by subparagraph 20(c) below, establish a self-insurance program in lieu of
obtaining third party insurance in accordance with the requirements of
subparagraph 20(c). Neither the failure of LANDLORD to comply with any or all of
the insurance provisions of this Lease, nor the failure to secure endorsements
on policies as may be necessary to carry out the terms and provisions of this
Lease, shall be construed to limit or relieve LANDLORD from any of its
obligations under this Lease, including this insurance paragraph.

         (c)  Self-Insurance. Notwithstanding anything to the contrary contained
              --------------
herein, for so long as (i) E.I. du Pont de Nemours and Company is the LANDLORD
hereunder, (ii) E.I. du Pont de Nemours and Company has a net worth in excess of
$2,000,000,000, and (iii) E.I. du Pont de Nemours and Company has an investment
grade credit rating from each of the nationally recognized rating agencies then
rating its debt, LANDLORD may self-insure in lieu of obtaining or keeping in
effect third party insurance (including, without limitation, Casualty Insurance)
relating to the Shared Site, including the LEASED PREMISES.

         (d)  Release and Waiver of Subrogation. Any provision of this Lease to
              ---------------------------------
the contrary notwithstanding, LANDLORD and TENANT hereby release the other from
any and all liability or responsibility to the other or anyone claiming through
or under them by way of subrogation or otherwise (a) from any and all liability
for any loss or damage to the property of the releasing party, (b) for any loss
or damage that may result, directly or indirectly, from the loss or damage to
such property (including rental value and business interruption), and (c) from
legal liability for any loss or damage to property (no matter who the owner of
the property may be), all to the extent that the releasing party's loss or
damage is insured or, if not insured, was insurable under commercially available
fire and extended coverage property insurance policies, including additional
coverages typically obtained by owners and tenants of comparable premises, even
if such loss or damage or legal liability shall be caused by or result from the
fault or negligence of the other party or anyone for whom such party may be
responsible and even if the releasing party is self insured in whole or in part
or the amount of the releasing party's insurance is inadequate to cover the loss
or damage or legal liability. It is the intention of the parties that LANDLORD
and TENANT shall look solely to their respective insurance carriers or
self-insurance programs for recovery against any such property loss or damage or
legal liability, without (in the case of third party coverage) such insurance
carriers having any rights of subrogation against the other party.

                                       23

<PAGE>

     21. QUIET ENJOYMENT. LANDLORD warrants its right to create the leasehold
interest created herein and covenants that TENANT, upon paying the rent and all
other sums and charges to be paid by it under this Lease, and observing and
keeping all covenants, agreements and conditions of this Lease on its part to be
kept, shall have peaceful, quiet and uninterrupted possession of the LEASED
PREMISES during the term of this Lease, including any Renewal Term.

     22. MAINTENANCE OF RECORDS/INSPECTION. LANDLORD shall maintain or cause to
be maintained in the ordinary course of business, books and records relating to
its calculation of rent due hereunder and the costs of water, sewer and electric
charged to TENANT hereunder. LANDLORD shall make such records available for
inspection by TENANT during regular business hours and upon reasonable notice
(or by an independent accountant or other designee of TENANT to which LANDLORD
does not have reasonable objection); provided, however, that any such inspection
by TENANT shall not occur more than once each calender quarter and shall be
conducted in a manner which does not interfere unreasonably with the operation
of the day-to-day business affairs of LANDLORD.

     23. JURISDICTION; FORUM; ETC. Any controversy, claim or issue arising out
of or relating to either party's performance under this Lease or the
interpretations, validity or effectiveness of this Lease shall, upon the written
request of either party, be referred to designated senior management
representatives of LANDLORD and TENANT for resolution. Such representatives
shall promptly meet and, in good faith, attempt to resolve the controversy,
claim or issue referred to them. If TENANT and LANDLORD cannot so resolve such
controversy, claim or issue, then upon written notice from either party within
the next sixty (60) days, the parties will attempt in good faith to resolve the
dispute through mediation to be held in Wilmington, Delaware, unless the parties
otherwise agree upon another location. If the controversy, claim or issue is not
resolved through mediation, then such controversy, claim or issue shall be
settled by binding arbitration before the American Arbitration Association
("AAA") to be held in Wilmington, Delaware, unless the parties otherwise agree
upon another location. Such arbitration shall be conducted in accordance with
AAA's then current Commercial Arbitration Rules. The award rendered by the
arbitrator or arbitrators shall be final and unappealable, and judgment may be
entered upon the award in accordance with applicable law in any Court having
jurisdiction thereof. The non-prevailing party in such arbitration shall be
required to reimburse the prevailing party its reasonable attorneys' fees and
costs incurred in such arbitration and any action to enter judgment upon the
arbitration award.

