Document:

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                                                                    Exhibit 10.1

                               BUILD-TO-SUIT LEASE

                            EOS Biotechnology, Inc.

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                               BUILD-TO-SUIT LEASE

Landlord:         Slough BTC, LLC

Tenant:           EOS Biotechnology, Inc.

Date:             June 1, 2001

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                                              TABLE OF CONTENTS

<S>      <C>                                                                                 <C>
1.       PROPERTY..............................................................................1
         1.1      Lease of Building............................................................1
         1.2      Landlord's Reserved Rights...................................................1
         1.3      Right of First Offer.........................................................2

2.       TERM..................................................................................2
         2.1      Term.........................................................................2
         2.2      Early Possession.............................................................3
         2.3      Delay In Possession..........................................................3
         2.4      Acknowledgment Of Rent Commencement..........................................5
         2.5      Holding Over.................................................................5
         2.6      Option To Extend Term........................................................5

3.       RENTAL................................................................................6
         3.1      Minimum Rental...............................................................6
                  (a)      Rental Amounts......................................................6
                  (b)      Rental Amounts During First Extended Term...........................6
                  (c)      Rental Amounts During Second Extended Term..........................7
                  (d)      Rental Adjustment Due to Change in Square Footage...................7
                  (e)      Rental Adjustment Due to Tenant Improvement Costs...................7
         3.2      Late Charge..................................................................8

4.       STOCK WARRANTS........................................................................8
         4.1      Stock Warrants...............................................................8

5.       CONSTRUCTION..........................................................................9
         5.1      Construction of Improvements.................................................9
         5.2      Condition of Property........................................................9
         5.3      Compliance with Law..........................................................9

6.       TAXES.................................................................................10
         6.1      Personal Property............................................................10
         6.2      Real Property................................................................10

7.       OPERATING EXPENSES....................................................................10
         7.1      Payment of Operating Expenses................................................10
         7.2      Definition Of Operating Expenses.............................................11
         7.3      Determination Of Operating Expenses..........................................12
         7.4      Final Accounting For Lease Year..............................................13
         7.5      Proration....................................................................13

8.       UTILITIES.............................................................................13
         8.1      Payment......................................................................13
         8.2      Interruption.................................................................14

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<S>      <C>                                                                                 <C>
9.       ALTERATIONS; SIGNS....................................................................14
         9.1      Right To Make Alterations....................................................14
         9.2      Title To Alterations.........................................................14
         9.3      Tenant Trade Fixtures........................................................15
         9.4      No Liens.....................................................................15
         9.5      Signs........................................................................16

10.      MAINTENANCE AND REPAIRS...............................................................16
         10.1     Landlord's Work..............................................................16
         10.2     Tenant's Obligation For Maintenance..........................................16
                  (a)      Good Order, Condition And Repair....................................16
                  (b)      Landlord's Remedy...................................................16
                  (c)      Condition Upon Surrender............................................16

11.      USE OF PROPERTY.......................................................................17
         11.1     Permitted Use................................................................17
         11.2     Requirement of Continued Use.................................................17
         11.3     No Nuisance..................................................................17
         11.4     Compliance With Laws.........................................................17
         11.5     Liquidation Sales............................................................18
         11.6     Environmental Matters........................................................18

12.      INSURANCE AND INDEMNITY...............................................................22
         12.1     Insurance....................................................................22
         12.2     Quality Of Policies And Certificates.........................................23
         12.3     Workers' Compensation........................................................24
         12.4     Waiver Of Subrogation........................................................24
         12.5     Increase In Premiums.........................................................24
         12.6     Indemnification..............................................................24
         12.7     Blanket Policy...............................................................25

13.      SUBLEASE AND ASSIGNMENT...............................................................25
         13.1     Assignment And Sublease Of Building..........................................25
         13.2     Rights Of Landlord...........................................................25

14.      RIGHT OF ENTRY AND QUIET ENJOYMENT....................................................26
         14.1     Right Of Entry...............................................................26
         14.2     Quiet Enjoyment..............................................................26

15.      CASUALTY AND TAKING...................................................................27
         15.1     Damage or Destruction........................................................27
         15.2     Condemnation.................................................................28
         15.3     Reservation Of Compensation..................................................29
         15.4     Restoration Of Improvements..................................................29

16.      DEFAULT...............................................................................30
         16.1     Events Of Default............................................................30
                  (a)      Abandonment.........................................................30
                  (b)      Nonpayment..........................................................30
                  (c)      Other Obligations...................................................30
                  (d)      General Assignment..................................................30
                  (e)      Bankruptcy..........................................................30
                  (f)      Receivership........................................................30
                  (g)      Attachment..........................................................30
                  (h)      Insolvency..........................................................31
         16.2     Remedies Upon Tenant's Default...............................................31
         16.3     Remedies Cumulative..........................................................32

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<Table>

<S>      <C>                                                                                 <C>
17.      SUBORDINATION, ATTORNMENT AND SALE....................................................32
         17.1     Subordination To Mortgage....................................................32
         17.2     Sale Of Landlord's Interest..................................................32
         17.3     Estoppel Certificates........................................................32
         17.4     Subordination to CC&R's......................................................33
         17.5     Mortgagee Protection.........................................................33

18.      SECURITY..............................................................................34
         18.1     Deposit......................................................................34

19.      MISCELLANEOUS.........................................................................35
         19.1     Notices......................................................................35
         19.2     Successors And Assigns.......................................................36
         19.3     No Waiver....................................................................37
         19.4     Severability.................................................................37
         19.5     Litigation Between Parties...................................................37
         19.6     Surrender....................................................................37
         19.7     Interpretation...............................................................37
         19.8     Entire Agreement.............................................................37
         19.9     Governing Law................................................................37
         19.10    No Partnership...............................................................37
         19.11    Financial Information........................................................37
         19.12    Costs........................................................................38
         19.13    Time.........................................................................38
         19.14    Rules And Regulations........................................................38
         19.15    Brokers......................................................................38
         19.16    Memorandum Of Lease..........................................................38
         19.17    Corporate Authority..........................................................39
         19.18    Execution and Delivery.......................................................39
         19.19    Survival.....................................................................39
         19.20    Parking and Traffic..........................................................39

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                                                          -iii-
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                                    EXHIBITS

                  EXHIBIT A            Real Property Description

                  EXHIBIT B            Site Plan

                  EXHIBIT C            Workletter

                  EXHIBIT D            Estimated Construction Schedule

                  EXHIBIT E            Acknowledgment of Rent Commencement Date

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                               BUILD-TO-SUIT LEASE

         THIS BUILD-TO-SUIT LEASE ("LEASE") is made and entered into as of June
1, 2001, by and between SLOUGH BTC, LLC, a Delaware limited liability company
("LANDLORD"), and EOS BIOTECHNOLOGY, INC., a Delaware corporation ("TENANT").

         THE PARTIES AGREE AS FOLLOWS:

                                   1. PROPERTY

         1.1      LEASE OF BUILDING.

                  (a)      Landlord leases to Tenant and Tenant hires and leases
from Landlord, on the terms, covenants and conditions hereinafter set forth, the
building (the "BUILDING") to be constructed pursuant to Article 5 hereof and
EXHIBIT C attached hereto on a portion of the real property described in EXHIBIT
A attached hereto (the "PROPERTY"), to consist of a three-story office and
laboratory building containing approximately 82,000 square feet. The location of
the Building on the Property is intended to be substantially as shown for the
building designated "BUILDING D" on the site plan attached hereto as EXHIBIT B
(the "SITE PLAN"). The Property is commonly known as Britannia Oyster Point (the
"CENTER") and is located at Oyster Point Boulevard and Veterans Boulevard in the
City of South San Francisco, County of San Mateo, State of California. The
Building and the other improvements to be constructed on the Property pursuant
to Article 5 hereof and EXHIBIT C attached hereto are sometimes referred to
collectively herein as the "IMPROVEMENTS." The parking areas, driveways,
sidewalks, landscaped areas and other portions of the Center that lie outside
the exterior walls of the buildings to be constructed in the Center, as depicted
in the Site Plan and as hereafter modified by Landlord from time to time in
accordance with the provisions of this Lease, are sometimes referred to herein
as the "COMMON AREAS."

                  (b)      As an appurtenance to Tenant's leasing of the
Building pursuant to Section 1.1(a), Landlord hereby grants to Tenant, for the
benefit of Tenant and its employees, suppliers, shippers, customers and
invitees, during the term of this Lease, the non-exclusive right to use, in
common with others entitled to such use, (i) those portions of the Common Areas
improved from time to time for use as parking areas, driveways, sidewalks,
landscaped areas, or for other common purposes, and (ii) all access easements
and similar rights and privileges relating to or appurtenant to the Center and
created or existing from time to time under any access easement agreements,
declarations of covenants, conditions and restrictions, or other written
agreements now or hereafter of record with respect to the Center, subject
however to any limitations applicable to such rights and privileges under
applicable law, under this Lease and/or under the written agreements creating
such rights and privileges.

         1.2      LANDLORD'S RESERVED RIGHTS. To the extent reasonably necessary
to permit Landlord to exercise any rights of Landlord and discharge any
obligations of Landlord under this Lease, Landlord shall have, in addition to
the right of entry set forth in Section 16.1 hereof, the following rights: (i)
to make changes to the Common Areas, including, without limitation, changes in
the location, size or shape of any portion of the Common Areas, and to construct
and/or relocate parking structures and/or parking spaces in the Center; (ii) to
close temporarily any of the Common Areas for maintenance or other reasonable
purposes, PROVIDED that reasonable parking and reasonable access to the Building
remain available; (iii) to construct, alter or add to other buildings and Common
Area improvements in the Center; (iv) to build in areas adjacent to the Center
and to add such areas to the Center; (v) to use the Common Areas while engaged
in making additional improvements, repairs or alterations to the Center or any
portion thereof; and (vi) to do and perform such other acts with respect to the
Common Areas and the Center as may be necessary or appropriate; PROVIDED,
however, that notwithstanding anything to the contrary in this Section 1.2,
Landlord's exercise of its rights hereunder shall not cause any

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material diminution of Tenant's rights, nor any material increase of Tenant's
obligations, under this Lease.

         1.3      RIGHT OF FIRST OFFER. Tenant shall have the following right of
first offer ("RIGHT OF FIRST OFFER") to lease additional space in or adjacent to
the Center, PROVIDED, however, that such Right of First Offer shall not arise or
be effective if Tenant is in default hereunder, beyond any applicable notice and
cure periods, on the date Landlord would otherwise be required to notify Tenant
of the commencement and terms of such Right of First Offer pursuant to this
Section 1.3. Landlord has advised Tenant (a) that it is presently Landlord's
intention to develop Building E of the Center, as shown on the Site Plan
("BUILDING E"), as an office building rather than a biotechnology building, and
(b) that the property lying easterly of the Property and commonly known as 333
Oyster Point Boulevard, South San Francisco ("333 OYSTER POINT"), presently
operated as a commercial warehouse facility, is presently owned by Landlord. In
the event that either (x) Landlord decides, in its sole discretion, to develop
Building E as a biotechnology building or (y) Landlord or any affiliate of
Landlord to which 333 Oyster Point may be transferred, as applicable, decides to
redevelop 333 Oyster Point as a biotechnology facility, then in either such
event Tenant shall have a Right of First Offer to lease a minimum of 100,000
square feet of space in Building E (or the entirety of Building E, if less than
100,000 square feet) or the redeveloped 333 Oyster Point facility, as
applicable, and neither Landlord nor its affiliate, if applicable, shall lease
space in Building E or in the redeveloped 333 Oyster Point facility (excluding
any leases which, individually and in the aggregate, leave at least 100,000
square feet of space in the applicable building or facility to be offered to
Tenant pursuant to this Right of First Offer) without first complying with all
applicable provisions of this Section 1.3. Tenant's Right of First Offer with
respect to Building E or 333 Oyster Point, as applicable, shall commence upon
Tenant's receipt of written notice from Landlord (a "FIRST OFFER NOTICE")
identifying the building or facility to which the Right of First Offer applies,
the amount of space available in such building or facility (not to be less than
100,000 square feet or the entirety of the applicable building or facility, if
less than 100,000 square feet) and the rent, improvement allowance and other
material terms upon which Landlord proposes to offer space in such building or
facility. Tenant shall have ten (10) business days after receipt of a First
Offer Notice in which to reach agreement on all terms and achieve execution of a
written lease agreement with Landlord or its affiliate, as applicable, regarding
Tenant's leasing and occupancy of at least 100,000 square feet of space in the
building or facility covered by the First Offer Notice (or the entirety of such
building or facility, if less than 100,000 square feet). It is generally the
intention of the parties that the form of lease for any such leasing of space
pursuant to a First Offer Notice would be substantially identical to this Lease,
excluding this Section 1.3 and subject only to such other modifications as may
be reasonably necessary to reflect differences in the particular space to be
occupied pursuant to such new lease and/or in the economic terms applicable to
Tenant's leasing of such space. If Landlord and Tenant fail to reach agreement
on all terms and achieve execution of a written lease within ten (10) business
days after Tenant's receipt of a First Offer Notice, then Tenant shall have no
further rights under this Section 1.3 with respect to the building or facility
covered by such First Offer Notice and Landlord shall thereafter be free to
proceed with the leasing of such building or facility at any time and from time
to time without any further obligation to Tenant. If Tenant leases space in
either Building E or 333 Oyster Point pursuant to a First Offer Notice under
this Section 1.3, then Tenant shall have no further rights under this Section
1.3 with respect to either of such buildings or facilities (except Tenant's
rights under the written lease agreement entered into with respect to the
particular space covered by such First Offer Notice) and Landlord shall
thereafter be free to proceed with the further leasing of both such building and
such facility at any time and from time to time without any further obligation
to Tenant.

                                     2. TERM

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         2.1      TERM. The term of this Lease shall commence upon mutual
execution of this Lease by Landlord and Tenant. Tenant's minimum rental and
Operating Expense obligations shall commence on the earlier of (i) one hundred
eighty (180) days after Landlord's completion of the principal structural
components of the Building Shell (as hereinafter defined) pursuant to the
Workletter attached hereto as EXHIBIT C (the "WORKLETTER"), subject to any
adjustments in such time period to the extent authorized or required under the
provisions of such Workletter, which completion shall be evidenced by Landlord's
delivery of the Structural Completion Certificate pursuant to the Workletter, or
(ii) the date Tenant takes occupancy of and commences operation of its business
in the Building, the earlier of such dates being herein called the "RENT
COMMENCEMENT DATE"; PROVIDED, however, that in no event shall the Rent
Commencement Date occur earlier than January 1, 2003 unless determined pursuant
to clause (ii) of this sentence or unless an earlier date is hereafter mutually
agreed upon in writing by Landlord and Tenant. The term of this Lease shall end
on the day (the "TERMINATION DATE") immediately preceding the fifteenth (15th)
anniversary of the Rent Commencement Date, unless sooner terminated or extended
as hereinafter provided.

         2.2      EARLY POSSESSION. Tenant shall have the nonexclusive right to
occupy and use the Building from and after the date of Landlord's delivery of
the Structural Completion Certificate described in clause (i) of Section 2.1,
even though Landlord may be continuing to construct the balance of Landlord's
Work as contemplated in the Workletter, for the purpose of constructing Tenant's
Work as contemplated in the Workletter and for the purpose of installing
fixtures and furniture, laboratory equipment, computer equipment, telephone
equipment, low voltage data wiring and personal property and other similar work
related to the construction of Tenant's Work and/or preparatory to the
commencement of Tenant's business in the Building. Such occupancy and
possession, and any early access under the next sentence of this Section 2.2,
shall be subject to and upon all of the terms and conditions of this Lease and
of the Workletter (including, but not limited to, conditions relating to the
maintenance of required insurance), except that Tenant shall have no obligation
to pay minimum rental or Operating Expenses for any period prior to the Rent
Commencement Date as determined under Section 2.1; such early possession shall
not advance or otherwise affect the Rent Commencement Date or Termination Date
determined under Section 2.1. Tenant shall also be entitled to have early access
to the Building and the Property at all appropriate times prior to Landlord's
delivery of the Structural Completion Certificate, subject to the approval of
Landlord and its general contractor (which approval shall not be unreasonably
withheld or delayed) and to all other provisions of this Section 2.2, for the
purpose of performing work preparatory to the construction of Tenant's Work or
necessary for the orderly sequencing of such Work and/or for the actual
construction of Tenant's Work pursuant to the Workletter, and Tenant shall not
be required to pay minimum rental or Operating Expenses by reason of such early
access until the Rent Commencement Date otherwise occurs; without limiting the
generality of the preceding portion of this sentence, Tenant shall be entitled
to have early access to the Property and the Building as soon as the roof metal
decking is in place to begin hanging electrical, mechanical and plumbing
services from the overhead structure, subject to all of the provisions of this
Section 2.2. Tenant shall not unreasonably interfere with or delay Landlord's
contractors by any early access, occupancy or possession under this Section 2.2,
shall coordinate and cooperate with Landlord and its contractors (who shall
similarly coordinate and cooperate with Tenant and its contractors) to minimize
any interference or delay by either party with respect to the other party's work
following Landlord's delivery of the Structural Completion Certificate, and
shall indemnify, defend and hold harmless Landlord and its agents and employees
from and against any and all claims, demands, liabilities, actions, losses,
costs and expenses, including (but not limited to) reasonable attorneys' fees,
arising out of or in connection with Tenant's early entry upon the Property
hereunder.

         2.3      DELAY IN POSSESSION. Landlord agrees to use its best
reasonable efforts to complete its portion of the work described in Section 5.1
and the Workletter promptly, diligently and within the respective time periods
set forth in the Estimated Construction Schedule attached hereto as EXHIBIT D
and incorporated herein by this reference, as such schedule may be modified from
time to time by mutual written agreement of Landlord and Tenant, and subject to
the effects of any delays caused by or attributable to Tenant or any other
circumstances beyond Landlord's reasonable control (excluding financial
inability); PROVIDED, however, that Landlord shall not be

                                      -3-
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liable for any damages caused by any delay in the completion of such work, nor
shall any such delay affect the validity of this Lease or the obligations of
Tenant hereunder. Notwithstanding any other provisions of this Section 2.3,
however:

                  (a)      In recognition of the fact that Tenant's sublease
of the space presently occupied by Tenant at 225A Gateway Boulevard, South
San Francisco, California ("TENANT'S EXISTING PREMISES") is scheduled to
terminate on March 31, 2003, Landlord agrees that if Landlord fails to
deliver the Structural Completion Certificate and tender possession of those
completed structural portions of the Building Shell for the Building that
must be completed as a condition of delivery of the Structural Completion
Certificate by the date which is one hundred twenty (120) days after May 31,
2002 (the date specified for structural completion in the Estimated
Construction Schedule attached hereto as EXHIBIT D), then Landlord shall
reimburse Tenant, in accordance with the provisions of this paragraph and
subject to the limitations set forth herein, for an amount equal to fifty
percent (50%) of Tenant's Excess Occupancy Costs; PROVIDED, however, that the
above-referenced 120-day period shall be extended (and the possible
triggering of Landlord's reimbursement obligation shall therefore be
deferred), day for day, for a period equal to the length of any delays in
Landlord's design and construction of the Building Shell that are caused by
acts of God, action or inaction of public agencies, labor disputes, strikes,
fires, freight embargoes, rainy or stormy weather, inability to obtain
supplies, materials, fuels or permits, delays of contractors or
subcontractors, Tenant Delays (as defined in the Workletter), or other causes
or contingencies beyond the reasonable control of Landlord (excluding
financial inability). For purposes of this paragraph, "TENANT'S EXCESS
OCCUPANCY COSTS" shall mean the amount (if any) by which the monthly gross
rental expenses (including, but not limited to, basic rent, holdover rent,
expense passthroughs and other forms of additional rent) reasonably incurred
by Tenant for space occupied by Tenant for the conduct of Tenant's business
after March 31, 2003 (which space may consist of either Tenant's Existing
Premises if Tenant is able to continue to occupy them on a holdover basis, or
any substitute space taken by Tenant on a temporary basis if Tenant is forced
to vacate Tenant's Existing Premises prior to the time Tenant is able to
occupy the Building hereunder) EXCEED Tenant's monthly gross rental expenses
for Tenant's Existing Premises immediately prior to the expiration of
Tenant's sublease thereof. During any period when Landlord's reimbursement
obligation under this paragraph is in effect, Tenant shall provide Landlord
with a written calculation of Tenant's Excess Occupancy Costs (including any
supporting information reasonably requested by Landlord to evidence or
confirm the various expenses on which such calculation is based) on a monthly
basis and Landlord shall pay Tenant the amount properly due under each such
statement within fifteen (15) days after Landlord's receipt of the statement
and related supporting information. Landlord's reimbursement obligation under
this paragraph shall in all events terminate upon the earlier to occur of (i)
thirty (30) days after the Rent Commencement Date hereunder or (ii) Tenant's
exercise of its termination right under Section 2.3(b) hereof, if such right
becomes exercisable in accordance with its terms and is in fact exercised by
Tenant.

                  (b)      If Landlord fails to deliver the Structural
Completion Certificate and tender possession of those completed structural
portions of the Building Shell for the Building that must be completed as a
condition of delivery of the Structural Completion Certificate by the date which
is one hundred eighty (180) days after May 31, 2002 (the date specified for
structural completion in the Estimated Construction Schedule attached hereto as
EXHIBIT D), then Tenant shall have the right to terminate this Lease without
further liability hereunder by written notice delivered to Landlord at any time
prior to Landlord's delivery of the Structural Completion Certificate for the
Building and tender of possession of the completed structural portions of the
Building Shell to Tenant and Landlord shall return to Tenant (i) all unexercised
warrants given to Landlord by Tenant pursuant to Section 4.1, (ii) to the extent
any of the warrants given to Landlord by Tenant pursuant to Section 4.1 have
been exercised prior to such termination, an amount equal to the excess (if any)
of the aggregate fair market value of the shares acquired by Landlord pursuant
to such exercise, measured on the date of Landlord's exercise of such warrants,
over the aggregate exercise price for such exercised warrants, and (iii) any
amounts prepaid by Tenant to Landlord pursuant to this Lease (including, but not
limited to, any prepaid Rent and the Security Deposit); PROVIDED, however, that
the date on which Tenant's termination right becomes exercisable pursuant to
this sentence shall be extended, day for day, for a period

                                      -4-
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equal to the length of any delays in Landlord's design and construction of the
Building Shell that are caused by acts of God, action or inaction of public
agencies, labor disputes, strikes, fires, freight embargoes, rainy or stormy
weather, inability to obtain supplies, materials, fuels or permits, delays of
contractors or subcontractors, Tenant Delays (as defined in the Workletter), or
other causes or contingencies beyond the reasonable control of Landlord
(excluding financial inability).

         2.4      ACKNOWLEDGMENT OF RENT COMMENCEMENT. Promptly following the
Rent Commencement Date, Landlord and Tenant shall execute a written
acknowledgment of the Rent Commencement Date, Termination Date and related
matters, substantially in the form attached hereto as EXHIBIT E (with
appropriate insertions), which acknowledgment shall be deemed to be incorporated
herein by this reference. Notwithstanding the foregoing requirement, the failure
of either party to execute such a written acknowledgment shall not affect the
determination of the Rent Commencement Date, Termination Date and related
matters in accordance with the provisions of this Lease.

         2.5      HOLDING OVER. If Tenant holds possession of the Property or
any portion thereof after the term of this Lease WITH Landlord's written
consent, then except as otherwise specified in such consent, Tenant shall become
a tenant from month to month at one hundred twenty-five percent (125%) of the
rental and otherwise upon the terms herein specified for the period immediately
prior to such holding over and shall continue in such status until the tenancy
is terminated by either party upon not less than thirty (30) days prior written
notice. If Tenant holds possession of the Property or any portion thereof after
the term of this Lease WITHOUT Landlord's written consent, then Landlord in its
sole discretion may elect (by written notice to Tenant) to have Tenant become a
tenant either from month to month or at will, at one hundred fifty percent
(150%) of the rental (prorated on a daily basis for an at-will tenancy, if
applicable) and otherwise upon the terms herein specified for the period
immediately prior to such holding over, or may elect to pursue any and all legal
remedies available to Landlord under applicable law with respect to such
unconsented holding over by Tenant. Tenant shall indemnify and hold Landlord
harmless from any loss, damage, claim, liability, cost or expense (including
reasonable attorneys' fees) resulting from any delay by Tenant in surrendering
the Property or any portion thereof, including but not limited to any claims
made by a succeeding tenant by reason of such delay; PROVIDED, however, that the
indemnification and hold harmless obligation set forth in this sentence shall
not apply with respect to any holdover period to which Landlord has consented in
writing, except to the extent either (i) Tenant fails to vacate and surrender
the Premises by the end of the holdover period to which Landlord has thus
consented, or (ii) Landlord advised Tenant in writing of Landlord's anticipated
damages from Tenant's holding over at the time Landlord granted its written
consent to such holding over. Acceptance of rent by Landlord following
expiration or termination of this Lease shall not constitute a renewal of this
Lease.

         2.6      OPTION TO EXTEND TERM. Tenant shall have the option to extend
the term of this Lease, at the minimum rental set forth in Section 3.1(b) and
(c) (as applicable) and otherwise upon all the terms and provisions set forth
herein with respect to the initial term of this Lease, for up to two (2)
additional periods of five (5) years each, the first commencing upon the
expiration of the initial term hereof and the second commencing upon the
expiration of the first extended term, if any. Exercise of such option with
respect to the first such extended term shall be by written notice to Landlord
at least nine (9) months and not more than twelve (12) months prior to the
expiration of the initial term hereof; exercise of such option with respect to
the second extended term, if the first extension option has been duly exercised,
shall be by like written notice to Landlord at least nine (9) months and not
more than twelve (12) months prior to the expiration of the first extended term
hereof. If Tenant is in default hereunder, beyond any applicable notice and cure
periods, on the date of such notice or on the date any extended term is to
commence, then the exercise of the option shall be of no force or effect, the
extended term shall not commence and this Lease shall expire at the end of the
then current term hereof (or at such earlier time as Landlord may elect pursuant
to the default provisions of this Lease). If Tenant properly exercises one or
more extension options under this Section, then all references in this Lease
(other than in this Section 2.6) to the "term" of this Lease shall be construed
to include

                                      -5-
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the extension term(s) thus elected by Tenant. Except as expressly set forth in
this Section 2.6, Tenant shall have no right to extend the term of this Lease
beyond its prescribed term.

                                    3. RENTAL

         3.1      MINIMUM RENTAL.

                  (a)      RENTAL AMOUNTS. Tenant shall pay to Landlord as
minimum rental for the Building, in advance, without deduction, offset, notice
or demand, on or before the Rent Commencement Date and on or before the first
day of each subsequent calendar month of the initial term of this Lease, the
following amounts per month, subject to adjustment in accordance with the terms
of this Section 3.1:

<Table>
<Caption>

                            Months                   Monthly Minimum Rental
                            ------                   ----------------------
                           <S>                       <C>
                           001 - 012                 $  369,000.00 ($4.5000/sq ft)
                           013 - 024                    383,760.00 ($4.6800/sq ft)
                           025 - 036                    399,110.40 ($4.8672/sq ft)
                           037 - 048                    415,074.82 ($5.0619/sq ft)
                           049 - 060                    431,677.81 ($5.2644/sq ft)
                           061 - 072                    448,944.92 ($5.4749/sq ft)
                           073 - 084                    466,902.72 ($5.6939/sq ft)
                           085 - 096                    485,578.83 ($5.9217/sq ft)
                           097 - 108                    505,001.98 ($6.1586/sq ft)
                           109 - 120                    525,202.06 ($6.4049/sq ft)
                           121 - 132                    546,210.14 ($6.6611/sq ft)
                           133 - 144                    568,058.55 ($6.9275/sq ft)
                           145 - 156                    590,780.89 ($7.2046/sq ft)
                           157 - 168                    614,412.12 ($7.4928/sq ft)
                           169 - 180                    638,988.61 ($7.7925/sq ft)

</Table>

If the obligation to pay minimum rental hereunder commences on other than the
first day of a calendar month or if the term of this Lease terminates on other
than the last day of a calendar month, the minimum rental for such first or last
month of the term of this Lease, as the case may be, shall be prorated based on
the number of days the term of this Lease is in effect during such month. If an
increase in minimum rental becomes effective on a day other than the first day
of a calendar month, the minimum rental for that month shall be the sum of the
two applicable rates, each prorated for the portion of the month during which
such rate is in effect.

                  (b)      RENTAL AMOUNTS DURING FIRST EXTENDED TERM. If Tenant
properly exercises its right to extend the term of this Lease pursuant to
Section 2.6 hereof, the minimum rental during the first year of the first
extended term shall be equal to the fair market rental value of the Building (as
defined below), determined as of the commencement of such extended term in
accordance with this Section 3.1(b), and during each subsequent year of the
first extended term shall be increased in accordance with the rental increase
provisions customary in the City of South San Francisco for comparable
commercial leases for office, laboratory and research and development projects
as of the commencement of the first extended term (which rental increase
provisions shall be determined as of the commencement of the first extended term
in accordance with this Section 3.1(b), but shall in no event provide for an
annual increase of less than three percent (3%) of the minimum rental in
effect during the immediately preceding lease year). Upon Landlord's receipt of
a proper notice of Tenant's exercise of its option to extend the term of this
Lease, the parties shall have sixty (60) days in which to agree on the initial
fair market rental and the applicable rental increase provisions for the
Building as of the commencement of the first extended term for the uses
permitted hereunder. If the parties agree on such fair market rental and rental
increase provisions, they shall execute an amendment to this Lease stating the
amount of the initial minimum monthly rental and the applicable rental increase
provisions for

                                      -6-
<Page>

the first extended term. If the parties are unable to agree on such fair market
rental and rental increase provisions within such sixty (60) day period, then
within fifteen (15) days after the expiration of such period each party, at its
cost and by giving notice to the other party, shall appoint a real estate
appraiser who is a member of the American Institute of Real Estate Appraisers,
or any other similar organization, and has at least five (5) years experience
appraising similar commercial properties in northeastern San Mateo County, to
determine the fair market rental and applicable rental increase provisions for
the Building as of the commencement of the first extended term in accordance
with the provisions of this Section 3.1(b). If either party fails to appoint an
appraiser within the allotted time, the single appraiser appointed by the other
party shall be the sole appraiser. If an appraiser is appointed by each party
and the two appraisers so appointed are unable to agree upon the fair market
rental and applicable rental increase provisions within thirty (30) days after
the appointment of the second, the two appraisers shall appoint a third
similarly qualified appraiser within ten (10) days after expiration of such
30-day period; if they are unable to agree upon a third appraiser, then either
party may, upon not less than five (5) days notice to the other party, apply to
the Presiding Judge of the San Mateo County Superior Court for the appointment
of a third similarly qualified appraiser. Each party shall bear its own legal
fees in connection with appointment of the third appraiser and shall bear
one-half of any other costs of appointment of the third appraiser and of such
third appraiser's fee. The third appraiser, however selected, shall be a person
who has not previously acted for either party in any capacity. Within thirty
(30) days after the appointment of the third appraiser, a majority of the three
appraisers shall determine the fair market rental and applicable rental increase
provisions for the first extended term and shall so notify the parties. If a
majority are unable to agree within the allotted time, (i) the three appraised
fair market rental amounts shall be added together and divided by three and the
resulting quotient shall be the initial fair market rental for the first
extended term, and (ii) the applicable rental increase provision shall be equal
to the mathematical average (or the nearest reasonable approximation thereto) of
the two rental increase provisions that are most closely comparable (but in no
event less than three percent (3%) per year over the minimum rent in effect
in the immediately preceding lease year), which determinations shall be binding
on the parties and shall be enforceable in any further proceedings relating to
this Lease. For purposes of this Section 3.1(b), the "FAIR MARKET RENTAL" of the
Building shall be determined with reference to the then prevailing market rental
rates for properties in the City of South San Francisco with shell and office,
research and development improvements and site (common area) improvements
comparable to those then existing in the Building and on the Property, taking
into account for such determination all tenant improvements then existing in the
Building (including, but not limited to, equipment and laboratory improvements
installed as part of the initial Tenant Improvements pursuant to Section 5.1 and
the Workletter) OTHER THAN improvements or alterations which were constructed by
Tenant at its sole expense and which Tenant has a right or obligation to remove
from the Building at the expiration of this Lease pursuant to the provisions of
Article 9 hereof.

                  (c)      RENTAL AMOUNTS DURING SECOND EXTENDED TERM. If Tenant
properly exercises its right to a second extended term of this Lease pursuant to
Section 2.6 hereof, the minimum rental during such second extended term shall be
determined in the same manner provided in the preceding paragraph for the first
extended term, except that the determination shall be made as of the
commencement of the second extended term.

                  (d)      RENTAL ADJUSTMENT DUE TO CHANGE IN SQUARE FOOTAGE.
The minimum rental amounts specified in Section 3.1(a) are based upon an
estimated area of 82,000 square feet for the Building. If the actual area of the
Building (measured from the exterior faces of exterior walls and from the
dripline of any overhangs), when completed, is greater or less than such
estimated area, then the minimum rentals specified in Section 3.1(a) shall be
adjusted for each rental period in strict proportion to the ratio between the
actual area of the Building during the applicable period (determined on the
basis of measurement described above in this sentence) and the assumed area of
82,000 square feet. Measurement of building area under this paragraph shall be
made initially by Landlord's architect, subject to review and approval by
Tenant's architect.

                  (e)      RENTAL ADJUSTMENT DUE TO TENANT IMPROVEMENT COSTS.
The minimum rental amounts specified in Section 3.1(a) are based on the
assumption that Landlord will pay out

                                      -7-
<Page>

its maximum required Tenant Improvement Allowance (as defined in the
Workletter) of $115.00 per square foot, as specified in the Workletter, in
connection with Tenant's construction of Tenant's Work as described in the
Workletter. If, following completion of Tenant's Work pursuant to the
Workletter, the total amount funded by Landlord as part of the Tenant
Improvement Allowance under the Workletter (including any amounts chargeable
against the Tenant Improvement Allowance pursuant to Paragraph 4(a) of the
Workletter, if applicable) is less than the maximum Tenant Improvement
Allowance of $115.00 per square foot, then for each dollar ($1.00) per square
foot (prorated for any amount less than a full dollar per square foot) by
which the total amount thus funded by Landlord is less than such maximum
Tenant Improvement Allowance, the minimum rental amounts set forth in Section
3.1(a) shall be reduced for each applicable period by One Cent ($0.01) per
square foot per month; PROVIDED, however, that the foregoing adjustment shall
not apply to any amounts by which the total amount funded by Landlord as part
of the Tenant Improvement Allowance under the Workletter (including any
amounts chargeable against the Tenant Improvement Allowance pursuant to
Paragraph 4(a) of the Workletter, if applicable) is less than $100.00 per
square foot, and therefore the maximum potential reduction in minimum rental
amounts under Section 3.1(a) pursuant to this subsection (e), if the total
amount thus funded by Landlord is $100.00 per square foot or less, shall be
Fifteen Cents ($0.15) per square foot per month.

         3.2      LATE CHARGE. If Tenant fails to pay rental or other amounts
due Landlord hereunder within thirty (30) days after the date such rental or
other amount is due, such unpaid amounts shall bear interest for the benefit of
Landlord at a rate equal to the lesser of fifteen percent (15%) per annum or the
maximum rate permitted by law, from the date thirty (30) days after the due date
to the date of actual payment. In addition to such interest, Tenant shall pay to
Landlord a late charge in an amount equal to six percent (6%) of any installment
of minimum rental and any other amounts due Landlord if not paid in full on or
before the fifth (5th) day after such rental or other amount is due. Tenant
acknowledges that late payment by Tenant to Landlord of rental or other amounts
due hereunder will cause Landlord to incur costs not contemplated by this Lease,
including, without limitation, processing and accounting charges and late
charges which may be imposed on Landlord by the terms of any loan relating to
the Property. Tenant further acknowledges that it is extremely difficult and
impractical to fix the exact amount of such costs and that the late charge set
forth in this Section 3.2 represents a fair and reasonable estimate thereof.
Acceptance of any late charge by Landlord shall not constitute a waiver of
Tenant's default with respect to overdue rental or other amounts, nor shall such
acceptance prevent Landlord from exercising any other rights and remedies
available to it. Acceptance of rent or other payments by Landlord shall not
constitute a waiver of late charges or interest accrued with respect to such
rent or other payments or any prior installments thereof, nor of any other
defaults by Tenant, whether monetary or non-monetary in nature, remaining
uncured at the time of such acceptance of rent or other payments.

