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                                                                EXHIBIT 10.16

                                       ***Text Omitted and Filed Separately
                                          Confidential Treatment Requested
                                          Under 17 C.F.R. Sections 200.80(b)(4),
                                          200.83 and 230.406

                             COLLABORATIVE RESEARCH

                                       AND

                                LICENSE AGREEMENT

                                     BETWEEN

                                  SENOMYX, INC.

                                       AND

                         AURORA BIOSCIENCES CORPORATION

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                  COLLABORATIVE RESEARCH AND LICENSE AGREEMENT

THIS AGREEMENT is entered into as of the Effective Date by and between SENOMYX,
INC., a Delaware corporation having offices at 11099 North Torrey Pines Road, La
Jolla, California 92037 ("Senomyx"), and AURORA BIOSCIENCES CORPORATION, a
Delaware corporation having offices at 11010 Torreyana Road, San Diego,
California 92121 ("Aurora").

                                    RECITALS

WHEREAS, Senomyx conducts research in the field of chemosensation, an objective
of which is to discover potential biological targets and develop assays for use
in taste, olfaction and pheromone detection; and

WHEREAS, Aurora develops assays and screening systems and related
biologies/chemistries used therein; and

WHEREAS, Senomyx and Aurora are interested in collaborating in the development
of assays and screening systems to identify and develop small molecules for use
in consumer products and therapeutics.

                                    AGREEMENT

NOW, THEREFORE, in consideration of the foregoing premises and of the covenants,
representations and agreements set forth below, the parties hereby agree as
follows:

1.       DEFINITIONS

As used herein, the following terms shall have the following meanings:

"Agreement" means this agreement, together with all exhibits attached hereto, as
the same may be amended or supplemented from time to time hereafter by a written
agreement duly executed by authorized representatives of each party.

"Assay Platform" means one or more cell lines or biochemical screens developed
under the collaboration by Aurora and/or Senomyx for Targets, as described in a
Work Plan.

"Aurora Compound" means any chemical Controlled by Aurora.

"Aurora Know-How" means all Know-How related to the Assay Platforms or Aurora
Reporters, which is not covered by the Aurora Patent Rights, but is necessary to
practice the licenses granted under this Agreement, and which is Controlled by
Aurora as of the Effective Date or developed by Aurora in the course of
performing activities under a Work Plan.

"Aurora Patent Rights" mean all Patent Rights that claim Assay Platforms or
Aurora Reporters, which are necessary to practice the licenses granted under
this Agreement, and which are

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Controlled by Aurora as of the Effective Date or developed by Aurora in the
course of performing activities under a Work Plan, but excluding any Joint
Patent Rights. The Aurora Patent Rights as of the Effective Date are set forth
on Exhibit 1.

"Aurora Reporter" means any of the reporters described in Exhibit 3.

"Aurora Screening Program" has the meaning set forth in Section 2.4.

"Aurora Technology " means Aurora Patent Rights and Aurora Know-How.

"Collaborative Period" means the period beginning on the Effective Date and
ending [...***...], unless terminated earlier in accordance with Section 10.2,
10.3 or 10.4.

"Compound Supply" has the meaning set forth in Section 2.4.1.

"Confidential Information" means all information, Inventions and Know-How
disclosed by one party to the other party pursuant to this Agreement, including,
without limitation, information and material (whether or not patentable)
regarding technology, products, research, development, manufacturing, marketing,
finances, personnel or other business information or objectives which is
designated as confidential in writing by the disclosing party, whether by letter
or by the use of an appropriate stamp or legend, prior to or at the time any
such material, trade secret or other information is disclosed by the disclosing
party to the other party. Notwithstanding the foregoing to the contrary,
Know-How or other information which is orally, electronically or visually
disclosed by a party, or is disclosed in writing without an appropriate letter,
stamp or legend, shall constitute Confidential Information of a party if the
disclosing party, within thirty (30) days after such disclosure, delivers to the
other party a written document or documents describing the Know-How or other
information and referencing the place and date of such oral, visual, electronic
or written disclosure and the names of the persons to whom such disclosure was
made.

"Control" or "Controlled" means, with respect to intellectual property,
possession by a party, as of the Effective Date or during the Collaborative
Period, of the ability to grant a license or sublicense in accordance with the
terms of this Agreement, without violating the terms of any agreement by such
party with any Third Party that is in effect on the Effective Date.

"Derivative" means a chemical that has a structure based on data derived from a
Hit; provided that such chemical has the same modulating effect as such Hit when
tested in the same assay which was used to identify such Hit. It is understood
that Senomyx will test chemicals having a structure based on data derived from a
Hit in the same assay which was used to identify such Hit. It is further
understood that a Derivative includes a chemical derived from another
Derivative.

"Development Compound" means any Hit or Derivative selected for development as a
Product and for which studies necessary for an IND filing (e.g., good laboratory
practice safety studies) have been initiated.

"Effective Date" means the date that this Agreement is signed by the last party
to sign below.

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"Excluded Compounds" has the meaning set forth in Section 2.4.4.

"FDA" means the United States Food and Drug Administration, or any successor
agency having regulatory jurisdiction over the manufacture, distribution and
sale of drugs in the United States or the equivalent governmental agency in any
other jurisdiction.

"Field I" means [...***...].

"Field II" means [...***...].

"Full Time Equivalent" or "FTE" means the full time equivalent of one (1) Aurora
scientist, based on a minimum of [...***...] hours per year.

"GAAP" means generally accepted accounting principles consistently applied.

"Hit" means any chemical (e.g. a small molecule or protein) identified or
discovered in the course of screening such chemical by or for Senomyx using an
assay which incorporates or uses the Aurora Technology or an Aurora Reporter.

"IND" means an Investigational New Drug Application filed with the FDA to
commence human clinical testing of a Product.

"Internal Research" means self-funded or Third Party funded biological research
conducted by Senomyx at the premises of Senomyx, including the development of
screens, the performance of screening, the cloning of genes and the validation
of Targets. Notwithstanding the foregoing, Internal Research does not include
[...***...].

"Invention" means any new and useful process, method, or composition of matter,
or improvement thereto, whether or not patentable.

"Joint Invention" has the meaning set forth in Section 4.3.4.

"Joint Patent Rights" means all Patent Rights containing one or more claims to a
Joint Invention.

"Know-How" means information and data, whether or not patentable, which is not
generally known to the public, including, without limitation, designs, concepts,
formulae, techniques, practices, processes, methods, knowledge, skill,
experience, expertise, technical information and data, including
pharmacological, toxicological and clinical test data, analytical and quality
control data, patent and legal data or marketing, sales and manufacturing data.

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"Licensee" means any Third Party to whom Senomyx or any of its Affiliates grants
a license, sublicense or other right to manufacture, use, sell, offer for sale,
distribute and/or import one or more Products or Development Compounds.

"Licensor" means any Third Party that grants Senomyx or any of its Affiliates a
license, sublicense or other right to manufacture, use, sell, offer for sale,
distribute and/or import one or more Products or Development Compounds.

"Materials" mean any reagents, promoters, enhancers, vectors, plasmids, genes,
polynucleotides, cell lines, proteins and fragments thereof, peptides, antigens,
antibodies, antagonists, agonists, inhibitors, compounds and chemicals.

"NDA" means a New Drug Application or the equivalent, and all supplements
pursuant to the requirements of the FDA, including all documents, data and other
information concerning Products which are necessary for FDA approval to market a
Product, or the equivalent governmental approval in any other country.

"Net Sales" means, with respect to a Product, the gross amount invoiced by
Senomyx, its Affiliates, Licensors, Licensees, and/or permitted sublicensees on
sales or other transfers of the Product, less the following items:

         (i)    allowances (actually paid and limited to rejections, returns,
                and prompt payment and volume discounts granted to customers of
                Products, whether in cash or Products in lieu of cash);

         (ii)   freight, transport packing, insurance charges associated with
                transportation; and

         (iii)  taxes, tariff or import/export duties based on sales when
                included in gross sales, but not value-added taxes or taxes
                assessed on income derived from such sales.

Where Senomyx distributes to an Affiliate, Licensor, Licensee, a joint venture
or permitted sublicensees for end use by such Affiliate, Licensor, Licensee,
joint venture or permitted sublicensees then such distribution will be
considered a sale at list price normally charged to independent Third Parties
and Aurora will be entitled to collect a royalty on such sale in accordance with
Section 3. Such amounts shall be determined from the books and records of
Senomyx, its Affiliates, Licensor, Licensees, joint venture and/or its permitted
sublicensees, maintained in accordance with GAAP.

"Patent Rights" means all rights associated with all United States or foreign
(including regional authorities such as the European Patent Office) regular or
provisional patents or patent applications, including any continuation,
continuation-in-part, or division thereof or any substitute application therefor
or equivalent thereof, and any patent issuing thereon, including any reissue,
reexamination or extension thereof and any confirmation patent or registration
patent or patent of additions based on any such patent.

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"Phase II Clinical Trial" means studies in humans of the safety, dose ranging
and efficacy of a Product in Field I.

"Product" means any composition of matter which incorporates a Development
Compound or is manufactured using the Aurora Technology or an Aurora Reporter.

"Royalty Term" means, in the case of any Product and as to any country, the
period of time commencing [...***...] and ending upon [...***...] in such
country.

"Senomyx Compound" means any chemical Controlled by Senomyx.

"Senomyx Know-How" means all Know-How related to the Assay Platforms (including
the Targets), which is not covered by the Senomyx Patent Rights, but is
necessary to accomplish the activities to be conducted under this Agreement, and
which is Controlled by Senomyx as of the Effective Date or developed by Senomyx
in the course of performing activities under a Work Plan.

"Senomyx Patent Rights" means all Patent Rights which are necessary to
accomplish the activities to be conducted under this Agreement, and which are
Controlled by Senomyx as of the Effective Date or developed by Senomyx in the
course of performing activities under a Work Plan, but excluding any Joint
Patent Rights. The Senomyx Patent Rights as of the Effective Date are set forth
on Exhibit 2.

"Senomyx Technology" means Senomyx Patent Rights and Senomyx Know-How.

"Steering Committee" has the meaning set forth in Section 2.1.

"Stock Purchase Agreement" means the stock purchase agreement set forth on
Exhibit 4.

"Target" means a target identified in taste, olfaction and pheromone detection
and listed on Exhibit 5, as modified from time to time by the Steering Committee
as provided under Section 2.2.

"Term" has the meaning set forth in Section 10.1.

"Third Party" means any person or entity other than Aurora or Senomyx.

"Tracking Record" has the meaning set forth in Section 5.5.2.

"Ultra-High Throughput Screening System" or "UHTSS(TM) System" means a
technology platform sold by Aurora that has the capability of screening over
100,000 compounds per day, accessed from a store of compounds, with the
additional ability to capture and store large volumes of information.

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"Validation" has the meaning set forth in Section 2.3.3.

"Validation Criteria" means the parameters, standard and results established by
the Steering Committee for each Assay Platform based on the performance criteria
provided in Exhibit 6.

"Voltage Ion Probe Reader" or "VIPR" means the instrumentation described in
Exhibit 7.

"Voltage Ion Probe Reader II" or "VIPR II" means the instrumentation described
in Exhibit 7.

"Work Plan" has the meaning set forth in Section 2.3.1.

2.       COLLABORATION, ASSAY PLATFORM DEVELOPMENT AND SCREENING PROGRAM

2.1      STEERING COMMITTEE. No later than ten (10) days after the Effective
         Date, the parties shall establish a joint steering committee (the
         "Steering Committee"). The Steering Committee shall prepare and manage
         each Work Plan. The Steering Committee shall consist of two (2)
         representatives designated by Senomyx and two (2) representatives
         designated by Aurora. Each representative to the Steering Committee
         will have one vote. The Steering Committee will meet no later than
         thirty (30) days after the Effective Date and at least four (4) times
         per year using mutually agreed upon meeting locations and formats
         including tele- and video-conferencing. On an alternating basis, one
         party shall promptly prepare and deliver to the members of the Steering
         Committee minutes of such meetings for review and approval of both
         parties. Aurora and Senomyx shall flip a coin to determine who shall
         prepare the minutes for the first Steering Committee meeting. Decisions
         in the Steering Committee will be made by unanimous vote, at a meeting
         where all four (4) voting representatives are present. All unresolved
         disputes will be settled in accordance with Section 11.13, or as
         otherwise mutually agreed upon in writing.

2.2      TARGET SELECTION. The Steering Committee may, in its sole discretion,
         add and/or remove Targets from the list of Targets set forth on Exhibit
         5.

2.3      ASSAY PLATFORM PROGRAM.

2.3.1    WORK PLAN. The Steering Committee will prepare and agree upon a written
         plan for each Assay Platform (a "Work Plan"), which sets forth the
         respective responsibilities of the parties for the development of each
         Assay Platform. Each Work Plan will contain a description of the
         specific deliverables and documentation to be produced, any Aurora
         Reporter to be used, the dates by which such activities are expected to
         be accomplished by the parties, and Validation Criteria for each Assay
         Platform.

2.3.2    ASSAY PLATFORM DEVELOPMENT. Within ten (10) days following the approval
         of each Work Plan, Aurora will commence the development of the
         applicable Assay Platform using

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         reasonable efforts, consistent with commercial business practices, and
         using the resources provided under Section 3.1. All work under a Work
         Plan shall be performed in accordance with the provisions of this
         Agreement.

2.3.3    VALIDATION OF ASSAY PLATFORMS. When Aurora completes the development of
         an Assay Platform, a written report describing the Assay Platform and
         the data demonstrating compliance with the Work Plan, including the
         Validation Criteria, shall be provided by Aurora to the Steering
         Committee. The Steering Committee will either approve the report and
         accept each Assay Platform according to the Validation Criteria
         ("Validation") or decide on additional work, if any, necessary for
         Validation. Within thirty (30) days of such Validation of an Assay
         Platform developed by Aurora, and as requested in writing by Senomyx,
         Aurora shall transfer such Assay Platform to Senomyx.

2.4      SCREENING BY AURORA. During the Collaborative Period and for
         [...***...] thereafter, Senomyx may purchase from Aurora contract
         screening pursuant to Section 3.3. Aurora will screen Aurora Compounds
         or Senomyx Compounds as determined by the Steering Committee and
         provide re-tests of putative Hits, and determination of crude EC50s or
         IC50s as determined by the Steering Committee (an "Aurora Screening
         Program").

2.4.1    SENOMYX COMPOUNDS. Senomyx shall, [...***...], supply Aurora with
         Senomyx Compounds for each Aurora Screening Program. Any Senomyx
         Compounds supplied by Senomyx for use in an Aurora Screening Program
         will be [...***...], or another format mutually agreed to in writing by
         the parties (the "Compound Supply"). The quantities needed for each
         screen will be specified in writing in the Work Plan. Aurora agrees not
         to transfer the Compound Supply to any Third Party or to use it for any
         purpose other than developing or screening Assay Platforms without
         Senomyx's prior written consent. Aurora will return to Senomyx any
         unused Compound Supply.

2.4.2    AURORA COMPOUND SUPPLY. Aurora will make available to Senomyx
         [...***...] Aurora Compounds for use in Aurora Screening Programs. The
         Steering Committee will select, on an entire microtiter plate-by-entire
         microtiter plate basis, Aurora Compounds for use in an Aurora Screening
         Program. Information concerning Aurora Compounds shall be owned
         exclusively by Aurora and shall be treated as Confidential Information
         of Aurora hereunder.

2.4.3    SCREENING PROGRAM REPORTS. During the course of an Aurora Screening
         Program, individuals from Senomyx and Aurora, appointed by the Steering
         Committee, will discuss and review monthly, if not more frequently, the
         progress and any issues relating to such Aurora Screening Program.
         During the Collaboration Period, the Steering Committee will review
         data and prepare summary quarterly reports for each Aurora Screening
         Program in progress at that time. Each progress report shall provide a
         written

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         update of work performed, any Hits identified, and all available
         supporting electronic data.

2.4.3    DESIGNATION OF EXCLUDED COMPOUNDS. At least thirty (30) days prior to
         commencement of any Aurora Screening Program, Senomyx shall submit to
         Aurora in writing a list of the Excluded Compounds designated for a
         particular screen to be used as a positive control in such screens,
         which list is subject to the approval of the Steering Committee, which
         approval shall not be unreasonably withheld.

2.4.5    OWNERSHIP OF RESULTS AND DATA. All results and data generated from
         screening the Compound Supply by or for Senomyx under this Agreement
         shall be owned exclusively by Senomyx and shall be treated as Senomyx
         Confidential Information hereunder. Aurora will not provide to a Third
         Party the Materials provided by Senomyx to Aurora hereunder.

2.5      DEVELOPMENT OF PRODUCTS. Senomyx will be responsible, at [...***...]
         expense, for all formulation and regulatory approval of Products
         arising out of this Agreement. Senomyx shall use reasonable efforts,
         consistent with commercial business practices, to develop any Product,
         to perform all regulatory activities relating to the manufacture, use
         or sale of any Product, and to commercialize and market any Product in
         any country. All regulatory filings made or filed by Senomyx for any
         Development Compound or Product [...***...]. [...***...], Aurora shall
         cooperate to the extent reasonably necessary to permit Senomyx to
         perform the foregoing activities.