     24. NOTICES. All notices, requests, claims, demands and other
communications hereunder shall be in writing and shall be deemed to have been
duly given if delivered personally, telecopied (which is confirmed) or sent by
registered or certified mail (postage prepaid, return receipt requested) or by a
nationally recognized overnight delivery service to the parties at the following
addresses:

              If to TENANT, to:

              Incyte Genomics Inc.
              3160 Porter Drive
              Palo Alto, CA 94304

                                       24

<PAGE>

              Attn.:   Robin Weckesser

              With a courtesy copy to:

              Incyte Genomics Inc.
              3160 Porter Drive
              Palo Alto, CA 94304
              Attn.:   General Counsel

              If to LANDLORD, to:

              E.I. du Pont de Nemours and Company
              1007 Market Street
              Wilmington, DE  19898
              Attn: Corporate Real Estate.
                    Room: D-12090

or to such other address as LANDLORD or TENANT may specify by notice to the
other (provided that notice of any change of address shall be effective only
upon receipt thereof).

     25. CORPORATE COVENANTS AND REPRESENTATIONS. Each person executing this
Lease on behalf of LANDLORD and TENANT hereby covenants and warrants that
LANDLORD or TENANT, as applicable, is a duly constituted corporation qualified
to do business in the State of Delaware and that such person is duly authorized
to execute and deliver this Lease on behalf of TENANT.

     26. INTEGRATION. This Lease and the documents referred to herein set forth
all the agreements, conditions and understandings between LANDLORD and TENANT
relative to the LEASED PREMISES, and there are no promises, agreements,
conditions or understandings, either oral or written, between them other than
that certain Confidentiality Agreement dated February 5, 2002 by and between
them (which agreement may be amended from time to time). No subsequent
alteration, amendment, supplement, change or addition to this Lease shall be
binding upon LANDLORD or TENANT unless reduced to writing and signed by both
parties hereto.

     27. NO PARTNERSHIP. The parties do not intend to create any partnership or
joint venture between themselves with respect to the LEASED PREMISES or any
other matter. In all matters relating to this Lease, both parties will be acting
solely as independent contractors and will be solely responsible for the acts of
their employees, officers, directors, contractors and agents. Employees, agents,
or contractors of one party shall not be considered employees, agents, or
contractors of the other party. Neither party shall have the right, power, or
authority to create any obligation, express or implied, on behalf of the other
party.

     28. GOVERNING LAW. This Lease shall be governed by and construed in
accordance with the laws of the State of Delaware, regardless of the laws that
might otherwise govern under applicable principles of conflicts of laws.

                                       25

<PAGE>

     29. HEADINGS. The descriptive headings herein are inserted for convenience
of reference only and are not intended to be part of or to affect the meaning or
interpretation of this Lease.

     30. SEVERABILITY. The invalidity or unenforceability of any provision of
this Lease shall not affect the validity or enforceability of any other
provisions of this Lease, each of which shall remain in full force and effect.

     31. SUCCESSION. This Lease shall be binding upon and inure to the benefit
of the parties hereto and their respective successors and permitted assigns.

     32. COUNTERPARTS. This Lease may be executed in two or more counterparts,
each of which shall be deemed to be an original, but all of which shall
constitute one and the same agreement.

     33. INTERPRETATION.

         (a)  Reference to any law, or to any provision of any law, in this
Lease shall include any modification or reenactment of that legislation or
legislation substituted therefor and all legislation, orders, regulations and
amendments issued under such legislation.

         (b)  Reference to any party shall include a reference to its legal
successors and permitted assignees.

     34. BROKERS. LANDLORD covenants, represents and warrants to TENANT that
LANDLORD has had no dealing or negotiations with any broker or agent or finder
in connection with respect to this Lease other than CRESA Partners and CB
Richard Ellis (collectively, the "Brokers"). TENANT covenants, represents and
warrants to LANDLORD that TENANT has had no dealing or negotiations with any
broker or agent or finder in connection with respect to this Lease other than
the Brokers. LANDLORD shall pay the Brokers any commission or other fees due in
connection with the Lease pursuant to separate agreements. LANDLORD and TENANT
each covenant and agree to pay, hold harmless and indemnify the other from and
against any and all costs, expenses, including reasonable attorneys' fees, and
liability for any compensation, commissions or charges claimed by any other
broker or agent with whom the indemnifying party has had any dealings or
negotiations with respect to this Lease.

     35. FORCE MAJEURE. "Force Majeure" means, for either party, any
circumstance(s) beyond the reasonable control of that party, which prevents full
performance of an obligation hereunder. For the avoidance of doubt, the
following circumstances shall also constitute a Force Majeure event: failure by
a third party to supply (in whole or in part) any utilities or ancillary rent
service to the extent that such failure prevents, hinders or delays LANDLORD's
ability to provide that utility or ancillary rent service to TENANT; a
Governmental Authority notifies LANDLORD or commences a legal or administrative
action alleging that provision of a utilities or ancillary rent services results
in LANDLORD being deemed a public utility. The party affected by an event
constituting Force Majeure shall be excused from performance of its obligations
under or pursuant to this Lease if, and to the extent that, performance of such
obligations is delayed, hindered or prevented by such Force Majeure.

