Document:

HELIX BIOMEDIX, INC./ THERAPEUTIC PEPTIDES, INC.
                               LICENSING AGREEMENT

     THIS LICENSING AGREEMENT (this "Agreement"), made and entered into this ___
day of  _________,  2001,  by and  between  Helix  BioMedix,  Inc.,  a  Delaware
corporation  having its principal office at 210 Baronne Street,  Suite 1004, New
Orleans,  Louisiana  70112 ("Helix" or "Licensor"),  and  Therapeutic  Peptides,
Inc.,  a  Louisiana  corporation  having  its  principal  office at 5700  Citrus
Boulevard, Suite B, Harahan, Louisiana 70123 ("TPI" or "Licensee").

     WHEREAS, TPI is the inventor of certain proprietary peptides defined in the
HELIX/TPI  RESEARCH  ALLIANCE  AGREEMENT  by and between  Helix  BioMedix,  Inc.
(Louisiana),   Helix  BioMedix,   Inc.   (Colorado),   TPI,   BioSouth  Research
Laboratories,  Inc.,  and Dr.  Donald R. Owen,  dated  September  30, 1999,  and
pursuant to said agreement TPI has assigned all its rights,  title and interest,
in and to said proprietary peptides to Helix; and

     WHEREAS, Helix, pursuant to said HELIX/TPI RESEARCH ALLIANCE AGREEMENT, has
agreed to file one or more patent  applications  with  respect to those  certain
proprietary peptides to be assigned to it by TPI; and

     WHEREAS, certain of the aforementioned proprietary peptides may have useful
application in topical,  non-pharmaceutical skin care intermediate  concentrates
and end-use products; and

     WHEREAS,  TPI,  pursuant to said  HELIX/TPI  RESEARCH  ALLIANCE  AGREEMENT,
desires to acquire from Helix a license of certain of Helix's rights,  including
a limited right to sublicense  TPI's  Affiliates,  to make, have made, use, have
used,  offer for sale, have sold, sell,  and/or otherwise  dispose of certain of
the aforementioned  proprietary peptides for the purpose of making, having made,
using,  having used,  offering for sale,  having sold,  selling and/or otherwise
disposing of topical, non-pharmaceutical skin care intermediate concentrates and
end-use products using,  made from, or derived from said  proprietary  peptides;
and

     WHEREAS,  Helix  desires  to grant to TPI such a  license  under  terms and
conditions as are set forth herein below.

     NOW,  THEREFORE,  in consideration of the mutual covenants and undertakings
set out  herein and other  good and  valuable  consideration,  the  receipt  and
sufficiency  of  which is  hereby  acknowledged,  the  parties  hereto  agree as
follows:

1.   DEFINITIONS

1.1  "Licensed  Peptides"
     --------------------
     shall  mean the three (3)  short  chain  linear  peptides,  the amino  acid
     sequences of which are set forth in Exhibit A.

<PAGE>

1.2  "Licensed Products"
     -------------------
     shall  mean  any  topical,   non-pharmaceutical   skin  care   intermediate
     concentrates  and end-use products that contain one or more of the Licensed
     Peptides.

1.3  "Licensed Territory"
     --------------------
     shall mean the United States,  its  territories  and  possessions,  and all
     other  countries  in which  Helix has or may have patent  applications  and
     patents which cover or relate to the Licensed Peptides.

1.4  "Effective  Date"
     -----------------
     shall mean the date of this Agreement as first written herein above.

1.5  "TPI's Affiliates"
     ------------------
     shall mean and include BioSouth Research  Laboratories,  Inc., Biosyn, Inc.
     and Vital Assist,  Inc., as well as any other entity which owns over 10% of
     TPI's voting stock or otherwise  controls  TPI's business and affairs or in
     which  10% of the  voting  stock of the  entity is owned by TPI or which is
     otherwise controlled by TPI.

1.6  "Gross Sales"
     -------------
     shall have the meaning set forth in Section 3.2.

1.7  "Licensed Field of Use"
     -----------------------
     shall mean the use of  Licensed  Peptides  and  Licensed  Products  in both
     intermediate    concentrates    and   end-use    products    for   topical,
     non-pharmaceutical skin care.

1.8  "Licensed Trade Secrets"
     ------------------------
     shall  mean the  sequences  of amino  acids  set  forth in  Exhibit  A that
     constitute the Licensed Peptides.

1.9  "Licensed Patent Rights"
     ------------------------
     shall  mean all  current  and  future  patent  applications  (which for the
     purpose  of this  Agreement  shall be deemed  to  include  certificates  of
     invention and  applications  for  certificates of invention) and patents in
     the Licensed  Territory  covering or related to the Licensed  Trade Secrets
     and  the  Licensed  Peptides,  including  any  substitutions,   extensions,
     reissues,   reexaminations,    renewals,   divisions,   continuations,   or
     continuations-in-part  thereof,  which  Helix owns and  controls  and under
     which Helix has the right to grant  licenses,  as of the Effective  Date of
     this Agreement and thereafter  including,  but not limited to, those patent
     applications and patents set forth in Exhibit B.

2. GRANT OF LICENSE Helix  hereby  grants to Licensee a personal,  non-exclusive
     license under Helix's  Licensed  Trade Secrets and Licensed  Patent Rights,
     including the right to sublicense  TPI's  Affiliates,  to make,  have made,
     use, have used,  offer for sale,  sell, have sold, or otherwise  dispose of
     the Licensed Peptides for the purpose of making, having made, using, having
     used,  offering for sale,  selling,  having sold, or otherwise disposing of
     Licensed Products for the Licensed Field of Use in the Licensed Territory.

<PAGE>

3.   ROYALTIES

     3.1 Beginning on the Effective  Date and to the extent that Licensee  sells
or otherwise  disposes of Licensed  Products,  Licensee  will, in the manner and
within the time set forth in Section 4 hereof,  pay a continuing  and cumulative
royalty in U.S.  Dollars to Helix with  respect  to  Licensed  Products  sold or
otherwise  disposed of by Licensee in the Licensed Territory after the Effective
Date and before  termination of this  Agreement,  and thereafter as set forth in
Section 6.5. The royalty  payable  with  respect to  Licensee's  Gross Sales (as
defined below) of Licensed Products will be:

     2% of the first $25 million (i.e., for $1.00 to $25,000,000)
     3% of the next $50 million (i.e., for $25,000,001 to $50,000,000)
     4% for sales above $50 million (i.e., for $50,000,001 and up).

     Licensee guarantees,  and will pay at the end of each designated period set
forth below, the following minimum royalties during the term of this Agreement:

     first thirty (30) months:                                         $0
     next twelve (12) months (i.e., months 31 to 42)                   $10,000
     next twelve (12) months (i.e., months 43 to 54)                   $10,000
     next twelve (12) months (i.e., months 55 to 66)                   $25,000
     each additional twelve (12) months (due at the end of each year)  $50,000.

     3.2 "Gross  Sales"
         --------------
     shall mean  Licensee's  gross sales (e.g.,  the gross invoice amount billed
customers) of Licensed Products,  less excise taxes,  discounts,  and allowances
actually  shown on an invoice and,  further,  less any bona fide returns (net of
all returns actually made or allowed as supported by credit  memoranda  actually
issued to customers)  up to the amount of the actual sales of Licensed  Products
during  the  royalty  period.  No other  costs  incurred  in the  manufacturing,
selling, advertising, and distribution of Licensed Products will be deducted.

     3.3  Should  Licensee  sublicense  to  any  of  its  Affiliates  under  the
provisions  of Section 2 hereof,  Licensee  shall pay to Helix the same  royalty
amounts that Helix would be entitled to receive if Licensee were itself  selling
or otherwise disposing of Licensed Products.

     3.4 The above royalties shall accrue upon each Licensed  Product being sold
or  otherwise  disposed  of in the  Licensed  Territory  by  Licensee  after the
Effective  Date.  Licensed  Products  will be  considered  "sold" or  "otherwise
disposed of" when payment for said Licensed Products is received by Licensee.

     3.5 All taxes  resulting by operation of this  Agreement  shall be borne by
the party obligated to pay them under applicable law. Licensee may withhold from
payments to Helix under this  Agreement the amount of any national  taxes levied
on Licensee's payments hereunder by any government or duly constituted authority
in a country of the Licensed  Territory.  In such event,  Licensee  shall effect
payment to the  appropriate  tax  authorities of said government of the national
taxes so withheld,  and shall transmit to Helix official receipts issued by said
tax  authorities or such other evidence as is reasonably  available to support a
claim for income tax  credit by Helix in  respect of any taxes so  withheld  and
paid.

<PAGE>

4.   PAYMENT, REPORTS AND RECORDS

     4.1 Licensee  will provide  quarterly  written  royalty  reports  ("Royalty
Reports") to Helix, accompanied by payment for royalties due, within thirty (30)
days after the last day of March, June,  September and December of each calendar
year during the term of this  Agreement,  and thereafter as set forth in Section
6.5.  Royalty  Reports  will  be  certified  as  accurate  by a duly  authorized
representative of Licensee and will separately state for the preceding quarterly
period the  following  information:  the type,  quantity  and price of  Licensed
Products  sold or otherwise  disposed of by Licensee in the Licensed  Territory,
the minimum guaranteed royalty payable,  if any, the total royalty payable under
this Agreement,  and the applicable  withholding tax by country, if any. Royalty
Reports shall be furnished to Helix regardless of whether Licensed Products were
sold or  otherwise  disposed of during the period or whether any actual  royalty
was owed.  The  receipt or  acceptance  by Helix of  Royalty  Reports or royalty
payments shall not prevent Helix from  subsequently  challenging the validity or
accuracy of Royalty Reports or the accompanying royalty payments.

     4.2 The first Royalty Report and royalty payment shall be made with respect
to all  Licensed  Products  sold or  otherwise  disposed  of by  Licensee in the
Licensed  Territory  from the  Effective  Date to the last day of the first full
quarterly period next ending.

     4.3 "Final" Royalty Reports and royalty payments will be made within thirty
(30) days after the  expiration or  termination  of this  Agreement,  as well as
within the applicable  ninety-day  period specified in Section 6.5, with respect
to all  Licensed  Products  sold or  otherwise  disposed  of by  Licensee in the
Licensed Territory.

     4.4 If Licensee fails to make any royalty  payment within the required time
for such  payment,  Licensee  will pay interest to Helix at the simple  interest
rate of three percent (3%) per month,  computed from the due date (which will be
deemed to be the end of the  applicable  thirty  (30) days period  specified  in
Section 4.1) until such payment and the interest thereon are paid in full.

     4.5 Licensee will make and retain,  and will cause TPI's Affiliates to make
and retain,  for two (2) years  following the  submission of Royalty  Reports to
Helix  hereunder,  true  and  accurate  records,  files  and  books  of  account
containing  all  data   reasonably   required  for  the  full   computation  and
verification  of the  amounts to be paid under this  Agreement  and set forth in
Royalty Reports. This obligation will survive any termination of this Agreement.

