Document:

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EXHIBIT 10.5                                      CONFIDENTIAL TREATMENT
                                           GENOMETRIX INCORPORATED HAS REQUESTED
                                           THAT THE MARKED PORTIONS OF THIS
                                           DOCUMENT BE ACCORDED CONFIDENTIAL
                                           TREATMENT PURSUANT TO RULE 406 UNDER
                                           THE SECURITIES ACT OF 1933, AS
                                           AMENDED.

                           EXCLUSIVE LICENSE AGREEMENT

         This Exclusive License Agreement (hereinafter called "Agreement"), to
be effective as of the 31st day of May, 1998 (hereinafter called "Agreement
Date"), is by and between Baylor College of Medicine (hereinafter called
"BAYLOR"), a Texas nonprofit corporation having its principal place of business
at One Baylor Plaza, Houston, Texas 77030, and Genometrix, Inc., a corporation
organized under the laws of Delaware and having a principal place of business at
3608 Research Forest Drive, Suite B7, The Woodlands, Texas 77381, and its
Affiliates (hereinafter, collectively referred to as "GENOMETRIX").

         WITNESSETH:

         WHEREAS, scientists at BAYLOR and GENOMETRIX have invented the Subject
Technology (as defined below) under and pursuant to that certain Collaboration
Agreement dated May 28, 1993, as amended November 5, 1993, among Houston
Advanced Research Center (hereinafter called "HARC"), Massachusetts Institute of
Technology (hereinafter called "MIT"), BAYLOR, Beckman Instruments, Inc.
(hereinafter called "BECKMAN"), Microfab Technologies, Inc., Genosys
Biotechnologies, Inc., Triplex Pharmaceutical Corporation, Laboratories for
Genetic Services and GENOMETRIX (hereinafter called "the Collaboration
Agreement") which agreement includes as Appendix C thereto the Technology
Transfer and Royalty-Sharing Agreement dated May 28, 1993 among HARC, MIT and
BAYLOR (the "Tech Transfer Agreement") under which inventions made by the
parties thereto are jointly pooled and administered, a copy of which agreements
are attached hereto as Exhibit A; and

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         WHEREAS, the aforementioned inventors have each assigned all their
respective rights to the invention to his/her respective employers; and

         WHEREAS, pursuant to the Collaboration Agreement, BAYLOR notified MIT
of the making of the invention of the Subject Technology which is defined in the
Collaboration Agreement as a Foreground Invention, and MIT by its letter of
February 6, 1996, notified BECKMAN of the disclosure by BAYLOR of the making of
the invention of said Subject Technology; and

         WHEREAS, BECKMAN by its letter of September 10, 1996, notified MIT that
BECKMAN had elected not to seek patent protection for the subject matter of the
Subject Technology, a copy of which letters are attached as Exhibit B; and

         WHEREAS, pursuant to that certain Letter Agreement among BAYLOR, MIT
and HARC dated April 30, 1997, a copy of which is attached hereto as Exhibit C,
BAYLOR, MIT and HARC agreed: (i) that the Subject Technology is expressly
excluded from the Tech Transfer Agreement; and (ii) that BAYLOR may in
accordance therewith file patent applications on the Subject Technology and
execute an exclusive license agreement with GENOMETRIX with respect to BAYLOR's
rights in and to the Subject Technology; and

         WHEREAS, BAYLOR is willing to grant an exclusive, worldwide, perpetual
license to BAYLOR's rights in and to the Subject Technology to GENOMETRIX on the
terms set forth herein; and

         WHEREAS, GENOMETRIX desires to obtain said exclusive license to said
rights under the Subject Technology.

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         NOW, THEREFORE, for and in consideration of the premises and other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Parties hereto expressly agree as follows:

1.       DEFINITIONS AS USED HEREIN

         1.1 The term "Subject Technology" shall mean United States Patent
Application Serial No. 08/749,967, entitled "Integrated Nucleic Acid
Hybridization Devices Based Upon Active Surface Chemistry," which was filed on
November 14, 1996, on which Michael Hogan, Ph.D., Tom Powdrill, Ph.D., Bonnie
Iverson, Du Xiao and Nobuko Akiyama, employees of BAYLOR (hereinafter
collectively called "the Baylor Inventors") and Arnab Mallik, an employee of
GENOMETRIX, are listed as inventors, together with all other pending United
States patent applications or parts thereof and any United States patent which
issues from any such pending applications and any and all divisions, reissues,
re-examinations, renewals, continuations, continuations-in-part, and extensions
thereof, and all other counterpart, pending or issued patents in all other
countries.

         1.2 The term "Licensed Product(s)" shall mean all products that
incorporate, utilize or are made with the use of the Subject Technology.

         1.3 The term "Research Field" shall mean the research market.

         1.4 The term "Clinical Field" shall mean the clinical diagnostic
market.

         1.5 The term "Net Sales" shall mean the gross amount of monies or cash
equivalent or other consideration which is paid by unrelated third parties to
GENOMETRIX for the Licensed Products by sale or other mode of transfer, less all
trade, quantity and cash discounts actually allowed, credits, and allowances,
actually granted on account of rejections, returns, or billing errors, duties,
transportation and insurance, taxes and other governmental charges actually

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paid. The term "Net Sales" in the case of non-cash sales, shall mean the fair
market value of all equivalent or other consideration received by GENOMETRIX for
the Licensed Products.

         1.6 The term "Affiliates" shall mean any corporation, partnership,
joint venture or other entity of which the common stock or other equity
ownership thereof is twenty five percent (25%) or more owned by GENOMETRIX.

         1.7 The term "the Parties" shall mean GENOMETRIX and BAYLOR.

2.       GRANT OF LICENSE

         2.1 BAYLOR hereby grants to GENOMETRIX an exclusive, worldwide,
perpetual right and license to BAYLOR's rights under the Subject Technology,
with the right to grant sublicenses to make, have made, use, market, sell and
offer to sell Licensed Products.

         2.2 The grant in Section 2.1 shall be further subject to and restricted
by the following reserved rights:

                  (i) the use of the Subject Technology by BAYLOR, MIT and HARC
         for non-commercial research, patient care, teaching and other
         educationally related purposes;

                  (ii) the use of the Subject Technology by the Baylor Inventors
         for non-commercial research purposes at academic or research
         institutions;

                  (iii) the freedom from assertion with respect to any patents
         issued on the Subject Technology in-so-far as the use of the Subject
         Technology relates to Genosensor Systems (as defined in the
         Collaboration Agreement), specifically under and pursuant to Paragraph
         2.3 of the Collaboration Agreement; and

                  (iv) any non-exclusive license of the Subject Technology that
         BAYLOR, MIT, GENOMETRIX or any other party to the Collaboration
         Agreement is required by law or

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                                            CONFIDENTIAL MATERIAL OMITTED AND
                                            FILED SEPARATELY WITH THE SECURITIES
                                            AND EXCHANGE COMMISSION. ASTERISKS
                                            DENOTE SUCH OMISSIONS.

         regulation to grant to the United States of America or any agency
         thereof or to a foreign state pursuant to an existing or future treaty
         with the United States of America.

3.       PAYMENTS

         3.1 As full consideration for the rights conveyed by BAYLOR under this
Agreement, GENOMETRIX shall pay BAYLOR a license fee of ******************** to
recover the costs of filing the provisional patent application on the invention
included within the Subject Technology upon reaching Net Sales of
 ******************.

         3.2 Should GENOMETRIX fail to make any payment whatsoever due and
payable to BAYLOR hereunder, BAYLOR may, at its sole option, terminate this
Agreement as provided in Paragraph 6.2.

         3.3 All payments due hereunder are expressed in and shall be paid by
check payable in United States of America currency, without deduction of
exchange, collection or other charges, to BAYLOR, or to the account of BAYLOR at
such other bank as BAYLOR may from time to time designate by notice to
GENOMETRIX.