                                4. STOCK WARRANTS

         4.1      STOCK WARRANTS. Within thirty (30) days after the mutual
execution of this Lease, Tenant shall deliver to Landlord or Landlord's
designees (which may be any members, partners, shareholders or affiliates of
Landlord or any affiliates of any such members, partners, shareholders or
affiliates of Landlord) warrants registered in the name of Landlord or
Landlord's designees for the acquisition of an aggregate of two hundred thousand
(200,000) shares of Tenant's common stock, which warrants shall be in form and
substance mutually approved by Landlord and Tenant prior to Lease execution as
being mutually satisfactory to them. The warrants shall have an exercise price
per share equal to the greater of (a) the price per share of preferred stock in
the most recently completed arm's-length issuance or sale of Tenant's preferred
stock as of the date of this Lease or (b) the value per share of Tenant's
outstanding preferred stock as determined by Tenant's independent auditors
(presently Ernst & Young, LLP) as of the date of this Lease, and shall be
exercisable for a period beginning on the date of this Lease and ending on the
later to occur of (a) the seventh (7th) anniversary of the date of this Lease or
(b) the fifth (5th) anniversary of the closing of the initial public offering of
Tenant's common stock.

                                      -8-
<Page>

                                 5. CONSTRUCTION

         5.1      CONSTRUCTION OF IMPROVEMENTS.

                  (a)      Landlord shall, at Landlord's cost and expense
(except as otherwise provided herein and in the Workletter), construct
Landlord's Work as defined in and in accordance with the terms and conditions of
the Workletter. Landlord shall use its best reasonable efforts to complete such
construction promptly, diligently and within the applicable time periods set
forth in the Estimated Construction Schedule attached hereto as EXHIBIT D and
incorporated herein by this reference, as such schedule may be modified from
time to time in accordance with the Workletter, subject to the effects of any
delays caused by Tenant or any other circumstances beyond Landlord's reasonable
control (excluding any financial inability), and subject to the provisions of
Section 2.3 above.

                  (b)      Tenant shall, at Tenant's cost and expense (except as
otherwise provided herein and in the Workletter), construct Tenant's Work as
defined in and in accordance with the terms and conditions of the Workletter.
Tenant shall use its best reasonable efforts to complete such construction
promptly, diligently and within the applicable time periods set forth in the
Estimated Construction Schedule attached hereto as EXHIBIT D and incorporated
herein by this reference, as such schedule may be modified from time to time in
accordance with the Workletter, subject to the effects of any delays caused by
Landlord or any other circumstances beyond Tenant's reasonable control
(excluding any financial inability).

         5.2      CONDITION OF PROPERTY. Landlord shall deliver the Building
Shell and other Improvements constructed by Landlord to Tenant clean and free of
debris, promptly upon completion of construction thereof, and Landlord warrants
to Tenant that the Building Shell and other Improvements constructed by Landlord
(i) shall be free from material structural defects and shall be in good
operating condition on the Rent Commencement Date, and (ii) shall be constructed
in compliance in all material respects with the plans and specifications
developed pursuant to the Workletter and mutually approved (to the extent
required thereunder) by Landlord and Tenant, subject to any changes implemented
in such plans and specifications in accordance with the procedures set forth in
the Workletter. If this warranty is violated in any respect, then it shall be
the obligation of Landlord, after receipt of written notice from Tenant setting
forth with specificity the nature of the violation, to correct promptly and
diligently, at Landlord's sole cost, the condition(s) constituting such
violation. Tenant's failure to give such written notice to Landlord within
ninety (90) days after the Rent Commencement Date shall give rise to a
conclusive presumption that Landlord has complied with all Landlord's
obligations under this Section 5.2, except with respect to latent defects (as to
which such 90-day limitation shall not apply). Without limiting the scope of
Landlord's obligations under the foregoing provisions of this Section 5.2,
Landlord also agrees to either (x) use its best reasonable efforts to enforce
when and as necessary, for the benefit of Tenant and the Improvements, any and
all contractor's and/or manufacturer's warranties extending more than ninety
(90) days after the Rent Commencement Date with respect to any of Landlord's
Work or, at Tenant's request, (y) assign any or all of such warranties to Tenant
for enforcement purposes (PROVIDED, however, that Landlord may reserve joint
enforcement rights under such warranties to the extent of Landlord's continuing
obligations or warranties hereunder). TENANT ACKNOWLEDGES THAT THE WARRANTY
CONTAINED IN THIS SECTION IS IN LIEU OF ALL OTHER WARRANTIES, EXPRESS OR
IMPLIED, WITH RESPECT TO THE PHYSICAL CONDITION OF THE IMPROVEMENTS TO BE
CONSTRUCTED BY LANDLORD AND THAT LANDLORD MAKES NO OTHER WARRANTIES EXCEPT AS
EXPRESSLY SET FORTH IN THIS LEASE.

         5.3      COMPLIANCE WITH LAW. Landlord warrants to Tenant that the
Building Shell and other Improvements constructed by Landlord (when
constructed), as they exist on the Rent Commencement Date, but without regard to
the use for which Tenant will occupy the Building, shall not violate any
covenants or restrictions of record or any applicable law, building code,

                                      -9-
<Page>

regulation or ordinance in effect on the Rent Commencement Date. Tenant warrants
to Landlord that the Tenant Improvements and any other improvements constructed
by Tenant from time to time shall not violate any applicable law, building code,
regulation or ordinance in effect on the Rent Commencement Date or at the time
such improvements are placed in service. If it is determined that any of these
warranties has been violated, then it shall be the obligation of the warranting
party, after written notice from the other party, to correct the condition(s)
constituting such violation promptly, at the warranting party's sole cost and
expense. Tenant acknowledges that except as expressly set forth in this Lease,
neither Landlord nor any agent of Landlord has made any representation or
warranty as to the present or future suitability of the Property or Improvements
for the conduct of Tenant's business or proposed business thereon.

                                    6. TAXES

         6.1      PERSONAL PROPERTY. Tenant shall be responsible for and shall
pay prior to delinquency all taxes and assessments levied against or by reason
of (a) any and all alterations, additions and items installed or placed on or in
the Building and taxed as personal property rather than as real property, and/or
(b) all personal property, trade fixtures and other property placed by Tenant on
or about the Property. Upon request by Landlord, Tenant shall furnish Landlord
with satisfactory evidence of Tenant's payment thereof. If at any time during
the term of this Lease any of said alterations, additions or personal property,
whether or not belonging to Tenant, shall be taxed or assessed as part of the
Center, then such tax or assessment shall be paid by Tenant to Landlord within
fifteen (15) days after presentation by Landlord of copies of the tax bills in
which such taxes and assessments are included and shall, for the purposes of
this Lease, be deemed to be personal property taxes or assessments under this
Section 6.1.

         6.2      REAL PROPERTY. To the extent any real property taxes and
assessments on the Building (including, but not limited to, the Improvements)
are assessed directly to Tenant, Tenant shall be responsible for and shall pay
prior to delinquency all such taxes and assessments levied against the Building.
Upon request by Landlord, Tenant shall furnish Landlord with satisfactory
evidence of Tenant's payment thereof. To the extent the Property and/or
Improvements are taxed or assessed to Landlord following the Rent Commencement
Date, such real property taxes and assessments shall constitute Operating
Expenses (as that term is defined in Section 7.2 of this Lease) and shall be
paid in accordance with the provisions of Article 7 of this Lease.

                              7. OPERATING EXPENSES

         7.1      PAYMENT OF OPERATING EXPENSES.

                                      -10-
<Page>

                  (a)      Tenant shall pay to Landlord, at the time and in the
manner hereinafter set forth, as additional rental, an amount equal to sixteen
and ninety-eight hundredths percent (16.98%) ("TENANT'S OPERATING COST SHARE")
of the Operating Expenses defined in Section 7.2, subject to adjustment pursuant
to Sections 7.1(b) and (c) when applicable. Notwithstanding the foregoing, with
respect to liability insurance premiums (except to the extent separately and
specifically allocable to the Building, in which event Tenant's Operating Cost
Share with respect thereto shall be 100%), the land component of real property
taxes and assessments, common area lighting and maintenance expenses, and other
similar expenses that are incurred or measured on a Center-wide basis (rather
than being clearly and reasonably allocable or attributable to the Building
alone, in which event Tenant's Operating Cost Share with respect thereto shall
be 100%) or that are incurred with respect to common area facilities,
notwithstanding any other provisions of this Article 7, Tenant's Operating Cost
Share with respect to such Center-wide and/or common area expenses from and
after the Rent Commencement Date, regardless of the status of construction and
occupancy of the other contemplated buildings in the Center, shall be equal to
the percentage amount which is equivalent to a fraction, the numerator of which
is the square footage of the Building as actually constructed, as determined in
good faith by Landlord's architect on the basis of measurement set forth in
Section 3.1(d) hereof, and the denominator of which is the sum of the actual
square footage of all then completed buildings in the Center plus the proposed
square footage (as reflected in Landlord's entitlements for the Property) of all
not yet completed buildings that Landlord proposes to construct in the Center
(excluding the proposed child care facility and proposed stand-alone restaurant
as hereinafter set forth), in each case as determined in good faith by
Landlord's architect on the basis of measurement set forth in Section 3.1(d)
hereof, consistently applied; PROVIDED, however, that the adjusted Tenant's
Operating Cost Share determined pursuant to this sentence shall be further
adjusted from time to time to reflect (x) any difference between the actual
square footage of an additional building completed in the Center from time to
time and the proposed square footage at which such additional building was
previously included in the application of the foregoing formula, and (y) any
increase or decrease in the aggregate square footage of the buildings that
Landlord proposes to construct in the Center as part of the initial phased
development of the Center (such as, but not limited to, any decision by Landlord
to defer indefinitely, beyond the normal and reasonable phasing of the Center,
the construction of any of the planned buildings in the Center and/or any action
by governmental authorities to reduce the aggregate square footage of the
buildings that Landlord is entitled to construct in the Center pursuant to
Landlord's entitlements as amended from time to time).

                  (b)      Tenant's Operating Cost Share as specified in Section
7.1(a) is based upon an estimated area of 82,000 square feet for the Building
and upon an aggregate estimated area of 483,000 square feet for all of the
buildings that Landlord presently expects to have in fully constructed and
occupied condition on the Property at the Rent Commencement Date. If the actual
area of the Building (when completed) or of the other buildings existing from
time to time in the Center, as determined in good faith by Landlord's architect
on the basis of measurement set forth in Section 3.1(d) hereof (which basis of
measurement shall be applied consistently for all buildings in the Center),
differs from the assumed numbers set forth above (including, but not limited to,
any such difference arising from the completion and occupancy of buildings in
the Center before or after the Rent Commencement Date hereunder, as contemplated
in Section 7.1(c) below), then Tenant's Operating Cost Share shall be adjusted
to reflect the actual areas so determined as they exist from time to time. In no
event, however, shall the square footage of any child care facility or
stand-alone restaurant on the Property be included as part of the square footage
of buildings on the Property in calculating Tenant's Operating Cost Share, nor
shall any costs or expenses relating to the proposed child care facility and
proposed stand-alone restaurant on the Premises be included in Operating
Expenses as hereinafter defined.

                  (c)      As Landlord constructs additional buildings in the
Center, Tenant's Operating Cost Share shall be adjusted from time to time to be
equal to the percentage determined by dividing the gross square footage of the
Building as it then exists by the gross square footage of all buildings located
in the Center (subject to the exclusion set forth in Section 7.1(b) with respect
to the proposed child care facility and proposed restaurant). In determining
such percentage, a building shall be taken into account from and after the date
on

                                      -11-
<Page>

which a tenant first enters into possession of the building or a portion
thereof; the good faith determination of the gross square footage of any such
building by Landlord's architects in a manner consistent with the manner in
which other buildings in the Center are measured shall be final and binding upon
the parties; and costs and expenses relating to a new building shall be taken
into account as Operating Expenses under this Article 7 only from and after the
date on which the square footage of the building is taken into account in
determining Tenant's Operating Cost Share under the criteria set forth in this
paragraph.

         7.2      DEFINITION OF OPERATING EXPENSES.

                  (a)      Subject to the exclusions and provisions hereinafter
contained, the term "OPERATING EXPENSES" shall mean the total costs and expenses
incurred by or allocable to Landlord for management, operation and maintenance
of the Improvements, the Property and the Center, including, without limitation,
costs and expenses of (i) insurance (including, but not limited to, earthquake
insurance and environmental insurance), property management, landscaping, and
the operation, repair and maintenance of buildings and Common Areas; (ii) all
utilities and services; (iii) real and personal property taxes and assessments
or substitutes therefor levied or assessed against the Center or any part
thereof, including (but not limited to) any possessory interest, use, business,
license or other taxes or fees, any taxes imposed directly on rents or services,
any assessments or charges for police or fire protection, housing, transit, open
space, street or sidewalk construction or maintenance or other similar services
from time to time by any governmental or quasi-governmental entity, and any
other new taxes on landlords in addition to taxes now in effect; (iv) supplies,
equipment, utilities and tools used in management, operation and maintenance of
the Center; (v) capital improvements to the Property, the Improvements or the
Center, amortized over a reasonable period, (aa) which reduce or will cause
future reduction of other items of Operating Expenses for which Tenant is
otherwise required to contribute or (bb) which are required by law, ordinance,
regulation or order of any governmental authority or (cc) of which Tenant has
use or which benefit Tenant; and (vi) any other costs (including, but not
limited to, any parking or utilities fees or surcharges not otherwise
specifically addressed elsewhere in this Lease) allocable to or paid by
Landlord, as owner of the Center or Improvements, pursuant to any applicable
laws, ordinances, regulations or orders of any governmental or
quasi-governmental authority or pursuant to the terms of any declarations of
covenants, conditions and restrictions now or hereafter affecting the Center or
any other property over which Tenant has non-exclusive usage rights as
contemplated in Section 1.1(b) hereof. Operating Expenses shall not include any
costs attributable to the work for which Landlord is required to pay under
Article 5 or the Workletter, nor any costs attributable to the initial
construction of buildings or Common Area improvements in the Center, nor any
costs attributable to buildings the square footage of which is not taken into
account in determining Tenant's Operating Cost Share under Section 7.1 for the
applicable period. The distinction between items of ordinary operating
maintenance and repair and items of a capital nature shall be made in accordance
with generally accepted accounting principles applied on a consistent basis or
in accordance with tax accounting principles, as determined in good faith by
Landlord's accountants.

                  (b)      Notwithstanding any other provisions of this Section
7.2, the following shall not be included within Operating Expenses: (i) rent
paid to any ground lessor; (ii) the cost of constructing tenant improvements for
any other tenant of the Building or the Center; (iii) the costs of special
services, goods or materials provided to any other tenant of the Building or the
Center and not offered or made available to Tenant; (iv) repairs covered by
proceeds of insurance or from funds provided by Tenant or any other tenant of
the Center, or as to which any other tenant of the Center is obligated to make
such repairs or to pay the cost thereof; (v) legal fees, advertising costs or
other related expenses incurred by Landlord in connection with the leasing of
space to individual tenants of the Center; (vi) repairs, alterations, additions,
improvements or replacements needed to rectify or correct any defects in the
original design, materials or workmanship of the Building, the Center or the
Common Areas; (vii) damage and repairs necessitated by the negligence or willful
misconduct of Landlord or of Landlord's employees, contractors or agents; (viii)
executive salaries or salaries of service personnel to the extent that such
personnel perform services other than in connection with the management,
operation, repair

                                      -12-
<Page>

or maintenance of the Building or the Center; (ix) Landlord's general overhead
expenses not related to the Building or the Center; (x) legal fees, accountants'
fees and other expenses incurred in connection with disputes with tenants or
other occupants of the Center, or in connection with the enforcement of the
terms of any leases with tenants or the defense of Landlord's title to or
interest in the Center or any part thereof; (xi) costs incurred due to a
violation by Landlord or any other tenant of the Center of the terms and
conditions of any lease; (xii) costs of any service provided to Tenant or to
other occupants of the Building or the Center for which Landlord is reimbursed
other than through recovery of Operating Expenses; (xiii) personal property
taxes due and payable by any other tenant of the Center; and (xiv) costs
incurred by Landlord pursuant to Article 15 of this Lease in connection with an
event of casualty or condemnation.

         7.3      DETERMINATION OF OPERATING EXPENSES. On or before the Rent
Commencement Date and during the last month of each calendar year of the term of
this Lease ("LEASE YEAR"), or as soon thereafter as practical, Landlord shall
provide Tenant notice of Landlord's estimate of the Operating Expenses for the
ensuing Lease Year or applicable portion thereof. On or before the first day of
each month during the ensuing Lease Year or applicable portion thereof,
beginning on the Rent Commencement Date, Tenant shall pay to Landlord Tenant's
Operating Cost Share of the portion of such estimated Operating Expenses
allocable (on a prorata basis) to such month; PROVIDED, however, that if such
notice is not given in the last month of a Lease Year, Tenant shall continue to
pay on the basis of the prior year's estimate, if any, until the month after
such notice is given. If at any time or times it appears to Landlord that the
actual Operating Expenses will vary from Landlord's estimate by more than five
percent (5%), Landlord may, by notice to Tenant, revise its estimate for such
year and subsequent payments by Tenant for such year shall be based upon such
revised estimate.

         7.4      FINAL ACCOUNTING FOR LEASE YEAR.

                  (a)      Within ninety (90) days after the close of each Lease
Year, or as soon after such 90-day period as practicable, Landlord shall deliver
to Tenant a statement of Tenant's Operating Cost Share of the Operating Expenses
for such Lease Year prepared by Landlord from Landlord's books and records,
which statement shall be final and binding on Landlord and Tenant (except as
provided in Section 7.4(b)). If on the basis of such statement Tenant owes an
amount that is more or less than the estimated payments for such Lease Year
previously made by Tenant, Tenant or Landlord, as the case may be, shall pay the
deficiency to the other party within thirty (30) days after delivery of the
statement. Failure or inability of Landlord to deliver the annual statement
within such ninety (90) day period shall not impair or constitute a waiver of
Tenant's obligation to pay Operating Expenses, or cause Landlord to incur any
liability for damages.

                  (b)      At any time within three (3) months after receipt of
Landlord's annual statement of Operating Expenses as contemplated in Section
7.4(a), Tenant shall be entitled, upon reasonable written notice to Landlord and
during normal business hours at Landlord's office or such other places as
Landlord shall designate, to inspect and examine those books and records of
Landlord relating to the determination of Operating Expenses for the immediately
preceding Lease Year covered by such annual statement or, if Tenant so elects by
written notice to Landlord, to request an independent audit of such books and
records. The independent audit of the books and records shall be conducted by a
certified public accountant reasonably acceptable to both Landlord and Tenant
or, if the parties are unable to agree, by a certified public accountant
appointed by the Presiding Judge of the San Mateo County Superior Court upon the
application of either Landlord or Tenant (with notice to the other party). In
either event, such certified public accountant shall be one who is not then
employed in any capacity by Landlord or Tenant or by any of their respective
affiliates. The audit shall be limited to the determination of the amount of
Operating Expenses for the subject Lease Year, and shall be based on generally
accepted accounting principles and tax accounting principles, consistently
applied. If it is determined, by mutual agreement of Landlord and Tenant or by
independent audit, that the amount of Operating Expenses billed to or paid by
Tenant for the applicable Lease Year was incorrect, then the appropriate party
shall pay to the other party the deficiency or overpayment, as applicable,
within thirty (30) days after the final determination of such deficiency or

                                      -13-
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overpayment, as applicable, within thirty (30) days after the final
determination of such deficiency or overpayment. All costs and expenses of
the audit shall be paid by Tenant unless the audit shows that Landlord
overstated Operating Expenses for the subject Lease Year by more than five
percent (5%), in which case Landlord shall pay all costs and expenses of the
audit. Each party agrees to maintain the confidentiality of the findings of
any audit in accordance with the provisions of this Section 7.4.

         7.5      PRORATION. If the Rent Commencement Date falls on a day other
than the first day of a Lease Year or if this Lease terminates on a day other
than the last day of a Lease Year, then the amount of Operating Expenses payable
by Tenant with respect to such first or last partial Lease Year shall be
prorated on the basis which the number of days during such Lease Year in which
this Lease is in effect bears to 365. The termination of this Lease shall not
affect the obligations of Landlord and Tenant pursuant to Section 7.4 to be
performed after such termination.

                                  8. UTILITIES

         8.1      PAYMENT. Commencing with the Rent Commencement Date and
thereafter throughout the term of this Lease, Tenant shall pay, before
delinquency, all charges for water, gas, heat, light, electricity, power, sewer,
telephone, alarm system, janitorial and other services or utilities supplied to
or consumed in or with respect to the Building (other than any separately
metered costs for water, electricity or other services or utilities furnished
with respect to the Common Areas, which costs shall be paid by Landlord and
shall constitute Operating Expenses under Section 7.2 hereof), including any
taxes on such services and utilities. It is the intention of the parties that
all such services shall be separately metered to the Building. In the event that
any of such services supplied to the Building are not separately metered, then
the amount thereof shall be an item of Operating Expenses and shall be paid as
provided in Article 7.

         8.2      INTERRUPTION. There shall be no abatement of rent or other
charges required to be paid hereunder and Landlord shall not be liable in
damages or otherwise for interruption or failure of any service or utility
furnished to or used with respect to the Building or Property because of
accident, making of repairs, alterations or improvements, severe weather,
difficulty or inability in obtaining services or supplies, labor difficulties or
any other cause. Notwithstanding the foregoing provisions of this Section 8.2,
however, in the event of any interruption or failure of any service or utility
to the Building that (i) is caused in whole or in material part by the active
negligence or willful misconduct of Landlord or its agents, employees or
contractors AND (ii) continues for more than three (3) business days AND (iii)
materially impairs Tenant's ability to use the Building for its intended purpose
hereunder, then following such three (3) business day period, Tenant's
obligations for payment of rent and other charges under this Lease shall be
abated in proportion to the degree of impairment of Tenant's use of the
Building, and such abatement shall continue until Tenant's use of the Building
is no longer materially impaired thereby.

                                      -14-
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                              9. ALTERATIONS; SIGNS

         9.1      RIGHT TO MAKE ALTERATIONS. Tenant shall make no alterations,
additions or improvements to the Building or the Property, other than interior
non-structural alterations costing less than Fifty Thousand Dollars ($50,000.00)
in the aggregate during any twelve (12) month period, without the prior written
consent of Landlord, which consent shall not be unreasonably withheld or
delayed. All such alterations, additions and improvements shall be completed
with due diligence in a first-class workmanlike manner, in compliance with plans
and specifications approved in writing by Landlord and in compliance with all
applicable laws, ordinances, rules and regulations, and to the extent Landlord's
consent is not otherwise required hereunder for such alterations, additions or
improvements, Tenant shall give prompt written notice thereof to Landlord.
Tenant shall cause any contractors engaged by Tenant for work in the Building or
on the Property to maintain public liability and property damage insurance, and
other customary insurance, with such terms and in such amounts as Landlord may
reasonably require, naming as additional insureds Landlord and any of its
members, partners, shareholders, property managers and lenders designated by
Landlord for this purpose, and shall furnish Landlord with certificates of
insurance or other evidence that such coverage is in effect. Notwithstanding any
other provisions of this Section 9.1, under no circumstances shall Tenant make
any structural alterations or improvements, or any substantial changes to the
roof or substantial equipment installations on the roof, or any substantial
changes or alterations to the building systems, without Landlord's prior written
consent (which consent shall not be unreasonably withheld or delayed). If Tenant
so requests in seeking Landlord's consent to any alterations, additions or
improvements, Landlord shall specify in granting such consent whether Landlord
intends to require that Tenant remove such alterations, additions or
improvements (or any specified portions thereof) upon expiration or termination
of this Lease.

         9.2      TITLE TO ALTERATIONS. All alterations, additions and
improvements installed in, on or about the Building or the Property (including,
but not limited to, lab benches, fume hoods, cold rooms and other similar
improvements and equipment) shall become part of the Property and shall become
the property of Landlord, unless Landlord elects to require Tenant to remove the
same upon the termination of this Lease; PROVIDED, however, that the foregoing
shall not apply to Tenant's movable furniture, equipment and trade fixtures,
except to the extent any such items are specifically identified in the
parenthetical in the initial portion of this sentence. Tenant shall promptly
repair any damage caused by its removal of any such furniture, equipment or
trade fixtures. Notwithstanding any other provisions of this Article 9, however,
(a) under no circumstances shall Tenant have any right to remove from the
Building or the Property, at the expiration or termination of this Lease, any
lab benches, fume hoods, cold rooms or other similar improvements and equipment
installed in the Building, even if such equipment and improvements were
installed by Tenant as part of Tenant's Work under the Workletter or otherwise;
and (b) if Tenant requests Landlord's written consent to any alterations,
additions or improvements under Section 9.1 hereof and, in requesting such
consent, asks that Landlord specify whether Landlord will require removal of
such alterations, additions or improvements upon termination or expiration of
this Lease, then Landlord shall not be entitled to require such removal unless
Landlord specified its intention to do so at the time of granting of Landlord's
consent to the requested alterations, additions or improvements. Without
limiting the generality of clause (b) of the preceding sentence, Tenant shall
not be required to remove upon termination or expiration of this Lease any of
the improvements constructed by Tenant as part of Tenant's Work under the
Workletter, except to the extent that Landlord, in granting its approval of the
plans and specifications for Tenant's Work under the Workletter, advises Tenant
in writing that Landlord intends to require removal of any specified elements of
such Tenant's Work upon termination or expiration of this Lease. Notwithstanding
any other provisions of this Article 9, (x) it is the intention of the parties
that Landlord shall be entitled to claim all tax attributes associated with
alterations, additions, improvements and equipment constructed or installed by
Tenant or Landlord with funds provided by Landlord pursuant to the Tenant
Improvement Allowance; and (y) it is the intention of the parties that Tenant
shall be entitled to claim, during the term of this Lease, all tax attributes
associated with alterations, additions, improvements and equipment constructed
or installed by Tenant with Tenant's own funds (and without any payment or
reimbursement by Landlord pursuant to the Tenant Improvement Allowance), despite
the fact

                                      -15-
<Page>

that the items described in this clause (y) are characterized in this Section
9.2 as becoming Landlord's property upon installation, in recognition of the
fact that Tenant will have installed and paid for such items, will have the
right of possession of such items during the term of this Lease and will have
the obligation to pay (directly or indirectly) property taxes on such items,
carry insurance on such items and bear the risk of loss with respect to such
items under Article 15 hereof. If and to the extent it becomes necessary, in
implementation of the foregoing intentions, to identify (either specifically or
on a percentage basis, as may be required under applicable tax laws) which
alterations, additions, improvements and equipment constructed as part of
Tenant's Work under the Workletter have been funded through the Tenant
Improvement Allowance and which have been constructed or installed with Tenant's
own funds, Landlord and Tenant agree to cooperate reasonably and in good faith
to make such an identification by mutual agreement.

         9.3      TENANT TRADE FIXTURES. Subject to the third sentence of
Section 9.2 and to Section 9.5 (which shall be controlling in the case of signs,
logos and insignia), Tenant may install, remove and reinstall trade fixtures
without Landlord's prior written consent, except that installation and removal
of any trade fixtures which are affixed to the Building or the Property or which
affect the exterior or structural portions of the Building or the building
systems shall require Landlord's written approval, which approval shall not be
unreasonably withheld or delayed. Tenant shall immediately repair any damage
caused by installation and removal of trade fixtures under this Section 9.3.

         9.4      NO LIENS. Tenant shall at all times keep the Building and the
Property free from all liens and claims of any contractors, subcontractors,
materialmen, suppliers or any other parties employed either directly or
indirectly by Tenant in construction work on the Building or the Property.
Tenant may contest any claim of lien, but only if, prior to such contest, Tenant
either (i) posts security in the amount of the claim, plus estimated costs and
interest, or (ii) records a bond of a responsible corporate surety in such
amount as may be required to release the lien from the Building and the
Property. Tenant shall indemnify, defend and hold Landlord harmless against any
and all liability, loss, damage, cost and other expenses, including, without
limitation, reasonable attorneys' fees, arising out of claims of any lien for
work performed or materials or supplies furnished at the request of Tenant or
persons claiming under Tenant.

         9.5      SIGNS. Tenant shall have the right to display its corporate
name, logo and/or insignia on the Building and in front of the entrance to the
Building, subject to (a) Landlord's prior approval as to location, size, design
and composition (which approval shall not be unreasonably withheld or delayed),
(b) the sign criteria established for the Center from time to time and (c) all
restrictions and requirements of applicable law and of any covenants, conditions
and restrictions or other written agreements now or hereafter applicable to the
Property. Tenant shall immediately repair any damage caused by installation and
removal of signs under this Section 9.5.

                           10. MAINTENANCE AND REPAIRS

         10.1     LANDLORD'S WORK. Landlord shall repair and maintain or cause
to be repaired and maintained the Common Areas of the Center and the roof
(structural portions only), exterior walls and other structural portions of the
Building. The cost of all work performed by Landlord under this Section 10.1
shall be an Operating Expense hereunder, except to the extent such work (i) is
required due to the negligence or willful misconduct of Landlord or its agents,
employees or contractors, (ii) involves the repair or correction of a condition
or defect that Landlord is required to correct pursuant to Section 5.2 hereof,
(iii) is a capital expense not includible as an Operating Expense under Section
7.2 hereof, or (iv) is required due to the negligence or willful misconduct of
Tenant or its agents, employees or invitees (in which event Tenant shall bear
the full cost of such work pursuant to the indemnification provided in Section
12.6 hereof, subject to the release set forth in Section 12.4 hereof). Tenant
knowingly and voluntarily waives the right to make repairs at Landlord's
expense, or to offset the cost thereof against rent, under any law, statute,
regulation or ordinance now or hereafter in effect.

                                      -16-
<Page>

         10.2     TENANT'S OBLIGATION FOR MAINTENANCE.

                  (a)      GOOD ORDER, CONDITION AND REPAIR. Except as provided
in Section 10.1 hereof, Tenant at its sole cost and expense shall keep and
maintain in good and sanitary order, condition and repair the Building and every
part thereof, wherever located, including but not limited to the roof
(non-structural portions only), signs, interior, ceiling, electrical system,
plumbing system, telephone and communications systems of the Building, the HVAC
equipment and related mechanical systems serving the Building (for which
equipment and systems Tenant shall enter into a service contract with a person
or entity designated or reasonably approved by Landlord), all doors, door
checks, windows, plate glass, door fronts, exposed plumbing and sewage and other
utility facilities, fixtures, lighting, wall surfaces, floor surfaces and
ceiling surfaces of the Building and all other interior repairs, foreseen and
unforeseen, with respect to the Building, as required.

                  (b)      LANDLORD'S REMEDY. If Tenant, after notice from
Landlord, fails to make or perform promptly any repairs or maintenance which are
the obligation of Tenant hereunder, Landlord shall have the right, but shall not
be required, to enter the Building and make the repairs or perform the
maintenance necessary to restore the Building to good and sanitary order,
condition and repair. Immediately on demand from Landlord, the cost of such
repairs shall be due and payable by Tenant to Landlord.

                  (c)      CONDITION UPON SURRENDER. At the expiration or sooner
termination of this Lease, Tenant shall surrender the Building and the
Improvements, including any additions, alterations and improvements thereto,
broom clean, in good and sanitary order, condition and repair, ordinary wear and
tear and casualty damage (the latter of which shall be governed by the
provisions of Article 15 hereof) excepted, first, however, removing all goods
and effects of Tenant and all and fixtures and items required to be removed or
specified to be removed at Landlord's election pursuant to this Lease
(including, but not limited to, any such removal required as a result of an
election duly made by Landlord to require such removal as contemplated in
Section 9.2), and repairing any damage caused by such removal. Tenant shall not
have the right to remove fixtures or equipment if Tenant is in default hereunder
unless Landlord specifically waives this provision in writing. Tenant expressly
waives any and all interest in any personal property and trade fixtures not
removed from the Property by Tenant at the expiration or termination of this
Lease, agrees that any such personal property and trade fixtures may, at
Landlord's election, be deemed to have been abandoned by Tenant, and authorizes
Landlord (at its election and without prejudice to any other remedies under this
Lease or under applicable law) to remove and either retain, store or dispose of
such property at Tenant's cost and expense, and Tenant waives all claims against
Landlord for any damages resulting from any such removal, storage, retention or
disposal.

                               11. USE OF PROPERTY

         11.1     PERMITTED USE. Subject to Sections 11.3, 11.4 and 11.6 hereof,
Tenant shall use the Building solely for a laboratory and research and
development facility, including (but not limited to) wet chemistry and biology
labs, clean rooms, storage and use of toxic and radioactive materials (subject
to the provisions of Section 11.6 hereof), storage and use of laboratory
animals, administrative offices, and other lawful purposes reasonably related to
or incidental to such specified uses (subject in each case to receipt of all
necessary approvals from the City of South San Francisco and other governmental
agencies having jurisdiction over the Building), and for no other purpose,
unless Landlord in its sole discretion otherwise consents in writing.

         11.2     REQUIREMENT OF CONTINUED USE. Tenant shall not at any time
leave the Building unoccupied or vacant, and shall continuously during the term
of this Lease (except prior to the Rent Commencement Date and during any period
when the Building is unusable by reason of events described in Article 15
hereof) conduct and carry on in the Building the use permitted hereunder.

                                      -17-
<Page>

         11.3     NO NUISANCE. Tenant shall not use the Building for or carry on
or permit upon the Property or any part thereof any nuisance or anything against
public policy, nor interfere with the rights or business of Landlord in the
Building or the Property, nor commit or allow to be committed any waste in, on
or about the Property. Tenant shall not do or permit anything to be done in or
about the Property, nor bring nor keep anything therein, which will in any way
cause the Property to be uninsurable with respect to the insurance required by
this Lease or with respect to standard fire and extended coverage insurance with
vandalism, malicious mischief and riot endorsements.

         11.4     COMPLIANCE WITH LAWS.

                  (a)      Tenant shall not use the Building or Property or
permit the Building or Property to be used in whole or in part for any purpose
or use that is in violation of any applicable laws, ordinances, regulations or
rules of any governmental agency or public authority. Tenant shall keep the
Building and Improvements equipped with all safety appliances required by law,
ordinance or insurance on the Property, or any order or regulation of any public
authority, because of Tenant's particular use of the Property. Tenant shall
procure all licenses and permits required for use of the Property. Tenant shall
use the Property in strict accordance with all applicable ordinances, rules,
laws and regulations and shall comply with all requirements of all governmental
authorities now in force or which may hereafter be in force pertaining to the
use of the Property by Tenant, including, without limitation, regulations
applicable to noise, water, soil and air pollution, and making such
nonstructural alterations and additions thereto as may be required from time to
time by such laws, ordinances, rules, regulations and requirements of
governmental authorities or insurers of the Property (collectively,
"REQUIREMENTS") because of Tenant's construction of improvements in or other
particular use of the Property. Any structural alterations or additions required
from time to time by applicable Requirements because of Tenant's construction of
improvements in the Building or other particular use of the Property shall, at
Landlord's election, either (i) be made by Tenant, at Tenant's sole cost and
expense, in accordance with the procedures and standards set forth in Section
9.1 for alterations by Tenant, or (ii) be made by Landlord at Tenant's sole cost
and expense, in which event Tenant shall pay to Landlord as additional rent,
within ten (10) days after demand by Landlord, an amount equal to all reasonable
costs incurred by Landlord in connection with such alterations or additions. The
final judgment of any court, or the admission by Tenant in any proceeding
against Tenant, that Tenant has violated any law, statute, ordinance or
governmental rule, regulation or requirement shall be conclusive of such
violation as between Landlord and Tenant.