     4.6 Upon  reasonable  notice by Helix,  and at any  reasonable  time during
normal business hours,  but no more frequently than once during each consecutive
twelve-month period beginning with the Effective Date of the Agreement, Licensee
will  permit,  and  will  cause  TPI's  Affiliates  to  permit,  the  reasonable
inspection of such records,  files and books of account by any independent  firm
of  certified  public  accountants  mutually  accepted  by  both  parties.  Such
examinations  will be solely for the purpose of verifying  the  information  set
forth in Royalty Reports.  Licensee will give such  independent  accounting firm

<PAGE>

access to the records  described above,  only provided that such firm will agree
not to  disclose  to Helix or any other  party any  information  other  than the
information required to be reported in the Royalty Reports under Section 4.1. In
the event that such inspection reveals an underpayment by Licensee of the actual
amounts owed Helix,  Licensee will pay the  difference  within thirty (30) days,
and  Licensee  will pay interest to Helix at the simple  interest  rate of three
percent  (3%) per month  computed  from the due date until such  payment and the
interest  thereon  are  paid in  full.  In  addition,  in the  event  that  such
inspection reveals an underpayment by Licensee of the actual amounts owed Helix,
the cost of such inspection will be borne as follows: (i) if the underpayment is
ten  percent  (10%) or less,  Helix  will  pay for the  inspection;  (ii) if the
underpayment  is ten percent  (10%) through  fifteen  percent  (15%),  Helix and
Licensee  will  share  the  cost  of  the  inspection  equally;   (iii)  if  the
underpayment  is fifteen  percent  (15%) or greater,  Licensee  will pay for the
inspection.

5.   OTHER COVENANTS

     5.1  Licensee  will  indemnify,  defend  and hold Helix  harmless  from and
against any and all liabilities,  damages, losses, costs and expenses (including
reasonable  attorney's fees and expenses)  actually  incurred by Helix resulting
from or associated  with any product  liability  lawsuit  brought  against Helix
relating to the Licensed Products. In addition,  Licensee shall maintain product
liability  insurance covering the sale of Licensed Products in an amount no less
than  $1,000,000 for sales of Licensed  Products up to and including  $5,000,000
and an  additional  $1,000,000  in coverage for each  additional  $5,000,000  of
Licensed  Product sales.  Licensee shall name Helix as an additional  insured on
all such insurance policies.

     5.2 Licensee  shall not  arbitrarily or  unilaterally  replace any Licensed
Peptides in the  formulation  of a Licensed  Product with  peptides not licensed
from Helix once the Licensed Product is sold or otherwise qualified and accepted
for marketing, whichever occurs first.

     5.3  Licensee  hereby  grants  to Helix an  option  to  license  the use of
Licensee-owned  delivery  systems  that  TPI or  TPI's  Affiliates  use with the
Licensed Peptides,  for use by Helix in non-cosmetic  applications,  under terms
and  conditions  that  are  substantially  similar  to those  contained  in this
Agreement.  Licensee represents and warrants that it has the requisite authority
to grant this option.  Licensee  shall grant or cause TPI's  Affiliates to grant
such a license within a reasonable period of time after receiving a request from
Helix to exercise its option hereunder.

     5.4 During the term of this Agreement,  Licensee agrees to share all of its
test data regarding the relative  efficacy and toxicity of the Licensed Peptides
and data from  Licensee's  "in vivo" tests of Licensed  Peptides,  all said data
being that developed by TPI during its selection of the Licensed Peptides.

     5.5 During the term of this Agreement,  Helix will timely notify TPI in the
event Helix files any patent application, abandons the prosecution of any patent
application,  secures  any patent,  makes a  determination  not to maintain  any
patent in force or not to seek reissue or  reexamination  of any patent covering
or related to the Licensed Peptides and the Licensed Trade Secrets.

<PAGE>

6.   TERM AND TERMINATION

     6.1 The term of this  Agreement  shall be from the Effective Date and shall
continue  until the last to expire of an issued patent  relating to the Licensed
Peptides, unless terminated earlier as otherwise provided in this Agreement.

     6.2 Either party shall have the right to terminate this Agreement by giving
written  notice  of  termination  to the other  party in the case of a  material
breach of this Agreement by the other party.  Such written notice of termination
shall  specify the nature of the  default.  The  breaching  party shall have the
right to cure any such  default  within  sixty  (60) days  after  receipt of the
non-breaching  party's  notice,  but if the  default  is not cured  within  such
period,  the non-breaching  party may terminate this Agreement by written notice
to the breaching party at the end of such period.

     6.3 If Licensee  should  dissolve,  or should file a voluntary  petition in
bankruptcy  for any purpose  other than  reorganization,  or an order  should be
entered pursuant to any law relating to bankruptcy or insolvency or appointing a
receiver or trustee for Licensee for any purpose other than reorganization, then
Helix may, within ten (10) days thereafter, give written notice of its desire to
terminate this Agreement.  Thereupon, this Agreement shall terminate on the date
specified  in such  notice,  which shall not be less than thirty (30) days after
the date of such notice.

     6.4 In the event  that any  proceeding  shall be  instituted  by or against
Helix seeking to adjudicate  it bankrupt or insolvent,  or seeking  liquidation,
winding up, reorganization,  arrangement, adjustment, protection, relief from or
to  consolidate  its debts under any law relating to bankruptcy or insolvency or
appointing  a  receiver,  trustee  or  other  similar  official  for  it or  any
substantial part of its property or it shall take any action to authorize any of
the foregoing  actions,  Licensee shall have the right to retain and enforce any
and all of the rights granted it hereunder.

     6.5 In the event that this  Agreement  is  terminated  pursuant to Sections
6.1,  6.2 or 6.3 above,  the  license  granted  in Section 2 will  automatically
terminate, except as otherwise provided in Section 6.6 below.

     6.6 Upon  termination of this Agreement  (except for uncured failure to pay
royalties),  Licensee  shall have the right for ninety (90) days to complete any
then  existing and  outstanding  contracts  with  customers  related to Licensed
Products pursuant to the license granted  hereunder.  Licensee may also for such
ninety-day period dispose of any previously  manufactured Licensed Products held
in its inventory as of the date of such  termination.  The rights  granted under
this  Section  6.6 will be subject to the  provisions  of  Sections 3 and 4. The
rights granted and obligations  imposed under this Section 6.6 shall survive the
termination of this Agreement.

7.   DISCLAIMERS

     7.1 Helix does not assume any responsibility whatsoever for the performance
or  manner  of use of  Licensed  Products  manufactured,  made,  used,  sold  or
otherwise  disposed  of by  Licensee  or TPI's  Affiliates.  Helix shall have no
liability therefor, nor will it have any obligation to defend, indemnify or hold
harmless any party from any suits, actions or claims arising out of, or relating
to, such performance or manner of use.

<PAGE>

     7.2 Nothing contained in this Agreement will be construed as:

          7.2.1 an  admission by either  party of any past  infringement  of any
     patent or as an admission  of, or a warranty or  representation  as to, the
     validity and/or scope of any patent, and either party is free to contest in
     any proceeding the validity and/or scope thereof;

          7.2.2 conferring any license or other right, by implication,  estoppel
     or otherwise, under any patent application,  patent or patent right, except
     as herein expressly granted;

          7.2.3  conferring  any  license  or right  with  respect  to any trade
     secrets,  copyrights,  mask works or  know-how  of either  party  except as
     required by Section 2 of this Agreement; or

          7.2.4  conferring  any license or right with respect to any trademark,
     trade name or corporate name of Helix or any  contraction,  abbreviation or
     simulation thereof.

8.   GENERAL TERMS AND CONDITIONS

     8.1 Entire Agreement; Modification and Waiver.
         ------------------------------------------
     This Agreement  represents the entire  understanding  and agreement between
the parties with respect to the subject matter hereof, and supersedes all of the
negotiations,  understandings  and  representations  made  by and  between  such
parties.  None of the terms or provisions  hereof may be amended,  supplemented,
waived or  changed  orally,  unless by a writing  signed by each of the  parties
hereto.

     8.2 Assignment.
         -----------
     This Agreement, including the benefits or rights hereunder, may be assigned
by Helix  without  Licensee's  prior  written  consent and by  Licensee  without
Helix's  prior  written  consent,   except  that  any  attempted  sale,  merger,
assignment,  pledge,  hypothecation  or other  transfer  of  Licensee's  rights,
benefits  or  interests  in and under  this  Agreement  to  Demegen,  Inc.,  its
administrators,  successors or assigns, shall be void and of no effect and shall
convey  no rights or  interests  in this  Agreement  or the  Licensed  Peptides,
Licensed Trade Secrets or Licensed  Patent Rights unless Helix's express written
consent to such sale, merger, assignment,  pledge, hypothecation or transfer has
first been obtained.  Except as provided  herein with respect to Demegen,  Inc.,
this  Agreement  will be binding on and will inure to the benefit of the parties
hereto and their permitted administrators, successors and assigns.

     8.3 Applicable Law.
         ---------------
     The Agreement will be governed by and  interpreted  in accordance  with the
laws of the State of Louisiana, without regard to conflicts of laws principles.

     8.4 Jurisdiction; Service of Process.
         ---------------------------------
     Any action or  proceeding  seeking to enforce any provision of, or based on
any right arising out of, this  Agreement may be brought  against  either of the
parties  in the  courts  of the  State of  Louisiana,  and  each of the  parties
consents to the  jurisdiction of such courts (and of the  appropriate  appellate
courts) in any such action or proceeding  and waives any objection to venue laid
therein.  Process  in any  action or  proceeding  referred  to in the  preceding
sentence may be served on any party anywhere in the world.

<PAGE>

     8.5 Court Costs; Limitation of Liability.
         -------------------------------------
     Both  parties  agree that if either party is held by any court of competent
jurisdiction to be in violation,  breach,  or nonperformance of any of the terms
of this  Agreement,  then it will promptly pay to the other party all reasonable
and  allocable  costs of such action or suit,  including  reasonable  attorneys'
fees.  However,  in no event will  either  party be liable to the other party by
reason of breach or  termination  of this  Agreement for any loss of prospective
profits or incidental or consequential damages.

     8.6 Relationship of the Parties.
         ----------------------------
     Nothing in this  Agreement  will be  construed  as making  either party the
partner, joint venturer, agent, or employer/employee of the other. Neither party
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,  except
as provided for herein or authorized in writing by the party to be bound.

     8.7 Payments.
         ---------
     All  sums of money  referred  to in this  Agreement  as  being  payable  by
Licensee to Helix will be sums  payable in U.S.  Dollars and may be made by wire
transfer    to     ______________________     Account    No.    __________    at
___________________________________________________________________________.

     8.8 Patent Marking; Use of Helix's Name.
         ------------------------------------
     Licensee may use Helix's name,  trademarks,  service  marks,  logos,  trade
names  and/or  branding on the  packaging  of Licensed  Products,  but only with
Helix's  prior  written  consent.  All such  legends will conform to the marking
requirements of the applicable countries.