                                       26

<PAGE>

A Force Majeure may excuse a delay in making any payment due hereunder
where the delay in payment was caused by the Force Majeure, but otherwise the
parties shall continue to make payments due hereunder for the remaining
utilities or ancillary rent services provided hereunder. If a party is in a
position of Force Majeure or is aware of the likelihood of a situation
constituting Force Majeure arising, it shall notify the other party in writing
promptly of the cause and extent of such non-performance or likely
non-performance, the date or likely date of commencement thereof and the means
proposed to be adopted to remedy or abate the Force Majeure, and the parties
shall consult with a view to take such steps as may be appropriate to mitigate
the effects of such Force Majeure. If any such Force Majeure continues for more
than fifteen (15) days and materially interferes with TENANT's use and enjoyment
of the LEASED PREMISES , LANDLORD shall proportionately reduce the rent due
hereunder during the period of material interference.

     36. SURVIVAL. The expiration or termination of this Lease shall not affect
any rights or obligations that have arisen or accrued hereunder before such
expiration or termination.

     37. CONFIDENTIALITY. The cost of utilities and services is confidential
business information. It and any other exchange of confidential information
shall be governed by the February 5, 2002 Confidentiality Agreement between the
parties, as amended from time to time.

     38. DATA TRANSFER AND PRIVACY. Unless otherwise agreed by the parties in
writing, any personal information provided by one party to the other hereunder
may only be used for conducting the transactions that are the subject of this
Lease. Personal information means any information by which the identity of a
person could be revealed. Examples of personal information include, but are not
limited to, name, address, telephone number, date of birth, social security
number, e-mail address or any combination thereof.

     39. NON-SOLICITATION OF DUPONT EMPLOYEES. During the term of the Lease,
TENANT will not recruit or solicit for employment any of LANDLORD's current
employees.

                                       27

<PAGE>

     IN WITNESS WHEREOF, the parties hereto have caused this Lease to be
executed as of the day and year first above written.

     Witness:                   E. I. DU PONT DE NEMOURS AND COMPANY

     ---------------------      By:    /s/ Diane L. Boc
     Name:                             Name:  Diane L. Boc
     Title:                            Title: Manager Corporate Real Estate U.S.
                                Region

     Witness:                   INCYTE GENOMICS INC.

     ---------------------      By:    /s/ Roy Whitfield
     Name:                             Name:  Roy A. Whitfield
     Title:                            Title: Chairman of the Board

                                       28

<PAGE>

                                    EXHIBIT A

                         DIAGRAM OF LEASED PREMISES AND
                        LEGAL DESCRIPTION OF SHARED SITE

                                  See Attached

                                       A-1

<PAGE>

                                    EXHIBIT B

                                 RENTAL SCHEDULE

Building 300 Space

         Dates                   Square Footage     Rental Rate     Monthly Rent
         -----                   --------------     -----------     ------------

Building 300 Delivery Date
to March 15, 2003                 32,557 RSF         $35.00/RSF     $  94,957.92

March 16, 2003 to
Expiration Date                   32,557 RSF         $36.05/RSF     $  97,806.65

Renewal Terms                     32,557 RSF         $37.13/RSF     $ 100,736.78

Building 112

         Dates                    Square Footage     Rental Rate    Monthly Rent
         -----                    --------------     -----------    ------------

Building 112 Delivery Date
to March 15, 2003                 14,415 RSF         $35.00/RSF     $  42,043.75

March 16, 2003 to
Expiration Date                   14,415 RSF         $36.05/RSF     $  43,305.06

Renewal Terms                     14,415 RSF         $37.13/RSF     $  44,602.41

                                      B-1

<PAGE>

                                    EXHIBIT C

                     DUPONT'S PSGs AND RULES AND REGULATIONS

1)   DuPont's PSGs are included in the two (2) volume three-ring binders
     entitled "Corporate Policies, Standards and Guidelines; Safety, Health and
     Environmental Manual", dated December 2000, separately delivered to TENANT.

2)   For the purposes of this Lease, the "Rules and Regulations" shall consist
     of the following, each of which have been separately delivered to TENANT:

          .   Procedure 22-1, Air Permitting, 4/1/01

          .   Procedure 22-2, Waste Management and Disposal, 3/31/99

          .   Procedure 22-3, Sewers and Groundwater Protection, 3/1/01

          .   DuPont Facilities Services & Real Estate, Waste Guide,
              Version 4.4, 1/10/02

                                      C-1

<PAGE>

                                    EXHIBIT D

                     APPROVED INITIAL ALTERATIONS BY TENANT

                                  See Attached

                                      D-1

<PAGE>

                                    EXHIBIT E

                  SHARED UTILITIES AND ANCILLARY RENT SERVICES

I.     Utilities or Ancillary Services Included in Base Rent

1.  SITE ADMINISTRATION
2.  PROPERTY TAXES
3.  BUILDING MAINTENANCE (including facilities engineering support and
    janitorial)
4.  ROADS AND GROUNDS MAINTENANCE; SNOW REMOVAL
5.  ROUTINE SITE SECURITY
6.  MATERIALS HANDLING;
7.  SITE MAIL SERVICE
8.  BUILDING HEAT
9.  EMERGENCY RESPONSE PROGRAM COORDINATION
10. AIR PERMIT SUPPORT

Terms of Service:

1. SITE ADMINISTRATION

Description: Provide site management services to insure continuity of site and
TENANT operations. The site management team will interact with site residents to
be sure all site activities and facility infrastructures are aligned with
business goals and operations. The site management function also as the external
community spokesperson for the Stine-Haskell Research Center. The services
include the remaining services described in this Section I.