2.6      SUPPLY OF VIPR AND OPTION TO UPGRADE TO VIPR II. Within [...***...]
         after the Effective Date, Aurora will deliver a VIPR to the Senomyx
         facility in La Jolla, California, or another Senomyx location mutually
         agreed upon by the parties, and within [...***...] of receipt of such
         VIPR, Aurora shall install and commission it to demonstrate
         functionality as to the instrumentation specifications listed in
         Exhibit 7. On or before [...***...], and [...***...], Senomyx shall
         have the option to exchange the VIPR for a VIPR II by providing written
         notice to Aurora and making the additional payment to Aurora in
         accordance with Section 3.9. Within [...***...] of receipt of such
         notice, Aurora will deliver a VIPR II to the Senomyx facility in La
         Jolla, California, or another Senomyx location mutually agreed by the
         parties, and within [...***...] of receipt of such VIPR II, Aurora
         shall (i) install and commission the VIPR II to demonstrate
         functionality as to the instrumentation specification listed in Exhibit
         7, and (ii) return the VIPR to Aurora. Subject to payment of the
         warranty fee set forth in Section 3.9, Aurora will provide to Senomyx
         Aurora's then-current standard warranty as described on Exhibit 7 for
         such VIPR or VIPR II for a period of [...***...]

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         [...***...] from the date of delivery of the VIPR, provided that such
         warranty may be extended as provided for in Section 3.9.

3.       FINANCIAL TERMS

3.1      ANNUAL RESEARCH SUPPORT. Each year during the Collaborative Period,
         Senomyx shall pay Aurora for [...***...] FTEs at an annual rate of
         [...***...] per FTE. These payments shall be made in advance on an
         equal quarterly basis. The first payment shall be made within ten (10)
         business days following the Effective Date. These payments are
         inclusive of overhead, labor, and supplies; PROVIDED, HOWEVER, that in
         any given year, a portion of these payments may be allocated to cover
         the cost of high throughput screening of Senomyx Compounds by Aurora
         [...***...] with a commensurate reduction in the allocation of payments
         for FTEs. These payments shall not cover the cost associated with
         providing the Compound Supply to Aurora or other unanticipated
         materials, as agreed to by the parties in advance in writing, or the
         costs of high throughput screening for [...***...]. Additional funding,
         if any, shall be proposed by the Steering Committee and agreed to by
         the parties in advance in writing.

3.2      VALIDATION PAYMENTS. Senomyx will pay to Aurora the following
         non-creditable, non-refundable milestone payments within thirty (30)
         days following achievement of the following milestone events:

         MILESTONE                                               PAYMENT

         [...***...]                                          [...***...]
         [...***...]                                          [...***...]
         [...***...]                                          [...***...]

3.3      SCREENING BY AURORA. Aurora will screen Aurora Compounds and Senomyx
         Compounds under each Aurora Screening Program in accordance with
         Section 2.4. Senomyx will pay Aurora for such screening within thirty
         (30) days after the completion of such screening. For screening
         conducted by Aurora using its ultra-high throughput screening system,
         Senomyx will pay Aurora [...***...], with [...***...]. For screening
         conducted by Aurora using its VIPR, Senomyx will pay Aurora
         [...***...], with [...***...]. The parties will negotiate in good faith
         the payments To be made by Senomyx to Aurora for Aurora Compounds which
         may be licensed to Senomyx hereunder, including, without limitation,
         [...***...].

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3.4      MILESTONES AND ROYALTIES.

3.4.1    MILESTONE PAYMENTS FOR FIELD I. Senomyx will pay to Aurora the
         following non-creditable, non-refundable milestone payments for each
         Product in Field I within thirty (30) days following achievement of the
         following milestone events:

         MILESTONE                                             PAYMENT

         [...***...]                                          [...***...]
         [...***...]                                          [...***...]
         [...***...]                                          [...***...]
         [...***...]                                          [...***...]

         The foregoing milestones apply only to the first chemical developed for
         each Product. Under no circumstances shall Senomyx be obligated to pay
         any of the foregoing payments to Aurora more than once for each
         Product.

3.4.2    ROYALTY ON NET SALES. Senomyx will pay to Aurora a royalty equal to
         [...***...] of Net Sales for each Product in Field I during the Royalty
         Term.

3.4.3    TRADE SECRET MILESTONES AND ROYALTY. The parties acknowledge that the
         principal value contributed by Aurora under this Agreement is the
         enhanced probability of identifying leads for Products, such as
         consumer products enhancing taste and olfaction (or other products
         having commercial value), and the potential to generate multiple leads,
         either or both of which the parties reasonably believe will lessen the
         time required to bring products to market and increase the efficiency
         of discovery and development processes and technologies. Additionally,
         the parties acknowledge that Aurora may not Control Patent Rights
         covering the manufacture, sale, use or importation of a particular
         Development Compound or Product. Senomyx acknowledges and agrees that
         the value it receives hereunder is in the access and use of a Assay
         Platform or Aurora Reporter. Accordingly, Senomyx agrees to pay
         [...***...].

3.5      SUPPLY OF AURORA REPORTERS. Within [...***...] of a written purchase
         order from Senomyx, Aurora will supply to Senomyx Materials pertaining
         to the Aurora Reporters. Senomyx will be charged for all Materials so
         delivered at Aurora's then-current list price less [...***...];
         PROVIDED, HOWEVER, that Senomyx will purchase [...***...], as defined
         on Exhibit 3, on or before [...***...], at a price of [...***...].
         Senomyx will pay for all Materials so ordered within thirty (30) days
         after delivery of such Materials to Senomyx.

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3.6      AURORA STOCK PURCHASE. Within ten (10) days following the Effective
         Date, Aurora will purchase four million eight hundred thousand dollars
         ($4,800,000) of Senomyx Series C preferred stock under terms and
         conditions consistent with its most recent round of financing and
         pursuant to the Stock Purchase Agreement at a price of four dollars,
         eighty cents ($4.80) per share.

3.7      LICENSE FEE. In partial consideration for the licenses granted under
         Section 4.1, Senomyx will pay to Aurora a non-creditable,
         non-refundable license fee of [...***...] within ten (10) days
         following the Effective Date.

3.8      PURCHASE OF VIPR AND UPGRADE TO VIPR II. In consideration for the VIPR,
         Senomyx shall pay to Aurora [...***...] payable in two equal
         installments: (i) [...***...] within [...***...] after delivery of such
         VIPR to Senomyx, and (ii) [...***...] within [...***...] after the
         commissioning of such VIPR at Senomyx. If Senomyx exercises its option
         To exchange the VIPR for a VIPR II, then Senomyx will pay to Aurora an
         additional payment of [...***...] within [...***...] after the
         commissioning of such VIPR II at Senomyx. In consideration for the
         [...***...] VIPR warranty provided under Section 2.6, Senomyx shall pay
         to Aurora a warranty fee of [...***...] within [...***...] after the
         first anniversary of the date of delivery of the VIPR to Senomyx.
         Senomyx may, at its sole discretion, extend the warranty on the VIPR or
         the VIPR II beyond such [...***...] period for [...***...] per year
         payable on [...***...] thereafter.

4.       LICENSES; INTELLECTUAL PROPERTY RIGHTS

4.1      GRANT OF RIGHTS FROM AURORA TO SENOMYX.

4.1.1    NON-EXCLUSIVE LICENSE TO USE AURORA TECHNOLOGY IN ASSAY PLATFORMS.
         Subject to the terms and conditions of this Agreement, Aurora hereby
         grants to Senomyx a [...***...] license, without the right to grant
         sublicenses, under the Aurora Technology to use the Assay Platforms
         [...***...].

4.1.2    EXCLUSIVE LICENSE TO USE AURORA TECHNOLOGY IN ASSAY PLATFORMS
         [...***...]. Subject to the terms and conditions of this Agreement,
         Aurora hereby grants to Senomyx a [...***...] license, without

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         the right to grant sublicenses, under the Aurora Technology to use the
         Assay Platforms [...***...].

4.1.3    NON-EXCLUSIVE LICENSE TO USE AURORA REPORTERS [...***...]. Subject to
         the terms and conditions of this Agreement, AURORA hereby grants to
         Senomyx a [...***...] license, without the right to grant sublicenses,
         under the Aurora Technology to use the Aurora Reporters [...***...].

4.1.4    EXCLUSIVE LICENSE TO USE AURORA REPORTERS [...***...]. Subject to the
         terms and conditions of this Agreement, Aurora hereby grants to Senomyx
         a [...***...] license, without the right to grant sublicenses, under
         the Aurora Technology to use the Aurora Reporters [...***...].

4.1.5    NON-EXCLUSIVE LICENSE TO USE VIPR AND VIPR II [...***...]. Subject to
         the terms and conditions of this Agreement, including the payment
         obligations set forth in Section 3.9, Aurora hereby grants to Senomyx a
         [...***...] license, without the right to grant sublicenses, under the
         Aurora Technology to use the VIPR or VIPR II, if applicable,
         [...***...].

4.1.6    LICENSE RESTRICTIONS. Except as expressly licensed in this Section 4.1,
         Senomyx covenants not to use the Assay Platforms, Aurora Technology or
         Aurora Reporters for any purpose. Aurora will permit Senomyx to
         transfer Materials containing Aurora Reporters or Aurora Technology to
         a Third Party under terms mutually agreed upon in writing by Aurora and
         Senomyx prior to such transfer; PROVIDED, HOWEVER, that such Third
         Party is a bona fide licensee of Aurora under the Aurora Patent Rights.

4.1.7    EXCLUSIVE LICENSE EXCEPTIONS.

4.1.7.1  Notwithstanding anything contained herein to the contrary, the
         exclusive licenses granted by Aurora to Senomyx in this Section 4 are
         subject to all previous licenses granted by Aurora under the Aurora
         Technology, which list of licensees, as of the Effective Date,

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         includes, but is not limited to, [...***...]. Additionally, Aurora will
         not be precluded by the grant of such exclusive licenses from licensing
         the Aurora Technology in [...***...] for use with the Targets to future
         licensees, but only when such license is granted in connection with the
         purchase of a UHTSS(TM) System from Aurora. Aurora will notify Senomyx
         in writing if and when such a license is granted.

4.1.7.2  Notwithstanding the exclusive licenses granted by Aurora to Senomyx in
         this Section 4, Aurora will not be precluded from selling and/or
         providing Aurora Reporters to academic, government and other
         not-for-profit organizations. Aurora may grant licenses under the
         Aurora Technology to such not-for-profit organizations to conduct
         research using the Aurora Reporters through material transfer
         agreements, shrink-wrap licenses or otherwise.

4.2      GRANT OF RIGHTS FROM SENOMYX TO AURORA. Senomyx hereby grants to Aurora
         a fully-paid, non-transferable, except as provided in Section 11.1,
         non-exclusive, worldwide license, without the right to grant
         sublicenses, to use the Senomyx Technology solely to perform its
         obligations under this Agreement. Except as expressly licensed in this
         Section 4.2, Aurora covenants not to use the Senomyx Compounds or the
         Senomyx Technology provided by Senomyx either for Internal Research or
         with Third Parties.

4.3      OWNERSHIP OF INTELLECTUAL PROPERTY.

4.3.1    TRANSFER OF RIGHTS. All rights not expressly licensed or assigned
         herein by Senomyx are retained by Senomyx. All rights not expressly
         licensed or assigned herein by Aurora are retained by Aurora. Except as
         otherwise expressly provided in this Agreement, nothing in this
         Agreement is intended to convey or transfer ownership by either party
         to the other party of any right, title or interest in any Confidential
         Information, Patent Rights or Know-How Controlled by a party. Except as
         expressly provided for in this Agreement, nothing in this Agreement
         shall be construed as a license or sublicense by either party to the
         other party of any rights in any Patent Rights or Know-How Controlled
         by a party.

4.3.2    SENOMYX INVENTIONS. Senomyx shall own all Inventions and other Know-How
         made solely by its employees and agents, and all Patent Rights claiming
         such Inventions and other Know-How. Senomyx hereby irrevocably assigns
         to Aurora all right, title and interest in and to any such Inventions
         and other Know-How that consist of improvements to an Aurora Reporter,
         the Aurora Technology or the Aurora Compounds, and all Patent Rights
         claiming such Inventions and other Know-How, subject to the licenses
         granted to Senomyx pursuant to Section 4.1. In the event that Senomyx
         is legally unable to assign such rights to Aurora, then Senomyx agrees
         either to waive the enforcement of such rights against Aurora and any
         sublicensees and assignees, or to grant Aurora an

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         exclusive, irrevocable, perpetual, worldwide, fully-paid license, with
         right to sublicense through multiple tiers of sublicense, to such
         rights.

4.3.3    AURORA INVENTIONS. Aurora shall own all Inventions and other Know-How
         made solely by its employees and agents, and all Patent Rights claiming
         such Inventions and other Know-How. Aurora hereby irrevocably assigns
         to Senomyx all right, title and interest in and to any such Inventions
         and other Know-How that consist of improvements to the Senomyx
         Technology or the Senomyx Compounds, and all Patent Rights claiming
         such Inventions and other Know-How, subject to the license granted to
         Aurora pursuant to Section 4.2. In the event that Aurora is legally
         unable to assign such rights to Senomyx, then Aurora agrees either to
         waive the enforcement of such rights against Senomyx and any
         sublicensees and assignees, or to grant Senomyx an exclusive,
         irrevocable, perpetual, worldwide, fully-paid license, with right to
         sublicense through multiple tiers of sublicense, to such rights.

4.3.4    JOINT INVENTIONS. During the Collaboration Period, all Inventions
         conceived jointly by employees or agents of Senomyx and employees or
         agents of Aurora (the "Joint Inventions") and all Joint Patent Rights
         shall be owned jointly by Aurora and Senomyx. Aurora hereby assigns to
         Senomyx all right, title and interest in and to any Joint Inventions
         that consist of improvements to the Senomyx Technology or the Senomyx
         Compounds, and all Joint Patent Rights claiming such Joint Inventions,
         subject to the license granted to Aurora pursuant to Section 4.2. In
         the event that Aurora is legally unable to assign such rights to
         Senomyx, then Aurora agrees either to waive the enforcement of such
         rights against Senomyx and any sublicensees and assignees, or to grant
         Senomyx an exclusive, irrevocable, perpetual, worldwide, fully-paid
         license, with right to sublicense through multiple tiers of sublicense,
         to such rights. Senomyx hereby irrevocably assigns to Aurora all right,
         title and interest in and to any Joint Inventions that consist of
         improvements to the Aurora Technology, the Aurora Reporters or the
         Aurora Compounds, and all Joint Patent Rights claiming such Joint
         Inventions, subject to the licenses granted to Senomyx pursuant to
         Section 4.1. In the event that Senomyx is legally unable to assign such
         rights to Aurora, then Senomyx agrees either to waive the enforcement
         of such rights against Aurora and any sublicensees and assignees, or to
         grant Aurora an exclusive, irrevocable, perpetual, worldwide,
         fully-paid license, with right to sublicense through multiple tiers of
         sublicense, to such rights.

4.3.5    OTHER INVENTIONS. Any Inventions not included in Sections 4.3.2, 4.3.3
         or 4.3.4 shall be owned by their inventors.

4.3.6    INVENTORSHIP AND ASSIGNMENT. Inventorship of patentable inventions
         shall be determined by United States patent law. Senomyx and Aurora
         agree to execute all documentation necessary to perfect all assignments
         of Inventions, Know-How and Patent Rights contemplated herein.

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5.       PAYMENTS OF ROYALTIES, ACCOUNTING FOR ROYALTIES AND RECORDS

5.1      PAYMENT AND REPORTING. The royalties due under Section 3.4.2 shall be
         paid within thirty (30) days after the end of each calendar quarter
         period in which such royalties are earned during the Royalty Term for
         each Product. With each such quarterly payment, Senomyx shall furnish
         to Aurora a royalty statement in sufficient detail to permit
         confirmation of the accuracy of the royalty payment made, which sets
         forth on a country-by-country basis the relevant sales information,
         including the total number of units of each such Product sold, Net
         Sales, the royalties payable in United States dollars, the method used
         to calculate the royalty, the exchange rate used and other information
         employed to calculate Net Sales for such Product.

5.2      CURRENCY OF PAYMENT. All payments to be made under this Agreement,
         including the royalties payable to Aurora by Senomyx, shall be paid in
         United States dollars by wire transfer or other mutually acceptable
         means to a bank account designated by Aurora. With respect to each
         quarter, for countries other than the United States, whenever
         conversion of payments form any foreign currency shall be required,
         such conversion shall be made at the rate of exchange reported in THE
         WALL STREET JOURNAL on the last business day of the applicable
         reporting period.