         3.4 All payments shall be sent to the address listed in Paragraph 10.1.

4.       SUBLICENSES

         All sublicenses granted by GENOMETRIX of its rights hereunder shall be
subject to the terms of this Agreement. GENOMETRIX shall be responsible for its
sublicensees and shall not grant any rights which are inconsistent with the
rights granted to and obligations of GENOMETRIX hereunder. Any act or omission
of a sublicensee which would be a breach of

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this Agreement if performed by GENOMETRIX shall be deemed to be a breach by
GENOMETRIX of this Agreement. No such sublicense agreement shall contain any
provision which would cause it to extend beyond the term of this Agreement.
GENOMETRIX shall give BAYLOR prompt notification and address of each sublicensee
with whom it concludes a sublicense agreement and shall supply BAYLOR with a
copy of each such sublicense agreement.

5.       PATENTS AND INFRINGEMENT

         5.1 GENOMETRIX agrees to pay all costs incident to the filing,
prosecuting and maintaining of the Subject Technology in the United States and
elected foreign countries, and any and all costs incurred in filing
continuations, continuations-in-part, divisionals or related applications
thereon and any re-examination or reissue proceedings thereof.

         5.2 In the event that GENOMETRIX decides not to: (i) continue
prosecution of the Subject Technology to issuance or (ii) maintain any United
States or foreign issued patent on the Subject Technology, GENOMETRIX shall
timely notify BAYLOR in writing thereof in order that BAYLOR may continue: (i)
said prosecution of such patent applications or (ii) said maintenance of issued
patents at its own expense. GENOMETRIX's right under this Agreement to make,
have made, use, market, sell or offer to sell the Subject Technology under this
patent shall immediately terminate upon the giving of such notice. If GENOMETRIX
fails to notify BAYLOR in sufficient time for BAYLOR to assume said costs,
GENOMETRIX shall be considered in default of this Agreement.

         5.3 BAYLOR agrees to keep GENOMETRIX fully informed, at GENOMETRIX's
expense, of all prosecutions and other actions pursuant to this Section 5,
except for

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applications/patents for which GENOMETRIX elects to discontinue
prosecution/maintenance, including submitting to GENOMETRIX copies of all
official actions and responses thereto.

         5.4 BAYLOR agrees to reasonably cooperate with GENOMETRIX to whatever
extent is reasonably necessary to procure the Subject Technology, including
executing any and all documents reasonably required to provide GENOMETRIX the
full benefit of the license granted herein.

         5.5 Each Party shall promptly inform the other of any suspected
infringement of any claims in the Subject Technology or the misuse,
misappropriation, theft or breach of confidence of other proprietary rights in
the Subject Technology by a third party and with respect to such activities as
are suspected, GENOMETRIX shall have the right, but not the obligation, to
institute an action for infringement, misuse, misappropriation, theft or breach
of confidence of the proprietary rights against such third party. If GENOMETRIX
fails to bring such an action or proceeding within a period of three (3) months
after receiving notice or otherwise having knowledge of such infringement, then
BAYLOR shall have the right, but not the obligation, to prosecute the same at
its own expense. Should either BAYLOR or GENOMETRIX commence suit under the
provisions of this Paragraph 5.5 and thereafter elect to abandon the same, it
shall give timely notice to the other Party who may, if it so desires, continue
prosecution of such action or proceeding. All recoveries, whether by judgment,
award, decree or settlement, from infringement or misuse of Subject Technology
shall be apportioned as follows; the Party bringing the action or proceeding
shall first recover an amount equal to two (2) times the costs and expenses
incurred by such Party directly related to the prosecution of such action or
proceeding and the remainder shall be divided equally between GENOMETRIX and
BAYLOR.

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         5.6 Neither BAYLOR nor GENOMETRIX shall settle any action covered by
Paragraph 5.5 without first obtaining the consent of the other Party, which
consent will not be unreasonably withheld.

         5.7 BAYLOR shall not be liable for any losses incurred as the result of
an action for infringement brought against GENOMETRIX as the result of
GENOMETRIX's exercise of any right granted under this Agreement. The decision to
defend or not defend shall be in GENOMETRIX's sole discretion.

6.       TERM AND TERMINATION

         6.1 Unless earlier terminated as hereinafter provided, GENOMETRIX shall
have a perpetual, royalty-free license to the Subject Technology.

         6.2 In the event of default or failure by GENOMETRIX to perform any of
the terms, covenants or provisions of this Agreement, GENOMETRIX shall have
thirty (30) days after the giving of written notice of such default by BAYLOR to
correct such default. If such default is not corrected within the said thirty
(30) day period, BAYLOR shall have the right, at its option, to cancel, and
terminate this Agreement. The failure of BAYLOR to exercise such right of
termination for non-payment of fees or otherwise, shall not be deemed to be a
waiver of any right BAYLOR might have, nor shall such failure preclude BAYLOR
from exercising or enforcing said right upon any subsequent failure by
GENOMETRIX.

         6.3 BAYLOR shall have the right, at its option, to cancel and terminate
this Agreement in the event that GENOMETRIX shall (i) become involved in
insolvency, dissolution, bankruptcy or receivership proceedings affecting the
operation of its business or (ii)

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make an assignment of all or substantially all of its assets for the benefit of
creditors, or in the event that (iii) a receiver or trustee is appointed for
GENOMETRIX and GENOMETRIX shall, after the expiration of thirty (30) days
following any of the events enumerated above, have been unable to secure a
dismissal, stay or other suspension of such proceedings. In the event of
termination of this Agreement, all of BAYLOR's rights in and to the Subject
Technology shall revert to BAYLOR.

         6.4 At the date of any termination of this Agreement pursuant to
Paragraph 6.2 hereof for breach by GENOMETRIX or pursuant to Paragraph 6.3
hereof, as of the receipt by GENOMETRIX of notice of such termination, all of
BAYLOR's rights in and to the Subject Technology shall revert to BAYLOR.

         6.5 No termination of this Agreement shall constitute a termination or
a waiver of any rights of either Party against the other Party accruing at or
prior to the time of such termination. The obligations of Sections 4 and 11
shall survive termination of this Agreement.

7.       ASSIGNABILITY
         This Agreement shall be binding upon and shall inure to the benefit of
BAYLOR and its assigns and successors in interest, and shall be binding upon and
shall inure to the benefit of GENOMETRIX and the successor to all or
substantially all of its assets or business to which this Agreement relates, but
shall not otherwise be assignable or assigned by GENOMETRIX without prior
written approval by BAYLOR being first obtained, which approval shall not be
unreasonably withheld.

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8.       GOVERNMENTAL COMPLIANCE

         GENOMETRIX shall at all times during the term of this Agreement and for
so long as it shall use the Subject Technology or sell Licensed Products comply
and cause its sublicensees to comply with all laws that may control the import,
export, manufacture, use, sale, marketing, distribution and other commercial
exploitation of Licensed Products or any other activity undertaken pursuant to
this Agreement.

9.       GOVERNING LAW

         This Agreement shall be deemed to be subject to, and have been made
under, and shall be construed and interpreted in accordance with the laws of the
State of Texas. This Agreement is expressly acknowledged to be subject to all
federal laws including, but not limited to, the Export Administration Act of the
United States of America. No conflict-of-laws rule or law that might refer such
construction and interpretation to the laws of another state, republic, or
country shall be considered.

         This Agreement is performable in part in Harris County Texas. and the
Parties mutually agree that personal jurisdiction and venue shall be proper in
the state and federal courts situated in Harris County, Texas, and agree that
any litigated dispute will be conducted solely in such courts.

10.      ADDRESSES

         10.1. All payments should be made payable to "Baylor College of
Medicine" and should he sent to the address below:

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         BAYLOR Tax ID # 741613878
         Vice President & Director of Licensing
         BCM Technologies, Inc.
         1709 Dryden Road. Suite 901
         Houston, TX 77030

         10.2 All notices or other communication pursuant to this Agreement
shall be sufficiently made or given on the date of mailing if sent to such
Party by first class mail, postage prepaid, addressed to it at its address below
or as it shall designate by written notice given to the other Party:

         In the case of BAYLOR:                      With a copy to:
         Senior Vice President & General Counsel     Vice President & Director
         Baylor College of Medicine                  of Licensing
         One Baylor Plaza                            BCM Technologies. Inc.
         Houston, TX 77030                           1709 Dryden Road, Suite 901
                                                     Houston, TX 77030
         In the case of GENOMETRIX
         President
         Genometrix, Inc.
         3608 Research Forest Drive
         Suite B7
         The Woodlands, TX 77381

11.      ADDITIONAL PROVISIONS

         11.1 USE OF BAYLOR/MIT/HARC NAME. GENOMETRIX agrees that it shall not
use in any way the names "Baylor College of Medicine," Massachusetts Institute
of Technology" or Houston Advanced Research Center" or any logotypes or symbols
associated with BAYLOR. MIT or HARC or the names of any of the scientists or
other researchers at BAYLOR. MIT or HARC, respectively, without the prior
written consent of BAYLOR, MIT or HARC, as the case may be.