2. PROPERTY TAXES

Description: Provides management and payment of the charges related to site
building depreciation and property taxes. Depreciation rates are set by LANDLORD
based on corporate standards and determined by the current level of investment.
Local governments levy property taxes and payments are administered by LANDLORD
Finance Tax Section.

3. BUILDING MAINTENANCE

Description:

Routine Maintenance - Provides routine building maintenance services.
Installation of new services and equipment is normally the financial
responsibility of the resident. Building maintenance services may include:
asbestos abatement, electrical maintenance, fire & life safety systems
maintenance, plumbing, HVAC operation & maintenance, roof maintenance, vertical
transportation maintenance, & facilities engineering.

                                      E-1

<PAGE>

Facilities Engineering - Point of contact to provide technical assistance to
building maintenance, HVAC and power/utility operations for buildings at the
Stine-Haskell Research Center, including the development and implementation of
preventive/predictive maintenance programs, energy conservation and benchmarking
studies.

Janitorial - Provide janitorial service per "2001/2002 Janitorial Specifications
For Stine-Haskell" guidelines. Janitorial service is provided at offices,
laboratories, and warehouses. utilities or ancillary rent services included:
office and lab cleaning, common area cleaning (conference rooms, hallways,
corridors and stairways) and carpet cleaning. Also included under janitorial
service is pest control, ash hauling, interior and exterior window cleaning.

4. ROADS AND GROUNDS; SNOW REMOVAL

Description: Provide roads and grounds maintenance service to office and
laboratory residents. The services provided include:

- Roads/Parking Lots/Sidewalks:
-       Perform annual inspection of parking areas, sidewalks, paved surfaces
        and striping
-       Repair, replace or refinish as needed
-       Provide road and parking lot striping
-       Clean all areas as needed

- Landscaping:
-       Ground maintenance
-       Mowing
-       Edging
-       Pruning (trees and bushes)
-       Trash clean-up including between buildings and shed areas
-       Weeding beds

- Mulching/edge beds

- Leaf removal

- Flower planting and maintenance

- Lawn repair and seeding

- Shrub replacement

- Storm damage and clean-up

- Snow Removal:

-       Clear parking lots/sidewalks/roadways of snow or ice, as needed
-       Sand or ice melt application to all areas as needed

                                      E-2

<PAGE>

-       Sand clean-up
-       Street drain cleaning

5. ROUTINE SITE SECURITY

Description: Provide site security for the protection of people, property, and
information. utilities or ancillary rent services include: security pass
administration, gate keeping services, routine patrols, incident investigations,
emergency response, maintenance of building life safety systems, and
proactive/preventative security services including:
- Provide 24 hour/day
- 7 days/week site security.
- Conduct safety/security patrols during off-hours within building.
- Provide monthly safety inspections (per standards) of exit lights and
emergency lights. Effect necessary repairs.
- Provide, repair and maintain all building life safety systems per National
Fire Protection Association (NFPA), LANDLORD Engineering Guidelines/Standards
and local code requirements.
- Provide routine traffic audits, with feedback to business management.
- Maintain a well-trained, professional and courteous site security force.

6. MATERIALS HANDLING

Description: Provides centralized shipping, receiving, and distribution of
material and equipment at Stine-Haskell Research Center. This service includes:
- Receipt and shipment of materials such as precious metals, perishables,
radioactive, theft-sensitive items and controlled substances.
- Bar-Coded Package Tracking System - Internet based.
- Freight, claims, and problem package management.
- Delivery of packages to loading docks.
- Delivery of packages to offices.

Note: utilities or ancillary rent services do not include off-site materials
transportation; waste manifests. TENANT may be required to give LANDLORD
appropriate power of attorney to sign shipping/receiving forms on its behalf.

7. SITE MAIL SERVICE

Description: Provides intra-site and external mail services at Stine-Haskell
Research Center. This includes mail to/from the U. S. Postal utilities or
ancillary rent service, intra-company mail including scheduled daily runs for
priority interoffice mail and related distribution services to the various
pickup/delivery points. The contract operator providing the mail service also
manages postage meters and special pickups, which is handled as a demand service
cost. LANDLORD manages the service level and accounting for the mail service
contract. Site Mail utilities or ancillary rent service goals include:
- Deliver and pick up mail twice/day at bulk stops (desk to desk - once/day).
- Delivery of mail within two (2) business days between locations within a site.
- Maintain accurate listing for proper individual mail delivery.

                                      E-3

<PAGE>

8. BUILDING HEAT

LANDLORD will provide environmental comfort (steam) heat to the LEASED PREMISES.

9. SITE. EMERGENCY RESPONSE PROGRAM

Description: LANDLORD coordinates emergency response services for the site. This
includes fire response, medical emergency, spill control and other site
emergency services. This response is closely coordinated with local authorities.

Additional Terms and Conditions:

1.  Site Emergency Response Program Participation:

(a) TENANT will participate in the Site Emergency Response Program to the extent
reasonably requested by LANDLORD, it being the intention of the parties that
such participation by TENANT will be on a basis comparable to the participation
in the Site Emergency Response Program by individual LANDLORD businesses located
at the Stine-Haskell Research Center. It is expected that TENANT's participation
will include, but not be limited to, the assignment by TENANT to the
Stine-Haskell Research Center emergency response team of such number of TENANT's
personnel as the parties may reasonably agree from time to time and the
participation by such personnel in training, fire fighting and other activities
associated with the Site Emergency Response Program.