                  (b)      In compliance with requirements imposed upon Landlord
by an Owner Participation Agreement between Landlord and The Redevelopment
Agency of the City of South San Francisco, Tenant hereby agrees to and accepts
the following provision:

                  "Tenant herein covenants by and for itself and its successors
         and assigns, and all persons claiming under or through it, and this
         Lease is made and accepted upon and subject to the conditions that
         there shall be no discrimination against or segregation of any person
         or group of persons on account of race, color, religion, creed, sex,
         marital status, ancestry or national origin in the leasing, subleasing,
         transferring, use, occupancy, tenure or enjoyment of the property
         herein leased, nor shall Tenant or any person claiming under or through
         it establish or permit any such practice or practices of discrimination
         or segregation with reference to the selection, location, number, use
         or occupancy of tenants, lessees, sublessees, subtenants or vendees in
         the property herein leased."

         11.5     LIQUIDATION SALES. Tenant shall not conduct or permit to be
conducted any auction, bankruptcy sale, liquidation sale, or going out of
business sale, in, upon or about the Property, whether said auction or sale be
voluntary, involuntary or pursuant to any assignment for the benefit of
creditors, or pursuant to any bankruptcy or other insolvency proceeding.

                                      -18-
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         11.6     ENVIRONMENTAL MATTERS.

                  (a)      For purposes of this Section, "HAZARDOUS SUBSTANCE"
shall mean the substances included within the definitions of the term "hazardous
substance" under (i) the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended, 42 U.S.C. Section 9601 ET SEQ., and the
regulations promulgated thereunder, as amended, (ii) the California
Carpenter-Presley-Tanner Hazardous Substance Account Act, California Health &
Safety Code Section 25300 ET SEQ., and regulations promulgated thereunder, as
amended, (iii) the Hazardous Materials Release Response Plans and Inventory Act,
California Heath & Safety Code Section 25500 ET SEQ., and regulations
promulgated thereunder, as amended, and (iv) petroleum; "HAZARDOUS WASTE" shall
mean (i) any waste listed as or meeting the identified characteristics of a
"hazardous waste" under the Resource Conservation and Recovery Act of 1976, 42
U.S.C. Section 6901 ET SEQ., and regulations promulgated pursuant thereto, as
amended (collectively, "RCRA"), (ii) any waste meeting the identified
characteristics of "hazardous waste," "extremely hazardous waste" or "restricted
hazardous waste" under the California Hazardous Waste Control Law, California
Health & Safety Code Section 25100 ET SEQ., and regulations promulgated pursuant
thereto, as amended (collectively, the "CHWCL"), and/or (iii) any waste meeting
the identified characteristics of "medical waste" under California Health &
Safety Code Section 25015-25027.8, and regulations promulgated thereunder, as
amended; and "HAZARDOUS WASTE FACILITY" shall mean a hazardous waste facility as
defined under the CHWCL.

                  (b)      Without limiting the generality of the obligations
set forth in Section 11.4 of this Lease:

                           (i)      Tenant shall not cause or permit any
hazardous substance or hazardous waste to be brought upon, kept, stored or used
in or about the Property without the prior written consent of Landlord, which
consent shall not be unreasonably withheld, except that Tenant, in connection
with its permitted use of the Property as provided in Section 11.1, may keep,
store and use materials that constitute hazardous substances which are customary
for such permitted use, provided such hazardous substances are kept, stored and
used in quantities which are customary for such permitted use and are kept,
stored and used in full compliance with clauses (ii) and (iii) immediately
below.

                           (ii)     Tenant shall comply with all applicable
laws, rules, regulations, orders, permits, licenses and operating plans of any
governmental authority with respect to the receipt, use, handling, generation,
transportation, storage, treatment and/or disposal of hazardous substances or
wastes by Tenant or its agents or employees, and Tenant will provide Landlord
with copies of all permits, licenses, registrations and other similar documents
that authorize Tenant to conduct any such activities in connection with its
authorized use of the Property from time to time, which copies shall be provided
initially within fifteen (15) days after the Rent Commencement Date and shall
thereafter be updated at least annually, on or before each anniversary of the
Rent Commencement Date..

                           (iii)    Tenant shall not (A) operate on or about the
Property any facility required to be permitted or licensed as a storage facility
(as defined in Section 25123.3 of the CHWCL) or as any other kind of hazardous
waste facility or for which interim status as such is required, nor (B) store
any hazardous wastes on or about the Property for ninety (90) days or more, nor
(C) conduct any other activities on or about the Property that could result in
the Property being deemed to be a "hazardous waste facility" (including, but not
limited to, any storage or treatment of hazardous substances or hazardous wastes
which could have such a result), other than temporary storage of hazardous
wastes generated in the ordinary course of Tenant's business under conditions
and for periods of time that do not require permitting or licensing of the
Property or any part thereof under the CHWCL, nor (D) store any hazardous wastes
on or about the Property in violation of any federal or California laws or in
violation of the terms of any federal or California licenses or permits held by
Tenant.

                           (iv)     Tenant shall comply with all applicable
laws, rules, regulations, orders and permits relating to underground storage
tanks installed by Tenant or its agents or

                                      -19-
<Page>

employees or at the request of Tenant (including any installation, monitoring,
maintenance, closure and/or removal of such tanks) as such tanks are defined in
California Health & Safety Code Section 25281(x), including, without limitation,
complying with California Health & Safety Code Section 25280-25299.7 and the
regulations promulgated thereunder, as amended. Tenant shall furnish to Landlord
copies of all registrations and permits issued to or held by Tenant from time to
time for any and all underground storage tanks located on or under the Property.

                           (v)      If applicable, Tenant shall provide Landlord
in writing the following information and/or documentation within fifteen (15)
days after the Rent Commencement Date, and shall update such information at
least annually, on or before each anniversary of the Rent Commencement Date, to
reflect any change in or addition to the required information and/or
documentation (PROVIDED, however, that in the case of the materials described in
subparagraphs (B), (C) and (E) below, Tenant shall not be required to deliver
copies of such materials to Landlord but shall maintain copies of such materials
to such extent and for such periods as may be required by applicable law and
shall permit Landlord or its representatives to inspect and copy such materials
during normal business hours at any time and from time to time upon reasonable
notice to Tenant):

                                    (A)      A list of all hazardous substances
and/or wastes that Tenant receives, uses, handles, generates, transports,
stores, treats or disposes of from time to time in connection with its
operations on the Property.

                                    (B)      All Material Safety Data Sheets
("MSDS'S"), if any, required to be completed with respect to operations of
Tenant at the Property from time to time in accordance with Title 26, California
Code of Regulations Section 8-5194 or 42 U.S.C. Section 11021, or any amendments
thereto, and any Hazardous Materials Inventory Sheets that detail the MSDS's.

                                    (C)      All hazardous waste manifests (as
defined in Title 26, California Code of Regulations Section 22-66481), if any,
that Tenant is required to complete from time to time in connection with its
operations at the Property.

                                    (D)      A copy of any Hazardous Materials
Management Plan required from time to time with respect to Tenant's operations
at the Property, pursuant to California Health & Safety Code Section 25500 ET
SEQ., and any regulations promulgated thereunder, as amended.

                                    (E)      Any Contingency Plans and Emergency
Procedures required of Tenant from time to time due to its operations in
accordance with Title 26, California Code of Regulations Section 22-67140 ET
SEQ., and any amendments thereto, and any Training Programs and Records required
under Title 26, California Code of Regulations, Section 22-67105, and any
amendments thereto.

                                    (F)      Copies of any biennial reports to
be furnished to the California Department of Health Services from time to time
relating to hazardous substances or wastes, pursuant to Title 26, California
Code of Regulations, Section 22-66493, and any amendments thereto.

                                    (G)      Copies of all industrial wastewater
discharge permits issued to or held by Tenant from time to time in connection
with its operations on the Property.

                                    (H)      Copies of any other lists or
inventories of hazardous substances and/or wastes on or about the Property that
Tenant is otherwise required to prepare and file from time to time with any
governmental or regulatory authority.

                           (vi)     Tenant shall secure Landlord's prior written
approval for any proposed receipt, storage, possession, use, transfer or
disposal of "radioactive materials" or "radiation," as such materials are
defined in Title 26, California Code of Regulations Section 17-30100, and/or any
other materials possessing the characteristics of the materials so defined,
which

                                      -20-
<Page>

approval Landlord shall not unreasonably withhold; PROVIDED, that such approval
shall not be required for any radioactive materials (x) for which Tenant has
secured prior written approval of the Nuclear Regulatory Commission and
delivered to Landlord a copy of such approval (if applicable), or (y) which
Tenant is authorized to use pursuant to the terms of a Radioactive Material
License (if any) issued by the State of California, provided that Tenant has
delivered a copy of such License to Landlord. Tenant, in connection with any
such authorized receipt, storage, possession, use, transfer or disposal of
radioactive materials or radiation, shall:

                                    (A)      Comply with all federal, state and
local laws, rules, regulations, orders, licenses and permits issued to or
applicable to Tenant with respect to its business operations on the Property;

                                    (B)      Maintain, to such extent and for
such periods as may be required by applicable law, and permit Landlord and its
representatives to inspect during normal business hours at any time and from
time to time upon reasonable notice to Tenant, a list of all radioactive
materials or radiation received, stored, possessed, used, transferred or
disposed of by Tenant or in connection with the operation of Tenant's business
on the Property from time to time, to the extent not already disclosed through
delivery of a copy of a Nuclear Regulatory Commission approval and/or a
California Radioactive Material License with respect thereto as contemplated
above; and

                                    (C)      Maintain, to such extent and for
such periods as may be required by applicable law, and permit Landlord or its
representatives to inspect during normal business hours at any time and from
time to time upon reasonable notice to Tenant, all licenses, registration
materials, inspection reports, governmental orders and permits in connection
with the receipt, storage, possession, use, transfer or disposal of radioactive
materials or radiation by Tenant or in connection with the operation of Tenant's
business on the Property from time to time.

                           (vii)    Tenant shall comply with any and all
applicable laws, rules, regulations and orders of any governmental authority
with respect to the release into the environment of any hazardous wastes or
substances or radiation or radioactive materials by Tenant or its agents or
employees. Tenant shall give Landlord verbal notice of any unauthorized release
of any such hazardous wastes or substances or radiation or radioactive materials
into the environment within twenty-four (24) hours of the time at which Tenant
became aware of such release, and shall follow such verbal notice with written
notice to Landlord of such release within forty-eight (48) hours of the time at
which Tenant became aware of such release.

                           (viii)   Tenant shall indemnify, defend and hold
Landlord harmless from and against any and all claims, losses (including, but
not limited to, loss of rental income), damages, liabilities, costs, legal fees
and expenses of any sort arising out of or relating to (A) any failure by Tenant
to comply with any provisions of this Section 11.6(b), or (B) any receipt, use
handling, generation, transportation, storage, treatment, release and/or
disposal of any hazardous substance or waste or any radioactive material or
radiation on or about the Property as a proximate result of Tenant's use of the
Property or as a result of any intentional or negligent acts or omissions of
Tenant or of any agent, employee or invitee of Tenant.

                           (ix)     Tenant shall cooperate with Landlord in
furnishing Landlord with complete information regarding Tenant's receipt,
handling, use, storage, transportation, generation, treatment and/or disposal of
any hazardous substances or wastes or radiation or radioactive materials. Upon
request, Tenant shall grant Landlord reasonable access at reasonable times to
the Property to inspect Tenant's receipt, handling, use, storage,
transportation, generation, treatment and/or disposal of hazardous substances or
wastes or radiation or radioactive materials, without being deemed guilty of any
disturbance of Tenant's use or possession and without being liable to Tenant in
any manner.

                           (x)      Notwithstanding Landlord's rights of
inspection and review under this Section 11.6(b), Landlord shall have no
obligation or duty to so inspect or review, and no

                                      -21-
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third party shall be entitled to rely on Landlord to conduct any sort of
inspection or review by reason of the provisions of this Section 11.6(b).

                           (xi)     If Tenant or its employees, agents,
contractors, vendors, customers or guests receive, handle, use, store,
transport, generate, treat and/or dispose of any hazardous substances or wastes
or radiation or radioactive materials on or about the Property at any time
during the term of this Lease, then within thirty (30) days after the
termination or expiration of this Lease, Tenant shall, at Tenant's sole cost and
expense, obtain and deliver to Landlord an environmental study, performed by an
expert reasonably satisfactory to Landlord, evaluating the presence or absence
of hazardous substances and wastes, radiation and radioactive materials in, on,
under and about the Building, including (but not limited to) areas of the
Property outside the Building which the expert determines, based on reasonable
inquiry and investigation, to have a reasonable possibility of having been
affected by a release of hazardous substances or wastes or of radiation or
radioactive materials related to or arising in connection with Tenant's
occupancy of the Building and/or the conduct of Tenant's business on and about
the Property. Such study shall be based on a reasonable and prudent level of
tests and investigations of the Building and, to the extent contemplated in the
preceding sentence, any other appropriate areas of the Property, which tests
shall be conducted no earlier than the date of termination or expiration of this
Lease. Liability for any remedial actions required or recommended on the basis
of such study shall be allocated in accordance with Sections 11.4, 11.6, 12.6
and other applicable provisions of this Lease. Notwithstanding the foregoing,
Tenant's liability for costs of inspection, testing and cleanup for hazardous
substances, hazardous wastes and/or radiation or radioactive materials shall be
limited to costs arising out of or in connection with or otherwise attributable
to the receipt, handling, use, storage, transportation, generation, treatment
and/or disposal of any such hazardous substances, hazardous wastes, radiation
and/or radioactive materials in, on, under or about the Building by Tenant or
its employees, agents, contractors, vendors, customers, guests or any other
parties whose activities or presence on or about the Property are related to or
arise in connection with Tenant's occupancy of the Building. The parties
acknowledge that nothing in this Section 11.6 is intended to impose on Tenant
any responsibility or liability for any hazardous substances or wastes or
radiation or radioactive materials present on the Property as of the Rent
Commencement Date (other than as a result of any intentional or negligent acts
or omissions of Tenant or of any agent, employee or invitee of Tenant), but also
acknowledge that nothing in the preceding portion of this sentence or in Section
11.6(c) is intended to exculpate Tenant from responsibility or liability for any
exacerbation of any such pre-existing conditions as a result of any breach of
Tenant's obligations under this Section 11.6 or any breach by Tenant or its
employees, agents or contractors of the provisions of the Environmental
Restriction as defined in Section 17.4 hereof.

                  (c)      Landlord shall indemnify, defend and hold Tenant
harmless from and against any and all claims, losses, damages, liabilities,
costs, legal fees and expenses of any sort arising out of or relating to (i) the
presence on the Property of any hazardous substances or wastes or radiation or
radioactive materials, including, but not limited to, "known conditions" as
defined in the RWQCB Mutual Release and Covenant Not to Sue dated July 12, 2000,
present on the Property as of the Rent Commencement Date (other than as a result
of any intentional or negligent acts or omissions of Tenant or of any agent,
employee or invitee of Tenant), and/or (ii) any unauthorized release into the
environment (including, but not limited to, the Property) of any hazardous
substances or wastes or radiation or radioactive materials to the extent such
release results from the negligence of or willful misconduct or omission by
Landlord or its agents or employees.

                  (d)      The provisions of this Section 11.6 shall survive the
termination of this Lease.

                                      -22-
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                           12. INSURANCE AND INDEMNITY

         12.1     INSURANCE.

                  (a)      Tenant shall procure and maintain in full force and
effect at all times during the term of this Lease, at Tenant's cost and expense,
commercial general liability insurance to protect against liability to the
public, or to any invitee of Tenant or Landlord, arising out of or related to
the use of or resulting from any accident occurring in, upon or about the
Property, with limits of liability of not less than (i) Two Million Dollars
($2,000,000.00) for injury to or death of one person, (ii) Five Million Dollars
($5,000,000.00) for personal injury or death, per occurrence, and (iii) One
Million Dollars ($1,000,000.00) for property damage, or combined single limit of
liability of not less than Five Million Dollars ($5,000,000.00). Such insurance
shall name Landlord, its Manager, its property manager and any lender holding a
deed of trust on the Property from time to time (as designated in writing by
Landlord to Tenant from time to time) as additional insureds thereunder. The
amount of such insurance shall not be construed to limit any liability or
obligation of Tenant under this Lease. Tenant shall also procure and maintain in
full force and effect at all times during the term of this Lease, at Tenant's
cost and expense, products/completed operations coverage on terms and in amounts
(A) customary in Tenant's industry for companies engaged in the marketing of
products on a scale comparable to that in which Tenant is engaged from time to
time and (B) mutually satisfactory to Landlord and Tenant in their respective
reasonable discretion.

                  (b)      Landlord shall procure and maintain in full force and
effect at all times during the term of this Lease, at Landlord's cost and
expense (but reimbursable as an Operating Expense under Section 7.2 hereof),
commercial general liability insurance to protect against liability arising out
of or related to the use of or resulting from any accident occurring in, upon or
about the Property, with combined single limit of liability of not less than
Five Million Dollars ($5,000,000.00) per occurrence for bodily injury and
property damage.

                  (c)      Landlord shall procure and maintain in full force and
effect at all times during the term of this Lease, at Landlord's cost and
expense (but reimbursable as an Operating Expense under Section 7.2 hereof),
policies of property insurance providing protection against "all risk of direct
physical loss" (as defined by and detailed in the Insurance Service Office's
Commercial Property Program "Cause of Loss--Special Form [CP1030]" or its
equivalent) for the Building Shell (as defined in the Workletter) and for the
improvements in the Common Areas of the Property, on a full replacement cost
basis (with no co-insurance or, if coverage without co-insurance is not
reasonably available, then on an "agreed amount" basis). Such insurance shall
include earthquake coverage and shall have such commercially reasonable
deductibles (not to exceed Fifteen Thousand Dollars ($15,000) per occurrence,
except for earthquake and environmental insurance, which may have higher
commercially reasonable deductibles consistent with conditions and practices
generally prevailing in the markets for such insurance) and other terms as
Landlord in its reasonable discretion determines to be appropriate. Landlord
shall have no obligation to carry property damage insurance for any alterations,
additions or improvements installed by Tenant in the Building or on or about the
Property.

                  (d)      Tenant shall procure and maintain in full force and
effect at all times during the term of this Lease, at Tenant's cost and expense,
policies of property insurance providing protection against "all risk of direct
physical loss" (as defined by and detailed in the Insurance Service Office's
Commercial Property Program "Cause of Loss-Special Form [CP1030]" or its
equivalent) for the Tenant Improvements constructed by Tenant pursuant to the
Workletter and on all other alterations, additions and improvements installed by
Tenant from time to time in or about the Building, on a full replacement cost
basis (with no co-insurance or, if coverage without co-insurance is not
reasonably available, then on an "agreed amount" basis). Such insurance may have
such commercially reasonable deductibles (not to exceed Fifteen Thousand Dollars
($15,000) per occurrence, except for earthquake and environmental insurance, if
any, which may have higher commercially reasonable deductibles consistent with
conditions and practices generally prevailing in the markets for such insurance)
and other terms as Tenant in its reasonable discretion determines to be
appropriate, and shall name both Tenant and Landlord

                                      -23-
<Page>

as insureds as their interests may appear. Without limiting the generality of
the foregoing provisions, Tenant's property insurance on the Tenant Improvements
shall in all events include earthquake insurance in an amount at least equal to
the amount of the Tenant Improvement Allowance paid by Landlord pursuant to the
Workletter in connection with the construction of the Tenant Improvements.

                  (e)      During the course of construction of the improvements
being constructed by Landlord and Tenant under Section 5.1 and the Workletter,
Landlord and Tenant respectively shall each procure and maintain in full force
and effect, at its respective sole cost and expense, policies of builder's risk
insurance on the improvements respectively being constructed by it, in such
amounts and with such commercially reasonable deductibles and other terms as
Landlord in its reasonable discretion determines to be appropriate with respect
to the insurance to be maintained by Landlord, and in such amounts and with such
commercially reasonable deductibles and other terms as Landlord and Tenant may
mutually and reasonably determine to be appropriate with respect to the
insurance to be maintained by Tenant. Without limiting the generality of the
foregoing provisions, Tenant's builder's risk insurance with respect to the
Tenant Improvements shall in all events include earthquake insurance in an
amount at least equal to the cumulative amount of the Tenant Improvement
Allowance paid from time to time by Landlord pursuant to the Workletter in
connection with the construction of the Tenant Improvements.

         12.2     QUALITY OF POLICIES AND CERTIFICATES. All policies of
insurance required hereunder shall be issued by responsible insurers and, in the
case of policies carried or required to be carried by Tenant, shall be written
as primary policies not contributing with and not in excess of any coverage that
Landlord may carry. Tenant shall deliver to Landlord copies of policies or
certificates of insurance showing that said policies are in effect. The coverage
provided by such policies shall include the clause or endorsement referred to in
Section 12.4. If Tenant fails to acquire, maintain or renew any insurance
required to be maintained by it under this Article 12 or to pay the premium
therefor, then Landlord, at its option and in addition to its other remedies,
but without obligation so to do, may procure such insurance, and any sums
expended by it to procure any such insurance on behalf of or in place of Tenant
shall be repaid upon demand, with interest as provided in Section 3.2 hereof.
Tenant shall give Landlord at least thirty (30) days prior written notice of any
cancellation or nonrenewal of insurance required to be maintained under this
Article 12, and shall obtain written undertakings from each insurer under
policies required to be maintained by it to endeavor to notify all insureds
thereunder at least thirty (30) days prior to cancellation of coverage.

         12.3     WORKERS' COMPENSATION. Tenant shall maintain in full force and
effect during the term of this Lease workers' compensation insurance in at least
the minimum amounts required by law, covering all of Tenant's employees working
on the Property.

         12.4     WAIVER OF SUBROGATION. To the extent permitted by law and
without affecting the coverage provided by insurance required to be maintained
hereunder, Landlord and Tenant each waive any right to recover against the other
with respect to (i) damage to property, (ii) damage to the Property or any part
thereof, or (iii) claims arising by reason of any of the foregoing, but only to
the extent that any of the foregoing damages and claims under clauses (i)-(iii)
hereof are covered, and only to the extent of such coverage, by property
insurance actually carried or required to be carried hereunder by either
Landlord or Tenant. This provision is intended to waive fully, and for the
benefit of each party, any rights and claims which might give rise to a right of
subrogation in any insurance carrier. Each party shall procure a clause or
endorsement on any property insurance policy denying to the insurer rights of
subrogation against the other party to the extent rights have been waived by the
insured prior to the occurrence of injury or loss. Coverage provided by
insurance maintained by Tenant shall not be limited, reduced or diminished by
virtue of the subrogation waiver herein contained.

         12.5     INCREASE IN PREMIUMS. Tenant shall do all acts and pay all
expenses necessary to insure that the Building is not used for purposes
prohibited by any applicable fire insurance, and that Tenant's use of the
Building and Property complies with all requirements necessary to

                                      -24-
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obtain any such insurance. If Tenant uses or permits the Building or Property to
be used in a manner which increases the existing rate of any insurance carried
by Landlord on the Center and such use continues for longer than a reasonable
period specified in any written notice from Landlord to Tenant identifying the
rate increase and the factors causing the same, then Tenant shall pay the amount
of the increase in premium caused thereby, and Landlord's costs of obtaining
other replacement insurance policies, including any increase in premium, within
ten (10) days after demand therefor by Landlord.

         12.6     INDEMNIFICATION.

                  (a)      Except as otherwise expressly provided for in this
Lease, Tenant shall indemnify, defend and hold Landlord and its members,
partners, shareholders, officers, directors, agents, employees and contractors
harmless from any and all liability for injury to or death of any person, or
loss of or damage to the property of any person, and all actions, claims,
demands, costs (including, without limitation, reasonable attorneys' fees),
damages or expenses of any kind arising therefrom which may be brought or made
against Landlord or which Landlord may pay or incur by reason of the use,
occupancy and enjoyment of the Property by Tenant or any invitees, sublessees,
licensees, assignees, employees, agents or contractors of Tenant or holding
under Tenant (including, but not limited to, any such matters arising out of or
in connection with any early entry upon the Property by Tenant pursuant to
Section 2.2 hereof) from any cause whatsoever other than negligence or willful
misconduct or omission by Landlord or its agents, employees or contractors.
Landlord and its members, partners, shareholders, officers, directors, agents,
employees and contractors shall not be liable for, and Tenant hereby waives all
claims against such persons for, damages to goods, wares and merchandise in or
upon the Property, or for injuries to Tenant, its agents or third persons in or
upon the Property, from any cause whatsoever other than negligence or willful
misconduct or omission by Landlord or its agents, employees or contractors.
Tenant shall give prompt notice to Landlord of any casualty or accident in, on
or about the Property.

                  (b)      Except as otherwise expressly provided for in this
Lease, Landlord shall indemnify, defend and hold Tenant and its partners,
shareholders, officers, directors, agents, employees and contractors harmless
from any and all liability for injury to or death of any person, or loss of or
damage to the property of any person, and all actions, claims, demands, costs
(including, without limitation, reasonable attorneys' fees), damages or expenses
of any kind arising therefrom which may be brought or made against Tenant or
which Tenant may pay or incur, to the extent such liabilities or other matters
arise in, on or about the Property by reason of any negligence or willful
misconduct or omission by Landlord or its agents, employees or contractors.

         12.7     BLANKET POLICY. Any policy required to be maintained hereunder
may be maintained under a so-called "blanket policy" insuring other parties and
other locations so long as the amount of insurance required to be provided
hereunder is not thereby diminished. Without limiting the generality of the
requirement set forth at the end of the preceding sentence, property insurance
provided under a blanket policy shall provide full replacement cost coverage and
liability insurance provided under a blanket policy shall include per location
aggregate limits meeting or exceeding the limits required under this Article 12.

                                      -25-
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                           13. SUBLEASE AND ASSIGNMENT

         13.1     ASSIGNMENT AND SUBLEASE OF BUILDING. Except in the case of a
Permitted Transfer, Tenant shall not have the right or power to assign its
interest in this Lease, or make any sublease of the Building or any portion
thereof, nor shall any interest of Tenant under this Lease be assignable
involuntarily or by operation of law, without on each occasion obtaining the
prior written consent of Landlord, which consent shall not be unreasonably
withheld or delayed. Any purported sublease or assignment of Tenant's interest
in this Lease requiring but not having received Landlord's consent thereto (to
the extent such consent is required hereunder) shall be void. Without limiting
the generality of the foregoing provisions, Landlord may withhold consent to any
proposed subletting or assignment solely on the ground, if applicable, that the
use by the proposed subtenant or assignee is reasonably likely to be
incompatible with Landlord's use of the balance of the Property or of any
adjacent property owned or operated by Landlord. Except in the case of a
Permitted Transfer, any dissolution, consolidation, merger or other
reorganization of Tenant, or any sale or transfer of substantially all of the
stock or assets of Tenant in a single transaction or series of related
transactions, shall be deemed to be an assignment hereunder and shall be void
without the prior written consent of Landlord as required above. Notwithstanding
the foregoing, (i) no issuance or sale of Tenant's capital stock through any
public securities exchange nor any other issuance of Tenant's capital stock for
bona fide financing purposes shall be deemed to be an assignment, subletting or
transfer hereunder; and (ii) Tenant shall have the right to assign this Lease or
sublet the Building, or any portion thereof, without Landlord's consent (but
with prior or concurrent written notice by Tenant to Landlord), to any Affiliate
of Tenant, or to any entity which results from a merger or consolidation with
Tenant, or to any entity which acquires substantially all of the stock or assets
of Tenant as a going concern (hereinafter each a "PERMITTED TRANSFER"). For
purposes of the preceding sentence, an "AFFILIATE" of Tenant shall mean any
entity in which Tenant owns at least a fifty percent (50%) equity interest, any
entity which owns at least a fifty percent (50%) equity interest in Tenant,
and/or any entity which is related to Tenant by a chain of ownership interests
involving at least a fifty percent (50%) equity interest at each level in the
chain. Landlord shall have no right to terminate this Lease in connection with,
and shall have no right to any sums or other economic consideration resulting
from, any Permitted Transfer. Except as expressly set forth in this Section
13.1, however, the provisions of Section 13.2 shall remain applicable to any
Permitted Transfer and the transferee under such Permitted Transfer shall be and
remain subject to all of the terms and provisions of this Lease. Notwithstanding
any other provision in this Lease, any transferee under a Permitted Transfer
shall be entitled to exercise the option to extend the term of this Lease as set
forth in Section 2.6 above and the right of first offer as set forth in Section
1.3 above.

         13.2     RIGHTS OF LANDLORD.

                  (a)      Consent by Landlord to one or more assignments of
this Lease, or to one or more sublettings of the Building or any portion
thereof, or collection of rent by Landlord from any assignee or sublessee, shall
not operate to exhaust Landlord's rights under this Article 13, nor constitute
consent to any subsequent assignment or subletting. No assignment of Tenant's
interest in this Lease and no sublease shall relieve Tenant of its obligations
hereunder, notwithstanding any waiver or extension of time granted by Landlord
to any assignee or sublessee, or the failure of Landlord to assert its rights
against any assignee or sublessee, and regardless of whether Landlord's consent
thereto is given or required to be given hereunder. In the event of a default by
any assignee, sublessee or other successor of Tenant in the performance of any
of the terms or obligations of Tenant under this Lease, Landlord may proceed
directly against Tenant without the necessity of exhausting remedies against any
such assignee, sublessee or other successor. In addition, Tenant immediately and
irrevocably assigns to Landlord, as security for Tenant's obligations under this
Lease, all rent from any subletting of all or a part of the Building as
permitted under this Lease, and Landlord, as Tenant's assignee and as
attorney-in-fact for Tenant, or any receiver for Tenant appointed on Landlord's
application, may collect such rent and apply it toward Tenant's obligations
under this Lease; except that, until the occurrence of an act of default by
Tenant, Tenant shall have the right to collect such rent and to retain all
sublease profits (subject to the provisions of Section 13.2(c), below).

                                      -26-
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                  (b)      Upon any assignment of Tenant's interest in this
Lease for which Landlord's consent is required under Section 13.1 hereof,
Tenant shall pay to Landlord, within ten (10) days after receipt thereof by
Tenant from time to time, one-half (1/2) of all cash sums and other economic
considerations received by Tenant in connection with or as a result of such
assignment, after first deducting therefrom (i) any costs incurred by Tenant
for leasehold improvements (including, but not limited to, third-party
architectural and space planning costs) in the Building in connection with
such assignment, amortized over the remaining term of this Lease, and (ii)
any reasonable real estate commissions and/or reasonable attorneys' fees
incurred by Tenant in connection with such assignment.

                  (c)      Upon any sublease of all or any portion of the
Building for which Landlord's consent is required under Section 13.1 hereof,
Tenant shall pay to Landlord, within ten (10) days after receipt thereof by
Tenant from time to time, one-half (1/2) of all cash sums and other economic
considerations received by Tenant in connection with or as a result of such
sublease, after first deducting therefrom (i) the minimum rental due hereunder
for the corresponding period, prorated (on the basis of the average
per-square-foot cost paid by Tenant for the entire Building for the applicable
period under this Lease) to reflect the size of the subleased portion of the
Building, (ii) any costs incurred by Tenant for leasehold improvements in the
subleased portion of the Building (including, but not limited to, third-party
architectural and space planning costs) for the specific benefit of the
sublessee in connection with such sublease, amortized over the remaining term of
this Lease, and (iii) any reasonable real estate commissions and/or reasonable
attorneys' fees incurred by Tenant in connection with such sublease, amortized
over the term of such sublease.

                     14. RIGHT OF ENTRY AND QUIET ENJOYMENT

         14.1     RIGHT OF ENTRY. Landlord and its authorized representatives
shall have the right to enter the Building at any time during the term of this
Lease during normal business hours and upon not less than twenty-four (24) hours
prior notice, except in the case of emergency (in which event no notice shall be
required and entry may be made at any time), for the purpose of inspecting and
determining the condition of the Building or for any other proper purpose
including, without limitation, to make repairs, replacements or improvements
which Landlord may deem necessary, to show the Building to prospective
purchasers, to show the Building to prospective tenants (but only during the
final year of the term of this Lease), and to post notices of nonresponsibility.
Landlord shall not be liable for inconvenience, annoyance, disturbance, loss of
business, quiet enjoyment or other damage or loss to Tenant by reason of making
any repairs or performing any work upon the Building or the Property or by
reason of erecting or maintaining any protective barricades in connection with
any such work, and the obligations of Tenant under this Lease shall not thereby
be affected in any manner whatsoever, PROVIDED, however, Landlord shall use
reasonable efforts to minimize the inconvenience to Tenant's normal business
operations caused thereby.

         14.2     QUIET ENJOYMENT. Landlord covenants that Tenant, upon paying
the rent and performing its obligations hereunder and subject to all the terms
and conditions of this Lease, shall peacefully and quietly have, hold and enjoy
the Building and the Property throughout the term of this Lease, or until this
Lease is terminated as provided by this Lease.

                                      -27-
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                             15. CASUALTY AND TAKING

         15.1     DAMAGE OR DESTRUCTION.

                  (a)      If the Building, or the Common Areas of the Property
necessary for Tenant's use and occupancy of the Building, are damaged or
destroyed in whole or in part under circumstances in which (i) repair and
restoration is permitted under applicable governmental laws, regulations and
building codes then in effect and (ii) repair and restoration reasonably can be
completed within a period of one (1) year following the date of the occurrence
(or, in the case of an occurrence during the last year of the term of this
Lease, within a period of sixty (60) days following the date of the occurrence,
PROVIDED that the provisions of this parenthetical shall not apply if, within
ten (10) days after receipt of a termination notice from Landlord based on an
occurrence during the last year of the term of this Lease which cannot be
repaired within 60 days, Tenant properly exercises a valid renewal right (if any
then remains) under Section 2.6 hereof, and PROVIDED FURTHER, that no such
attempted exercise of a renewal right by Tenant shall be sufficient to defeat
Landlord's termination notice if the applicable damage or destruction cannot
reasonably be expected to be repaired within one year), then Landlord, as to the
Common Areas of the Property and the Building Shell, and Tenant, as to the
Tenant Improvements constructed by Tenant, shall commence and complete, with all
due diligence and as promptly as is reasonably practicable under the conditions
then existing, all such repair and restoration as may be required to return the
affected portions of the Property to a condition comparable to that existing
immediately prior to the occurrence. In the event of damage or destruction the
repair of which is not permitted under applicable governmental laws, regulations
and building codes then in effect, if such damage or destruction (despite being
corrected to the extent then permitted under applicable governmental laws,
regulations and building codes) would still materially impair Tenant's ability
to conduct its business in the Building, then either party may terminate this
Lease as of the date of the occurrence by giving written notice to the other
within thirty (30) days after the date of the occurrence; if neither party
timely elects such termination, or if such damage or destruction does not
materially impair Tenant's ability to conduct its business in the Building, then
this Lease shall continue in full force and effect, except that there shall be
an equitable adjustment in monthly minimum rental and of Tenant's Operating Cost
Share of Operating Expenses, based upon the extent to which Tenant's ability to
conduct its business in the Building is impaired, and Landlord and Tenant
respectively shall restore the Common Areas and Building Shell and the Tenant
Improvements to a complete architectural whole and to a functional condition. In
the event of damage or destruction which cannot reasonably be repaired within
one (1) year following the date of the occurrence (or, in the case of an
occurrence during the last year of the term of this Lease, within a period of
sixty (60) days following the date of the occurrence, subject to the provisos
set forth in the parallel provision of the first sentence of this paragraph),
then either Landlord or Tenant, at its election, may terminate this Lease as of
the date of the occurrence by giving written notice to the other within thirty
(30) days after the date of the occurrence; if neither party timely elects such
termination, then this Lease shall continue in full force and effect and
Landlord and Tenant shall each repair and restore applicable portions of the
Property in accordance with the first sentence of this Section 15.1(a).