         11.2 REPRESENTATION OF GENOMETRIX. GENOMETRIX represents and warrants
that as a party thereto, it has read and understands (i) the Collaboration
Agreement and all exhibits

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thereto, (ii) all of the rights and obligations of the parties thereto and (iii)
the Letter Agreement and the letters referenced in the "whereas" clauses at the
beginning of this Agreement.

         11.3 INDEMNITY. Each Party shall notify the other of any claim, lawsuit
or other proceeding related to the Subject Technology. SUBJECT TO THE FOLLOWING
SENTENCE, GENOMETRIX AGREES THAT IT WILL DEFEND, INDEMNIFY AND HOLD HARMLESS
BAYLOR, MIT, HARC, AND EACH OF THEIR RESPECTIVE FACULTY MEMBERS, SCIENTISTS,
RESEARCHERS, EMPLOYEES, OFFICERS, TRUSTEES, DIRECTORS, AND AGENTS AND EACH OF
THEM (THE "INDEMNIFIED PARTIES"), FROM AND AGAINST ANY AND ALL CLAIMS, CAUSES OF
ACTION, LAWSUITS OR OTHER PROCEEDINGS FILED OR OTHERWISE INSTITUTED AGAINST ANY
OF THE INDEMNIFIED PARTIES RELATED DIRECTLY OR INDIRECTLY TO OR ARISING OUT OF
THE DESIGN, PROCESS, MANUFACTURE OR USE BY ANY PERSON OR PARTY OF THE SUBJECT
TECHNOLOGY, OR ANY OTHER EMBODIMENT OF THE SUBJECT TECHNOLOGY EVEN THOUGH SUCH
CLAIMS, CAUSES OF ACTION, LAWSUITS OR OTHER PROCEEDINGS AND THE COSTS (INCLUDING
ATTORNEY'S FEES) RELATED THERETO RESULT IN WHOLE OR IN PART FROM THE NEGLIGENCE
OF ANY OF THE INDEMNIFIED PARTIES OR ARE BASED UPON DOCTRINES OF STRICT
LIABILITY. Notwithstanding any provisions herein to the contrary, BAYLOR shall
indemnify GENOMETRIX for any claims for injuries to persons or property damage
which occur on BAYLOR premises or premises under the exclusive control of
BAYLOR. GENOMETRIX will also assume responsibility for all costs and expenses
related to such claims and lawsuits for which it is obligated to indemnify the
Indemnified Parties pursuant to this Paragraph 11.3, including, but not limited
to, the payment of all reasonable attorneys' fees and costs of litigation or
other defense.

         11.4     INSURANCE.

                  (i) GENOMETRIX shall, for so long as GENOMETRIX manufactures,
         uses or sells any Licensed Product(s) in the Research Field, maintain
         in fill force and effect

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                                            CONFIDENTIAL MATERIAL OMITTED AND
                                            FILED SEPARATELY WITH THE SECURITIES
                                            AND EXCHANGE COMMISSION. ASTERISKS
                                            DENOTE SUCH OMISSIONS.

         policies of (i) worker's compensation and/or employers' liability
         insurance within statutory limits and (ii) general liability insurance
         (with Broad Form General Liability endorsement) with limits of not less
         than ********************* per occurrence with an annual aggregate of
         *********************. Such coverage(s) shall be purchased from a
         carrier or carriers deemed acceptable to BAYLOR. Upon request by
         BAYLOR. GENOMETRIX shall provide to BAYLOR copies of said policies of
         insurance.

                  (ii) GENOMETRIX shall, for so long as GENOMETRIX manufactures,
         uses or sells any Licensed Product(s) in the Clinical Field, maintain
         in full force and effect policies of (i) worker's compensation and/or
         employers' liability insurance within statutory limits and (ii) general
         liability insurance (with Broad Form General Liability endorsement)
         with limits of not less than ********************** per occurrence with
         an annual aggregate of *********************** and (iii) products
         liability insurance, with limits of not less than
         ************************ per occurrence with an annual aggregate of
         *********************. Such coverage(s) shall be purchased from a
         carrier or carriers deemed acceptable to BAYLOR and shall name BAYLOR
         as an additional insured. Upon request by BAYLOR, GENOMETRIX shall
         provide to BAYLOR copies of said policies of insurance.

         11.5 BAYLOR'S DISCLAIMERS. Neither BAYLOR, MIT, HARC nor any of their
respective faculty members, researchers, trustees, officers, employees,
directors, or agents assume any responsibility for the manufacture, product
specifications, sale or use of the Subject Technology or the Licensed Products
which are manufactured by or sold by GENOMETRIX.

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         11.6 INDEPENDENT CONTRACTORS. The Parties hereby acknowledge and agree
that each is an independent contractor and that neither Party shall be
considered to be the agent. representative, master or servant of the other Party
for any purpose whatsoever, and that neither Party has any authority to enter
into a contract, to assume any obligation or to give warranties or
representations on behalf of the other Party. Nothing in this relationship shall
be construed to create a relationship of joint venture, partnership, fiduciary
or other similar relationship between the Parties.

         11.7 DISCLAIMER OF WARRANTY. BAYLOR, MIT AND HARC MAKE NO WARRANTIES OR
REPRESENTATIONS EXPRESS OR IMPLIED, INCLUDING, BUT NOT LIMITED TO, WARRANTIES OF
FITNESS OR MERCHANTABILITY, REGARDING OR WITH RESPECT TO THE SUBJECT TECHNOLOGY
OR LICENSED PRODUCTS AND BAYLOR, MIT AND HARC MADE NO WARRANTIES OR
REPRESENTATIONS, EXPRESS OR IMPLIED, OF THE PATENTABILITY OF THE SUBJECT
TECHNOLOGY OR LICENSED PRODUCTS OR OF THE ENFORCEABILITY OF ANY PATENTS ISSUING
THEREUPON, IF ANY, OR THAT THE SUBJECT TECHNOLOGY OR LICENSED PRODUCTS ARE OR
SHALL BE FREE FROM INFRINGEMENT OF ANY PATENT OR OTHER RIGHTS OF THIRD PARTIES.

         11.8 NON-WAIVER. The Parties covenant and agree that if a Party fails
or neglects for any reason to take advantage of any of the terms provided for
the termination of this Agreement or if a Party, having the right to declare
this Agreement terminated, shall fail to do so, any such failure or neglect by
such Party shall not be a waiver or be deemed or be construed to be a waiver of
any cause for the termination of this Agreement subsequently arising, or as a
waiver of any of the terms, covenants or conditions of this Agreement or of the
performance thereof. None of the

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terms, covenants and conditions of this Agreement may be waived by a Party
except by its written consent.

         11.9 REFORMATION. The Parties hereby agree that neither Party intends
to violate any public policy, statutory or common law, rule, regulation, treaty
or decision of any government agency or executive body thereof of any country or
community or association of countries, and that if any word, sentence, paragraph
or clause or combination thereof of this Agreement is found, by a court or
executive body with judicial powers having jurisdiction over this Agreement or
any of the Parties hereto, in a final, unappealable order to be in violation of
any such provision in any country or community or association of countries, such
words. sentences, paragraphs or clauses or combination shall be inoperative in
such country or community or association of countries, and the remainder of this
Agreement shall remain binding upon the Parties hereto.

         11.10 FORCE MAJEURE. No liability hereunder shall result to a Party by
reason of delay in performance caused by force majeure, that is circumstances
beyond the reasonable control of the Party, including, without limitation, acts
of God, fire, flood, war, civil unrest, labor unrest, or shortage of or
inability to obtain material or equipment.