5.3      TAXES WITHHELD. Any income or other tax that Senomyx or any of its
         Affiliates, Licensees or Licensees is required by a government agency
         to withhold and pay on behalf of Aurora with respect to the royalties
         payable under this Agreement shall be deducted from and offset against
         such royalties prior to remittance to Aurora; PROVIDED, HOWEVER, that
         in regard to any tax so deducted, Senomyx shall give or cause to be
         given to Aurora such assistance as may reasonably be necessary to
         enable Aurora to claim exemption therefrom or credit therefor, and in
         each case shall promptly furnish to Aurora proper evidence of the taxes
         paid on Aurora's behalf.

5.4      RECORDS.

5.4.1    NET SALES AND ROYALTY CALCULATIONS. During the Royalty Term and for a
         period of [...***...] thereafter, Senomyx shall keep complete and
         accurate records of sales and all other information necessary to
         calculate Net Sales of each Product in sufficient detail to allow the
         accrued royalties to be determined accurately in accordance with GAAP.
         Aurora, with reasonable written notice to Senomyx, shall have the right
         to cause a nationally recognized independent, certified public
         accountant to audit such records at the place or places of business
         where such records are customarily kept in order to verify the accuracy
         of the reports of Net Sales and royalty payments made by Senomyx
         hereunder. Such accountant shall execute a confidentiality agreement
         prior to entering Senomyx's premises, obligating such accountant to
         keep all information disclosed to it confidential and shall only be
         permitted to disclose to Aurora the extent of any discrepancy between
         royalty payments made by Senomyx hereunder and the actual royalty
         required to be so

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         paid. Aurora shall bear the full cost of such audit, unless such audit
         discloses a variance of more than [...***...] from the amount of the
         royalties due under this Agreement, in which event, Senomyx shall bear
         the full cost of such audit. Aurora agrees not to disclose Confidential
         Information concerning royalty payments and reports, and all
         information learned in the course of any audit or inspection, except to
         the extent necessary for Aurora to reveal such information in order to
         enforce its rights under this Agreement or if disclosure is required by
         law.

5.4.2    TRACKING RECORDS. The chemicals, screens and Targets tested using an
         Assay Platform, Aurora Technology or Aurora Reporter will be recorded
         and stored by Senomyx using its customary means in a computer
         searchable database on a storage device. The information stored will
         include the Target, screen type, the concentration, structure and
         activity of the chemical tested, and date of testing in a format
         mutually agreed upon in writing by the parties. Records of any Hits,
         Derivatives, Aurora Compounds, Senomyx Compounds or other chemicals
         subjected to additional screening will be stored by Senomyx in a
         computer searchable file or database that will be separate from other
         Senomyx data not related to an Assay Platform, Aurora Technology or
         Aurora Reporter. Upon written request by Aurora, Senomyx will create an
         annual written report of Hits, Derivatives, Aurora Compounds, Senomyx
         Compounds or other chemicals subjected to additional screening, IN VIVO
         testing, computer modeling, or medicinal chemistry to be accessible
         only by an independent consultant. All the records described in this
         Section 5.4.2 are collectively referred to as tracking records (the
         "Tracking Records"). Senomyx will permit a Third Party appointed by
         Aurora and reasonably agreed to by Senomyx, and subject to a
         confidential relationship with Senomyx, to inspect the Tracking Records
         once per year or upon reasonable request by Aurora for the sole purpose
         of determining the attainment of a milestone or royalty under Section
         3.4. The Tracking Records shall be securely retained for no less than
         [...***...] from the last use of an Assay Platform, Aurora Technology
         or Aurora Reporter. When a compound, such as a Hit, Derivative or
         Development Compound, is selected for a good laboratory practice safety
         or toxicology study, Senomyx will disclose the compound to Aurora under
         strict confidentiality. Upon reasonable request by Aurora, and at a
         minimum once per year, Senomyx will provide Aurora with a summary of
         the status of Development Compounds and Products that may be used to
         calculate royalties or milestones hereunder.

6.       INTELLECTUAL PROPERTY ENFORCEMENT AND DEFENSE OF CLAIMS

6.1      INTELLECTUAL PROPERTY ENFORCEMENT. Each party shall have the right, but
         not the obligation, to bring proceedings against any Third Party for
         the inappropriate use, including patent infringement, of Patent Rights
         solely Controlled by it, at its own risk and expense. If either party
         brings such an action, such party shall be entitled to control such
         action, hire and retain counsel, make decisions, settle on any terms,
         and retain any and all awards or damages obtained in any such
         proceeding. At the request and expense of either party, the

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         other party shall give the requesting party all reasonable assistance
         required to file and conduct any such proceeding.

6.2      DEFENSE OF INFRINGEMENT CLAIMS FOR AURORA TECHNOLOGY. Senomyx will
         cooperate with Aurora, at Aurora's expense, in the defense of any suit,
         action or proceeding against Aurora alleging the infringement of the
         intellectual property rights of a Third Party by reason of Aurora's use
         of any Aurora Technology or any Aurora Reporter in performing its
         obligations under this Agreement. Aurora shall notify Senomyx promptly
         in writing of the commencement of any such suit, action, proceeding or
         claim of infringement. Senomyx shall give to Aurora full and sole
         authority, information and assistance necessary to defend, hire
         counsel, make decisions or settle on any terms any such suit, action or
         proceeding, and Senomyx shall execute all documents, provide pertinent
         records, and take all other actions, including requiring persons within
         its control to give testimony, which may be reasonably required in
         connection with the defense or settlement of such litigation.

6.3      DEFENSE OF INFRINGEMENT CLAIMS FOR PRODUCTS. Aurora will cooperate with
         Senomyx, at Senomyx's expense, in the defense of any suit, action or
         proceeding against Senomyx and Senomyx's Affiliates or Aurora alleging
         the infringement of the intellectual property rights of a Third Party
         by reason of the manufacture, use or sale of any Product. Each party
         shall give the other party prompt written notice of the commencement of
         any such suit, action, proceeding or claim of infringement. At the
         request and expense of Senomyx, Aurora shall give Senomyx full and sole
         authority, information and assistance necessary to defend, hire
         counsel, make decisions or settle on any terms any such suit, action or
         proceeding and Aurora shall execute all documents, provide pertinent
         records, and take all other actions, including requiring persons within
         its control to give testimony, which may be reasonably required in
         connection with the defense or settlement of such litigation.

7.       TREATMENT OF CONFIDENTIAL INFORMATION; PUBLICITY

7.1      CONFIDENTIALITY. Subject to the terms and conditions of this Agreement,
         Senomyx and Aurora each agree that, during the Term and for a period of
         [...***...] thereafter, it will keep confidential, and will cause its
         Affiliates to keep confidential, all Confidential Information that is
         disclosed to it or to any of its Affiliates by the other party. Neither
         Senomyx nor Aurora nor any of their respective Affiliates shall use the
         other party's Confidential Information, except as expressly permitted
         in this Agreement.

7.1.1    DISCLOSURE TO RELATED PARTIES. Senomyx and Aurora each agree that any
         disclosure of the other party's Confidential Information to any
         officer, employee, contractor, consultant, sublicensee or agent of the
         other party or to any of its Affiliates shall be made only if and to
         the extent necessary to carry out its responsibilities under this
         Agreement and to exercise the rights granted to it hereunder, shall be
         limited to the extent consistent with

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         such responsibilities and rights, and shall be provided only to such
         persons or entities who are under an obligation of confidentiality no
         less stringent than as set forth herein. Each party shall use
         reasonable efforts to take such action, and to cause its Affiliates to
         take such action, to preserve the confidentiality of each other's
         Confidential Information, which shall be the same efforts as it would
         customarily take to preserve the confidentiality of its own
         Confidential Information. Each party shall promptly notify the other
         party upon discovery of any unauthorized use or disclosure of the other
         party's Confidential Information.

7.1.2    RETURN OF CONFIDENTIAL MATERIAL UPON TERMINATION. Upon termination of
         this Agreement, each party, upon the other party's request, will return
         or destroy all Confidential Information received from the other party
         pursuant to this Agreement, including all copies and extracts of
         documents, within thirty (30) days of the request of the other party;
         PROVIDED, HOWEVER, one copy of such Confidential Information may be
         retained for legal purposes.

7.1.3    EXCEPTIONS TO CONFIDENTIAL INFORMATION. Confidential Information shall
         not include any information, which the receiving party can prove by
         competent written evidence:

         i)       is now, or hereafter becomes, through no act or failure to act
                  on the part of the receiving party, generally known or
                  available;

         ii)      is known by the receiving party at the time of receiving such
                  information, as evidenced by its records;

         iii)     is hereafter furnished to the receiving party without
                  restriction as to disclosure or use by a Third Party lawfully
                  entitled to furnish such information;

         iv)      is independently developed by the employees, agents or
                  contractors of the receiving party without the aid,
                  application or use of the disclosing party's Confidential
                  Information;

         vi)      is the subject of a written permission to disclose provided by
                  the disclosing party; or

         vii)     is provided by the disclosing party to a Third Party without
                  restriction as to confidentiality.

         A party may also disclose Confidential Information of the other party
         where required to do so by law or legal process; PROVIDED, HOWEVER,
         that, in such event, the party required to disclose such information
         shall give advance written notice of such disclosure to the other party
         and will cooperate with the other party's efforts to seek, at the
         request and expense

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         of the other party, all confidential treatment and protection for such
         disclosure as is permitted by applicable law.

7.1.4    CONFIDENTIAL FINANCIAL INFORMATION. The parties agree that the material
         financial terms of this Agreement will be considered Confidential
         Information of both parties. Notwithstanding the foregoing, either
         party may disclose such terms in legal proceedings or as are required
         to be disclosed in its financial statements, by law, or under an
         obligation of confidentiality to bona fide potential sublicensees.
         Either party shall have the further right to disclose the material
         financial terms of this Agreement under an obligation of
         confidentiality to any potential acquirer, merger partner, bank,
         venture capital firm, or other financial institution to obtain
         financing. Notwithstanding the foregoing, the parties shall agree upon
         a press release to announce the execution of this Agreement.
         Thereafter, Aurora and Senomyx may each disclose to Third Parties the
         information contained in such press release without the need for
         further approval by the other party.

7.1.5    CONFIDENTIAL RESEARCH INFORMATION. The parties agree that information
         developed using an Assay Platform will be considered Confidential
         Information of both parties and shall be subject to the confidentiality
         requirements of this Article 7. Notwithstanding the foregoing, either
         party may disclose and use information developed using an Assay
         Platform that is not specific to a Target proposed by Senomyx for
         screen development and screening under an obligation of confidentiality
         to bona fide sublicensees.

7.2      PERMITTED USE AND DISCLOSURES. Each party may use or disclose
         Confidential Information disclosed to it by the other party to the
         extent such information is included in the Aurora Technology, Senomyx
         Technology or Joint Patent Rights, and to the extent such use or
         disclosure is reasonably necessary and permitted in the exercise of the
         rights granted hereunder in filing or prosecuting patent applications,
         prosecuting or defending litigation, complying with applicable
         governmental regulations or court orders or otherwise submitting
         information to tax or other governmental authorities, conducting
         clinical trials, or making a permitted sublicense or otherwise
         exercising rights expressly granted to the other party pursuant to the
         terms of this Agreement; PROVIDED, HOWEVER, that if a party is required
         to make any such disclosure of the other party's Confidential
         Information, other than pursuant to a confidentiality agreement, it
         will give reasonable advance notice of such disclosure to the other
         party where reasonably possible and, save to the extent inappropriate
         in the case of patent applications, will use its reasonable efforts to
         secure confidential treatment of such Confidential Information in
         consultation with the other party prior to such disclosure (whether
         through protective orders or otherwise) and disclose only the minimum
         necessary to comply with such requirements.

7.3      USE OF DATA FOR PROMOTIONAL PURPOSES. Either party may (i) make public
         statements regarding Products by announcing the achievement of
         milestones and fees therefor, following consultation with the other
         party and with the written consent of the other party

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         to the form and content of the public statement, and (ii) without the
         prior consent of the other party, make public statements regarding the
         overall success rate(s) achieved by and/or for its customers with the
         use of Aurora Technology or Senomyx Technology; PROVIDED, HOWEVER, that
         it may not disclose any chemical structures, screens or the other
         party's identity.

7.4      PUBLICATION OF RESULTS. Subject to this Article 7, results and data
         obtained by either party in the course of the collaboration, including,
         but not limited to, the execution of a Work Plan or an Aurora Screening
         Program pursuant to this Agreement, may be submitted for publication by
         Senomyx in accordance with Senomyx's customary practices; PROVIDED,
         HOWEVER, that Senomyx shall credit Aurora in such publication as the
         developer and/or provider of the technology that produced, in part, the
         published results or data. Senomyx shall send a copy of the proposed
         publication to Aurora at least forty-five (45) days prior to submitting
         the paper to a publisher and shall allow Aurora thirty (30) days from
         the date of receipt in which to determine whether such publication
         contains subject matter for which patent protection should be sought
         prior to disclosure, or otherwise contains Aurora Confidential
         Information. Senomyx shall comply with Aurora's request to delete
         references to Aurora's Confidential Information in any such paper and
         agrees to withhold publication of the same for an additional one
         hundred and eighty (180) days to permit Aurora to obtain patent
         protection, if Aurora deems it necessary, in accordance with the terms
         of this Agreement. If no answer is received from Aurora within thirty
         (30) days of receipt of the proposed publication, Senomyx shall be free
         to submit such proposed publication.

7.5      PUBLICITY. Except as required by law and as provided in this Article 7,
         neither party may make any public announcement or otherwise disclose
         the terms of this Agreement without the prior written consent of the
         other party, which consent shall not be unreasonably withheld.

8.       PATENT PROSECUTION AND MAINTENANCE

         The control and expense of the filing, prosecution (including an
         opposition or interference) and maintenance of Patent Rights or other
         intellectual property rights claiming Inventions made solely by a party
         will be the sole responsibility of the party that made such Invention,
         and the party not filing the patent application will cooperate in such
         filing, prosecution and maintenance. Senomyx and Aurora will determine
         by mutual agreement which party will be responsible for, and will
         cooperate in, the filing, prosecution and maintenance of Joint Patent
         Rights and will share equally in the expenses incurred with respect
         thereto.

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9.       WARRANTIES AND INDEMNIFICATION

9.1      MUTUAL REPRESENTATIONS AND WARRANTIES. Each party hereby makes the
         following representations and warranties to the other party:

9.1.1    CORPORATE POWER. Each party hereby represents and warrants that such
         party (a) is duly organized and validly existing under the laws of the
         state of its incorporation and has full corporate power and authority
         to enter into this Agreement and to carry out the provisions hereof;
         (b) has the requisite power and authority and the legal right to own
         and operate its property and assets, to lease the property and assets
         it operates under lease, and to carry on its business as it is now
         being conducted; and (c) is in compliance with all requirements of
         applicable law, except to the extent that any noncompliance would not
         have a material adverse effect on its ability to perform its
         obligations under the Agreement.

9.1.2    DUE AUTHORIZATION. Each party hereby represents and warrants that such
         party (a) has the requisite power and authority and the legal right to
         enter into the Agreement and to perform its obligations hereunder; and
         (b) has taken all necessary action on its part to authorize the
         execution and delivery of the Agreement and to authorize the
         performance of its obligations hereunder and the grant of rights
         extended by it hereunder.

9.1.3    BINDING AGREEMENT. Each party hereby represents and warrants to the
         other that (a) this Agreement has been duly executed and delivered on
         its behalf and is a legal and valid obligation binding upon it and is
         enforceable in accordance with its terms; (b) the execution, delivery
         and performance of this Agreement by such party does not conflict with
         any agreement, instrument or understanding, oral or written, to which
         it is a party or by which it may be bound, nor violate any law or
         regulation of any court, governmental body or administrative or other
         agency having authority over it; and (c) all necessary consents,
         approvals and authorizations of all governmental authorities and other
         persons required to be obtained by it in connection with the Agreement
         have been obtained.

9.2      WARRANTIES REGARDING SENOMYX TECHNOLOGY. Senomyx represents and
         warrants to Aurora as of the Effective Date the following:

9.2.1    To the best knowledge of Senomyx as of the Effective Date: (a) Senomyx
         has the lawful right to license the Senomyx Technology to Aurora in
         accordance with the terms of this Agreement; (b) the Senomyx Patent
         Rights were properly filed and prosecuted; and (c) no Third Party suit
         exists relating to the Senomyx Patent Rights.