                  (b)      The respective obligations of Landlord and Tenant
pursuant to Section 15.1(a) are subject to the following limitations:

                           (i)      If the occurrence results from a peril which
is required to be insured pursuant to Section 12.1(c) and (d) above, the
obligations of either party shall not exceed the amount of insurance proceeds
received from insurers (or, in the case of any failure to maintain required
insurance, proceeds that reasonably would have been available if the required
insurance had been maintained) by reason of such occurrence, plus the amount of
the party's permitted deductible (PROVIDED that each party shall be obligated to
use its best efforts to recover any available proceeds from the insurance which
it is required to maintain pursuant to the provisions of Section 12.1(c) or (d),
as applicable), and, if such proceeds (including, in the case of a failure to
maintain required insurance, any proceeds that reasonably would have been
available) are insufficient, either party may terminate the Lease unless the
other party promptly elects and agrees, in writing, to contribute the amount of
the shortfall; and

                                      -28-
<Page>

                           (ii)     If the occurrence results from a peril which
is not required to be insured pursuant to Section 12.1(c) and (d) above and is
not actually insured, Landlord shall be required to repair and restore the
Building Shell and Common Areas to the extent necessary for Tenant's continued
use and occupancy of the Building, and Tenant shall be required to repair and
restore the Tenant Improvements to the extent necessary for Tenant's continued
use and occupancy of the Building, PROVIDED that each party's obligation to
repair and restore shall not exceed an amount equal to twenty percent (20%) of
the replacement cost of the Building Shell and Common Area improvements, as to
Landlord, or twenty percent (20%) of the replacement cost of the Tenant
Improvements, as to Tenant; if the replacement cost as to either party exceeds
such amount, then the party whose limit has been exceeded may terminate this
Lease unless the other party promptly elects and agrees, in writing, to
contribute the amount of the shortfall.

                  (c)      If this Lease is terminated pursuant to the foregoing
provisions of this Section 15.1 following an occurrence which is a peril
actually insured or required to be insured against pursuant to Section 12.1(c)
and (d), Landlord and Tenant agree (and any Lender shall be asked to agree) that
such insurance proceeds shall be allocated between Landlord and Tenant in a
manner which fairly and reasonably reflects their respective ownership rights
under this Lease, as of the termination or expiration of the term of this Lease,
with respect to the improvements, fixtures, equipment and other items to which
such insurance proceeds are attributable.

                  (d)      From and after the date of an occurrence resulting in
damage to or destruction of the Building or of the Common Areas necessary for
Tenant's use and occupancy of the Building, and continuing until repair and
restoration thereof are completed, there shall be an equitable abatement of
minimum rental and of Tenant's Operating Cost Share of Operating Expenses based
upon the degree to which Tenant's ability to conduct its business in the
Building is impaired.

         15.2     CONDEMNATION.

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                  (a)      If during the term of this Lease the Building,
Property or Improvements, or any substantial part of any of them, is taken by
eminent domain or by reason of any public improvement or condemnation
proceeding, or in any manner by exercise of the right of eminent domain
(including any transfer in avoidance of an exercise of the power of eminent
domain), or receives irreparable damage by reason of anything lawfully done
under color of public or other authority, then (i) this Lease shall terminate as
to the entire Building at Landlord's election by written notice given to Tenant
within thirty (30) days after the taking has occurred, and (ii) this Lease shall
terminate as to the entire Building at Tenant's election, by written notice
given to Landlord within thirty (30) days after the nature and extent of the
taking have been finally determined, if the portion of the Building taken is of
such extent and nature as substantially to handicap, impede or permanently
impair Tenant's use of the balance of the Building. If Tenant elects to
terminate this Lease, Tenant shall also notify Landlord of the date of
termination, which date shall not be earlier than thirty (30) days nor later
than ninety (90) days after Tenant has notified Landlord of Tenant's election to
terminate, except that this Lease shall terminate on the date of taking if such
date falls on any date before the date of termination designated by Tenant. If
neither party elects to terminate this Lease as hereinabove provided, this Lease
shall continue in full force and effect (except that there shall be an equitable
abatement of minimum rental and of Tenant's Operating Cost Share of Operating
Expenses based upon the degree to which Tenant's ability to conduct its business
in the Building is impaired), Landlord shall restore the Building Shell and
Common Area improvements to a complete architectural whole and a functional
condition and as nearly as reasonably possible to the condition existing before
the taking, and Tenant shall restore the Tenant Improvements and Tenant's other
alterations, additions and improvements to a complete architectural whole and a
functional condition and as nearly as reasonably possible to the condition
existing before the taking. In connection with any such restoration, each party
shall use its respective best efforts (including, without limitation, any
necessary negotiation or intercession with its respective lender, if any) to
ensure that any severance damages or other condemnation awards intended to
provide compensation for rebuilding or restoration costs are promptly collected
and made available to Landlord and Tenant in portions reasonably corresponding
to the cost and scope of their respective restoration obligations, subject only
to such payment controls as either party or its lender may reasonably require in
order to ensure the proper application of such proceeds toward the restoration
of the Improvements. Each party waives the provisions of Code of Civil Procedure
Section 1265.130, allowing either party to petition the Superior Court to
terminate this Lease in the event of a partial condemnation of the Building or
Property.

                  (b)      The respective obligations of Landlord and Tenant
pursuant to Section 15.2(a) are subject to the following limitations:

                           (i)      Each party's obligation to repair and
restore shall not exceed, net of any condemnation awards or other proceeds
available for and allocable to such restoration as contemplated in Section
15.2(a), an amount equal to twenty percent (20%) of the replacement cost of the
Building Shell and Common Area improvements, as to Landlord, or twenty percent
(20%) of the replacement cost of the Tenant Improvements, as to Tenant; if the
replacement cost as to either party exceeds such amount, then the party whose
limit has been exceeded may terminate this Lease unless the other party promptly
elects and agrees, in writing, to contribute the amount of the shortfall; and

                           (ii)     If this Lease is terminated pursuant to the
foregoing provisions of this Section 15.2, or if this Lease remains in effect
but any condemnation awards or other proceeds become available as compensation
for the loss or destruction of any of the Improvements, then Landlord and Tenant
agree (and any Lender shall be asked to agree) that such proceeds shall be
allocated between Landlord and Tenant, respectively, in the respective
proportions in which Landlord and Tenant would have shared, under Section
15.1(c), the proceeds of any insurance proceeds following loss or destruction of
the applicable Improvements by an insured casualty.

         15.3     RESERVATION OF COMPENSATION. Landlord reserves, and Tenant
waives and assigns to Landlord, all rights to any award or compensation for
damage to the Improvements, the

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Property and the leasehold estate created hereby, accruing by reason of any
taking in any public improvement, condemnation or eminent domain proceeding or
in any other manner by exercise of the right of eminent domain or of anything
lawfully done by public authority, except that (a) Tenant shall be entitled to
any and all compensation or damages paid for or on account of Tenant's moving
expenses, trade fixtures and equipment and any leasehold improvements installed
by Tenant in the Building at its own sole expense, but only to the extent Tenant
would have been entitled to remove such items at the expiration of the term of
this Lease and then only to the extent of the then remaining unamortized value
of such improvements computed on a straight-line basis over the term of this
Lease, and (b) any condemnation awards or proceeds described in Section
15.2(b)(ii) shall be allocated and disbursed in accordance with the provisions
of Section 15.2(b)(ii), notwithstanding any contrary provisions of this Section
15.3.

         15.4     RESTORATION OF IMPROVEMENTS. In connection with any repair or
restoration of Improvements by either party following a casualty or taking as
hereinabove set forth, the party responsible for such repair or restoration
shall, to the extent possible, return such Improvements to a condition
substantially equal to that which existed immediately prior to the casualty or
taking. To the extent such party wishes to make material modifications to such
Improvements, such modifications shall be subject to the prior written approval
of the other party (not to be unreasonably withheld or delayed), except that no
such approval shall be required for modifications that are required by
applicable governmental authorities as a condition of the repair or restoration,
unless such required modifications would impair or impede Tenant's conduct of
its business in the Building (in which case any such modifications in Landlord's
work shall require Tenant's consent, not unreasonably withheld or delayed) or
would materially and adversely affect the exterior appearance, the structural
integrity or the mechanical or other operating systems of the Building (in which
case any such modifications in Tenant's work shall require Landlord's consent,
not unreasonably withheld or delayed).

                                   16. DEFAULT

         16.1     EVENTS OF DEFAULT. The occurrence of any of the following
shall constitute an event of default on the part of Tenant:

                  (a)      ABANDONMENT. Abandonment of the Building.
"ABANDONMENT" is hereby defined to include, but is not limited to, any absence
by Tenant from the Building for fifteen (15) consecutive days or more while
Tenant is in default under any other provision of this Lease. Tenant waives any
right Tenant may have to notice under Section 1951.3 of the California Civil
Code, the terms of this subsection (a) being deemed such notice to Tenant as
required by said Section 1951.3;

                  (b)      NONPAYMENT. Failure to pay, when due, any amount
payable to Landlord hereunder, such failure continuing for a period of five (5)
business days after written notice of such failure; PROVIDED, however, that any
such notice shall be in lieu of, and not in addition to, any notice required
under California Code of Civil Procedure Section 1161 ET SEQ., as amended from
time to time;

                  (c)      OTHER OBLIGATIONS. Failure to perform any obligation,
agreement or covenant under this Lease other than those matters specified in
subsection (b) hereof, such failure continuing for fifteen (15) days after
written notice of such failure; PROVIDED, however, that if such failure is
curable in nature but cannot reasonably be cured within such 15-day period, then
Tenant shall not be in default if, and so long as, Tenant promptly (and in all
events within such 15-day period) commences such cure and thereafter diligently
pursues such cure to completion; and PROVIDED FURTHER, however, that any such
notice shall be in lieu of, and not in addition to, any notice required under
California Code of Civil Procedure Section 1161 ET SEQ., as amended from time to
time;

                  (d)      GENERAL ASSIGNMENT. A general assignment by Tenant
for the benefit of creditors;

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                  (e)      BANKRUPTCY. The filing of any voluntary petition in
bankruptcy by Tenant, or the filing of an involuntary petition by Tenant's
creditors, which involuntary petition remains undischarged for a period of
thirty (30) days. In the event that under applicable law the trustee in
bankruptcy or Tenant has the right to affirm this Lease and continue to perform
the obligations of Tenant hereunder, such trustee or Tenant shall, in such time
period as may be permitted by the bankruptcy court having jurisdiction, cure all
defaults of Tenant hereunder outstanding as of the date of the affirmance of
this Lease and provide to Landlord such adequate assurances as may be necessary
to ensure Landlord of the continued performance of Tenant's obligations under
this Lease. Specifically, but without limiting the generality of the foregoing,
such adequate assurances must include assurances that the Building continues to
be operated only for the use permitted hereunder. The provisions hereof are to
assure that the basic understandings between Landlord and Tenant with respect to
Tenant's use of the Property and the benefits to Landlord therefrom are
preserved, consistent with the purpose and intent of applicable bankruptcy laws;

                  (f)      RECEIVERSHIP. The employment of a receiver appointed
by court order to take possession of substantially all of Tenant's assets or the
Building, if such receivership remains undissolved for a period of thirty (30)
days;

                  (g)      ATTACHMENT. The attachment, execution or other
judicial seizure of all or substantially all of Tenant's assets or the Building,
if such attachment or other seizure remains undismissed or undischarged for a
period of thirty (30) days after the levy thereof; or

                  (h)      INSOLVENCY. The admission by Tenant in writing of its
inability to pay its debts as they become due, the filing by Tenant of a
petition seeking any reorganization or arrangement, composition, readjustment,
liquidation, dissolution or similar relief under any present or future statute,
law or regulation, the filing by Tenant of an answer admitting or failing timely
to contest a material allegation of a petition filed against Tenant in any such
proceeding or, if within thirty (30) days after the commencement of any
proceeding against Tenant seeking any reorganization or arrangement,
composition, readjustment, liquidation, dissolution or similar relief under any
present or future statute, law or regulation, such proceeding shall not have
been dismissed.

         16.2     REMEDIES UPON TENANT'S DEFAULT.

                  (a)      Upon the occurrence of any event of default described
in Section 16.1 hereof, Landlord, in addition to and without prejudice to any
other rights or remedies it may have, shall have the immediate right to re-enter
the Building or any part thereof and repossess the same, expelling and removing
therefrom all persons and property (which property may be stored in a public
warehouse or elsewhere at the cost and risk of and for the account of Tenant),
using such force as may be necessary to do so (as to which Tenant hereby waives
any claim for loss or damage that may thereby occur). In addition to or in lieu
of such re-entry, and without prejudice to any other rights or remedies it may
have, Landlord shall have the right either (i) to terminate this Lease and
recover from Tenant all damages incurred by Landlord as a result of Tenant's
default, as hereinafter provided, or (ii) to continue this Lease in effect and
recover rent and other charges and amounts as they become due.

                  (b)      Even if Tenant has breached this Lease and abandoned
the Building, this Lease shall continue in effect for so long as Landlord does
not terminate Tenant's right to possession under subsection (a) hereof and
Landlord may enforce all of its rights and remedies under this Lease, including
the right to recover rent as it becomes due, and Landlord, without terminating
this Lease, may exercise all of the rights and remedies of a lessor under
California Civil Code Section 1951.4 (lessor may continue lease in effect after
lessee's breach and abandonment and recover rent as it becomes due, if lessee
has right to sublet or assign, subject only to reasonable limitations), or any
successor Code section. Acts of maintenance, preservation or efforts to relet
the Building or the appointment of a receiver upon application of Landlord to
protect Landlord's interests under this Lease shall not constitute a termination
of Tenant's right to possession.

                                      -32-
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                  (c)      If Landlord terminates this Lease pursuant to this
Section 16.2, Landlord shall have all of the rights and remedies of a landlord
provided by Section 1951.2 of the Civil Code of the State of California, or any
successor Code section, which remedies include Landlord's right to recover from
Tenant (i) the worth at the time of award of the unpaid rent and additional rent
which had been earned at the time of termination, (ii) the worth at the time of
award of the amount by which the unpaid rent and additional rent which would
have been earned after termination until the time of award exceeds the amount of
such rental loss that Tenant proves could have been reasonably avoided, (iii)
the worth at the time of award of the amount by which the unpaid rent and
additional rent for the balance of the term after the time of award exceeds the
amount of such rental loss that Tenant proves could be reasonably avoided, and
(iv) any other amount necessary to compensate Landlord for all the detriment
proximately caused by Tenant's failure to perform its obligations under this
Lease or which in the ordinary course of things would be likely to result
therefrom, including, but not limited to, the cost of recovering possession of
the Building, expenses of reletting, including necessary repair, renovation and
alteration of the Building, reasonable attorneys' fees, and other reasonable
costs. The "WORTH AT THE TIME OF AWARD" of the amounts referred to in clauses
(i) and (ii) above shall be computed by allowing interest at ten percent (10%)
per annum from the date such amounts accrued to Landlord. The "WORTH AT THE TIME
OF AWARD" of the amounts referred to in clause (iii) above shall be computed by
discounting such amount at one percentage point above the discount rate of the
Federal Reserve Bank of San Francisco at the time of award.

         16.3     REMEDIES CUMULATIVE. All rights, privileges and elections or
remedies of Landlord contained in this Article 16 are cumulative and not
alternative to the extent permitted by law and except as otherwise provided
herein.

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                     17. SUBORDINATION, ATTORNMENT AND SALE

         17.1     SUBORDINATION TO MORTGAGE. This Lease, and any sublease
entered into by Tenant under the provisions of this Lease, shall be subject and
subordinate to any ground lease, mortgage, deed of trust, sale/leaseback
transaction or any other hypothecation for security now or hereafter placed upon
the Building, the Property, the Center, or any of them, and the rights of any
assignee of Landlord or of any ground lessor, mortgagee, trustee, beneficiary or
leaseback lessor under any of the foregoing, and to any and all advances made on
the security thereof and to all renewals, modifications, consolidations,
replacements and extensions thereof; PROVIDED, however, that such subordination
in the case of any future ground lease, mortgage, deed of trust, sale/leaseback
transaction or any other hypothecation for security placed upon the Building,
the Property, the Center, or any of them shall be conditioned on Tenant's
receipt from the ground lessor, mortgagee, trustee, beneficiary or leaseback
lessor of a Non-Disturbance Agreement in a form reasonably acceptable to Tenant
(i) confirming that so long as Tenant is not in material default hereunder
beyond any applicable cure period (for which purpose the occurrence of any event
of default under Section 16.1 hereof shall be deemed to be "material"), Tenant's
rights hereunder shall not be disturbed by such person or entity and (ii)
agreeing that the benefit of such Non-Disturbance Agreement shall be
transferable to any transferee under a Permitted Transfer and to any other
assignee or subtenant that is acceptable to the ground lessor, mortgagee,
trustee, beneficiary or leaseback lessor at the time of transfer. If any
mortgagee, trustee, beneficiary, ground lessor, sale/leaseback lessor or
assignee elects to have this Lease be an encumbrance upon the Property prior to
the lien of its mortgage, deed of trust, ground lease or leaseback lease or
other security arrangement and gives notice thereof to Tenant, this Lease shall
be deemed prior thereto, whether this Lease is dated prior or subsequent to the
date thereof or the date of recording thereof. Tenant, and any sublessee, shall
execute such documents as may reasonably be requested by any mortgagee, trustee,
beneficiary, ground lessor, sale/leaseback lessor or assignee to evidence the
subordination herein set forth, subject to the conditions set forth above, or to
make this Lease prior to the lien of any mortgage, deed of trust, ground lease,
leaseback lease or other security arrangement, as the case may be. Upon any
default by Landlord in the performance of its obligations under any mortgage,
deed of trust, ground lease, leaseback lease or assignment, Tenant (and any
sublessee) shall, notwithstanding any subordination hereunder, attorn to the
mortgagee, trustee, beneficiary, ground lessor, leaseback lessor or assignee
thereunder upon demand and become the tenant of the successor in interest to
Landlord, at the option of such successor in interest, and shall execute and
deliver any instrument or instruments confirming the attornment herein provided
for. Promptly following execution of this Lease, Landlord shall use commercially
reasonable efforts to obtain a Non-Disturbance Agreement comparable to that
described above in this Section 17.1 from any mortgagee, trustee, beneficiary,
ground lessor or leaseback lessor holding an interest in the Property on the
date of this Lease (but Landlord hereby advises Tenant that in fact there is no
mortgagee, trustee, beneficiary, ground lessor or leaseback lessor holding an
interest in the Property on the date of this Lease).

         17.2     SALE OF LANDLORD'S INTEREST. Upon sale, transfer or assignment
of Landlord's entire interest in the Building and the Property, Landlord shall
be relieved of its obligations hereunder with respect to liabilities accruing
from and after the date of such sale, transfer or assignment.

         17.3     ESTOPPEL CERTIFICATES. Tenant or Landlord (the "RESPONDING
PARTY"), as applicable, shall at any time and from time to time, within ten (10)
business days after written request by the other party (the "REQUESTING PARTY"),
execute, acknowledge and deliver to the requesting party a certificate in
writing stating: (i) that this Lease is unmodified and in full force and effect,
or if there have been any modifications, that this Lease is in full force and
effect as modified and stating the date and the nature of each modification;
(ii) the date to which rental and all other sums payable hereunder have been
paid; (iii) that the requesting party is not in default in the performance of
any of its obligations under this Lease, that the certifying party has given no
notice of default to the requesting party and that no event has occurred which,
but for the expiration of the applicable time period, would constitute an event
of default hereunder, or if the responding party alleges that any such default,
notice or event has occurred, specifying the same in reasonable detail; and (iv)
such other matters as may reasonably be requested by the

                                      -34-
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requesting party or by any institutional lender, mortgagee, trustee,
beneficiary, ground lessor, sale/leaseback lessor or prospective purchaser of
the Property, or prospective sublessee or assignee of this Lease. Any such
certificate provided under this Section 17.3 may be relied upon by any lender,
mortgagee, trustee, beneficiary, assignee or successor in interest to the
requesting party, by any prospective purchaser, by any purchaser on foreclosure
or sale, by any grantee under a deed in lieu of foreclosure of any mortgage or
deed of trust on the Property, by any subtenant or assignee, or by any other
third party. Failure to execute and return within the required time any estoppel
certificate requested hereunder, if such failure continues for five (5) days
after a second written request by the requesting party for such estoppel
certificate, shall be deemed to be an admission of the truth of the matters set
forth in the form of certificate submitted to the responding party for
execution.

         17.4     SUBORDINATION TO CC&R'S. This Lease, and any permitted
sublease entered into by Tenant under the provisions of this Lease, and the
interests in real property conveyed hereby and thereby shall be subject and
subordinate (a) to any declarations of covenants, conditions and restrictions or
other recorded restrictions affecting the Property or the Center from time to
time, PROVIDED that the terms of such declarations or restrictions are
reasonable (or, to the extent they are not reasonable, are mandated by
applicable law), do not materially impair Tenant's ability to conduct the uses
permitted hereunder on the Property, and do not discriminate against Tenant
relative to other similarly situated tenants occupying portions of the Center,
(b) to the Declaration of Covenants, Conditions and Restrictions and Reciprocal
Easements for Shearwater Project dated January 21, 1998 and recorded on January
22, 1998 as Instrument No. 98-008277, Official Records of San Mateo County, as
amended from time to time (the "SHEARWATER DECLARATION"), the provisions of
which Shearwater Declaration are an integral part of this Lease, and (c) to the
Covenant and Environmental Restriction dated as of January 26, 1998 and recorded
on February 3, 1998 as Instrument No. 98-013813, Official Records of San Mateo
County, as amended from time to time (the "ENVIRONMENTAL RESTRICTION"), the
provisions of which Environmental Restriction are incorporated herein by this
reference. Tenant agrees to execute, upon request by Landlord, any documents
reasonably required from time to time to evidence the foregoing subordination.

         17.5     MORTGAGEE PROTECTION. If, following a default by Landlord
under any mortgage, deed of trust, ground lease, leaseback lease or other
security arrangement covering the Building, the Property, the Center, or any of
them, the Building, the Property and/or the Center, as applicable, is acquired
by the mortgagee, beneficiary, master lessor or other secured party, or by any
other successor owner, pursuant to a foreclosure, trustee's sale, sheriff's
sale, lease termination or other similar procedure (or deed in lieu thereof),
then any such person or entity so acquiring the Building, the Property and/or
the Center shall not be:

                  (a)      liable for any act or omission of a prior landlord or
owner of the Property (including, but not limited to, Landlord);

                  (b)      subject to any offsets or defenses that Tenant may
have against any prior landlord or owner of the Property and/or the Center
(including, but not limited to, Landlord);

                  (c)      bound by any rent or additional rent that Tenant may
have paid in advance to any prior landlord or owner of the Property and/or the
Center (including, but not limited to, Landlord) for a period in excess of one
month, or by any security deposit, cleaning deposit or other prepaid charge that
Tenant may have paid in advance to any prior landlord or owner (including, but
not limited to, Landlord), except to the extent such deposit or prepaid amount
has been expressly turned over to or credited to the successor owner thus
acquiring the Property and/or the Center, as applicable;

                  (d)      liable for any warranties or representations of any
nature whatsoever, whether pursuant to this Lease or otherwise, by any prior
landlord or owner of the Property and/or the Center (including, but not limited
to, Landlord) with respect to the use, construction, zoning, compliance with
laws, title, habitability, fitness for purpose or possession, or physical

                                      -35-
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condition (including, without limitation, environmental matters) of the
Property, the Building or the Center; or

                  (e)      liable to Tenant in any amount beyond the interest of
such mortgagee, beneficiary, master lessor or other secured party or successor
owner in the Property and the Center as they exist from time to time, it being
the intent of this provision that Tenant shall look solely to the interest of
any such mortgagee, beneficiary, master lessor or other secured party or
successor owner in the Property and Center for the payment and discharge of the
landlord's obligations under this Lease and that such mortgagee, beneficiary,
master lessor or other secured party or successor owner shall have no separate
personal liability for any such obligations.

                                  18. SECURITY

         18.1     DEPOSIT.

                  (a)      Within ten (10) days after mutual execution of this
Lease, Tenant shall deposit with Landlord the sum of Seven Hundred Thirty-Eight
Thousand and No/100 Dollars ($738,000.00), which sum (the "SECURITY DEPOSIT")
shall be held by Landlord as security for the faithful performance of all of the
terms, covenants, and conditions of this Lease to be kept and performed by
Tenant during the term hereof. If Tenant defaults (beyond any applicable cure
period) with respect to any provision of this Lease, including, without
limitation, the provisions relating to the payment of rental and other sums due
hereunder, Landlord shall have the right, but shall not be required, to use,
apply or retain all or any part of the Security Deposit for the payment of
rental or any other amount which Landlord may spend or become obligated to spend
by reason of Tenant's default or to compensate Landlord for any other loss or
damage which Landlord may suffer by reason of Tenant's default. If any portion
of the Security Deposit is so used or applied, Tenant shall, within ten (10)
days after written demand therefor, deposit cash with Landlord in an amount
sufficient to restore the Security Deposit to its original amount and Tenant's
failure to do so shall be a material breach of this Lease. Landlord shall not be
required to keep any deposit under this Section separate from Landlord's general
funds, and Tenant shall not be entitled to interest thereon. If Tenant fully and
faithfully performs every provision of this Lease to be performed by it, the
Security Deposit, or any balance thereof, shall be returned to Tenant or, at
Landlord's option, to the last assignee of Tenant's interest hereunder, at the
expiration of the term of this Lease and after Tenant has vacated the Property.
In the event of termination of Landlord's interest in this Lease, Landlord shall
transfer all deposits then held by Landlord under this Section to Landlord's
successor in interest, whereupon Tenant agrees to release Landlord from all
liability for the return of such deposit or the accounting thereof.

                  (b)      As an alternative to the cash Security Deposit
described in Section 18.1(a), Tenant may instead deliver to Landlord, within ten
(10) days after mutual execution of this Lease, an irrevocable standby letter of
credit (the "LETTER OF CREDIT") issued in favor of Landlord by a federally
insured commercial bank or trust company approved in writing by Landlord (which
approval shall not be unreasonably withheld), in form and substance satisfactory
to Landlord, to be held by Landlord as security for the faithful performance of
all the obligations of Tenant under this Lease, subject to the following terms
and conditions:

                           (i)      The amount of the Letter of Credit shall be
at least Seven Hundred Thirty-Eight Thousand and No/100 Dollars ($738,000.00),
and Tenant shall maintain the Letter of Credit in that amount in full force and
effect throughout the term of this Lease (including any extensions thereof) and
until thirty (30) days after the expiration of the term of this Lease, unless
Tenant elects at any time to replace the Letter of Credit with a full cash
Security Deposit in compliance with Section 18.1(a). The Letter of Credit may be
for an initial one-year term, with automatic renewal provisions, provided that
Landlord shall be given at least thirty (30) days prior written notice if the
Letter of Credit will not be renewed as of any otherwise applicable renewal date
and shall be entitled to draw against the expiring Letter of Credit if a
replacement Letter of Credit is not furnished to Landlord at least twenty (20)
days prior to the scheduled expiration date, as provided in Section
18.2(b)(iii)(A) below.

                                      -36-
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                           (ii)     Landlord shall be entitled (but shall not be
required) to draw against the Letter of Credit and receive and retain the
proceeds thereof upon any default (beyond any applicable cure period) by Tenant
in the payment of any rent or other amounts required to be paid by Tenant under
this Lease, or upon the occurrence of any other event of default (beyond any
applicable cure period) under this Lease. The amount of the draw shall not
exceed the amount of the payments (if any) as to which Tenant is then in default
and/or the amount reasonably necessary to cure any non-monetary events of
default by Tenant, and shall be applied by Landlord to the cure of the
applicable default(s). Following any partial draw under this paragraph (ii), if
Tenant fully cures all outstanding defaults and provides Landlord with a new
Letter of Credit in the full required amount under this Section 18.1, Landlord
shall surrender and return to Tenant, within ten (10) days after Tenant's
satisfaction of the foregoing conditions, the Letter of Credit under which the
partial draw was made, together with any proceeds not already applied by
Landlord toward the cure of the applicable default(s).

                           (iii)    Landlord shall also be entitled (but shall
not be required) to draw against the Letter of Credit in full and to receive the
entire proceeds thereof under either of the following circumstances:

                                    (A)      If the Letter of Credit will expire
as of a date prior to the thirty (30) days after the expiration of the term of
this Lease and Tenant fails to provide to Landlord an extension or replacement
of such Letter of Credit, in at least the minimum amount required under this
Section 18.1(b), at least twenty (20) days prior to the scheduled expiration
date of the Letter of Credit; or

                                    (B)      If, as a result of a draw against
the Letter of Credit by Landlord or for any other reason, the amount of the
Letter of Credit falls below the minimum amount required to be maintained from
time to time pursuant to this Section 18.1(b) and Tenant has failed to cause the
Letter of Credit to be restored to at least the minimum required amount within
ten (10) days after written demand by Landlord.

                           (iv)     If Landlord draws against the Letter of
Credit in any of the circumstances described in subparagraph (iii) above,
Landlord shall use, apply and/or retain all or any part of the amount drawn for
the cure of any then existing defaults under this Lease. Any amount drawn that
is not immediately so used or applied by Landlord shall be retained by Landlord
as a cash security deposit, subject to and in accordance with the provisions of
Section 18.1(a); PROVIDED, however, if Tenant fully cures all of the outstanding
defaults described in subparagraph (iii) above and provides Landlord with a new
Letter of Credit in the full amount required under this Section 18.1, Landlord
shall surrender and return to Tenant, within ten (10) days after Tenant's
satisfaction of the foregoing conditions, any proceeds drawn by Landlord and not
already applied by Landlord toward the cure of the applicable default(s).

                  (c)      Any actual or purported withdrawal, rescission,
termination or revocation of the Letter of Credit by the issuer thereof prior to
the expiration of the term of this Lease (except when replaced prior to the
effectiveness of such withdrawal, rescission, termination or revocation by a
replacement Letter of Credit as contemplated in Section 18.1(b)(iii)(A) hereof)
shall be a material breach of this Lease.

                                19. MISCELLANEOUS

                                      -37-
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         19.1     NOTICES. All notices, consents, waivers and other
communications which this Lease requires or permits either party to give to the
other shall be in writing and shall be deemed given when delivered personally
(including delivery by private same-day or overnight courier or express delivery
service) or by telecopier with mechanical confirmation of transmission,
effective upon personal delivery to or refusal of delivery by the recipient (in
the case of personal delivery by any of the means described above) or upon
telecopier transmission during normal business hours at the recipient's office
(in the case of telecopier transmission, with any transmission outside of normal
business hours being effective as of the beginning of the first business day
commencing after the time of actual transmission) to the parties at their
respective addresses as follows:

         To Tenant:                 (until Rent Commencement Date)
                                    EOS Biotechnology, Inc.
                                    225A Gateway Boulevard
                                    South San Francisco, CA  94080
                                    Attn:  John Whelan, VP & CFO
                                    Telecopier:  (650) 583-3881

                                    (after Rent Commencement Date)
                                    EOS Biotechnology, Inc.
                                    1150 Veterans Boulevard
                                    South San Francisco, CA  94080
                                    Attn:  John Whelan, VP & CFO
                                    Telecopier:  (650) [TO BE DETERMINED]

         with a copy to:            Hopkins & Carley
                                    70 S. First Street
                                    San Jose, CA  95113-2406
                                    Attn:  Terrence S. Daly, Esq.
                                    Telecopier:  (408) 998-4790

         To Landlord:               Slough BTC, LLC
                                    33 West Monroe Street, Suite 2000
                                    Chicago, IL  60603
                                    Attn:  William Rogalla
                                    Telecopier:  (312) 558-9041

         with a copy to:            Britannia Management Services, Inc.
                                    1939 Harrison Street, Suite 715
                                    Oakland, CA  94612
                                    Telecopier:  (510) 763-6262

         and a copy to:             Folger Levin & Kahn LLP
                                    Embarcadero Center West
                                    275 Battery Street, 23rd Floor
                                    San Francisco, CA 94111
                                    Attn: Donald E. Kelley, Jr.
                                    Telecopier:  (415) 986-2827

or to such other address as may be contained in a notice at least fifteen (15)
days prior to the address change from either party to the other given pursuant
to this Section. Rental payments and other sums required by this Lease to be
paid by Tenant shall be delivered to Landlord in care of Britannia Management
Services, Inc., 1939 Harrison Street, Suite 715, Oakland, CA 94612, or at such
other address as Landlord may from time to time specify in writing to Tenant,
and shall be deemed to be paid only upon actual receipt.

         19.2     SUCCESSORS AND ASSIGNS. The obligations of this Lease shall
run with the land, and this Lease shall be binding upon and inure to the benefit
of the parties hereto and their

                                      -38-
<Page>

respective successors and assigns, except that the original Landlord named
herein and each successive Landlord under this Lease shall be liable only for
obligations accruing during the period of its ownership of the Property, and any
liability for obligations accruing after termination of such ownership shall
terminate as of the date of such termination of ownership and shall pass to the
successor lessor.

         19.3     NO WAIVER. The failure of Landlord to seek redress for
violation, or to insist upon the strict performance, of any covenant or
condition of this Lease shall not be deemed a waiver of such violation, or
prevent a subsequent act which would originally have constituted a violation
from having all the force and effect of an original violation.

         19.4     SEVERABILITY. If any provision of this Lease or the
application thereof is held to be invalid or unenforceable, the remainder of
this Lease or the application of such provision to persons or circumstances
other than those as to which it is invalid or unenforceable shall not be
affected thereby, and each of the provisions of this Lease shall be valid and
enforceable, unless enforcement of this Lease as so invalidated would be
unreasonable or grossly inequitable under all the circumstances or would
materially frustrate the purposes of this Lease.

         19.5     LITIGATION BETWEEN PARTIES. In the event of any litigation or
other dispute resolution proceedings between the parties hereto arising out of
or in connection with this Lease, the prevailing party shall be reimbursed for
all reasonable costs, including, but not limited to, reasonable accountants'
fees and attorneys' fees, incurred in connection with such proceedings
(including, but not limited to, any appellate proceedings relating thereto) or
in connection with the enforcement of any judgment or award rendered in such
proceedings. "PREVAILING PARTY" within the meaning of this Section shall
include, without limitation, a party who dismisses an action for recovery
hereunder in exchange for payment of the sums allegedly due, performance of
covenants allegedly breached or consideration substantially equal to the relief
sought in the action.

         19.6     SURRENDER. A voluntary or other surrender of this Lease by
Tenant, or a mutual termination thereof between Landlord and Tenant, shall not
result in a merger but shall, at the option of Landlord, operate either as an
assignment to Landlord of any and all existing subleases and subtenancies, or a
termination of all or any existing subleases and subtenancies. This provision
shall be contained in any and all assignments or subleases made pursuant to this
Lease.

         19.7     INTERPRETATION. The provisions of this Lease shall be
construed as a whole, according to their common meaning, and not strictly for or
against Landlord or Tenant. The captions preceding the text of each Section and
subsection hereof are included only for convenience of reference and shall be
disregarded in the construction or interpretation of this Lease.