         11.11 ENTIRE AGREEMENT. The terms and conditions herein constitute the
entire agreement between the Parties and shall supersede all previous
agreements, either oral or written, between the Parties hereto with respect to
the subject matter hereof. No agreement of understanding bearing on this
Agreement shall be binding upon either Party hereto unless it shall be in
writing and signed by the duly authorized officer or representative of each of
the Parties and shall expressly refer to this Agreement.

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         IN WITNESS WHEREOF, the Parties hereto have executed and delivered this
Agreement in multiple originals be their duly authorized officers and
representatives on the respective dates shown below, but effective as of the
Agreement Date.

GENOMETRIX, INC.                            BAYLOR COLLEGE OF MEDICINE

Name: /s/Mitchell D. Eggers                 Name: /s/W. Dalton Tomlin
      ---------------------------                 ------------------------------

Title: President & CEO                      Title: Senior Vice President &
                                                    General Counsel

Date: 7/20/98                               Date: 6/1/98

                                       16<PAGE>   1
EXHIBIT 10.6                               CONFIDENTIAL TREATMENT
                                   GENOMETRIX INCORPORATED HAS REQUESTED
                                   THAT THE MARKED PORTIONS OF THIS DOCUMENT
                                   BE ACCORDED CONFIDENTIAL TREATMENT PURSUANT
                                   TO RULE 406 UNDER THE SECURITIES ACT OF 1933,
                                   AS AMENDED

                                LICENSE AGREEMENT

                                     BETWEEN

                                XENOMETRIX, INC.

                                       AND

                             GENOMETRIX INCORPORATED

                                 AUGUST 27,1999

<PAGE>   2

                                LICENSE AGREEMENT

         This License Agreement (the "Agreement") is made this 27th day of
August, 1999 (the "Effective Date"), by and between Xenometrix, Inc., a Delaware
corporation with principal offices at 2425 North 55th Street, Suite 111,
Boulder, CO 80301-5700 ("XENO") and Genometrix Incorporated, a Delaware
corporation with principal offices at 3608 Research Forest Drive, Suite B7, The
Woodlands, Texas, 77381 ("GENOMETRIX").

                                    RECITALS

         WHEREAS, XENO is the joint owner of and the exclusive licensee of the
XENO Patents (as hereinafter defined), and desires to non-exclusively license
the same to GENOMETRIX; and

         WHEREAS, GENOMETRIX seeks to obtain certain non-exclusive rights and
licenses under the XENO Patents, according to the terms contained herein.

         NOW THEREFORE, in consideration of the foregoing and the covenants and
promises contained herein, the parties agree as follows:

1.       DEFINITIONS

         1.1. "AFFILIATE" means any corporation or other business entity
controlling, controlled by, or in common control with the designated party.
Control, as used in the context of a business entity, means the ownership
directly or indirectly of greater than fifty percent (50%) of the voting
securities of the corporation or other entity, or greater than a fifty percent
(50%) interest in the income of such corporation or other entity, or the ability
otherwise to secure that the affairs of such corporation or other entity are
managed in accordance with the such entity's wishes.

         1.2. "CHIP" means a microarray of biological probes designed to carry
out or enable genomic sequencing, mutation detection, assays, syntheses,
reactions, analyses or sample preparation. The term "Chip" also includes
assemblies of multiple Chips that are interconnected in close physical proximity
to each other. Chips may incorporate other electrical, electronic,
electromechanical and mechanical components when said components are an integral
part of the Chip.

         1.3. "CONFIDENTIAL INFORMATION" means all information, compounds, data,
know-how, trade secrets, technical data, specifications, testing methods,
protocols, standard operating procedures, product and marketing plans' customer
and supplier information, and Materials disclosed by one party (the "Disclosing
Party") to the other party (the "Receiving Party") pursuant to this Agreement
and specifically designated as confidential, regardless of whether such
information is in written, oral, electronic, or other form; provided, that,
Confidential Information that is disclosed orally or visually shall be
documented in a written notice to the Receiving Party within fifteen (15) days
of the date of disclosure.

<PAGE>   3

                                            CONFIDENTIAL MATERIAL OMITTED AND
                                            FILED SEPARATELY WITH THE SECURITIES
                                            AND EXCHANGE COMMISSION. ASTERISKS
                                            DENOTE SUCH OMISSIONS.

         1.4. "FIELD" means *** ****** ** ***, including without limitation
********* *******, **********, **** ********** ********* and ******* *********
*********, and the *************** ** ************ ** **** ************ ***
******* *********** **********.

         1.5. "HARVARD" means the President and Fellows of Harvard College, a
nonprofit Massachusetts educational corporation having offices at the Office for
Technology and Trademark Licensing, Holyoke Center, Suite 727, 1350
Massachusetts Avenue, Cambridge, Massachusetts 02138.

         1.6. "HARVARD LICENSE AGREEMENT" means the license agreement between
the President and Fellows of Harvard College and Venmark Ltd., having an
effective date of January 18, 1992, and any amendments thereto. A true and
accurate copy of the Harvard License Agreement and the amendment thereto dated
January 18, 1992 and having an effective date of January 21, 1993, is attached
hereto as EXHIBIT B.

         1.7. "LICENSED PRODUCT(S)" means a Chip where (i) the Chip or a
functional component thereof is claimed in the XENO Patents or (ii) the Chip is
manufactured or used in accordance with or by means of the Licensed Process, or
(iii) the Chip makes use of the technology claimed in the XENO Patents in its
manufacture, testing, use or sale.

         1.8. "LICENSE PROCESS(ES)" means the process(es) claimed in XENO
Patents.

         1.9. "LICENSED SERVICE(S)" means services performed on a commercial
basis for third parties or components thereof utilizing Licensed Product(s) or
Licensed Process(es) as defined herein.

         1.10. "NET SALES" means the amounts received in consideration for the
sale, transfer or use of Licensed Products covered by a Valid Claim less the sum
of the following actual and customary deductions: (i) customary trade, quantity
or cash discounts and non-affiliated brokers' or agents' commissions actually
allowed and taken; (ii) amounts repaid or credited by reason of rejection or
return; and (iii) any tax (including sales and use taxes) or government charges
(other than an income tax) levied on the sale, transportation or delivery of a
Licensed Product; (iv) import or export duties and/or taxes; and (v)
transportation charges, including any prepaid or invoiced charges for freight,
postage, shipping, insurance or charges for returnable containers.

         In the event that Licensed Products are sold, used or provided in
combination with other products, components or processes, or in the event a
Licensed Product is one component among a combination of functional elements,
then Net Sales, for purposes of determining royalty payments on the combination,
shall be calculated using one of the following methods:

                  (i) By multiplying the Net Sales of the combination product or
         process by the fraction A/A+B, where A is the gross selling price,
         during the royalty period in question, of the Licensed Product sold
         separately, and B is the aggregate gross selling price, during the
         royalty period in question, of all other products, components,
         processes or elements when sold separately; or

                                       2
<PAGE>   4

                  (ii) In the event that no such separate sales are made of the
         Licensed Product or such other products, components, elements or
         processes in such combination during the royalty period in question,
         Net Sales, for the purposes of determining royalty payments, shall be
         calculated using the above formula where A is the reasonably estimated
         commercial value of the Licensed Product when sold separately, and B is
         the reasonably estimated aggregate commercial value of all other
         products, processes, components or elements when sold separately. Any
         such estimates shall be determined using criteria to be mutually agreed
         upon by the parties.

         1.11. "SERVICE INCOME" means (A) the total number of distinct Chips
which are (i) Licensed Products, and (ii) which are covered by a Valid Claim of
the XENO Patents, and (iii) which are used by GENOMETRIX to provide a Licensed
Service to a Third Party, multiplied by (B) the Net Sales that would be
attributable to the sale of each such Chip pursuant to Section 1.10. above if,
such Chip had been sold to such Third Party during the period in question.

         1.12. "TERM" has the meaning set forth in Section 6.1.1.

         1.13. "THIRD PARTY" means any entity other than (i) GENOMETRIX and any
of its Affiliates, and (ii) XENO and any of its Affiliates.