9.2.2    EXCEPT AS EXPRESSLY SET FORTH HEREIN, SENOMYX (INCLUDING ITS OFFICERS,
         EMPLOYEES AND AGENTS) EXPRESSLY DISCLAIMS ANY REPRESENTATIONS AND
         WARRANTIES, WHETHER EXPRESS OR IMPLIED, RELATING TO SENOMYX TECHNOLOGY.
         SENOMYX FURTHER DISCLAIMS

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         ANY EXPRESS OR IMPLIED WARRANTY (a) OF MERCHANTABILITY OR FITNESS FOR A
         PARTICULAR PURPOSE OF SENOMYX TECHNOLOGY; (b) THAT THE PRACTICE OF
         SENOMYX TECHNOLOGY WILL NOT INFRINGE A PATENT, COPYRIGHT, TRADEMARK OR
         OTHER RIGHT OF A THIRD PARTY; AND (c) REGARDING THE PATENTABILITY OF
         ANY SENOMYX TECHNOLOGY, INCLUDING SENOMYX TECHNOLOGY CLAIMED IN PATENT
         APPLICATIONS AS PART OF SENOMYX PATENT RIGHTS.

9.3      SENOMYX INDEMNIFICATION.

9.3.1    Senomyx hereby agrees to indemnify, defend and hold Aurora, and its
         respective officers, directors, employees and agents (collectively, the
         "Aurora Indemnitees") harmless from and against all damages, losses,
         liabilities, expenses and costs or other amounts payable to a Third
         Party, including reasonable attorneys' fees and costs of litigation,
         resulting from a claim, demand, action, suit or other proceeding
         brought or threatened by a Third Party against an Aurora Indemnitee
         based on (a) any development, manufacture, use, handling, storage, sale
         or other disposition of a Development Compound or Product by or through
         Senomyx or its Affiliates, Licensees or permitted sublicensees, (b) the
         practice by Senomyx of any license granted hereunder, or (c)
         infringement by Aurora of Patent Rights of any Third Party as a result
         of using a Target in an Assay Platform, or Compound Supply provided
         under this Agreement by Senomyx; except to the extent such damages or
         other amounts payable are attributable to: (i) a violation of any
         contractual or fiduciary duty owed by any Aurora Indemnitee to a Third
         Party, (ii) any material breach of this Agreement by an Aurora
         Indemnitee, or (iii) trade secret misappropriation or patent
         infringement by Aurora of screen components (other than a Target or
         Compound Supply) that are Controlled by a Third Party or are covered by
         a Third Party's Patent Rights. IN NO EVENT SHALL SENOMYX BE LIABLE FOR
         ANY INCIDENTAL OR CONSEQUENTIAL DAMAGES SUFFERED BY AURORA RESULTING
         FROM THE EXERCISE OF ANY RIGHTS GRANTED IN ACCORDANCE WITH THIS
         AGREEMENT.

9.3.2    With respect to rights licensed to Aurora by the [...***...] or by
         [...***...], Senomyx hereby agrees to indemnify, defend and hold
         harmless [...***...], as appropriate, and their respective officers,
         directors, employees, sponsors and agents from and against all damages
         or other amounts payable to a Third Party (including product liability)
         resulting or arising from Senomyx's use of the rights granted herein to
         the extent that such indemnification by Senomyx is required by
         [...***...] pursuant to agreements between [...***...] and Aurora or
         between [...***...] and Aurora.

9.4      WARRANTIES RELATING TO AURORA TECHNOLOGY. Aurora represents and
         warrants to Senomyx as of the Effective Date the following:

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9.4.1    To the best knowledge of Aurora as of the Effective Date: (a) Aurora
         has the lawful right to license (or sublicense, as the case may be) the
         Aurora Technology to Senomyx in accordance with the terms of this
         Agreement; (b) the Aurora Patent Rights were properly filed and
         prosecuted; and (c) no Third Party suit against Aurora exists relating
         to the Aurora Patent Rights.

9.4.2    EXCEPT AS EXPRESSLY SET FORTH HEREIN, AURORA (INCLUDING ITS OFFICERS,
         EMPLOYEES AND AGENTS) EXPRESSLY DISCLAIMS ANY REPRESENTATIONS AND
         WARRANTIES OF ANY KIND, WHETHER EXPRESS OR IMPLIED, RELATING TO AURORA
         TECHNOLOGY OR AURORA REPORTERS. AURORA FURTHER DISCLAIMS ANY EXPRESS OR
         IMPLIED WARRANTY (a) OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR
         PURPOSE OF AURORA TECHNOLOGY OR AURORA REPORTERS; (b) THAT THE PRACTICE
         OF AURORA TECHNOLOGY OR AURORA REPORTERS WILL NOT INFRINGE A PATENT,
         COPYRIGHT, TRADEMARK, TRADE SECRET OR OTHER RIGHT OF A THIRD PARTY; AND
         (c) REGARDING THE PATENTABILITY OF ANY AURORA TECHNOLOGY OR AURORA
         REPORTERS, INCLUDING AURORA TECHNOLOGY OR AURORA REPORTERS CLAIMED IN
         PATENT APPLICATIONS AS PART OF AURORA PATENT RIGHTS.

9.5      AURORA INDEMNIFICATION.

9.5.1    Aurora hereby agrees to indemnify, defend and hold Senomyx and its
         respective officers, directors, employees and agents (collectively the
         "Senomyx Indemnitees") harmless from and against all damages, losses,
         liabilities, expenses and costs or other amounts payable to a Third
         Party, including reasonable attorneys' fees and costs of litigation,
         resulting from a claim, demand, action, suit, or other proceeding
         brought or threatened by a Third Party against a Senomyx Indemnitee
         based on Aurora's gross negligence, intentional misconduct, trade
         secret misappropriation or material misrepresentations contained
         herein. IN NO EVENT SHALL AURORA BE LIABLE FOR ANY INDIRECT, INCIDENTAL
         ,SPECIAL OR CONSEQUENTIAL DAMAGES SUFFERED BY SENOMYX RESULTING FROM
         THE EXERCISE OF ANY RIGHTS GRANTED IN ACCORDANCE WITH THIS AGREEMENT.

9.5.2    Aurora hereby agrees to indemnify, defend and hold [...***...], and the
         [...***...] and its respective officers, sponsors, directors, employees
         and agents (collectively the "IP Indemnitees") harmless from and
         against all damages or other amounts payable to a Third Party,
         including reasonable attorneys' fees and costs of litigation, resulting
         or arising from the exercise of rights under the license granted from
         Senomyx to Aurora under Section 4.2 and pursuant to any agreement
         between [...***...] and Senomyx, including product liability.

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10.      TERM AND TERMINATION

10.1     TERM. The term of this Agreement will begin on the Effective Date and
         shall continue until [...***...], unless terminated earlier in
         accordance with the provisions of Section 10.2, 10.3 or 10.4 hereof
         (the "Term").

10.2     TERMINATION BY [...***...].

10.3     TERMINATION BY MUTUAL AGREEMENT. Notwithstanding Section 10.2, the
         parties may terminate this Agreement at any time, in whole or in part,
         by mutual written agreement executed by both Aurora and Senomyx.

10.4     TERMINATION FOR BREACH. Aurora shall have the right to terminate this
         Agreement at any time if Senomyx fails to make any payment when due
         under this Agreement, provided that Senomyx has not made such payment
         within [...***...] after written notice thereof by Aurora. Either party
         shall have the right to terminate this Agreement at any time for a
         material breach of this Agreement (other than non-payment) by the other
         party, provided that the breaching party has not cured such breach
         within [...***...] after written notice thereof by the non-breaching
         party. The non-breaching party, upon termination of this Agreement, may
         seek actual or general damages and remedies available to it at law or
         in equity. NO PUNITIVE OR CONSEQUENTIAL DAMAGES MAY BE SOUGHT BY EITHER
         PARTY.

10.5     EFFECT OF TERMINATION.

10.5.1   Upon termination of this Agreement pursuant to Section 10.2, (i)
         Senomyx shall have no right to practice within the Aurora Patent Rights
         or use any of the Aurora Technology or any Aurora Reporter, unless
         Senomyx pays to Aurora an early termination fee of [...***...] within
         [...***...], and (ii) Senomyx shall pay Aurora additional research
         support in accordance with Section 3.1 for a period of [...***...]
         following the date Senomyx notifIES Aurora of such termination.

10.5.2   Upon termination of this Agreement pursuant to Section 10.3, (i)
         Senomyx shall have no right to practice within the Aurora Patent Rights
         or use any of the Aurora Technology or any Aurora Reporter, and (ii)
         all rights, title or interest in, or other incidents of ownership
         under, the Aurora Technology and Aurora Reporters shall revert to and
         become the sole property of Aurora, unless otherwise agreed upon in
         writing by the parties on or before the effective date of such
         termination.

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10.5.3   Upon termination of this Agreement pursuant to Section 10.4, (i)
         Senomyx shall have no right to practice within the Aurora Patent Rights
         or use any of the Aurora Technology or any Aurora Reporter, and (ii)
         all rights, title or interest in, or other incidents of ownership
         under, the Aurora Technology and Aurora Reporters shall revert to or
         become the property of Aurora.

10.5.4   Expiration or termination of this Agreement shall not relieve either
         party of any obligation accruing prior to such expiration or
         termination.

10.6     SURVIVAL. The obligations and rights of the parties under Sections
         2.4.5, 4.3, 5.4, 10.5 and 10.6 and Articles 1, 7, 9 and 11 shall
         survive termination or expiration of this Agreement.

11.      MISCELLANEOUS

11.1     ASSIGNMENT. Notwithstanding any provision of this Agreement to the
         contrary, neither party may assign any of its rights or obligations
         under this Agreement in any country to any Third Party without the
         prior written consent of the non-assigning party, which consent shall
         not be unreasonably withheld; PROVIDED, HOWEVER, that either party may
         assign its rights and obligations under this Agreement without the
         consent of the other party (i) in connection with the transfer or sale
         of all or substantially all of its assets, or (ii) to any Affiliate. In
         the event of such transaction, however, intellectual property rights
         (including Know-How) of a party to such transaction other than one of
         the parties to this Agreement, shall not be included in the technology
         licensed hereunder. Notwithstanding the foregoing, any such assignment
         to an Affiliate shall not relieve the assigning party of its
         responsibilities for performance of its obligations under this
         Agreement. This Agreement shall survive any merger or consolidation of
         either party with or into another party and no consent for any such
         merger, consolidation or similar reorganization shall be required
         hereunder.

11.2     BINDING EFFECT. This Agreement shall be binding upon and inure to the
         benefit of the successors and permitted assigns of the parties. Any
         assignment not in accordance with this Agreement shall be void.

11.3     FORCE MAJEURE. Neither party shall lose any rights hereunder or be
         liable to the other party for damages or losses on account of failure
         of performance by the defaulting party if the failure is occasioned by
         war, fire, explosion, flood, El Nino, earthquake, strike, lockout,
         embargo, act of God, or any other similar cause beyond the control of
         the defaulting party; PROVIDED, HOWEVER, that the party claiming force
         majeure has exerted all reasonable efforts to avoid or remedy such
         force majeure and thereafter takes all reasonable steps to mitigate any
         such delay in performance hereunder and any damages that may be
         incurred by the other party thereby.

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11.4     NOTICES. Any notices or communications provided for in this Agreement
         to be made by either party to the other party shall be in writing, in
         English, and shall be made by prepaid air mail or overnight carrier
         with return receipt addressed to the other party at its address set
         forth below. Any such notice or communication may also be given by hand
         or facsimile to the appropriate designation. Notices shall be sent:

                  If to Senomyx, to:

                  Senomyx, Inc.
                  11099 North Torrey Pines Road
                  La Jolla, CA  92037
                  Facsimile number: (858) 404-0754
                  Attention: Vice President, Corporate Counsel
                  with a copy to the President

                  If to Aurora, to:

                  Aurora Biosciences Corporation
                  11010 Torreyana Road
                  San Diego, CA 92121
                  Facsimile number: (858) 404-6743
                  Attention:  General Counsel
                  with a copy to the President

         Either party may by like notice specify or change an address to which
         notices and communications shall thereafter be sent. Notices sent by
         mail, facsimile or overnight carrier shall be effective upon receipt
         and notices given by hand shall be effective when delivered.

11.5     GOVERNING LAW AND JURISDICTION. This Agreement shall be governed by the
         laws of the State of California, as such laws are applied to contracts
         entered into and to be performed entirely within such state.

11.6     WAIVER. Except as specifically provided for herein, the waiver from
         time to time by either party of any right or the failure to exercise
         any remedy shall not operate or be construed as a continuing waiver of
         the same right or remedy or any of the other of such party's rights or
         remedies provided in this Agreement.

11.7     SEVERABILITY. If any term, covenant or condition of this Agreement or
         the application thereof to any party or circumstance shall, to any
         extent, be held to be invalid or unenforceable, then the remainder of
         this Agreement, or the application of such term, covenant or condition
         to parties or circumstances other than those as to which it is held
         invalid or unenforceable, shall not be affected thereby and each term,
         covenant or

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         condition of this Agreement shall be valid and enforced to the fullest
         extent permitted by law. The parties covenant and agree to renegotiate
         any such term, covenant or condition or the application thereof in good
         faith in order to provide a reasonably acceptable alternative to the
         term, covenant or condition of this Agreement or the application
         thereof that is invalid or unenforceable, it being the intent of the
         parties that the basic purposes of this Agreement are to be
         effectuated.

11.8     INDEPENDENT CONTRACTORS. It is expressly agreed that Aurora and Senomyx
         shall be independent contractors and that the relationship between the
         parties shall not constitute a partnership or agency of any kind.
         Neither Aurora nor Senomyx shall have the authority to make any
         statements, representations or commitments of any kind, or to take any
         action, which shall be binding on the other party, without the prior
         written authorization of the other party to do so.

11.9     COUNTERPARTS. This Agreement may be executed in two (2) or more
         counterparts, each of which shall be deemed an original, but all of
         which together shall constitute one and the same instrument.

11.10    ENTIRE AGREEMENT; AMENDMENT. This Agreement sets forth all of the
         covenants, promises, agreements, warranties, representations,
         conditions and understandings between the parties, and supersedes and
         terminates all prior agreements and understandings between the parties,
         with respect to the subject matter hereof. There are no covenants,
         promises, agreements, warranties, representations, conditions or
         understandings, either oral or written, between the parties other than
         as set forth herein. No subsequent alteration, amendment, change or
         addition to this Agreement shall be binding upon the parties unless
         reduced to writing and signed by the respective authorized officers of
         the parties. This Agreement shall not be strictly construed against
         either party. Any conflict between the terms set forth in the text of
         this Agreement and the terms of any Exhibit hereto shall be resolved in
         favor of the text of this Agreement.

11.11    NO THIRD PARTY BENEFICIARIES. No Third Party, including any employee of
         any party to this Agreement (except as specifically provided in
         Sections 9.3 and 9.5), shall have or acquire any rights by reason of
         this Agreement. Nothing contained in this Agreement shall be deemed to
         constitute the parties partners with each other or any Third Party.

11.12    CONSTRUCTION. The term "Article" or "Section" can refer to any single
         paragraph level found herein or any collection of multiple paragraphs
         thereunder.

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11.13    DISPUTE RESOLUTION. The parties recognize that disputes as to certain
         matters may from time to time arise during the Term, which relate to
         either party's rights and/or obligations hereunder. It is the objective
         of the parties to establish procedures to facilitate the resolution of
         disputes arising under this Agreement in an expedient manner by mutual
         cooperation and without resort to arbitration. The parties agree that
         prior to any arbitration concerning this Agreement, Senomyx's President
         and Aurora's President will meet in person or by video-conferencing in
         a good faith effort to resolve any disputes concerning this Agreement.
         Within thirty (30) days of a formal request by either party to the
         other party, either party may, by written notice to the other party,
         have such dispute referred to their respective officers designated or
         their successors, for attempted resolution by good faith negotiations,
         such good faith negotiations to begin within thirty (30) days after
         such notice is received. Any dispute arising out of or relating to this
         Agreement which is not resolved between the parties or the designated
         officers of the parties pursuant to this Section 11.13 shall be
         resolved by final and binding arbitration conducted in San Diego,
         California (unless the parties mutually agree to another location) in
         accordance with Sections 1282 through 1288 of the California Code of
         Civil Procedure. The arbitration shall be conducted by three (3)
         arbitrators who are knowledgeable in the subject matter which is at
         issue in the dispute. One (1) arbitrator will be selected by Senomyx
         and one (1) arbitrator will be selected by Aurora. The third arbitrator
         will be selected by mutual agreement of the two (2) arbitrators
         selected by the parties. In conducting the arbitration, the arbitrators
          shall (i) determine what discovery will be permitted, consistent with
         the goal of limiting the cost and time which the parties must expend
         for discovery (and provided that the arbitrators shall permit such
         discovery they deem necessary to permit an equitable resolution of the
         dispute), (ii) ensure that the total time of the arbitration from
         filing to a final decision or executed settlement agreement is less
         than six (6) months, and (iii) be able to decree any and all relief of
         an equitable nature, including, but not limited to, such relief as a
         temporary restraining order, a preliminary injunction, a permanent
         injunction, specific performance or repletion of property. The
         arbitrators shall also be able to award actual or general damages, but
         shall not award any other form of damage (e.g., consequential, punitive
         or exemplary damages). The parties shall share equally the arbitrator's
         fees and expenses pending the resolution of the arbitration, unless the
         arbitrators, pursuant to their right, but not their obligations,
         require the non-prevailing party to bear all or any portion of the
         costs of the prevailing party. The decision of the arbitrators shall be
         final and binding on the parties and may be sued on or enforced by the
         party in whose favor it runs in any court of competent jurisdiction at
         the option of such party. Notwithstanding anything to the contrary in
         this Section 11.13, either party may seek immediate injunctive or other
         interim relief from any court of competent jurisdiction with respect to
         any breach of Articles 4 or 7 hereof, or otherwise to enforce and
         protect the Patent Rights, copyrights, trademarks, or other
         intellectual property rights Controlled by such party. In addition,
         arbitration shall not be used to resolve disputes concerning Patent
         Rights. Disputes concerning Patent Rights, including, but not limited
         to, disputes concerning patent

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         ownership, claim language, claim scope and issues of validity shall be
         settled in a court of law. Any arbitration ruling that relies on an
         interpretation of Patent Rights shall have no binding effect in a court
         of law on any Patent Rights related to this Agreement, unless such
         Patent Rights have been adjudicated in a court of law. In no event
         shall a demand for arbitration be made after the date when the
         institution of a legal or equitable proceeding based on such claim,
         dispute or other matter in question would be barred by the applicable
         statute of limitations.