         8.9 Notices.
         ------------
     All notices,  requests,  demands,  Royalty Reports and other communications
required under or related to this  Agreement will be in writing,  in the English
language, and sent to the addresses set forth below:

         If to Helix:

              Helix BioMedix, Inc.
              Attn: R. Stephen Beatty, President
              210 Baronne Street, Suite 1004
              New Orleans, Louisiana 70112

         If to Licensee:

              Therapeutic Peptides, Inc.
              Attn: Dr. Donald R. Owen, President
              5700 Citrus Boulevard, Suite B
              Harahan, Louisiana 70123

<PAGE>

     8.10 Severability.
         --------------
     The invalidity, illegality or unenforceability of any provision will not in
any way affect, impair, invalidate or render unenforceable this Agreement or any
other provision thereof.  If any provision of this Agreement is determined to be
unenforceable by reason of its extent,  duration,  scope or otherwise,  then the
parties  contemplate that the court making such  determination  will reduce such
extent,  duration,  scope or other provision,  and enforce them in their reduced
form for all purposes contemplated by this Agreement.

     8.11 Section Headings; Construction.
         --------------------------------
     The headings of sections in this  Agreement  are  provided for  convenience
only and will not affect its construction or  interpretation.  All references to
"Section" or "Sections" refer to the  corresponding  section or sections of this
Agreement unless otherwise specified.  Unless otherwise expressly provided,  the
word "including" does not limit the preceding words or terms.

     8.12 Execution of Agreement.
         ------------------------
     This Agreement may be executed in one or more  counterparts,  each of which
will be deemed to be an original copy of this Agreement,  and all of which, when
taken  together,  will be deemed to constitute one and the same  agreement.  The
exchange  of  copies  of this  Agreement  and of  signature  pages by  facsimile
transmission will constitute  effective execution and delivery of this Agreement
as to the  parties  and may be used in lieu of the  original  agreement  for all
purposes.  Signatures of the parties  transmitted by facsimile will be deemed to
be their original signatures for any purpose whatsoever.

     IN WITNESS  WHEREOF,  the parties  have caused  this  Agreement  to be duly
executed as of the date first written above.

     Helix:                                       Licensee:

     HELIX BIOMEDIX, INC.                         THERAPEUTIC PEPTIDES, INC.

     By: /s/ R. Stephen Beatty                    By: /s/ Dr. Donald R. Owen
        -----------------------                      ---------------------------
        R. Stephen Beatty                            Dr. Donald R. Owen
        President                                    President

<PAGE>

                                    EXHIBIT A

                                Licensed Peptides

     The peptides  licensed  under this  Agreement are the three (3) short chain
linear peptides identified by the amino acid sequences specified below:

--------------------------------------------------------------------------------
TPI I.D. Number                           Amino Acid Sequence
--------------------------------------------------------------------------------
P 48                                      VAKLLAKLAKKLL
--------------------------------------------------------------------------------
P 118                                     FAKLLAKALKKFL
--------------------------------------------------------------------------------
P 165                                     FALALKALKKL
--------------------------------------------------------------------------------

<PAGE>

                                   EXHIBIT BLICENSE AGREEMENT

BETWEEN:

          THE UNIVERSITY OF BRITISH COLUMBIA, a corporation  continued under the
          University  Act of British  Columbia  and  having  its  administrative
          offices  at 2075  Wesbrook  Mall,  in the  City of  Vancouver,  in the
          Province of British Columbia, V6T 1W5

                                                              (the "University")

AND:

          HELIX BIOMEDIX, INC., a corporation incorporated under the laws of the
          State of  Delaware,  and having an office at 22122 20th Ave. SE, Suite
          148, in the City of Bothell, in the State of Washington, 98021, USA.

                                                                (the "Licensee")

          WHEREAS:

The  University  has been engaged in research  during the course of which it has
invented, developed and/or acquired certain patents as set out on Schedule "A";

The  University is desirous of entering into this  agreement  (the  "Agreement")
with the objective of furthering society's use of its advanced  technology,  and
to  generate  further  research  in a manner  consistent  with its  status  as a
non-profit, tax exempt educational institution; and

The  Licensee is desirous of the  University  granting an  exclusive  world-wide
license  to  the  Licensee  to  use or  cause  to be  used  such  technology  to
manufacture,  distribute,  market,  sell and/or  license or sublicense  products
derived or developed  solely  within the Field of Use, as  hereinafter  defined,
from such  technology and to sell the same to the general public during the term
of this Agreement.

     NOW  THEREFORE  THIS  AGREEMENT  WITNESSETH  that in  consideration  of the
premises and of the mutual  covenants  herein set forth, the parties hereto have
covenanted and agreed as follows:

1.0  DEFINITIONS:
     ------------

1.1  In this Agreement, unless a contrary intention appears, the following words
     and phrases shall mean:

     (a)  "Accounting":  an accounting  statement  setting out in detail how the
          amount of Revenue was determined;

     (b)  "Affiliated   Company"  or   "Affiliated   Companies":   two  or  more
          corporations  where the relationship  between them is one in which one
          of them is a subsidiary of the other, or both are  subsidiaries of the
          same corporation,  or fifty percent (50%) or more of the voting shares
          of each of them is owned or controlled by the same person, corporation
          or other legal entity;
<PAGE>

                                       -2-

     (c)  "Confidential  Information":  any  part of the  Information  which  is
          designated  by the  University  or Licensee as  confidential,  whether
          orally or in writing but excluding any part of the Information:

          (i)  possessed by the  non-disclosing  party prior to receipt from the
               disclosing  party,  other than through  prior  disclosure  by the
               disclosing  party,  as evidenced  by the business  records of the
               non-disclosing party;

          (ii) published  or  available  to the general  public  otherwise  than
               through a breach of this Agreement;

          (iii)obtained  by the  non-disclosing  party from a third party with a
               valid right to disclose it, provided that said third party is not
               under a confidentiality obligation to the disclosing party; or

          (iv) independently  developed by employees,  agents or  consultants of
               the non-disclosing party who had no knowledge of or access to the
               disclosing  party's  Information  as  evidenced  by the  business
               records of the non-disclosing party;

     (d)  "Date of Commencement" or "Commencement  Date": this Agreement will be
          deemed to have come into force on the Date of Commencement which shall
          be the  ______  day of  ______________,  2001,  and  shall be read and
          construed accordingly;

     (e)  "Effective Date of  Termination":  the date on which this Agreement is
          terminated pursuant to Section 19;

     (f)  "Field of Use":  all fields of use,  save and except the SynGene Field
          of Use;

     (g)  "Improvements": improvements, updates, and enhancements made by either
          the  University  or the Licensee or any  sublicensees  of the Licensee
          relating to the Technology at any time after the Commencement Date;

     (h)  "Information":  any and all Technology  and any and all  Improvements,
          the  terms  and  conditions  of this  Agreement  and any and all oral,
          written,  electronic  or other  communications  and other  information
          disclosed or provided by the parties including any and all analyses or
          conclusions  drawn or derived  therefrom  regarding this Agreement and
          information  developed  or  disclosed  hereunder,  or any  party's raw
          materials,    processes,    formulations,    analytical    procedures,
          methodologies, products, samples and specimens or functions;

     (i)  "Product(s)":  goods manufactured in connection with the use of all or
          some of the Technology and/or any Improvements;

     (j)  "Revenue": all revenues,  receipts,  monies, and the fair market value
          of  all  other  consideration  directly  or  indirectly  collected  or
          received  whether  by way of cash or  credit or any  barter,  benefit,
          advantage,  or concession received by the Licensee from the marketing,
          sublicensing,  manufacturing,  sale or  distribution of the Technology
          and any  Improvements,  and/or any Products in any or all parts of the
          world where the  Licensee is  permitted  by law and this  Agreement to
          market,  manufacture,  sell  or  distribute  the  Technology  and  any
          Improvements, and/or any Products;

<PAGE>

                                       -3-

     (k)  "Royalty Due Dates":  the last working day of March,  June,  September
          and  December  of each and every  year  during  which  this  Agreement
          remains in full force and effect;

     (l)  "SynGene  Field of Use":  the use of  antimicrobial  peptides  for the
          creation and development of disease resistant transgenic plants;

     (m)  "Technology":  any and all  knowledge,  know-how  and/or  technique or
          techniques invented,  developed and/or acquired,  prior to the Date of
          Commencement  by the  University  or the  Licensee  relating  to,  and
          including the technology  described in Schedule "A" hereto, as amended
          from time to time by the parties,  including,  without limitation, all
          research, data, specifications, instructions, manuals, papers or other
          materials  of any nature  whatsoever,  whether  written or  otherwise,
          relating to same; and

     (n)  "UBC Trade-marks": any mark, trade-mark, service mark, logo, insignia,
          seal,  design,  symbol or device used by the  University in any manner
          whatsoever.

2.0  PROPERTY RIGHTS IN AND TO THE TECHNOLOGY:
     -----------------------------------------

2.1  The parties hereto hereby  acknowledge  and agree that the University  owns
     any and all right, title and interest in and to the Technology,  as well as
     any and all Improvements.

2.2  The  Licensee  shall,  at the  request of the  University,  enter into such
     further  agreements and execute any and all documents as may be required to
     ensure that ownership of the Technology and any  Improvements  remains with
     the University.

2.3  On the last  working day of June and December of each and every year during
     which this Agreement  remains in full force and effect,  the Licensee shall
     deliver  in  writing  to  the   University  the  details  of  any  and  all
     Improvements  which the Licensee and any  sublicensees  of the Licensee has
     developed and/or acquired during the previous six month period.

3.0  GRANT OF LICENSE:
     -----------------

3.1  In consideration of the royalty payments reserved herein, and the covenants
     on the part of the Licensee  contained herein, the University hereby grants
     to the Licensee an exclusive  worldwide  license to use and  sublicense the
     Technology  and any  Improvements  solely  within  the  Field of Use and to
     manufacture,  distribute,  and sell  Products  on the terms and  conditions
     hereinafter set forth during the term of this Agreement;

3.2  The license  granted  herein is personal to the Licensee and is not granted
     to any Affiliated Company or Affiliated Companies.

3.3  The Licensee shall not  cross-license  the  Technology or any  Improvements
     without the prior written consent of the University, such consent not to be
     unreasonably withheld.

<PAGE>

                                       -4-

3.4  Notwithstanding  Section 3.1 herein, the parties acknowledge and agree that
     the University may use the Technology and any  Improvements  without charge
     solely  for  research,   scholarly   publication,   educational   or  other
     non-commercial uses.

3.5  The Licensee hereby acknowledges and agrees that the University has granted
     a  license  agreement  (the  "SynGene  License")  to  SynGene  Biotek  Inc.
     ("SynGene")  for the Technology for the SynGene Field of Use . The Licensee
     hereby agrees that it will not claim against the  University or SynGene any
     infringement of any patents or other intellectual property which it owns or
     licenses with respect to the granting of the SynGene  License or use of the
     Technology by SynGene within the SynGene Field of Use.

4.0  SUBLICENSING:
     -------------

4.1  The  Licensee  shall  have the  right to grant  sublicenses  to  Affiliated
     Companies  and other third parties with respect to the  Technology  and any
     Improvements  solely within the Field of Use. The Licensee will furnish the
     University  with a copy of each  sublicense  granted  within 30 days  after
     execution.

4.2  A sublicensee shall not have the right to grant any  sub-sublicenses,  save
     and  except  to third  parties  solely  for the  purpose  of  manufacturing
     products   using   the   Technology   within   the   Field  of  Use.   Such
     sub-sublicensees  shall  not be  granted  the  right  to use  or  sell  the
     Products.  The  Licensee  will furnish the  University  with a copy of each
     sub-sublicense within 30 days after execution.