(b) TENANT personnel shall be subject to LANDLORD's direction while
participating in the Site Emergency Response Program; provided, however, that in
no event shall such personnel be deemed employees of LANDLORD in connection with
or as a result of their participation in the Site Emergency Response Program.

2.  Response:

(a) In the event TENANT requests LANDLORD's assistance hereunder, LANDLORD shall
use all reasonable efforts to provide such assistance as contemplated under the
Site Emergency Response Program (including the provision of emergency first aid
services), utilizing such personnel and equipment as shall be available at the
Stine-Haskell Research Center at that time for that purpose. In the event of
simultaneous emergencies at the TENANT facilities and elsewhere on the
Stine-Haskell Research Center, the Emergency Director of the Stine-Haskell
Research Center shall give priority to the emergency which presents, in his/her
sole judgement, the greatest immediate danger or threat of personal injury,
death or property damage without regard to the location of the emergency.

(b) If LANDLORD provides assistance to TENANT hereunder, LANDLORD shall be
entitled to direct the emergency effort and TENANT shall cooperate fully with
LANDLORD in this regard.

                                      E-4

<PAGE>

10. AIR PERMIT SUPPORT

Executive Summary: LANDLORD will manage the air permitting and record-keeping
requirements for the emissions from laboratory fume hoods and ventilated
enclosures as produced by TENANT at the Stine Haskell Research Center site
("Services"). These Services shall be provided in conjunction with the TENANT's
research and development activities located at the LANDLORD Stine Haskell
Research Center ("SHRC"). LANDLORD services shall be provided, and TENANT shall
provide to LANDLORD its air emissions data, in compliance with applicable law,
related regulations and LANDLORD's own permit and rules ("Compliance"). The
services will be provided for only so long as it is permitted under LANDLORD's
Title V permit.

TENANT Contact:  Leslie O'Rourke Garret

LANDLORD Contacts:

Name              Telephone                 Fax
-----------------------------------------------------------
Angela Jenkins    (302) 695-3821            (302) 774-1143
Charles Leaberry  (302) 695-4032            (302) 774-3508

Scope:  LANDLORD will:

1.  Develop, register, maintain and record TENANT Compliance with air permits
and regulations. Submit environmental reports. Obtain regulatory permits and
permit renewals under LANDLORD's Title V Air Permit.
2.  Provide air pollution modeling to meet Delaware Air toxics requirements, and
conduct other air dispersion modeling as reasonably requested by TENANT.
3.  Develop procedures and provide training so that the TENANT unit proprietor
has the necessary tools to comply with the sites permitting requirements.

Tracking and Reporting: TENANT will be responsible for timely and accurate
biannual certifications as required for Compliance with/deviation from
LANDLORD's Title V permit.

II. Utilities or Ancillary Services Not Included in Base Rent (i.e., Additional
Rent Services)

1) ELECTRICITY
2) WATER AND SEWER

Terms of Service:

LANDLORD will provide electricity, domestic water and sanitary sewer to the
TENANT.

- Between 110-220 volt electricity.
- Domestic water for general use, drinking fountains, chilled water, fire
protection and sanitary purposes.

                                      E-5

<PAGE>

- Sanitary waste water/sewer service, for which the TENANT shall meet all site
discharge requirements and restrictions.

On the Effective Date, the utility provider for the Shared Site for (a)
electricity is Conectiv; (b) domestic water is United Water Delaware and (c)
sanitary sewer is New Castle County. Utilities' availability by TENANT is
subject at all times by the terms and conditions of the LANDLORD's agreement
with these providers.

Electricity and domestic water will be metered based on metered readings to be
charged as a direct pass-through to the TENANT. Sanitary sewer charges will be
based on the TENANT metered water use and charged at the pass through sewer unit
rate per one thousand gallons used. In buildings where the TENANT is not the
sole TENANT, the TENANT will be charged a prorated amount based on the meter
readings for the entire building and their percentage of occupied space in that
building.

Charges for electricity will be invoiced on a monthly basis; water and sanitary
sewer bills will be on a quarterly basis.

                                      E-6

<PAGE>

                                    EXHIBIT F

                           DECONTAMINATION PROCEDURES

..   Chemical Dry (Glove) Box Decontamination Procedure, 2/3/02

..   Chemical Fume Hood Decontamination Procedure, 2/3/02

..   Chemical Laboratory Final Checklist, 2/3/02

..   Lab and Office Checkout Guidance, 2/3/02

..   Occupant Laboratory Move Checklist, 2/3/02

..   Decontamination Procedure for Biosafety Level 2 (or above) Laboratories
    (undated)

                                      F-1<PAGE>

                                                                   EXHIBIT 10.39

                            FORM OF SENIOR MANAGEMENT
                           CHANGE OF CONTROL AGREEMENT

     This Change of Control Agreement (the "Agreement") is made and entered into
effective as of JANUARY 3, 2000 by and between STEVE BACICH (the "Employee") and
Conceptus, Inc., a Delaware corporation (the "Company").