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         IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their duly authorized representatives as of the Effective Date.

SENOMYX, INC.                        AURORA BIOSCIENCES CORPORATION

By: /s/ PAUL A. GRAYSON              By: /s/ STUART J. M. COLLINSON
   ---------------------------          --------------------------------
Name:    Paul A. Grayson             Name:    Stuart J. M. Collinson
Title:   President and CEO           Title:   Chairman, CEO and
                                                       President

Date:    November 1, 2000            Date:    November 1, 2000
     -------------------------            ------------------------------

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                                LIST OF EXHIBITS

EXHIBIT 1:                 LIST OF AURORA PATENT RIGHTS

EXHIBIT 2:                 LIST OF SENOMYX PATENT RIGHTS

EXHIBIT 3:                 DESCRIPTION OF REPORTERS

EXHIBIT 4:                 STOCK PURCHASE AGREEMENT

EXHIBIT 5:                 SENOMYX TARGET LIST

EXHIBIT 6:                 ASSAY PLATFORM VALIDATION CRITERIA

EXHIBIT 7:                 VIPR AND VIPR II PERFORMANCE CRITERIA AND SERVICE
                           AND SUPPORT

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                                    EXHIBIT 1

                          LIST OF AURORA PATENT RIGHTS

[...***...]

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[...***...]

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[...***...]

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                                    EXHIBIT 2

                          LIST OF SENOMYX PATENT RIGHTS

[...***...]

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[...***...]

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                                    EXHIBIT 3

                            DESCRIPTION OF REPORTERS

[...***...]

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                                    EXHIBIT 5

                               SENOMYX TARGET LIST

Sequences listed as an attachment to this Exhibit, and incorporated by
reference, include the following molecules:

     [...***...]

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                                    EXHIBIT 6

                       ASSAY PLATFORM VALIDATION CRITERIA

              [...***...]

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                                    EXHIBIT 7

                           PERFORMANCE SPECIFICATIONS

[...***...]

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                                                                   Exhibit 10.17

                                           *** TEXT OMITTED AND FILED SEPARATELY
                                                CONFIDENTIAL TREATMENT REQUESTED
                                          UNDER 17 C.F.R. SECTIONS 200.80(b)(4),
                                                              200.83 AND 230.406

                             COLLABORATIVE RESEARCH
                              AND LICENSE AGREEMENT

                                     BETWEEN

                                  SENOMYX, INC.

                                       AND

                                KRAFT FOODS, INC.

                                       1
<PAGE>

                  COLLABORATIVE RESEARCH AND LICENSE AGREEMENT

This Agreement is entered into as of the Effective Date by and between Senomyx,
Inc., a Delaware Corporation having offices at 11099 North Torrey Pines Road, La
Jolla, CA 92037 ("Senomyx") and Kraft Foods, Inc., a Delaware Corporation having
offices at 801 Waukegan Road, Glenview, IL 60025 ("Kraft").

                                   BACKGROUND

Senomyx conducts research in the field of chemosensation, an objective of which
is to study potential biological targets and develop assays for use in the
discovery and commercialization of products in taste and olfaction. Kraft is in
the business of developing, manufacturing and marketing consumer food products.
Senomyx and Kraft desire to collaborate in a research program to: (i) discover
compounds that [...***...] for use in [...***...]; and (ii) discover compounds
that [...***...] for use in [...***...].

NOW, THEREFORE, in consideration of the foregoing premises and of the covenants,
representations and agreements set forth below, the parties hereby agree as
follows:

                                  THE AGREEMENT

1.       DEFINITIONS. Certain terms set forth in this Agreement with initial
         capitals are defined in Appendix A, which is incorporated herein by
         reference.

2.       STEERING COMMITTEE. No later than ten days after the Effective Date,
         the parties will establish a joint steering committee (the "Steering
         Committee"). The Steering Committee will manage the Collaborative
         Program and will (i) provide strategic direction and performance
         criteria for the Collaborative Program; (ii) monitor progress and
         communicate status of the Collaborative Program; (iii) facilitate the
         cooperation of the parties under the Collaborative Program; and (iv)
         confirm completion of milestones under the Collaborative Program. The
         Steering Committee will consist of two representatives designated by
         Senomyx and two representatives designated by Kraft. Each member of the
         Steering Committee will have one vote. The Steering Committee will meet
         no later than thirty days after the Effective Date and at least four
         times per year during the Collaborative Period using mutually agreed
         upon meeting locations and formats including tele-conferencing and
         video-conferencing. On an alternating basis, one party will promptly
         prepare and deliver to the members of the Steering Committee minutes of
         such meetings for review and approval of both parties. Decisions in the
         Steering Committee will be made by

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         unanimous vote, at a meeting where all four voting representatives are
         present. All unresolved disputes will be settled in accordance with
         Section 18.4, or as otherwise mutually agreed upon in writing.

3.       COLLABORATIVE PROGRAM. The parties will collaborate in the conduct of
         the Collaborative Program in accordance with the Research Plan during
         the Collaborative Period. The Collaborative Program will consist of two
         phases: the [...***...] Phase and the [...***...] Phase, which may
         overlap.

         3.1      [...***...] PHASE.

                  (A)      Within [...***...] of the Effective Date, Kraft will,
                           at its expense, supply Senomyx with [...***...]
                           Tastants for screening in accordance with the
                           Research Plan. During the [...***...] Phase, Kraft
                           may provide additional [...***...] Tastants for
                           profiling as agreed to In writing by the parties and
                           approved by the Steering Committee.

                  (B)      Upon receipt of the [...***...] Tastants, Senomyx
                           will perform the activities outlined in the Research
                           Plan using reasonable efforts, and the resources
                           provided under Section 9.1.

                  (C)      Within [...***...] of receipt of the report regarding
                           the [...***...] Compounds, Kraft will perform sensory
                           testing and other evaluations on a limited number of
                           the [...***...] Compounds and may select [...***...]
                           Compound(s) for further development by notifying
                           Senomyx of such selection in writing by the end of
                           such [...***...] period. Such [...***...] period may
                           be extended by agreement; such agreement will not be
                           unreasonably withheld. [...***...] Compounds, if any,
                           chosen for further development become Selected
                           [...***...] Compounds.

                  (D)      Senomyx's obligations during the [...***...] Phase
                           will be completed upon the earlier of (i)
                           [...***...]; or (ii) upon [...***...]. If necessary,
                           Senomyx may provide additional optimization as agreed
                           to in writing by the parties and approved by the
                           Steering Committee.

         3.2      [...***...] PHASE.

                  (A)      Kraft may request that Senomyx pursue the
                           identification of [...***...] Compounds upon the
                           earlier of (i) [...***...]; or (ii) [...***...]

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                           [...***...].

                  (B)      Upon initiation of the [...***...] Phase, Kraft will,
                           at its expense, supply Senomyx with [...***...]
                           Tastants for screening. During the [...***...] Phase,
                           Kraft may provide additional [...***...] Tastants for
                           profiling as agreed to in writing by the parties and
                           approved by the Steering Committee.

                  (C)      Upon receipt of the [...***...] Tastants, Senomyx
                           will perform the activities outlined in the Research
                           Plan using reasonable efforts, and the resources
                           provided under Section 9.1.

                  (D)      Within [...***...] of receipt of the report regarding
                           the [...***...] Compounds, Kraft will perform sensory
                           testing and other evaluations on a limited number of
                           the [...***...] Compounds; and may select [...***...]
                           Compound(s) for further development by notifying
                           Senomyx of such selection in writing by the end of
                           such [...***...] period. Such [...***...] period may
                           be extended by agreement; such agreement will not be
                           unreasonably withheld. [...***...] Compounds, if any,
                           chosen for further development become Selected
                           [...***...] Compounds.

                  (E)      Senomyx's obligations during the [...***...] Phase
                           will be completed upon the earlier of (i)
                           [...***...]; or (ii) upon [...***...]. If necessary,
                           Senomyx may provide additional optimization as agreed
                           to in writing by the parties and approved by the
                           Steering Committee.

         3.3      PRODUCT DEVELOPMENT AND COMMERCIALIZATION.

                  (A)      PRODUCT DEVELOPMENT. Within [...***...] of the
                           selection of a Selected Compound, Kraft will prepare
                           a plan for Product Development for approval by the
                           Steering Committee, which will be attached as
                           Appendix D to this Agreement, and incorporated into
                           the Agreement by reference. Kraft will perform the
                           Product Development outlined in Appendix D.

                  (B)      PRODUCT COMMERCIALIZATION. Within [...***...] of the
                           completion of the Product Development plan , Kraft
                           will prepare a plan for Product Commercialization for
                           approval by the Steering Committee, which will be
                           attached as Appendix D to this Agreement, and
                           incorporated into the

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                  Agreement by reference. Kraft will perform the Product
                  Commercialization outlined in Appendix F.

                  (C)      Kraft will be responsible, [...***...] for all
                           formulation and regulatory approval of Products
                           arising out of this Agreement. [...***...] Senomyx
                           will cooperate to the extent reasonably necessary to
                           permit Kraft to perform the foregoing activities.

                  (D)      If Kraft elects to abandon, discontinue, or forgo
                           development or commercialization of any Product or
                           fails after a reasonable time to initiate development
                           or commercialization of any Product in any country
                           pursuant to Appendix D, Kraft's licenses under
                           Section 10 of this Agreement to such Product will
                           terminate and the right to make, have made, use, sell
                           and have sold such Product in such particular country
                           will revert to Senomyx. Kraft will have no obligation
                           for the Product or country where Kraft's rights are
                           terminated under this Section 3.3.

4.       PRINCIPAL SCIENTISTS. The principal scientists who will direct the
         respective research and development responsibilities of each party will
         be designated in writing by the Parties at the first meeting of the
         Steering Committee.

5.       COLLABORATION WITH AN AFFILIATE OR THIRD PARTY. During the Term,
         Senomyx will have the right to enter into the Collaborative Program
         with its Affiliates or with Third Parties including Collaborative
         Programs to discover compounds that [...***...] for use outside the
         applicable Field.

6.       LAW AND REGULATION. The Compounds, Selected Compounds and Materials
         provided by one party to the other under this Agreement must be used in
         compliance with all applicable laws and regulations. Senomyx and Kraft
         each certifies that it conducts tests IN VITRO or other tests that are
         only used for laboratory research purposes and that all Materials and
         chemicals that either party receives from the other under this
         Agreement will actually be used for these purposes only.

7.       SCIENTIFIC AND MANAGEMENT AUTHORITY. Scientific and management
         authority and responsibility for activities conducted under the
         Research Plan and Product Development and Commercialization will be
         governed by the Steering Committee; provided, however, that after the
         Collaborative Period, the parties will agree in writing to appoint a
         new committee to manage the activities under this Agreement.

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8.       REPORTING. Each party will report to the other a written summary of
         results of research and development work it carries out, if any, within
         thirty days of the end of each calendar quarter. Each party agrees to
         prepare and exchange written and electronic reports concerning any
         results and data that must be used by either party as supporting
         information for any regulatory filings. The exchange of such report may
         be reasonably supplemented, at the request of the party receiving a
         report, by correspondence and/or upon reasonable prior notice, visits
         to the other party's facilities.

9.       FINANCIAL TERMS.

         9.1      ANNUAL RESEARCH SUPPORT. Each year during the Collaborative
                  Period Kraft will pay Senomyx $1,375,000 (which represents
                  the full time equivalent of [...***...] Senomyx scientists at
                  an annual rate of [...***...] per scientist based on a minimum
                  of [...***...] hours per year), such rate to be increased for
                  inflation using the Aon Consulting/Radford Division report for
                  industry compensation each year; provided, however, that if in
                  any calendar year the annual amount to be paid to Senomyx
                  exceeds [...***...], Kraft may elect, in its sole discretion,
                  to decrease the number of full time equivalents such that the
                  annual amount to be paid to Senomyx remains at [...***...].
                  These payments will be made in advance and, at a minimum, on
                  an equal quarterly basis. The first payment will be made
                  within [...***...] following the Effective Date. These
                  payments are inclusive of overhead, labor, and supplies. These
                  payments do not include (i) Kraft's costs associated with
                  providing [...***...] Tastants and [...***...] Tastants; (ii)
                  the costs of any unanticipated materials as requested and
                  agreed to by the parties; or (iii) the costs of high
                  throughput screening over 50,000 data points. Additional
                  funding, if any, will be proposed to the Steering Committee
                  and agreed to in writing by the parties.

         9.2      MILESTONE PAYMENTS. Kraft will pay Senomyx the following
                  non-creditable, non-refundable milestone payments within
                  thirty days of notification of the following milestone events:

                  (A)      [...***...] upon identification of the first relevant
                           Receptor for either a [...***...] Tastant or a
                           [...***...] Tastant;

                  (B)      [...***...] upon submission of the first Compound
                           data package to Kraft;

                  (C)      [...***...] upon the selection of each Selected
                           Compound by Kraft, which triggers exclusivity in the
                           applicable Field; and

                  (D)      [...***...] upon the first sale of each Product
                           Category, as defined in Appendix C, such payment will
                           be creditable against any future earned royalties.

         9.3      ROYALTY FOR [...***...] PRODUCTS. Kraft will pay to Senomyx
                  the following

                                       6       *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

                  earned royalties during the Royalty Term:

                  (A)      With respect to Net Sales during [...***...]
                           following the date of the first commercial sale of a
                           [...***...] Product(s), Kraft will pay Senomyx a
                           royalty equal to [...***...] on that portion of total
                           annual Net Sales of [...***...] Product(s) that is
                           less than [...***...], adjusted during the Royalty
                           Term using the Consumer Price Index ("CPI"). The
                           royalty rate of [...***...] for the first year wiLL
                           apply to each Product Category, as described on
                           Appendix C;

                  (B)      With respect to Net Sales after [...***...] of the
                           first commercial sale of a [...***...] Product(s),
                           Kraft will pay Senomyx a royalty equal to [...***...]
                           on that portion of total annual Net Sales of
                           [...***...] Product(s) that is less than [...***...],
                           adjusted during the Royalty Term using the CPI; and

                  (C)      At any time, Kraft will pay Senomyx a royalty equal
                           to [...***...] on that portion of total annual Net
                           Sales of [...***...] Product(s) that is equal to or
                           greater than [...***...], adjusted during the Royalty
                           Term using the CPI.

                  (D)      The royalty rate for New Products will be negotiated
                           at a future date and shall be separate and apart from
                           the other royalty rates established for the
                           [...***...] Products.

         9.4      ROYALTY FOR [...***...] PRODUCTS. Kraft will pay to Senomyx
                  the following earned royalties during the Royalty Term:

                  (A)      With respect to Net Sales during [...***...]
                           following the date of the first commercial sale of a
                           [...***...] Product, Kraft will pay Senomyx a royalty
                           equal to [...***...] on that portion of total annual
                           Net Sales of [...***...] Product(s) that is less than
                           [...***...], adjusted during the Royalty Term using
                           the Consumer Price Index ("CPI"). The royalty rate of
                           [...***...] for the first year will apply to each
                           Product Category, as described on Appendix C;

                  (B)      With respect to Net Sales after [...***...] of the
                           first commercial sale of a [...***...] Product, Kraft
                           will pay Senomyx a royalty equal to [...***...] on
                           that portion of total annual Net Sales of [...***...]
                           Product(s) that is less than [...***...], adjusted
                           during the Royalty Term using the CPI; and

                  (C)      At any time, Kraft will pay Senomyx a royalty equal
                           to [...***...] on that portion of total annual Net
                           Sales of [...***...] Product(s) that is equal to or
                           greater than [...***...], adjusted during the Royalty
                           Term using the CPI.