         1.14. "VALID CLAIM" means (i) a pending claim of a patent application
comprising the XENO Patents, which (A) has been asserted in good faith and can
be reasonably considered to be patentable in view of any and all references and
prior art known to the parties at any time, (B) has not been abandoned or
finally rejected without the possibility of appeal or refiling, and (C) has been
pending for less than seven (7) years from the applicable priority date; or (ii)
a claim of an issued or granted and unexpired patent comprising the XENO
Patents, which has not been held unenforceable, unpatentable or invalid by a
decision of a court or governmental body of competent jurisdiction, unappealable
or unappealed within the time allowed for appeal, which has not been rendered
unenforceable through disclaimer or otherwise, which has not been abandoned, or
which has not been lost through an interference proceeding.

         1.15. "XENO PATENTS" means the patents and patent applications listed
on EXHIBIT A hereto, any patent applications filed prior or subsequent to the
Effective Date that claim the benefit of an early filing date to any of the
patent applications listed in EXHIBIT A, and any improvements, reissues,
extensions, substitutions, confirmations, re-registrations, reexaminations,
continuations, divisionals or continuations-in-part of the foregoing patents and
patent applications, as well as all foreign counterparts, or equivalents
thereof.

2.       LICENSES

         2.1. GRANT OF LICENSES UNDER THE XENO PATENTS FROM XENO TO GENOMETRIX

                  2.1.1. Non-Exclusive License Under XENO's Interest in the XENO
Patents. XENO hereby grants to GENOMETRIX and its Affiliates a non-exclusive,
worldwide license in the Field under XENO's ownership interest in the XENO
Patents, to make, use, sell, offer for

                                       3
<PAGE>   5

                                            CONFIDENTIAL MATERIAL OMITTED AND
                                            FILED SEPARATELY WITH THE SECURITIES
                                            AND EXCHANGE COMMISSION. ASTERISKS
                                            DENOTE SUCH OMISSIONS.

sale, import, and export, or otherwise exploit any process, composition of
matter or other invention claimed in the XENO Patents. Such right shall include,
without limitation, the right to make, use, sell, offer for sale, import, and
export Licensed Products and Licensed Services.

                  2.1.2. Non-Exclusive Sublicense to XENO Patents Under the
Harvard License Agreement. XENO hereby grants to GENOMETRIX and its Affiliates a
non-exclusive, worldwide sublicense in the Field under XENO's license to
Harvard's interest in the XENO Patents pursuant to the Harvard License
Agreement, to make, use, sell, offer for sale, import, and export, or otherwise
exploit any process, composition of matter or other invention claimed in the
XENO Patents. Such license shall include, without limitation, the right to make,
use, sell, offer for sale, import, and export Licensed Products and Licensed
Services. GENOMETRIX acknowledges the Harvard License Agreement and obligations
imposed by Section 2.2(e) thereof; provided that, the obligation of Section
2.2(e) of the Harvard License Agreement shall not be construed to affect
GENOMETRIX's right to freely determine pricing for Licensed Products and
Licensed Services hereunder. GENOMETRIX agrees that any Licensed Products or
Licensed Services produced for sale or use in the United States will be
manufactured substantially in the United States.

         2.2. RIGHT TO GRANT SUBLICENSES. The rights and licenses granted to
GENOMETRIX pursuant to Section 2.1. above, ***** ******* *** ***** ** GENOMETRIX
and its Affiliates ** ***** *********** ** ***** ********** *********, *******,
************ and ************** ** ******** ******** ****** ******** ********
****** *** *** **** ********** ****** ** ********** ** **********.

         2.3.     RETAINED RIGHTS; RIGHTS OF UNITED STATES GOVERNMENT.

                  2.3.1. GENOMIETRIX recognizes that, pursuant to Section 2.2(b)
of the Harvard License Agreement, Harvard has retained certain rights to make
and to use, for its own research purposes only and not for any commercial
purpose, the subject matter described and claimed in the XENO Patents.

                  2.3.2. GENOMETRIX recognizes that the rights granted to it
under the XENO Patents which are owned jointly by XENO and Harvard and which are
the subject of the Harvard License Agreement are subject to the rights of the
United States Government as set forth in Public Laws 96-517 and 98-620.

3.       COMPENSATION

         3.1. COMPENSATION FOR THE XENO PATENTS LICENSE. As consideration for
the licenses and rights granted to GENOMETRIX herein, GENOMETRIX shall pay to
XENO:

                  3.1.1. A non-refundable, up-front license issue fee of
*************** , less the Option Fee of **************** paid by GENOMETRIX
prior to the Effective Date pursuant to the Option Agreement dated May 27, 1999,
leaving an outstanding balance of

                                       4
<PAGE>   6

                                            CONFIDENTIAL MATERIAL OMITTED AND
                                            FILED SEPARATELY WITH THE SECURITIES
                                            AND EXCHANGE COMMISSION. ASTERISKS
                                            DENOTE SUCH OMISSIONS.

****************** payable by GENOMETRIX as follows: (i) ************** upon
execution of this Agreement, and (ii) **************** within three (3) months
of the Effective Date of this Agreement.

                  3.1.2. With respect to Licensed Products only (and not
Licensed Services), a royalty of ************ of the Net Sales of Licensed
Products covered by a Valid Claim of the XENO Patents and sold by GENOMETRIX,
its Affiliates or sublicensees.

                  3.1.3. With respect to Licensed Services only (and not
Licensed Products), a royalty of ************ of Service Income covered by a
Valid Claim of the XENO Patents and received by GENOMETRIX, its Affiliates or
sublicensees.

                  3.1.4. For the avoidance of doubt, the royalty payments
outlined in Sections 3.1.2. and 3.1.3. are intended to be mutually exclusive.
Only one royalty payment for each specific sale of a Licensed Product or the
provision of a Licensed Service shall be payable to XENO, regardless of the
number of Valid Claims of the XENO Patents covering the manufacture, use or sale
of the applicable Licensed Product or the provision of the Licensed Service.

                  3.1.5. The royalties set forth in Sections 3.1.2. and 3.1.3.
shall be paid to XENO within sixty (60) days after the end of each calendar
quarter.

                  3.1.6. If, in the reasonable judgment of GENOMETRIX, it should
prove impractical or impossible for GENOMETRIX or any of its Affiliates or
sublicensees to develop, make, use, sell or import a Licensed Product or provide
a Licensed Service without first obtaining a royalty-bearing license from a
Third Party under one or more pending patent applications or issued patents
owned or controlled by such Third Party in any country, then, effective upon
obtaining a license from such Third Party, GENOMETRIX shall be entitled to a
credit against the payments due hereunder of an amount equal to ************ of
the royalty paid to any such Third Party by GENOMETRIX, its Affiliates or
sublicensees in such country, not to exceed ********** of the royalty payment
otherwise due under this Agreement, arising from the development, manufacture,
use, sale or import of the Licensed Product or Licensed Service covered by such
Third Party patent or patent application in such country. If such *************
of the Third Party royalty owed by GENOMETRIX's exceeds the amount of royalties
deducted by GENOMETRIX for any calendar year, GENOMETRIX may to that extent
reduce the royalties due to XENO in succeeding calendar years, but never by more
than ********* of the total royalty due in any one year until such Third Party
royalties have been fully carried forward and credited to GENOMETRIX.

                  3.1.7. GENOMETRIX shall not be obligated to make any further
royalty payments in a country for any Licensed Product or Licensed Service after
the end-of the period commencing on the date of the first commercial transaction
of the Licensed Product or provision of Licensed Service in that country by
GENOMETRIX, its Affiliates or sublicensees and ending

                                       5
<PAGE>   7

on the expiration of the last to expire Valid Claim covering the Licensed
Product or Licensed Service in that country.

4.       REPRESENTATIONS AND WARRANTIES

         4.1. REPRESENTATIONS AND WARRANTIES OF GENOMETRIX AND XENO. Each party
hereby represents and warrants:

                  4.1.1. Corporate Power. Such party is duly organized and
validly existing and in good standing under the laws of the state and/or country
of its incorporation and has all requisite corporate power and authority to
enter into this Agreement and to carry out the provisions hereof.

                  4.1.2. Due Authorization. Such party is duly authorized to
execute and deliver this Agreement and to perform its obligations hereunder.