4.3  All  sublicenses  and  sub-sublicenses   shall  contain  covenants  by  the
     sublicensee  or  sub-sublicensee  to observe and perform  similar terms and
     conditions to those contained in this Agreement.

5.0  ROYALTIES:
     ----------

5.1  Subject  to  Section  9.6(f),  in  consideration  of  the  license  granted
     hereunder,  the Licensee shall pay to the University a royalty comprised of
     3.5% of the Revenue.

5.2  The royalty shall become due and payable within 30 days of each  respective
     Royalty Due Date and shall be calculated with respect to the Revenue in the
     three month period immediately preceding the applicable Royalty Due Date.

5.3  All payments of royalties made by the Licensee to the University  hereunder
     shall be made in U.S.  dollars  without any  reduction  or deduction of any
     nature or kind whatsoever,  except as may be prescribed by Canadian or U.S.
     law.

5.4  Products  shall be deemed to have been sold by the Licensee and included in
     the  Revenue  when  invoiced,  or if not  invoiced,  then  when  delivered,
     shipped, or paid for, whichever is the first. Sublicensing Revenue shall be
     deemed to have been  received by the  Licensee  with respect to each of its
     sublicensees  when such  consideration is actually received by the Licensee
     from its sublicensees.

5.5  Any transaction,  disposition, or other dealing involving the Technology or
     any part thereof  between the Licensee and another  person that is not made
     at fair  market  value  shall be deemed  to have  been made at fair  market
     value, and the fair market value of that transaction, disposition, or other
     dealing  shall  be  added  to  and  deemed  part  of  the  Revenue  or  the
     Sublicensing  Revenue,  as the case may be,  and shall be  included  in the
     calculation of royalties under this Agreement.

<PAGE>

                                       -5-

6.0  MINIMUM ANNUAL ROYALTY:
     -----------------------

6.1  The  Licensee  shall pay the  University  a  minimum  annual  royalties  in
     accordance with the following schedule:

     -----------------------------------------------------------------------
     ANNIVERSARY                                               AMOUNT
     -----------------------------------------------------------------------
     5th anniversary of the Commencement Date                 US$10,000
     -----------------------------------------------------------------------
     6th anniversary of the Commencement Date                 US$20,000
     -----------------------------------------------------------------------
     7th anniversary of the Commence Date and every           US$25,000
     anniversary thereafter
     -----------------------------------------------------------------------

Such  payment  shall be  non-refundable,  except  that the  amount  by which the
minimum royalty as paid exceeds the earned  royalties  payable in any year, such
excess  shall be  credited  against  future  earned  royalties.

6.2  In further  consideration for the license granted  hereunder,  the Licensee
     shall pay to the  University,  in addition  to all other  amounts due under
     this Agreement,  an annual maintenance fee of US$2,000 payable on or before
     January 1st of each year during which this Agreement  remains in full force
     and effect,  commencing on January 2, 2002 (the "Annual  Maintenance Fee").
     Neither  all nor any  part of the  Annual  Maintenance  Fee  paid  shall be
     refundable to the Licensee under any circumstances.

6.3  Royalties payable under this Section or Section 5 are subject to any offset
     permitted by Section 9.6(f).

7.0  PATENTS:
     --------

7.1  The Licensee shall have the right to identify any process,  use or products
     arising out of the Technology and any  Improvements  that may be patentable
     and the  University  shall,  upon the  request  of the  Licensee,  take all
     appropriate  steps to  apply  for a  patent  in the name of the  University
     provided that the Licensee pays all costs of applying for,  registering and
     maintaining the patent in those  jurisdictions  in which the Licensee might
     designate  that a patent is  required.  The  University  shall  provide the
     Licensee  with copies of all  correspondence  and  notices  relating to the
     application,  registration  and  maintenance of the patents  related to the
     Technology in a timely manner.

7.2  On the  issuance of a patent in  accordance  with Section 7.1, the Licensee
     shall have the right to become,  and shall become, the licensee of the same
     pursuant to the terms of this Agreement and Schedule "A" shall be deemed to
     be amended to include such patents, unless Licensee notifies the University
     in writing within six months following issuance of the patent that Licensee
     does not wish to license such patent.

7.3  The Licensee shall pay, on execution of this  Agreement,  to the University
     the sum of $97,862.76 (Cdn) representing reimbursement to the University of
     all  outstanding  costs and any future  costs  incurred  to the date of the
     execution of this Agreement in applying for,  registering  and  maintaining
     the patents in connection with the Technology.

<PAGE>

                                       -6-

7.4  Subject to  Section  9.6(f),  within 30 days of  presentation  of  receipts
     and/or  invoices by the  University  to the  Licensee,  the  Licensee  will
     reimburse  the  University  for all  further  costs  incurred  to date with
     respect  to any  and  all  patents  relating  to  the  Technology  and  any
     Improvements   licensed  hereunder,   and  with  respect  to  any  and  all
     maintenance fees for any and all patents relating to the Technology and any
     Improvements licensed hereunder.

7.5  In the event that  either of the  parties  believes  that there is an issue
     concerning  the  validity or scope of any and all  patents  relating to the
     Technology and/or any of the Improvements  licensed hereunder,  the parties
     shall cooperate in good faith to resolve the matter through a cross-license
     or otherwise.

7.6  The Licensee will ensure proper patent marking for all Technology,  and any
     Improvements  licensed  hereunder  and shall  clearly mark the  appropriate
     patent   numbers  on  any  Products  made  using  the  Technology  and  any
     Improvements or any patented processes used to make such Products.

8.0  EQUITY:
     -------

8.1  As part of the  consideration  for the rights  granted by the University to
     the Licensee  hereunder,  the Licensee hereby agrees to issue, on execution
     of this Agreement, to the University, or its nominee, 125,000 Common shares
     (the  "UBC  Shares")  in  the  capital  of  the   Licensee.   The  Licensee
     acknowledges and agrees that a portion of the UBC Shares shall be issued to
     certain  researchers and institutions who engaged in research in connection
     with  the   Technology,   subject  to   Licensee's   receipt  of  a  signed
     acknowledgment from each party in the form attached hereto as Schedule "B".

8.2  The Licensee also hereby grants an option (the "Option") to the University,
     or its  nominee,  to purchase up to 125,000  Common  shares (the  "Optioned
     Shares") in the capital of the  Licensee at the  exercise  price of US$1.50
     per Optioned Share. The Licensee  acknowledges and agrees that a portion of
     the Optioned Shares shall be issued to certain researchers and institutions
     that  engaged in research in  connection  with the  Technology,  subject to
     Licensee's  receipt of a signed  stock  option  agreement  from each party,
     including the University,  in the form attached hereto as Schedule "C" (the
     "Option Agreement").

8.3  The Option  shall have a term of ten (10) years  commencing  on the Date of
     Commencement  (the "Option  Period"),  and shall be subject to the terms of
     the Option Agreement.

8.4  The Licensee will use its  reasonable  commercial  efforts to cause the UBC
     Shares and the Optioned  Shares to be issued pursuant to this Section 8, to
     be free from any pooling,  escrow or other trading  restrictions  placed on
     such shares by the Licensee or any regulatory authority having jurisdiction
     over the Licensee. The Licensee acknowledges and agrees that the University
     shall  have the  right to  transfer  any or all of the UBC  Shares  and the
     Optioned  Shares  issued  pursuant  to this  Section  8 at any  time to any
     Affiliated Company or to the University of British Columbia Foundation, and
     the  Licensee  shall  take all steps or do such  acts as may be  reasonably
     required to allow such transfer.

<PAGE>

                                       -7-

8.5  The  University  represents  and  warrants  that:  (i) it is not and is not
     acquiring  the UBC Shares  and  Optioned  Shares for the  benefit of a U.S.
     Person,  as that term is defined in Rule 902 of Regulation  S,  promulgated
     under  the  authority  of the  Securities  Act of  1933,  as  amended  (the
     "Securities  Act");  (ii) the UBC Shares and Optioned  Shares are not being
     registered for sale under the Securities Act and may not be transferred for
     value  in  the  United  States  or  to  a  U.S.  Person  except   following
     registration  under the Securities Act or subject to the availability of an
     exemption from such registration;  (iii) it is an accredited  investor,  as
     that term is defined in Rule 501 of  Regulation  D,  promulgated  under the
     authority  of the  Securities  Act;  (iv)  it is  aware  of the  volatility
     historically  associated  with the  Licensee's  equity  securities  and the
     difficulties  which may be encountered  during attempts to sell or transfer
     the  Licensee's  securities  due  to the  applicability  of  "penny  stock"
     regulations and  restrictions  imposed by the United States  Securities and
     Exchange Commission and the National Association of Securities Dealers; and
     (v) it has had the  opportunity  to conduct  any and all due  diligence  it
     believes  necessary to apprise itself of the material factors impacting its
     acquisition  of the UBC  Shares  and  Optioned  Shares.

8.6  The  Licensee  acknowledges  and  agrees  that  it  will  comply  with  all
     applicable  laws and  legislation  with  respect to the issuance of the UBC
     Shares and Optioned Shares pursuant to this Section 8.

8.7  The UBC Shares shall be deemed to be fully paid for by the University as of
     the date of issuance and shall be the absolute  property of the University.
     Neither  all nor any  portion  of the UBC Shares  and the  Optioned  Shares
     issued to the University  pursuant to this Section 8 shall be refundable or
     returned to the Licensee under any circumstances.

8.8  Notwithstanding   any   termination   of  this  Agreement  for  any  reason
     whatsoever, the provisions of this Section 8 shall survive such termination
     and  stay in full  force  and  effect  for so long as the  University  is a
     shareholder of the Licensee.

9.0  DISCLAIMER OF WARRANTY:
     -----------------------

9.1  The University represents and warrants, to the best of the knowledge of the
     University's Industry Liaison Office, that:

     (a)  it has not made and will  not make any  commitments  to third  parties
          inconsistent  with or in  derogation  of the  rights  granted  in this
          License Agreement;

     (b)  it has the legal power to extend the rights granted to the Licensee in
          this Agreement; and

     (c)  it has no notice  of any  claim of  ownership  or  infringement  being
          asserted against it with regard to the Technology.

9.2  Except   as   expressly   set  out   herein,   the   University   makes  no
     representations,  conditions or warranties, either express or implied, with
     respect to the  Technology or any  Improvements  or the  Products.  Without
     limiting the  generality  of the  foregoing,  the  University  specifically
     disclaims  any  implied  warranty,  condition  or  representation  that the
     Technology or any Improvements or the Products:

     (a)  are of merchantable quality; or

     (b)  are fit for a particular purpose.

<PAGE>

                                       -8-

The University shall not be liable for any loss, whether direct,  consequential,
incidental  or special,  which the  Licensee  suffers  arising  from any defect,
error,  fault or failure  to  perform  with  respect  to the  Technology  or any
Improvements  or  Products,  even if the  University  has  been  advised  of the
possibility of such defect,  error, fault or failure. The Licensee  acknowledges
that it has been advised by the  University  to undertake  its own due diligence
with respect to the Technology and any Improvements.