                                       7       *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

         9.5      MANUFACTURING AND CAPITAL CREDITS. Kraft may in its sole
                  discretion, manufacture or enter into supply and manufacturing
                  agreements with a mutually agreed upon Third Party regarding
                  Selected Compounds; provided however, Senomyx will have the
                  first right of negotiation and refusal to manufacture any such
                  Selected Compounds, subject to provisions of cost, quality and
                  quantity. If Kraft or a Third Party manufactures a Product(s)
                  [...***...] of the capital cost specific to such manufacture,
                  incurred by Kraft, shall be creditable toward the royalties to
                  be paid for such Product(s) under Section 9.3 (b) or Section
                  9.4; provided, however, that under no circumstances shall the
                  effective royalty rate under Section 9.3 (b) be reduced below
                  [...***...] or the effective royalty rate under Section 9.4 be
                  reduced below [...***...].

         9.6      PAYMENT METHOD. The royalties due under Section 9 will be paid
                  within thirty days after the end of each calendar quarter
                  period in which such royalties are earned during the Royalty
                  Term for each Product. With each such quarterly payment, Kraft
                  will furnish to Senomyx a royalty statement in sufficient
                  detail to permit confirmation of the accuracy of the royalty
                  payment made, which sets forth on a country-by-country basis
                  the relevant sales information, including the total number of
                  units of each such Product sold, Net Sales, the royalties
                  payable in United States dollars, the method used to calculate
                  the royalty, the exchange rate used and other information
                  employed to calculate Net Sales for such Product.

         9.7      CURRENCY OF PAYMENT. All payments to be made under this
                  Agreement, including the royalties payable to Senomyx by
                  Kraft, will be paid in United States dollars by wire transfer
                  or other mutually acceptable means to a bank account
                  designated by Senomyx. With respect to each quarter, for
                  countries other than the United States, whenever conversion of
                  payments from any foreign currency are required, such
                  conversion will be made at the rate of exchange reported in
                  THE WALL STREET JOURNAL on the business day of the applicable
                  reporting period. Translation of sales recorded in local
                  currencies to United States dollars will be performed in a
                  manner consistent with Kraft's normal practices used to
                  prepare its audited financial statements for internal and
                  external reporting purposes, which uses a widely accepted
                  published exchange rate.

         9.8      TAXES WITHHELD. Any income or other tax that Kraft, or any of
                  its Affiliates is required by a government agency to withhold
                  and pay on behalf of Senomyx with respect to the royalties
                  payable under this Agreement will be deducted from and offset
                  against such royalties prior to remittance to Senomyx;
                  provided, however, that in regard to any tax so deducted,
                  Kraft will

                                       8       *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

                  give or cause to be given to Senomyx such assistance as may
                  reasonably be necessary to enable Senomyx to claim exemption
                  from or credit for the tax so deducted, and in each case will
                  promptly furnish to Senomyx proper evidence of the taxes paid
                  on Senomyx's behalf.

         9.9      LATE PAYMENT. In the event that any payment, including royalty
                  payments, due hereunder is not made when due, the payment will
                  accrue interest from that date due at the rate of one percent
                  per month; provided, however, that in no event will such rate
                  exceed the maximum legal annual interest rate. The payment of
                  such interest will not limit Senomyx from exercising any other
                  rights it may have as a consequence of the lateness of any
                  payment.

         9.10     RECORDS OF NET SALES AND ROYALTY CALCULATIONS. During the
                  Royalty Term and for a period of three years thereafter, Kraft
                  will keep complete and accurate records of sales and all other
                  information necessary to calculate Net Sales of each Product
                  in sufficient detail to allow the accrued royalties to be
                  determined accurately in accordance with United States
                  generally accepted accounting principles. Senomyx, with
                  reasonable written notice to Kraft, will have the right to
                  cause Senomyx's nationally recognized independent, certified
                  public accountant to audit such records at the place or places
                  of business where such records are customarily kept in order
                  to verify the accuracy of the reports of Net Sales and royalty
                  payments. Such accountant must execute a confidentiality
                  agreement prior to entering Kraft's premises, obligating such
                  accountant to keep all information disclosed to it
                  confidential and will only be permitted to disclose to Senomyx
                  the extent of any discrepancy between royalty payments made by
                  Kraft under this Agreement and the actual royalty required to
                  be so paid. Senomyx will bear the full cost of such audit
                  unless such audit discloses a variance of more than two
                  percent from the amount of the royalties due under this
                  Agreement, in which event, Kraft will bear the full cost of
                  such audit. In all events, Kraft will pay any underpayment
                  with interest in accordance with Section 9.9. Senomyx agrees
                  not to disclose Confidential Information concerning royalty
                  payments reports, and all other information learned in the
                  course of an audit or inspection, except to the extent
                  necessary for Senomyx to enforce its rights under this
                  Agreement or if disclosure is required by law.

10.      GRANTS. Subject to the terms and conditions of this Agreement, Senomyx
         hereby grants to Kraft the following rights:

         10.1     GRANT OF RIGHTS REGARDING [...***...] COMPOUNDS AND
                  [...***...] PRODUCTS:

                                       9       *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

                  (A)      Senomyx hereby grants to Kraft [...***...];

                  (B)      Senomyx hereby grants to Kraft [...***...]; and

                  (C)      Senomyx hereby grants to Kraft [...***...].

         10.2     GRANT OF RIGHTS REGARDING [...***...] COMPOUNDS AND
                  [...***...] PRODUCTS:

                  (A)      Senomyx hereby grants to Kraft [...***...];

                  (B)      Senomyx hereby grants to Kraft [...***...]; and

                  (C)      Senomyx hereby grants to Kraft [...***...].

         10.3     RIGHT TO NEGOTIATE LICENSE FOR NEW PRODUCTS. At any time,
                  Kraft will have the right to negotiate [...***...] license
                  under the Senomyx's Patents and Know-How to make, have made,
                  use, sell, have sold, import and export New Products. The
                  parties will negotiate language in good faith for such license
                  including the royalties on such New Products.

         10.4     LIMITATIONS TO LICENSES. Kraft may not sublicense its rights
                  under Section 10 to Third Parties, except for the purpose of
                  entering into collaborative development agreements between any
                  such Third Party and Kraft that provide the support, as is
                  appropriate at the time, for research, development or
                  commercialization of Product, and as agreed to by Senomyx in
                  writing. All rights granted by Senomyx to Kraft under Section
                  10 shall be subject to the timely payment by Kraft under
                  Section 9 of the Agreement.

                                      10       *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

         10.5     GRANT OF RIGHTS FROM KRAFT TO SENOMYX. For the sole purpose of
                  conducting research under this Agreement, Kraft hereby grants
                  to Senomyx a fully paid, non-exclusive, worldwide,
                  fully-transferable license, to use the Kraft Technology
                  pursuant to the Research Plan, with the right to grant
                  sublicenses; provided, however, that any such sublicense shall
                  be subject to the prior written approval of Kraft, which shall
                  not be unreasonably withheld.

         10.6     Notwithstanding the provisions contained within this
                  Agreement, Kraft may, at any time, negotiate a license for the
                  use of Selected [...***...] Compounds outside the Field.
                  However, the parties understand that any such license will be
                  subject to Third Party agreements entered into by Senomyx and
                  the final decision to enter into such license shall be made by
                  Senomyx, in its sole discretion.

11.      OWNERSHIP OF INTELLECTUAL PROPERTY.

         11.1     TRANSFER OF RIGHTS. Senomyx retains all rights not expressly
                  licensed or assigned in this Agreement. Except as otherwise
                  expressly provided in this Agreement, nothing in this
                  Agreement is intended to convey or transfer ownership or the
                  grant of any license or sublicense by one party to the other
                  party of any rights in any Confidential Information, Patent
                  Rights or Know-How Controlled by a party. Except as expressly
                  set forth in this Agreement, nothing in this Agreement will be
                  construed to grant manufacturing rights.

         11.2     SENOMYX INVENTIONS. Senomyx will own all Inventions and other
                  Know-How made solely by its employees and agents and all
                  Patent Rights claiming such Inventions and other Know-How.
                  Senomyx hereby irrevocably assigns to Kraft all interest in
                  and to any such Inventions and other Know-How that consist of
                  improvements to Kraft Technology, subject to the licenses
                  granted to Senomyx under Section 10. The parties will look to
                  the definition of Kraft Technology in order to determine
                  whether any such Invention and Know-How is an improvement to
                  Kraft Technology. In the event that Senomyx is legally unable
                  to assign such rights to Kraft, then Senomyx agrees either to
                  waive the enforcement of such rights against Kraft and any
                  sublicensees and assignees, or to grant Kraft an exclusive,
                  irrevocable, perpetual, worldwide, fully-paid license, with
                  right to sublicense through multiple tiers of sublicense, to
                  such rights.

         11.3     KRAFT INVENTIONS. Kraft will own all Inventions and other
                  Know-How made solely by its employees and agents, and all
                  Patent Rights claiming such Inventions and other Know-How.
                  Kraft hereby irrevocably assigns to Senomyx all interest in
                  and to any such Inventions and other Know-How that consist of
                  improvements to Senomyx Technology, Compounds, or Selected
                  Compounds, subject to the licenses granted to Kraft under
                  Section 10. The parties will look to the definition of Senomyx
                  Technology in order to determine whether any such Invention
                  and Know-How is an improvement to

                                      11       *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

                  Senomyx Technology. In the event that Kraft is legally unable
                  to assign such rights to Senomyx, then Kraft agrees either to
                  waive the enforcement of such rights against Senomyx and any
                  sublicensees and assignees, or to grant Senomyx an exclusive,
                  irrevocable, perpetual, worldwide, fully-paid license, with
                  right to sublicense through multiple tiers of sublicense, to
                  such rights.

         11.4     JOINT INVENTIONS. All Inventions conceived jointly by
                  employees or agents of Senomyx and employees or agents of
                  Kraft (the "Joint Inventions") and all Joint Patent Rights
                  will be owned jointly by Kraft and Senomyx. Kraft hereby
                  irrevocably assigns to Senomyx all interest in and to any
                  Joint Inventions that consist of improvement to Senomyx
                  Technology, Compounds, or Selected Compounds and uses thereof,
                  and all Joint Patent Rights claiming such Joint Inventions,
                  subject to the licenses granted to Kraft under Section 10.
                  Senomyx hereby irrevocably assigns to Kraft all interest in
                  and to any such Inventions and other Know-How that consist of
                  improvements to Kraft Technology, subject to the licenses
                  granted to Senomyx under Section 10. In the event that Kraft
                  is legally unable to assign such rights to Senomyx, then Kraft
                  agrees either to waive the enforcement of such rights against
                  Senomyx and any sublicensees and assignees, or to grant
                  Senomyx an exclusive, irrevocable, perpetual, worldwide,
                  fully-paid license, with right to sublicense through multiple
                  tiers of sublicense, to such rights. In the event that Senomyx
                  is legally unable to assign such rights to Kraft, then Senomyx
                  agrees either to waive the enforcement of such rights against
                  Kraft and any sublicensees and assignees, or to grant Kraft an
                  exclusive, irrevocable, perpetual, worldwide, fully-paid
                  license, with right to sublicense through multiple tiers of
                  sublicense, to such rights.

         11.5     OTHER INVENTIONS. Any Inventions not included in Sections
                  11.1, 11.2, 11.3, or 11.4 will be owned by their inventors.

         11.6     INVENTORSHIP AND ASSIGNMENT. United States patent law will
                  determine inventorship of patentable inventions. Senomyx and
                  Kraft agree to execute all documentation necessary to perfect
                  all assignments of Inventions, Know-How and Patent Rights
                  contemplated in this Agreement.

         11.7     MARKINGS. At least [...***...] prior to commercialization of
                  the first Product, Kraft will consider whether Kraft will mark
                  any Product with a Senomyx trademark or Senomyx patent.
                  However, the parties understand that Kraft will make the final
                  decision in Kraft's sole discretion.

12.      TREATMENT OF CONFIDENTIAL INFORMATION; PUBLICITY.

         12.1     CONFIDENTIALITY. Subject to the terms and conditions of this
                  Agreement, Senomyx and Kraft each agree that, during the Term
                  and for a period of [...***...] thereafter, it will keep
                  confidential, and will cause its Affiliates to keep
                  confidential, all Confidential Information that is disclosed
                  to it or to any of its

                                      12       *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

                  Affiliates by the other party. Neither Senomyx nor Kraft nor
                  any of their respective Affiliates will use the other party's
                  Confidential Information except as expressly permitted in this
                  Agreement.

         12.2     DISCLOSURE TO RELATED PARTIES. Senomyx and Kraft each agree
                  that any disclosure of the other party's Confidential
                  Information to any officer, employee, contractor, consultant,
                  sublicensee or agent of the other party or to any of its
                  Affiliates will be made only if and to the extent necessary to
                  carry out its responsibilities under this Agreement and to
                  exercise the rights granted to it hereunder, will be limited
                  to the extent consistent with such responsibilities and
                  rights, and will be provided only to such persons or entities
                  who are under an obligation of confidentiality no less
                  stringent than as set forth in this Agreement. Each party will
                  use reasonable efforts to take such action, and to cause its
                  Affiliates to take such action, to preserve the
                  confidentiality of each other's Confidential Information,
                  which will be the same efforts as it would customarily take to
                  preserve the confidentiality of its own Confidential
                  Information.

         12.3     RETURN OF CONFIDENTIAL MATERIAL UPON TERMINATION. Upon
                  termination of this Agreement, each party, upon the other
                  party's request, will return or destroy all Confidential
                  Information received from the other party pursuant to this
                  Agreement, including all copies and extracts of documents,
                  within thirty days of the request of the other party;
                  provided, however, one copy of the Confidential Information
                  may be retained for legal purposes.

         12.4     EXCEPTIONS TO CONFIDENTIAL INFORMATION. Confidential
                  Information will not include any information, which the
                  receiving party can prove by competent written evidence:

                  (A)      is now, or hereafter becomes, through no act or
                           failure to act on the part of the receiving party,
                           generally known or available;

                  (B)      is known by the receiving party at the time of
                           receiving such information, as evidenced by its
                           records;

                  (C)      is hereafter furnished to the receiving party without
                           restriction as to disclosure or use by a Third Party
                           lawfully entitled to furnish such information;

                  (D)      is independently developed by the employees, agents
                           or contractors of the receiving party without the
                           aid, application or use of the disclosing party's
                           Confidential Information; or

                  (E)      is the subject of a written permission to disclose
                           provided by the disclosing party.

                                       13
<PAGE>

                  A party may also disclose Confidential Information of the
                  other party where required to do so by law or legal process;
                  provided, however, that, in such event, the party required to
                  disclose such information must give advance written notice of
                  such disclosure to the other party and must cooperate with the
                  other party's efforts to seek, at the request and expense of
                  the other party, all confidential treatment and protection for
                  such disclosure as is permitted by applicable law.

         12.5     CONFIDENTIAL FINANCIAL INFORMATION. The parties agree that the
                  material financial terms of this Agreement will be considered
                  Confidential Information of both parties. Notwithstanding the
                  foregoing, either party may disclose such terms in legal
                  proceedings or as are required to be disclosed in its
                  financial statements, by law, or under an obligation of
                  confidentiality to bona fide potential sublicensees. Either
                  party will have the further right to disclose the material
                  financial terms of this Agreement under an obligation of
                  confidentiality to any potential acquirer, merger partner,
                  bank, venture capital firm, or other financial institution to
                  obtain financing. Notwithstanding the foregoing, the parties
                  will mutually agree upon a press release consistent, in form
                  and content, with the draft press release attached as Appendix
                  E. Thereafter, Kraft and Senomyx may each disclose to Third
                  Parties the information contained in such press release
                  without the need for further approval by the other party.

         12.6     CONFIDENTIAL RESEARCH INFORMATION. Each party agrees that all
                  results and data generated from the research under the
                  Collaborative Program will be owned exclusively by the
                  generating party and considered Confidential Information of
                  the generating party subject to the confidentiality
                  requirements of Section 12. Neither Kraft nor Senomyx will
                  provide to a Third Party any Materials provided by the other
                  party.

         12.7     PERMITTED USE AND DISCLOSURES. Each party may use or disclose
                  Confidential Information disclosed to it by the other party to
                  the extent such information is included in the Kraft
                  Technology, Senomyx Technology or Joint Patent Rights, and to
                  the extent such use or disclosure is reasonably necessary and
                  permitted in the exercise of the rights granted hereunder in
                  filing or prosecuting patent applications, prosecuting or
                  defending litigation, complying with applicable governmental
                  regulations, or court orders or otherwise submitting
                  information to tax or other governmental authorities,
                  conducting clinical trials, [...***...], or making a permitted
                  sublicense or otherwise exercising rights expressly granted to
                  the other party pursuant to the terms of this Agreement;
                  provided, however, that if a party is required to make any
                  such disclosure of the other party's Confidential Information,
                  other than pursuant to a confidentiality agreement, it will
                  give reasonable advance notice of such disclosure to the other
                  party where reasonably possible and, save to the extent
                  inappropriate in the case of patent applications, will use its
                  reasonable efforts

                                      14       *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

                  to secure confidential treatment of such Confidential
                  Information in consultation with the other party prior to such
                  disclosure (whether through protective orders or otherwise)
                  and disclose only the minimum necessary to comply with such
                  requirements.