         19.8     ENTIRE AGREEMENT. This written Lease, together with the
exhibits hereto, contains all the representations and the entire understanding
between the parties hereto with respect to the subject matter hereof. Any prior
correspondence, memoranda or agreements are replaced in total by this Lease and
the exhibits hereto. This Lease may be modified only by an agreement in writing
signed by each of the parties.

         19.9     GOVERNING LAW. This Lease and all exhibits hereto shall be
construed and interpreted in accordance with and be governed by all the
provisions of the laws of the State of California.

         19.10    NO PARTNERSHIP. The relationship between Landlord and Tenant
is solely that of a lessor and lessee. Nothing contained in this Lease shall be
construed as creating any type or manner of partnership, joint venture or joint
enterprise with or between Landlord and Tenant.

         19.11    FINANCIAL INFORMATION. From time to time Tenant shall promptly
provide directly to prospective lenders and purchasers of the Property and/or
Center designated by Landlord such financial information pertaining to the
financial status of Tenant as Landlord may reasonably

                                      -39-
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request; PROVIDED, Tenant shall be permitted to provide such financial
information in a manner which Tenant deems reasonably necessary to protect the
confidentiality of such information. In addition, from time to time, Tenant
shall provide Landlord with such financial information pertaining to the
financial status of Tenant as Landlord may reasonably request. Landlord agrees
that all financial information supplied to Landlord by Tenant shall be treated
as confidential material, and shall not be disseminated to any party or entity
(including any entity affiliated with Landlord) without Tenant's prior written
consent, except that Landlord shall be entitled to provide such information,
subject to reasonable precautions to protect the confidential nature thereof,
(i) to Landlord's partners and professional advisors, solely to use in
connection with Landlord's execution and enforcement of this Lease, and (ii) to
prospective lenders and/or purchasers of the Property and/or Center, solely for
use in connection with their bona fide consideration of a proposed financing or
purchase of the Property and/or Center, PROVIDED that such prospective lenders
and/or purchasers are not then engaged in businesses directly competitive with
the business then being conducted by Tenant. For purposes of this Section,
without limiting the generality of the obligations provided herein, it shall be
deemed reasonable for Landlord to request copies of Tenant's most recent audited
annual financial statements, or, if audited statements have not been prepared,
unaudited financial statements for Tenant's most recent fiscal year, accompanied
by a certificate of Tenant's chief financial officer that such financial
statements fairly present Tenant's financial condition as of the date(s)
indicated. Notwithstanding any other provisions of this Section 19.11, during
any period in which Tenant has outstanding a class of publicly traded securities
and is filing with the Securities and Exchange Commission, on a regular basis,
Forms 10Q and 10K and any other periodic filings required under the Securities
Exchange Act of 1934, as amended, it shall constitute sufficient compliance
under this Section 19.11 for Tenant to furnish Landlord with copies of such
periodic filings substantially concurrently with the filing thereof with the
Securities and Exchange Commission.

                  Landlord and Tenant recognize the need of Tenant to maintain
the confidentiality of information regarding its financial status and the need
of Landlord to be informed of, and to provide to prospective lenders and
purchasers of the Property and/or Center financial information pertaining to,
Tenant's financial status. Landlord and Tenant agree to cooperate with each
other in achieving these needs within the context of the obligations set forth
in this Section.

         19.12    COSTS. If Tenant requests the consent of Landlord under any
provision of this Lease for any act that Tenant proposes to do hereunder,
including, without limitation, assignment of this Lease or subletting of the
Building or any part thereof, Tenant shall, as a condition to doing any such act
and the receipt of such consent, reimburse Landlord promptly for any and all
actual and reasonable costs and expenses incurred by Landlord in connection
therewith, including, without limitation, reasonable attorneys' fees.

         19.13    TIME. Time is of the essence of this Lease, and of every term
and condition hereof.

         19.14    RULES AND REGULATIONS. Tenant shall observe, comply with and
obey, and shall cause its employees, agents and, to the best of Tenant's
ability, invitees to observe, comply with and obey such reasonable rules and
regulations as Landlord may promulgate from time to time for the safety, care,
cleanliness, order and use of the Improvements, the Property and the Center.

         19.15    BROKERS. Landlord agrees to pay a brokerage commission to
Tenant's broker, CB Richard Ellis, in connection with the consummation of this
Lease in accordance with a separate written agreement (providing for a
commission of $6.00 per rentable square foot, payable 50% upon execution of this
Lease and 50% upon occupancy of the Building by Tenant). Each party represents
and warrants that no other broker participated in the consummation of this Lease
and agrees to indemnify, defend and hold the other party harmless against any
liability, cost or expense, including, without limitation, reasonable attorneys'
fees, arising out of any claims for brokerage commissions or other similar
compensation in connection with any conversations, prior negotiations or other
dealings by the indemnifying party with any other broker.

                                      -40-
<Page>

         19.16    MEMORANDUM OF LEASE. At any time during the term of this
Lease, either party, at its sole expense, shall be entitled to record a
memorandum of this Lease and, if either party so elects, both parties agree to
cooperate in the preparation, execution, acknowledgment and recordation of such
document in reasonable form.

         19.17    CORPORATE AUTHORITY. The person signing this Lease on behalf
of Tenant warrants that he or she is fully authorized to do so and, by so doing,
to bind Tenant.

         19.18    EXECUTION AND DELIVERY. This Lease may be executed in one or
more counterparts and by separate parties on separate counterparts, but each
such counterpart shall constitute an original and all such counterparts together
shall constitute one and the same instrument.

         19.19    SURVIVAL. Without limiting survival provisions which would
otherwise be implied or construed under applicable law, the provisions of
Sections 2.5, 7.4, 9.2, 9.3, 9.4, 11.6, 12.6, 19.5 and 19.20 hereof shall
survive the termination of this Lease with respect to matters occurring prior to
the expiration of this Lease.

         19.20    PARKING AND TRAFFIC.

                  (a)      Landlord has advised Tenant that the approval of the
Britannia Oyster Point project by the City of South San Francisco was
conditioned upon, among other things, Landlord's development and implementation
of a Transportation Demand Management Plan (the "TDMP") pursuant to which
Landlord is required to undertake various measures to try to reduce the volume
of traffic generated by the Center. Tenant hereby agrees (i) to designate one of
its employees to act as a liaison with Landlord's designated transportation
coordinator in facilitating and coordinating such programs as may be required
from time to time by governmental agencies and/or by the terms of the TDMP to
reduce the traffic generated by the Center (as required by the City of South San
Francisco as part of the conditions of approval of this project) and to
facilitate and encourage the use of public transportation, (ii) to make
reasonable efforts to encourage cooperation and participation by Tenant's
employees in the programs implemented from time to time pursuant to the TDMP,
including (but not limited to) programs described in this Section 19.20, and
(iii) to cooperate with Landlord's designated transportation coordinator in
identifying an appropriate area within the Building where an information kiosk
can be maintained for the dissemination of transportation-related information,
to be updated from time to time by Landlord's designated transportation
coordinator.

                  (b)      The Center is presently intended to contain a maximum
of 3.3 parking spaces per 1,000 square feet of rentable area in the buildings to
be constructed on the Property, subject to approval by appropriate agencies of
the City of South San Francisco. Consistent with the TDMP, a specified
percentage (presently anticipated to be ten percent (10%)) of these spaces will
be designated for carpool, vanpool and clean fuel vehicles. Among other things,
the City of South San Francisco requires, through its approval of the TDMP that
Landlord was required to adopt and implement as a condition of approval of
Landlord's development plans, that Landlord charge a monthly parking fee for
each parking space allocated to tenants and their employees. The monthly fee per
parking space shall be $20 per parking space for each of the first five (5)
years after the Rent Commencement Date, $30 per parking space for years six (6)
through ten (10) after the Rent Commencement Date, and $35 per parking space for
years eleven (11) through fifteen (15) after the Rent Commencement Date. In
accordance with the policies and requirements of the City of South San
Francisco, Landlord recommends that Tenant pass through these parking charges to
Tenant's employees using the spaces. (Thus, for example, in years one (1)
through five (5) of the Lease term, assuming 82,000 square feet in the Building
and 3.3 spaces of parking per 1,000 square feet in the Center, Tenant would have
270 allocable parking spaces at $20 per space per month, for a total monthly
parking fee of $5,400.) Notwithstanding any other provisions of this Section
19.20(b), however, if at any time during the term of this Lease (x) Landlord is
permitted to terminate the TDMP or to modify it in such a manner that it no
longer requires Landlord to charge tenants of the Center for parking and (y)
Landlord is not then subject to any other agreement with any governmental
authority or to any other law, ordinance, regulation, order, requirement or
policy of any governmental authority which either

                                      -41-
<Page>

requires Landlord to charge tenants of the Center for parking or imposes any
charge or penalty or other material detriment on Landlord or the Center in the
event of any failure of Landlord to charge tenants of the Center for parking,
then for so long as such conditions continue to exist, then the parking charge
imposed on Tenant under this Section 19.20(b) shall be waived; and if at any
time during the term of this Lease the conditions contemplated in clauses (x)
and (y) of the preceding portion of this sentence are met in a manner which does
not permit complete elimination of parking charges to tenants of the Center but
permits a reduction in the rates that Landlord is required to charge tenants of
the Center for parking, then the parking charge imposed on Tenant under this
Section 19.20(b) shall be correspondingly reduced for so long as such conditions
continue to exist.

                  (c)      On or about the date Tenant commences business in the
Building, Landlord intends to provide Tenant, through Landlord's designated
transportation coordinator, with an appropriate number of packets of employee
transportation information, presently expected to include (but not be limited
to) information about carpool parking; schedules and maps for SamTrans,
Caltrain, BART and shuttle services operating to and from the Property; and a
bicycle map. Landlord shall thereafter cause its designated transportation
coordinator to provide updated copies of the employee transportation information
packet to Tenant from time to time, as appropriate, and to make additional
copies of the packet available to Tenant from time to time, upon request by
Tenant, for new employees. Tenant shall distribute copies of the employee
transportation information packet to all employees commuting to the Property at
the time Tenant commences business in the Building, shall thereafter distribute
copies of the packet to new employees from time to time and shall distribute
updated packets to all employees from time to time when and as such updated
packets are furnished to Tenant by Landlord's designated transportation
coordinator.

                  (d)      Landlord is required to conduct, pursuant to the
TDMP, annual surveys of its tenants and their employees regarding both
quantitative and qualitative aspects of commuting and transportation patterns at
the Center. Landlord anticipates that these surveys will be prepared,
administered and analyzed by an independent transportation consultant retained
by the City of South San Francisco, and will be summarized by that consultant in
an annual report to be submitted by that consultant to the City of South San
Francisco and its Redevelopment Agency with respect to the Center. Tenant shall
cooperate with Landlord, with Landlord's designated transportation coordinator
and with any independent transportation consultant retained by the City, and
shall use reasonable efforts to cause Tenant's employees to so cooperate, in the
completion and return of such surveys from time to time, when and as requested
by Landlord or its designated transportation coordinator or the independent
consultant. Tenant acknowledges and understands that employees who fail to
respond to such surveys will be counted as drive-alone commuters.

                  (e)      Landlord has advised Tenant that pursuant to
conditions imposed by the City of South San Francisco and its Redevelopment
Agency, Landlord may incur financial penalties if implementation of the TDMP at
the Center fails to achieve a target rate of at least thirty-five percent (35%)
alternative mode transportation usage (the "ALTERNATIVE MODE STANDARD") by
employees working at the Center, as reflected in the surveys conducted pursuant
to Section 19.20(d) above. Any such financial penalties shall be imposed by the
City of South San Francisco Redevelopment Agency (the "REDEVELOPMENT AGENCY"),
in its sole discretion, based on its review of the annual reports submitted from
time to time pursuant to Section 19.20(d) above. The amount of such financial
penalties is presently set at $15,000 per year for each percentage point (if
any) by which, after a phase-in period (two (2) years after the granting of a
certificate of occupancy) for each building, the aggregate rate of alternative
mode transportation usage by employees throughout the Center falls short of the
Alternative Mode Standard. If any such financial penalties are imposed on
Landlord for failure to meet the Alternative Mode Standard on a Center-wide
basis for any applicable survey period, then Landlord shall be entitled to pass
such financial penalties through to all tenants of the Center whose employees
have failed to demonstrate (pursuant to the applicable surveys) compliance with
the Alternative Mode Standard for the applicable period (each such tenant being
hereinafter referred to as a "NONCOMPLYING TENANT" for that period), in which
event the actual penalty

                                      -42-
<Page>

amount shall be allocated among the Noncomplying Tenants for the applicable
period in the following manner: Each Noncomplying Tenant shall bear a portion of
the applicable penalty amount equal to a fraction, the numerator of which is the
number of employees by which such Noncomplying Tenant fell short of meeting the
Alternative Mode Standard for the applicable period and the denominator of which
is the sum of the respective numbers of employees by which all Noncomplying
Tenants, in the aggregate, fell short of meeting the Alternative Mode Standard
for the applicable period. Each such Noncomplying Tenant shall pay its share of
the applicable penalty amount to Landlord within thirty (30) days after receipt
of written demand from Landlord, accompanied by supporting documentation
evidencing the applicable penalty amount, as provided by the Redevelopment
Agency or its consultant, and demonstrating in reasonable detail the calculation
of such Noncomplying Tenant's share of that penalty amount. Under no
circumstances shall Tenant be required to bear any portion of any penalties
contemplated in this paragraph with respect to any period as to which Tenant can
demonstrate that its employees, as evidenced by the applicable survey(s) for
that period, met the Alternative Mode Standard. If Tenant subleases any
portion(s) of the Building from time to time, then for purposes of this Section
19.20, as between Tenant and Landlord, Tenant shall be fully and solely
responsible for compliance by its subtenant(s) and their employees with the
requirements of this Section 19.20, and all surveys and reports submitted by
Tenant to Landlord or its designated transportation coordinator or to the
independent consultant pursuant to this Section 19.20 shall cover the entire
Building and shall report figures for Tenant and its subtenant(s) on an
aggregate basis. Nothing in the preceding sentence, however, shall preclude
Tenant, as between itself and its subtenant(s), from allocating to such
subtenant(s) in the applicable sublease agreement any compliance obligations
and/or penalty reimbursement obligations under this Section 19.20(e), but no
such allocation shall be binding on Landlord or require Landlord, its designated
transportation coordinator or the independent consultant to deal directly with
any such subtenant(s) regarding the matters addressed in this Section 19.20. If
Tenant believes, reasonably and in good faith, that there are circumstances
particular to the nature of Tenant's business operations that would justify a
mitigation of penalties and/or a modification of the implementation of the TDMP
as applied to Tenant's business, and requests in writing (with supporting
information describing, in reasonable detail, the circumstances on which Tenant
is relying) that Landlord present such mitigation or modification arguments to
the Redevelopment Agency, then Landlord shall use reasonable and good faith
efforts to present or cause its designated transportation coordinator to present
such mitigation and/or modification arguments, but Tenant acknowledges and
understands that any decision with respect to such mitigation and/or
modification arguments will be in the sole discretion of the Redevelopment
Agency and agrees that Landlord shall have no liability to Tenant if such
mitigation and/or modification arguments are not accepted by the Redevelopment
Agency.

         IN WITNESS WHEREOF, the parties hereto have executed this Lease as of
the day and year first set forth above.

              "Landlord"                                "Tenant"

SLOUGH BTC, LLC, a Delaware limited          EOS BIOTECHNOLOGY, INC., a
liability company                            Delaware corporation

By:  Slough Estates USA Inc., a Delaware     By:  /s/ David W. Martin, Jr., M.D.
     corporation, Its Manager                     ------------------------------
                                                  David W. Martin, Jr., M.D.
                                                  President and CFO

     By:   /s/ William Rogalla               By:  /s/ John Whelan
           ----------------------------           ------------------------------
     Its:    Vice President                  Its: Vice President and CFO
           ----------------------------           ------------------------------

                                      -43-
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                                    EXHIBITS

                  EXHIBIT A         Real Property Description

                  EXHIBIT B         Site Plan

                  EXHIBIT C         Workletter

                  EXHIBIT D         Estimated Construction Schedule

                  EXHIBIT E         Acknowledgment of Rent Commencement Date

<Page>

                                    EXHIBIT A

                            REAL PROPERTY DESCRIPTION

All that certain real property in the City of South San Francisco, County of San
Mateo, State of California, more particularly described as follows:

Parcels 2, 3, 5 and 6 as shown on the Bay West Cove Final Subdivision Map,
Parcel Map No. 97-027, recorded January 22, 1998 in Book 70, at pages 33-40,
File No. 98-008274, Official Records of San Mateo County, California.

                                      A-1
<Page>

                                    EXHIBIT B

                                    SITE PLAN

                                   [attached]

                                      B-1
<Page>

                            [SITE PLAN APPEARS HERE]

                                      B-2
<Page>

                                    EXHIBIT C

                                   WORKLETTER

         This Workletter ("WORKLETTER") constitutes part of the Build-to-Suit
Lease dated as of June 1, 2001 (the "LEASE") between SLOUGH BTC, LLC, a Delaware
limited liability company ("LANDLORD"), and EOS BIOTECHNOLOGY, INC., a Delaware
corporation ("TENANT"). The terms of this Workletter are incorporated in the
Lease for all purposes.

1.       DEFINED TERMS. As used in this Workletter, the following capitalized
terms have the following meanings:

         (a)      APPROVED PLANS: Plans and specifications prepared by the
applicable Architect for the respective Improvements and approved by Landlord
and, to the extent applicable, Tenant in accordance with Paragraph 2 of this
Workletter, subject to further modification from time to time to the extent
provided in and in accordance with such Paragraph 2.

         (b)      ARCHITECT: Chamorro Design Group, or any other architect
selected by Landlord in its sole discretion, with respect to the Building Shell,
the Site Improvements and any other Improvements which Landlord is to design
pursuant to this Workletter; any architect selected by Tenant with the written
approval of Landlord (which approval shall not be unreasonably withheld or
delayed), with respect to the Tenant Improvements and any other Improvements
which Tenant is to design pursuant to this Workletter.

         (c)      BUILDING SHELL: The shell of the Building, as more fully
defined in SCHEDULE C-1 attached to this Workletter.

         (d)      CHANGE ORDER REQUEST: See definition in Paragraph 2(e)(ii)
hereof.

         (e)      COST OF IMPROVEMENT: See definition in Paragraph 2(c) hereof.

         (f)      FINAL COMPLETION CERTIFICATE: See definition in Paragraph 3(b)
hereof.

         (g)      FINAL WORKING DRAWINGS: See definition in Paragraph 2(a)
hereof.

         (h)      GENERAL CONTRACTOR: Hathaway Dinwiddie Construction Company,
or any other general contractor selected by Landlord in its sole discretion,
with respect to Landlord's Work. The General Contractor with respect to Tenant's
Work shall be selected by Tenant, subject to Landlord's approval (not to be
unreasonably withheld or delayed), as contemplated in Paragraph 5(a) hereof.

         (i)      IMPROVEMENTS: The Building Shell, Site Improvements, Tenant
Improvements and other improvements shown on the Approved Plans from time to
time and to be constructed on the Property pursuant to the Lease and this
Workletter.

         (j)      LANDLORD DELAY: Any of the following types of delay in the
completion of construction of the Tenant Improvements:

                  (i)      Any delay resulting from Landlord's failure to
furnish, in a timely manner, information requested by Tenant or by the Architect
or General Contractor for Tenant's Work in connection with the design or
construction of Tenant's Work, or from Landlord's failure to approve in a timely
manner any matters requiring approval by Landlord; or

                  (ii)     Any delay of any other kind or nature caused by
Landlord (or Landlord's contractors, agents or employees) or resulting from the
performance of Landlord's Work.

                                      C-1
<Page>

         (k)      LANDLORD'S WORK: The Building Shell and Site Improvements, and
any other Improvements which Landlord is to construct or install pursuant to
this Workletter or by mutual agreement of Landlord and Tenant from time to time.

         (l)      PUNCH LIST WORK: Minor corrections of construction or
decoration details, and minor mechanical adjustments, that are required in order
to cause any applicable portion of the Improvements as constructed to conform to
the Approved Plans in all material respects and that do not materially interfere
with Tenant's use or occupancy of the Building and the Property.

         (m)      SITE IMPROVEMENTS: The parking areas, driveways, landscaping
and other improvements to the Common Areas of the Property that are depicted on
EXHIBIT B to the Lease (as the same may be modified by Landlord from time to
time pursuant to the process of development and approval of the Approved Plans).

         (n)      STRUCTURAL COMPLETION CERTIFICATE: See definition in Paragraph
3(a) hereof.

         (o)      TENANT DELAY: Any of the following types of delay in the
completion of construction of the Building Shell:

                  (i)      Any delay resulting from Tenant's failure to furnish,
in a timely manner, information requested by Landlord or by the Architect or
General Contractor for Landlord's Work in connection with the design or
construction of the Building Shell, or from Tenant's failure to approve in a
timely manner any matters requiring approval by Tenant;

                  (ii)     Any delay attributable to any request by Tenant to
construct the Building Shell in an "above standard" manner, or to any use of
"above standard" Building Shell components that is necessitated by Tenant's
particular use requirements or by the contemplated Tenant's Work;

                  (iii)    Any delay resulting from Change Order Requests
initiated by Tenant, including any delay resulting from the need to revise any
drawings or obtain further governmental approvals as a result of any such Change
Order Request; or

                  (iv)     Any delay of any other kind or nature caused by
Tenant (or Tenant's contractors, agents or employees) or resulting from the
performance of Tenant's Work.

         (p)      TENANT IMPROVEMENTS: The improvements to or within the
Building, other than improvements constituting part of the Building Shell, shown
on the Approved Plans from time to time and to be constructed by Tenant (except
as otherwise provided herein) pursuant to the Lease and this Workletter,
including (but not limited to) the improvements described on SCHEDULE C-2
attached to this Workletter (except to the extent any such SCHEDULE C-2
improvements are specifically described as constituting part of the Building
Shell).

         (q)      TENANT'S WORK: All of the Improvements other than those
constituting Landlord's Work, and such other materials and improvements as
Tenant deems necessary or appropriate for Tenant's use and occupancy of the
Building.

         (r)      UNAVOIDABLE DELAYS: Delays due to acts of God, acts of public
agencies, labor disputes, strikes, fires, freight embargoes, rainy or stormy
weather, inability to obtain supplies, materials, fuels or permits, delays of
contractors or subcontractors, or other causes or contingencies beyond the
reasonable control of Landlord or Tenant, as applicable.

         (s)      WORK DEADLINES: The target dates for performance by the
applicable party of the steps listed in the Estimated Construction Schedule
attached as EXHIBIT D to the Lease.

         (t)      Capitalized terms not otherwise defined in this Workletter
shall have the definitions set forth in the Lease.

                                       C-2
<Page>

2.       PLANS, COST OF IMPROVEMENTS AND CONSTRUCTION. Landlord and Tenant shall
comply with the procedures set forth in this Paragraph 2 in preparing,
delivering and approving matters relating to the Improvements.

         (a)      APPROVED PLANS AND WORKING DRAWINGS FOR LANDLORD'S WORK.
Landlord shall promptly and diligently (and in all events prior to any
applicable Work Deadlines, subject to Tenant Delays and Unavoidable Delays)
prepare or cause to be prepared plans and specifications for the Improvements
constituting Landlord's Work. Such plans and specifications shall not be subject
to Tenant's approval, except to the extent (and only to the extent) that
Landlord's Work includes, by mutual agreement of Landlord and Tenant, any
portion of the Tenant Improvements. Landlord shall deliver copies of such plans
and specifications to Tenant for Tenant's approval (but only to the extent
provided in the preceding sentence) and information, to assist Tenant in
providing any information and making any decisions necessary to be provided or
made by Tenant in order to permit preparation of Landlord's Final Working
Drawings as hereinafter defined, and to assist Tenant in preparing plans,
specifications and drawings for Tenant's Work as hereinafter set forth.
Following approval of such plans and specifications by Landlord and, if
applicable, by Tenant (as so approved, the "LANDLORD'S APPROVED PLANS"),
Landlord shall then prepare or cause to be prepared, on or before the applicable
Work Deadline (assuming timely delivery by Tenant of all information and
decisions required to be furnished or made by Tenant in order to permit
preparation of Landlord's Final Working Drawings), final detailed working
drawings and specifications for the Improvements constituting Landlord's Work,
including structural, fire protection, life safety, mechanical and electrical
working drawings and final architectural drawings (collectively, "LANDLORD'S
FINAL WORKING DRAWINGS"). Landlord's Final Working Drawings shall substantially
conform to the Landlord's Approved Plans. Landlord's Final Working Drawings
shall not be subject to Tenant's approval, except to the extent (and only to the
extent), as noted above, that Landlord's Work includes, by mutual agreement of
Landlord and Tenant, any portion of the Tenant Improvements. Landlord shall
deliver copies of Landlord's Final Working Drawings to Tenant for Tenant's
approval (but only to the extent provided in the preceding sentence) and
information, and to assist Tenant in preparing plans, specifications and
drawings for Tenant's Work as hereinafter set forth. Landlord's obligation to
deliver Landlord's Final Working Drawings to Tenant within the time period set
forth above shall be extended for any delay encountered by Landlord as a result
of a request by Tenant for changes in accordance with the procedure set forth
below, any other Tenant Delays, or any Unavoidable Delays. To the extent Tenant
has any right of approval over Landlord's proposed plans and specifications or
Landlord's proposed Final Working Drawings pursuant to the foregoing provisions,
no later than the applicable Work Deadline (assuming timely delivery of plans
and drawings by Landlord), Tenant shall either approve (to the extent of
Tenant's approval right) Landlord's proposed plans and specifications or
proposed Landlord's Final Working Drawings, as applicable, or set forth in
writing with particularity any changes necessary to bring the aspects of such
proposed plans and specifications or proposed Landlord's Final Working Drawings
over which Tenant has a right of approval into a form which will be acceptable
to Tenant or, in the case of Landlord's Final Working Drawings, into substantial
conformity with the Landlord's Approved Plans. Notwithstanding any other
provisions of this paragraph, in no event shall Tenant have the right to object
to any aspect of the Landlord's proposed plans and specifications or proposed
Landlord's Final Working Drawings (including, but not limited to, any
subsequently proposed changes therein from time to time) that is necessitated by
applicable law or as a condition of any governmental or other third-party
approvals or consents that are required to be obtained in connection with
Landlord's Work.. Failure of Tenant to deliver to Landlord written notice of
disapproval and specification of required changes (to the extent Tenant has a
right of approval or objection under this paragraph) on or before the applicable
Work Deadline shall constitute and be deemed to be approval of Landlord's
proposed plans and specifications or proposed Landlord's Final Working Drawings,
as applicable. Upon approval, actual or deemed, of Landlord's Final Working
Drawings by Landlord and Tenant (to the extent Tenant has such a right of
approval under this paragraph), Landlord's Final Working Drawings shall be
deemed to be incorporated in and considered part of the Landlord's Approved
Plans, superseding (to the extent of any inconsistencies) any inconsistent
features of the previously existing Landlord's Approved Plans.

                                       C-3
<Page>

         (b)      APPROVED PLANS AND WORKING DRAWINGS FOR TENANT'S WORK. Tenant
shall promptly and diligently (and in all events prior to any applicable Work
Deadlines, subject to Landlord Delays and Unavoidable Delays) cause to be
prepared and delivered to Landlord, for approval (which shall not be
unreasonably withheld or delayed by Landlord), a space plan and detailed plans
and specifications for the Improvements constituting Tenant's Work (as so
approved, the "TENANT'S APPROVED PLANS"). Following mutual approval of the
Tenant's Approved Plans, Tenant shall then cause to be prepared and delivered to
Landlord for approval (which shall not be unreasonably withheld) final working
drawings and specifications for the Improvements constituting Tenant's Work,
including any applicable life safety, mechanical and electrical working drawings
and final architectural drawings (collectively, "TENANT'S FINAL WORKING
DRAWINGS"). Tenant's Final Working Drawings shall substantially conform to the
Tenant's Approved Plans. Landlord shall either approve Tenant's Final Working
Drawings or set forth in writing with particularity any changes necessary to
bring Tenant's Final Working Drawings into substantial conformity with the
Tenant's Approved Plans or into a form which will be acceptable to Landlord.
Upon approval of Tenant's Final Working Drawings by Landlord and Tenant,
Tenant's Final Working Drawings shall be deemed to be incorporated in and
considered part of the Tenant's Approved Plans, superseding (to the extent of
any inconsistencies) any inconsistent features of the previously existing
Tenant's Approved Plans.

         (c)      COST OF IMPROVEMENTS. "COST OF IMPROVEMENT" shall mean, with
respect to any item or component for which a cost must be determined in order to
allocate such cost, or an increase in such cost, to Landlord and/or Tenant
pursuant to this Workletter, the sum of the following (unless otherwise agreed
in writing by Landlord and Tenant with respect to any specific item or component
or any category of items or components): (i) all sums paid to contractors or
subcontractors for labor and materials furnished in connection with construction
of such item or component; (ii) all costs, expenses, payments, fees and charges
(other than penalties) paid or incurred to or at the direction of any city,
county or other governmental or quasi-governmental authority or agency which are
required to be paid in order to obtain all necessary governmental permits,
licenses, inspections and approvals relating to construction of such item or
component; (iii) engineering and architectural fees for services rendered in
connection with the design and construction of such item or component
(including, but not limited to, the applicable Architect for such item or
component and an electrical engineer, mechanical engineer and civil engineer);
(iv) sales and use taxes; (v) testing and inspection costs; (vi) the cost of
power, water and other utility facilities and the cost of collection and removal
of debris required in connection with construction of such item or component;
(vii) all other "hard" costs incurred in the construction of such item or
component in accordance with the applicable Approved Plans and this Workletter;
and (viii) as to the Tenant Improvements, all costs and items specifically set
forth or described on SCHEDULE C-2 attached hereto.

         (d)      CONSTRUCTION OF LANDLORD'S WORK. Promptly following approval
of Landlord's Final Working Drawings, Landlord shall apply for and use
reasonable efforts to obtain the necessary permits and approvals to allow
construction of all Improvements constituting Landlord's Work. Upon receipt of
such permits and approvals, Landlord shall, at Landlord's sole expense (except
as otherwise provided in the Lease or in this Workletter), diligently construct
and complete the Improvements constituting Landlord's Work substantially in
accordance with the Landlord's Approved Plans, subject to Unavoidable Delays and
Tenant Delays (if any). Such construction shall be performed in a good and
workmanlike manner and shall conform to all applicable governmental codes, laws
and regulations in force at the time such work is completed. Without limiting
the generality of the foregoing, Landlord shall be responsible for compliance of
all Improvements designed and constructed by Landlord with the requirements of
the Americans with Disabilities Act and all similar or related requirements
pertaining to access by persons with disabilities. Landlord shall have the
right, in its sole discretion, to decide whether and to what extent to use union
labor on or in connection with Landlord's Work and shall use the General
Contractor designated pursuant to Paragraph 1(h) to construct all Improvements
constituting Landlord's Work.

         (e)      CHANGES.

                                       C-4
<Page>

                  (i)      If Landlord determines at any time that changes in
Landlord's Final Working Drawings or in any other aspect of the Landlord's
Approved Plans relating to any item of Landlord's Work are required as a result
of applicable law or governmental requirements, or are required at the
insistence of any other third party whose approval may be required with respect
to the Improvements, or are required as a result of unanticipated conditions
encountered in the course of construction, or are otherwise deemed desirable by
Landlord, then Landlord shall promptly (A) advise Tenant of such circumstances
and (B) cause revised Landlord's Approved Plans and/or Landlord's Final Working
Drawings, as applicable, reflecting such changes to be prepared by Architect and
submitted to Tenant, for Tenant's information (and to assist Tenant in
determining the need for any related changes in Tenant's Approved Drawings) and,
to the extent such changes relate to Tenant Improvements being constructed by
Landlord pursuant to mutual agreement of Landlord and Tenant, for approval by
Tenant in accordance with the procedure contemplated in Paragraph 2(a) hereof.
Upon final approval of such revised drawings by Landlord and Tenant (if
applicable), Landlord's Final Working Drawings and/or the Landlord's Approved
Plans shall be deemed to be modified accordingly. In the case of any such
changes in Landlord's Final Working Drawings and/or the Landlord's Approved
Plans which are required as a result of applicable law or governmental
requirements, or are required at the insistence of any other third party whose
approval may be required with respect to the Improvements, or are required as a
result of unanticipated conditions encountered in the course of construction,
Landlord shall have no liability or responsibility for any costs or cost
increases incurred by Tenant as a result of such required changes. However, in
the case of any changes in Landlord's Final Working Drawings and/or the
Landlord's Approved Plans which are merely deemed desirable by Landlord without
being required by any of the circumstances described in the preceding sentence,
then Landlord shall be responsible for all actual costs or cost increases
incurred by Tenant as a result of such changes and shall reimburse Tenant for
any such actual costs or cost increases promptly following receipt of Tenant's
written request for such reimbursement, accompanied by documentation reasonably
supporting Tenant's claimed costs or cost increases and their relationship to
the changes made by Landlord.

                  (ii)     If Tenant at any time desires any changes,
alterations or additions to the Landlord's Approved Plans or Landlord's Final
Working Drawings with respect to any of Landlord's Work, Tenant shall submit a
detailed written request to Landlord specifying such changes, alterations or
additions (a "CHANGE ORDER REQUEST"). Upon receipt of any such request, Landlord
shall promptly notify Tenant of (A) whether the matters proposed in the Change
Order Request are approved by Landlord (which approval shall not be unreasonably
withheld or delayed as to any matters relating to Tenant Improvements which are
being constructed by Landlord pursuant to mutual agreement of Landlord and
Tenant, but may be granted or withheld by Landlord in its sole discretion as to
any other aspects of Landlord's Work), (B) Landlord's estimate of the number of
days of delay, if any, which shall be caused by such Change Order Request if
implemented (including, without limitation, delays due to the need to obtain any
revised plans or drawings and any governmental approvals), and (C) Landlord's
estimate of the increase, if any, which shall occur in the Cost of Improvement
for the items or components affected by such Change Order Request if such Change
Order Request is implemented (including, but not limited to, any costs of
compliance with laws or governmental regulations that become applicable because
of the implementation of the Change Order Request). If Landlord approves the
Change Order Request and Tenant notifies Landlord in writing, within five (5)
business days after receipt of such notice from Landlord, of Tenant's approval
of the Change Order Request (including the estimated delays and cost increases,
if any, described in Landlord's notice), then Landlord shall cause such Change
Order Request to be implemented and Tenant shall be responsible for all actual
costs or cost increases resulting from or attributable to the implementation of
the Change Order Request, subject to the provisions of Paragraph 4 hereof. If
Tenant fails to notify Landlord in writing of Tenant's approval of such Change
Order Request within said five (5) business day period, then such Change Order
Request shall be deemed to be withdrawn and shall be of no further effect.

                  (iii)    If Tenant at any time desires to make any changes,
alterations or additions to the Tenant's Approved Plans, such changes,
alterations or additions shall be subject to approval by Landlord in the same
manner as the original Tenant's Approved Plans as provided above.

                                      C-5
<Page>

3.       COMPLETION.

         (a)      When Landlord receives written certification from Architect
that construction of the foundation, structural slab on grade (except to the
extent delayed at Tenant's request to accommodate Tenant's design requirements
and/or any underslab aspects of Tenant's Work), Landlord's underslab plumbing
work, structural steel framework, decking and concrete on second and third
floors, roof structure and installation of main fire sprinkler risers in the
Building have been completed in accordance with the Landlord's Approved Plans,
Landlord shall prepare and deliver to Tenant a certificate signed by both
Landlord and Architect (the "STRUCTURAL COMPLETION CERTIFICATE") certifying that
the construction of such portions of the Building has been substantially
completed in accordance with the Landlord's Approved Plans in all material
respects and specifying the date of that completion. The delivery of such
Structural Completion Certificate shall commence the running of the 180-day time
period until the Rent Commencement Date under Section 2.1 of the Lease.