9.3  The  parties  acknowledge  and agree that the  International  Sale of Goods
     Contracts Convention Act and the United Nations Convention on Contracts for
     the International Sale of Goods have no application to this Agreement.

9.4  Except as otherwise  provided  herein,  nothing in this Agreement  shall be
     construed as:

     (a)  a warranty  or  representation  by the  University  as to title to the
          Technology and/or any Improvement or that anything made, used, sold or
          otherwise  disposed of under the license  granted in this Agreement is
          or will be free from infringement of patents, copyrights, trade-marks,
          industrial design or other intellectual property rights;

     (b)  an  obligation  by the  University  to bring or  prosecute  or  defend
          actions or suits against third  parties for  infringement  of patents,
          copyrights,  trade-marks,  industrial  designs  or other  intellectual
          property or contractual rights; or

     (c)  the conferring by the University of the right to use in advertising or
          publicity the name of the University or the UBC Trade-marks.

9.5  Notwithstanding Section 9.4, in the event of an alleged infringement of the
     Technology or any  Improvements or any right with respect to the Technology
     or any  Improvements,  the Licensee  shall have,  upon  receiving the prior
     written  consent of the  University,  such  consent not to be  unreasonably
     withheld,  the right to prosecute  litigation designed to enjoin infringers
     of the Technology or any  Improvements.  Provided that it has first granted
     its prior  written  consent,  the  University  agrees to  co-operate to the
     extent of executing all necessary documents and to vest in the Licensee the
     right to institute  any such suits,  so long as all the direct and indirect
     costs and  expenses of  bringing  and  conducting  any such  litigation  or
     settlement  shall be borne by the Licensee and in such event all recoveries
     shall enure to the Licensee.

9.6  If any complaint alleging  infringement or violation of any patent or other
     proprietary  rights is made  against the Licensee or a  sublicensee  of the
     Licensee with respect to the use of the Technology or any  Improvements  or
     the manufacture, use or sale of the Products, the following procedure shall
     be adopted:

     (a)  the Licensee shall promptly  notify the University upon receipt of any
          such  complaint and shall keep the  University  fully  informed of the
          actions and positions  taken by the  complainant and taken or proposed
          to be taken by the Licensee on behalf of itself or a sublicensee;

     (b)  except as provided in Section 9.6(d),  all costs and expenses incurred
          by the Licensee or any  sublicensee of the Licensee in  investigating,
          resisting,  litigating  and settling  such a complaint,  including the
          payment of any award of damages and/or costs to any third party, shall
          be paid by the Licensee or any  sublicensee  of the  Licensee,  as the
          case may be;

<PAGE>
                                       -9-

     (c)  no decision or action concerning or governing any final disposition of
          the  complaint  shall  be taken  without  full  consultation  with and
          approval by the University, acting reasonably;

     (d)  the  University  may elect to  participate  formally in any litigation
          involving the  complaint to the extent that the court may permit,  but
          any additional  expenses generated by such formal  participation shall
          be paid by the University  (subject to the  possibility of recovery of
          some or all of such additional expenses from the complainant);

     (e)  notwithstanding  Section 9.4, if the  complainant is willing to accept
          an offer of  settlement  and one of the parties to this  Agreement  is
          willing to make or accept  such  offer and the other is not,  then the
          unwilling  party  shall  conduct all  further  proceedings  at its own
          expense,  and shall be responsible for the full amount of any damages,
          costs,  accounting of profits and settlement  costs in excess of those
          provided  in such  offer,  but shall be entitled to retain unto itself
          the  benefit of any  litigated  or settled  result  entailing  a lower
          payment of costs, damages,  accounting of profits and settlement costs
          than that provided in such offer; and

     (f)  the royalties  payable pursuant to this Agreement shall be held by the
          Licensee in trust from the date the  complaint is made until such time
          as  a  resolution  of  the  complaint  has  been  finalized.   If  the
          complainant  prevails in the  complaint,  then the  royalties  held in
          trust by the Licensee  pursuant to this  Section  shall be entitled to
          offset the  royalties  by one-half of such amount,  provided  that the
          amount held in trust by the  Licensee  hereunder  shall not exceed the
          amount paid by the Licensee to the  complainant  in the  settlement or
          other  disposition  of the  complaint.  If the  complainant  does  not
          prevail in the complaint,  then the Licensee shall immediately deliver
          all of the royalties held in trust to the University.

10.0 INDEMNITY AND LIMITATION OF LIABILITY:
     --------------------------------------

10.1 The Licensee hereby indemnifies, holds harmless and defends the University,
     its Board of Governors,  officers,  employees,  faculty, students, invitees
     and  agents  against  any and all  claims  (including  all  legal  fees and
     disbursements  incurred  in  association  therewith)  arising  out  of  the
     exercise of any rights under this Agreement including, without limiting the
     generality of the foregoing,  against any damages or losses,  consequential
     or  otherwise,  arising  from  or out of the use of the  Technology  or any
     Improvements  or Products  licensed under this Agreement by the Licensee or
     its  sublicensees  or their  customers or end-users  howsoever the same may
     arise.

10.2 Subject to Section 10.3, the University's  total  liability,  whether under
     the  express  or  implied  terms  of this  Agreement,  in  tort  (including
     negligence),  or at  common  law,  for any loss or damage  suffered  by the
     Licensee, whether direct, indirect or special, or any other similar or like
     damage that may arise or does arise from any breaches of this  Agreement by
     the  University,  its Board of  Governors,  officers,  employees,  faculty,
     students or agents, shall be limited to the amount of $1,000.00.

10.3 In no event shall the University be liable for  consequential or incidental
     damages  arising  from any breach or  breaches of this  Agreement.

<PAGE>

                                      -10-

10.4 No action, whether in contract or tort (including negligence), or otherwise
     arising out of or in connection with this Agreement,  may be brought by the
     Licensee more than six months after the Licensee has notice of the cause of
     action.

11.0 PUBLICATION AND CONFIDENTIALITY:
     --------------------------------

11.1 The  Information  shall be  developed,  received  and used by the  Licensee
     solely in furtherance  of the purposes set forth in this Agreement  subject
     to the terms and conditions set forth in this Section 11.

11.2 The  Licensee  shall keep and use all of the  Confidential  Information  in
     confidence and will not,  without the  University's  prior written consent,
     disclose any Confidential Information to any person or entity, except those
     of the Licensee's officers, employees and professional advisors who require
     said  Confidential  Information in performing their  obligations under this
     Agreement. The Licensee covenants and agrees that it will take commercially
     reasonable  steps to limit the internal  distribution  of the  Confidential
     Information to only those officers, employees and professional advisors who
     require said Confidential Information in performing their obligations under
     this  Agreement  and who have  signed  confidentiality  and  non-disclosure
     agreements.

11.3 The Licensee shall not use, either directly or indirectly, any Confidential
     Information  for any  purpose  other than as set forth  herein  without the
     University's prior written consent.

11.4 If the  Licensee  is required  by  judicial  or  administrative  process to
     disclose any or all of the  Confidential  Information,  the Licensee  shall
     promptly notify the University and allow the University  reasonable time to
     oppose such process before disclosing any Confidential Information.

11.5 Notwithstanding  any  termination  or  expiration  of this  Agreement,  the
     obligations  created in this  Section 11 shall  survive and be binding upon
     the Licensee, its successors and assigns.

11.6 The  University  shall  not be  restricted  from  presenting  at  symposia,
     national or regional professional  meetings, or from publishing in journals
     or  other   publications,   accounts  of  its  research   relating  to  the
     Information,  provided that with respect to Confidential  Information only,
     the Licensee  shall have been furnished  copies of the disclosure  proposed
     therefor  at least 60 days in advance of the  presentation  or  publication
     date and does not within 30 days after delivery of the proposed  disclosure
     object to such  presentation  or  publication.  Any objection to a proposed
     presentation or publication  shall specify the portions of the presentation
     or publication  considered  objectionable (the  "Objectionable  Material").
     Upon  receipt  of   notification   from  the  Licensee  that  any  proposed
     publication or disclosure contains  Objectionable  Material, the University
     and the Licensee shall work together to revise the proposed  publication or
     presentation  to  remove or alter the  Objectionable  Material  in a manner
     acceptable to the Licensee,  in which case the Licensee  shall withdraw its
     objection.  If an  objection  is  made,  disclosure  of  the  Objectionable
     Material  shall  not be made for a period  of 6 months  after  the date the
     University  has  delivered  to the Licensee  the  proposed  publication  or
     presentation relating to the Objectionable  Material.  The University shall
     co-operate in all reasonable  respects in making  revisions to any proposed
     disclosures  if  considered  by  the  Licensee  to  contain   Objectionable
     Material.  The  University  shall  not be  restricted  from  publishing  or
     presenting the proposed  disclosure as long as the  Objectionable  Material
     has been removed. After the 6 month period has elapsed the University shall
     be free to present and/or publish the proposed  publication or presentation
     whether  or not it  contains  Objectionable  Material.

<PAGE>

                                      -11-

11.7 The Licensee requires of the University,  and the University agrees insofar
     as it may be permitted to do so at law, that this Agreement,  and each part
     of it, is confidential and shall not be disclosed to third parties,  as the
     Licensee  claims that such  disclosure  would or could  reveal  commercial,
     scientific  or  technical  information  and  would  significantly  harm the
     Licensee's  competitive  position  and/or  interfere  with  the  Licensee's
     negotiations  with  prospective   sublicensees.   Notwithstanding  anything
     contained in this Section,  the parties hereto  acknowledge  and agree that
     the  University or Licensee may identify the title of this  Agreement,  the
     parties to this  Agreement and the names of the inventors of the Technology
     and any Improvements.

12.0 PRODUCTION AND MARKETING:
     -------------------------

12.1 The Licensee shall not use any of the UBC  Trade-marks or make reference to
     the  University  or its name in any  advertising  or publicity  whatsoever,
     without the prior written consent of the University (not to be unreasonably
     withheld or delayed),  except as required by law or as  otherwise  provided
     herein.  Without  limiting the  generality of the  foregoing,  the Licensee
     shall not issue a press  release  with  respect  to this  Agreement  or any
     activity  contemplated herein without the prior review and approval of same
     by the  University,  except as required by law. If the Licensee is required
     by law to act in contravention of this Section,  the Licensee shall provide
     the  University  with  sufficient  advance  notice in writing to permit the
     University  to bring an  application  or other  proceeding  to contest  the
     requirement.

12.2 The Licensee will not register or use any  trade-marks in association  with
     the Products  without the prior  written  consent of the  University,  such
     consent  not to be  unreasonably  withheld or  delayed.

12.3 The Licensee represents and warrants to the University that:

     (a)  it has the  infrastructure,  expertise  and  resources  to develop and
          commercialize the Technology and any Improvements;

     (b)  it  has  the  infrastructure,   expertise  and  resources  to  monitor
          compliance of the terms of each sublicense  agreement  entered into by
          the Licensee;

     (c)  it  will  throughout  the  Term  of  this  Agreement  allocate  to the
          development  and   commercialization   of  the  Technology,   and  any
          Improvements  at  least  the  same  degree  of  diligence,  expertise,
          infrastructure,  and  resources as the Licensee is  allocating  to the
          most favoured Product developed and marketed by the Licensee.