         12.8     USE OF DATA FOR PROMOTIONAL PURPOSES. Either party may (i)
                  make public statements regarding Compounds, Selected Compounds
                  or Products, following consultation with the other party and
                  with the written consent of the other party to the form and
                  content of the public statement. Such public statement shall
                  be consistent with the press release attached as Appendix E.

         12.9     PUBLICATION OF RESULTS. Subject to this Section 12, results
                  and data obtained by either party in the course of the
                  collaboration may be submitted for publication by Senomyx in
                  accordance with Senomyx's customary practices. Senomyx will
                  send a copy of the proposed publication to Kraft and will
                  allow Kraft thirty days from the date of receipt in which to
                  determine whether such publication contains subject matter for
                  which patent protection should be sought prior to disclosure,
                  or otherwise contains Kraft Confidential Information. If no
                  answer is received from Kraft within thirty days of receipt of
                  the proposed publication, Senomyx will be free to submit such
                  proposed publication.

         12.10    PUBLICITY. Except as required by law and as provided in this
                  Section 12, neither party may make any public announcement or
                  otherwise disclose the terms of this Agreement without the
                  prior written consent of the other party, which consent will
                  not be unreasonably withheld.

13.      INTELLECTUAL PROPERTY ENFORCEMENT AND DEFENSE OF CLAIMS.

         13.1     INTELLECTUAL PROPERTY ENFORCEMENT. Subject to the Third Party
                  obligations of Senomyx, each party will have the right, but
                  not the obligation, to bring proceedings against any Third
                  Party for the inappropriate use, including patent
                  infringement, of Patent Rights solely Controlled by it, at its
                  own risk and expense. If either party brings such an action,
                  such party will be entitled to control such action, hire and
                  retain counsel, make decisions, settle on any terms, and
                  retain any and all awards or damages obtained in any such
                  proceeding. At the request and expense of either party, the
                  other party will give the requesting party all reasonable
                  assistance required to file and conduct any such proceeding.

         13.2     DEFENSE OF INFRINGEMENT CLAIMS FOR SENOMYX TECHNOLOGY. Kraft
                  will cooperate with Senomyx, at Senomyx's expense, in the
                  defense of any suit, action or proceeding against Kraft or
                  Senomyx or Senomyx's Affiliates alleging the infringement of
                  the intellectual property rights of a Third Party by reason of
                  Kraft's or Senomyx's use of any Senomyx Technology licensed to
                  Kraft under this Agreement. The parties must notify each other
                  promptly in

                                       15
<PAGE>

         13.3     writing of the commencement of any such suit, action,
                  proceeding or claim of infringement. At the expense of
                  Senomyx, Kraft will give to Senomyx full and sole authority,
                  information and assistance necessary to defend, hire counsel,
                  make decisions or settle on any terms any such suit, action or
                  proceeding and Kraft will execute all documents, provide
                  pertinent records, and take all other actions, including
                  requiring persons within its control to give testimony, which
                  may be reasonably required in connection with the defense or
                  settlement of such litigation.

         13.4     DEFENSE OF INFRINGEMENT CLAIMS FOR KRAFT TECHNOLOGY. Senomyx
                  will cooperate with Kraft, at Kraft's expense, in the defense
                  of any suit, action or proceeding against Senomyx or Kraft or
                  Kraft's affiliates alleging the infringement of the
                  intellectual property rights of a Third Party by reason of
                  Kraft's or Senomyx's use of any Kraft Technology licensed to
                  Senomyx under this Agreement. The parties must notify each
                  other promptly in writing of the commencement of any such
                  suit, action, proceeding or claim of infringement. At the
                  expense of Kraft, Senomyx will give to Kraft full and sole
                  authority, information and assistance necessary to defend,
                  hire counsel, make decisions or settle on any terms any such
                  suit, action or proceeding and Senomyx will execute all
                  documents, provide pertinent records, and take all other
                  actions, including requiring persons within its control to
                  give testimony, which may be reasonably required in connection
                  with the defense or settlement of such litigation.

14.      PATENT PROSECUTION AND MAINTENANCE. The control and expense of the
         filing, prosecution (including an opposition or interference) and
         maintenance of Patent Rights or other intellectual property rights
         claiming Inventions made solely by a party will be the sole
         responsibility of the party that made such Invention, and the party not
         filing the patent application will cooperate in such filing,
         prosecution and maintenance. Senomyx and Kraft will determine by mutual
         agreement which party will be responsible for, and will cooperate in,
         the filing, prosecution and maintenance of Joint Patent Rights and will
         share equally in the expenses incurred with respect thereto.

15.      TERM AND TERMINATION.

         15.1     TERM. The term of this Agreement will begin on the Effective
                  Date and will continue through [...***...], unless terminated
                  earlier in accordance with the provisions of Section 15.2,
                  15.3 or 15.4 hereof (the "Term").

         15.2     TERMINATION BY KRAFT. Kraft will have the right to
                  terminate this Agreement without cause at any time upon
                  [...***...] written notice, provided, however, if such
                  termination occurs prior to the end of the Collaborative
                  Period Kraft must provide [...***...].

                                      16       *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

         15.3     TERMINATION BY MUTUAL AGREEMENT. The parties may terminate
                  this Agreement at any time, in whole or in part, by mutual
                  written agreement executed by both parties.

         15.4     TERMINATION FOR BREACH. Either party has the right to
                  terminate this Agreement at any time for a material breach of
                  this Agreement by the other party, provided that the breaching
                  party has not cured such breach within [...***...] after
                  written notice thereof by the non-breaching party. The
                  non-breaching party, upon termination of this Agreement, may
                  seek actual or general damages and remedies available to it at
                  law or in equity. NEITHER PARTY WILL SEEK PUNITIVE OR
                  CONSEQUENTIAL DAMAGES.

16.      EFFECT OF TERMINATION.

         16.1     Upon termination of this Agreement pursuant to Section 15,
                  Kraft will have no right to practice within or use of the
                  Senomyx Technology, and all rights, title and interest in and
                  to the Senomyx Technology will revert to and become the sole
                  property of Senomyx, unless otherwise agreed upon in writing
                  by the parties on or before the effective date of such
                  termination.

         16.2     Expiration or termination of this Agreement will not relieve
                  the parties of any obligation accruing prior to such
                  expiration or termination.

         16.2     SURVIVAL. The obligations and rights of the parties under
                  Sections 9.10, 11.2 through 11.7, 12, 16, 17.2(B), 17.3,
                  17.4(B), 17.5, 18, and Appendix A, will survive termination or
                  expiration of this Agreement.

17.      WARRANTIES AND INDEMNIFICATION.

         17.1     MUTUAL REPRESENTATIONS AND WARRANTIES. The parties make the
                  following representations and warranties to each other:

                  (A)      CORPORATE POWER. Each party hereby represents and
                           warrants that as of the Effective Date such party (i)
                           is duly organized and validly existing under the laws
                           of the state of its incorporation and has full
                           corporate power and authority to enter into this
                           Agreement and to carry out the provisions hereof;
                           (ii) has the requisite power and authority and the
                           legal right to own and operate its property and
                           assets, to lease the property and assets it operates
                           under lease, and to carry on its business as it is
                           now being conducted; and (iii) is in compliance with
                           all requirements of applicable law, except to the
                           extent that any noncompliance would not have a
                           material adverse effect on its ability to perform its
                           obligations under this Agreement.

                                      17       *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

                  (B)      DUE AUTHORIZATION. Each party hereby represents and
                           warrants that as of the Effective Date such party (i)
                           has the requisite power and authority and the legal
                           right to enter into this Agreement and to perform its
                           obligations hereunder; and (ii) has taken all
                           necessary action on its part to authorize the
                           execution and delivery of this Agreement and to
                           authorize the performance of its obligations
                           hereunder and the grant of rights extended by it
                           hereunder.

                  (C)      BINDING AGREEMENT. Each party hereby represents and
                           warrants to the other that as of the Effective Date
                           (i) this Agreement has been duly executed and
                           delivered on its behalf and is a legal and valid
                           obligation binding upon it and is enforceable in
                           accordance with its terms; (ii) the execution,
                           delivery and performance of this Agreement by such
                           party does not conflict with any agreement,
                           instrument or understanding, oral or written, to
                           which it is a party or by which it may be bound, nor
                           violate any law or regulation of any court,
                           governmental body or administrative or other agency
                           having authority over it; and (iii) all necessary
                           consents, approvals and authorizations of all
                           governmental authorities and other persons required
                           to be obtained by it in connection with the Agreement
                           have been obtained.

         17.2     WARRANTIES REGARDING SENOMYX TECHNOLOGY. Senomyx warrants to
                  Kraft as of the Effective Date the following:

                  (A)      To the best knowledge of Senomyx as of the Effective
                           Date: (i) Senomyx has the lawful right to use the
                           Senomyx Technology for the purpose of discovering
                           Compounds to be licensed to Kraft in accordance with
                           the terms of this Agreement; and (ii) no Third Party
                           suit exists relating to the Senomyx Patent Rights.

                  (B)      EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT,
                           SENOMYX (INCLUDING ITS OFFICERS, EMPLOYEES AND
                           AGENTS) EXPRESSLY DISCLAIMS ANY REPRESENTATIONS AND
                           WARRANTIES, WHETHER EXPRESS OR IMPLIED, RELATING TO
                           SENOMYX TECHNOLOGY. SENOMYX FURTHER DISCLAIMS ANY
                           EXPRESS OR IMPLIED WARRANTY (i) OF MERCHANTABILITY OR
                           FITNESS FOR A PARTICULAR PURPOSE OF SENOMYX
                           TECHNOLOGY OR SENOMYX PATENT RIGHTS; (ii) THAT THE
                           PRACTICE OF SENOMYX TECHNOLOGY WILL NOT INFRINGE A
                           PATENT, COPYRIGHT, TRADEMARK OR OTHER RIGHT OF A
                           THIRD PARTY; AND (iii) REGARDING THE PATENTABILITY OF
                           ANY SENOMYX TECHNOLOGY, INCLUDING SENOMYX TECHNOLOGY
                           CLAIMED IN PATENT APPLICATIONS AS PART OF SENOMYX
                           PATENT RIGHTS.

                                       18
<PAGE>

         17.3     SENOMYX INDEMNIFICATION. Senomyx hereby agrees to defend and
                  indemnify Kraft, and its respective officers, directors,
                  employees, and agents (collectively, the "Kraft Indemnitees")
                  from and against all damages or other amounts payable to a
                  Third Party, including reasonable attorneys' fees and costs of
                  litigation, resulting from a claim, demand, action, suit or
                  other proceeding brought or threatened by a Third Party
                  against a Kraft Indemnitee based on Senomyx's gross negligence
                  or willful misconduct (but not patent infringement) relating
                  to Senomyx's performance or failure to perform under this
                  Agreement. IN NO EVENT WILL SENOMYX BE LIABLE FOR ANY
                  INCIDENTAL OR CONSEQUENTIAL DAMAGES SUFFERED BY KRAFT
                  RESULTING FROM THIS AGREEMENT.

         17.4     WARRANTIES RELATING TO KRAFT TECHNOLOGY. Kraft represents and
                  warrants to Senomyx as of the Effective Date the following:

                  (A)      To the best knowledge of Kraft: (i) Kraft has the
                           lawful right to license (or sublicense, as the case
                           may be) the Kraft Technology to Senomyx in accordance
                           with the terms of this Agreement; and (ii) no Third
                           Party suits against Kraft exist relating to the Kraft
                           Patent Rights.

                  (B)      EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT,
                           KRAFT (INCLUDING ITS OFFICERS, EMPLOYEES AND AGENTS)
                           EXPRESSLY DISCLAIMS ANY REPRESENTATIONS AND
                           WARRANTIES OF ANY KIND, WHETHER EXPRESS OR IMPLIED,
                           RELATING TO KRAFT TECHNOLOGY. KRAFT FURTHER DISCLAIMS
                           ANY EXPRESS OR IMPLIED WARRANTY (i) OF
                           MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE
                           OF KRAFT TECHNOLOGY, (ii) THAT THE PRACTICE OF KRAFT
                           TECHNOLOGY WILL NOT INFRINGE A PATENT, COPYRIGHT,
                           TRADEMARK, OR OTHER RIGHT OF A THIRD PARTY, AND (iii)
                           REGARDING THE PATENTABILITY OF ANY KRAFT TECHNOLOGY,
                           INCLUDING KRAFT TECHNOLOGY CLAIMED IN PATENT
                           APPLICATIONS AS PART OF KRAFT PATENT RIGHTS.

         17.5     KRAFT INDEMNIFICATION.

                  (A)      OF SENOMYX. Kraft hereby agrees to indemnify, defend
                           and hold Senomyx, and its respective officers,
                           directors, employees and agents (collectively, the
                           "Senomyx Indemnitees") harmless from and against all
                           damages, losses, liabilities, expenses and costs or
                           other amounts payable to a Third Party, including
                           reasonable attorneys' fees and costs of litigation,
                           resulting from a claim, demand, action, suit or other
                           proceeding brought or threatened by a Third Party
                           against a Senomyx Indemnitee based on (i) any
                           development, manufacture, use, handling, storage,
                           sale, or other disposition of a Selected Compound or
                           Product by or through Kraft or its Affiliates or its
                           permitted sublicensees (ii) the practice by Kraft of

                                       19
<PAGE>

                           any license granted hereunder, or (iii) infringement
                           by Kraft of Patent Rights of any Third Party; except
                           to the extent such damages or other amounts payable
                           are attributable to: (a) a violation of any
                           contractual or fiduciary duty owed by any Senomyx
                           Indemnitee to a Third Party, (b) any breach of this
                           Agreement by a Senomyx Indemnitee or a
                           misrepresentation by Senomyx in this Agreement, or
                           (c) trade secret misappropriation or patent
                           infringement by Senomyx covered by a Third Party's
                           Patent Rights. IN NO EVENT WILL KRAFT BE LIABLE FOR
                           ANY INCIDENTAL OR CONSEQUENTIAL DAMAGES SUFFERED BY
                           SENOMYX RESULTING FROM THE EXERCISE OF ANY RIGHTS
                           GRANTED IN ACCORDANCE WITH THIS AGREEMENT.

                  (B)      OF CERTAIN SENOMYX LICENSORS. Kraft hereby agrees to
                           indemnify, defend and hold [...***...] and its
                           respective officers, sponsors, directors, employees,
                           and agents (collectively, the "IP Indemnitees")
                           harmless from and against all damages or other
                           amounts payable to a Third Party, including
                           reasonable attorneys' fees and costs of litigation,
                           resulting or arising from the exercise of rights
                           under the licenses granted from Senomyx to Kraft
                           provided for under Section 10 and pursuant to any
                           agreement between [...***...] and Senomyx, including
                           product liability.

18.      MISCELLANEOUS.

         18.1     FORCE MAJEURE. Neither party will lose any rights hereunder or
                  be liable to the other party for damages or losses on account
                  of failure of performance by the defaulting party (other than
                  a payment default) if the failure is occasioned by war, fire,
                  explosion, flood, (e.g. El Nino), earthquake, strike, lockout,
                  embargo, act of God, or any other similar cause beyond the
                  control of the defaulting party; provided, however, that the
                  party claiming force majeure has exerted all reasonable
                  efforts to avoid or remedy such force majeure and thereafter
                  takes all reasonable steps to mitigate any such delay in
                  performance hereunder and any damages that may be incurred by
                  the other party thereby.

         18.2     GOVERNING LAW AND JURISDICTION. This Agreement will be
                  governed by the laws of the State of California, as such laws
                  are applied to contracts entered into and to be performed
                  entirely within such state.

         18.3     BINDING EFFECT. This Agreement will be binding upon and inure
                  to the benefit of the successors and permitted assigns of the
                  parties. Any assignment not in accordance with this Agreement
                  will be void.

