Document:

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                                                                   EXHIBIT 10.17

                                                                  EXECUTION COPY

                   OPERATION, DEVELOPMENT AND SUPPLY AGREEMENT

        This Operation, Development and Supply Agreement (the "Agreement"),
effective as of December 17, 1999 (the "Effective Date"), is made by and between
Third Wave Technologies, Inc., a Wisconsin corporation, ("TWT") and Third Wave
Agbio, Inc., a Delaware corporation ("TWAgbio").

                                   BACKGROUND

        A. TWT and TWAgbio are parties to that certain Investment Agreement
dated as of October 16, 1998 (the "Investment Agreement"). The parties are
entering into this Agreement in compliance with and as fulfillment of Section
5.1 of the Investment Agreement; and

        B. TWT has developed and is further developing a number of nucleic acid
technologies and product platforms including, among others, its proprietary
Invader(TM) assay and Cleavase(R) Fragment Length Polymorphism (CFLP(R))
platforms; and

        C. The parties desire that TWT further develop such technologies and
product platforms for applications within the Field of Agriculture (as defined
below) and supply to TWAgbio certain products and components thereof for use
within the Field of Agriculture; and

        D. The parties also desire to cross-license to each other, technologies
owned and controlled by such party during the term of such development; and

        E. TWAgbio desires that TWT provide certain administrative and
management services to TWAgbio in addition to the research and development
services, and TWT desires to provide such administrative and management
services, all on the terms set forth herein below.

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

                                    ARTICLE 1
                                   DEFINITIONS

        1.1 "Affiliate" shall mean any entity which controls, is controlled by
or is under common control with TWT or TWAgbio. For purposes of this definition,
"control" shall mean beneficial ownership (direct or indirect) of at least fifty
percent (50%) of the ownership interest of the subject entity entitled to vote
in the election of directors (or, in the case of an entity that is not a
corporation, for the election of the corresponding managing authority).
"Controlled Affiliate" shall mean an entity that is controlled by a party to
this Agreement. Notwithstanding the foregoing, neither TWT nor TWAgbio shall be
deemed to be an Affiliate of the other for purposes of this Agreement.

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        1.2 "Annual Plan and Budget" shall mean the annual plan and budget for
the Development Program and Services in effect from time to time, as established
in accordance with Article 3 below.

        1.3 "Cleavase Enzyme" shall mean any enzyme with the ability to cleave a
nucleic acid in a structure-dependent manner in each case Controlled by TWT or
TWAgbio or its respective Controlled Affiliates during the Term of the
Development Program, including without limitation, those enzymes listed on
Exhibit 1.3 hereto.

        1.4 "Cleavase Fragment Length Polymorphism Assay" or "CFLP Assay" shall
mean a biochemical test for detection of variation within a nucleic acid,
including detection of such variation without prior knowledge of the locus at
which the variation may occur or detection of known variations, that is
dependent upon the formation of internal base-paired secondary structures in the
nucleic acid being investigated and the partial digestion of such structures
using a structure-specific nuclease, and that uses TWT Technology, in such
format as the parties may mutually agree in writing from time to time.

        1.5 "Confidential Information" shall have the meaning as set forth in
Section 12.1 below.

        1.6 "Control" shall mean possession of the ability to grant a license or
sublicense as set forth in this Agreement without violating the terms of any
agreement with a third party.

        1.7 "Costs" shall mean collectively the Development Costs and Service
Costs.

        1.8 "Design Software" shall mean the InvaderCreator(TM) Software
developed by and on behalf of TWT for use in design, quality control, data
collection and analysis of oligonucleotide probe sets for Invader Products,
which exists as of the date of this Agreement together with any enhancements,
updates, upgrades, bug-fixes thereto, in each case to the extent Controlled by
TWT or its Controlled Affiliates prior to or during the Term of the Development
Program.

        1.9 "Development Costs" shall mean all direct and indirect costs
incurred by or on behalf of TWT in conducting the Development Program,
including, (i) costs of research and development materials and equipment
allocable to the Development Program, (ii) development milestones or other
amounts payable to third parties under a Third Party Agreement as a result of
performance of the Development Program, (iii) reasonable costs of insurance
allocable to the Development Program, (iv) costs associated with establishing
and validating TWT facilities to manufacture Products, and (v) such other
amounts as reflected in the Annual Plan and Budget, all as calculated in
accordance with GAAP. The Development Costs shall additionally include ten
percent (10%) of the direct and indirect costs incurred by or on behalf of TWT
in developing, updating, maintaining and operating the Design Software and
acquiring and maintaining hardware and ancillary software for use therewith;
provided that such costs are not otherwise included in the Development Costs
under the Development Program. For avoidance of doubt, Development Costs may
include depreciation charges for facilities and equipment utilized in the course
of performing and allocable to the Development Program, as calculated in
accordance with GAAP; provided that the costs of such facilities or equipment
have not been previously included in the Development Costs.

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        1.10 "Development Personnel" shall mean employees of TWT assigned (full-
or part-time) to perform research, development or regulatory affairs activities
under the Development Program, including project managers, scientists, research
and manufacturing staff, post-doctoral fellows, quality control and assurance
personnel, technicians or the like, but excluding non-technical,
non-professional personnel such as administrative and secretarial staff.

        1.11 "Development Program" shall mean activities with respect to the
research and development of the TWT Technology or Products for applications
within the Field, comprising all activities relating to the research and
development of Products including without limitation basic research related to
the Field, all conducted in accordance with Annual Plan and Budget in effect at
the time. For avoidance of doubt, the Development Program will include, but not
be limited to, the development and documentation of final processes for the
preparation, manufacturing and or use of Products to be supplied by TWT
hereunder for applications within the Field.

        1.12 "Field" or "Field of Agriculture" shall have the meaning as set
forth on Exhibit 1.12. hereto.

        1.13 "Full-Time Equivalent" or "FTE" shall mean a full-time person, or
in the case of less than a full-time dedicated person, a full-time, equivalent
person year, based upon a total of one thousand eight hundred eighty (1,880)
hours per year, of work related to the Development Program and/or Services, as
applicable. For purposes of the foregoing, "employees" shall include "contract
workers" who work at a TWT's facilities under TWT's direction, but do not
include outside consultants, such as third-party service providers, regulatory
affairs consultants, academic collaborators or the like.

        1.14 "GAAP" shall mean Generally Accepted Accounting Principles and cost
accounting principles generally accepted in the United States then in effect at
the time of initial accounting (as may be modified and updated from time to
time).

        1.15 "Invader Assay" shall mean a biochemical test for detecting and/or
quantifying a specific nucleic acid target sequence within a nucleic acid
mixture that is dependent upon the coordinate actions of at least two (2)
target-specific probes and a structure-specific nuclease, and that uses TWT
Technology.

        1.16 "Invader Squared Assay" shall mean an assay system which uses one
Invader Assay reaction (the "Secondary Invader Reaction") to detect and amplify
the signal generated by the cleavage product of another (either simultaneous or
sequential) Invader Assay reaction (the "Primary Invader Reaction") for
detection and/or quantification of the nucleotide sequence of interest. In the
Invader Squared Assay format the Secondary Invader Reaction uses the cleavage
product from the Primary Invader Reaction (i.e., the oligonucleotide sequence
located at the 5'-end of the Signal Probe of the Primary Invader Reaction) as
its Invader Probe.

        1.17 "Joint Development Committee" or "JDC" shall have the meaning as
set forth in Section 2.1 below.

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        1.18 "Manufacturing Standards" shall mean, with respect to Probe Sets,
Products or Cleavase Enzyme, the generally accepted industry manufacturing
standards for "Research Use Only" products and such additional manufacturing
specifications or standards as may be established therefor by mutual agreement
of the parties from time to time.

        1.19 "Probe Set" shall mean the Invader Probes and the Signal Probes to
the particular nucleotide target in a particular Primary Invader Reaction
(respectively, the "Primary Invader Probes" and "Primary Signal Probes").

            1.19.1 "Invader Probe" shall mean a probe(1) comprising a region
complementary(2) to the 3'-portion of the sequence of the applicable Target, and
a region that overlaps the duplex formed by the corresponding Signal Probe and
Target by at least a single nucleotide base. The 3'-terminal base of the Invader
Probe may be complementary or noncomplementary to the Target.

            1.19.2 "Signal Probe" shall mean a probe(1) which is overlapped by
the Invader Probe and which comprises a region complementary(2) to the 5'
portion of the sequence of the particular Target. The cleavage or non-cleavage
of the Signal Probe may be detected by label detection, mass spectroscopy,
electrophoritic separation or other detection methods.

        1.20 "Product(s)" shall mean, collectively or individually, any products
or components made or developed utilizing or otherwise based upon or
incorporating TWT Technology with application in the Field. For purposes of this
Agreement, Products shall include Probe Sets, Finished Invader Assays and
Standard Invader Reagent Plates, but for all purposes shall exclude Cleavase
Enzymes not incorporated into a Finished Invader Assay, CFLP Assay or Standard
Invader Reagent Plate.

            1.20.1 "Finished Invader Assay" shall mean an Invader Assay in
Invader Squared Assay-FRET (fluorescence resonance energy transfer) format
and/or such other format(s) as the parties may mutually agree in writing from
time to time.

            1.20.2 "Standard Invader Reagent Plate" or "SIRP" shall mean, for
Finished Invader Assays, a reagent package comprised of a microtiter reaction
plate (96, 384 or 1536-well or other similar plate configuration(s) as the
parties may agree from time to time) containing (i) purified FRET-Signal
Probe/Target complex for the Secondary Invader Reaction, (ii) buffer solution
and (iii) appropriate Cleavase Enzyme(s), and/or such other reagent(s) as the
parties may mutually agree in writing from time to time.

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    (1) The Invader Probe and/or Signal Probe are generally oligonucleotides,
but may be comprised of structures which hybridize to the Target such as DNA,
RNA, PNA, modified nucleotides, universal bases, adducts, etc. and combinations
thereof.

    (2) The Invader Probe and/or Signal Probe allow for areas of
noncomplementarity (i.e., one or more base pair mismatches) to the cognate
sequence of the Target.

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        1.21 "Production Costs" shall mean, with respect to a Product or
Cleavase Enzyme, all fully-allocated direct and indirect costs that are incurred
by or on behalf of TWT, or its respective Affiliate associated with the
manufacture, filling, packaging, labeling and/or other preparation of such
Product or Cleavase Enzyme, including without limitation the costs of
facilities, labor, equipment, materials and validation studies, quality
assurance, quality control and other testing, storage, shipping and other
resources (including an allocation of general and administration overhead)
consumed in or otherwise allocated to the manufacture, filling, packaging,
labeling and/or other preparation of such Product or Cleavase Enzyme, in each
case calculated in accordance with GAAP. Production Costs shall include (i)
allowances associated with wastage and failed or discarded lots of Products or
Cleavase Enzyme and (ii) depreciation charges for facilities and equipment
utilized in the manufacture, filling, packaging, labeling and/or other
preparation of such Product or Cleavase Enzyme hereunder to the extent not
otherwise included in the Production Costs. With respect to Products or Cleavase
Enzyme acquired by TWT from a non-Affiliate third party, the Production Costs
for such Products, Cleavase Enzyme or components of either shall be deemed to be
the amounts paid to such third party therefor, plus costs associated with the
acquisition from such vendor, including without limitation, freight and handling
charges and quality control or assurance services provided by or on behalf of
TWT.

        1.22 "Service Costs" shall mean all direct and indirect costs incurred
by or on behalf of TWT in performing Services hereunder in accordance with the
Annual Plan and Budget, all as calculated using GAAP; provided that such amounts
are not otherwise included in the Development Costs.

        1.23 "Service Personnel" shall mean employees of TWT assigned (full- or
part-time) to perform Services hereunder.

        1.24 "Services" shall have the meaning as set forth in Section 4.1
below.

        1.25 "Specifications" shall mean, with respect to a particular Probe
Set, Product or Cleavase Enzyme, the written specifications initially designated
by TWT therefor and thereafter modified by the JDC.

        1.26 "Term of the Development Program" shall mean the Initial Term of
the Development Program and any Extension Period.

            1.26.1 "Initial Term of the Development Program" shall mean the
period from the Effective Date until the earlier of (i) December 31, 2003 or
(ii) the effective date of termination of the Development Program if terminated
in accordance with Section 14.4 below.

            1.26.2 "Extension Period" shall have the meaning as set forth in
Section 14.3 below.

        1.27 "Territory" shall mean worldwide.

        1.28 "Third Party Agreements" shall mean collectively those agreements
between TWT and a third party existing as of the Effective Date as listed on
Exhibit 1.28 hereto, pursuant to which

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TWT obtained rights to TWT Technology applicable to the Field. If after the
Effective Date either TWT and/or TWAgbio enter into an agreement to license or
acquire rights from a third party with respect to subject matter in accordance
with Section 9.10.2 below, such agreements shall also be deemed Third Party
Agreements for purposes of this Agreement.

        1.29 "Transfer Price" shall mean, with respect to Probe Sets, Finished
Products (including components manufactured by or on behalf of TWT) or Cleavase
Enzyme supplied by TWT pursuant to Section 7.2 below, one hundred thirty five
percent (135%) of the Production Cost therefor. Notwithstanding the foregoing,
the Transfer Price with respect to Probe Sets (on a stand alone basis) or
Finished Products manufactured entirely by one or more third parties on behalf
of TWT for supply hereunder to TWT, one hundred ten percent (110%) of the
Production Cost therefor.

        1.30 "TWAgbio Technology" shall mean the TWAgbio Patents and the TWAgbio
Technical Information.

            1.30.1 "TWAgbio Patents" shall mean any and all patents and all
reissues, renewals, re-examinations, and extensions thereof, and patent
applications therefor, any divisions or continuations, in whole or in part,
thereof and patents of addition thereto, in each case to the extent the such
patents and patent applications claim subject matter conceived and reduced to
practice prior to or during the Term of the Development Program and to the
extent such patents and patent applications are Controlled by TWAgbio or its
Controlled Affiliates. Notwithstanding the foregoing, the TWAgbio Patents shall
not include any patent or patent application licensed or acquired by TWAgbio or
its Controlled Affiliates after the expiration or termination of the Term of the
Development Program.

            1.30.2 "TWAgbio Technical Information" shall mean confidential
information, tangible or intangible, and materials, including but not limited
to: chemical, biological, genetic and biochemical compositions; and technical
and non-technical data and information, and/or the results of tests, assays,
methods and processes; and plans, specifications and/or other documents
containing said information and data; in each case that is possessed by TWAgbio
as of the Effective Date or discovered, developed or acquired by TWAgbio or its
Controlled Affiliates during the Term of the Development Program, to the extent
such relates to the TWT Field and to the extent that TWAgbio or its Controlled
Affiliate Controls the same.

        1.31 "TWT Field" shall mean all applications not included in the Field
of Agriculture. For avoidance of doubt, the TWT Field shall include, without
limitation, all applications related to: (i) the discovery, production or
development of products, processes or methods for diagnostic or therapeutic
applications in humans, including the discovery, development, use and raising of
animal models of human disease and all other applications related to human
health; and (ii) processed food safety.

        1.32 "TWT Product(s)" shall mean, collectively and individually, any
product or components made or developed utilizing or otherwise based upon or
incorporating TWAgbio Technology with application in the TWT Field.