12.4 The Licensee shall use commercially reasonable efforts to develop, promote,
     market  and  sell  the  Products  and  utilize  the   Technology   and  any
     Improvements  and to meet or  cause  to be met the  market  demand  for the
     Products and the utilization of the Technology and any Improvements.

12.5 If the  University is of the view that the Licensee is in breach of Section
     12.4, the University shall notify the Licensee and the parties hereto shall
     appoint a  mutually  acceptable  person as an  independent  evaluator  (the
     "Evaluator")  to conduct the  evaluation set forth in Section 12.6. If that
     the parties  cannot agree on such an Evaluator,  the  appointing  authority
     shall be the British Columbia International Commercial Arbitration Centre.

<PAGE>
                                      -12-

12.6 Unless the Parties mutually agree  otherwise,  the following rules and
     procedures shall govern the conduct of the parties and the Evaluator before
     and during the  investigation  by the Evaluator:

     (a)  within 30 days of the  appointment  of the Evaluator  each party shall
          provide to the Evaluator and the other party copies of all  documents,
          statements  and  records  on  which  the  party  intends  to  rely  in
          presenting its position to the Evaluator;

     (b)  within 45 days of the  appointment of the Evaluator the Licensee shall
          provide to the Evaluator and the  University a written  summary of its
          position.  On receipt of the Licensee's  summary the University  shall
          have 15 days to prepare and submit to the Licensee  and the  Evaluator
          its own summary in reply to the summary submitted by the Licensee;

     (c)  on  receipt  of  the  documents,  statements,  records  and  summaries
          submitted by the parties the Evaluator shall have 30 days within which
          to conduct such further  inquiries as he or she may deem necessary for
          the purpose of reviewing the efforts made by the Licensee with respect
          to  the  promotion,  marketing  and  sale  of  the  Products  and  the
          Technology and any Improvements in compliance with the requirements of
          Section  12.4.  For the purpose of  conducting  such an  inquiry,  the
          Evaluator shall have the right to:

          (i)  require either party to disclose any further documents or records
               which the Evaluator considers to be relevant;

          (ii) interview  or  question  either  orally  (or by  way  of  written
               questions) one or more  representatives of either party on issues
               deemed to be relevant by the Evaluator;

          (iii) make an "on site" inspection of the Licensee's facilities;

          (iv) obtain if necessary,  the assistance of an independent  expert to
               provide  technical  information with respect to any area in which
               the Evaluator does not have a specific expertise;

     (d)  On  completion  of  the  Inquiry  described  in  Section  12.6(c)  the
          Evaluator shall within 15 days prepare a report setting out his or her
          findings  and  conclusions  as to  whether  or not  the  Licensee  has
          committed a breach of Section 12.4 on a balance of the probabilities

     (e)  The report and  conclusions of the Evaluator shall be delivered to the
          Licensee and the University,  and shall be accepted by both parties as
          final and binding.

12.7 If the Evaluator concludes:

     (a)  pursuant to Section 12.6(d),  that the Licensee  committed a breach of
          Section 12.4,  then the University  shall at its option have the right
          to terminate this Agreement as provided in Section 19, or continue the
          license granted  hereunder as a  non-exclusive  license upon the terms
          and conditions of this Agreement;

<PAGE>

                                      -13-

     (b)  pursuant  to Section  12.6(d),  that the  Licensee is not in breach of
          Section 12.4,  then the University  shall not terminate this Agreement
          for  breach of  Section  12.4,  nor shall it change  the nature of the
          license granted hereunder.

12.8 The  University  may not call for more  than  one  evaluation  pursuant  to
     Section 12.5 in each calendar  year.  The cost of an  evaluation  hereunder
     shall be borne 50% by the Licensee and 50% by the University.

13.0 ACCOUNTING RECORDS:
     -------------------

13.1 The Licensee shall maintain  separate accounts and records of all Revenues,
     such  accounts  and  records to be in  sufficient  detail to enable  proper
     returns to be made under this  Agreement,  and the Licensee shall cause its
     sublicensees to keep similar accounts and records.

13.2 The Licensee shall deliver to the University on the date 30 days after each
     and every Royalty Due Date,  together with the royalty payable  thereunder,
     the  Accounting  and a report on all  Sublicensing  activity,  including an
     accounting  statement  setting out in detail how the amount of Sublicensing
     Revenue was determined and identifying each sublicensee and the location of
     the business of each sublicensee.

13.3 The  calculation  of  royalties  shall be carried  out in  accordance  with
     generally  accepted  accounting  principles  in the U.S.  ("GAAP"),  or the
     standards and principles adopted by the U.S. Financial Accounting Standards
     Board ("FASB") applied on a consistent basis.

13.4 The Licensee  shall retain the accounts and records  referred to in Section
     13.1 above for at least six years  after the date upon which they were made
     and shall permit any duly  authorized  representative  of the University to
     inspect  such  accounts and records  during  normal  business  hours of the
     Licensee at the  University's  expense.  The  Licensee  shall  furnish such
     reasonable  evidence as such  representative  will deem necessary to verify
     the  Accounting  and will permit such  representative  to make copies of or
     extracts from such  accounts,  records and  agreements at the  University's
     expense. If an inspection of the Licensee's records by the University shows
     an  under-reporting  or  underpayment  by the Licensee of any amount to the
     University,  in excess  of 5% for any 12 month  period,  then the  Licensee
     shall  reimburse the  University  for the cost of the inspection as well as
     pay to the  University  any amount  found due  (including  any late payment
     charges  or  interest)  within 30 days of notice by the  University  to the
     Licensee.

13.5 During the term of this Agreement, and thereafter, the University shall use
     reasonable  efforts  to  ensure  that  all  information   provided  to  the
     University or its representatives pursuant to this Section shall be treated
     as Confidential Information hereunder.

14.0 INSURANCE:
     ----------

14.1 Unless  satisfactory  arrangements  are made  between the  Licensee and the
     University with respect to a self-insurance  program or the requirement for
     insurance  hereunder is waived by the  University  sixty (60) days prior to
     the first sale of a Product,  then the Licensee shall procure and maintain,
     during the term of this Agreement,  the insurance outlined in Sections 14.2
     and 14.3 and otherwise  comply with the insurance  provisions  contained at
     Sections 14.2 and 14.3.

<PAGE>

                                      -14-

14.2 One month  prior to the first sale of a  Product,  the  Licensee  will give
     notice to the  University of the terms and amount of the public  liability,
     product liability and errors and omissions insurance which it has placed in
     respect  of the same,  which in no case  shall be less  than the  insurance
     which a reasonable and prudent businessperson carrying on a similar line of
     business would acquire. This insurance shall be placed with a reputable and
     financially  secure insurance  carrier,  shall include the University,  its
     Board of Governors, faculty, officers,  employees,  students, and agents as
     additional insureds, and shall provide primary coverage with respect to the
     activities  contemplated  by this  Agreement.  Such  policy  shall  include
     severability of interest and cross-liability clauses and shall provide that
     the policy  shall not be  cancelled or  materially  altered  except upon at
     least 30 days' written notice to the University.  The University shall have
     the right to require  reasonable  amendments  to the terms or the amount of
     coverage  contained  in the policy.  Failing  the  parties  agreeing on the
     appropriate  terms or the  amount of  coverage,  then the  matter  shall be
     determined  by  arbitration  as provided  for herein.  The  Licensee  shall
     provide the  University  with  certificates  of insurance  evidencing  such
     coverage  seven days  before  commencement  of sales of any Product and the
     Licensee  covenants  not to sell any  Product  before such  certificate  is
     provided and approved by the University, or to sell any Product at any time
     unless the insurance outlined in this Section 14.2 is in effect.

14.3 The Licensee shall require that each sublicensee under this Agreement shall
     procure and maintain, during the term of the sublicense,  public liability,
     product liability and errors and omissions insurance in reasonable amounts,
     with a reputable and financially  secure  insurance  carrier.  The Licensee
     shall use its best  efforts  to ensure  that any and all such  policies  of
     insurance  required  pursuant  to this  Section  shall  contain a waiver of
     subrogation  against  the  University,  its  Board of  Governors,  faculty,
     officers, employees, students, and agents.

15.0 ASSIGNMENT:
     -----------

15.1 The  Licensee  will not assign,  transfer,  mortgage,  charge or  otherwise
     dispose of any or all of the rights,  duties or  obligations  granted to it
     under this Agreement  without the prior written  consent of the University,
     not to be unreasonably withheld or delayed. Not withstanding the foregoing,
     the Licensee  shall be  permitted  to assign this license to an  Affiliated
     Company.

15.2 The  University  shall  have the right to assign  its  rights,  duties  and
     obligations under this Agreement to a company or society of which it is the
     sole  shareholder,  in the case of a company,  or of which it controls  the
     membership,  in the case of a society.  In the event of such an assignment,
     the Licensee will release, remise and forever discharge the University from
     any and all obligations or covenants, provided however that such company or
     society,  as the case may be,  executes a written  agreement which provides
     that such company or society shall assume all such obligations or covenants
     from the  University  and that the Licensee shall retain all rights granted
     to the Licensee pursuant to this Agreement.

16.0 GOVERNING LAW AND ARBITRATION:
     ------------------------------

16.1 This  Agreement  shall be governed by and construed in accordance  with the
     laws of the  Province of British  Columbia  and the laws of Canada in force
     therein without regard to its conflict of law rules. All parties agree that
     by executing this Agreement they have attorned to the  jurisdiction  of the
     courts of British  Columbia.  Subject to Sections 16.2 and 16.3, the courts
     of British Columbia shall have exclusive jurisdiction over this Agreement.

16.2 In the event of any dispute  arising  between the parties  concerning  this
     Agreement, its enforceability or the interpretation thereof, the same shall
     be  settled  by   arbitration   administered   by  the   British   Columbia
     International  Commercial  Arbitration Centre pursuant to its International
     Commercial  Arbitration Rules and the Commercial Arbitration Act of British
     Columbia,  or any  successor  legislation  then  in  force.  The  place  of
     arbitration shall be Vancouver,  British Columbia.  The language to be used
     in the arbitration  proceedings shall be English. Each party shall bear its
     own costs and expenses and shall share  equally the fees of the  arbitrator
     and any administrative fees

<PAGE>

                                      -15-

16.3 Nothing in Section  16.2 shall  prevent a party  hereto from  applying to a
     court of competent  jurisdiction for interim  protection such as, by way of
     example, an interim injunction.

17.0 NOTICES:
     -------

17.1 All  payments,  reports  and  notices  or other  documents  that any of the
     parties  hereto are  required  or may desire to deliver to any other  party
     hereto may be  delivered  only by  personal  delivery or by  registered  or
     certified mail, telex or fax, all postage and other charges prepaid, at the
     address  for such  party set forth  below or at such  other  address as any
     party may  hereinafter  designate  in  writing  to the  others.  Any notice
     personally  delivered  or sent by telex or fax shall be deemed to have been
     given or received at the time of delivery,  telexing or faxing.  Any notice
     mailed as aforesaid shall be deemed to have been received on the expiration
     of five days after it is  posted,  provided  that if there  shall be at the
     time of mailing or between  the time of mailing  and the actual  receipt of
     the notice a mail strike,  slow down or labour  dispute  which might affect
     the  delivery  of the  notice by the mails,  then the notice  shall only be
     effected if actually received.