         18.4     DISPUTE RESOLUTION. The parties recognize that disputes as to
                  certain matters may from time to time arise during the Term,
                  which relate to either party's rights and/or obligations
                  hereunder. It is the objective of the parties to

                                      20       *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

                  establish procedures to facilitate the resolution of disputes
                  arising under this Agreement in an expedient manner by mutual
                  cooperation and without resort to arbitration. The parties
                  agree that prior to any arbitration concerning this Agreement,
                  Senomyx's head of R&D and Kraft's head of R&D will meet in
                  person or by video-conferencing in a good faith effort to
                  resolve any disputes concerning this Agreement. Within thirty
                  days of a formal request by either party to the other party,
                  either party may, by written notice to the other party, have
                  such dispute referred to their respective officers designated
                  or their successors, for attempted resolution by good faith
                  negotiations, such good faith negotiations to begin within
                  thirty days after such notice is received. Any dispute arising
                  out of or relating to this Agreement which is not resolved
                  between the parties or the designated officers of the parties
                  pursuant to this Section 18.4 will be resolved by final and
                  binding arbitration conducted in San Diego, California (unless
                  the parties mutually agree to another location) in accordance
                  with Sections 1282 through 1288 of the California Code of
                  Civil Procedure. The arbitration will be conducted by three
                  arbitrators who are knowledgeable in the subject matter at
                  issue in the dispute. One arbitrator will be selected by
                  Senomyx, and one arbitrator will be selected by Kraft. The
                  third arbitrator will be selected by mutual agreement of the
                  two arbitrators selected by the parties. In conducting the
                  arbitration, the arbitrators will (i) determine what discovery
                  will be permitted, consistent with the goal of limiting the
                  cost and time which the parties must expend for discovery (and
                  provided that the arbitrators will permit such discovery they
                  deem necessary to permit an equitable resolution of the
                  dispute), (ii) ensure that the total time of the arbitration
                  from filing to a final decision or executed settlement
                  agreement is less than six months, and (iii) be able to decree
                  any and all relief of an equitable nature, including, but not
                  limited to, such relief as a temporary restraining order, a
                  preliminary injunction, a permanent injunction, specific
                  performance or repletion of property. The arbitrators will
                  also be able to award actual or general damages, but will not
                  award any other form of damage (e.g., consequential, punitive
                  or exemplary damages). The parties will share equally the
                  arbitrator's fees and expenses pending the resolution of the
                  arbitration, unless the arbitrators, pursuant to their its
                  right but not their obligations, requires the non-prevailing
                  party to bear all or any portion of the costs of the
                  prevailing party. The decision of the arbitrators will be
                  final and binding on the parties and may be sued on or
                  enforced by the party in whose favor it runs in any court of
                  competent jurisdiction at the option of such party.
                  Notwithstanding anything to the contrary in this Section 18.4,
                  either party may seek immediate injunctive or other interim
                  relief from any court of competent jurisdiction with respect
                  to any breach of Sections 10 or 12 hereof, or otherwise to
                  enforce and protect the Patent Rights, copyrights, trademarks,
                  or other intellectual property rights Controlled by such
                  party. In addition, arbitration will not be used to resolve
                  disputes concerning Patent Rights. Disputes concerning Patent
                  Rights, including, but not limited to, disputes concerning
                  patent ownership, claim language, claim scope and issues of
                  validity will be settled in a court of law. Any arbitration
                  ruling that relies on

                                       21
<PAGE>

                  an interpretation of Patent Rights will have no binding effect
                  in a court of law on any Patent Rights related to this
                  Agreement, unless such Patent Rights have been adjudicated in
                  a court of law. In no event will a demand for arbitration be
                  made after the date when the institution of a legal or
                  equitable proceeding based on such claim, dispute or other
                  matter in question would be barred by the applicable statute
                  of limitations.

         18.5     SEVERABILITY. If any term, covenant or condition of this
                  Agreement or the application thereof to any party or
                  circumstance is, to any extent, held to be invalid or
                  unenforceable, then the remainder of this Agreement, or the
                  application of such term, covenant or condition to parties or
                  circumstances other than those as to which it is held invalid
                  or unenforceable, will not be affected thereby and each term,
                  covenant or condition of this Agreement will be valid and
                  enforced to the fullest extent permitted by law; the parties
                  covenant and agree to renegotiate any such term, covenant or
                  condition or the application thereof in good faith in order to
                  provide a reasonably acceptable alternative to the term,
                  covenant or condition of this Agreement or the application
                  thereof that is invalid or unenforceable, it being the intent
                  of the parties that the basic purposes of this Agreement are
                  to be effectuated.

         18.6     INDEPENDENT CONTRACTORS. It is expressly agreed that Kraft and
                  Senomyx will be independent contractors and that the
                  relationship between the parties will not constitute a
                  partnership or agency of any kind. Neither Kraft nor Senomyx
                  will have the authority to make any statements,
                  representations or commitments of any kind, or to take any
                  action, which will be binding on the other party, without the
                  prior written authorization of the other party to do so.

         18.7     ENTIRE AGREEMENT; AMENDMENT. This Agreement sets forth all of
                  the covenants, promises, agreements, warranties,
                  representations, conditions and understandings between the
                  parties, and supersedes and terminates all prior agreements
                  and understandings between the parties, with respect to the
                  subject matter hereof. There are no covenants, promises,
                  agreements, warranties, representations, conditions or
                  understandings, either oral or written, between the parties
                  other than as set forth in this Agreement. No subsequent
                  alteration, amendment, change or addition to this Agreement
                  will be binding upon the parties unless reduced to writing and
                  signed by the respective authorized officers of the parties.
                  This Agreement will not be strictly construed against either
                  party. Any conflict between the terms set forth in the text of
                  this Agreement and the terms of any Appendix hereto will be
                  resolved in favor of the text of this Agreement.

         18.8     WAIVER. Except as specifically provided for in this Agreement,
                  the waiver from time to time by either of the parties of any
                  rights or the failure to exercise any remedy will not operate
                  or be construed as a continuing waiver

                                       22
<PAGE>

                  of the same right or remedy or any of the other of such
                  party's rights or remedies provided in this Agreement.

         18.9     CONSTRUCTION. The term "Article" or "Section" can refer to any
                  single paragraph level found in this Agreement or any
                  collection of multiple paragraphs thereunder.

         18.10    NO THIRD PARTY BENEFICIARIES. No Third Party, including any
                  employee of any party to this Agreement (except as
                  specifically provided in this Agreement), will have or acquire
                  any rights by reason of this Agreement. Nothing contained in
                  this Agreement will be deemed to constitute the parties
                  partners with each other or any Third Party.

         18.11    NOTICES. Any notices or communications provided for in this
                  Agreement to be made by either party to the other party must
                  be in writing, in English, and will be made by prepaid air
                  mail or overnight carrier with return receipt addressed to the
                  other party at its address set forth below. Any such notice or
                  communication may also be given by hand, or facsimile to the
                  appropriate designation. Notices will be sent:

                  If to Senomyx, to:         Senomyx, Inc.
                                             11099 North Torrey Pines Road
                                             La Jolla, CA  92037
                                             Facsimile number: (858) 404-0754
                                             Attention: Corporate Counsel with a
                                                        copy to the President

                  If to KRAFT, to:           KRAFT Foods
                                             Three Lakes Drive
                                             Northfield, IL 60096
                                             Facsimile number: 847-646-4431
                                             Attention: Patent Counsel with a
                                                        copy to VP of Research

                  By like notice, either party may specify or change an address
                  to which notices and communications must be thereafter sent.
                  Notices sent by mail, facsimile or overnight carrier will be
                  effective upon receipt and notices given by hand will be
                  effective when delivered.

         18.12    ASSIGNMENT. Notwithstanding any provision of this Agreement to
                  the contrary, neither party may assign any of its rights or
                  obligations under this Agreement in any country to any Third
                  Party without the prior written consent of the non-assigning
                  party, which consent will not be unreasonably withheld;
                  provided, however, that either party may assign its rights and
                  obligations under this Agreement without the consent of the
                  other party (i) in connection with the transfer or sale of all
                  or substantially all of its assets, or (ii) to any

                                       23
<PAGE>

                  Affiliate. In the event of such transaction, however,
                  intellectual property rights (including Know-How) of a party
                  to such transaction other than one of the parties to this
                  Agreement will not be included in the technology licensed
                  under this Agreement. Notwithstanding the foregoing, any such
                  assignment to an Affiliate will not relieve the assigning
                  party of its responsibilities for performance of its
                  obligations under this agreement. This Agreement will survive
                  any merger or consolidation of either party with or into
                  another party and no consent for any such merger,
                  consolidation or similar reorganization will be required
                  hereunder.

         18.13    COUNTERPARTS. This Agreement may be executed in two or more
                  counterparts, each of which will be deemed an original, but
                  all of which together will constitute one and the same
                  instrument.

IN WITNESS WHEREOF, the parties, through their authorized officers, have
executed this Agreement as of the Effective Date.

KRAFT FOODS, INC.

By:         [...***...]
            -------------------------------------

Title:       Senior V.P. R&D Quality
            -------------------------------------

Date:        December 6, 2000
            -------------------------------------

SENOMYX, INC.

By:          /s/ Paul A. Grayson
            -------------------------------------

Title:       President & CEO
            -------------------------------------

Date:        December 6, 2000
            -------------------------------------

                                      24       *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

                        COLLABORATIVE RESEARCH AGREEMENT

                            APPENDIX A - DEFINITIONS

"Affiliate" means any corporation, company, partnership, joint venture,
association or other entity, which directly or indirectly controls, is
controlled by or is under common control with a party. As used in this
definition, the term "control" means direct or indirect beneficial ownership of
more than fifty percent (or such lesser percentage which is the maximum allowed
to be owned by a foreign corporation in a particular jurisdiction) of the
outstanding securities having voting rights for the election of directors in a
corporation or of the comparable equity interest in any other type of entity.

"Agreement" means this agreement, together with all appendices attached hereto,
as it may be amended or supplemented from time to time hereafter by a written
agreement executed by authorized representatives of both parties.

"[...***...] Compound(s)" means [...***...], discovered in the course of the
Collaborative Program that [...***...] that may be optimized and further tested
[...***...] by Senomyx and for which Senomyx will prepare a written report of
data to be reviewed by Kraft.

"[...***...] Phase" means that part of the Collaborative Program wherein Senomyx
will pursue the identification of [...***...] Compounds.

"[...***...] Product(s)" means product(s) in Field II that incorporate Selected
[...***...] Compound(s).

"[...***...] Tastant(s)" means [...***...] and that are provided by Kraft to
Senomyx under this Agreement.

"Collaborative Period" means the period beginning on the Effective Date and
ending three years thereafter, unless terminated earlier in accordance with
Section 3 or 15. The Collaborative Period will terminate after three years
regardless of whether the Compound Research has been completed.

"Collaborative Program" means a research program during the Collaborative Period
to discover [...***...] in Fields to be conducted pursuant to the Research Plan.

"Compound(s)" means [...***...] Compound(s) and/or [...***...] Compound(s).

"Confidential Information" means all information, Inventions and Know-How
disclosed by one party to the other party pursuant to this Agreement, including,
without limitation, information and material (whether or not patentable)
regarding technology, products,

                                      25       *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

research, development, manufacturing, marketing, finances, personnel or other
business information or objectives which is designated as confidential in
writing by the disclosing party, whether by letter or by the use of an
appropriate stamp or legend, prior to or at the time any such material, trade
secret or other information is disclosed by the disclosing party to the other
party. Notwithstanding the foregoing to the contrary, Inventions, Know-How or
other information which is orally, electronically or visually disclosed by a
party, or is disclosed in writing without an appropriate letter, stamp or
legend, will constitute Confidential Information of a party if the disclosing
party, within thirty days after such disclosure, delivers to the other party a
written document or documents describing the Inventions, Know-How or other
information and referencing the place and date of such oral, visual, electronic
or written disclosure and the names of the persons to whom such disclosure was
made.

"Control" or "Controlled" means, with respect to intellectual property,
possession by a party, as of the Effective Date or during the Collaborative
Period, of the ability to grant a license or sublicense in accordance with the
terms of this Agreement, without violating the terms of any agreement by such
party with any Third Party that is in effect on the Effective Date.

"Effective Date" means the date that this Agreement is signed by the last party
to sign below.

"Field I" means [...***...].

"Field II" means [...***...].

"Fields" means collectively Field I and Field II.

"Invention" means any invention, including any new and useful process, method,
or composition of matter, or improvement thereto, whether or not patentable,
made in the course of the Collaborative Program.

"Joint Invention" has the meaning set forth in Section 11.4.

"Joint Patent Rights" means all Patent Rights containing one or more claims to a
Joint Invention.

"Know-How" means information and data, whether or not patentable, which is not
generally known to the public, including, without limitation, designs, concepts,
formulae, software, techniques, practices, processes, methods, knowledge, skill,
experience, expertise, technical information, Materials and data, including
pharmacological, toxicological and clinical test data, analytical and quality
control data, patent and legal data or marketing, sales and manufacturing data.

                                      26       *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

"Kraft Know-How" means, to the extent necessary for purposes of the activities
to be conducted under this Agreement, all Know-How Controlled by Kraft,
including, but not limited to, formulations in which Selected Compounds are
used, [...***...] and methods of incorporating and/or processing Selected
Compounds into Products.

"Kraft Patent Rights" means, to the extent necessary for purposes of the
activities to be conducted under this Agreement, all Patent Rights Controlled by
Kraft, including, without limitation, any Patent Rights containing one or more
claims to an Invention made solely by employees or agents of Kraft, but
excluding any Joint Patent Rights.

"Kraft Technology" means Kraft Patent Rights and Kraft Know-How.

"Materials" means [...***...], including without limitation, Compounds and
Selected Compounds.

"Net Sales" means, with respect to a Product, the gross amount invoiced by Kraft
and its Affiliates and/or permitted sublicensees on any sales or other transfer
of the Product, less the following items:

         i)       trade, quantity and cash discounts or rebates actually allowed
                  with respect to such sales;

         ii)      credits, rebates, charge-back rebates, reimbursements or
                  similar payments actually granted or given to wholesalers and
                  other distributors, buying groups, governmental agencies and
                  other institutions, but only to the extent actually allowed;

         iii)     credits or allowances actually granted for rejection or return
                  of Products previously sold; and

         iv)      any tax, tariff, duty or other governmental charge (other than
                  an income tax) levied on the sale, transportation or delivery
                  of a Product that is borne by the seller thereof and deducted
                  from sales under United States generally accepted accounting
                  principles.

Net Sales will be determined from the books and records of Kraft, its Affiliates
and/or its permitted sublicensees, maintained in accordance with United States
generally accepted accounting principles.

"New Product(s)" means any products outside those listed on Appendix C that
incorporate Selected [...***...] Compounds in Field I.

"Patent Rights" means all rights associated with all U.S. or foreign (including
regional authorities such as the European Patent Office) regular or provisional
patents or patent

                                      27       *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

applications, including any continuation, continuation-in-part, or division
thereof or any substitute application therefor or equivalent thereof, and any
patent issuing thereon, including any reissue, reexamination or extension
thereof and any confirmation patent or registration patent or patent of
additions based on any such patent.

"Product(s)" means [...***...] Product(s) and/or [...***...] Product(s).

"Product Category(ies)" means each category of [...***...] Products listed on
Appendix C.

"Product Development and Commercialization" means the program for development of
a Product conducted during the term of this Agreement as provided under Section
3.5.

"Receptor" or "Receptors" means [...***...].

"Research Plan" means the plan outlining the research to be performed during the
Collaborative Program agreed to by the Steering Committee at the first meeting
thereof within thirty days of the Effective Date.

"Royalty Term" means, in the case of any Product and as to any country, the
period of time commencing on [...***...] and ending upon the date that is
[...***...] in such country.

"Selected [...***...] Compound(s)" means those [...***...] Compound(s) selected
by Kraft for development, which are subject to certain payment and diligence
provisions.

"Selected Compound(s)" means Selected [...***...] Compound(s) and/or Selected
[...***...] Compound(s).

"Selected [...***...] Compound(s)" means those [...***...] Compound(s) selected
by Kraft for development, which are subject to certain payment and diligence
provisions.

"Senomyx Know-How" means all Know-How related to the Collaborative Program,
which is not covered by the Senomyx Patent Rights, but is necessary or
appropriate for purposes of the activities to be conducted under this
Agreement, and which is Controlled by Senomyx as of the Effective Date or
developed by Senomyx in the course of the Collaborative Program.

"Senomyx Patent Rights" mean all Patent Rights that are necessary or
appropriate for purposes of the activities to be conducted under this
Agreement, and which are Controlled by Senomyx as of the Effective Date or
developed by Senomyx in the course of the Collaborative Program, but
excluding any Joint Patent Rights.

"Senomyx Technology " means the Senomyx Patent Rights, and Senomyx Know-How.

                                      28       *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

"[...***...] Compounds" means [...***...], discovered in the course of the
Collaborative Program that [...***...] and for which Senomyx will prepare a
written report of data to be reviewed by Kraft.

"[...***...] Phase" means that part of the Collaborative Program wherein Senomyx
will pursue the identification of [...***...] Compounds.

"[...***...] Product(s)" means any product(s) listed on Appendix C that
incorporate Selected [...***...] Compound(s).

"[...***...] Tastants" means [...***...] provided by Kraft to Senomyx under this
Agreement.

"Steering Committee" has the meaning set forth in Section 2.

"Term" has the meaning set forth in Section 15.1.

"Third Party(ies)" means any party other than a party to this Agreement or an
Affiliate of Senomyx or Kraft.

                                      29       *CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

                        COLLABORATIVE RESEARCH AGREEMENT

                         APPENDIX C - PRODUCT CATEGORIES

-        [...***...]

                                      30       *CONFIDENTIAL TREATMENT REQUESTED

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