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        1.33 "TWT Technology" shall mean the TWT Patents and TWT Technical
Information.

            1.33.1 "TWT Patents" shall mean any and all patents and all
reissues, renewals, re-examinations, and extensions thereof, and patent
applications therefor, any divisions or continuations, in whole or in part,
thereof and patents of addition thereto, in each case to the extent such patents
and patent applications claim subject matter conceived and reduced to practice
prior to or during the Term of the Development Program and to the extent such
patents and patent applications are Controlled by TWT or its Controlled
Affiliates. Notwithstanding the foregoing, the TWT Patents shall not include any
patent or patent application licensed or acquired by TWT or its Controlled
Affiliates after the expiration or termination of the Term of the Development
Program. For avoidance of doubt, the TWT Patents shall exclude those patents and
patent applications licensed under that certain Exclusive License Agreement by
and between The Regents of University of California and TWT effective as of
February 21, 1996 which were exclusively licensed to Boehringer Mannheim
Corporation pursuant to that certain License Agreement dated March 27, 1996.

            1.33.2 "TWT Technical Information" shall mean confidential
information, tangible or intangible, and materials, including but not limited
to: chemical, biological, genetic and biochemical compositions; and technical
and non-technical data and information, and/or the results of tests, assays,
methods and processes; and plans, specifications and/or other documents
containing said information and data; in each case that is possessed by TWT as
of the Effective Date or discovered, developed or acquired by TWT or its
Controlled Affiliates during the Term of the Development Program, to the extent
such relates to the Field and to the extent that TWT or its Controlled Affiliate
Controls the same. Without limiting the foregoing, it is understood and agreed
that the TWT Technical Information shall include the Development Software, to
the extent Controlled by TWT or its Controlled Affiliates during the Term of the
Development Program.

        1.34 TWT Trademarks shall mean the trademarks listed on Exhibit 1.34.

                                    ARTICLE 2
                           JOINT DEVELOPMENT COMMITTEE

        2.1 Joint JDC. TWT and TWAgbio shall establish a joint development
committee to oversee, review and coordinate the Development Program ("Joint
Development Committee" or "JDC"). From time to time, the JDC may establish
subcommittees or project teams to oversee particular projects or activities, and
such subcommittees or project teams will be constituted as the JDC agrees (e.g.,
for oversight of the research, development, supply or other day-to-day matters).

        2.2 Membership. The JDC shall be comprised of an equal number of
representatives from each of TWAgbio and TWT, selected by such party (with the
TWAgbio representatives being selected by the TWAgbio Board of Directors or
their designee). The exact number of such representatives shall be three (3) for
each of TWAgbio and TWT, or such other number as the parties may agree. Each
party shall at all times have at least one (1) representative on the JDC at the
Senior Vice President level or above. Subject to the foregoing provisions of
this Section 2.2, TWT and

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TWAgbio may replace its respective JDC representatives at any time, with prior
written notice to the other party.

        2.3 JDC Meetings. During the Term of the Development Program, the JDC
shall meet quarterly, or as otherwise agreed by the parties, at such locations
as the parties agree. At its meetings, the JDC will (i) formulate and review the
Development Program and Service objectives, (ii) monitor the progress of the
Development Program and Services toward those objectives, (iii) review and
approve the Annual Plan and Budget, pursuant to Article 3 of this Agreement, and
(iv) undertake and/or approve such other matters as are provided for the JDC
under this Agreement or mutually agreed by the parties. With the consent of the
parties, other representatives of TWT or TWAgbio may attend JDC or subcommittee
meetings as non-voting observers. The JDC may also convene or be polled or
consulted from time to time by means of telecommunications, video conferences or
correspondence, as deemed necessary or appropriate. Each party shall bear its
own personnel, travel and lodging expenses relating to JDC meetings.

        2.4 Decisions. Decisions of the JDC shall be made by unanimous agreement
of the members present in person or by other means (e.g., teleconference) at any
meeting; provided that at least two (2) representatives of each party are
present at such meeting. In the event that the JDC is unable to reach unanimous
agreement on an issue, either party or the JDC may refer for resolution through
good faith negotiations between the Chief Executive Officers of each TWT and
TWAgbio. If thirty (30) days after the date of the referral such executives are
unable to resolve the issue, then upon request by either party such issue shall
be resolved in accordance with Article 15 below.

                                    ARTICLE 3
                            ANNUAL PLANS AND BUDGETS

        3.1 Annual Plans and Budgets. During the Term of the Development
Program, TWT shall prepare and provide to the JDC a reasonably detailed Annual
Plan and Budget pursuant to which TWT's performance of the Development Program
and Services will be carried out. The Annual Plan and Budget shall specify the
objectives and work plan activities with respect to: (i) subject to 3.5 below,
the Development Program, including the headcount of Development Personnel and
other costs and expenses of the Development Program (e.g., consultants and third
party contractors) and (ii) the Services, and the Service Costs and Service
Personnel for such Services, including consultants and third party contractors
and facilities with respect thereto.

        3.2 Annual Review. The parties have agreed on an initial written Annual
Plan and Budget which shall be fixed for the period from the Effective Date
through December 31, 2000, unless otherwise agreed. Not later than October 15 of
each year during the Term of the Development Program, TWT shall submit to the
JDC a reasonably detailed Annual Plan and Budget pursuant to which the
Development Program and Services will be performed during the following fiscal
year. The JDC shall review such proposals as soon as possible and shall
establish and approve no later than December 1 of such year the final Annual
Plan and Budget for the next succeeding year. Notwithstanding the foregoing, if
at any time the JDC fails to establish an Annual Plan and Budget for a
particular fiscal year, the budget specified in the last Annual Plan and Budget
approved

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by the JDC shall become the interim budget until a Annual Plan and Budget is
established in accordance with Article 15 below and in such case such amounts
shall be spent by TWT on activities within the Field and/or Services provided on
behalf of TWAgbio. For avoidance of doubt, it is understood and agreed that an
Annual Plan and Budget established pursuant to Section 15.3 below may not
necessarily be based on the last Annual Plan and Budget.

        3.3 Periodic Reviews. The JDC shall review the Annual Plan and Budget on
an ongoing basis and may make changes thereto; provided, however, the Annual
Plan and Budget in effect for a particular fiscal year shall not be modified
except as approved by the JDC or as provided in this Article 3.

        3.4 Modifications to the Annual Plan and Budget. TWT may propose
modifications to the Annual Plan and Budget from time to time. Within forty-five
(45) days following a request by TWT for modification to the Annual Plan and
Budget, and the delivery of a modified Annual Plan and Budget, pursuant to this
Section 3.4, the JDC shall either accept or reject such modified Annual Plan and
Budget; provided, however, that unless TWAgbio and TWT otherwise agree, the
Annual Plan and Budget shall not be modified more frequently than once in each
fiscal year pursuant to this Section 3.4.

        3.5 Development FTEs. Notwithstanding anything herein to the contrary,
the Annual Plan and Budget shall include at least three (3) TWT FTEs until June
30, 2000, at least four (4) TWT FTEs until December 31, 2000, and thereafter at
least five (5) TWT FTEs, and no more than twenty (20) TWT FTEs for the
Development Program, unless otherwise agreed by the TWT and TWAgbio in writing.

                                    ARTICLE 4
                                    SERVICES

        4.1 Services. TWAgbio hereby engages TWT to provide, or arrange to
provide, to TWAgbio its general, administrative and management services,
including, without limitation, the services described generally below
(collectively, "Services"). TWT agrees to use its diligent efforts to provide,
under the direction of the TWAgbio Board of Directors, specific services within
the following general categories, at the times and in the manner in which TWT
deems necessary or appropriate to effect such direction, in each case in
accordance with the Annual Plan and Budget then in effect:

            4.1.1 General. advice and services with respect to accounting and
financial matters, marketing, government and public relations, industrial
relations, personnel administration, procurement, purchasing, inventory control,
business development, corporate partnering, planning and investigation,
management information systems, administrative matters and insurance;

            4.1.2 Treasury. treasury services, including, without limitation,
maintenance of books and records, bank accounts, preparation of budgets,
forecasts and financial statements, cashier, payment, payroll, credit and
collections and money management assistance;

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            4.1.3 Recordkeeping. recordkeeping services, including accounting,
tax records, audits, stockholder, director and committee records and sales
records;

            4.1.4 Employee. for the employees of TWAgbio, services with respect
to the provision of certain employee benefits, including medical and dental
insurance benefits, disability benefits, and benefits under any life and
accidental death and dismemberment plan, occupational health services plan, and
flexible spending accounts plan;

            4.1.5 Recruiting. services with respect to selection, recruiting,
supervision and evaluation of personnel;

            4.1.6 Legal. advice and services with respect to intellectual
property, regulatory, legal and tax matters, including, without limitation,
filings and hearings before foreign, federal, state and municipal agencies or
authorities; and

            4.1.7 Other. such other advice and services as are reasonably
requested by TWAgbio in order to implement the TWAgbio Board of Directors'
reasonable directions.

        Notwithstanding the foregoing, it is understood that TWAgbio may elect
to provide some or all of the Services on its own behalf.

        4.2 Standard of Care. In providing Services hereunder, TWT shall use,
and TWAgbio hereby agrees to accept in all respects, the same standard of skill
and care that TWT uses in the course of undertaking similar services for itself.
To the extent reasonably possible, such services shall be substantially
identical in nature and quality to similar services currently provided or
otherwise obtained by TWT on its own behalf and its employees.

        4.3 TWT Activities. TWAgbio hereby acknowledges that TWT may have
business interests, and engage in business activities, in addition to those
relating to TWAgbio for its own account and for the account of others, without
having or incurring any obligation to offer any interest in such businesses,
activities or opportunities to TWAgbio other than as provided hereunder. TWAgbio
shall not have any rights by virtue of this Agreement or the relationship
created hereby in any such business interests, activities or opportunities.

        4.4 Approval of Contracts and Commitments. Prior to making or entering
into any written commitment or contract on behalf of TWAgbio that involves
obligations of, or payments by, TWAgbio in excess of $50,000, TWT shall first
obtain the written approval in accordance with the delegation of authority
documentation approved by the TWAgbio Board of Directors from time to time.

        4.5 Subcontracting. Subject to TWAgbio's written consent, which consent
shall not be unreasonably withheld or delayed, TWT may engage third parties to
perform all or any portion of the Services hereunder; provided, however, that no
such consent shall be required for the engagement by TWT of any third party to
perform such Services if TWT customarily engages third parties to perform
similar services for itself.

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        4.6 Employee Incentives. TWT shall use its commercially reasonable
efforts to structure the compensation paid to TWT employees who work primarily
on TWAgbio matters in such a manner that incents such employees to meet the
business goals and objectives of TWAgbio by utilizing such goals and objectives
to assess employee performance to the same extent as TWT utilizes business goals
and objectives of TWT to assess the performance of employees who work solely for
TWT.

        4.7 Reports. TWT shall keep the JDC and the TWAgbio Board of Directors
reasonably informed as to the progress of the Services hereunder.

                                    ARTICLE 5
                               DEVELOPMENT PROGRAM

        5.1 Development Program. TWT shall be responsible for conducting,
directly or through third parties, the Development Program in accordance with
the Annual Plan and Budget then in effect. TWT agrees to keep the JDC reasonably
informed as to the progress of the Development Program hereunder. TWAgbio shall
provide reasonable assistance to TWT regarding the Development Program. TWAgbio
shall be consulted and informed with respect to the Development Program through
its representatives on the JDC and as mutually agreed in writing.

        5.2 Development Program Funding. Subject to Section 3.5, TWAgbio shall
fund TWT's conduct of the Development Program; and subject to Section 14.5.3,
TWT shall apply all amounts paid by TWAgbio in accordance with Section 6.2
toward the Development Program.

        5.3 Reports and Records.

            5.3.1 Records. During the Term of the Development Program, TWT shall
use reasonable efforts to maintain records of the Development Program (or cause
such records to be maintained) in sufficient detail and in good scientific
manner as will properly reflect all work done and results achieved in the
performance of the Development Program. Upon reasonable advance notice, TWT
shall allow TWAgbio to have reasonable access to such records, materials and
data generated by or on behalf of such party with respect to the Field and
Products at reasonable times and in a reasonable manner.

            5.3.2 Reports. During the Term of the Development Program, TWT shall
at least annually provide the JDC with a written report summarizing the progress
of the Development Program hereunder during the preceding period.

        5.4 Publications. Subject to the provisions of Article 12 and this
Section 5.4, TWT shall have the right to publish the results of the Development
Program in any manner consistent with academic standards.

            5.4.1 Prior Review. Prior to the oral public disclosure, and prior
to the submission to any outside person for publication of an abstract or
manuscript describing the scientific data

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<PAGE>   12

resulting from the Development Program related to the Field, in each case to the
extent the contents of the oral disclosure, abstract or manuscript have not been
previously disclosed pursuant to this Section 5.4 before such proposed
disclosure, TWT shall provide to TWAgbio a copy of the abstract, manuscript, or
a written summary of any oral disclosure, to be made or submitted, and shall
allow a person designated by TWAgbio reasonable opportunity to determine whether
such disclosure or manuscript contains subject matter for which patent
protection should be sought prior to publication or which it believes should be
modified to avoid disclosure of Confidential Information of TWAgbio. With
respect to publications by investigators or other third parties related to the
Field, such publications shall be subject to review by TWAgbio under this
Section 5.4 only to the extent that TWT has the right to do so.

            5.4.2 Delay of Publication. If TWAgbio notifies TWT within fifteen
(15) days after receipt of such manuscript or seven (7) days after receipt of
such oral presentation or abstract, that in its determination that such oral
presentation, abstract or manuscript contains Confidential Information of
TWAgbio or objectionable material or material that consists of patentable
subject matter for which patent protection should be sought. TWT shall withhold
its proposed public disclosure and confer with TWAgbio to determine the best
course of action to take in order to modify the disclosure (including removing
Confidential Information of TWAgbio) or to file for patent protection. After
resolution of the confidentiality or other issues, or the filing of a patent
application (including a provisional application) or due consideration as to
whether a patent application can reasonably be filed, but in no event more than
thirty (30) days after notification of TWT as provided above, TWT shall be free
to submit the abstract or manuscript and/or make its public oral disclosure. If
TWT declines to file an appropriate patent application, then TWAgbio may
undertake to file such application in accordance with Section 10.2 below.

                                    ARTICLE 6
                                     FUNDING

        6.1 Costs.

            6.1.1 FTEs. An FTE rate determined in accordance with this Section
6.1 shall be used for purposes of determining the Costs incurred with respect to
Development Personnel and Service Personnel. The FTE rate shall be as set forth
on Exhibit 6.1 based on classification (as adjusted below). The FTE rate
includes all salary, employee benefits, materials and other expenses including
support staff and overhead for or associated with an FTE, but does not include
travel and lodging expenses incurred by such FTEs in performance of the
Development Program or Services (which travel and lodging expenses shall be
included in Costs separately under Section 6.1.2 below). Effective beginning
with the calendar year 2000, the FTE rate for Development Personnel shall
increase no more than once annually by the percentage increase, if any, in the
Radford Associates Annual Biotechnology Compensation and Benefits Survey since
January 1, 1999 or the last such increase, whichever is later, upon thirty (30)
days prior written notice to TWAgbio and such increase shall be effective for
the then-current and all subsequent Annual Plans and Budgets hereunder until
further modified under this Section 6.1.