         (b)      When Landlord receives written certification from Architect
that construction of the remaining Improvements constituting Landlord's Work has
been completed in accordance with the Landlord's Approved Plans (except for
Punch List Work), Landlord shall prepare and deliver to Tenant a certificate
signed by both Landlord and Architect (the "FINAL COMPLETION CERTIFICATE")
certifying that the construction of the remaining Improvements constituting
Landlord's Work has been substantially completed in accordance with the
Landlord's Approved Plans in all material respects, subject only to completion
of Punch List Work, and specifying the date of that completion. Upon receipt by
Tenant of the Final Completion Certificate, the Improvements constituting
Landlord's Work will be deemed delivered to Tenant for all purposes of the Lease
(subject to Landlord's continuing obligations with respect to the Punch List
Work).

         (c)      Notwithstanding any other provisions of this Workletter or of
the Lease, if Landlord is delayed in substantially completing any of Landlord's
Work necessary for issuance of the Structural Completion Certificate as a result
of any Tenant Delay, then the 180-day period between the delivery of the
Structural Completion Certificate and the Rent Commencement Date pursuant to
Section 2.1 of the Lease shall be reduced, day for day, by the number of days by
which such Tenant Delay delayed completion of the portions of Landlord's Work
necessary for issuance of the Structural Completion Certificate, and Tenant
shall reimburse Landlord in cash, within fifteen (15) days after written demand
by Landlord (accompanied by reasonable documentation of the items claimed), for
any increased construction-related costs and expenses actually incurred by
Landlord as a result of the Tenant Delay, if any.

         (d)      At any time within thirty (30) days after delivery of the
Structural Completion Certificate or the Final Completion Certificate, as
applicable, Tenant shall be entitled to submit one or more lists to Landlord
specifying Punch List Work to be performed on the applicable Improvements
constituting Landlord's Work, and upon receipt of such list(s), Landlord shall
diligently complete such Punch List Work at Landlord's sole expense. In the
event of any dispute as to completion of any item or component of Landlord's
Work, the certificate of Landlord's Architect shall be conclusive. Promptly
after Landlord provides Tenant with the Final Completion Certificate, Landlord
shall cause the recordation of a Notice of Completion (as defined in Section
3093 of the California Civil Code) with respect to Landlord's Work.

                                      C-6
<Page>

4.       PAYMENT OF COSTS.

         (a)      LANDLORD'S WORK. Except as otherwise expressly provided in
this Workletter (including, but not limited to, the cost allocations set
forth in SCHEDULE C-2 attached hereto) or by mutual written agreement of
Landlord and Tenant, the cost of construction of Landlord's Work shall be
borne by Landlord at its sole cost and expense, including any costs or cost
increases incurred as a result of Unavoidable Delays, governmental
requirements or unanticipated conditions; PROVIDED, however, that
notwithstanding any other provisions of this Paragraph 4(a), to the extent
the Cost of Improvement relating to the construction of any item or component
of Landlord's Work is increased as a result of any implemented Change Order
Request or any Tenant Delay, or as a result of any "above standard" Building
Shell components requested by Tenant or otherwise necessitated by Tenant's
particular use requirements or by the contemplated Tenant's Work, or as a
result of any other plan changes or compliance costs attributable to Tenant's
particular use requirements or to the contemplated Tenant's Work, the amount
of the increase in the Cost of Improvement with respect to such item or
component shall be reimbursed by Tenant to Landlord in cash or, by mutual
agreement of Landlord and Tenant, may be deducted from Landlord's maximum
obligation under Paragraph 4(b) with respect to the cost of Tenant's Work.

         (b)      TENANT'S WORK. Except as otherwise expressly provided in
this Workletter (including, but not limited to, the cost allocations set
forth in SCHEDULE C-2 attached hereto) or by mutual written agreement of
Landlord and Tenant, (i) the cost of construction of the Tenant Improvements
shall be borne by Landlord up to a Cost of Improvements of $100.00 per square
foot of space in the Building (measured in accordance with Section 3.1(d) of
the Lease) for such Tenant Improvements and (ii) any cost of construction of
the Tenant Improvements in excess of $100.00 per square foot of space in the
Building for such Tenant Improvements up to a maximum additional cost of
$30.00 per square foot shall be borne fifty percent (50%) by Landlord and
fifty percent (50%) by Tenant, equating to a maximum total contribution by
Landlord to the Cost of Improvements for the Tenant Improvements of $115.00
per square foot (the "TENANT IMPROVEMENT ALLOWANCE") if the total Cost of
Improvements for the Tenant Improvements is $130.00 per square foot. Tenant
shall be responsible, at its sole cost and expense, for payment of fifty
percent (50%) of the first $30.00 per square foot of the Cost of Improvements
of the Tenant Improvements in excess of $100.00 per square foot, for the
entire Cost of Improvements of the Tenant Improvements in excess of $130.00
per square foot (if any such excess occurs) and for the entire cost of any
Tenant's Work that is not part of the Tenant Improvements, including (but not
limited to), in each case, any costs or cost increases incurred as a result
of Unavoidable Delays, governmental requirements or unanticipated conditions.
The rental schedule set forth in Section 3.1(a) of the Lease is subject to
adjustment based on the Cost of Improvements of the Tenant Improvements, to
the extent the total final contribution of Landlord toward the Cost of
Improvements for the Tenant Improvements is less than $115.00 per square foot
but not less than $100.00 per square foot, in accordance with the provisions
of Section 3.1(e) of the Lease. The funding of Landlord's share of the Cost
of Improvements for the Tenant Improvements (100% of the first $100.00 per
square foot of such Cost of Improvements and 50% of each $1.00 per square
foot of such Cost of Improvements in excess of $100.00 per square foot but
not in excess of $130.00 per square foot) shall be made on a monthly basis or
at other convenient intervals mutually approved by Landlord and Tenant and
shall be based on such disbursement conditions and procedures as Landlord and
Landlord's lender (if any) may reasonably prescribe, including (but not
limited to), as to the shared portion of such Cost of Improvements, prior or
concurrent payment of Tenant's share of the applicable Cost of Improvements.
Notwithstanding any other provisions of this Paragraph 4(b), to the extent
any amounts are deducted from or charged against the Tenant Improvement
Allowance pursuant to the final sentence of Paragraph 4(a) hereof, whether as
a result of implemented Change Order Requests, Tenant Delays and/or
Unavoidable Delays or otherwise, such amounts shall result in a reduction of
the first ($100.00 per square foot) tranche of the Tenant Improvement
Allowance that is borne 100% by Landlord with respect to the Tenant
Improvements, and the application of the second tranche of the Tenant
Improvement Allowance ($30.00 per square foot, borne 50% by Landlord and 50%
by Tenant, up to a maximum contribution of $15.00 per square foot by
Landlord) with respect to the Tenant Improvements shall commence upon
exhaustion of the first tranche of the Tenant Improvement Allowance as so
reduced. The foregoing Tenant Improvement Allowance assumes a building
composed of a minimum of 60% laboratory space and a maximum of 40% office
space, and

                                      C-7
<Page>

is subject to reduction (and/or to disapproval by Landlord of Tenant's
proposed plans and specifications for the Tenant Improvements) if the
proposed laboratory space is less than 60% of the square footage of the
Building.

5.       TENANT'S WORK. On or before the applicable Work Deadline (subject to
Landlord Delays and Unavoidable Delays, if any), Tenant shall construct and
install in the Building the Tenant's Work, substantially in accordance with
the Tenant's Approved Plans or, with respect to Tenant's Work not otherwise
shown on the Tenant's Approved Plans, substantially in accordance with plans
and specifications prepared by Tenant and approved in writing by Landlord
(which approval shall not be unreasonably withheld or delayed). Tenant's Work
shall be performed in accordance with, and shall in all respects be subject
to, the terms and conditions of the Lease (to the extent not inconsistent
with this Workletter), and shall also be subject to the following conditions:

         (a)      CONTRACTOR REQUIREMENTS. The contractor engaged by Tenant
for Tenant's Work, and any subcontractors, shall be duly licensed in
California and shall be subject to Landlord's prior written approval, which
approval shall not be unreasonably withheld or delayed. Tenant shall engage
only union contractors for the construction of Tenant's Work and for the
installation of Tenant's fixtures and equipment in the Building, and shall
require all such contractors engaged by Tenant, and all of their
subcontractors, to use only union labor on or in connection with such work,
except to the extent Landlord determines, in its reasonable discretion, that
the use of non-union labor would not create a material risk of labor
disputes, picketing or work interruptions at the Site, in which event
Landlord shall, to that extent, waive such union labor requirement.

         (b)      COSTS AND EXPENSES OF TENANT'S WORK. Subject to Landlord's
payment or reimbursement obligations under Paragraph 4(b) hereof with respect
to Landlord's share of the Cost of Improvements for the Tenant Improvements,
Tenant shall promptly pay all costs and expenses arising out of the
performance of Tenant's Work (including the costs of permits) and shall
furnish Landlord with evidence of payment on request. Tenant shall provide
Landlord with ten (10) days prior written notice before commencing any
Tenant's Work. On completion of Tenant's Work, Tenant shall deliver to
Landlord a release and unconditional lien waiver executed by each contractor,
subcontractor and materialman involved in the performance of Tenant's Work.

         (c)      TENANT'S INDEMNIFICATION. Tenant shall indemnify, defend
(with counsel reasonably satisfactory to Landlord) and hold Landlord harmless
from all suits, claims, actions, losses, costs and expenses (including, but
not limited to, claims for workers' compensation, attorneys' fees and costs)
based on personal injury or property damage or contract claims (including,
but not limited to, claims for breach of warranty) arising from the
performance of Tenant's Work. Tenant shall repair or replace (or, at
Landlord's election, reimburse Landlord for the cost of repairing or
replacing) any portion of the Improvements and/or any of Landlord's real or
personal property or equipment that is damaged, lost or destroyed in the
course of or in connection with the performance of Tenant's Work.

         (d)      INSURANCE. Tenant's contractors shall obtain and provide to
Landlord certificates evidencing workers' compensation, public liability and
property damage insurance in amounts and forms and with companies
satisfactory to Landlord.

         (e)      RULES AND REGULATIONS. Tenant and Tenant's contractors
shall comply with any other rules, regulations and requirements that Landlord
or General Contractor may reasonably impose with respect to the performance
of Tenant's Work. Tenant's agreement with Tenant's contractors shall require
each contractor to provide daily cleanup of the construction area to the
extent that such cleanup is necessitated by the performance of Tenant's Work.

         (f)      EARLY ENTRY. Landlord shall permit entry of contractors
into the Building for the purposes of performing Tenant's Work, subject to
satisfaction of the conditions set forth in the

                                      C-8
<Page>

Lease. This license to enter is expressly conditioned on the contractor(s)
retained by Tenant working in harmony with, and not unreasonably interfering
with, the workers, mechanics and contractors of Landlord. If at any time the
entry or work by Tenant's contractor(s) causes any material interference with
the workers, mechanics or contractors of Landlord, permission to enter may be
withdrawn by Landlord immediately on written notice to Tenant.

         (g)      RISK OF LOSS. All materials, work, installations and
decorations of any nature brought onto or installed in the Building, by or at
the direction of Tenant or in connection with the performance of Tenant's
Work, before the commencement of the Term shall be at Tenant's risk, and
neither Landlord nor any party acting on Landlord's behalf shall be
responsible for any damage, loss or destruction thereof, unless caused by
Landlord's or its agents', employees' or contractors' gross negligence or
willful misconduct.

         (h)      CONDITION OF TENANT'S WORK. All work performed by Tenant
shall be performed in a good and workmanlike manner, shall be free from
defects in design, materials and workmanship, and shall be completed in
compliance with the plans approved by Landlord for such Tenant's Work in all
material respects and in compliance with all applicable governmental laws,
ordinances, codes and regulations in force at the time such work is
completed. Without limiting the generality of the foregoing, Tenant shall be
responsible for compliance of all Improvements designed and constructed by
Tenant with the requirements of the Americans with Disabilities Act and all
similar or related requirements pertaining to access by persons with
disabilities.

6.       LANDLORD'S INDEMNIFICATION. Landlord shall indemnify, defend (with
counsel reasonably satisfactory to Tenant) and hold Tenant harmless from all
suits, claims, actions, losses, costs and expenses (including, but not
limited to, claims for workers' compensation, attorneys' fees and costs)
based on personal injury or property damage or contract claims (including,
but not limited to, claims for breach of warranty) arising from the
performance of Landlord's Work. Landlord shall repair or replace (or, at
Tenant's election, reimburse Tenant for the cost of repairing or replacing)
any portion of the Tenant Improvements and/or any of Tenant's real or
personal property or equipment that is damaged, lost or destroyed in the
course of or in connection with the performance of Landlord's Work.

7.       NO AGENCY. Nothing contained in this Workletter shall make or
constitute Tenant as the agent of Landlord.

8.       SURVIVAL. Without limiting survival provisions which would otherwise
be implied or construed under applicable law, the provisions of Paragraph
5(c) of this Workletter shall survive the termination of the Lease with
respect to matters occurring prior to expiration of the Lease.

9.       MISCELLANEOUS. All references in this Workletter to a number of days
shall be construed to refer to calendar days, unless otherwise specified
herein. In all instances where Tenant's approval is required, if no written
notice of disapproval is given within the applicable time period, at the end
of that period Tenant shall be deemed to have given approval (unless the
provision requiring Tenant's approval expressly states that non-response is
deemed to be a disapproval or withdrawal of the pending action or request, in
which event such express statement shall be controlling over the general
statement set forth in this sentence) and the next succeeding time period
shall commence. If any item requiring approval is disapproved by Tenant in a
timely manner, the procedure for preparation of that item and approval shall
be repeated.

         IN WITNESS WHEREOF, the parties have executed this Workletter
concurrently with and as of the date of the Lease.

                                      C-9
<Page>

           "Landlord"                                    "Tenant"

SLOUGH BTC, LLC, a Delaware limited            EOS BIOTECHNOLOGY, INC., a
liability company                              Delaware corporation

By:   SLOUGH ESTATES USA INC., a
      Delaware corporation, Its Manager        By:
                                                  ------------------------------
                                                  David W. Martin, Jr., M.D.
                                                  President and CEO

      By:                                      By:
          -----------------------------            -----------------------------
      Its:                                     Its:
          -----------------------------            -----------------------------

                                      C-10
<Page>

                           SCHEDULE C-1 TO WORKLETTER

                                 BUILDING SHELL

The "BUILDING SHELL" as defined in the Workletter to which this SCHEDULE C-1
is attached shall consist of the following:

Building envelope and waterproofing (the Building "shell"), except as
specifically indicated as being included in Tenant Improvements under
SCHEDULE C-2, including: foundation system consisting of reinforced concrete
grade beams on epoxy coated steel H piles, strip mat foundation, or other
engineered foundation system that is selected and designed based upon
existing site conditions; ground floor to be a reinforced concrete structural
slab or slab on grade (depending on the extent of overexcavation and
recompaction necessary due to existing conditions); second and third floors
to have metal decking with concrete topping slab; roof structure to be metal
deck with concrete for mass dampening in areas to receive mechanical
equipment, and to include a mechanical penthouse enclosure; roof membrane to
be built-up system, four-ply including mineral fiber cap sheet, with flashing
and sealants; building structural framing to consist of steel beams, girders,
columns with a non-bearing exterior curtain wall; seismic system utilizing
steel braced frames; floor system designed with live load capacity of 100
psf; roof live load to be 20 psf with minimum of 50 psf (more if required) in
all areas within the roofscreen and mechanical penthouse; floor to floor
heights of 17 feet

All other structural work except that driven specifically by Tenant
Improvements programming (e.g., interior masonry walls)

Main Building entrances

Building code required primary structure fireproofing

Building code required stairs

Pit and jack for elevator; framed openings at 2nd and 3rd floors;
pits/openings sized for 5'8" x 8'5" deep inside clear dimension if Tenant
provides elevator selection information prior to September 15, 2001 (two
weeks prior to estimated date for completion of construction documents for
shell as specified in EXHIBIT D)

Exterior hardscape and landscape, except as specifically included in Tenant
Improvements under SCHEDULE C-2

Polyethylene vapor barrier under slab on grade

Site underground water, fire, storm and sanitary service to 5' outside
Building line

Building storm and overflow drainage systems

Site underground conduits for "normal" electrical and communications,
terminated within the Building

Electrical utility pad and transformer, and primary and secondary service
conduits terminated at building switchgear location for TI-provided
electrical service. Anticipated sizing for this building is a 3000A service,
unless not approved by PG&E based on Tenant loads and demands

Gas service to exterior meter at Building

Wet fire protection (risers, loops, branches and heads),1 evenly distributed
for "ordinary hazard - group 2" occupancy Shell design and permitting fees,
except as specifically included in Tenant Improvements under SCHEDULE C-2

                           Schedule C-1 - Page 1 of 2
<Page>

Temporary project fencing

Construction lift for contractor access and stocking of materials (split with
TI - 50%)

Underslab main trunk line for sanitary waste

Rigid roof insulation

                           Schedule C-1 - Page 2 of 2
<Page>

                           SCHEDULE C-2 TO WORKLETTER

                               TENANT IMPROVEMENTS

The "TENANT IMPROVEMENTS" as defined in the Workletter to which this SCHEDULE
C-2 is attached shall include, but not necessarily be limited to, the
following:

All tenant construction, design fees, fixtures, furnishings, etc. to support
tenant operations, including use space, offices, lobbies, circulation,
restrooms and all other features not indicated as part of the Building Shell
in SCHEDULE C-1

Service yard foundations, structure, enclosure and waterproofing

Shipping/receiving/dock equipment and bollards

Exterior Building skin modifications to support TI systems (e.g., louvers for
HVAC accommodation)

Outdoor lounge and eating area

Topical emission barriers at slab on grade, if required

Slab depressions for special finishes or special uses

Enhancement of structure for live loading above 100 PSF or vibration control
criteria

Modification of structure for openings at floors and roof

Modification of structure fireproofing required by TI construction

All minor support structures for ducts, conduits, pipes, etc.

Stair enclosures

Stair penthouse, if required

Exterior wall insulation

Firesafing at floor decks, exterior wall and interior openings

Custom doors

Security or other upgrades to exterior doors

Wallboard capture trim at exterior window wall

Visual screens for rooftop equipment

Supports, sleepers, etc. for all rooftop equipment, ducts, plumbing,
electrical, etc.

Roof patching for all penetrations

Skylights, if used, including curbs, roof patching, etc.

Elevator cab and equipment, except for pit and jack

                           Schedule C-2 - Page 1 of 2
<Page>

Shaft walls or other fire separations required for vertical openings (stairs,
elevators) or control zones

Distribution/laterals from Building main trunk line for sanitary waste

All underground plumbing (main trunk line and distribution/laterals) and related
systems and fixtures for lab waste

Modifications/enhancements to wet fire protection systems required by TI design

Fire alarm and signal systems

All secondary electrical service for Tenant demand loads, including 3000A main
service disconnect, Tenant meter section and distribution panels

Standby electrical generator, if required

All electrical communications wire and service not included in Building Shell

All TI design fees and reimbursables

All other "soft" costs, including TI permit/development fees, utility capacity
or connection charges, etc.

Landlord-provided project management of TI activities (not to exceed a
maximum amount equal to two percent (2%) of the Tenant Improvement Allowance
funded by Landlord)

All testing and inspection of TI construction

Builders risk insurance for TI construction

All general contractor preconstruction services costs related to TI construction

Construction lift for contractor access and stocking of materials (split with
shell - 50%)

                           Schedule C-2 - Page 2 of 2
<Page>

                                    EXHIBIT D

                         ESTIMATED CONSTRUCTION SCHEDULE
<Table>
<S>                  <C>                                                      <C>

[Hathaway                  BRITANNIA OYSTER POINT                                      Slough Estates USA, Inc.]
Dinwiddie LOGO]       OYSTER POINT, SOUTH SAN FRANCISCO                       Project Management Advisors, Inc.
                             BUILDING D (81,223 SF)                                       Chamorro Design Group
                                LEASE EXHIBIT D                                           Revised Final-5/25/01
                                  MAY 25 2001
</Table>

<Table>
<Caption>

   ID     Task Name                                                               Dur       Start         Finish          %
<S>       <C>                                                                    <C>      <C>           <C>             <C>
   1      BRITANNIA OYSTER POINT                                                   139W   WED 6/7/00     SAT 3/1/03      24%
  322          BUILDING D                                                         91.8W   FRI 2/9/01    SAT 11/30/02      5%
  323             SHELL DESIGN                                                    32.8W   FRI 2/9/01    MON 10/1/01      39%
  324                Schematic Design                                              7.2w   Fri 2/9/01    Fri 3/30/01     100%
  325                Steel Package                                                   8w   Mon 4/2/01    Fri 5/25/01      55%
  326                Design Development                                            9.8w   Mon 4/2/01     Fri 6/8/01      45%
  327                Grading / Utility Package                                       0w   Fri 6/8/01     Fri 6/8/01       0%
  328                Construction Documents                                         16w   Fri 6/8/01    Mon 10/1/01       0%
  329             PERMITS                                                         12.6W   TUE 10/2/01    WED 1/2/02       0%
  330                Building Permit Review                                       12.6w   Tue 10/2/01    Wed 1/2/02       0%
  331                Building Permit                                                 0w   Wed 1/2/02     Wed 1/2/02       0%
  332             SUBMITTALS / PROCUREMENT                                          43W   MON 4/30/01    TUE 3/5/02       1%
  333                Early Involvement Steel Subcontractor                           4w   Mon 4/30/01   Fri 5/25/01      10%
  334                Steel Reservation (Latest Date)                                 0d   Tue 8/7/01     Tue 8/7/01       0%
  335                Procure Steel                                                  29w   Wed 8/8/01     Tue 3/5/02       0%
  336             SHELL CONSTRUCTION                                              35.8W  MON 12/17/01   WED 8/28/02       0%
  337                Winterization / Mobilization                                    2w  Mon 12/17/01   Mon 12/31/01      0%
  338                Drive Piles                                                   2.8w   Wed 1/2/02    Mon 1/21/02       0%
  339                Excavate Pile Caps & Grade Beams                                2w   Wed 1/9/02    Tue 1/22/02       0%
  340                Set Templates / Forming                                         2w   Wed 1/16/02   Tue 1/29/02       0%
  341                Pour 1st 1/2 Pile Caps & Grade Beams                            1d   Tue 1/22/02   Tue 1/22/02       0%
  342                Pour 2nd 1/2 Pile Caps & Grade Beams                            1d   Tue 1/29/02   Tue 1/29/02       0%
  343                T.I. U'slab, decks & Roof Required                              0w   Tue 1/22/02   Tue 1/22/02       0%
  344                U'gnd Utilities                                               4.7w   Wed 1/30/02    Mon 3/4/02       0%
  345                SOG                                                           4.2W   THU 4/18/02   THU 5/16/02       0%
  346                     Edge Forms 1st half SOG                                    7d   Thu 4/18/02   Fri 4/26/02       0%
  347                     Under Slab Plumbing                                       20d   Thu 4/18/02   Wed 5/15/02       0%
  348                     Rebar 1st Half SOG                                         7d   Mon 4/29/02    Tue 5/7/02       0%
  349                     Pour 1st Half SOG                                          1d   Wed 5/8/02     Wed 5/8/02       0%
  350                     Edge Forms 2nd Half SOG                                    7d   Wed 5/1/02     Thu 5/9/02       0%
  351                     Rebar 2nd Half SOG                                         7d   Wed 5/8/02    Thu 5/16/02       0%
  352                     Pour 2nd Half SOG                                          0d   Thu 5/16/02   Thu 5/16/02       0%
  353                STRUCTURAL CONSTRUCTION                                        12W   WED 3/6/02    WED 5/29/02       0%
  354                     Erect, Bolt & Weld Structural Steel                        2w   Wed 3/6/02    Tue 3/19/02       0%
  355                     Metal Decking                                            3.4w   Mon 3/18/02    Tue 4/9/02       0%
  356                     Prep 2nd Deck                                              4d   Mon 4/1/02     Thu 4/4/02       0%
  357                     Pour 2nd Deck                                              1d   Fri 4/5/02     Fri 4/5/02       0%
  358                     Prep 3rd Deck                                              4d   Mon 4/8/02    Thu 4/11/02       0%
  359                     Pour 3rd Deck                                              1d   Fri 4/12/02   Fri 4/12/02       0%
  360                     Prep Roof                                                 17d   Thu 3/28/02   Fri 4/19/02       0%
  361                     Pour Roof                                                  1d   Mon 4/22/02   Mon 4/22/02       0%
  362                     Pour stair #1 (1 thru Roof)                                1d   Mon 4/8/02     Mon 4/8/02       0%
  363                     Pour Stair #2 (1 thru 3)                                   1d   Mon 4/15/02   Mon 4/15/02       0%
  364                     Fireproofing                                               5w   Fri 4/19/02   Thu 5/23/02       0%
  365                     Roofing                                                    3w   Tue 4/23/02   Mon 5/13/02       0%
  366                     F/S Risers                                                 2w   Wed 5/15/02   Wed 5/29/02       0%
  367                Start Curtain Wall                                              0w   Fri 5/17/02   Fri 5/17/02       0%
  368                Structural Completion                                           0w   Fri 5/31/02   Fri 5/31/02       0%
  369                Complete Construction                                        12.4w   Mon 6/3/02    Wed 8/28/02       0%
  370                Shell Complete                                                  0w   Wed 8/28/02   Wed 8/28/02       0%
  371             TENANT DESIGN (TARGET)                                            49W   THU 6/14/01   FRI 5/31/02       0%
  372                TI Programming                                                 12w   Thu 6/14/01    Fri 9/7/01       0%
  373                Schematic Design                                               12w   Fri 8/31/01   Tue 11/27/01      0%
  374                Details of all Tenant U'gnd Utilities & Struct. Const.          0w   Mon 11/5/01   Mon 11/5/01       0%
                     Changes
  375                Owner / Tenant Approval of Schematic Package                    3w  Mon 11/19/01   Tue 12/11/01      0%
  376                Owner / Tenant Approved Tenant U'gnd Util. & Struct.            0w  Tue 12/11/01   Tue 12/11/01      0%
                     Const. Changes
  377                TI Design Development / Construction Documents                 14w  Mon 11/19/01   Thu 2/28/02       0%
  378                TI Permit                                                      12w   Fri 3/8/02    Fri 5/31/02       0%
  379             TENANT CONSTRUCTION (TARGET)                                      25W   MON 6/3/02    SAT 11/30/02      0%
  380                Tenant Construction                                          180ed   Mon 6/3/02    Sat 11/30/02      0%
  381             Building D Move-in (Target)                                       0ew  Sat 11/30/02   Sat 11/30/02      0%
</Table>

                                      D-1
<Page>

                                    EXHIBIT E

                    ACKNOWLEDGMENT OF RENT COMMENCEMENT DATE

This Acknowledgment is executed as of _________________, ____, by SLOUGH BTC,
LLC, a Delaware limited liability company ("Landlord"), and EOS BIOTECHNOLOGY,
INC., a Delaware corporation ("Tenant"), pursuant to Section 2.4 of the
Build-to-Suit Lease dated June 1, 2001 between Landlord and Tenant (the "Lease")
covering premises located at 1150 Veterans Boulevard, South San Francisco, CA
94080 (the "Building").

Landlord and Tenant hereby acknowledge and agree as follows:

1.       The Rent Commencement Date under the Lease is __________________,_____.

2.       The termination date under the Lease shall be _________________, _____,
subject to any applicable provisions of the Lease for extension or early
termination thereof.

3.       The square footage of the Building, as finally designed and built,
measured in accordance with Section 3.1(d) of the Lease, is _________ square
feet.

4.       Tenant accepts the Building and acknowledges the satisfactory
completion of all Improvements therein required to be made by Landlord, subject
only to (a) any applicable "punch list" or similar procedures specifically
provided under the Lease or under the Workletter governing such work, and (b)
Landlord's warranties and representations set forth in Section 5.2 of the Lease.

EXECUTED as of the date first set forth above.

"Landlord"                                                "Tenant"

SLOUGH BTC, LLC, a Delaware limited          EOS BIOTECHNOLOGY, INC., a Delaware
liability company                            corporation

By:   Slough Estates USA Inc., a Delaware
      corporation, Its Manager               By:
                                                 -------------------------------
                                                 David W. Martin, Jr., M.D.
                                                 President and CEO

By:                                          By:
      -----------------------------------        -------------------------------
Its:                                         Its:
      -----------------------------------        -------------------------------

                                      E-1<Page>

                                                                    Exhibit 10.3

                             COLLABORATION AGREEMENT

This Agreement is entered into as of June 4, 2001, by and between:

         SEATTLE GENETICS, INC., a Delaware corporation, having its principal
         place of business at 22215 26th Avenue S.E., Suite 3000, Bothell,
         Washington 98021

         (hereinafter referred to as "SGI")

AND:

         EOS BIOTECHNOLOGY, INC., a Delaware corporation, having its principal
         place of business at 225A Gateway Blvd, S. San Francisco, California
         94080

         (hereinafter referred to as "EOS").

                                   WITNESSETH

         WHEREAS, SGI owns or controls intellectual property rights relating to
certain drug conjugation and linker technology;

         WHEREAS, EOS is currently conducting research and development programs
aimed at the discovery of antigens and the development of antibodies targeting
those antigens;

         WHEREAS, EOS wishes to acquire from SGI exclusive options to worldwide
exclusive licenses under SGI's patent rights and know-how related to SGI's drug
conjugation and linker technology;

         WHEREAS, SGI is willing to grant to EOS such exclusive options in order
to allow EOS to evaluate SGI's drug conjugation and linker technology for use
with certain of EOS's proprietary antigens and antibodies, and

         WHEREAS, SGI is willing to grant to EOS such exclusive licenses,
subject to the terms of and conditioned upon this Agreement.

         NOW, THEREFORE, in consideration of the mutual covenants and
obligations set forth herein, the Parties hereto, intending to be legally bound,
agree as follows:

ARTICLE I - DEFINITIONS AND INTERPRETATION

         1.1.     DEFINITIONS: For the purposes of this Agreement the following
words and phrases shall have the following meanings:

<Page>

                  "ADC" means any Antibody or Control Antibody that incorporates
or uses Drug Conjugation Technology.

                  "AFFILIATE" means, with respect to a Party, any person,
corporation or business entity that directly, or indirectly through one or more
intermediaries, controls, is controlled by, or is under common control with, a
Party. For the purpose of this definition, control of a corporation or of
another business entity shall mean the possession, directly or indirectly, of
the power to direct or cause the direction of the management or the policies of
the entity, whether through the ownership of voting securities, by agreement or
otherwise; PROVIDED, HOWEVER, that the direct or indirect beneficial ownership
of less than [***] percent ([***]) of the voting interests in, or less than a
[***] percent ([***]) interest in the equity of, such corporation or other
business entity shall not alone constitute control of such corporation or other
business entity.

                  "AGREEMENT" means this agreement, all amendments and
supplements to this Agreement and all schedules to this Agreement, including the
following:

                           SCHEDULE A    -    Drug Conjugation Technology Field;
                           SCHEDULE B    -    Licensed Patents;
                           SCHEDULE C    -    Research Antigens;
                           SCHEDULE D    -    ADC Preparation Terms; and
                           SCHEDULE E    -    SGI In-Licenses

                  "ANTIBODY" or "ANTIBODIES" means any monoclonal antibody
[***], or fragment thereof, with a unique amino acid sequence that binds to a
Research Antigen or Exclusive Antigen. By way of clarification, Antibodies with
different amino acid sequences shall be deemed to be different Antibodies,
irrespective of whether they bind to the same Research Antigen or Exclusive
Antigen.

                  "ANTIGEN" means any protein (including any glyco- or
lipo-protein), carbohydrate, compound or other composition, and any fragment,
peptide or epitope thereof, to which an antibody binds.

                  "CALENDAR QUARTER" means any of the three-month periods
beginning January 1, April 1, July 1 and October 1 in any year.

                  "CONFIDENTIAL INFORMATION" has the meaning ascribed to it in
Section 10.1. of this Agreement.

                  "CONTROL ANTIBODY" shall have the meaning set forth in Section
3.5.

                  "COST OF GOODS" shall mean with respect to Drug Conjugate
Materials manufactured and supplied to EOS (i) if by Third-Parties, [***] in
such manufacture and supply of Drug Conjugate Materials; and (ii) if by SGI or
its Affiliates, [***] Percent ([***]%) of the consolidated fully burdened cost
of providing such goods or services which shall be limited to the following
factors: [***]

----------
[***] CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.

                                      -2-
<Page>

[***] costs and expenses other than those remitted by EOS in accordance to the
terms and conditions of this Agreement (including royalties, license fees,
milestone payments and other payment obligations) paid to Third-Parties with
respect to providing such goods and services.

                  "DRUG CONJUGATE MATERIALS" means research grade small
molecular weight cytotoxic drugs, including [***], and linkers for attaching
drugs to proteins, specifically monoclonal antibodies and fragments thereof.

                  "DRUG CONJUGATION TECHNOLOGY" means drug conjugation chemistry
owned or controlled by SGI, including [***] and linker technology for attaching
drugs to Antibodies that is the subject matter of the Licensed Patents and SGI
Know-How.

                  "EFFECTIVE DATE" means the date of this Agreement.

                  "EOS PATENTS" shall have the meaning set forth in Section
11.2.2.

                  "EVENTS OF FORCE MAJEURE" shall have the meaning set forth in
Article 17.

                  "EXCLUSIVE ANTIGEN" shall have the meaning set forth in
Section 4.2.1.

                  "EXCLUSIVE LICENSE" has the meaning ascribed to it in Section
4.2.1 of this Agreement.

                  "FIELD" means any and all [***] applications for human [***]
use, unless mutually agreed to by the Parties and set forth in SCHEDULE A.

                  "FIRST COMMERCIAL SALE" means, in each country of the
Territory, the first commercial sale, where sale means when delivered, billed
out, or invoiced, whichever comes first, of a Product by EOS, its Affiliates or
Sublicensees to a Third-Party (other than a Sublicensee) following Regulatory
Approval in the country in which the sale is to be made.

                  "IMPROVEMENTS" means all patentable or non-patentable
inventions, discoveries, technology and information of any type whatsoever,
including compositions, chemical compounds, biological materials, methods,
processes, technical information, knowledge, experience and know-how which (i)
utilize, incorporate, derive from, are based on or relate to the [***], (ii) add
to the knowledge of the [***], or (iii) help mastering or enhancing [***] or
using the [***] in combination with [***].

                  "INITIAL RESEARCH PROGRAM FEE" has the meaning ascribed to it
in Section 3.4(a) hereof.

----------
[***] CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.

                                      -3-
<Page>

                  "INITIATION" means, with respect to a human clinical trial,
the treatment of the first patient with a Product pursuant to a clinical
protocol of the specified clinical trial.

                  "LICENSED PATENTS" means:

                           (i)      any existing patents and patent applications
listed in SCHEDULE B to this Agreement;

                           (ii)     any patents and patent applications covering
[***], and covering [***] to the extent included in this Agreement pursuant to
[***];

                           (iii)    any future patents issued from any patent
applications referred to above and any future patents issued from a patent
application filed in any country in the Territory which corresponds to a patent
or patent application identified above; and

                           (iv)     any reissues, confirmations, renewals,
extensions, counterparts, divisions or continuations issued, assigned or
licensed to SGI of or relating to the patents or patent applications identified
above.