                  4.1.3. Binding Agreement. This Agreement is a legal and valid
obligation binding upon it and enforceable in accordance with its terms. The
execution, delivery and performance of this Agreement by such party does not
conflict with any agreement, instrument or understanding, oral or written, to
which it is a party or by which it may be bound, nor violate any law or
regulation of any court, governmental body or administrative or other agency
having jurisdiction over it.

         4.2. NEGATION OF WARRANTIES. Except as expressly set forth in this
Agreement, XENO MAKES NO REPRESENTATIONS AND EXTENDS NO WARRANTIES OF ANY KIND,
EITHER EXPRESS OR IMPLIED. THERE ARE NO EXPRESS OR IMPLIED WARRANTIES OF
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE, OR THAT THE USE OF THE
LICENSED PRODUCTS OR THE PROVISION OF LICENSED SERVICES WILL NOT INFRINGE ANY
PATENT, COPYRIGHT, TRADEMARK, OR, OTHER INTELLECTUAL PROPERTY RIGHT OF ANY THIRD
PARTY. HOWEVER, XENO HAS NO REASON TO BELIEVE THAT THE XENO PATENTS ARE INVALID
OR THAT EXPLOITATION OF THE XENO PATENTS BY GENOMETRIX, ITS AFFILIATES OR
SUBLICENSEES WILL INFRINGE THE PATENT OR OTHER INTELLECTUAL PROPERTY RIGHTS OF
XENO, HARVARD OR ANY THIRD PARTY.

         4.3. HARVARD LICENSE AGREEMENT. XENO represents and warrants that the
Harvard License Agreement has not, as of the Effective Date, been terminated by
either XENO or the President and Fellows of Harvard College and that XENO has
not, as of the Effective Date, received nor given notice of termination for
breach of the Harvard License Agreement, and neither XENO nor Harvard is in
default or breach of the Harvard License Agreement. XENO represents and warrants
that it will use its best efforts to maintain the Harvard License Agreement and
the exclusive licenses granted to XENO therein in full force and effect, which
shall include, without limitation, (a) complying with its obligations to pay the
royalties and other amounts owed Harvard pursuant to the Harvard License
Agreement, and complying with all due diligence and commercialization
obligations and milestones set forth in the Harvard License Agreement, (b)
refraining from entering into any modification or amendment to the Harvard
License Agreement that would in any way affect the rights under the XENO Patents
granted to

                                       6
<PAGE>   8

GENOMETRIX hereunder, and (c) taking no action or making no omission which will
cause Harvard to have the right to terminate the Harvard License Agreement
pursuant to its terms or rendering the exclusive licenses granted thereunder
non-exclusive, and (d) taking any action to terminate the Harvard License
Agreement. XENO agrees to notify GENOMETRIX of any written or oral notification
by Harvard that XENO has breached the Harvard License Agreement or that Harvard
wishes to terminate the Harvard License Agreement or render the exclusive
licenses granted thereunder non-exclusive. XENO represents and warrants that it
has the right under the Harvard License Agreement to grant to GENOMETRIX the
rights and licenses granted herein. XENO represents and warrants that, should
the Harvard License Agreement be terminated or rendered non-exclusive by
Harvard, (i) the rights and licenses granted to GENOMETRIX under XENO's interest
in the XENO Patents shall remain in full force and effect, and (ii) as set forth
in EXHIBIT C hereof, GENOMETRIX shall continue to have a non-exclusive,
worldwide, royalty bearing (as set forth in this Agreement) license under XENO's
interest in the XENO Patents.

         4.4. ENFORCEMENT OF THE XENO PATENTS. GENOMETRIX and XENO each agree to
notify the other promptly of any infringement of the XENO Patents of which it
becomes aware. XENO shall have the right, but not the obligation, to bring an
enforcement action against any Third Party infringer of the XENO Patents in the
FIELD; provided, that, if XENO does bring such action, GENOMETRIX at its option
may elect to join in any such action at GENOMETRIX's expense, and the parties
shall agree on a reasonable allocation of any damages recovered pursuant to such
action. If XENO fails to bring any such enforcement action against any such
alleged infringer within ninety (90) days of notification of such alleged
infringement, (pursuant in this Section 4.4) GENOMETRIX shall have the right,
but not the obligation, to bring such action, and in such case, XENO shall
provide GENOMETRIX with all reasonable assistance or technical support
reasonably requested by GENOMETRIX, including, without limitation and only to
the extent it has the right to do so pursuant to the Harvard License Agreement,
causing Harvard to provide assistance in such action. XENO agrees that it shall
not sublicense any alleged infringer of the XENO Patents in the Field, without
the prior written consent of GENOMETRIX, if the alleged infringer is in active
settlement discussions, and/or active litigation with GENOMETRIX regarding
infringement of the XENO Patents, such consent not to be unreasonably withheld.
In the event that an action is brought against GENOMETRIX by a Third Party
alleging infringement of such Third Party's patent rights, XENO shall provide
GENOMETRIX, at GENOMETRIX's expense, with all reasonable assistance or technical
support reasonably requested by GENOMETRIX, including, without limitation and
only to the extent it has the right to do so pursuant to the Harvard License
Agreement, causing Harvard to provide assistance in such action.

5.       CONFIDENTIALITY

         5.1. CONFIDENTIAL INFORMATION. Except as otherwise expressly provided
herein, the parties agree that, during the Term and for a period of five (5)
years thereafter, the Receiving Party shall keep completely confidential and
shall not publish or otherwise disclose to any Third Party, and shall not use
for any purpose other than (i) to perform the purposes contemplated by this
Agreement and to exercise the rights and licenses granted hereunder, and (ii)
where

                                       7
<PAGE>   9

reasonably necessary, for the filing or prosecution of patent applications
comprising the XENO Patents, and to prosecute alleged infringers or the XENO
Patents or to defend the XENO Patents.

         The foregoing obligations shall not apply to Confidential Information
that the Receiving Party can demonstrate by written records:

                  (a) was in the public domain prior to the time of its
         disclosure under this Agreement;

                  (b) entered the public domain after the time of its disclosure
         under this Agreement through means other than an unauthorized
         disclosure resulting from an act or omission of the Receiving Party,
         its directors, officers or employees;

                  (c) was independently developed or discovered by the Receiving
         Party prior to the time of its disclosure under this Agreement;

                  (d) is or was disclosed to the Receiving Party at any time,
         whether prior to or after the time of its disclosure under this
         Agreement, by a Third Party who had no fiduciary relationship with the
         Disclosing Party and had no obligation of confidentiality with respect
         to such Confidential Information; or

                  (e) is required to be disclosed to comply with applicable laws
         or regulations, or with a court or administrative order, provided that,
         the Receiving Party notifies the Disclosing Party promptly upon receipt
         of such court or administrative order and/or prior to any disclosure,
         thereby giving the Disclosing Party sufficient advance notice to permit
         the Disclosing Party to seek a protective order or other similar order
         with respect to such Confidential Information; and provided further,
         that the Receiving Party shall take all reasonable and lawful actions
         to obtain confidential treatment for such disclosure and to minimize
         the extent of the disclosure, and that the Receiving Party furnishes
         only that portion of the Confidential Information which it is advised
         by its legal counsel is legally required to be disclosed, regardless of
         whether a protective order or other similar order is obtained by the
         Disclosing Party.

         5.2. CONFIDENTIAL TERMS. The terms and conditions of this Agreement,
including without limitation the financial terms, shall be considered
Confidential Information hereunder, and shall be treated in accordance with the
provisions of this Article 5. The foregoing notwithstanding, the parties
recognize and agree that, pursuant to Section 2.2(e) of the Harvard License
Agreement, XENO is obligated to provide Harvard with a copy of this Agreement,
and XENO agrees that in fulfilling such obligation XENO shall notify Harvard in
writing that this Agreement shall be treated by Harvard as Proprietary
Information pursuant to Section 4.4(a) of the Harvard License Agreement

         5.3. PRESS RELEASE. The provisions of Sections 5.1. and 5.2.
notwithstanding, the parties shall agree upon a press release to announce the
execution of this Agreement Thereafter, XENO and GENOMETRIX may each disclose to
Third Parties the information contained in such press release without the need
for further approval by the other.