                                      -12-
<PAGE>   13

            6.1.2 Non-FTE Costs. It is understood that the Costs will include
reasonable costs for items other than FTEs, including without limitation amounts
paid to consultants, third-party service providers, sponsored research, or the
like. In addition, Costs may include costs for equipment and facilities acquired
for purposes of the Development Program and/or Services, as appropriate;
provided that if such equipment or facilities are used both (i) in the course of
performing the Development Program and/or Services and (ii) for other purposes
by TWT, then the costs of such equipment or facilities shall be allocated
between the Development Program and/or Services and such other purposes in
accordance with GAAP. It is understood that if TWT acquires any capital
equipment or facilities in connection with the Development Program and/or
Services, whether or not separately identified in the Annual Plan and Budget,
TWT shall own all such capital equipment and facilities, unless the parties
otherwise agree.

        6.2 Payment. On or before the first day of each calendar quarter,
TWAgbio shall pay to TWT the amounts budgeted for the upcoming quarter in the
Annual Plan and Budget then in effect. Unless otherwise specified in the Annual
Plan and Budget, amounts budgeted for the full year will be deemed budgeted in
equal amounts for each calendar quarter during such year. Within ninety (90)
days following the end of each TWT fiscal year, TWT shall provide to TWAgbio a
summary of the Costs actually incurred during each quarter by TWT during such
year. If the actual Costs incurred by TWT in such year are less than the amounts
advanced by TWAgbio, then the difference will be carried forward and credited to
the payment to be advanced for the next quarters. If such Costs were greater
than the amount advanced by TWAgbio, then TWAgbio agrees to pay the difference
within thirty (30) days of receiving TWT's invoice, subject to Section 6.3 below
and subject to TWAgbio's verification of those expenses during such thirty (30)
day period.

        6.3 Excess Costs. To the extent the Costs incurred by TWT exceed by more
than ten percent (10%) of the Costs budgeted for a fiscal year in the Annual
Plan and Budget then in effect, TWAgbio shall not be responsible to reimburse
any portion of such excess Costs unless TWAgbio's Board of Directors approves
such excess Costs, which approval shall not be unreasonably withheld to the
extent the incurrence of such excess costs was not within the reasonable control
of TWT. Notwithstanding anything herein to the contrary, TWT shall not be
obligated to incur amounts in the conduct of the Development Program or Services
or with respect to the Field in excess of the amounts paid by TWAgbio with
respect thereto.

                                    ARTICLE 7
                             MANUFACTURE AND SUPPLY

        7.1 Manufacturing Rights.

            7.1.1 Finished Products. Except as otherwise expressly provided
herein, TWT shall have the exclusive right to manufacture or have manufactured
and supply Finished Invader Assays, CFLP Assays, SIRPs or other finished kits
for use by end-users comprising Products (collectively, "Finished Products");
provided that if TWT is unable or elects not to so supply Finished Products, in
accordance with Section 7.2 below, TWAgbio will have the right to manufacture or
have manufactured Finished Products using Cleavase Enzymes supplied or
manufactured in accordance

                                      -13-
<PAGE>   14

with this Article 7. Subject to Section 7.2.9 below, TWT's exclusive right to
manufacture and supply pursuant to this Section 7.1.1 shall continue for a
minimum of three (3) years from the Effective Date. Thereafter subject to the
terms and conditions of this Agreement including Section 9.5.2, TWAgbio shall
have the non-exclusive right to manufacture or have manufactured Finished
Products for applications within the Field using Cleavase Enzymes manufactured
in accordance with Section 7.1.2 below.

            7.1.2 Cleavase Enzymes. Except as otherwise expressly provided
herein, TWT shall have the exclusive right to manufacture or have manufactured
and supply Cleavase Enzymes; provided that if TWT is unable or elects not to so
supply such Cleavase Enzymes, TWAgbio will have the right to manufacture or have
manufactured Cleavase Enzymes in accordance with Section 7.2.9 below. TWT's
exclusive right to manufacture or have manufactured and supply in this Section
7.1.2 shall continue for a minimum of five (5) years from the Effective Date.
Thereafter subject to the terms and conditions of this Agreement including
Section 9.5.2, TWAgbio shall have the non-exclusive right to manufacture or have
manufactured Cleavase Enzymes for purposes of manufacturing or having
manufactured Finished Products for applications within the Field.

        7.2 Supply. Subject to the terms and conditions of this Section 7.2, TWT
shall manufacture or have manufactured in accordance with Manufacturing
Standards and supply TWAgbio with TWAgbio's requirements for Probe Sets or
Finished Products for application in the Field or Cleavase Enzymes for purposes
of manufacturing or having manufactured Finished Products for application in the
Field.

            7.2.1 Forecasts. For so long as TWT is supplying Probe Sets,
Finished Products or Cleavase Enzymes to TWAgbio hereunder, at least thirty (30)
days prior to the start of any calendar month ("M1"), TWAgbio shall provide TWT
with a rolling written forecast of the quantities of Probe Sets, Finished
Products or Cleavase Enzyme (on a product-by-product basis) estimated to be
required on a month-by-month basis for the following six (6) consecutive months
("M1" to "M6", respectively). Each forecast shall indicate the estimated
quantities of Probe Sets, Finished Products and Cleavase Enzyme identified by
the catalog number (if applicable) designated by TWT. Except as set forth in
Section 7.2.2 below, TWAgbio will provide such forecasts as a means of
production planning only and shall not constitute a binding obligation upon TWT
or TWAgbio.

            7.2.2 Orders. Together with each forecast provided under Section
7.2.1 above (the "Current Forecast"), TWAgbio shall place its firm order with
TWT for delivery in M1 to M3 of that quantity of Probe Sets, Finished Products
or Cleavase Enzymes equal to the quantity therefor reflected for M1 to M3 in the
Current Forecast. For ordering purposes, the forecast for M3, once set, will be
fixed for that calendar month, as it rolls to M2 and then M1 (i.e., the quantity
forecasted for M3 in the Current Forecast shall be the quantity forecasted for
M2 in the immediately next Current Forecast and the quantity forecasted for M1
in the Current Forecast following such next Current Forecast). Also, the
forecasts for M4, M5 and M6 shall not be modified for that calendar month by
more than +/- 25%, as each rolls to M3. TWT may, but is not obligated to, accept
orders from TWAgbio for quantities in excess of the preceding variances. A
minimum quantity order shall be agreed upon by the parties on a
product-by-product basis.

                                      -14-
<PAGE>   15

            7.2.3 Form of Order. TWAgbio's orders shall be made pursuant to a
written purchase order or such other form which is in a form mutually acceptable
to the parties, and shall provide for shipment in accordance with reasonable
delivery schedules as may be agreed upon from time to time by TWT and TWAgbio.
TWT shall use reasonable efforts to notify TWAgbio within ten (10) days from
receipt of an order of its ability to fill quantities ordered thereunder.
Notwithstanding the foregoing, the parties may agree that TWT may accept
purchase orders on behalf of TWAgbio directly from TWAgbio's customers, in which
event such customer purchase order shall be deemed a TWAgbio purchase order for
purposes of this Section 7.2 and the parties will agree on a proposal to address
such situation. ANY ADDITIONAL OR INCONSISTENT TERMS OR CONDITIONS OF ANY
PURCHASE ORDER OR ACKNOWLEDGMENT GIVEN OR RECEIVED PURSUANT TO THIS AGREEMENT
SHALL HAVE NO EFFECT AND SUCH TERMS AND CONDITIONS ARE HEREBY EXCLUDED.

            7.2.4 Delivery. With respect to exact shipping dates, TWT shall use
its reasonable efforts to ship forecasted quantities of Probe Sets, Finished
Products and Cleavase Enzymes in accordance with orders submitted and accepted
in accordance with Sections 7.2.2 and 7.2.3 above.

            7.2.5 Shipping. All Probe Sets, Finished Products and Cleavase
Enzymes delivered pursuant to the terms of this Section 7.2 shall be suitably
packed for shipment by TWT and marked for shipment to the destination point
indicated in TWAgbio's purchase order. All Products will be delivered FOB
(U.C.C.) to the shipping point designated by TWT. The carrier shall be selected
by agreement between TWT and TWAgbio, provided that in the event no such
agreement is reached TWAgbio shall select the carrier. All shipping and
insurance costs, as well as any special packaging expenses, shall be paid by
TWAgbio.

            7.2.6 Invoicing. TWT shall submit an invoice to TWAgbio upon
shipment of Probe Sets, Finished Products or Cleavase Enzyme ordered by TWAgbio.
All invoices shall be sent to TWAgbio's address for notices hereunder, and each
such invoice shall state TWAgbio's aggregate and unit Transfer Price therefor in
a given shipment, plus any insurance, taxes or other costs incident to the
purchase or shipment initially paid by TWT but to be borne by TWAgbio hereunder.

            7.2.7 Product Acceptance/Returns. Each shipment of Probe Sets,
Finished Products or Cleavase Enzyme hereunder shall be accompanied by certified
quality control protocol and certificate of analysis for each lot therein if
requested by TWAgbio as well as such customs and other documentation, as is
necessary or appropriate. Without limiting the foregoing, if any Probe Set,
Finished Product or Cleavase Enzyme supplied hereunder fails to conform to the
applicable Specifications or Manufacturing Standards, then TWAgbio or its
designee shall promptly notify TWT. Any Probe Set, Finished Product or Cleavase
Enzyme supplied by TWT under this Agreement which fails to conform to the
applicable Specifications shall be subject to the provisions of Section 11.2
below.

            7.2.8 Allocation. In the event that TWT is unable to supply both
worldwide requirements of a Finished Product or Cleavase Enzyme and quantities
ordered by TWAgbio under Section 7.2.2 above due to force majeure or otherwise,
TWT shall allocate the quantities of such

                                      -15-
<PAGE>   16

Product or Cleavase Enzyme that TWT has in inventory, and that TWT is able to
produce, so that TWAgbio receives at least its proportional share of available
supplies as determined based on reasonable forecasts (taking into consideration
past sales and sales performance against forecast) of TWAgbio, TWT and other
third parties.

            7.2.9 Right to Manufacture. Provided that TWAgbio has paid all
amounts invoiced in accordance with Section 8.1 when due, if for any two (2)
rolling calendar month period or for any three (3) rolling calendar month period
TWT fails to supply eighty percent (80%) or ninety percent (90%), respectively,
of TWT TWAgbio's requirements of a particular Finished Product or Cleavase
Enzyme ordered in accordance with Sections 7.2.2 and 7.2.3 above, and provided
that such failure will or does result in a substantial interruption of supply of
a Finished Product to the commercial market and is not due to action or inaction
of TWAgbio, then TWAgbio may manufacture or have manufactured pursuant to this
Section 7.2.9 such Finished Product for use in the Field or such Cleavase Enzyme
for purposes of manufacturing or having manufactured Products for use in the
Field, in either case that TWT failed to supply.

            7.2.10 Exclusive Remedies. SECTIONS 7.2.8, 7.2.9 AND 11.2 ABOVE ARE
TWAGBIO'S SOLE AND EXCLUSIVE REMEDY FOR A FAILURE BY TWT TO SUPPLY QUANTITIES OF
PROBE SETS, FINISHED PRODUCT OR CLEAVASE ENZYME PURSUANT TO THIS SECTION 7.2.

        7.3 Probe Sets. Without limiting the provisions of Section 7.2 above,
TWT acknowledges that TWAgbio may manufacture or have manufactured Probe Sets
for use with SIRPs supplied hereunder; provided that TWT shall have the right to
perform quality control on such Probe Sets and/or qualify the manufacturer, to
the extent reasonably necessary to ensure the quality of such Probe Sets. In the
event that TWT performs such quality control or qualifies such manufacturer, TWT
shall have the right to include the direct and indirect costs incurred by TWT
with respect thereto in the Development Costs hereunder and such costs shall not
be subject to the limitations set forth in Section 6.3 above

                                    ARTICLE 8
                           PAYMENTS; BOOKS AND RECORDS

        8.1 Payment Terms and Method. Unless otherwise specified herein, all
payments hereunder shall be due and payable thirty (30) days after the invoice
date thereof. All payments under this Agreement shall be made by bank wire
transfer in immediately available funds to an account designated by TWT or such
other method as mutually agreed from time to time. All dollar amounts specified
in this Agreement, and all payments made hereunder, are and shall be made in
U.S. dollars. Any payments due under this Agreement which are not paid by the
date such payments are due under this Agreement shall bear interest to the
extent permitted by applicable law at the U.S. prime rate per annum quoted in
the "Money Rates" column of The Wall Street Journal (U.S., Central Edition) on
the first business day after such payment is due, plus an additional four
percent (4%) per annum, calculated on the number of days such payment is
delinquent. This Section 8.1 shall in no way limit any other remedies available
to either party.

                                      -16-
<PAGE>   17

        8.2 Taxes. All payments by TWAgbio specified hereunder are expressed as
net amounts and shall be made free and clear of, and without reduction for, any
taxes. Any such taxes which are otherwise imposed on payments to TWT shall be
the sole responsibility of TWAgbio. TWAgbio shall provide TWT with official
receipts issued by the appropriate taxing authority or such other evidence as is
reasonably requested by TWT to establish that such taxes have been paid. If TWT
uses a tax credit received by TWT as a result of the payment of taxes by TWAgbio
and thereby reduces the amount of U.S. income tax that TWT otherwise would have
paid, TWT shall refund to TWAgbio the amount of such reduction with respect to
such tax credit. Likewise, if TWT has the legal obligation to collect and/or pay
any sales, use, excise or value added taxes, the appropriate amount shall be
added to TWAgbio's invoice and paid by TWAgbio, unless TWAgbio provides TWT with
a valid tax exemption certificate authorized by the appropriate taxing
authority.

        8.3 Records. TWT shall keep complete, true and accurate books of
accounts and records for the purpose of determining the amounts payable pursuant
to this Agreement. Such books and records shall be kept for at least three (3)
years following the end of the calendar quarter to which they pertain. Such
records will be open for inspection at TWT's principal place of business during
such three (3)-year period by an independent auditor chosen by TWAgbio and
reasonably acceptable to TWT for the purpose of verifying the amounts payable by
TWAgbio hereunder. Such inspections may be made no more than once each calendar
year, at reasonable times and on reasonable notice. The independent auditor
shall be obligated to execute a reasonable confidentiality agreement prior to
commencing any such inspection. Inspections conducted under this Section 8.3
shall be at the expense of TWAgbio, unless a variation or error producing an
overpayment in amounts payable exceeding ten percent (10%) of the amount paid
for the period covered by the inspection is established in the course of any
such inspection, whereupon all costs relating to the inspection for such period,
and in all events any overpaid amounts that are discovered shall be paid by TWT,
together with interest on such overpaid amounts at the rate set forth in Section
8.1 above. The parties will endeavor to minimize disruption of TWT's normal
business activities to the extent reasonably practicable.