                  "NET SALES" means the gross amount received by EOS, its
Affiliates and Sublicensees from the sale or other disposition of Products to
Third-Parties (other than Sublicensees), less the sum of the following
deductions for amounts actually incurred related to said sale or other
disposition:

                  (i)      normal, customary trade discounts (including volume
discounts), credits and allowances and adjustments for rejections, recalls and
returns;

                  (ii)     cost of freight and insurance, sales, use, excise,
value added and similar taxes, surcharges, duties and other governmental charges
(other than income tax) imposed on the sale and included in the gross amount
charged to customers;

                  (iii)    normal, customary wholesaler chargebacks and rebates
(including rebates to government agencies and government mandates and managed
healthcare negotiated rebates); and

                  (iv)     retroactive price reductions; provided that no
deduction for retroactive price reductions shall be taken for the sale or
disposition of Products incorporating technology sublicensed under the [***].

                  "NEW TECHNOLOGIES" has the meaning ascribed in Section 4.3
hereof.

                  "OPTION" means, with respect to each Research Antigen, the
exclusive option granted by SGI to EOS pursuant to the provisions of Section 4.1
hereof to obtain an Exclusive License under Section 4.2 hereof.

                  "OPTION EXERCISE FEE" has the meaning ascribed to it in
Section 4.1.2 hereof.

----------
[***] CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.

                                      -4-
<Page>

                  "OPTION PERIOD" means, with respect to each Research Antigen,
the period commencing as of (i) the date that SGI delivers to EOS [***], or (ii)
the date that EOS informs SGI of [***], and continuing for a period of two (2)
years unless terminated earlier pursuant to the provisions of Article 15 herein.

                  "PARTIES" means EOS and SGI, and "Party" means any one of
them.

                  "PHASE I CLINICAL TRIAL" means a clinical study in subjects to
evaluate the pharmacokinetic and pharmacodynamic properties, maximum tolerated
dose, dosing interval, and absorption, distribution, metabolism and excretion of
a candidate drug.

                  "PHASE II CLINICAL TRIAL" means a controlled dose ranging
clinical trial to evaluate the efficacy and safety of a candidate drug in the
targeted patient population and to define the optimal dosing regimen.

                  "PHASE III CLINICAL TRIAL" means a series of controlled,
pivotal, multi-center clinical trials, involving patients with the disease or
condition of interest to obtain sufficient efficacy and safety data to support
regulatory submissions and labeling of a candidate drug.

                  "PHASE IV CLINICAL TRIAL" means human clinical trials
conducted for inclusion in (i) that portion of the FDA submission and approval
process which provides for continued trials of a Product after Regulatory
Approval has been achieved (such trials may be designed to provide information
that will optimize or expand use of the Product, provide information from
additional drug interaction, dose-response and safety studies, or provide
pharmacoeconomic, epidemiological, comparative efficacy or other data from
studies in a therapeutic use environment) and (ii) foreign equivalents thereof.

                  "PRODUCT" means any and all products where the manufacture,
sale or use of such products would have constituted a misappropriation of Drug
Conjugation Technology, SGI Know-How, Improvements or New Technologies, and/or
an infringement of the Licensed Patents but for the licenses granted in this
Agreement.

                  "REGULATORY APPROVAL" means final regulatory approval
(including, where applicable, pricing approval in the event that actual sales do
not take place before such approval) required to market a Product for a disease
or condition in accordance with the applicable laws and regulations of a given
country. In the United States, its territories and possessions, Regulatory
Approval means approval of a Biologics License Application ("BLA") or its
equivalent by the United States Food and Drug Administration ("FDA"), or
successor agency.

                  "RESEARCH ANTIGEN" means any Antigen that is [***] designated
a "RESEARCH ANTIGEN" under this Agreement pursuant to Section 2.1.

                  "RESEARCH PROGRAM" means the research program conducted
pursuant to Article 3.

----------
[***] CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.

                                      -5-
<Page>

                  "RESEARCH PROGRAM TERM" shall mean the term of the Research
Program set forth in Section 3.3.

                  "ROYALTY TERM" means, on a Product-by-Product and
country-by-country basis, the period of time equal to the longer of (a) ten (10)
years from the date of First Commercial Sale of the Product in such country or
(b) the term for which a Valid Patent Claim directly relating to the Product in
such country remains in effect.

                  "SECOND RESEARCH PROGRAM FEE" has the meaning ascribed to it
in Section 3.4(b) hereof.

                  "SGI IN-LICENSES" means the following agreements between SGI
and the indicated Third-Parties: (i) the License Agreement between [***] and SGI
dated [***], as amended (the "[***]"), (ii) the License Agreement between [***]
and SGI dated [***], as amended (the "[***]"), and (iii) [***].

                  "SGI KNOW-HOW" means any and all technical information,
processes, formulae, data, engineering, inventions, chemical compounds, know-how
and trade secrets, in each case that is Confidential Information according to
Article 10, that relate to the Drug Conjugation Technology and which have been,
or hereafter are during the term of this Agreement, either developed by SGI or
its Affiliates, or have been acquired by SGI or its Affiliates with the right to
grant licenses, immunities or other rights thereon.

                  "SGI TECHNOLOGY" means the Licensed Patents, the SGI Know-How,
Improvements to the extent included in this Agreement pursuant to Section 4.3.1
and New Technologies to the extent included in this Agreement pursuant to
Section 4.3.2.

                  "SUBLICENSEES" means any person acting pursuant to a
sublicense granted to it by EOS or its Affiliates under the terms of this
Agreement.

                  "TERM" has the meaning ascribed to it in Article 15

                  "TERRITORY" means all countries in the world.

                  "THIRD-PARTY" means any person other than EOS, SGI and their
respective Affiliates.

                  "THIRD RESEARCH PROGRAM FEE" has the meaning ascribed to it in
Section 3.4(c) hereof.

                  "VALID PATENT CLAIM" means a claim of an issued and unexpired
patent included in Licensed Patents or EOS Patents which has not been held
permanently revoked, unenforceable or invalid by a decision of a court or other
governmental agency of competent jurisdiction,

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THE OMITTED PORTIONS.

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unappealable or unappealed within the time allowed for appeal, and which has not
been admitted to be invalid or unenforceable through reissue or disclaimer or
otherwise.

         1.2.     CERTAIN RULES OF INTERPRETATION IN THIS AGREEMENT AND THE
                  SCHEDULES.

                  (a)      Unless otherwise specified, all references to
monetary amounts are to United States of America currency (US Dollars);

                  (b)      The descriptive headings of Articles and Sections are
inserted solely for convenience of reference and are not intended as complete or
accurate descriptions of the content of such Articles or Sections;

                  (c)      The use of words in the singular or plural, or with a
particular gender, shall not limit the scope or exclude the application of any
provision of this Agreement to such person or persons or circumstances as the
context otherwise permits;

                  (d)      The words "include" and "including" have the
inclusive meaning frequently identified with the phrases "without limitation"
and "but not limited to";

                  (e)      Whenever a provision of this Agreement requires an
approval or consent by a Party to this Agreement and notification of such
approval or consent is not delivered within the applicable time limit, then,
unless otherwise specified, the Party whose approval or consent is required
shall be conclusively deemed to have withheld its approval or consent;

                  (f)      Unless otherwise specified, time periods within or
following which any payment is to be made or act is to be done shall be
calculated by excluding the day on which the period commences and including the
day on which the period ends and by extending the period to the next business
day following if the last day of the period is not a business day in the
jurisdiction of the Party to make such payment or do such act; and

                  (g)      Whenever any payment is to be made or action to be
taken under this Agreement is required to be made or taken on a day other than a
business day, such payment shall be made or action taken on the next business
day following such day to make such payment or do such act.

ARTICLE 2 - RESEARCH ANTIGENS

         2.1.     DESIGNATION OF RESEARCH ANTIGENS.

         Subject to the provisions of this Agreement, including the availability
of the Antigen pursuant to Section 2.3, EOS may acquire Options pursuant to
Section 4.1 for the following number of Research Antigens during the term of the
Research Program:

                  (a)      Upon payment of the Initial Research Program Fee set
forth in Section 3.4(a), EOS may acquire Options for up to [***] Research
Antigens for evaluation in the Research Program.

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                                      -7-
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                  (b)      Upon payment of the Second Research Program Fee set
forth in Section 3.4(b), EOS may acquire Options for up to an additional [***]
Research Antigens for evaluation in the Research Program.

                  (c)      Upon payment of the Third Research Program Fee set
forth in Section 3.4(c), EOS may acquire Options for up to an additional [***]
Research Antigens for evaluation in the Research Program.

         EOS may acquire an Option for an Antigen by notifying SGI of the
identity of, and to the extent available the genetic sequence for, the Antigen
for which EOS wishes to acquire an Option. Within fourteen (14) days following
receipt of such EOS notice, SGI will notify EOS whether the Option requested by
EOS is available pursuant to Section 2.3.

         Upon notice by SGI to EOS that an Option is available for such Antigen
pursuant to Section 2.3, such Antigen shall be deemed to be a "RESEARCH ANTIGEN"
under this Agreement for the duration of the Option Period. SCHEDULE C to this
Agreement will be amended from time to time to list the Research Antigens
(including a description thereof) under this Agreement.

         2.2.     RESEARCH LICENSE TO EOS.

         Subject to the provisions of this Agreement, SGI hereby grants to EOS
and its Affiliates, for the term of the Research Program, an exclusive license
in the Territory under the SGI Technology solely for the purpose of conducting
research and development activities on the Research Antigens and evaluating
EOS's interest to exercise the Options. The research license granted to EOS
under this Section 2.2 shall not include (i) the right to use SGI Technology for
any commercial purpose whatsoever, (ii) the right to grant sublicenses thereto
to any Affiliate or Third-Party, (iii) the right to initiate any human clinical
trial in any country, or (iv) the right to make, have made, use or sell a
Product or the Drug Conjugation Technology for any purpose other than the
foregoing evaluation, including for any commercial purpose.

         2.3.     AVAILABILITY OF AN ANTIGEN.

         It is understood and agreed that SGI may be unable to grant an Option
or Exclusive License to an Antigen if, prior to EOS's request for an Option for
such Antigen pursuant to Section 2.1, (i) [***], or (ii) [***] EOS's written
request for an Option for the Antigen.

ARTICLE 3 - RESEARCH PROGRAM

         3.1.     OBJECTIVE. EOS intends to conduct a Research Program to
evaluate Research Antigens and Antibodies for commercial development under this
Agreement. In support of the Research Program, upon receipt of Antibodies from
EOS, SGI will prepare ADCs for EOS pursuant to Section 3.5.

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THE OMITTED PORTIONS.

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         3.2.     CONDUCT OF RESEARCH PROGRAM. EOS and SGI shall use all
reasonable efforts to complete research works in accordance with the stated
objective of the Research Program. Any research work performed by EOS and SGI
pursuant hereto shall be performed in a good scientific manner and in compliance
with all applicable laws.

         3.3.     TERM OF THE RESEARCH PROGRAM. The initial term of the Research
Program shall be for a period of three (3) years from the Effective Date (the
"INITIAL RESEARCH PROGRAM TERM"), unless terminated earlier upon termination of
this Agreement in accordance with Article 15 hereof. Subject to the written
approval of SGI and to payment of the fee by EOS to extend, as set forth in
Section 3.4(d) below, the Research Program will be extended for [***] additional
period of [***] upon EOS's request by giving written notice to SGI not less than
[***] prior to the expiration of the Initial Research Program Term (collectively
with the Initial Research Program Term, the "RESEARCH PROGRAM TERM").

         3.4.     RESEARCH PROGRAM FEES. EOS shall pay to SGI the following
amounts in consideration of the Research Program:

                  (a)      Upon execution and delivery of this Agreement by both
Parties, EOS shall pay to SGI a payment in the sum of [***] dollars ([***]) by
wire transfer of immediately available funds, which payment shall be
nonrefundable and non-creditable (the "INITIAL RESEARCH PROGRAM FEE").

                  (b)      If EOS elects to [***] Options [***] Options pursuant
to Section 2.1(b), EOS shall pay a second payment in the sum of [***] Dollars
($[***])by wire transfer of immediately available funds, which payment shall be
nonrefundable and non-creditable (the "SECOND RESEARCH PROGRAM FEE").

                  (c)      If EOS elects to [***] Options [***] Options pursuant
to Section 2.1(c), EOS shall pay a third payment in the sum of [***] Dollars
($[***]) by wire transfer of immediately available funds, which payment shall be
nonrefundable and non-creditable (the "THIRD RESEARCH PROGRAM FEE").

                  (d)      If EOS and SGI agree to extend the Research Program
for an additional [***] month period pursuant to Section 3.3, EOS shall pay an
additional payment in the sum of [***] Dollars ($[***]) by wire transfer of
immediately available funds, which payment shall be nonrefundable [***]

         3.5.     SGI PREPARATION OF ADCS.

         At the request of EOS during the Research Program Term, SGI will use
reasonable commercial efforts to prepare ADC's for (i) Antibodies provided by
EOS recognizing [***]and (ii) up to [***] antibody [***]

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                                      -9-
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("[***] ANTIBODY") per ADC being prepared; provided that the Antibody(ies) [***]
Antibody(ies) are provided to SGI at the same time; and provided further that
SGI may decline to prepare [***]. The terms and conditions applicable to SGI's
ADC preparation are set forth on SCHEDULE D. EOS shall pay SGI the amount set
forth in SCHEDULE D within thirty (30) days of receipt of an invoice from SGI
for such amounts. The Parties acknowledge and agree that SGI will prepare at
least the [***]. If SGI is unable to prepare an ADC within [***] months
following EOS's delivery of the required quantity of Antibody material (and if
applicable, Control Antibody material), EOS will have the option to designate a
replacement Antibody to the same Research Antigen (including a replacement
Control Antibody, if applicable) at any time during the Research Program Term
and SGI will use reasonable commercial efforts to prepare an ADC for such
replacement Antibody (and replacement Control Antibody, if applicable) for no
additional charge. EOS's right to designate a replacement Antibody (and
replacement Control Antibody, if applicable) is EOS's sole and exclusive remedy
for any failure by SGI to prepare any ADC contemplated by this Section 3.5.

         EXCEPT AS MAY BE OTHERWISE PROVIDED IN ARTICLE 14, SGI MAKES NO
REPRESENTATIONS AND GRANTS NO WARRANTIES, EXPRESS OR IMPLIED, EITHER IN FACT OR
BY OPERATION OF LAW, BY STATUTE OR OTHERWISE, REGARDING THE ADC'S PREPARED BY
SGI INCLUDING ANY WARRANTY OF QUALITY, MERCHANTABILITY OR FITNESS FOR A
PARTICULAR USE OR PURPOSE.

         3.6.     CONFIDENTIALITY. In order to facilitate the Research Program,
either Party may disclose confidential or proprietary information owned or
controlled by it to the other. It is hereby understood and agreed that such
information shall be deemed "CONFIDENTIAL INFORMATION" as defined in Article 10
and treated as such.

ARTICLE 4 - OPTIONS AND LICENSES

         4.1.     OPTION GRANT.

                  4.1.1.   GRANT OF THE OPTIONS. Subject to the provisions of
this Agreement, SGI hereby grants to EOS an exclusive Option for each Research
Antigen designated pursuant to Section 2.1 to obtain the Exclusive License set
forth in Section 4.2.1 during the Option Period.

                  4.1.2.   EXERCISE OF THE OPTION. At any time during the Option
Period with respect to a particular Research Antigen, EOS may provide notice to
SGI that it wishes to acquire an Exclusive License for the SGI Technology solely
for use with Products containing ADC's directed against the specified Research
Antigen. Upon the exercise of each Option, EOS shall make a payment to SGI in
the sum of [***] Dollars ($[***]) by wire transfer of immediately available
funds, which payment shall be nonrefundable and non-creditable (the "OPTION
EXERCISE FEE").

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THE OMITTED PORTIONS.

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                  4.1.3.   NON-EXERCISE OF THE OPTION. At the end of an Option
Period for a particular Research Antigen and in exchange for a payment to SGI in
the sum of $[***], EOS may be granted a [***] month extension of the Option
Period for such Research Antigen. If by the end of an Option Period (including
its extension, as above) for any Research Antigen, EOS has not exercised its
Option, all rights related to the use of SGI Technology in connection with the
Antigen shall revert back to SGI.

         4.2.     EXCLUSIVE LICENSE GRANT TO EOS.

                  4.2.1.   GRANT. If (i) EOS elects to exercise its option to
acquire an Exclusive License with respect to a particular Research Antigen
pursuant to Section 4.1.2, and (ii) EOS pays the Option Exercise Fee pursuant to
Section 4.1.2, then subject to the terms and conditions of this Agreement, and
commencing as of the date that SGI has received the Option Exercise Fee from
EOS, SGI is automatically deemed to grant, and in such event hereby grants, to
EOS, on a Research Antigen-by-Research Antigen basis, a worldwide, exclusive
(even as to SGI), non-transferable, royalty-bearing license under the SGI
Technology, with the right to sublicense as permitted in Section 4.2.2, to
discover, have discovered, to develop, have developed, make, have made, import,
have imported, export, have exported, use, sell and have sold Products directed
toward such Research Antigen within the Field in the Territory (an "EXCLUSIVE
LICENSE"), whereupon the Research Antigen shall thereafter be deemed to be an
"EXCLUSIVE ANTIGEN". EOS may obtain an Exclusive License for each Research
Antigen pursuant to this Section 4.2.1 until the expiration of the term of the
Option Period for such Research Antigen. Upon expiration of the term of the last
Option Period hereunder, no further Exclusive Licenses shall be granted under
the terms of this Agreement.

                  The date upon which an Exclusive License is granted with
respect to each Research Antigen under this Section 4.2 is referred to herein as
the "EXCLUSIVE LICENSE DATE" for such Research Antigen.

                  4.2.2.   RIGHTS TO SUBLICENSE.

                           (a)      EOS shall have the right to sublicense the
rights granted to EOS pursuant to this Agreement to any Affiliate or any
Third-Party for any Exclusive Antigen or Product developed by EOS subject to the
terms and conditions of the SGI In-Licenses attached hereto as SCHEDULE E.

                           (b)      EOS [***] all payments due to SGI by reason
of completion of any milestones or Net Sales of any Products by any such
Sublicensee and its compliance with all terms of this Agreement applicable to
EOS (including all terms of this Agreement identified as applicable to
Sublicensee); and any such Sublicensee agrees in writing (i) to keep books and
records and permit SGI to review the information concerning such books and
records that EOS has in its possession in accordance with the terms of this
Agreement and (ii) to comply with all other terms of this Agreement applicable
to EOS (including all terms of this Agreement identified as applicable to a
Sublicensee).

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                           (c)      EOS shall notify SGI of each sublicense
granted to Affiliates or Third-Parties and shall provide SGI with the name and
address of each Sublicensee and a description of the rights granted and the
territory covered by each Sublicensee.

         4.3.     IMPROVEMENTS AND NEW TECHNOLOGIES.

                  4.3.1.   IMPROVEMENTS. In the event that, during the Research
Program Term, SGI conceives, develops or reduces to practice an Improvement that
relates to [***], SGI shall promptly notify EOS of the discovery of such
Improvement. EOS may, at any time during the Research Program Term, [***].

                  4.3.2.   NEW TECHNOLOGIES. Subject to the bona fide rights of
Third-Parties that may exist, SGI hereby grants to EOS the right to [***] as
"SGI TECHNOLOGY," [***] during the Research Program Term ("New Technology"). SGI
shall promptly notify EOS of any New Technology by providing a description of
the New Technology, including all material terms applicable to sublicensees of
the New Technology. Upon such notification, EOS may, by giving written notice to
SGI at any time during the Research Program Term, [***] under this Agreement;
provided that EOS will be obligated [***] as a result of EOS's development and
commercialization of a Product, in addition to any milestones and royalties that
are otherwise payable under this Agreement. For the purposes of clarity, the
Parties acknowledge and agree that EOS shall not be obligated to pay [***].
SCHEDULE B shall be amended from time to time to add the patents and patent
applications covering New Technologies and may be amended from time to time to
add any new patents or patent applications covering New Technologies and
Improvements related thereto and the specific terms of the SGI In-Licenses
covering such New Technologies and Improvements related thereto with which EOS
shall comply.

         4.4.     COMPLIANCE WITH THE SGI IN-LICENSES.

                  4.4.1.   EOS, its Affiliates and Sublicensees agree to comply
with those covenants and conditions of the SGI In-Licenses disclosed to EOS by
SGI in advance and attached hereto in SCHEDULE E, as if they were a party to the
SGI In-Licenses. The Parties agree that [***] are Third-Party beneficiaries
to this Agreement with respect to SGI Technology that includes technology
sublicensed under the [***] and/or the [***].

                  4.4.2.   SGI will not enter into any amendment to an SGI
In-License that imposes additional obligations on EOS, or diminishes EOS's
rights, without the prior written consent of EOS. In the event of any amendment
or termination of any SGI In-License set forth on SCHEDULE E that relates to
technology sublicensed to EOS under such SGI In-License, SGI shall notify EOS no
later than fifteen (15) days before the execution of any proposed amendment to
or termination of an SGI In-License. In the case of an amendment, such
notification will include disclosure of the material terms of the proposed
amendment to an SGI In-License, including all terms

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                                      -12-
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applicable to EOS. If EOS elects to accept an amendment to an SGI In-License,
SCHEDULES B AND E shall be amended to reflect the amended terms of the SGI
In-License. If EOS does not elect to accept an amendment to an SGI In-License,
[***] and if EOS does not [***] then the existing Agreement and all its terms or
conditions shall continue to govern.

                  4.4.3    SGI will use commercially reasonable efforts to
comply with, and exercise its rights under, the SGI In-Licenses so as to ensure
compliance by SGI of its obligations under this Agreement. SGI will not take any
action (or omit to take any action) that would [***] insofar as it would relate
to technology [***].

ARTICLE 5 - TECHNOLOGY DISCLOSURE AND SUPPLY

         5.1.     DISCLOSURE OF DRUG CONJUGATION TECHNOLOGY.

         SGI shall disclose to EOS such Drug Conjugation Technology, SGI
Know-How, New Technologies and Improvements as is necessary to enable EOS to use
the Drug Conjugation Technology, SGI Know-How, New Technologies and Improvements
at its own facilities on the terms and subject to the conditions of this
Agreement. In addition, during the term of this Agreement, SGI shall, upon EOS's
reasonable request and with adequate notice to SGI, make available to EOS at
SGI's facilities, SGI's personnel to provide a reasonable amount of technical
assistance and training to EOS's personnel. If such SGI personnel are engaged in
preparing ADC's when such training occurs, then the fees listed in SCHEDULE D
shall [***] providing such technical assistance. If not, then EOS [***].

         5.2.     IDENTIFICATION OF TECHNOLOGY.

The Parties agree that all Drug Conjugation Technology, SGI Know-How and Drug
Conjugate Materials to be transferred to EOS pursuant to this Agreement
("TRANSFERRED TECHNOLOGY, KNOW-HOW AND MATERIALS") shall be so transferred in
the form of written memoranda marked confidential in the case of such Technology
and Know-How and, in the case of such Materials, by clearly marked containers.
When presented in this manner, these shall be deemed to be "CONFIDENTIAL
INFORMATION" in accordance with Section 10.1. EOS will take reasonable and
appropriate measures to ensure that the confidentiality of all Transferred
Technology, Know-How and Materials is preserved and that the Transferred
Technology, Know-How and Materials are only used for the purposes authorized
under the Agreement and in compliance with this Agreement. Failure by SGI to
transfer such TRANSFERRED TECHNOLOGY, KNOW-HOW AND MATERIALS in the manner
contemplated in this Section 5.2 will not be construed to limit the license
granted to EOS under such SGI Technology pursuant to Sections 2.2 or 4.2 hereof.

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         5.3.     SUPPLY OF DRUG CONJUGATE MATERIALS.

         During the term of the Research Program and any subsequent portion of
the Option Period related to a specific Research Antigen, SGI will provide
reasonable quantities of Drug Conjugate Materials to EOS on [***] terms, not to
exceed [***] % of [***].

         If at any time during the term of this Agreement, SGI [***] for the
Drug Conjugate Materials [***], SGI will [***] Drug Conjugate Materials, [***]
to EOS, for [***].

         SGI will [***] orders for Drug Conjugate Materials and for [***] Drug
Conjugate Materials [***].

         If at any time during the Agreement, SGI [***] SGI will [***] with EOS
[***].

         5.4.     COMMUNICATION AMONG PARTIES.

         Each of EOS and SGI shall appoint a specific individual who shall be
available and shall act as a liaison person to facilitate the day-to-day
communications among the Parties. The names of the initial liaison persons who
shall act on behalf of each of the Parties shall be Richard Murray for EOS and
Peter Senter for SGI. Each of EOS and SGI agrees to notify the other in
accordance with the terms of Section 21.1 of this Agreement in the event of a
change in liaison person.

ARTICLE 6 - DEVELOPMENT AND COMMERCIALIZATION

         EOS shall use its commercially reasonable efforts and diligence in
developing and commercializing Product(s) related to Exclusive Antigen(s) in
accordance with its business, legal, medical and scientific judgment, and in
undertaking investigations and actions required to obtain appropriate Regulatory
Approval(s) necessary to market such Products that EOS determines in its sole
discretion to pursue in the Territory, such reasonable efforts and diligence to
be in accordance with the efforts and resources EOS would use for product(s)
owned by it or to which it has rights, which is of similar market potential at a
similar stage in development as the Products directed towards the applicable
Exclusive Antigen taking into account the competitiveness of the marketplace,
the proprietary position of the Product(s) that EOS determines in its sole
discretion to pursue, the relative potential safety and efficacy of such
Product(s), the regulatory requirements involved in such Products' development,
commercialization and Regulatory Approval, the Cost of Goods and availability of
capacity to

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THE OMITTED PORTIONS.

                                      -14-
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manufacture and supply such Product(s) at commercial scale, the profitability of
such Product(s), and other relevant factors including technical, legal,
scientific or medical factors.

         As to between the Parties, EOS shall be solely responsible for funding
all costs of the development and commercialization of each Product EOS
determines in its sole discretion to pursue. EOS shall keep SGI informed in a
timely manner as to the progress of the development of Products EOS determines,
from time to time, to pursue. Beginning on January 1, 2002 and thereafter within
thirty (30) days following the end of each calendar year, EOS shall provide SGI
with a written report summarizing EOS's activities related to research and
development of Products and status of clinical trials and government approvals
necessary for marketing Products. Beginning on January 1, 2002 and thereafter
within thirty (30) days following the end of each calendar year, SGI shall
provide EOS with a written report summarizing SGI's activities related to
preparing ADCs and developing new Drug Conjugation Technology.

ARTICLE 7 - MAINTENANCE FEES, ROYALTIES AND MILESTONES.

         7.1.     MAINTENANCE FEES

                  7.1.1.   EOS shall pay to SGI an annual maintenance fee in the
amount of [***] Dollars ($[***]) for each Exclusive Antigen, beginning on the
[***] anniversary of the Exclusive License Date for each Exclusive Antigen. This
annual maintenance fee[***]. SGI shall [***] payable on the anniversary of the
Exclusive License Date following each of the following milestone events
applicable to such Exclusive Antigen: (a) [***] for a Product related to such
Exclusive Antigen, (b) [***] for a Product related to such Exclusive Antigen
provided that it occurs within [***] years of the [***] for such Product, (c)
the [***] for a Product related to such Exclusive Antigen, and (d) the [***] of
the [***] for a Product related to such Exclusive Antigen. Notwithstanding the
foregoing, in no event shall EOS be required to pay SGI [***]: (y) [***] Dollars
($[***]) if EOS [***] and (z) [***] Dollars ($[***]) if EOS [***].

                  7.1.2.   EOS may terminate the Exclusive License for any
Exclusive Antigen for any reason and at any time upon [***] days' prior notice
to SGI, in which event no maintenance fees shall accrue to SGI under Section
7.1.1 for such Research Antigen following the termination date; provided that
[***]. The Exclusive License for such Exclusive Antigen shall terminate
effective as of such termination date. All rights related to the use of SGI
Technology in connection with the Exclusive Antigen shall revert back to SGI
after a waiting period of [***] after such termination date.

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THE OMITTED PORTIONS.

                                      -15-
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                  7.1.3. Notwithstanding anything to the contrary in this
Section 7.1, EOS may reinstate the Exclusive License for such former Exclusive
Antigen within [***] following the termination date by notifying SGI and making
an additional payment in the sum of $[***] to SGI.

         7.2.     ROYALTIES PAYABLE BY EOS.

         In consideration for the Exclusive Licenses granted to EOS herein,
during the Royalty Term, EOS shall pay to SGI royalties on Net Sales of
Products. Such royalties shall be established at the following rates, determined
on a Product-by-Product basis:

                  (a)      [***]% of the first [***] Dollars ($[***]) in
aggregate Net Sales of the Product in each calendar year;

                  (b)      [***]% of incremental aggregate Net Sales of the
Product up to [***] Dollars ($[***]) in each calendar year; and

                  (c)      [***]% of incremental aggregate Net Sales of the
Product in excess of [***] Dollars ($[***]) in each calendar year.

         7.3.     THIRD-PARTY ROYALTIES.

                  7.3.1.   EOS shall pay any Third-Party royalties owed on
account of its sales of Product in the Licensed Territory, including royalties
owed due to use of the SGI Technology; PROVIDED, HOWEVER, [***] in accordance
with Section 7.3.2 where applicable. All current Third-Party royalties known to
SGI are set forth on SCHEDULE B and the terms of such royalties have been
disclosed to EOS and are set forth in SCHEDULE E.

                  7.3.2.   [***], then the royalty rates payable to SGI under
Section 7.2 shall be [***]; PROVIDED, HOWEVER, that in no event shall [***] the
following rates, determined on a [***]:

                  (a)      [***] of [***] in aggregate Net Sales of the
Product[***];

                  (b)      [***] of [***] aggregate Net Sales of the Product
[***]; and

                  (c)      [***].

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         7.4.     NON-ROYALTY SALES.

         No royalty shall be payable under this Article 7 with respect to sales
of Products among EOS and its Affiliates or its Sublicensees or among
Sublicensees and their Affiliates, but a royalty shall be due upon the
subsequent sale of the Product to a Third-Party.

         7.5.     MILESTONE PAYMENTS.

         As additional consideration for the licenses, rights and privileges
granted to it hereunder, EOS shall pay to SGI the following milestone payments
to SGI within thirty (30) days of the first occurrence of each event set forth
below with respect to Products, whether such events are achieved by EOS, its
Affiliates or Sublicensees:

                  (a)      Upon [***] for each Product, [***] Dollars ($[***]);

                  (b)      Upon [***] for each Product, [***] Dollars ($[***]);

                  (c)      Upon [***] for each Product, [***] Dollars ($[***]);

                  (d)      Upon [***] for each Product in either the [***]
(each, a "MAJOR MARKET"), [***] Dollars ($[***]);

                  (e)      Upon [***] for each Licensed Product in a second
Major Market, [***] Dollars ($[***]); and

                  (f)      Upon [***], said indication to be the result of an
[***] for each Product in a Major Market, [***] Dollars ($[***]).

         EOS will only be required to pay each of the above milestones (other
than the milestone set forth in Section 7.5(f)) to SGI for the [***] Product for
each Exclusive Antigen to complete the milestone event. EOS will only be
required to pay the milestone set forth in Section 7.5(f) to SGI for the [***]
Product for each Exclusive Antigen that completes such milestone event.

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THE OMITTED PORTIONS.

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ARTICLE 8 - ROYALTY REPORTS AND ACCOUNTING

         8.1.     REPORTS, EXCHANGE RATES.

                  8.1.1.   During the term of this Agreement following the First
Commercial Sale and during the Royalty Term, EOS shall furnish to SGI, with
respect to each Calendar Quarter, a written report showing on a consolidated
basis in reasonably specific detail and on a country-by-country basis, (a) the
gross sales of Products sold by EOS, its Affiliates and its Sublicensees in the
Territory during the corresponding Calendar Quarter and the calculation of Net
Sales from such gross sales; (b) the royalties payable in US dollars, if any,
which shall have accrued hereunder based upon Net Sales of Products; (c) the
withholding taxes, if any, required by law to be deducted in respect of such
royalties; (d) the dates of the First Commercial Sale of each Product in each
country in the Territory if it has occurred during the corresponding Calendar
Quarter; and (e) the exchange rates (as determined pursuant to Section 8.1.4
herein) used in determining the royalty amount expressed in US dollars
(collectively, "REPORTS").

                  8.1.2.   EOS shall include in each permitted sublicense
granted by it pursuant to this Agreement a provision requiring its Sublicensees
to make Reports to EOS within [***] ([***]) days of the close of each Calendar
Quarter, to keep and maintain records of sales made pursuant to such sublicense
and to grant access to such Reports by SGI's independent accountant to the same
extent required with respect to EOS's Reports under this Agreement.

                  8.1.3.   Reports shall be due on the [***] ([***]) day
following the close of each Calendar Quarter. EOS shall keep complete and
accurate records in sufficient detail to properly reflect all gross sales and
Net Sales and to enable the royalties payable hereunder to be determined.

                  8.1.4.   With respect to sales (if any) of Products invoiced
in US dollars, the gross sales, Net Sales, and royalties payable shall be
expressed in US dollars. With respect to sales of Products invoiced in a
currency other than US dollars, the gross sales, Net Sales and royalties payable
shall be expressed in the currency of the invoice issued by the Party making the
sale together with the US dollars equivalent of the royalty payable, calculated
using the following rates: (i) if the Product incorporates technology [***] then
the rate published in the Wall Street Journal for the last banking day of the
applicable Calendar Quarter, or (ii) if the Product does not include technology
[***,] then the average of the daily rates for such currency quoted by Citibank,
N.A. for each of the last fifteen (15) banking days of the applicable Calendar
Quarter.

         8.2.     AUDITS.

                  8.2.1.   Upon the written request of SGI and not more than
once in each calendar year, EOS shall permit an independent certified public
accounting firm of internationally recognized standing, selected by SGI and
reasonably acceptable to EOS, at SGI's expense, to have access during normal
business hours to such of the records of EOS and its Affiliates as may

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THE OMITTED PORTIONS.

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be reasonably necessary to verify the accuracy of the Reports hereunder for any
year ending not more than [***] ([***]) months prior to the date of such
request. The accounting firm shall disclose to SGI only whether the records are
correct or not and the specific details concerning any discrepancies. No other
information shall be shared.

                  8.2.2.   If such accounting firm concludes that additional
royalties were owed during such period, EOS shall pay the additional royalties
within thirty (30) days of the date SGI delivers to EOS such accounting firm's
written report so concluding. The fees charged by such accounting firm shall be
paid by SGI; PROVIDED, HOWEVER, if the audit discloses that the royalties
payable by EOS for the audited period are more than [***] percent ([***]%) of
the royalties actually paid for such period, then EOS shall pay the reasonable
fees and expenses charged by such accounting firm.

                  8.2.3.   Upon the expiration of [***] ([***]) months following
the end of any calendar year, the calculation of royalties payable with respect
to such year shall be binding and conclusive upon SGI, and EOS, its Affiliates
and Sublicensees shall be released from any liability or accountability with
respect to royalties for such year.

         8.3.     CONFIDENTIAL FINANCIAL INFORMATION.

         SGI shall treat all financial information subject to review under this
Article 8 or under any sublicense agreement as Confidential Information of EOS,
and shall cause its accounting firm to retain all such financial information in
confidence.

ARTICLE 9 - PAYMENTS.  LATE PAYMENTS

         9.1.     PAYMENT TERMS.

         Royalties shown to have accrued by each Report provided for under
Article 8 of this Agreement shall be due on the date such Report is due. Payment
of royalties in whole or in part may be made in advance of such due date. Past
due payments shall accrue interest at a rate of [***] percent ([***]%) per
annum, or the maximum applicable rate permitted by law, unless occurring as a
result of an event the Parties agree constitutes an Event of Force Majeure or as
a result of a good faith dispute between the Parties regarding performance or
breach of their obligations hereunder.

         9.2.     PAYMENT METHOD.

         All payments by EOS to SGI under this Agreement shall be paid in US
dollars, and all such payments shall be made by bank wire transfer in
immediately available funds to the bank account designated by SGI in writing.