                                       8
<PAGE>   10

6.       TERMINATION

         6.1.     TERMINATION OF AGREEMENT.

                  6.1.1. Unless earlier terminated, this Agreement shall remain
in full force and effect until the expiration or disallowance of the last claim
of a patent or patent application comprising the XENO Patents (hereinafter the
"Term").

                  6.1.2. Either party shall have the right to terminate this
Agreement for a material breach of this Agreement by the other party by
providing the breaching party with written notification of the nature of the
default and requiring it to cure the default. If such default is not cured
within thirty (30) days after receipt of such notice (or, if such default cannot
be cured or remedied within such thirty (30) day period, if the party in default
does not commence and diligently continue actions to cure or remedy the
default), the non-breaching party shall be entitled, without prejudice to any of
its other rights under this Agreement, to terminate this Agreement by giving
written notice to take effect within thirty (30) days after such notice, unless
the breaching party shall cure such default within such thirty (30) day period.
The right of either party to terminate this Agreement pursuant to this Section
6.1.2. shall not be affected in any way by its waiver or failure to take action
with respect to any previous default, subject to applicable statutes of
limitation.

                  6.1.3. GENOMETRIX may terminate this Agreement without cause
at any time by providing written notice thereof to XENO and such termination
will be. effective ninety (90) days thereafter.

                  6.1.4. If (i) GENOMETRIX loses the rights under XENO's
interest in the XENO Patents granted to it pursuant to this Agreement as a
result of the bankruptcy or insolvency of XENO, or (ii) if XENO makes an
assignment for the benefit of creditors, appoints or suffers appointment of a
receiver or trustee or files a petition under any bankruptcy or insolvency act
or has any such petition filed against it, and such action causes GENOMETRIX to
lose the rights under XENO's interest in the XENO Patents granted to it under
this Agreement, then Harvard has agreed (as set forth in EXHIBIT C hereof), to
the extent it is legally able to do so, to negotiate with GENOMETRIX in good
faith regarding the grant to GENOMETRIX of a non-exclusive license under
Harvard's interest in the XENO Patents, such license to have commercially
reasonable terms; provided, that, the terms (including the applicable royalty
rate) shall be at least as favorable to GENOMETRIX as the terms (including the
applicable royalty rate) of this Agreement.

                  6.1.5. Upon any termination of this Agreement, all sublicenses
granted by GENOMETRIX under this Agreement shall terminate, unless any
sublicensee shall agree in writing thereto to be bound directly to XENO by the
provisions of the relevant sublicense agreement, in which event such sublicense
shall survive. The foregoing not withstanding, any sublicense granted to
customers or clients of GENOMETRIX shall survive only to the extent necessary to
permit such sublicensees to continue in its use of Licensed Product(s) sold to
it or Licensed Service(s) provided to it pursuant to this Agreement prior to the
effective date of termination.

                                       9
<PAGE>   11

                  6.1.6. The following Articles and Sections shall survive the
expiration or early termination of this Agreement: Articles 5 and 7, and
Sections 3.1.7., 4.2., 4.3., 6.1.4., 6.1.5., this Section 6.1.6., and Section
6.1.7.

                  6.1.7. Any termination, relinquishment or expiration of this
Agreement for any reason shall be without prejudice to any rights, which shall
have accrued, to the benefit of either party under this Agreement prior to such
termination, relinquishment or expiration. Such termination, relinquishment or
expiration shall not relieve either party from obligations, which are expressly
indicated to survive termination or expiration of this Agreement.

7.       MISCELLANEOUS

         7.1. BINDING EFFECT; ASSIGNMENT. This Agreement shall be binding upon
the parties' respective successors and permitted assigns. Neither party may
assign this Agreement or any of its rights or obligations hereunder without the
prior written consent of the other party (not to be unreasonably withheld), and
any such attempted assignment shall be void; provided, that, XENO or GENOMETRIX,
respectively, may assign this Agreement to a successor to the business interest
of such party relating to the XENO Patents; provided, that, such assignee agrees
to assume all of the obligations of the assigning party hereunder.

         7.2. EFFECT OF WAIVER. No waiver of any default, condition, provisions
or breach of this Agreement shall be deemed to imply or constitute a waiver of
any other like default, condition, provision or breach of this Agreement.

         7.3. LIMITATION OF LIABILITY. EXCEPT AS OTHERWISE PROVIDED HEREIN,
NEITHER PARTY SHALL BE LIABLE TO THE OTHER FOR ANY SPECIAL, CONSEQUENTIAL,
INCIDENTAL, OR INDIRECT DAMAGES ARISING OUT OF THIS LICENSE AGREEMENT, HOWEVER
CAUSED, UNDER ANY THEORY OF LIABILITY.

         7.4. INDEMNIFICATION. GENOMETRIX will defend, indemnify and hold XENO,
its officers, directors, employees, Affiliates and agents harmless against any
and all liability, loss, damage, claim or expense (including attorney's fees)
arising out of a suit by a Third Party from the performance under this Agreement
by GENOMETRIX; except to the extent such claim is caused by the negligence or
willful misconduct of XENO or a breach of a representation of XENO. XENO will
defend, indemnify and hold GENOMETRIX, its officers, directors, employees,
Affiliates and agents harmless against any and all liability, loss, damage,
claim or expense (including attorney's fees) arising out of a suit by a Third
Party from the performance under this Agreement by XENO; except to the extent
such claim is caused by the negligence or willful misconduct of GENOMETRIX or a
breach of a representation of GENOMETRIX.

         7.5. PRODUCT LIABILITY INSURANCE; INDEMNITY. GENOMIETRIX agrees that,
to the extent it has insurance coverage therefore, it shall indemnify, defend
and hold XENO harmless from any claim, demand or action by any Third Party
arising out of or relating to the sale by GENOMIETRIX hereunder of products
licensed in the Field herein by XENO, services

                                       10
<PAGE>   12

performed by GENOMETRIX in the Field, or the performance of any activity as
GENOMETRIX under this Agreement, except to the extent such claim, demand or
action resulted from the negligence of misconduct of XENO.

         7.6. FORCE MAJEURE. Neither party shall lose any rights hereunder or be
liable to the other party for damages or losses (except for payment obligations)
on account of failure of performance by the defaulting party if the failure is
occasioned by war, strike, fire, act of God, earthquake, flood, lockout,
embargo, governmental acts or orders or restrictions, failure of suppliers, or
any other reason where failure to perform is beyond the reasonable control and
not caused by the negligence or intentional conduct or misconduct of the
nonperforming party, and such party has exerted all reasonable efforts to avoid
or remedy such force majeure; provided however, that in no event shall a party
be required to settle any labor dispute or disturbance.

         7.7. AMENDMENT. No modification, supplement to or waiver of this
Agreement or any Addendum hereto or any of their provisions shall be binding
upon a party hereto unless made in writing and duly signed by an authorized
representative of both XENO and GENOMETRIX. In no event may the terms of this
Agreement be changed, deleted, supplemented or waived by any notice, purchase
order; receipt, acceptance, bill of lading or other similar form of document. A
failure of either party to exercise any right or remedy hereunder, in whole or
in part, or on one or more occasions, shall not be deemed either a waiver of
such right or remedy to the extent not exercised, or of any other right or
remedy, on such occasion or a waiver of any right or remedy on any succeeding
occasion.

         7.8. ENTIRE AGREEMENT. This Agreement, together with EXHIBIT A, EXHIBIT
B and Exhibit C attached hereto, sets forth the entire understanding and
agreement of the parties as to the subject matter thereof, and there are no
other understandings, representations or promises, written or verbal, not set
forth herein or on which either party has relied.

         7.9. NOTICES. All Notices under this Agreement shall be given in
writing and shall be addressed to the parties at the following addresses:

                  FOR XENO:

                           Pauline Gee, Ph.D.
                           President and Chief Scientific Officer
                           Xenometrix, Inc.
                           2425 North 55th Street, Suite 111
                           Boulder, Colorado 80301-5700

                  FOR GENOMETRIX:

                           Mitchell D. Eggers, Ph.D.
                           Chief Executive Officer
                           Genometrix Incorporated
                           3608 Research Forest Drive, Suite B7
                           The Woodlands, TX 77381

                                       11
<PAGE>   13

         Notices shall be in writing and shall be deemed delivered when
received, if delivered by a courier, overnight mail service or the like, or a
week following mailing, if sent by first-class certified or registered mail,
postage prepaid.