                                    ARTICLE 9
                                    LICENSES

        9.1 Grant to TWAgbio.

            9.1.1 General. Subject to the terms and conditions of this Agreement
including Article 7 above, TWT hereby grants to TWAgbio an exclusive, fully
paid-up, royalty-free license under the TWT Technology to: (i) develop, use,
sell, import, export or otherwise distribute Products, (ii) manufacture, have
manufactured or otherwise produce Products, (iii) manufacture, have manufactured
or otherwise produce Cleavase Enzyme solely for purposes of (ii), (iv) practice
any method, process or procedure, and (v) otherwise exploit the TWT Technology;
and to have any of the foregoing performed on its behalf by a third party, in
each case solely within the Field. Notwithstanding anything herein to the
contrary, TWAgbio shall not sell or otherwise transfer any Cleavase Enzyme
except as part of a Finished Product unless otherwise agreed by TWT in writing.

                                      -17-
<PAGE>   18

            9.1.2 Restrictions. TWAgbio agrees not to market, promote or
distribute, directly or indirectly, any Product for use outside the Field; and
TWT agrees to include or cause to be included a label license on the packaging
for any and all Products sold or otherwise distributed by or under authority of
TWAgbio which includes the language "FOR USE SOLELY FOR AGRICULTURAL
APPLICATIONS" and additionally include on the package insert the following:
"Agricultural Applications do not include applications related to: (i) the
discovery, production or development of products, processes or methods for
diagnostic or therapeutic applications in humans, including the discovery,
development, use and raising of animal models of human disease and all other
applications related to human health; or (ii) processed food materials for
bacterial and viral pathogens," in each case such language shall be reasonably
positioned and sized to be seen by the user of such Products. TWAgbio further
agrees not to provide Products to any third party if TWAgbio knows or has reason
to believe that Products provided to such third party have been promoted or sold
for use or used outside the Field. Without limiting the foregoing and
notwithstanding anything herein to the contrary, TWAgbio shall not sell or
otherwise transfer any General Application Product, or authorize any third party
to do so, except pursuant to a written agreement under which the recipient
agrees to use such General Application Product solely for applications in the
Field. Without limiting the foregoing, TWAgbio agrees that in the event that it
sells or transfers such General Application Product, directly or through a third
party, that it shall use diligent efforts to ensure that the same are used
solely for applications in the Field. For purposes of the foregoing, "General
Application Product" shall mean any Product which has application outside of the
Field.

        9.2 Grant to TWT.

            9.2.1 General. Subject to the terms and conditions of this
Agreement, TWAgbio hereby grants to TWT an exclusive, fully paid-up,
royalty-free license under the TWAgbio Technology to: (i) develop, manufacture,
use, sell, import, export or otherwise distribute TWT Products, (ii) practice
any method, process or procedure, and (iii) otherwise exploit the TWAgbio
Technology; and to have any of the foregoing performed on its behalf by a third
party, in each case solely within the TWT Field.

            9.2.2 Restrictions. TWT agrees not to market, promote or distribute,
directly or indirectly, any TWT Product for use outside the TWT Field; and TWT
agrees to include or cause to be included a label license on the packaging for
any and all TWT Products sold or otherwise distributed by or under authority of
TWT which includes the language "NOT FOR USE IN AGRICULTURAL APPLICATIONS," in
each case such language shall be reasonably positioned and sized to be seen by
the user of such TWT Products. TWT further agrees not to provide TWT Products to
any third party if TWT knows or has reason to believe that TWT Products provided
to such third party have been promoted or sold for use or used outside the TWT
Field.

        9.3 Sublicenses. The licenses granted under Sections 9.1 and 9.2 above
shall include the right to grant and authorize sublicenses to the extent
necessary or useful for exercising such licenses, subject in each case to the
restrictions relating to such license herein.

                                      -18-
<PAGE>   19

        9.4 Retained Rights. Notwithstanding the licenses granted to TWAgbio
pursuant to Section 9.1 above, TWT shall retain a non-exclusive license under
the TWT Technology within the Field for purposes of conducting or having
conducted the Development Program and manufacturing or having manufactured
Products and Cleavase Enzyme for supply to or on behalf of TWAgbio for use in
the Field.

        9.5 Manufacturing Licenses.

            9.5.1 Restrictions. TWAgbio covenants not to exercise any of its
licenses to manufacture or have manufactured Products or Cleavase Enzymes
granted by TWT pursuant to Section 9.1 above except to the extent expressly
permitted in Article 7 above. In such event, TWT shall provide to TWAgbio copies
of all documentation within TWT's control that is reasonably necessary for
TWAgbio to manufacture or have manufactured such Products or Cleavase Enzyme, as
applicable, and shall reasonably cooperate with TWAgbio to establish supply
thereof, including sources of materials. In addition in the event that TWAgbio
has the right to manufacture Cleavase Enzymes hereunder, TWT shall provide
TWAgbio with reasonable quantities of applicable plasmids containing the
appropriate DNA for such Cleavase Enzymes for use by TWAgbio for manufacturing
such Cleavase Enzymes; provided, however, in no case shall TWAgbio transfer such
plasmids to any third party without TWT's prior written consent. TWAgbio's right
to have Cleavase Enzymes manufactured or sublicense of such right shall in all
cases be subject to TWT's approval, which approval shall not be unreasonably
withheld or delayed. Without limiting the foregoing, in the event that TWAgbio
has any Product or Cleavase Enzyme manufactured by a third party, such third
party shall enter into a confidentiality agreement with TWT to protect against
the unauthorized use and disclosure of TWT's Confidential Information.

            9.5.2 Option to Manufacture. To the extent that TWAgbio intends to
have Finished Products or Cleavase Enzyme manufactured by a third party in
accordance with this Agreement, TWAgbio shall first notify TWT in writing of its
intent to do so and, at TWT's request, negotiate with TWT the possibility of a
right for TWT to supply the same. The foregoing sentence shall not apply to
TWAgbio's exercise of its right to have Finished Products or Cleavase Enzyme
manufactured pursuant to Section 7.2.9 as a result of TWT's failure to supply
quantities ordered by TWAgbio in accordance with Article 7 above.

        9.6 Reservations. Nothing in this Agreement shall be deemed to restrict
TWT's right to exploit any TWT Technology in products or applications outside
the Field. Likewise, nothing in this Agreement shall be deemed to restrict
TWAgbio's right to exploit any TWAgbio Technology in products or applications
outside of the TWT Field. Furthermore, nothing in this Agreement shall be deemed
to prevent or restrict TWT from developing, manufacturing, using or selling
research kits or reagents with general application (e.g., CFLP(R), Invader or
other kits without target specific probes) or authorizing third parties to do
the same. Without limiting the foregoing, it is acknowledged and agreed that
such research kits and reagents with general application may have application
within the Field, but in no case shall such reagents or kits be configured for
application solely within the Field.

                                      -19-
<PAGE>   20

        9.7 Trademarks/Tradenames.

            9.7.1 Third Wave Agbio. TWT hereby assigns to TWAgbio all right,
title and interest in and to the trade names "Third Wave Agbio" and "Third Wave
Agbio, Inc."

            9.7.2 Third Wave. TWT and TWAgbio agree that TWT shall have the sole
right to use and authorize others to use the trade name "Third Wave."

            9.7.3 TWT Trademarks.

                (a) Right. Subject to the terms and conditions herein, including
this Section 9.7.3 below, and in addition to the rights granted to TWAgbio in
Section 9.1 above, TWT hereby grants to TWAgbio a fully paid-up, royalty-free
right to use the TWT Trademarks solely for use in connection with the marketing,
promotion or other commercialization activities related to Products for
application in the Field as contemplated by this Agreement.

                (b) Display/Use. All packaging materials, labels and promotional
materials for the Products shall display the applicable TWT Trademark(s).
TWAgbio shall comply with reasonable written guidelines with respect to the use
of the TWT Trademarks provided by TWT from time to time, including reasonable
approval rights.

                (c) Ownership. Except as set forth in this Section 9.7.3,
nothing contained in this Agreement shall grant to TWAgbio any right, title or
interest in or to TWT Trademarks whether or not specifically recognized or
perfected under applicable laws, and TWAgbio irrevocably assigns to TWT all such
right, title and interest, if any, in any TWT Trademarks. Without limiting the
foregoing, the ownership and all goodwill from the use of the TWT Trademarks
shall vest in and inure to the benefit of TWT. At no time during or after the
term of this Agreement shall TWAgbio challenge or assist others to challenge the
TWT Trademarks or the registration thereof or attempt to register any
trademarks, marks or trade names confusingly similar to the TWT Trademarks.

                (d) Recordation. TWAgbio shall pay for recordation of the
license to the TWT Trademarks in those jurisdictions where recordation is
required.

        9.8 Design Software.

            9.8.1 Use License. During the Term of the Development Program,
subject to the terms and conditions of this Agreement, TWT hereby grants to
TWAgbio a fully paid-up, non-exclusive, nontransferable license to use the
Design Software for designing Probe Sets for use with SIRPs hereunder and
performing certain quality control activities with respect to such Probe Sets.
Such license shall be limited to use of the Design Software as it exists on the
site to be specified by TWT, without access to the source code or object code
forms of the Design Software, except as set forth in Section 9.8.2 below.
TWAgbio may allow such right to its customers ("End Users") provided that each
such End User enters into an End User License with TWT substantially similar to
that between TWT and its own customers. Without limiting the foregoing, during
the Term of the

                                      -20-
<PAGE>   21

Development Program, TWAgbio shall use, and shall cause its customers to use,
the Design Software for purposes of designing and quality controlling Probe
Sets.

                (a) General. Such license may be exercised via accessing a site
on the World Wide Web, to be specified by TWT, using commonly available Internet
browser software and in accordance with reasonable procedures established by TWT
from time to time for its own customers, which will include (without limitation)
password-protected and ip-limited access. TWT shall use reasonable efforts to
ensure that only those of its and End Users' employees and contractors who need
to have access to the Design Software have access to the passwords therefor. TWT
shall make available to TWAgbio and its End Users, upgrades and updates to the
Design Software as the same become available to TWT's own customers. TWT shall
use commercially reasonable efforts to provide availability of the Design
Software to TWAgbio and its End Users at the same level of reliability as TWT
provides to its own customers.

                (b) Restrictions. TWAgbio may use the Design Software only for
purposes within the Field. TWAgbio may not at any time attempt to disable or
attempt to circumvent any security measures implemented by TWT except as
explicitly authorized, or otherwise interfere with the operation of the Design
Software.

            9.8.2 Code License. From time to time during the Term of the
Development Program upon TWAgbio's reasonable written notice to TWT and
TWAgbio's expense, TWT will deliver to TWAgbio a copy of each of the source code
and/or object code of the Design Software, as requested, as the same exists as
of the time of the request on a media to be mutually agreed to by the parties in
writing. In connection with such delivery, TWT will grant TWAgbio a worldwide,
royalty-free, perpetual, non-exclusive license to use, copy, modify and create
derivative works of the source code and object code of the Design Software
solely for purposes of applications within the Field. Accordingly, TWAgbio shall
use reasonable efforts to ensure that any third party accessing the Design
Software or any derivative software developed therefrom under authority of
TWAgbio use the same solely for applications in the Field. After any delivery of
such copy of source code and/or object code, TWT shall not have any obligation
to provide updates or upgrades thereto or to perform any maintenance or support
to such copy, except as may be otherwise agreed to by the parties in writing.

            9.8.3 Other Rights.

                (a) Title to Design Software. As between the parties, title to
and ownership of the Design Software, all proprietary rights therein, any
accompanying printed materials and all copies and portions thereof shall be and
at all times remain in TWT. Without limiting the provisions of Section 9.2
above; however, TWT disclaims any ownership of reports or designs resulting from
application by TWAgbio and its End Users of the Design Software within the
Field, as intended.

                (b) Derivative Works. Under the license to be granted pursuant
to Section 9.8.2 above, TWT shall not have title or ownership to Derivative
Works created by TWAgbio after the Term of the Development Program. Likewise,
TWAgbio shall not have any rights to Derivative Works created by TWT after the
Term of the Development Program. For

                                      -21-
<PAGE>   22

purposes of this Agreement, a "Derivative Work" is a revision, modification,
translation, abridgment, compilation, condensation or expansion of the Design
Software or any form in which the Design Software may be recast, transformed, or
adapted, and which, if prepared without the consent of TWT, would constitute a
copyright infringement.

        9.9 No Implied Licenses. Nothing herein shall be construed as granting
to either party, by implication, estoppel or otherwise, any license or other
right to any intellectual property of the other party other than those expressly
granted herein.

        9.10 Third Party Payments.

            9.10.1 Generally. Each party (for purposes of this Section 9.10, the
"Reimbursing Party") shall promptly reimburse the other party hereto for any
amounts payable by such other party to third parties pursuant to a Third Party
Agreement (including agreements entered into as set forth in Section 9.10.2
below), including any royalties, license fees, milestone, or other payments due
to such third parties, which in each case become due as a result of the exercise
by or under authority of the Reimbursing Party in accordance with this Agreement
of the licenses granted to such Reimbursing Party under Section 9.1 or 9.2, as
applicable. The foregoing shall only apply to amounts payable by TWAgbio only to
the extent such amounts are not included within the definition of Development
Costs hereunder.

            9.10.2 Future Agreements. It is understood and agreed TWT or TWAgbio
may choose to license or otherwise acquire technology from third parties which
would be subject to the licenses granted hereunder, but neither party has any
obligation to do so. In the event that TWT or TWAgbio (the "Acquiring Party")
proposes to acquire such technology (the "Acquired Technology"), the Acquiring
Party shall disclose the same to the other party, including any royalty or other
payment obligations that would apply to the exercise of the other party's
license hereunder. The other party shall notify the Acquiring Party in writing
within fifteen (15) days whether it desires such Acquired Technology to be
included in licenses granted hereunder, if the other party so desires the
Acquired Technology shall be included in the Acquiring Party's Technology (i.e.,
the TWAgbio Technology or TWT Technology, as appropriate) and if the other party
fails to notify the Acquiring Party or notifies that it does not desire a
license to such Acquired Technology, then the Acquired Technology shall be
excluded from the Acquiring Party's Technology (i.e., the TWAgbio Technology or
TWT Technology, as appropriate) and the other party shall not have a license
thereto hereunder. The agreement under which the Acquiring Party acquires
Acquired Technology included within the Acquiring Party's Technology as set
forth above shall be a "Third Party Agreement" for purposes of this Agreement.
Without limiting the foregoing, it is understood and agreed that to the extent a
Third Party Agreement requires that particular provisions be incorporated in a
license or sublicense, as the case may be, granted thereunder such provisions
shall be deemed to be incorporated herein by reference with respect to the
subject matter covered thereby.

            9.10.3 Payment; Reports. If a party is obligated to pay amounts to a
third party pursuant to a Third Party Agreement subject to reimbursement
pursuant to Section 9.10.1 above, such party shall notify the Reimbursing Party
reasonably in advance, and the Reimbursing Party

                                      -22-
<PAGE>   23

shall reimburse the other party for its share of such payments by the later of
(i) ten (10) days before such amounts are payable to such third party or (ii)
thirty (30) days after receipt of notice therefor. In addition, to the extent
that a party is obligated to provide reports to a third party pursuant to a
Third Party Agreement as a result of or reporting on the status of activities of
the other party hereunder, the other party hereto shall reasonably assist the
reporting party by providing information in its possession or control and in
sufficient detail to complete and submit such reports as required.