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THE OMITTED PORTIONS.

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         9.3.     EXCHANGE CONTROL.

         If at any time legal restrictions prevent the prompt remittance of part
or all royalties with respect to any country in the Territory where Product is
sold, payment shall be made through such lawful means or method as the Parties
reasonably shall determine.

         9.4.     WITHHOLDING TAXES.

         Except as otherwise provided below, all amounts owing from EOS to SGI
under this Agreement are gross amounts. EOS shall be entitled to deduct the
amount of any withholding taxes payable or required to be withheld by EOS, its
Affiliates or Sublicensees, to the extent EOS, its Affiliates or Sublicensees
pay to the appropriate governmental authority on behalf of SGI such taxes. EOS
shall use commercially reasonable efforts to minimize any such taxes, levies or
charges required to be withheld on behalf of SGI by EOS, its Affiliates or
Sublicensees. EOS promptly shall deliver to SGI proof of payment of all such
taxes, levies and other charges, together with copies of all communications from
or with such governmental authority with respect thereto.

ARTICLE 10 - CONFIDENTIALITY

         10.1.    NON-DISCLOSURE OBLIGATIONS.

         Except as otherwise provided in this Article 10, during the Term and
for a period of [***] ([***]) years thereafter, each Party shall maintain in
confidence, and use only for purposes as expressly authorized and contemplated
by this Agreement, all confidential or proprietary information, data, documents
or other materials supplied by the other Party under this Agreement and marked
or otherwise identified as "CONFIDENTIAL," including SGI Know-How, Drug
Conjugation Technology, Improvements and New Technologies. For purposes of this
Agreement, information and data described above shall be hereinafter referred to
as "CONFIDENTIAL INFORMATION." Each Party shall use at least the same standard
of care as it uses to protect its own Confidential Information to ensure that
its and its Affiliates' employees, agents, consultants and clinical
investigators only make use of Confidential Information for purposes as
expressly authorized and contemplated by this Agreement and do not disclose or
make any unauthorized use of such Confidential Information.

         10.2.    PERMITTED DISCLOSURES.

         Notwithstanding the foregoing, the provisions of Section 10.1 hereof
shall not apply to information, documents or materials that the disclosing Party
can conclusively establish:

                  (a)      have become published or otherwise entered the public
domain other than by acts of the disclosing Party or its Affiliates in
contravention of this Agreement;

                  (b)      are permitted to be disclosed by prior consent of the
other Party;

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THE OMITTED PORTIONS.

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                  (c)      have become known to the disclosing Party by a
Third-Party, provided such Confidential Information was not obtained by such
Third-Party directly or indirectly from the other Party under this Agreement on
a confidential basis;

                  (d)      prior to disclosure under the Agreement, was already
in the possession of the disclosing Party, its Affiliates or Sublicensees,
provided such Confidential Information was not obtained directly or indirectly
from the other Party under this Agreement;

                  (e)      is disclosed in a press release agreed to by both
Parties hereto, which agreement shall not be unreasonably withheld; and

                  (f)      are required to be disclosed by the disclosing Party
to comply with any applicable law, regulation or court order, or are reasonably
necessary to obtain patents, copyrights or authorizations to conduct clinical
trials with, and to commercially market Product(s), provided that the disclosing
Party shall provide prior notice of such disclosure to the other Party and take
reasonable and lawful actions to avoid or minimize the degree of disclosure.

         10.3.    TERMS OF THE AGREEMENT.

         EOS and SGI shall not disclose any terms or conditions of this
Agreement to any Third-Party without the prior consent of the other Party,
except as required by applicable laws, regulations or a court order (and in any
such case the disclosing Party shall provide notice to the other Party and takes
reasonable and lawful actions to avoid or minimize the degree of such
disclosures).

         10.4.    PRESS RELEASES AND OTHER DISCLOSURES TO THIRD-PARTIES.

         Neither SGI nor EOS will, without the prior consent of the other, issue
any press release or make any other public announcement or furnish any statement
to any Person (other than either Parties' respective Affiliates) concerning the
existence of this Agreement, its terms and the transactions contemplated
thereby, except for (i) general statement referring to the existence of this
Agreement, and identity of the Parties but no other details, (ii) disclosures
made in compliance with Sections 10.2 and 10.3 hereof, (iii) attorneys,
consultants, and accountants retained to represent them in connection with the
transactions contemplated hereby and (iv) occasional, brief comments by the
respective officers of EOS and SGI consistent with such guidelines for public
statements as may be mutually agreed by EOS and SGI made in connection with
routine interviews with analysts or members of the financial press.

         10.5.    PUBLICATIONS REGARDING RESULTS OF THE RESEARCH PROGRAM.

         No Party may publish, present or announce results of the Research
Program either orally or in writing (the "PUBLICATION") without obtaining the
written consent of the other Party. The other Party shall have thirty (30) days
from receipt of the proposed Publication to provide comments and/or proposed
changes to the disclosing Party. The disclosing Party shall take into account
the comments and/or proposed changes made by the other Party on any Publication
and

                                      -21-
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shall agree to have employees or others acting on behalf of the other Party be
mentioned as co-authors on any Publication describing results to which such
persons have contributed. If the other Party reasonably determines the
Publication would amount to the public disclosure of such Party's Confidential
Information and/or of a patentable invention upon which a patent application
should be filed prior to any such disclosure, submission of the concerned
Publication to Third-Parties shall be delayed for a sixty (60) day period from
the date of said notice, or for such longer period which may appear necessary
for appropriately deleting Confidential Information from the proposed
Publication and/or drafting and filing a patent application covering such
invention.

ARTICLE 11 - INVENTIONS AND PATENTS

         11.1.    OWNERSHIP OF INVENTIONS.

                  11.1.1.  INVENTORSHIP. Subject to the terms of this Article
11, inventorship of any inventions arising out of the Research Program or under
this Agreement shall be determined according to U.S. law. Any inventions or
other intellectual property invented solely by one Party shall be owned by that
Party.

                  11.1.2.  OWNERSHIP OF SGI TECHNOLOGY AND JOINTLY-INVENTED
INVENTIONS RELATED THERETO.

         All right, title and interest to the SGI Technology shall (subject to
any licenses explicitly granted hereunder) at all times remain with and be
vested in SGI. Any invention or other intellectual property made, and data
derived, by jointly EOS or its respective employees, consultants or agents and
SGI or its respective employees, consultants or agents that relate to the SGI
Technology shall be owned by [***]. EOS shall promptly notify SGI of any such
invention or other intellectual property, and cooperate with SGI at SGI's
request and expense, in the preparation, filing, prosecution, and defense of
patent applications and patents relating thereto. Subject to the terms of this
Article 11, [***] that relate to the SGI Technology, and shall in a reasonably
timely manner execute those documents, as requested by SGI, necessary to
document and/or perfect the assignment of such inventions and intellectual
property.

                  11.1.3.  OWNERSHIP OF ANTIBODIES, RESEARCH ANTIGENS, EXCLUSIVE
ANTIGENS,AND JOINTLY-INVENTED INVENTIONS RELATED THERETO. Subject to Section
11.1.2, all right, title and interest to the Antibodies, Research Antigens and
Exclusive Antigens shall at all times remain with and be vested in EOS. Any
invention or other intellectual property made, and data derived, by jointly SGI
or its respective employees, consultants or agents and EOS or its respective
employees, consultants or agents that relate to the Antibodies, the Research
Antigens, the Exclusive Antigens or any Antibody included in the ADC, shall be
owned by [***]. SGI shall promptly notify EOS of any such invention or other
intellectual property, and cooperate with EOS at EOS's request and expense, in
the preparation, filing, prosecution, and defense of patent applications and
patents relating thereto. Subject to the terms of this Article 11, [***] that

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THE OMITTED PORTIONS.

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relate to the above noted technology as well as any invention or other
intellectual property made, and data derived as it directly relates, and only
insofar as it directly relates, to an ADC licensed under this Agreement
regardless of inventorship, and shall in a reasonably timely manner execute
those documents, as requested by EOS, necessary to document and/or perfect the
assignment of such inventions and intellectual property.

         11.2.    PATENT PROSECUTION AND MAINTENANCE.

                  11.2.1.  SGI shall be responsible for and shall control the
preparation, filing, prosecution, grant and maintenance of all Licensed Patents.
SGI shall, at its sole expense, prepare, file, prosecute and maintain such
Licensed Patents in good faith consistent with its customary patent policy and
its reasonable business judgment, and shall consider in good faith the interests
of EOS in so doing.

                  11.2.2.  Subject to Section 11.2.1, EOS shall be responsible
for and shall control the preparation, filing, prosecution, grant and
maintenance, of any patents and patent applications having as subject matter an
ADC, Antibody, Research Antigen or Exclusive Antigen Invention (the "EOS
PATENTS"). EOS shall have the right, but not the obligation, at its sole
discretion and expense, prepare, file, prosecute and maintain such patent rights
in good faith consistent with its customary patent policy and its reasonable
business judgment.

                  11.2.3.  The Parties shall at all times fully cooperate in
order to reasonably implement the foregoing provisions.

         11.3.    ENFORCEMENT OF LICENSED PATENTS.

                  11.3.1.  SGI shall have the obligation in Major Markets and
the right in all other markets, at its sole expense, to determine the
appropriate course of action to enforce the Licensed Patents or otherwise abate
the infringement thereof, to take (or refrain from taking) appropriate action to
enforce the Licensed Patents, to control any litigation or other enforcement
action and to enter into, or permit, the settlement of any such litigation or
other enforcement action with respect to the Licensed Patents, and in good faith
shall consider the interests of EOS in so doing; provided that nothing herein
shall be construed to obligate SGI to take any action that would be commercially
unreasonable or would subject SGI to undue business risk. All monies recovered
upon the final judgment or settlement of any such suit to enforce any Licensed
Patents shall be retained by SGI. EOS and SGI shall fully cooperate with each
other in any action to enforce the Licensed Patents. If SGI fails to take any
action to enforce the Licensed Patents or control any litigation with respect to
the licensed Patents within a period of ninety (90) days after reasonable notice
of the infringement of the Licensed Patents, then EOS shall have the right to
bring and control any such action by counsel of its own choice, and in such
case, all monies recovered upon the final judgment or settlement of any such
suit to enforce any Licensed Patents shall be retained by EOS. In such a case,
SGI shall cooperate fully with EOS, at EOS's expense, in its efforts to enforce
the Licensed Patents, including being joined as a party to such action if
necessary.

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                  11.3.2.  EOS shall have the right, at its sole expense, to
determine the appropriate course of action to enforce the EOS Patents or
otherwise abate the infringement thereof, to take (or refrain from taking)
appropriate action to enforce the EOS Patents, to control any litigation or
other enforcement action and to enter into, or permit, the settlement of any
such litigation or other enforcement action with respect to the EOS Patents. All
monies recovered upon the final judgment or settlement of any such suit to
enforce any EOS Patents shall be retained by EOS. SGI and EOS shall fully
cooperate with each other in any action to enforce the EOS Patents.

         11.4.    PRIOR PATENT RIGHTS. Notwithstanding anything to the contrary
in this Agreement, with respect to any Licensed Patents that are subject to the
SGI In-Licenses, the rights and obligations of the Parties under Section 11.2
and 11.3 shall be subject to SGI's licensees' rights to participate in and
control prosecution, maintenance and enforcement of such Licensed Patents in
accordance with the terms and conditions of the applicable SGI In-License.

ARTICLE 12 - INFRINGEMENT ACTIONS BY THIRD-PARTIES

         If EOS, SGI or their respective Affiliates, or EOS's Sublicensees,
is sued by a Third-Party for infringement of a Third-Party's patent because
of the use of the Drug Conjugation Technology, the Party which has been sued
shall promptly notify the other Party no event later than thirty (30) days of
the institution of such suit. The notice shall set forth the facts of such
infringement and provide evidence of such infringement that is within the
notifying Party's control. SGI shall have the right, in its sole discretion,
to control the defense of such suit at its own expense, in which event EOS
shall have the right to be represented by advisory counsel of its own
selection, at its own expense, and shall cooperate fully in the defense of
such suit and furnish to SGI all evidence and assistance in its control. If
SGI does not elect within thirty (30) days after receipt of such notice to so
control the defense of such suit, EOS may undertake such control at its own
expense, and SGI shall then have the right to be represented by advisory
counsel of its own selection and at its own expense, and SGI shall cooperate
fully in the defense of such suit and furnish to EOS all evidence and
assistance in SGI's control. The Party controlling the suit shall keep the
other Party reasonably informed of the status of the suit under this Article
12. In no event may the Party controlling the suit settle or otherwise
consent to an adverse judgment in such suit that diminishes the rights or
interests of the non-controlling Party without the express written consent of
the non-controlling Party. Any judgments, awards, settlements or damages
payable with respect to legal proceedings covered by this Article 12 shall be
paid by or to the Party which controls the litigation; PROVIDED, HOWEVER,
that if the other Party has elected to be represented by advisory counsel,
the other Party shall receive the actual reasonable cost of its legal fees
for such advisory counsel.

ARTICLE 13 - REGULATORY ASSISTANCE

         Should EOS develop an ADC for clinical development, SGI will provide to
a reasonable extent, at EOS's request, technical information required for EOS to
file for and obtain permission to commence human clinical trials. This
information will include, as available, Chemistry Manufacturing and Controls
documentation, other toxicity and safety data, access to any drug master files
on record with the FDA and any other relevant materials. EOS shall reimburse SGI

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for any out-of-pocket costs incurred by SGI in providing such information plus
an amount equal to SGI's fully burdened FTE rate, which rate shall not exceed
$[***] per year.

ARTICLE 14 - REPRESENTATIONS AND WARRANTIES

         14.1.    REPRESENTATIONS AND WARRANTIES.

                  (a)      This Agreement has been duly executed and delivered
by each Party and constitutes the valid and binding obligation of each Party,
enforceable against such Party in accordance with its terms, except as
enforceability may be limited by bankruptcy, fraudulent conveyance, insolvency,
reorganization, moratorium or other laws relating to or affecting creditors'
rights generally and by general equitable principals. The execution, delivery
and performance of this Agreement has been duly authorized by all necessary
action on the part of each Party, its officers and directors.

                  (b)      The execution, delivery and performance of the
Agreement by each Party does not conflict with any agreement, instrument or
understanding, oral or written, to which it is a party or by which it is bound,
nor violate any law or regulation of any court, governmental body or
administrative or other agency having jurisdiction over it.

                  (c)      SGI has not, and during the term of the Agreement
will not, grant any right to any Third-Party relating to the Licensed Patents
and SGI Know-how which would conflict with the rights granted to EOS hereunder.

                  (d)      SGI represents and warrants that it has the right to
grant the licenses granted herein and that it has no knowledge of any rights of
any Third-Parties that would interfere with the practice of the Licensed Patents
or other SGI Technology.

                  (e)      SGI represents and warrants that all Drug Conjugate
Materials manufactured under SGI's authority will be in conformity with the
agreed upon specifications upon delivery to EOS.

         14.2.    PERFORMANCE BY AFFILIATES.

         The Parties recognize that each may perform some or all of its
obligations under this Agreement through Affiliates, PROVIDED, HOWEVER, that
each Party shall remain responsible and be guarantor of the performance by its
Affiliates and shall cause its Affiliates to comply with the provisions of this
Agreement in connection with such performance.

ARTICLE 15 - TERM AND TERMINATION

         15.1.    TERM

         Unless earlier terminated pursuant to this Article 15, the term of this
Agreement shall commence on the Effective Date and shall remain in full force
and effect until the earlier of (i)

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the expiration of the last to expire Option Period unless EOS exercises
at least [***] ([***]) Option prior to such date; or (ii) the expiration of the
last to expire Royalty Term.

         15.2.    TERMINATION BY EOS.

         EOS shall have the right, at any time in its sole discretion, to
terminate this Agreement as a whole, either forthwith upon written notice to SGI
if such notice is sent before the end of the Research Program Term, or by
providing not less than three (3) months prior notice to SGI of such
termination; PROVIDED, HOWEVER if EOS elects to terminate this Agreement as a
result of an amendment to an SGI In-License as set forth in Section 7.3.1, EOS
shall have to provide only thirty (30) days prior notice to SGI of such
termination.

         15.3.    DISCONTINUANCE OF DEVELOPMENT EFFORTS BY EOS.

         EOS shall promptly give SGI notice if EOS intends to abandon
permanently the commercial development of any Exclusive Antigen whereupon any
Exclusive License with respect to such Exclusive Antigen shall automatically
terminate and all rights related to the use of SGI Technology in connection with
the Exclusive Antigen shall revert back to SGI.

         15.4.    TERMINATION FOR CAUSE.

         Either Party may terminate this Agreement for material breach by the
other Party (the "BREACHING PARTY") of any material provision of the Agreement,
if the Breaching Party has not cured such breach within ninety (90) days after
notice thereof; PROVIDED, HOWEVER, that neither Party shall be deemed to be in
material breach of this Agreement for purposes of a termination hereunder during
any period in which a good faith dispute between the Parties exists regarding
performance of breach of its obligations hereunder, and provided further,
however, that in the event EOS fails to timely pay SGI the annual maintenance
fees, royalty payments and milestone payments set forth in Article 7, the
Research Program Fee(s) set forth in Section 3.4 or the Option Exercise Fee(s)
set forth in Section 4.1.2, EOS shall have only thirty (30) days to cure such
material breach.

         15.5.    TERMINATION UPON INSOLVENCY.

         Either Party may terminate this Agreement if, at any time, the other
Party shall file in any court or agency pursuant to any statute or regulation of
any state, country or jurisdiction, a petition in bankruptcy or insolvency or
for reorganization or for an arrangement or for the appointment of a receiver or
trustee of that Party or of its assets, or if such other Party proposes a
written agreement of composition or extension of its debts, or if such other
Party shall be served with an involuntary petition against it, filed in any
insolvency proceeding, and such petition shall not be dismissed within sixty
(60) days after the filing thereof, or if such other Party shall propose or be a
party to any dissolution or liquidation, or if such other Party shall make an
assignment for the benefit of its creditors.

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THE OMITTED PORTIONS.

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         15.6.    TERMINATION OF SGI IN-LICENSES. All rights and obligations
under an SGI In-License sublicensed under this Agreement shall terminate upon
thirty (30) days prior written notice by SGI if EOS breaches any material
provision of such SGI In-License Agreement and fails to cure such breach within
such sixty (60) day period; provided, however such cure period may be extended
by consent of the Parties. All rights and obligations under the [***] shall
automatically terminate if EOS fails to maintain the insurance required under
the [***]. All rights and obligations under an SGI In-License sublicensed under
this Agreement shall terminate upon termination of such SGI In-License; subject
to EOS's right, if any, under such SGI In-License to enter into a direct license
with licensor upon the terms and conditions set forth in such SGI In-License.

         15.7.    EFFECT OF EXPIRATION AND TERMINATION.

                  15.7.1.  Except where explicitly provided within this
Agreement, termination of this Agreement for any reason, or expiration of this
Agreement, with not affect any: (i) obligations, including payment of any
royalties or other sums which have accrued as of the date of termination or
expiration, and (ii) rights and obligations which, from the context thereof, are
intended to survive termination or expiration of this Agreement, including
provisions of Articles 10, 11, 12, 16 and 22, and Sections 8.2, 8.3 and 15.7,
which shall survive the expiration or termination of the Agreement.
Notwithstanding the foregoing, all licenses granted by SGI to EOS hereunder,
including all Exclusive Licenses, will immediately terminate upon termination of
this Agreement pursuant to Section 15.2 or Section 15.4 or Section 15.5.

                  15.7.2.  Upon the expiration of the Royalty Term for each
Exclusive Antigen pursuant to Section 15.1, SGI shall grant EOS a royalty-free,
perpetual, worldwide, license to use the SGI Technology for that Exclusive
Antigen.

ARTICLE 16 - INDEMNITY.

         16.1.    DIRECT INDEMNITY.

                  16.1.1.  Each Party shall indemnify and hold harmless, and
hereby forever releases and discharges the other Party from and against all
claims, demands, liabilities, damages and expenses, including attorneys' fees
and costs (collectively, the "LIABILITIES") arising out of (i) the breach of any
material provision of this Agreement by the indemnifying Party (or the
inaccuracy of any representation or warranty made by such Party in this
Agreement), except to the extent such Liabilities resulted from the gross
negligence, recklessness or willful misconduct of the other Party; or (ii) the
gross negligence, recklessness or willful misconduct of the indemnifying Party.

                  16.1.2.  EOS shall indemnify and hold harmless, and hereby
forever releases and discharges SGI from and against all Liabilities suffered or
incurred arising out of any Third-Party claims for personal injury, death or
disability or any product recall to the extent caused by (a) any failure to test
for or provide adequate warnings of adverse side effects to the extent such
failure arises out of acts or omissions in connection with the preclinical or
clinical testing of any

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Product, (b) any manufacturing defect in any Product or (c) any other act or
omission of EOS in connection with its obligations under this Agreement; except
in each case to the extent such Liabilities resulted from the gross negligence,
recklessness or willful misconduct by SGI or the inaccuracy of any
representation or warranty made by SGI in this Agreement.

                  16.1.3.  SGI shall indemnify and hold harmless, and hereby
forever releases and discharges EOS from and against all Liabilities suffered or
incurred arising out of any Third-Party claims for personal injury, death or
disability or any product recall to the extent caused by (a) any SGI Technology
incorporated in a product other than an EOS Product, (b) any manufacturing
defect in any SGI Technology, or (c) any other act or omission of SGI in
connection with its obligations under this Agreement; except in each case to the
extent such Liabilities resulted from the gross negligence, recklessness or
willful misconduct by EOS or the inaccuracy of any representation or warranty
made by EOS in this Agreement.

         16.2.    PROCEDURE.

         A Party (the "INDEMNITEE") that intends to claim indemnification under
this Article 16 shall promptly provide notice to the other Party (the
"INDEMNITOR") of any Liability or action in respect of which the Indemnitee
intends to claim such indemnification, which notice shall include a reasonable
identification of the alleged facts giving rise to such Liability, and the
Indemnitor shall have the right to participate in, and, to the extent the
Indemnitor so desires, jointly with any other Indemnitor similarly noticed, to
assume the defense thereof with counsel selected by the Indemnitor; PROVIDED,
HOWEVER, that the Indemnitee shall have the right to retain its own counsel,
with the fees and expenses to be paid by the Indemnitor, if representation of
such Indemnitee by the counsel retained by the Indemnitor would be inappropriate
due to actual or potential differing interests between such Indemnitee and any
other Party represented by such counsel in such proceedings. Any settlement of a
Liability for which any Indemnitee seeks to be reimbursed, indemnified, defended
or held harmless under this Article 16 shall be subject to prior consent of such
Indemnitee, such consent shall be withheld unreasonably.

ARTICLE 17- FORCE MAJEURE

         No Party (or any of its Affiliates) shall be held liable or responsible
to the other Party (or any of its Affiliates) nor be deemed to have defaulted
under or breached the Agreement for failure or delay in fulfilling or performing
any term of the Agreement when such failure or delay is caused by or results
from causes beyond the reasonable control of the affected Party (or any of its
Affiliates) including fire, floods, embargoes, war, acts of war (whether war be
declared or not), insurrections, riots, civil commotions, acts of God or acts,
or omissions or delays in acting by any governmental authority (collectively,
"EVENTS OF FORCE MAJEURE"); PROVIDED, HOWEVER, that the affected Party shall
exert all reasonable efforts to eliminate, cure or overcome any such Event of
Force Majeure and to resume performance of its covenants with all possible
speed. Notwithstanding the foregoing, to the extent that an Event of Force
Majeure continues for a period in excess of six (6) months, the affected Party
shall promptly notify in writing the other Party of such Event of Force Majeure
and within four (4) months of the other Party's receipt of such notice, the
Parties agree to negotiate in good faith either (i) to resolve the Event of
Force Majeure, if possible, (ii) to extend by mutual agreement the time period
to resolve, eliminate,

                                      -28-
<Page>

cure or overcome such Event of Force Majeure, (iii) to amend this Agreement to
the extent reasonably possible, or (iv) to terminate this Agreement.

ARTICLE 18 - ASSIGNMENT

         This Agreement may not be assigned or otherwise transferred, nor,
except as expressly provided hereunder, may any right or obligations hereunder
be assigned or transferred to any Third-Party by either Party without the
consent of the other Party, such consent not to be unreasonably withheld;
PROVIDED, HOWEVER, that either Party may, without such consent but with
notification, assign this Agreement and its rights and obligations hereunder to
any of its Affiliates or in connection with the transfer or sale of all or
substantially all of its business, or in the event of its merger or
consolidation (such merger or consolidation shall be hereinafter referred to as
a "CHANGE IN CONTROL"). Any permitted assignee shall assume all rights and
obligations of its assignor under this Agreement; provided, however, that an
acquiror of SGI in connection with a Change of Control shall not be obligated,
but shall have the right, to disclose or offer to EOS pursuant to Section 4.3
any Improvements or New Technologies owned or controlled by such acquiror prior
to the Change of Control, or any Improvements or New Technologies owned or
controlled by acquiror or SGI after a Change of Control; provided, however, to
the extent that SGI continues to exist as a separate entity, Improvements
derived from the SGI Technology will continue to be subject to the terms and
conditions of this Agreement.

ARTICLE 19 - SEVERABILITY

         Each Party hereby agrees that it does not intend to violate any public
policy, statutory or common laws, rules, regulations, treaty or decision of any
government agency or executive body thereof of any country or community or
association of countries. Should one or more provisions of this Agreement be or
become invalid, the Parties hereto shall substitute, by mutual consent, valid
provisions for such invalid provisions which valid provisions in their economic
effect are sufficiently similar to the invalid provisions that it can be
reasonably assumed that the Parties would have entered into this Agreement with
such provisions.

In case such provisions cannot be agreed upon, the invalidity of one or several
provisions of this Agreement shall not affect the validity of this Agreement as
a whole, unless the invalid provisions are of such essential importance to this
Agreement that it is to be reasonably assumed that the Parties would not have
entered into this Agreement without the invalid provisions.

ARTICLE 20 - INSURANCE

         During the term of this Agreement and thereafter for the period of time
required below, each Party shall maintain [***] insurance in the minimum amount
of [***] and [***]; and commencing not later than [***] of the [***] and
thereafter for the period of time required below, EOS shall obtain and maintain
on an ongoing basis [***] in the amount of at least [***] and [***]

----------
[***] CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.

                                      -29-
<Page>

[***] provided that [***]. All of such insurance coverage shall be
maintained with an insurance company or companies having an A.M. Best rating of
"A-" or better and an aggregate deductible not to exceed [***].

         Not later than the effective date of this Agreement with respect to the
[***], and not later than [***], EOS shall provide to SGI a certificate(s)
evidencing all such required coverage hereunder. Thereafter EOS shall maintain
such insurance coverage without interruption during the term of this Agreement
and for a period of at least [***] and shall provide certificates evidencing
such insurance coverage without interruption on an annual basis (by no later
than the annual renewal date for such coverage) during the period of time for
which such coverage must be maintained.

         EOS's insurance shall [***] on [***] insurance required hereunder and
shall state that [***] shall [***] of [***] in the insurance policy.

ARTICLE 21 - EXCLUSIVITY

         During the Term, SGI shall not develop or commercialize, directly or
indirectly (such as through the grant of a license or distribution rights or
other conveyance of rights) any product comprising [***] related to a [***]or
[***] , together with any [***].  Notwithstanding anything in this Agreement
to the contrary, SGI hereby retains the right to use the [***] for SGI and
its Affiliates' benefit, and to grant licenses and other rights to Third
Parties under the [***], to discover, have discovered, to develop, have
developed, make, have made, import, have imported, export, have exported,
use, sell and have sold (i) products directed toward any [***] other than the
[***] and [***] under this Agreement and (ii) any antibodies directed to any
[***] other than a [***] or [***] under this Agreement.

ARTICLE 22 - MISCELLANEOUS

         22.1.    NOTICES.

          Any consent, notice or report required or permitted to be given or
made under this Agreement by one of the Parties hereto to the other shall be
in writing, delivered personally or by facsimile (and promptly confirmed by
personal delivery, first class air mail or courier), first class air mail or
courier, postage prepaid (where applicable), addressed to such other Party at
its address indicated below, or to such other address as the addressee shall
have last furnished in writing to the address or in accordance with this
Section 22.1 and (except as otherwise provided in this Agreement) shall be
effective upon receipt by the addressee.

----------
[***] CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.

                                      -30-
<Page>

         IF TO SEATTLE GENETICS:
         22215 26th Avenue SE
         Suite 3000
         Bothell, WA 98021
         Attention:  Chief Executive Officer

         WITH COPY TO:
         Venture Law Group
         4750 Carillon Point
         Kirkland, WA  98033
         Attention: Sonya F. Erickson

         IF TO EOS BIOTECHNOLOGY:
         225A Gateway Blvd
         S. San Francisco, CA 94080
         Attention:  Chief Executive Officer

         WITH COPY TO:
         Morgan, Lewis & Bockius LLP
         1701 Market Street
         Philadelphia, PA 19103
         Attention:  Manya S. Deehr

         22.2.    APPLICABLE LAW.

         The Agreement shall be governed by and construed in accordance with the
laws of the State of Washington, without regard to the conflict of law
principles thereof.

         22.3.    DISPUTE RESOLUTION.

         The Parties agree that if any dispute or disagreement arises between
EOS on the one hand and SGI on the other in respect of this Agreement, they
shall follow the following procedure in an attempt to resolve the dispute or
disagreement.

                  (a)      The Party claiming that such a dispute exists shall
give notice in writing ("NOTICE OF DISPUTE") to the other Party of the nature of
the dispute;

                  (b)      Within fourteen (14) business days of receipt of a
Notice of Dispute, a nominee or nominees of EOS and a nominee or nominees of SGI
shall meet in person and exchange written summaries reflecting, in reasonable
detail, the nature and extent of the dispute, and at this meeting they shall use
their reasonable endeavors to resolve the dispute;

                  (c)      If, within a further period of fourteen (14) business
days, the dispute has not been resolved, the President of SGI and the President
of EOS shall meet at a mutually agreed upon time and location for the purpose of
resolving such dispute;

                                      -31-
<Page>

                  (d)      If, within a further period of thirty (30) business
days, the dispute has not been resolved or if, for any reason, the required
meeting has not been held, then the same shall be submitted by the Parties to
arbitration in Seattle, Washington in accordance with the then-current
commercial arbitration rules of the American Arbitration Association ("AAA")
except as otherwise provided herein. The Parties shall choose, by mutual
agreement, one (1) arbitrator within thirty (30) days of receipt of notice of
the intent to arbitrate. If no arbitrator is appointed within the times herein
provided or any extension of time that is mutually agreed upon, the AAA shall
make such appointment within thirty (30) days of such failure. The judgment
rendered by the arbitrator shall include costs of arbitration, reasonable
attorneys' fees and reasonable costs for expert and other witnesses. Nothing in
this Agreement shall be deemed as preventing either Party from seeking
injunctive relief (or any other provisional remedy). If the issues in dispute
involve scientific, technical or commercial matters, any arbitrator chosen
hereunder shall have educational training and/or industry experience sufficient
to demonstrate a reasonable level of relevant scientific, medical and industry
knowledge.

                  (e)      In the event of a dispute regarding any payments
owing under this Agreement, all undisputed amounts shall be paid promptly when
due and the balance, if any, promptly after resolution of the dispute.

         22.4.    ENTIRE AGREEMENT.

         This Agreement contains the entire understanding of the Parties with
respect to the subject matter hereof. All express or implied agreements and
understandings, either oral or written, heretofore made are expressly superseded
by this Agreement. This Agreement may be amended, or any term hereof modified,
only by a written instrument duly executed by both Parties hereto.

         22.5.    INDEPENDENT CONTRACTORS.

         SGI and EOS each acknowledge that they shall be independent contractors
and that the relationship between the two Parties shall not constitute a
partnership, joint venture or agency. Neither SGI nor EOS shall have the
authority to make any statements, representations or commitments of any kind, or
to take any action, which shall be binding on the other Party, without the prior
consent of the other Party to do so.

         22.6.    AFFILIATES

         Each Party shall cause its respective Affiliates to comply fully with
the provisions of this Agreement to the extent such provisions specifically
relate to, or are intended to specifically relate to, such Affiliates, as though
such Affiliates were expressly named as joint obligors hereunder.

         22.7.    WAIVER.

                                      -32-
<Page>

         The waiver by either Party hereto of any right hereunder or the failure
to perform or of a breach by the other Party shall not be deemed a waiver of any
other right hereunder or of any other breach or failure by said other Party
whether of a similar nature or otherwise.

                                      -33-
<Page>

         22.8.    COUNTERPARTS.

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

         IN WITNESS WHEREOF, the Parties have executed this Agreement as of the
date first set forth above.

                                          SEATTLE GENETICS, INC.

                                          By:      /s/ CLAY B. SIEGALL
                                                --------------------------------

                                          Name:     CLAY B. SIEGALL
                                                --------------------------------

                                          Title:   PRESIDENT AND CSO
                                                --------------------------------

                                          EOS BIOTECHNOLOGY, INC.

                                          By:      /s/ DAVID W. MARTIN, JR.
                                                --------------------------------

                                          Name:     DAVID W. MARTIN, JR.
                                                --------------------------------

                                          Title:   PRESIDENT AND CEO
                                                --------------------------------

                                      -34-
<Page>

                                   SCHEDULE A

                        DRUG CONJUGATION TECHNOLOGY FIELD

<Page>

                                   SCHEDULE B

                                LICENSED PATENTS

                             EXISTING SGI TECHNOLOGY

<Table>
<Caption>

------------------------------- ------------------------------------- ----------------- -----------------------
PATENT NO.                      DESCRIPTION                           LICENSOR          [***]
------------------------------- ------------------------------------- ----------------- -----------------------
<S>                             <C>                                   <C>               <C>
[***]                           [***]                                 [***]             [***]
------------------------------- ------------------------------------- ----------------- -----------------------
[***]                           [***]                                 [***]             [***]
------------------------------- ------------------------------------- ----------------- -----------------------
[***]                           [***]                                 [***]             [***]
------------------------------- ------------------------------------- ----------------- -----------------------

</Table>

                        IMPROVEMENTS AND NEW TECHNOLOGIES

<Table>
<Caption>

------------------------------- ------------------------------------- ----------------- -----------------------
PATENT NO.                      DESCRIPTION                           LICENSOR          [***]
------------------------------- ------------------------------------- ----------------- -----------------------
<S>                             <C>                                   <C>               <C>
------------------------------- ------------------------------------- ----------------- -----------------------

------------------------------- ------------------------------------- ----------------- -----------------------

------------------------------- ------------------------------------- ----------------- -----------------------

</Table>

[***] CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.

<Page>

                                   SCHEDULE C

                                RESEARCH ANTIGENS

<Page>

                                   SCHEDULE D

                              ADC PREPARATION TERMS

PREPARATION OF ADC'S BY SGI

-        EOS will provide [***] of each Antibody and any Control Antibody
         requested in connection with such Antibody to SGI in [***].

-        SGI will produce and deliver to EOS [***] of ADC for such Antibody(ies)
         and Control Antibody(ies) [***].

-        SGI will not be obligated to produce ADC's [***].

-        EOS will pay SGI the following amounts for preparation of ADC's for one
         or more [***]:

         AMOUNT($)                  ANTIBODIES (#)

         [***]                      [***]

         [***]                      [***]

         [***]                      [***]

         [***]                      [***]

-        EOS may [***].

-        EOS will pay SGI the following amounts [***]:

         For the toxin and selected linker preparation, SGI will charge [***].
         In addition, EOS will pay the following amount [***]:

                           [***] of ADC
                           [***] of ADC

-        SGI will produce ADCs that [***]

-        SGI's obligations to prepare ADCs hereunder [***]

[***] CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.

<Page>

                                   SCHEDULE E

                                 SGI IN-LICENSES

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