                                    RECITALS

     A. It is expected that another company or other entity may from time to
time consider the possibility of acquiring the Company or that a change in
control may otherwise occur, with or without the approval of the Company's Board
of Directors (the "Board"). TheBoard recognizes that such consideration can be a
distraction to the Employee, an executive officer of the Company, and can cause
the Employee to consider alternative employment opportunities. The Board has
determined that it is in the best interests of the Company and its stockholders
to assure that the Company will have the continued dedication and objectivity of
the Employee, notwithstanding the possibility, threat or occurrence of a Change
of Control (as defined below) of the Company.

     B. The Board believes that it is in the best interests of the Company and
its stockholders to provide the Employee with an incentive to continue his or
her employment with the Company.

     C. The Board believes that it is imperative to provide the Employee with
certain benefits upon a Change of Control and, under certain circumstances, upon
termination of the Employee's employment in connection with a Change of Control,
which benefits are intended to provide the Employee with financial security and
provide sufficient income and encouragement to the Employee to remain with the
Company notwithstanding the possibility of a Change of Control.

     D. To accomplish the foregoing objectives, the Board of Directors has
directed the Company, upon execution of this Agreement by the Employee, to agree
to the terms provided in this Agreement.

     E. Certain capitalized terms used in the Agreement are defined in Section 4
below.

     In consideration of the mutual covenants contained in this Agreement, and
in consideration of the continuing employment of Employee by the Company, the
parties agree as follows:

     1. At-Will EmpIoyment. The Company and the Employee acknowledge that the
Employee's employment is and shall continue to be at-will, as defined under
applicable law. If the Employee's employment terminates for any reason,
including (withoutlimitation) any termination prior to a Change of Control, the
Employee shall not be entitled to any payments or benefits, other than as
provided by this Agreement, or as may otherwise be available in accordance with
the terms of the Company's then existing employee plans and written policies in
effect at the time of termination. The terms of this Agreement shall terminate
upon the earlier of (i) the date on which Employee ceases to be employed as an
executive

                                       1

<PAGE>

officer of the Company, other than as a result of an involuntary
termination by the Company without Cause (ii) the date that all obligations of
the parties hereunder have been satisfied, or (iii) two (2) years after a Change
of Control. A termination of the terms of this Agreement pursuant to the
preceding sentence shall be effective for all purposes, except that such
termination shall not affect the payment or provision of compensation or
benefits on account of a termination of employment occurring prior to the
termination of the terms of this Agreement.

     2. Stock Options. Subject to Sections 5 and 6 below, in the event of a
Change of Control and regardless of whether the Employee's employment with the
Company is terminated in connection with the Change of Control, each stock
option granted for the Company's securities held by the Employee shall become
fully vested and immediately exercisable on the effective date of the
transaction and shall be exercisable to the extent so vested in accordance with
the provisions of the Stock Option Agreement and Stock Option Plan pursuant to
which such stock option was granted.

3.        CHANGE OF CONTROL.

     (a) TERMINATION FOLLOWING A CHANGE OF CONTROL. Subject to Sections 5 and 6
below, if the Employee's employment with the Company is terminated at any time
within two (2) years after a Change of Control, then the Employee shall be
entitled to receive severance benefits as follows:

          (i). VOLUNTARY RESIGNATION. If the Employee voluntarily resigns from
     the Company (other than as an Involuntary Termination (as defined below) or
     if the Company terminates the Employee's employment for Cause (as defined
     below)), then the Employee shall not be entitled to receive severance
     payments. The Employee's benefits will be terminated under the Company's
     then existing benefit plans and policies in accordance with such plans and
     policies in effect on the date of termination or as otherwise determined by
     the Board of Directors of the Company.

          (ii). INVOLUNTARY TERMINATION. If the Employee's employment is
     terminated as a result of an Involuntary Termination other than for Cause,
     the Employee shall be entitled to receive the following benefits: (i)
     severance payments during the period from the date of the Employee's
     termination until the date 18 months after the effective date of the
     termination (the "Severance Period") equal to the salary which the Employee
     was receiving at the time of such termination, which payments shall be paid
     during the Severance Period in accordance with the Company's standard
     payroll practices; (ii) monthly severance payments during the Severance
     Period equal to 1/12th of the Employee's "target bonus" (as defined below)
     for the fiscal year in which the termination occurs (or for the prior
     fiscal year if a target bonus has not yet been determined for the fiscal
     year in which the termination occurs); (iii) continuation of all health and
     life insurance benefits through the end of the Severance Period
     substantially identical to those to which the Employee was entitled
     immediately prior to the termination, or to those being offered to officers
     of the Company, or a successor corporation, if the Company's benefit
     programs are changed during the Severance Period; (iv) full and immediate
     vesting of each unvested Option held by the Employee on the date of
     termination so that each such option shall be exercisable in full on the
     termination date in accordance with the provisions of the Option Agreement
     and Plan pursuant to which such option was granted; (v) outplacement
     services with a total value not to exceed $15,000. For purposes of this
     Agreement, the term "target bonus" shall mean the Employee's base salary in
     effect on the termination date multiplied by that percentage of such base
     salary that is prescribed by the Company under its Executive Bonus Program
     as the percentage of such base

                                       2

<PAGE>

     salary payable to the Employee as a bonus if the Company pays bonuses at
     one-hundred percent and (100%)of its operating plan.