                                   ARTICLE 10
              OWNERSHIP OF INTELLECTUAL PROPERTY AND PATENT RIGHTS

        10.1 Ownership of Inventions. Title to all inventions and other
intellectual property made solely by TWAgbio personnel during the Term of the
Development Program shall be owned by TWAgbio. Title to all inventions and other
intellectual property made solely by TWT personnel during the Term of the
Development Program shall be owned by TWT. Title to all inventions and other
intellectual property made jointly by personnel of TWAgbio and TWT during the
Term of the Development Program shall be jointly owned by TWAgbio and TWT.
Without limiting the foregoing, in the event that any invention or other
intellectual property has no application in the TWT Field or has no application
in the Field of Agriculture the parties will discuss the possibility of
assigning to the appropriate party hereto the entire title to such intellectual
property, to the extent that such assignment is reasonably practicable taking
into consideration prior art and other related considerations. Subject to the
rights and licenses granted herein, it is understood that neither party shall
have any obligation to account to the other party for profits, or to obtain any
approval of the other party to license or exploit a joint invention, by reason
of joint ownership of any invention or other intellectual property, and each
party hereby irrevocably waives any such right it may have under applicable laws
in any country.

        10.2 Patent Prosecution.

            10.2.1 Sole Inventions. TWT or TWAgbio, as the case may be (for
purposes of this Section 10.2.1, the "Controlling Party") shall have the right
to control the Prosecution and Maintenance Activities pertaining to solely owned
patent applications and patents within the Controlling Party's Patents (i.e.,
the TWT Patents or the TWAgbio Patents, as applicable), in each case worldwide
using counsel of its choice and in such countries as the Controlling Party deems
appropriate; and the other party hereto agrees to reimburse the Controlling
Party within thirty (30) days of receipt of invoice therefor a reasonable share
(as determined by the parties based on application in the Field or TWT Field,
respectively, but in no event less than twenty percent (20%)) of the costs
incurred by the Controlling Party with respect to such Prosecution and
Maintenance Activities. Notwithstanding the foregoing, if the non-Controlling
Party no longer desires to bear such costs with respect to any such patent or
patent application it may provide the Controlling Party at least thirty (30)
days prior written notice and such patent or patent application shall be
excluded from the Controlling Party's Patents (i.e., the TWT Patents or the
TWAgbio Patents, as applicable) for all purposes and the non-Controlling Party
shall thereafter have no license thereunder. For purposes of this Section 10.2,
"Prosecution and Maintenance Activities" shall mean the preparing,

                                      -23-
<PAGE>   24

filing, prosecuting and maintaining of patent applications and patents and
re-examinations, reissues and requests for patent term extensions therefor,
together with the conduct of any interference, opposition or other similar
proceeding pertaining to patent applications or patents. Notwithstanding the
foregoing, if the Controlling Party no longer desires to assume control of the
Prosecution and Maintenance Activities, the Controlling Party shall provide the
non-Controlling Party at least thirty (30) days prior written notice and if the
non-Controlling Party desires, the non-Controlling Party may assume control of
such Prosecution and Maintenance Activities, at its sole expense, in the
Controlling Party's name or as otherwise mutually agreed.

            10.2.2 Joint Inventions. TWT shall have the initial right to control
the Prosecution and Maintenance Activities pertaining to patents and patent
applications claiming inventions that are jointly owned by TWT and TWAgbio and
each party shall be responsible for one-half (1/2) of the out-of-pocket expenses
incurred in connection with such activities. Notwithstanding the foregoing, if
either party (for purposes of this Section 10.2.2, the "Notifying Party")
notifies the other party in writing that it no longer desires to pay for such
expenses with respect to any such jointly-owned patent application or patent,
the Notifying Party shall assign all right, title and interest in and to such
patent application or patent (as the case may be) and any patents issuing
thereon (subject to the rights and licenses granted hereunder) to the other
party; in such event, the Notifying Party shall not be responsible for expenses
incurred under this Section 10.2.2 with respect to such patent application or
patent beginning sixty (60) days after giving the foregoing notice. For
avoidance of doubt, the foregoing sentence shall not relieve the Notifying Party
of any obligation under Section 10.2.1 above.

            10.2.3 Cooperation. Each of TWT and TWAgbio shall keep the other
reasonably informed as to the status of patent matters pertaining to the TWT
Patents and TWAgbio Patents, respectively, including providing to the other
party copies of any significant documents that such party receives from or send
to patent offices, such as notices of interferences, re-examinations,
oppositions or requests for patent term extensions, all as reasonably requested
by the other party. TWT and TWAgbio shall each cooperate with and assist the
other in connection with such activities, at the other party's request and
expense, and shall use good faith efforts to consult with each other regarding
the prosecution and maintenance of the TWAgbio Patents and TWT Patents as is
reasonably appropriate.

        10.3 Enforcement. If either party reasonably believes that any TWAgbio
Technology or TWT Technology is infringed or misappropriated by a third party or
is subject to a declaratory judgment action arising from such infringement, such
party shall promptly notify the other party. In such case TWAgbio shall have the
initial right (but not the obligation) to enjoin such misappropriation, to
enforce the TWAgbio Patents with respect to such infringement, or to defend any
declaratory judgment with respect to the TWAgbio Technology; likewise, TWT shall
have the initial right (but not the obligation) to enjoin such misappropriation,
to enforce the TWT Patents with respect to such infringement, or to defend any
declaratory judgment with respect to the TWT Technology (for purposes of this
Section 10.3, any such action is herein after referred to as an "Enforcement
Action").

                                      -24-
<PAGE>   25

            10.3.1 Initiating Enforcement Actions. In the event that TWAgbio
fails to initiate an Enforcement Action to protect TWAgbio Technical Information
or to enforce the TWAgbio Patents against a commercially significant
infringement by a third party, which infringement or misappropriation consists
of the manufacture, sale or use of a product in the TWT Field, within one
hundred twenty (120) days of a request by TWT to initiate such Enforcement
Action, TWT may initiate an Enforcement Action against such infringement with
TWAgbio's prior written approval, which approval shall not be unreasonably
withheld or delayed. Correspondingly, in the event that TWT fails to initiate an
Enforcement Action to protect TWT Technical Information or to enforce the TWT
Patents against a commercially significant infringement by a third party, which
infringement or misappropriation consists of the manufacture, sale or use of a
product in the Field of Agriculture, within one hundred twenty (120) days of a
request by TWAgbio to initiate such Enforcement Action, TWAgbio may initiate an
Enforcement Action against such infringement with TWT's prior written approval,
which approval shall not be unreasonably withheld or delayed.

            10.3.2 Cooperation. The party controlling any such Enforcement
Action (for purposes of Sections 10.3.2 and 10.3.4, the "Controlling Party")
shall keep the other party hereto reasonably informed of the progress of any
such Enforcement Action, and such other party shall have the right to
participate, at its own expense, with counsel of its own choice. In addition,
such other party shall reasonably cooperate in such Enforcement Action, at the
Controlling Party's expense, including without limitation by joining as a
party-plaintiff where necessary to maintain such Enforcement Action, provided
that the Controlling Party indemnifies such other party against any liability
arising therefrom.

            10.3.3 No Implied Obligations. Except as expressly provided in this
Section 10.3 above, neither party has any obligation to bring or prosecute
actions or suits against any third party for patent infringement.

            10.3.4 Recoveries. Under all circumstances, the parties shall share
recoveries from Enforcement Actions, net of costs and expenses of the
Controlling Party, as follows: (i) to the extent that the recoveries represent
infringing activities within the Field of Agriculture, one hundred percent
(100%) to TWAgbio, (ii) to the extent that the recoveries represent infringing
activities within the TWT Field, one hundred percent (100%) to TWT and (iii) any
remainder shall be retained by the Controlling Party.

        10.4 Patent Defense. If a claim, suit or proceeding (any for purposes of
this Section 10.4, an "Action") is brought against TWAgbio or TWT (the "Subject
Party") or its Affiliates or a third party acting under authority of such party
alleging patent infringement and such Action is directed to the subject of a
patent or patent application within the Patents of the other party (i.e., the
TWAgbio Patents or TWT Patents, as applicable) the Subject Party shall promptly
notify the other party. As between the parties to this Agreement, the Subject
Party shall be entitled to control the defense in any such Action(s); provided
that the other party shall have the right to participate in the defense or
settlement thereof, at its own expense, with counsel of its own choosing. Except
as agreed in writing by the other party, the Subject Party shall not enter into
any settlement of an Action, if such settlement admits the unpatentability,
invalidity or unenforceability of any Patent of the other party

                                      -25-
<PAGE>   26

(i.e., the TWAgbio Patents or TWT Patents, as applicable). The Subject Party
agrees to keep the other party hereto reasonably informed of all material
developments in connection with any Action.

        10.5 Third Party Rights. The foregoing provisions of this Article 10
shall be subject to and limited by Third Party Agreements pursuant to which
TWAgbio and TWT, as the case may be, acquired any particular TWAgbio Technology
or TWT Technology.

                                   ARTICLE 11
                         REPRESENTATIONS AND WARRANTIES

        11.1 General.

            11.1.1 TWT Warranties. TWT hereby represents, warrants and covenants
to TWAgbio that (i) it has the full right and authority to enter into this
Agreement and grant the rights and licenses granted herein; (ii) it has not
previously granted and will not grant any rights in conflict with the rights and
licenses granted herein; and (iii) it has not previously granted, and will not
grant during the term of this Agreement, any right, license or interest in or to
the TWT Technology in the Field, or any portion thereof, that is in conflict
with the rights or licenses granted under this Agreement; and (iv) to TWT's
knowledge and belief, there are no existing or threatened actions, suits or
claims pending against it with respect to its right to enter into and perform
its obligations under this Agreement; and (v) Exhibit 1.28 is a complete and
accurate list of all agreements between TWT and third parties pertaining to the
Field that are in existence as of the Effective Date.

            11.1.2 TWAgbio Warranties. TWAgbio hereby represents, warrants and
covenants to TWT that (i) it has the full right and authority to enter into this
Agreement and grant the rights and licenses granted herein; (ii) it has not
previously granted and will not grant any rights in conflict with the rights and
licenses granted herein; and (iii) it has not previously granted, and will not
grant during the term of this Agreement, any right, license or interest in or to
the TWAgbio Technology in the TWT Field, or any portion thereof, that is in
conflict with the rights or licenses granted under this Agreement; and (iv) to
TWAgbio's knowledge and belief, there are no existing or threatened actions,
suits or claims pending against it with respect to its right to enter into and
perform its obligations under this Agreement.

        11.2 Certain Warranties and Covenants Regarding Products. TWT represents
and warrants that all Products supplied to or on behalf of TWAgbio under this
Agreement will comply with all applicable Specifications at the time of
shipment. TWAgbio shall, or cause its customers to, promptly upon receipt of
each shipment perform customary inspection. Any claim regarding the failure of
such shipment to conform to the applicable Specifications shall be submitted to
TWT promptly upon discovery together with reasonable evidence of such
nonconformity at the time of inspection. In the event that TWAgbio and TWT agree
(or there is an independent finding) that any Product failed to comply with such
Specifications at the time of shipment, TWT shall, at TWT's own cost (including
freight and insurance) deliver replacement quantities of such Product as soon as
practicable. TWT may analyze any unit of Product rejected for nonconformity. In
case of a disagreement between the parties, the claim shall be submitted for
tests and decision to an

                                      -26-
<PAGE>   27

independent testing organization, which meets appropriate industry standards and
mutually agreed upon by the parties (the "Laboratory"), the appointment of which
shall not be unreasonably withheld or delayed by either party. The determination
of such entity with respect to all or part of any shipment of Products shall be
final and binding upon the parties. The fees and expenses of the Laboratory
making such determination shall be paid by the party against which the
determination is made. TWT shall give TWAgbio or its customers, as applicable,
written instructions as to how it should, at TWT's expense, dispose of any
non-conforming Products, and such instructions shall comply with all appropriate
governmental requirements.

        11.3 Disclaimer of Warranties. EXCEPT AS EXPRESSLY SET FORTH IN THIS
ARTICLE 11, TWT AND TWAGBIO EXPRESSLY DISCLAIM ANY WARRANTIES OR CONDITIONS,
EXPRESS, IMPLIED, STATUTORY OR OTHERWISE, WITH RESPECT TO THE SUPPLY AND
DEVELOPMENT OF PRODUCTS, THE PRODUCTS THEMSELVES, TWT TECHNOLOGY AND TWAGBIO
TECHNOLOGY, INCLUDING, WITHOUT LIMITATION, ANY WARRANTY OF MERCHANTABILITY, OR
FITNESS FOR A PARTICULAR PURPOSE, VALIDITY OF THE TWT TECHNOLOGY OR TWAGBIO
TECHNOLOGY, PATENTED OR UNPATENTED, AND NON-INFRINGEMENT OF THE INTELLECTUAL
PROPERTY RIGHTS OF THIRD PARTIES.

                                   ARTICLE 12
                                 CONFIDENTIALITY

        12.1 Confidential Information. Except as expressly provided herein, the
parties agree that, for the term of this Agreement and for seven (7) years
thereafter, the receiving party shall not publish or otherwise disclose and
shall not use for any purpose any information furnished to it by the other party
hereto pursuant to this Agreement which the receiving party should reasonably
have known is of a proprietary or confidential nature to the disclosing party
(collectively, "Confidential Information"). It being understood and agreed that
Confidential Information shall include such information that was disclosed prior
to the Effective Date. Notwithstanding the foregoing, it is understood and
agreed that Confidential Information shall not include information that, in each
case as demonstrated by written documentation:

            12.1.1 was generally available to the public or otherwise part of
the public domain at the time of its disclosure to the receiving party;

            12.1.2 became generally available to the public or otherwise part of
the public domain after its disclosure and other than through any act or
omission of the receiving party in breach of this Agreement; or

            12.1.3 was subsequently disclosed to the receiving party by a person
other than a party hereto without obligation of confidentiality; or

            12.1.4 is developed by the receiving party without reference to any
information or materials disclosed by the disclosing party.

                                      -27-
<PAGE>   28

        12.2 Permitted Disclosures. Notwithstanding the provisions of Section
12.1 above, each party hereto may use and disclose the other party's
Confidential Information to the extent such use and disclosure is reasonably
necessary, in filing or prosecuting patent applications, prosecuting or
defending litigation, complying with applicable governmental regulations,
submitting information to tax or other governmental authorities, or conducting
clinical trials or in exercising its rights hereunder (including granting any
permitted sublicenses), provided that if a party is legally required to make any
such disclosure of the other party's Confidential Information, to the extent it
may legally do so, it will give reasonable advance written notice to the latter
party of such disclosure and, save to the extent inappropriate in the case of
patent applications, will use its reasonable efforts to secure confidential
treatment of such Confidential Information prior to its disclosure (whether
through protective orders or otherwise). Without limiting the foregoing, it is
understood and agreed that each party may disclose the other party's
Confidential Information to its respective employees, consultants and officers
who require access thereto for purposes of carrying out the terms and conditions
of this Agreement, provided that such persons have entered into written
confidentiality agreements subject to normal and customary non-use and
non-disclosure terms and conditions.