         7.10     ARBITRATION.

                  7.10.1. In the event of any controversy or claim arising out
of or relating to any provision of this Agreement or the breach thereof,
including any dispute relating to patent validity or infringement (hereinafter a
"Dispute"), the parties shall try to settle such disputes amicably between
themselves, and it is the objective of the parties to establish procedures to
facilitate the resolution of disputes arising under this Agreement in an
expedient manner by mutual cooperation and without resort to arbitration.
Promptly after the identification of a Dispute, the party raising the Dispute
shall promptly advise the other party thereof in writing, which writing shall
describe the nature of the Dispute in reasonable detail. The parties shall
thereafter attempt to resolve the Dispute by good faith negotiations between
XENO's President and GENOMETRIX's Chief Executive Officer within thirty (30)
days after such notice is received. If the Dispute is not resolved within such
thirty (30) day period (or any mutually agreed extension), or if the parties
fail to meet within such thirty (30) days, the Dispute shall be submitted to
binding arbitration as provided in Section 7.10.2. below.

                  7.10.2. Any Dispute which the parties are unable to resolve
pursuant to Section 7.10.1. shall be settled through binding arbitration
conducted in accordance with the Commercial Arbitration Rules of the American
Arbitration Association (the "Association"). The demand for arbitration shall be
filed within a reasonable time after the Dispute has arisen, and in no event
after the date upon which institution of legal proceedings based on such Dispute
would be barred by the applicable statute of limitations. Unless other wise
agreed by the parties, such arbitration shall be held in Santa Fe, New Mexico.
The arbitration shall be conducted before three (3) arbitrators chosen according
to the following procedure: each of the parties shall appoint one arbitrator,
and the two so nominated shall choose the third. If the arbitrators chosen by
the parties cannot agree on the choice of the third arbitrator within twenty
(20) days of their appointment, then the selection shall be made by the
Association pursuant to its rules; provided, that, under no circumstances shall
the third arbitrator be an employee, director, or shareholder of either party or
any of its Affiliates. Unless otherwise agreed by the parties, the arbitration
proceedings will be conducted in the utmost secrecy; in such case, all
documents, testimony and records shall be received, heard and maintained by the
arbitrators in secrecy under seal, available for the inspection only of the
parties and their respective attorneys and their respective experts who shall
agree in advance and in writing to receive all such information confidentially
and to maintain such information in secrecy until such information shall become
generally known. The decision reached by the arbitrators shall be conclusive and
binding upon the parties hereto and may be filed with the clerk of any court of
competent jurisdiction, and a judgment confirming such decision may, if desired
by any party to the arbitration, be entered in such court. Each of the parties
shall pay its own expenses of arbitration and the expenses of the arbitrator(s)
shall be equally shared; provided, however, that if in the opinion of the
arbitrator(s) any claim hereunder or any defense or objection thereto was
unreasonable, the arbitrator(s) may assess, as part of the award, all or any
part of the arbitration expenses (including reasonable attorneys' fees) against

                                       12
<PAGE>   14

the party raising such unreasonable claim, defense or objection. Nothing herein
set forth shall prevent the parties from settling any Dispute by mutual
agreement at any time.

         7.11. GOVERNING LAW. This Agreement shall be governed by and construed
in accordance with the laws of the State of Delaware, without regard or giving
effect to its principles of conflict of laws.

         7.12. SEVERABILITY AND SURVIVAL. This Agreement is intended to be
severable. If any provision(s) of this Agreement are or become invalid, are
ruled illegal by a court of competent jurisdiction or are deemed unenforceable
under the current applicable law from time to time in effect during the term
hereof, it is the intention of the parties that the remainder of this Agreement
shall not be affected thereby and shall continue to be construed to the maximum
extent permitted by law at such time. It is further the intention of the parties
that in lieu of each such provision which is invalid, illegal, or unenforceable,
there shall be substituted or added as part of this Agreement by such court of
competent jurisdiction a provision which shall be as similar as possible, in
economic and business objectives as intended by the parties to such invalid,
illegal or unenforceable provision, but shall be valid, legal and enforceable.
Unless expressly stated otherwise, any provision intended by its meaning to
survive, will survive the expiration or any other termination of this Agreement.

         7.13. INDEPENDENT CONTRACTORS. The parties hereto are acting as
independent contractors and shall not be considered partners, joint venturers or
agents of the other. Neither shall have the right to act on behalf of, or to
bind, the other.

         7.14. HEADINGS. Captions and paragraph headings are for convenience
only and shall not form an interpretative part of this Agreement. Unless
otherwise specifically provided herein, all references to an Article incorporate
all Articles or subsections thereunder. This Agreement shall not be strictly
construed against either party hereto and maybe executed in two or more
counterparts, each of which will be deemed an original and the same instrument.

         7.15. ACTIONS OF PARTIES. Each party agrees to execute, acknowledge and
deliver such further instructions, and to do all such other acts, as may be
necessary or appropriate in order to carry out the purposes and intent of this
Agreement.

         7.16. COUNTERPARTS. This Agreement may be executed in a series of
counterparts, all of which when taken together, shall constitute one and the
same instrument.

         7.17. RIGHTS IN BANKRUPTCY. All rights and licenses granted under or
pursuant to this Agreement are, and shall otherwise be deemed to be, for
purposes of Section 365(n) of the U.S. Bankruptcy Code, licenses of rights to
"intellectual property" as defined under Section 101 of the U.S. Bankruptcy
Code. The Parties agree that GENOMETRIX shall retain and may fully exercise all
of its rights and elections under the U.S. Bankruptcy Code.

                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK.]

                                       13
<PAGE>   15

         IN WITNESS WHEREOF, the parties have executed this Agreement as of the
Effective Date.

XENOMETRIX, INC.

By: /s/Pauline Gee
   ------------------------------------------
       Pauline Gee, Ph.D.
       President and Chief Scientific Officer

GENOMETRIX INCORPORATED

By: /s/Mitchell D. Eggers
   ------------------------------------------
       Mitchell D. Eggers Ph.D.
       Chief Executive Officer

                                       14
<PAGE>   16

                                    EXHIBIT A
                                 (TO BE UPDATED)

<TABLE>
<CAPTION>
       PATENT/           FILING                             ISSUE
    APPLICATION #         DATE            COUNTRY           DATE                       TITLE

<S>                     <C>             <C>               <C>            <C>
08/008,896              1/21/93         US
5,811,231               7/21/95         US                9/22/9S        Methods and Kits for Mammalian Gene
692434                  1/21/94         Australia         6/11/98        Profiling
E160178                 1/21/94         Austria           11/12/97
0 680 517               1/21/94         Belgium           11/12/97
2154265                 1/21/94         Canada
0 680 517               1/21/94         Denmark           11/12/97
0 680 517               1/21/94         EPC               11/12/97
0 680 517               1/21/94         France            11/12/97
694 06 772.5-08         1/21/94         Germany           11/12/97
980400301               1/21/94         Greece            11/12/97
0 680 517                               Hong Kong
E77394                  1/21/94         Ireland           11/12/97
20035BE/98              1/21/94         Italy             11/12/97
6-517147                1/21/94         Japan
0 680 517               1/21/94         Luxembourg        11/12/97
0 680 517               1/21/94         Monaco            11/12/97
0 680 517               1/21/94         Netherlands       11/12/97
US94/00583              1/21/94         PCT
0 680 517               1/21/94         Portugal          1/19/98
9601405-5               2/13/96         Singapore
0 680 517               1/21/94         Spain             11/12/97
0 680 517               1/21/94         Sweden            11/12/97
0 680 517               1/21/94         Switzerland       11/12/97
0 680 517               1/21/94         UK                11/12/97
</TABLE>

                                       15
<PAGE>   17

                                    EXHIBIT B

                            HARVARD LICENSE AGREEMENT

                                       16

<PAGE>   18

                                    EXHIBIT C

                            HARVARD LETTER AGREEMENT

                                       17

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