If to the University:      The Director
                           University - Industry Liaison Office
                           University of British Columbia
                           IRC 331 - 2194 Health Sciences Mall
                           Vancouver, British Columbia
                           V6T 1Z3
                           Telephone:       (604)822-8580
                           Fax:             (604)822-8589

If to the Licensee:        President
                           Helix BioMedix, Inc.
                           22122 20th Ave. SE, Suite 148
                           Bothell, Washington, 98021
                           USA
                           Telephone:       (425) 402-8400
                           Fax:             (425) 806-2999

18.0 TERM:
     -----

18.1 This Agreement and the license  granted  hereunder  shall  terminate on the
expiration of a term of twenty (20) years from the Date of  Commencement  or the
expiration of the last patent obtained  pursuant to Section 7 herein,  whichever
event shall last occur, unless earlier terminated pursuant to Section 19 herein.

19.0 TERMINATION:
     ------------

19.1 This Agreement shall automatically and immediately terminate without notice
     to the Licensee if any  proceeding  under the Bankruptcy and Insolvency Act
     of Canada,  or any other  statute of similar  purport,  is  commenced by or
     against the Licensee.

<PAGE>

                                      -16-

19.2 The University may, at its option,  terminate this Agreement immediately on
     the  happening  of any one or more of the  following  events by  delivering
     notice in writing to that effect to the Licensee:

     (a)  if the Licensee becomes insolvent;

     (b)  if any  execution,  sequestration,  or any other  process of any court
          becomes  enforceable  against  the  Licensee  in an  amount  exceeding
          $50,000 USD, or if any such process is levied on the rights under this
          Agreement or upon any of the monies due to the  University  and is not
          released or satisfied by the Licensee within 30 days thereafter;

     (c)  if any resolution is passed or order made or other steps taken for the
          winding up,  liquidation or other  termination of the existence of the
          Licensee;

     (d)  if the  Licensee is more than 60 days in arrears of royalties or other
          monies  that  are  due to the  University  under  the  terms  of  this
          Agreement;

     (e)  if the Technology or any Improvements  becomes subject to any security
          interest,  lien,  charge or  encumbrance  in favour of any third party
          claiming through the Licensee;

     (f)  if the Licensee ceases to carry on its business;

     (g)  if the Licensee commits any breach of Sections 12.1 or 14;

     (h)  if it is determined, pursuant to Section 12.6, that the Licensee is in
          breach of Section 12.4;

     (i)  if  any  sublicensee  of  the  Licensee  is in  breach  of a  material
          obligation  of its  sublicense  agreement  with the  Licensee  and the
          Licensee does not cause such  sublicensee  to cure such default within
          60 days of receipt of written  notice  from the  University  requiring
          that the Licensee cause such sublicensee to cure such default, or

     (j)  if the  Licensee  is in  breach  of any other  agreement  between  the
          Licensee and the University which breach has not been cured within the
          time  provided  for the curing of such breach  under the terms of such
          other agreement.

19.3 Other than as set out in Sections  19.1 and 19.2,  if either party shall be
     in default  under or shall fail to comply with the terms of this  Agreement
     then the  non-defaulting  party  shall  have the  right to  terminate  this
     Agreement by written notice to the other party to that effect if:

     (a)  such default is  reasonably  curable  within 30 days after  receipt of
          notice of such  default  and such  default or failure to comply is not
          cured within 30 days after receipt of written notice thereof; or

     (b)  such default is not reasonably curable within 30 days after receipt of
          written notice  thereof,  and such default or failure to comply is not
          cured  within  such  further  reasonable  period  of  time  as  may be
          necessary for the curing of such default or failure to comply.

<PAGE>

                                      -17-

19.4 If this  Agreement is terminated  pursuant to Section 19.1,  19.2, or 19.3,
     the University may proceed to enforce payment of all outstanding  royalties
     or  other  monies  owed  to the  University  up to the  Effective  Date  of
     Termination,  and the  parties  may  exercise  any or all of the rights and
     remedies contained herein or otherwise available to each party by law or in
     equity,  successively or  concurrently.  Upon any such  termination of this
     Agreement,  the Licensee shall  forthwith  deliver up to the University all
     Technology and any Improvements in its possession or control and shall have
     no  further  right  of  any  nature  whatsoever  in the  Technology  or any
     Improvements. The Licensee will pay all charges or expenses incurred by the
     University  in the  enforcement  of its  rights  or  remedies  against  the
     Licensee  including,  without  limitation,  the University's legal fees and
     disbursements on an indemnity basis.

19.5 The Licensee shall cease to use the Technology or any  Improvements  in any
     manner  whatsoever or to manufacture or sell the Products  within five days
     from the Effective Date of Termination.  The Licensee shall then deliver or
     cause to be delivered to the  University an accounting  within 30 days from
     the Effective Date of Termination.  The accounting  will specify,  in or on
     such  terms as the  University  may in its  sole  discretion  require,  the
     inventory or stock of Products  manufactured  and  remaining  unsold on the
     Effective Date of Termination. The University will instruct that the unsold
     Products be stored,  destroyed or sold under its  direction,  provided this
     Agreement was terminated pursuant to Section 19.2 or 19.3. Without limiting
     the generality of the foregoing,  if this Agreement was terminated pursuant
     to Section 19.1, the unsold  Products will not be sold by any party without
     the  prior  written  consent  of the  University,  not  to be  unreasonably
     withheld or delayed. The Licensee will continue to make royalty payments to
     the  University  in the same  manner  specified  in Section 5 on all unsold
     Products   that  are  sold  in   accordance   with   this   Section   19.5,
     notwithstanding  anything  contained  in or any  exercise  of rights by the
     University under Section 19.4 herein.

19.6 Notwithstanding the termination of this Agreement,  Section 13 shall remain
     in full force and effect until six years after

     (a)  all  payments of royalty  required  to be made by the  Licensee to the
          University  under this Agreement have been made by the Licensee to the
          University, and

     (b)  any  other  claim or claims of any  nature or kind  whatsoever  of the
          University against the Licensee has been settled.

20.0 MISCELLANEOUS COVENANTS:
     ------------------------

20.1 The Licensee  hereby  represents  and warrants to the  University  that the
     Licensee is a  corporation  duly  organized,  existing and in good standing
     under the laws of the State of Delaware  and has the power,  authority  and
     capacity  to enter into this  Agreement  and to carry out the  transactions
     contemplated  by this  Agreement,  all of which have been duly and  validly
     authorized by all requisite corporate proceedings.

20.2 The Licensee  represents  and warrants  that it has the expertise to handle
     the  Technology  and any  Improvements  with care.  The Licensee  shall not
     accept  delivery  of  the  Technology  or  any  Improvements  until  it has
     requested and received from the  University all necessary  information  and
     advice to ensure  that it is capable of  handling  the  Technology  and any
     Improvements in a safe and prudent manner.

<PAGE>

                                      -18-

20.3 Each party shall comply with all laws, regulations and ordinances,  whether
     Federal, State, Provincial, County, Municipal or otherwise, with respect to
     the Technology and any Improvements and/or this Agreement.

20.4 All payments made pursuant to this  Agreement  shall be made free and clear
     of any  deductions  whatsoever,  whether for any  present or future  taxes,
     levies  or  charges.  If the  Licensee  is  compelled  by law to  deduct or
     withhold  any amount from any payment,  then the Licensee  shall pay to the
     University such additional  amount or amounts as may be necessary to ensure
     that the  University  receives a net amount  equal to the full amount which
     would  have  been  received  had  the  payment  not  been  subject  to such
     deduction,  provided that the University timely complete all U.S. tax forms
     reasonably  requested by Licensee to enable  Licensee to claim an exemption
     from withholding requirements.

20.5 The  obligation  of the  Licensee to make all  payments  hereunder  will be
     absolute and  unconditional  and will not,  except as expressly  set out in
     this  Agreement,  be  affected  by  any  circumstance,   including  without
     limitation any set-off, compensation,  counterclaim, recoupment, defence or
     other right which the Licensee may have against the  University,  or anyone
     else for any reason whatsoever.

20.6 All amounts due and owing to the  University  hereunder but not paid by the
     Licensee on the due date thereof shall bear interest at the rate of one per
     cent (1 %) per month.  Such interest  shall accrue on the balance of unpaid
     amounts from time to time  outstanding  from the date on which  portions of
     such amounts become due and owing until payment thereof in full.

20.7 The Licensee shall, at the University's request,  provide to the University
     and/or its scientific personnel an annual written report that documents the
     progress on the development of the Technology and any Improvements.

20.8 The Licensee shall,  within 36 months after the  Commencement  Date,  enter
     into a  sublicensing,  joint  venture or  strategic  partnership  agreement
     relating  to the  use of  the  Technology  and/or  any  Improvements  in an
     industrial or pharmaceutical  application or directly use the Technology in
     either application.

21.0 GENERAL:
     --------

21.1 Upon not less than ten (10)  business  days prior  written  notice from the
     University, the Licensee shall permit any duly authorized representative of
     the University,  during normal business hours and at the University's  sole
     risk and  expense,  to enter upon and into any premises of the Licensee for
     the purpose of inspecting the Products and the manner of their  manufacture
     and  generally  of  ascertaining  whether  or not  the  provisions  of this
     Agreement have been,  are being,  or will be complied with by the Licensee,
     no more frequently than once per year.

21.2 Nothing contained herein shall be deemed or construed to create between the
     parties  hereto a  partnership  or joint  venture.  No party shall have the
     authority to act on behalf of any other party, or to commit any other party
     in any manner or cause  whatsoever  or to use any other party's name in any
     way not specifically authorized by this Agreement. No party shall be liable
     for any act,  omission,  representation,  obligation  or debt of any  other
     party, even if informed of such act, omission,  representation,  obligation
     or debt.

21.3 Subject to the  limitations  hereinbefore  expressed,  this Agreement shall
     enure  to  the  benefit  of and be  binding  upon  the  parties  and  their
     respective successors and permitted assigns.

<PAGE>
                                      -19-

21.4 No condoning,  excusing or overlooking by any party of any default,  breach
     or non-observance by any other party at any time or times in respect of any
     covenants,  provisos or  conditions  of this  Agreement  shall operate as a
     waiver of such  party's  rights  under  this  Agreement  in  respect of any
     continuing or subsequent default, breach or non-observance, so as to defeat
     in any way the rights of such party in  respect of any such  continuing  or
     subsequent  default  or breach,  and no waiver  shall be  inferred  from or
     implied by  anything  done or omitted by such  party,  save only an express
     waiver in writing.

21.5 No exercise of a specific right or remedy by any party precludes it from or
     prejudices it in exercising  another  right or pursuing  another  remedy or
     maintaining  an action to which it may otherwise be entitled  either at law
     or in equity.

21.6 Marginal  headings as used in this  Agreement  are for the  convenience  of
     reference only and do not form a part of this Agreement and are not be used
     in the interpretation hereof.