          (iii). Involuntary Termination for Cause. If the Employee's employment
     is terminated for Cause, then the Employee shall not be entitled to receive
     severance payments. The Employee's benefits will be terminated under the
     Company's then existing benefit plans and policies in accordance with such
     plans and policies in effect on the date of termination.

     (a) Termination Apart from A Change of Control. In the event the Employee's
employment terminates for any reason, either prior to the occurrence of a Change
of Control or after the two year period following the effective date of a Change
of Control, then the Employee shall not be entitled to receive any severance
payments under this Agreement. The Employee's benefits will be terminated under
the terms of the Company's then existing benefit plans and policies in
accordance with such plans and policies in effect on the date of termination or
as otherwise determined by the Board of Directors of the Company.

     4. DEFINITION OF TERMS. The following terms referred to in this Agreement
shall have the following meanings:

          (a) CHANGE OF CONTROL. "Change of Control" shall mean the occurrence
     of any of the following events:

               (i). OWNERSHIP. Any "Person" (as such term is used in Sections
          13(d) and 14(d) of the Securities Exchange Act of 1934, as amended) is
          or becomes the "Beneficial Owner" (as defined in Rule 13d-3 under said
          Act), directly or indirectly, ofsecurities of the Company representing
          twenty percent (20%) or more of the total voting power represented by
          the Company's then outstanding voting securities without the approval
          of the Board of Directors of the Company; or

               (ii). MERGER/SALE OF ASSETS. A merger or consolidation of the
          Company whether or not approved by the Board of Directors of the
          Company, other than a merger or consolidation which would result in
          the voting securities of the Company outstanding immediately prior
          thereto continuing to represent (either by remaining outstanding or by
          being converted into voting securities of the surviving entity) at
          least fifty percent (50%) of the total voting power represented by the
          voting securities of the Company or such surviving entity outstanding
          immediately after such merger or consolidation, or the stockholders of
          the Company approve a plan of complete liquidation of the Company or
          an agreement for the sale or disposition by the Company of all or
          substantially all of the Company's assets.

               (iii). CHANGE IN BOARD COMPOSITION. A change in the composition
          of the Board of Directors of the Company, as a result of which fewer
          than a majority of the directors are Incumbent Directors. "Incumbent
          Directors" shall mean directors who either (A) are directors of the
          Company as of January 3, 2000 or (B) are elected, or nominated for
          election, to the Board of Directors of the Company with the
          affirmative votes of at least a majority of the Incumbent Directors at
          the time of such election or nomination (but shall not include an
          individual whose election or nomination is in connection with an
          actual or threatened proxy contest relating to the election of
          directors to the Company).

          (b) CAUSE. "Cause" shall mean (i) gross negligence or willful
     misconduct in the performance of the Employee's duties to the Company where
     such gross negligence or willful misconduct has resulted or is likely to
     result in substantial and material

                                       3

<PAGE>

     damage to the Company or its subsidiaries, (ii) repeated unexplained or
     unjustified absence from the Company, (iii) a material and willful
     violation of any federal or state law; (iv) commission of any act of fraud
     with respect to the Company; or (v) conviction of a felony or a crime
     involving moral turpitude causing material harm to the standing and
     reputation of the Company, in each case as determined in good faith by the
     Board of Directors of the Company.

          (c) INVOLUNTARY TERMINATION. "Involuntary Termination" shall include
     any termination by the Company other than for Cause and the Employee's
     voluntary termination, upon 30 days prior written notice to the Company,
     following (i) any reduction of the Employee's base compensation (other than
     in connection with a general decrease in base salaries for most similarly
     situated employees of the successor corporation); or (ii) the Employee's
     refusal to relocate to a location more than 50 miles from the Company's
     current location.

     5. LIMITATION ON PAYMENTS. To the extent that any of the payments or
benefits provided for in this Agreement to the Employee constitute "parachute
payments" within the meaning of Section 280G of the Internal Revenue Code of
1986, as amended (the "Code") and, but for this Section 5, would be subject to
the excise tax imposed by Section 4999 of the Code, the Company shall reduce the
aggregate amount of such payments and benefits such that the present value
thereof (as determined under the Code and the applicable regulations) is equal
to 2.99 times the Employee's "base amount" as defined in Section 280G(b)(3) of
the Code.

     6. CERTAIN BUSINESS COMBINATIONS. In the event it is determined by the
Board, upon consultation with Company management and the Company's independent
auditors, that the enforcement of any Section of this Agreement, including, but
not limited to, Section 2 hereof, which allows for the acceleration of vesting
of option shares upon the effective date of a Change of Control, would preclude
accounting for any proposed business combination of the Company involving a
Change of Control as a pooling of interests, and the Board otherwise desires to
approve such a proposed business transaction which requires as a condition to
the closing of such transaction that it be accounted for as a pooling of
interests, then any such Section of this Agreement shall be null and void. For
purposes of this Section 6, the Board's determination shall require the
unanimous approval of the non-employee Board members.