                                   ARTICLE 13
                                 INDEMNIFICATION

        13.1 Insurance. Each party shall secure and maintain in effect during
the term of this Agreement and for a period of five (5) years thereafter
insurance policy(ies) underwritten by a reputable insurance company and in a
form and having limits standard and customary for entities in the biotechnology
industry for exposures related to the indemnification obligations of such party
pursuant to this Article 13 below. Such insurance shall include general
liability and products liability coverage with respect to such party's
development and commercialization of Products or TWT Products, as applicable and
shall name the TWT Indemnitees or TWAgbio Indemnitees (each as defined below) as
additional insureds thereunder, as appropriate. Upon request by the other party
hereto, certificates of insurance evidencing the coverage required above shall
be provided to the other party.

        13.2 Indemnification of TWAgbio. TWT shall indemnify each of TWAgbio and
its directors, officers and employees and the successors and assigns of the
foregoing (collectively, the "TWAgbio Indemnitees"), and hold each TWAgbio
Indemnitee harmless from and against any and all liabilities, damages,
settlements, claims, actions, suits, penalties, fines, costs or expenses
(including, without limitation, reasonable attorneys' fees and other expenses of
litigation) incurred by any TWAgbio Indemnitee arising from or occurring as a
result any claim, action, suit, or other proceeding brought by third parties
against a TWAgbio Indemnitee arising from or occurring as a result of (i) the
exercise of the rights granted to TWT under Section 9.2 including without
limitation, product liability claims relating to any TWT Products used, sold or
otherwise distributed by or under authority of TWT or its Affiliates or (ii) the
gross negligence or willful tortious misconduct of a TWT Indemnitee.
Notwithstanding the foregoing, TWT shall have no obligation under this Section
13.2 with respect to liabilities, damages, settlements, claims, actions, suits,
penalties, fines, costs or

                                      -28-
<PAGE>   29

expenses to the extent the same is caused by the gross negligence or willful
tortious misconduct of a TWAgbio Indemnitee.

        13.3 Indemnification of TWT. TWAgbio shall indemnify each of TWT and its
directors, officers and employees and the successors and assigns of the
foregoing (collectively, the "TWT Indemnitees"), and hold each TWT Indemnitee
harmless from and against any and all liabilities, damages, settlements, claims,
actions, suits, penalties, fines, costs or expenses (including, without
limitation, reasonable attorneys' fees and other expenses of litigation)
incurred by any TWT Indemnitee arising from or occurring as a result any claim,
action, suit, or other proceeding brought by third parties against a TWT
Indemnitee arising from or occurring as a result of (i) the exercise of the
rights granted to TWAgbio under Section 9.1 or 9.8 including without limitation,
product liability claims relating to any Products used, sold or otherwise
distributed by or under authority of TWAgbio or its Affiliates or (ii) TWT's
performance of its responsibilities with respect to the Development Program,
Services or the manufacture and supply of Products or Cleavase Enzyme to TWAgbio
hereunder or (iii) the gross negligence or willful tortious misconduct of a
TWAgbio Indemnitee. Notwithstanding the foregoing, TWAgbio shall have no
obligation under this Section 13.3 with respect to liabilities, damages,
settlements, claims, actions, suits, penalties, fines, costs or expenses to the
extent the same is caused by the gross negligence or willful tortious misconduct
of a TWT Indemnitee.

        13.4 Procedure. A party (for purposes of this Section 13.4, the
"Indemnitee") that intends to claim indemnification under any provision of this
Agreement shall: (i) promptly notify the indemnifying party (the "Indemnitor")
in writing of any claim, action, suit, or other proceeding brought by third
parties in respect of which the Indemnitee or any of its directors, officers,
employees, successors or assigns intend to claim such indemnification hereunder;
(ii) provide the Indemnitor sole control of the defense and/or settlement
thereof, and (iii) provide the Indemnitor, at the Indemnitor's request and
expense, with reasonable assistance and full information with respect thereto.
Notwithstanding the foregoing, the indemnity obligation in this Article 13 shall
not apply to amounts paid in settlement of any loss, claim, damage, liability or
action if such settlement is effected without the consent of the Indemnitor, to
the extent such consent is not withheld unreasonably or delayed. Without
limiting the foregoing provisions of this Section 13.4, the Indemnitor shall
keep the Indemnitee reasonably informed of the progress of any claim, suit or
proceeding under this Section 13.4 and the Indemnitee shall have the right to
participate in any such claim, suit or proceeding with counsel of its choosing
at its own expense.

                                   ARTICLE 14
                              TERM AND TERMINATION

        14.1 Agreement Term. This Agreement shall become effective as of the
Effective Date and shall continue in full force and effect until the expiration,
revocation or invalidation of the last issued patent within the TWT Patents or
TWAgbio Patents. Without limiting the foregoing, it is understood that the
Development Program and certain other obligations may be terminated as set forth
in Section 14.4 below.

                                      -29-
<PAGE>   30

        14.2 Effect of Expiration.

            14.2.1 Accrued Obligations. Expiration of this Agreement for any
reason shall not release either party hereto from any liability which, at the
time of such expiration, has already accrued to the other party or which is
attributable to a period prior to such expiration nor preclude either party from
pursuing all rights and remedies it may have hereunder or at law or in equity
with respect to any breach of this Agreement.

            14.2.2 Survival. Articles 1, 9, 10, 12, 13, 14, 15, 16 and Section
8.3 shall survive the expiration of this Agreement; without limiting the
foregoing, it is understood that the licenses granted under Sections 9.1 and 9.2
with respect to TWT Technical Information and TWAgbio Technical Information,
respectively, shall survive any expiration of this Agreement and shall become
irrevocable after such expiration. In addition, the provisions of Sections 7.1.1
and 7.1.2 shall survive the termination or expiration of this Agreement for any
reason for the terms specified therein.

        14.3 Term of the Development Program. The Development Program shall
commence on the Effective Date and continue until the expiration of the Initial
Term of the Development Program. Notwithstanding the foregoing, unless earlier
terminated pursuant to Section 14.4 below the Development Program may be renewed
for additional one (1)-year periods (each such period an "Extension Period")
upon mutual agreement of the parties; provided that neither party shall be
obligated to approve any such renewal and shall have no liability whatsoever by
reason of any failure to agree on any such renewal.

        14.4 Termination of the Development Program and certain other
obligations.

            14.4.1 For Breach. In the event of a material breach of a party of
its obligations hereunder, the nonbreaching party shall be entitled to terminate
the Development Program and such other applicable obligations as set forth in
Section 14.5 below by written notice to the breaching party, if such breach is
not cured within thirty (30) days after written notice is given by the
nonbreaching party to the breaching party specifying the breach. This Section
14.4.1 shall not limit any other remedies either party may have under applicable
law.

            14.4.2 Upon Acquisition. Either party (for purposes of this Section
14.4.2, the "Terminating Party") shall have the right to terminate the
Development Program upon written notice to the other party in the event that the
Terminating Party is acquired (whether through merger, consolidation,
acquisition, directly or indirectly, of stock representing fifty percent (50%)
or more of the outstanding voting stock or other of its equity securities, sale
of all or substantially all of its assets related to this Agreement, or
otherwise) by a third party. Notwithstanding the foregoing, in no event will the
underwritten public offering of securities give rise to a right to terminate the
Development Program under this Section 14.4.2. If notice of termination is given
by TWT under this Section 14.4.2, the termination shall become effective upon
the later of: (i) six (6) months after such notice is given, or (ii) December
31, 2001. If notice of termination is given by TWAgbio under this Section
14.4.2, the termination shall become effective upon the later of: (a) at such
time the notice is given, or (b) December 31, 2001.

                                      -30-
<PAGE>   31

        14.5 Effect of Termination.

            14.5.1 Accrued Obligations. Termination of the Development Program
for any reason shall not release either party hereto from any liability which,
at the time of such termination, has already accrued to the other party or which
is attributable to a period prior to such termination nor preclude either party
from pursuing all rights and remedies it may have available hereunder or at law
or equity with respect to any breach hereunder.

            14.5.2 For Breach by TWT. In the event of termination of the
Development Program by TWAgbio pursuant to Section 14.4.1 above as a result of
TWT's material breach the following shall apply: (i) TWAgbio shall have no
further obligation to reimburse TWT for Development Costs incurred after the
effective date of such termination; (ii) TWT shall promptly provide TWAgbio with
a written report of the progress of the Development Program since the last such
report under Section 5.3.2 above; and (iii) notwithstanding anything herein to
the contrary, for purposes of the definition of TWT Technology the "Term of the
Development Program" shall be deemed to continue until it would have otherwise
have expired without regard to such termination. For avoidance of doubt, in such
event for purposes of the definition of TWAgbio Technology the "Term of the
Development Program" shall terminate on the effective date of termination given
in accordance with Section 14.4.1 above.

            14.5.3 For Breach by TWAgbio; Acquisition of TWAgbio.

                (a) Development Program. In the event of termination of the
Development Program by TWT pursuant to Section 14.4.1 above as a result of
TWAgbio's material breach or by TWAgbio in accordance with Section 14.4.2, the
following shall apply: TWAgbio shall pay to TWT an amount equal to (i) the
amounts budgeted to be incurred by TWT in accordance with the then-current
Annual Plan and Budget over the six (6)-month period after the effective date of
such termination; and (ii) the costs of any noncancellable commitments to be
incurred by TWT in accordance the then-current Annual Plan and Budget, to the
extent not within clause (i) above. TWAgbio shall make the payments to TWT under
this Section 14.5.3 within thirty (30) days after the notice of termination is
given hereunder, and upon such payment, TWAgbio shall have no further obligation
under Section 6.2 above. In the event there are less than six (6) months
remaining under the Annual Plan and Budget in effect on the date the notice of
termination is given, such Annual Plan and Budget shall be deemed extended so
that there are six (6) months remaining at the same average monthly amounts as
are in the remaining term of the then-current Annual Plan and Budget. It is
further understood and agreed that if the Development Program is terminated
pursuant to an event described in this Section 14.5.3, TWT shall have the right
to use amounts received under this Section 14.5.3 and any other amounts received
prior to the effective date of such termination as TWT deems fit in its sole
discretion, and shall have not further obligation with respect to such amounts.
In addition in the event of termination of the Development Program by TWT
pursuant to Section 14.4.1 above as a result of TWAgbio's breach of its
obligations with respect to the Development Program and notwithstanding anything
herein to the contrary, for purposes of the definition of TWAgbio Technology the
"Term of the Development Program" shall be deemed to continue until it would
have otherwise have expired without regard to such termination. For avoidance of
doubt, in such

                                      -31-
<PAGE>   32

event for purposes of the definition of TWT Technology the "Term of the
Development Program" shall terminate on the effective date of termination given
in accordance with Section 14.4.1 above.

                (b) Certain other Obligations. In addition to the provisions of
Section 14.5.3(a) above and 14.5.4 below, in the event that TWT terminates the
Development Program as a result of the material breach of TWAgbio, TWT's
obligations (but not its rights) under Article 7 shall terminate.

            14.5.4 Other. For avoidance of doubt, as of the effective date of
termination of the Development Program for any reason and except as otherwise
expressly provided herein the rights and obligations of the parties under
Articles 2, 3, 4, 5 and 6 shall terminate.

                                   ARTICLE 15
                               DISPUTE RESOLUTION

        15.1 Disputes. If the JDC, or the parties, are unable to resolve any
dispute between them arising out of this Agreement, either party may, by written
notice to the other, have such dispute referred to the Chief Executive Officers
of each TWT and TWAgbio for attempted resolution by good faith negotiations
within thirty (30) days after such notice is received. Unless otherwise mutually
agreed, the negotiations between the designated officers shall be conducted by
telephone.

        15.2 Full Arbitration. Except as otherwise expressly set forth in
Section 15.3 below, any dispute, controversy or claim arising out of or relating
to the validity, construction, enforceability or performance of this Agreement,
including disputes relating to alleged breach or to termination of this
Agreement shall be settled by binding arbitration in the manner described in
this Section 15.2. The arbitration shall be conducted pursuant to the Licensing
Rules of the American Arbitration Association then in effect. Notwithstanding
those rules, the following provisions shall apply to the arbitration hereunder:

            15.2.1 Arbitrators. The arbitration shall be conducted by a single
arbitrator; provided that at the request of either party, the arbitration shall
be conducted by a panel of three (3) arbitrators, with one (1) arbitrator chosen
by each of TWT and TWAgbio's Board of Directors and the third appointed by the
other two (2) arbitrators. If the parties are unable to agree upon a single
arbitrator, or the third arbitrator in case of a panel of three (3), such single
or third arbitrator (as the case may be) shall be appointed in accordance with
the rules of the American Arbitration Association. In any event, the arbitrator
or arbitrators selected in accordance with this Section 15.2.1 are referred to
herein as the "Panel" and shall be comprised of independent experts in the area
of the dispute.

            15.2.2 Proceedings. Except as otherwise provided herein, the parties
and the arbitrators shall use their best efforts to complete the arbitration
within six (6) months after the appointment of the Panel under Section 15.2.1
above, unless a party can demonstrate to the Panel that the complexity of the
issues or other reasons warrant the extension of one or more of the time tables.
In such case, the Panel may extend such time table as reasonably required. The
Panel shall, in rendering its decision, apply the substantive law of the State
of California, without regard to its

                                      -32-
<PAGE>   33

conflict of laws provisions, except that the interpretation of and enforcement
of this Article 15 shall be governed by the U.S. Federal Arbitration Act. The
proceedings shall take place in San Francisco, California or such other location
mutually agreeable to the parties. The fees of the Panel shall be paid by the
losing party which party shall be designated by the Panel. If the Panel is
unable to designate a losing party, it shall so state and the fees shall be
split equally between the parties. Each party shall bear the costs of its own
attorneys' and experts' fees; provided that the Panel may in its discretion
award the prevailing party all or part of the costs and expenses incurred by the
prevailing party in connection with the arbitration proceeding. Neither party
shall initiate an arbitration hereunder unless it has attempted to resolve the
matter in accordance with Section 15.1 above.

            15.2.3 Equitable Remedies. In addition, each party hereto agrees
that either party may petition the Panel or a court having competent
jurisdiction for equitable relief, in lieu of or in addition to arbitration
proceedings, under any circumstances where such equitable remedies (including an
injunction or temporary restraining order) would be appropriate under state or
federal law. In the event that the Panel provides for equitable relief, the
parties shall submit such decision to a court of competent jurisdiction for
enforcement.

        15.3 Short Form Arbitration. If (i) the JDC is unable to agree upon the
Annual Plan and Budget for any fiscal year in accordance with Section 4.2 above
or (ii) there is any dispute with respect to the division of recoveries from an
Enforcement Action in accordance with Section 10.3.4, then upon written request
by either party such matters in issue shall be determined by binding arbitration
conducted pursuant to this Section 15.3 by one (1) arbitrator. In such
arbitration, the arbitrator shall be an independent expert (including in the
area of the dispute) in the biotechnology industry mutually acceptable to the
parties. If the parties are unable to agree on an arbitrator, the arbitrator
shall be an independent expert as described in the preceding sentence selected
by the chief executive of the San Francisco, California office of the American
Arbitration Association. The proceedings shall take place in San Francisco,
California or such other location mutually agreeable to the parties. With
respect to matters arising under clause (i) above, each party to the arbitration
shall prepare a written proposal setting forth its position with respect to the
substance of the Annual Plan and Budget or Annual Plan and Budget, as
applicable, for the upcoming year, in each case subject to Section 3.5 above.
The arbitrator shall select one of the requested positions as his decision, and
shall not have authority to render any substantive decision other than to so
select the position of either TWT or TWAgbio. The costs of such arbitration
shall be shared equally by the parties, and each party shall bear its own
expenses in connection with such arbitration. Any such arbitration shall be
completed within thirty (30) days following a request by any party for such
arbitration.