21.7 The  terms and  provisions,  covenants  and  conditions  contained  in this
     Agreement  which by the  terms  hereof  require  their  performance  by the
     parties hereto after the expiration or termination of this Agreement  shall
     be and remain in force notwithstanding such expiration or other termination
     of this Agreement for any reason whatsoever.

21.8 If any section,  article, part, section,  clause, paragraph or subparagraph
     of this  Agreement  shall be held to be  indefinite,  invalid,  illegal  or
     otherwise voidable or unenforceable, the entire Agreement shall not fail on
     account  thereof,  and the balance of this Agreement shall continue in full
     force and effect.

21.9 The parties  hereto each  acknowledge  that the law firm of Richards  Buell
     Sutton  has  acted  solely  for the  University  in  connection  with  this
     Agreement  and that all other  parties  hereto  have been  advised  to seek
     independent legal advice.

21.10 This Agreement sets forth the entire understanding between the parties and
      no modifications hereof shall be binding unless executed in writing by the
      parties hereto.

21.11 Time shall be of the essence of this Agreement.

21.12 Whenever  the singular  or  masculine  or neuter is used  throughout  this
      Agreement the same shall be construed as meaning the plural or feminine or
      body corporate when the context or the parties hereto may require.

<PAGE>

     IN WITNESS WHEREOF the parties hereto have hereunto executed this Agreement
on the ________ day of  ______________________,  2001,  but  effective as of the
Date of Commencement.

SIGNED FOR AND ON BEHALF of                    )
THE UNIVERSITY OF BRITISH COLUMBIA             )
by its duly authorized officers:               )
                                               )
                                               )
-----------------------------------------      )
Authorized Signatory                           )
                                               )
-----------------------------------------      )
Authorized Signatory                           )
                                               )

THE CORPORATE SEAL of                          )
HELIX BIOMEDIX, INC.                           )
was hereunto affixed in the presence of:       )
                                               )
                                               )        c/s
-----------------------------------------      )
Authorized Signatory                           )
                                               )
-----------------------------------------      )
Authorized Signatory                           )

<PAGE>

                                  SCHEDULE "A"
                                  ------------

                           DESCRIPTION OF "TECHNOLOGY"
                           ---------------------------
<TABLE>
<CAPTION>

-------------- ------------ ----------------- ---------------------------------------- -------------------- -----------
  UBC File       Country    USSN/Patent No.                    Title                        Inventors       Filed/
                                                                                                              Issued
-------------- ------------ ----------------- ---------------------------------------- -------------------- -----------
<S>            <C>          <C>               <C>                                      <C>                  <C>
   98-005          USA         09/143,124     Anti-Endotoxic , Antimicrobial           Hancock, REW          8/28/98
                                              Cationic Peptides and Methods of Use     Gough, M
                                              Therefor                                 Patrzykat, A
                                                                                       Woods, D
                                                                                       Jia X
-------------- ------------ ----------------- ---------------------------------------- -------------------- -----------
   98-005          PCT        WO 00/12528     Anti-Endotoxic , Antimicrobial           As above              8/27/99
                                              Cationic Peptides and Methods of Use
                                              Therefor
-------------- ------------ ----------------- ---------------------------------------- -------------------- -----------
   98-005        Canada                       Anti-Endotoxic , Antimicrobial           As above             National
                                              Cationic Peptides and Methods of Use                          Phase
                                              Therefor                                                       2/28/01
-------------- ------------ ----------------- ---------------------------------------- -------------------- -----------
   98-005        Europe                       Anti-Endotoxic , Antimicrobial           As Above             National
                                              Cationic Peptides and Methods of Use                          Phase
                                              Therefor                                                       3/28/01
-------------- ------------ ----------------- ---------------------------------------- -------------------- -----------
   98-005       Australia                     Anti-Endotoxic , Antimicrobial           As Above             National
                                              Cationic Peptides and Methods of Use                          Phase
                                              Therefor                                                       3/28/01
-------------- ------------ ----------------- ---------------------------------------- -------------------- -----------
   98-006          USA         6,172,185      Antimicrobial Cationic Peptide           Hancock, REW         Issued
                                              Derivatives of Bactenecin                Wu, M                  1/9/01
-------------- ------------ ----------------- ---------------------------------------- -------------------- -----------
   00-005          USA         09/604,864     Antimicrobial Peptides and Methods of    Hancock, REW          7/27/00
                                              Use Thereof                              Zhang, L.
-------------- ------------ ----------------- ---------------------------------------- -------------------- -----------
</TABLE>

<PAGE>

                                  SCHEDULE "B"
                                  ------------

                             FORM OF ACKNOWLEDGMENT
                             ----------------------

     The   undersigned,   in  connection   with  the  License   Agreement  dated
________________,  2001 between  Helix  BioMedix,  Inc., a Delaware  corporation
("Helix") and The University of British  Columbia (the "License  Agreement") and
that certain Stock Option  Agreement dated  ___________,  2001 between Helix and
each  party  listed  on  Exhibit  A  hereto  (the  "Option  Agreement"),  hereby
represents and warrants as follows below.  Certain capitalized terms not defined
below are intended to have those meanings  assigned in the License Agreement and
Option Agreement:

1. That  either (i) he or she is not a U.S.  Person,  as that term is defined in
Rule 902 of Regulation S, promulgated  under the United States Securities Act of
1933, as amended (the "Securities Act"), and that he or she is not acquiring the
UBC Shares or Optioned Shares for the benefit of any U.S. Person;  or (ii) he or
she is an accredited  investor as that term is defined in Rule 501 of Regulation
D,  promulgated  under the authority of the  Securities Act and is acquiring the
UBC Shares and Optioned  Shares for  investment  purposes and not with a view to
the distribution thereof;

2. That he or she is aware that UBC Shares and the Optioned Shares are not being
registered   under  the  Securities  Act  and  may  only  be  sold  pursuant  to
registration  thereunder or an exemption from the  registration  requirements of
the Securities Act; and

3. That he or she is aware of and understands the implications of the historical
volatility of Helix's  common stock,  as well as the potential  difficulties  in
effecting  transactions  in Helix's common stock as a result of regulations  and
restrictions applicable to securities deemed "penny-stocks" generally.

         Acknowledged, this __ day of ___________________, 2001.

                                        -----------------------------------
                                        [Name of Stockholder/Optionee]
<PAGE>

                                    Exhibit A
                                    ---------

Monisha Gough
Aleksander Patrzykat
Xiaoyan Jia
University of Calgary
Donald Woods
Canadian Bacterial Diseases Network
Manhong Wu
Lijuan Zhang

<PAGE>
                                 SCHEDULE "C"
                                  ------------

                            FORM OF OPTION AGREEMENT
                            ------------------------

                             STOCK OPTION AGREEMENT
                           Dated ____________ __, 2001

     A  STOCK  OPTION  for a total  of  _____________  shares  of  common  stock
(hereinafter the "Option"), of Helix BioMedix, Inc., a Delaware corporation (the
"Company"), is hereby granted to  _______________________  (the "Optionee"),  at
the price and subject to the terms and provisions set forth below.  For purposes
of this Agreement the term "shares" shall be deemed to apply to shares of common
stock of the Company as of the date hereof.

OPTION PRICE.  The option price is $1.50 for each share.

VESTING AND EXERCISE OF OPTION.  The Option shall be fully vested on the date of
     the grant and may be exercised in accordance with the following provisions:

Method of Exercise.   The Option shall be exercisable by a written notice, which
-------------------    shall:

          state the election  to exercise  the  Option,  the number of shares in
               respect of which it is being exercised;

          contain  such  representations  and  agreements  as  to  the  holder's
               investment  intent with  respect to such shares of common  stock,
               acquired by exercise of the Option, as may be satisfactory to the
               Company;

          be signed by the person entitled to the Option; and

          be in writing  and  delivered in  person or by  certified  mail to the
               President or Secretary of the Company.

               Payment of the purchase price of any shares with respect to which
               an Option is being exercised  shall be by check.  The certificate
               or certificates for shares of common stock as to which the Option
               shall be exercised  shall be registered in the name of the person
               exercising the Option.  Options  hereunder may not at any time be
               exercised for a fractional number of shares.

Restrictions on Exercise.
-------------------------
No Option may be  exercised if the  issuance of the shares upon  exercise  would
constitute a violation of any  applicable  federal or state  securities or other
law or valid  regulation.  As a  condition  to the  exercise  of this Option the
Company may require the person exercising the Option to make any  representation
and warranty to the Company as the Company's counsel believes may be required by
any applicable law or regulations.

     The following legend will appear on all certificates for option shares:

<PAGE>

         THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
         UNDER THE SECURITIES  ACT OF 1933, AS AMENDED,  AND ARE ACQUIRED BY THE
         REGISTERED HOLDER PURSUANT TO  REPRESENTATION  THAT THE HOLDER IS NOT A
         U.S. PERSON AND IS ACQUIRING THESE SHARES FOR THE HOLDER'S OWN ACCOUNT,
         FOR INVESTMENT.  THESE SHARES MAY NOT BE PLEDGED,  HYPOTHECATED,  SOLD,
         TRANSFERRED  OR  OFFERED  FOR SALE IN the  UNITED  STATES  OR TO A U.S.
         PERSON IN THE ABSENCE OF AN EFFECTIVE  REGISTRATION STATEMENT AS TO THE
         SHARES UNDER THE  SECURITIES  ACT OF 1933, AS AMENDED,  OR AN EXEMPTION
         FROM SUCH REGISTRATION STATEMENT.

Non-Transferability of Option.
------------------------------
     Except  as  otherwise  provided  herein,  no Option  may be sold,  pledged,
     assigned  or  transferred  for  value to any U.S.  Person,  as that term is
     defined in Rule 902 of Regulation S, promulgated under the authority of the
     Securities Act of 1933, as amended,  except in the event of registration of
     the  Option  and  the  underlying  shares  under  Act or in the  case of an
     exemption from the  registration  requirements of the Act. The terms of the
     Option  shall  be  binding  upon  the  executors,  administrators,   heirs,
     successors, and assigns of the Optionee.

Term of Option.
---------------
     The Option may be exercised within ten (10) years from the date of original
     grant,  and may be exercised  during such term only in accordance  with the
     terms of this agreement.

Adjustments Upon Changes in Capitalization.
-------------------------------------------
     The number and kind of shares of common stock  subject to this Option shall
     be  appropriately  adjusted  along with a  corresponding  adjustment in the
     Option price to reflect any stock  dividend,  stock split,  split-up or any
     combination, exchange or change of shares, however accomplished.

DATED:          , 2001               Helix BioMedix, Inc.
      ----------

                                     By  /s/ R. Stephen Beatty
                                         -------------------------------------
                                         R. Stephen Beatty
                                         President and Chief Executive Officer

     Optionee  acknowledges  and represents that s/he is familiar with the terms
and  provisions  of this Stock  Option  Agreement  as set forth above and hereby
accepts this Option  subject to all the terms and  provisions  hereof.  Optionee
hereby  agrees to accept as binding,  conclusive  and final all decisions of the
Company's Board of Directors with respect to the interpretation of any provision
under this Stock Option Agreement.

DATED:          , 2001               OPTIONEE
      ----------

                                     By
                                         -------------------------------------

                                         -------------------------------------
                                        Its:
                                            ----------------------------------

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