     7. SUCCESSORS. Any successor to the Company (whether direct or indirect and
whether by purchase, lease, merger, consolidation, liquidation or otherwise) to
all or substantially all of the Company's business and/or assets shall assume
the obligations under this Agreement and agree expressly to perform the
obligations under this Agreement in the same manner and to the same extent as
the Company would be required to perform such obligations in the absence of a
succession. The terms of this Agreement and all of the Employee's rights
hereunder shall inure to the benefit of, and be enforceable by, the Employee's
personal or legal representatives, executors, administrators, successors, heirs,
distributees, devisees and legatees.

     8. NOTICE. Notices and all other communications contemplated by this
Agreement shall be in writing and shall be deemed to have been duly given when
personally delivered or when mailed by U.S. registered or certified mail, return
receipt requested and postage prepaid. Mailed notices to the Employee shall be
addressed to the Employee at the home address which the Employee most recently
communicated to the Company in writing. In the case of the Company, mailed
notices shall be addressed to its corporate headquarters, and all notices shall
be directed to the attention of its Secretary.

                                       4

<PAGE>

     9. MISCELLANEOUS PROVISIONS.

     (a) NO DUTY TO MITIGATE. The Employee shall not be required to mitigate the
amount of any payment contemplated by this Agreement (whether by seeking new
employment or in any other manner), nor, except as otherwise provided in this
Agreement, shall any such payment be reduced by any earnings that the Employee
may receive from any other source.

     (b) WAIVER. No provision of this Agreement shall be modified, waived or
discharged unless the modification, waiver or discharge is agreed to in writing
and signed by the Employee and by an authorized officer of the Company (other
than the Employee). No waiver by either party of any breach of, or of compliance
with, any condition or provision of this Agreement by the other party shall be
considered a waiver of any other condition or provision or of the same condition
or provision at another time.

     (c) WHOLE AGREEMENT. No agreements, representations or understandings
(whether oral or written and whether express or implied) which are not expressly
set forth in this Agreement have been made or entered into by either party with
respect to the subject matter hereof. This Agreement supersedes any agreement of
the same title and concerning similar subject matter dated prior to the date of
this Agreement, and by execution of this Agreement both parties agree that any
such predecessor agreement shall be deemed null and void. (d) Choice of Law. The
validity, interpretation, construction and performance of this Agreement shall
be governed by the laws of the State of California without reference to conflict
of laws provisions.

     (e) SEVERABILITV. If any term or provision of this Agreement or the
application thereof to any circumstance shall, in any jurisdiction and to any
extent, be invalid or unenforceable, such term or provision shall be ineffective
as to such jurisdiction to the extent of such invalidity or unenforceability
without invalidating or rendering unenforceable the remaining terms and
provisions of this Agreement or the application of such terms and provisions to
circumstances other than those as to which it is held invalid or unenforceable,
and a suitable and equitable term or provision shall be substituted therefore to
carry out, insofar as may be valid and enforceable, the intent and purpose of
the invalid or unenforceable term or provision.

     (f) ARBITRATION. Any dispute or controversy arising under or in connection
with this Agreement may be settled at the option of either party by binding
arbitration in the County of Santa Clara, California, in accordance with the
rules of the American Arbitration Association then in effect. Judgment may be
entered on the arbitrator's award in any court having jurisdiction. Punitive
damages shall not be awarded.

     (g) LEGAL FEES AND EXPENSES. The parties shall each bear their own
expenses, legal fees and other fees incurred in connection with this Agreement.

     (h) NO ASSIGNMENT OF BENEFITS. The rights of any person to payments or
benefits under this Agreement shall not be made subject to option or assignment,
either by voluntary or involuntary assignment or by operation of law, including
(without limitation) bankruptcy, garnishment, attachment or other creditor's
process, and any action in violation of this subsection (h) shall be void.

                                       5

<PAGE>

     (i) EMPLOYMENT TAXES. All payments made pursuant to this Agreement will be
subject to withholding of applicable income and employment taxes.

     (j) ASSIGNMENT BY COMPANY. The Company may assign its rights under this
Agreement to an affiliate, and an affiliate may assign its rights under this
Agreement to another affiliate of the Company or to the Company; provided,
however, that no assignment shall be made if the net worth of the assignee is
less than the net worth of the Company at the time of assignment. In the case of
any such assignment, the term "Company" when used in a section of this Agreement
shall mean the corporation that actually employs the Employee.

     (k) COUNTERPARTS. This Agreement may be executed in counterparts, each of
which shall be deemed an original, but all of which together will constitute one
and the same instrument.

         IN WITNESS WHEREOF, each of the parties has executed this Agreement, in
the case of the Company by its duly authorized officer, as of the day and year
first above written.

CONCEPTUS, INC.                            EMPLOYEE

By:    /s/ Kathryn Tunstall                By:    /s/ Steve Bacich
   ----------------------------------         ----------------------------------

Title: Chairman                            Title: CEO
      -------------------------------            -------------------------------

Date:  2/16/00                             Date:  2/15/00
     --------------------------------           --------------------------------

                                       6

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