                                   ARTICLE 16
                                  MISCELLANEOUS

        16.1 Governing Law. This Agreement and any dispute arising from the
performance or breach hereof shall be governed by and construed and enforced in
accordance with, the laws of the State of California, without reference to
conflicts of laws principles.

                                      -33-
<PAGE>   34

        16.2 Force Majeure. Nonperformance of any party (except for payment of
amounts due hereunder) shall be excused to the extent that performance is
rendered impossible by strike, fire, earthquake, flood, governmental acts or
orders or restrictions, or any other reason, including failure of suppliers,
where failure to perform is beyond the reasonable control of the nonperforming
party.

        16.3 No Implied Waivers; Rights Cumulative. No failure on the part of
TWT or TWAgbio to exercise and no delay in exercising any right under this
Agreement, or provided by statute or at law or in equity or otherwise, shall
impair, prejudice or constitute a waiver of any such right, nor shall any
partial exercise of any such right preclude any other or further exercise
thereof or the exercise of any other right.

        16.4 Independent Contractors. All debts and liabilities of and
arrangements or agreements with any person or entity incurred or entered into in
the name of or on behalf of TWAgbio by TWT in the management or performance of
the Services hereunder in accordance with this Agreement shall be the debt and
liability of and be binding upon TWAgbio. TWT shall not be liable to any person
or entity for any debt, liability or obligation of TWAgbio incurred or created
in accordance with this Agreement or by reason of TWT's management, direction or
performance of the Services hereunder unless TWT, by written agreement,
expressly assumes or guarantees any such liability. TWT shall not be required,
under any circumstances, to guarantee or assume any obligation or liability of
TWAgbio as a result of this Agreement. TWAgbio's Board of Directors shall be
deemed to control all aspects of the manner in which TWAgbio's business is
conducted. TWT shall not be liable by virtue of the performance of its duties
hereunder for any breach of any arrangement between TWAgbio and any third party,
or for any liability for any unfair competition, patent infringement or other
violation of the intellectual property rights of another entity as a result of
the manner in which TWAgbio's business is conducted, except to the extent such
violation is the result of the gross negligence or willful misconduct of TWT.

        16.5 Notices. All notices, requests and other communications hereunder
shall be in writing and shall be personally delivered or sent by registered or
certified mail, return receipt requested, postage prepaid; facsimile
transmission (receipt verified); or express courier service (signature
required), in each case to the respective address or fax number specified below,
or such other address or fax number as may be specified in writing to the other
parties hereto:

        TWAgbio:                               Third Wave Agbio, Inc.
                                               502 South Rosa Road
                                               Madison, Wisconsin 53719
                                               Attn:  Chief Executive Officer
                                               Fax:  (608) 663-7061

                                      -34-
<PAGE>   35

        with a copy to:                        Heller Ehrman White & McAuliffe
                                               525 University Ave., Suite 1100
                                               Palo Alto, CA  94301-1900
                                               Attn: Richard A. Peers, Esq.
                                               Fax:  (650) 324-0638

        Third Wave:                            Third Wave Technologies, Inc.
                                               502 South Rosa Road
                                               Madison, Wisconsin 53719
                                               Attn:  Chief Executive Officer
                                               Fax:  (608) 273-8618

        with a copy to:                        Wilson Sonsini Goodrich & Rosati
                                               Professional Corporation
                                               650 Page Mill Road
                                               Palo Alto, California 94304-1050
                                               Attn:  Kenneth A. Clark, Esq.
                                               Fax:  (650) 493-6811

        16.6 Limitation of Liability. NEITHER PARTY SHALL BE LIABLE TO THE OTHER
PARTY FOR ANY SPECIAL, CONSEQUENTIAL, EXEMPLARY OR INCIDENTAL DAMAGES (INCLUDING
LOST OR ANTICIPATED REVENUES OR PROFITS RELATING TO THE SAME), ARISING FROM ANY
CLAIM RELATING TO THIS AGREEMENT, WHETHER SUCH CLAIM IS BASED ON CONTRACT, TORT
(INCLUDING NEGLIGENCE) OR OTHERWISE, EVEN IF AN AUTHORIZED REPRESENTATIVE OF
SUCH PARTY IS ADVISED OF THE POSSIBILITY OR LIKELIHOOD OF SAME.

        16.7 Assignment. This Agreement shall not be assignable by either party
to any third party without the written consent of the other party hereto; except
that either party may assign this Agreement without the other party's consent to
an entity that acquires substantially all of the business or assets of the
assigning party, in each case whether by merger, transfer of assets, or
otherwise. Without limiting the foregoing, in the event of such merger or
transfer or acquisition of assets, no intellectual property rights of the
assignee or its affiliate shall be included in the TWT Technology or the TWAgbio
Technology, as applicable, to the extent that such intellectual property rights
were Controlled by the assignee or its affiliate prior to such merger or
transfer or acquisition of assets, or are created outside the Term of the
Development Program by personnel who were not employees of TWT or TWAgbio,
respectively prior to the merger or transfer or acquisition of assets. Upon a
permitted assignment of this Agreement, all references herein to the assigning
party shall be deemed references to the party to whom the Agreement is so
assigned. Any assignment not permitted under this Section 16.7 shall be null and
void.

        16.8 Compliance with Investment Agreement. The parties hereto
acknowledge and agree that by entering into this Agreement they have complied
with and fulfilled the terms and conditions of Section 5.1 of the Investment
Agreement.

                                      -35-
<PAGE>   36

        16.9 Modification. No amendment or modification of any provision of this
Agreement shall be effective unless in writing signed by both parties hereto.

        16.10 Severability. If any provision hereof should be held invalid,
illegal or unenforceable in any jurisdiction, the parties shall negotiate in
good faith a valid, legal and enforceable substitute provision that most nearly
reflects the original intent of the parties and all other provisions hereof
shall remain in full force and effect in such jurisdiction and shall be
liberally construed in order to carry out the intentions of the parties hereto
as nearly as may be possible. Such invalidity, illegality or unenforceability
shall not affect the validity, legality or enforceability of such provision in
any other jurisdiction.

        16.11 Confidential Terms. Except as expressly provided herein, each
party agrees not to disclose any terms of this Agreement to any third party
without the consent of the other party, except as required by securities or
other applicable laws, to prospective and other investors and such party's
accountants, attorneys and other professional advisors.

        16.12 Headings. Headings used herein are for convenience only and shall
not in any way affect the construction of or be taken into consideration in
interpreting this Agreement.

        16.13 Patent Marking. TWAgbio and TWT agree to mark or have marked all
patented Products or TWT Products, respectively, sold or otherwise distributed
by or under its authority pursuant to this Agreement in accordance with the
applicable patent statutes or regulations in the country or countries of
manufacture and sale thereof.

        16.14 Further Assurances. At any time or from time to time after the
Effective Date, TWAgbio and TWT each agree at the reasonable request and expense
of the other party to take or cause to be taken all such actions, as the other
party may deem necessary or desirable in order for the other party to obtain the
full benefits of this Agreement and the transactions contemplated hereby.

        16.15 Entire Agreement. This Agreement (including the Exhibits hereto)
constitutes the entire agreement, both written or oral, with respect to the
subject matter hereof, and supersedes all prior or contemporaneous
understandings or agreements, whether written or oral, between TWT and TWAgbio
with respect to such subject matter, including, without limitation, the
Investment Agreement.

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

              [THE REMAINDER OF THIS PAGE LEFT INTENTIONALLY BLANK]

                                      -36-
<PAGE>   37

        IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered in duplicate originals as of the date first above
written.

THIRD WAVE TECHNOLOGIES, INC.

By:
    ----------------------------------------
Name:  Lance Fors
       -------------------------------------
Title:  President & CEO
        ------------------------------------

THIRD WAVE AGBIO, INC.

By:
    ----------------------------------------
Name:  Glen Donald
       -------------------------------------
Title:  Chief Executive Officer
        ------------------------------------

ACKNOWLEDGED and AGREED

BURRILL AGBIO FUND, L.P.

By:
    ----------------------------------------
Name:
     ---------------------------------------
Title:
      --------------------------------------
Date:
      --------------------------------------

EXHIBIT 1.3--CLEAVASE ENZYMES
EXHIBIT 1.12--DEFINITION OF FIELD OF AGRICULTURE
EXHIBIT 1.28--THIRD PARTY AGREEMENTS
EXHIBIT 1.34--TWT TRADEMARKS
EXHIBIT 6.1--FTE RATES

<PAGE>   38

                                   EXHIBIT 1.3

                                CLEAVASE ENZYMES

-    Cleavase I

-    Cleavase VII

-    Cleavase VIII

                                      -i-

<PAGE>   39

                                  EXHIBIT 1.12

                       DEFINITION OF FIELD OF AGRICULTURE

        "Field of Agriculture" or "Field" shall mean applications relating to
(i) cultivating, characterizing or modifying soil; (ii) producing, growing,
improving, protecting, treating or modifying crops or forest products; (iii)
raising, harvesting, improving, protecting, treating or modifying livestock,
poultry, fish or shellfish; and (iv) the preparation, marketing or treatment of
products resulting from the activities described in (i)-(iii) above. The Field
shall include applications involving the improvement or modification of soil,
crops, livestock, poultry, fish or shellfish and their resulting products as
they relate to human health, as well as foods from plants and animals designed
or modified to enhance their health attributes, in each case for nutraceutical
applications but not therapeutic applications in humans. The Field shall also
include agricultural applications relating to bacteria, fungi, and viruses, as
well as pest organisms with respect to, and only to the extent of, such
bacteria, fungi, viruses or pest organisms' interaction with soil, plants,
livestock, poultry, fish or shellfish. For avoidance of doubt it is acknowledged
and understood that the Field includes genes and gene-based or genetic
technologies useful for achieving the above described activities, in particular:

        -   Gene-based assays for pesticide discovery;

        -   Gene-based diagnostics of agricultural pests;

        -   Gene-based analysis of metabolism of pesticides in plants and pest
            organisms;

        -   Gene-based analysis of metabolism and physiological state of plants;
            livestock, poultry, fish, shellfish, or their pests;

        -   Genetic modification of pest organism for functional analysis of
            pest-related properties;

        -   Genetic modification of pest, bacteria, fungi, or viruses for
            functional analysis and optimization as protectants or growth
            stimulators of plants, livestock, poultry, fish or shellfish;

        -   Functional genetic analysis of the genomes of plants, livestock,
            poultry, fish, or shellfish or their pest for applications in
            agriculture;

        -   Genetic modification of plants, livestock, poultry, fish, or
            shellfish or their pests with the goal of enhancing properties
            relevant to production and end-use (i.e.; input and output traits);

        -   Gene-based diagnostics for determining seed and crop composition and
            quality; and

                                      -ii-

<PAGE>   40

        -   Gene-based markers for facilitation of the breeding of plants,
            livestock, poultry, fish, or shellfish or their pests for
            applications in agriculture.

        The Field shall further include food safety applications relating to
crops or livestock up to the stage at which the crops are processed into
materials or food ingredients for human consumption or the livestock are
slaughtered (i.e., unprocessed food safety applications). Without limiting the
foregoing, the Field shall not include any such application relating to crops or
livestock after the stage at which the crops are processed into materials or
food ingredients for human consumption or the livestock are slaughtered (i.e.,
processed food safety applications).

        The Field of Agriculture shall exclude all applications not expressly
described above. For avoidance of doubt, the Field shall in no case include
human applications (e.g., research, diagnostic or therapeutic) nor any
application for the discovery, production, or development of products for
therapeutic applications in humans, including without limitation, the discovery,
development, use and raising of animal models of human disease or animals for
xenotransplantation applications in humans.

                                     -iii-
<PAGE>   41

                                  EXHIBIT 1.28

                             THIRD PARTY AGREEMENTS

-    Nonexclusive License Agreement by and between TWT and Wisconsin Alumni
     Research Foundation ("WARF") effective March 1, 1994.

-    Standard Exclusive License Agreement by and between TWT and WARF effective
     August 19, 1998.

It is understood and agreed that to the extent one of the foregoing agreements
requires that particular provisions be incorporated in a sublicense granted
thereunder, such provision shall be deemed incorporated in this Agreement by
reference with respect to the subject matter so sublicensed hereunder.

                                      -iv-

<PAGE>   42

                                  EXHIBIT 1.34

                                 TWT TRADEMARKS

-    "CFLP"

-    "Cleavase"

-    "Cleavase Fragment Length Polymorphism"

-    "Invader"

-    "InvaderCreator"

-    "Invader Squared"

-    "Invader(2)"

-    "PowerScan"

-    The Third Wave Dot Symbol represented below in Pantone 341 or such other
     colors as the parties may mutually agree in writing.

                                      -v-

<PAGE>   43

EXHIBIT 6.1

                                    FTE RATES

             Classification                FTE Rate (as of Effective Date)

         Development Personnel                         $130,000

           Service Personnel                    (as calculated below)

With respect to Service Personnel the FTE rate shall be equal to the Salary Plus
Fringe Rate for such Service Personnel multiplied by TWT's G&A overhead rate
based on TWT's most recently completed fiscal year as calculated in accordance
with GAAP. It being understood that the foregoing G&A overhead rate shall not
include any research and development overhead absorption. For purposes of the
foregoing, the Salary Plus Fringe Rate, with respect to a particular Service
Personnel, shall equal such Service Personnel's actual Salary added to TWT's
fringe benefit rate of 28% (as may be reasonably adjusted).

                                      -vi-

<PAGE>   44

        In December 1999, we entered into an Operation, Development and Supply
Agreement with Third Wave AgBio, Inc., known as TWT AgBio, under which we are
developing agricultural applications of our Invader operating system. We are
also providing administrative and management services to TWT AgBio under this
agreement. TWTI AgBio will have rights to commercialize products developed under
this agreement. TWTI AgBio is owned jointly by us and by a venture capital fund
that is managed by Steven Burrill, one of our directors.<PAGE>   1

                                                                   EXHIBIT 10.18

                                LEASE AGREEMENT

LANDLORD:           UNIVERSITY RESEARCH PARK FACILITIES CORP.

TENANT:             THIRD WAVE TECHNOLOGIES, INC.

PROPERTY:           ___ Rosa Road Madison, Wisconsin

DATE:               April  1, 1997

<PAGE>   2
                                LEASE AGREEMENT

                               TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                     PAGE
<S>                                                                                  <C>
ARTICLE I
PREMISES AND TERM ..............................................................       1

Section 1.1 Leased Premises ....................................................       1
Section 1.2 Term of Lease ......................................................       2
Section 1.3. Option to Extend Tetra ............................................       2
Section 1.4 First Option To Lease Additional Buildings .........................       2
Section 1.5 Security Deposit ...................................................       3
Section 1.6. Additional Improvements ...........................................       3

ARTICLE 2
RENT ...........................................................................       4

Section 2.2 Additional Rent ....................................................       5
Section 2.3 Past Due Rent ......................................................       5
Section 2.4 Real Estate Taxes ..................................................       5

ARTICLE 3
INSTALLATIONS, REPAIRS AND MAINTENANCE OF LEASE PREMISES .......................       6

Section 3.1 Maintenance by Tenant ..............................................       6
Section 3.2 Maintenance by Landlord ............................................       7
Section 3.3 Exterior Signs .....................................................       7
Section 3.4. Alterations, Changes and Installations by Tenant ..................       8
Section 3.5 Fixtures and Equipment .............................................       8
Section 3.6 Liens and Obligations ..............................................       8

ARTICLE 4
CONDUCT OF BUSINESS ............................................................       9

Section 4.1 Business Use .......................................................       9
Section 4.2 Utility Charges ....................................................      10
Section 4.3 Assignment or Subletting ...........................................      10
Section 4.4 Rules and Regulations ..............................................      10
Section 4.5. ADA Compliance ....................................................      11
Section 4.6 Surrender ..........................................................      12

ARTICLE 5
COMMON USE AREAS AND FACILITIES ................................................      13

Section 5.1. Common Area .......................................................      13
Section 5.2. Use of Common Area ................................................      14
Section 5.3. Operation and Maintenance .........................................      15
Section 5.4. Preventing Public Rights ..........................................      15
Section 5.5. Charge for Common Area and Facilities .............................      15
</TABLE>

                                       i

<PAGE>   3
<TABLE>
<S>                                                                                  <C>
Section 5.6. Formula For Pro Rata Share ........................................      16
Section 5.7. Basis For Changes .................................................      16

ARTICLE 6
INSURANCE ......................................................................      17

Section 6.1. Casualty Insurance ................................................      17
Section 6.2. Public Liability Insurance ........................................      17
Section 6.3. Tenant's Contents .................................................      18
Section 6.4. Increase in Fire Insurance ........................................      18
Section 6.5. Hold Harmless .....................................................      19
Section 6.6. Waiver of Subrogation .............................................      20

ARTICLE 7
DESTRUCTION OF LEASED PREMISES .................................................      21

Section 7.1. Destruction of Leased Premises ....................................      21
Section 7.2. Rebuilding by Landlord ............................................      21
Section 7.3. Abatement of Rent Upon Destruction of Premises ....................      21

ARTICLE 8
EFFECT OF CONDEMNATION .........................................................      22

Section 8.1. Total Condemnation ................................................      22
Section 8.2. Partial Condemnation ..............................................      22
Section 8.3. Landlord's Damages ................................................      22
Section 8.4. Tenant's Damages ..................................................      22

ARTICLE 9
REMEDIES .......................................................................      23

Section 9.1. Events of Default by Tenant .......................................      23
Section 9.2. Re-Entry by Landlord ..............................................      23
Section 9.3. Right to Relet ....................................................      23
Section 9.4. Parties May Remedy Defaults .......................................      24
Section 9.5. Landlord's Remedies: Liquidated Damages ...........................      25
Section 9.6. Expenses of Landlord ..............................................      27
Section 9.7. Waiver of Redemption ..............................................      27
Section 9.8. Defaults of Landlord ..............................................      27
Section 9.9. Rights Cumulative .................................................      27

ARTICLE 10
MISCELLANEOUS ..................................................................      27

Section 10.1. Subordination ....................................................      27
Section 10.2. Sale of Landlord's Interest ......................................      28
Section 10.3. Offset Statement .................................................      30
Section 10.4. Attornment .......................................................      30
Section 10.5. Recording ........................................................      30
</TABLE>

                                       ii

<PAGE>   4
<TABLE>
<S>                                                                                  <C>
Section 10.6. Excavations ......................................................      30
Section 10.7. Access to Premises ...............................................      31
Section 10.8. Quiet Enjoyment ..................................................      31
Section 10.9. Notices ..........................................................      31
Section 10.10. Holding Over ....................................................      32
Section 10.11. Consents by Landlord ............................................      32
Section 10.12. Successors and Assigns ..........................................      32
Section 10.13. Governmental Regulations ........................................      32
Section 10.14. Certain Expenses of Landlord ....................................      32
Section 10.15. Force Majeure ...................................................      33
Section 10.16. General .........................................................      33
Section 10.17. Effect of Ground Lease ..........................................      34

ARTICLE 11
ATTACHMENTS ....................................................................      34

Section 11.1. Attachments ......................................................      34
</TABLE>

                                      iii

<PAGE>   5
                            UNIVERSITY RESEARCH PARK

                                 LEASE AGREEMENT

        This Lease is made as of the later of dates set forth below the
signatures on the last page hereof, by and between University Research Park
Facilities Corp., a Wisconsin corporation (hereinafter referred to as
"Landlord") and Third Wave Technologies, Ire., a Wisconsin corporation
(hereinafter referred to as "Tenant").

                                  WITNESSETH:

        IT IS HEREBY AGREED, by and between the parties hereto, in consideration
of the covenants and agreements set forth in this Lease, as follows:

                                   ARTICLE 1

                               PREMISES AND TERM

        SECTION 1.1 LEASED PREMISES. Landlord hereby leases to Tenant and Tenant
hereby leases from Landlord on the terms and provisions and subject to the
conditions hereinafter set forth in this Lease, the following described
premises:

        ______ Rosa Road, Madison, Dane County, Wisconsin, (herein referred to
        as the "Leased Premises") consisting of approximately 25,000 square feet
        of space and all necessary parking, landscaped and common areas located
        in and around that certain building (the "Building") situated upon the
        property described in Exhibit A attached hereto (the property described
        in Exhibit A is referred to herein as the "Landlord's Property"). The
        location of the Building on Landlord's Property is indicated on the site
        plan attached hereto as Exhibit B.

        It is understood and acknowledged by both parties that Landlord, at the
time of execution of this Lease, holds all or a portion of the Leased Premises
as a tenant under a ground lease

<PAGE>   6
        SECTION 1.2 TERM OF LEASE. The term of this Lease ("the term") shall
begin on ("the commencement date") (a) the date on which a certificate of
occupancy is issued by the City of Madison for the Building in which the Leased
Premises are to be located (which date is expected to be between November 1,
1997 and December 15, 1997); or (b) when Tenant occupies and commences use of
the Leased Premises, whichever date shall be earlier. Subject to the provisions
of Section 1.3 below, the term shall end at midnight on the date five (5) years
thereafter; provided, however, that if the commencement date falls on other than
the first day of a calendar month, the term shall end at midnight five (5) years
after the last day of the calendar month in which the commencement date occurs.

        SECTION 1.3. OPTION TO EXTEND TERM. Tenant is hereby granted an option
to extend the term of this Lease for three (3) five (5) year periods, each such
extended terms to begin upon the expiration of the original term or prior
extended term, as the case may be; and all terms, covenants and provisions of
this Lease shall apply to the extended terms with the exception that after the
exercise of such options Tenant shall not have any further options to extend. If
Tenant elects to exercise any option to extend, Tenant shall do so only by
giving Landlord notice in writing of its intention to do so not later than
twelve (12) months prior to the expiration of the original term, or the then
current extended term, as the case may be.

        SECTION 1.4 FIRST OPTION TO LEASE ADDITIONAL BUILDINGS. The Building may
be part of a multi-building development on property adjacent to Landlord's
Property (the "Expansion Property") which is also described on Exhibit A. Tenant
shall have the first option to lease space in any buildings constructed on the
"Expansion Property." Construction of such additional buildings shall proceed on
a schedule determined by Landlord provided occupancy of any such

                                       2

<PAGE>   7

additional building shall not be prior to December 31, 2002. Prior to entering
into any binding obligation to lease space in any such additional buildings,
Landlord shall first offer such space to Tenant in writing on Landlord's then
current lease terms. Tenant shall have sixty (60) days to accept such offer. If
Tenant does not accept such offer in writing within such time period, Tenant
shall have no further rights with respect to the space thus offered. The
foregoing notwithstanding, prior to the time when Landlord has entered into
binding obligations to lease space in either or both additional buildings,
Tenant may request that Landlord construct additional buildings for occupation
by Tenant at Landlord's then current lease rates but Landlord shall not be
obligated to construct any such buildings. In addition, if Landlord does agree
to construct any such additional building, it shall not be required to commence
construction until Tenant has executed a lease with respect to any such
additional space on Landlord's then current lease terms.

        SECTION 1.5 SECURITY DEPOSIT. Tenant shall provide to Landlord upon
execution of this Lease an irrevocable letter of credit in the sum of Six
Hundred Twenty-five Thousand Dollars ($625,000.00) issued by a financial
institution and on a form acceptable to Landlord as security for the performance
of the obligations hereof by Tenant. This letter of credit may provide for a
reduction of the face amount on a schedule corresponding to the remaining amount
of unpaid additional rent under Section 2.1(b) and shall be released as of the
end of the initial team of this Lease, provided Tenant is not then in default.

        SECTION 1.6 ADDITIONAL IMPROVEMENTS. The Leased Premises are to be
located in the Building to be constructed by Landlord on Landlord's Property
which Building shall be approximately 25,000 gross square feet and shall be
constructed substantially in compliance with

                                        3

<PAGE>   8

the plans and specifications attached hereto as Exhibit C. Landlord shall
provide tenant improvements for the Leased Premises as provided on Exhibit C,
provided the cost of such tenant improvements, not including HVAC, electrical
and plumbing distribution, does not exceed $504,000.00. Any such costs in excess
of $504,000.00 shall be Tenant's sole responsibility.

                                   ARTICLE 2

                                      RENT

        SECTION 2.1 BASE RENT. Tenant shall pay to Landlord at its office in
Madison, Wisconsin, or such other place as Landlord may designate in writing,
and without any deduction or offset whatsoever, as base rent, the following
amounts on or in advance of the first day of each calendar month:

        (a)     The sum of Nine Dollars ($9.00) per square foot per year in 12
                equal monthly installments during the first year of this Lease;
                and

        (b)     The sum of $122,632.00 per year in 12 equal monthly installments
                during the initial term of this Lease; and

        (c)     The base rent-provided for in paragraph 2.1(a) above shall be
                increased by four (4%) percent compounded annually. The first
                such increase shall take place on January 1, 1999.

        For purposes of paragraph 2.1(a), the number of square fax in the Leased
premises shall be the actual gross square footage of the Leased Premises as
certified by Strang, Inc. If the term of this Lease does not commence on the
first day of a calendar month, the base rent for such fractional month shall be
computed pro rata on the basis of thirty (30) days per month and

                                       4

<PAGE>   9
paid to Landlord on the first day of the next succeeding calendar month along
with the rent for such succeeding month.

        SECTION 2.2 ADDITIONAL RENT. In addition to base rent, Tenant shall pay
as part of the consideration for this Lease and as additional rent, hereinafter
designated "additional rent," all additional amounts hereinafter provided for
and the same shall be payable upon Landlord's demand except as otherwise
expressly provided.

        SECTION 2.3 PAST DUE RENT. If Tenant shall fail to pay when due any base
rent or additional rent and such amount shall not be paid within ten (10) days
after the date when due, such unpaid amounts shall bear interest from the due
date thereof to the date of payment at the rate of ten (10%) percent per annum
or the prime interest rate then charged by the Firstar Bank Wisconsin or its
successors or assigns, whichever is greater.

        SECTION 2.4 REAL ESTATE TAXES. Landlord shall pay all real estate taxes
on Landlord's Property, including all general real estate taxes, personal
property taxes on Landlord's Property and installments for special assessments
arising during the term of the Lease. Tenant agrees to reimburse Landlord for
Tenant's pro rata share of such taxes. Until substantial completion of
additional buildings on the Expansion Property, Tenant's pro rata share of such
taxes shall be 100%.

        Tenant's obligation for each tax described in this section shall be
further prorated for the first year of this Lease between Landlord and Tenant as
of the commencement date of this Lease.

        Along with Tenant's monthly teat, Tenant shall pay to Landlord an amount
equal to one twelfth (1/12) of its pro rata share of the estimated annual real
estate taxes, personal property

                                       5

<PAGE>   10
taxes and installments for special assessments for Landlord's Property. Such
payment shall be applied by Landlord to the payment of the taxes on the
Landlord's Property. Tenant shall be responsible for the prompt payment of its
pro rata share of any deficiency so that all such taxes shall be paid before the
same become delinquent. At the termination of this Lease, Tenant shall promptly
pay Landlord for Tenant's pro rata share of the estimated taxes for that portion
of the termination year during which the Lease is in effect. Such estimate shall
be based upon the taxes for the preceding year.

        Tenant's pro rata share of taxes shall be adjusted from time to time as
additional buildings are included in the Project as substantially completed
described in Article 5 hereof.

                                    ARTICLE 3

            INSTALLATIONS, REPAIRS AND MAINTENANCE OF LEASE PREMISES

        SECTION 3.1 MAINTENANCE BY TENANT. Tenant shall at all times keep the
Used Premises and all tenant improvements, partitions, doors, fixtures,
electrical and lighting fixtures, equipment and appurtenances thereof (including
but not limited to lighting, electrical and plumbing equipment, fixtures and
lines located outside the Leased Premises, but excluding such equipment,
fixtures and lines to the extent they serve the entire Building or areas in
addition to the Leased Premises) in good order, condition and repair, including
periodic painting as determined by Landlord. If Tenant refuses or neglects to
repair property as required hereunder and to the reasonable satisfaction of
Landlord as soon as reasonably possible after written demand, Landlord may make
such repairs without liability to Tenant for any loss or damage that may accrue
to Tenant's property or to Tenant's business by reason thereof, and upon
completion thereof, Tenant shall pay Landlord's costs for making such repairs
plus twenty (20%) percent

                                       6

<PAGE>   11
for overhead, upon presentation of bill therefor, as additional rent. When used
in this paragraph, the term "repairs" shall include replacements and renewals
when necessary and all such repairs shall be equal in quality and class of
original work.

        SECTION 3.2 MAINTENANCE BY LANDLORD. Landlord shall keep foundations,
exterior walls, roof and all other structural members, both interior and
exterior, of the Leased Premises and all common areas in good repair and shall
have access to the Leased Premises for such purpose, but Landlord shall not be
required to make any such repairs which become necessary or desirable by reason
of the negligence of Tenant, its agents, servants, employees or customers.
Landlord shall also keep and maintain heating, ventilating, air conditioning,
plumbing and electrical lines, fixtures and equipment (except those which are
the responsibility of Tenant) and Landlord's cost therefor shall be reimbursed
by Tenant along with common area charges pursuant to Section 5.5 below. When
used in this paragraph, the term "repairs" shall include replacements and
renewals when necessary and all such repairs shall be equal in quality and class
of original work. Landlord shall not be required to make any such repairs which
become necessary or desirable by reason of the negligence of Tenant, its agents,
servants, employees or customers.

        SECTION 3.3 EXTERIOR SIGNS. All signs to be installed by Tenant shall be
approved in advance in writing by the Design Review Board appointed by the Board
of Regents of the University of Wisconsin System. All signs to be installed by
Landlord shall be approved in advance in writing by the Design Review Board.

        Tenant shall remove all signs installed by Tenant at the termination of
this Lease. Such installations and removals shall be made in such a manner as to
avoid injury, defacement or any

                                       7
<PAGE>   12
other damages to the buildings and improvements. The cost of repairing any
damage to the building caused by the installation, removal, or maintenance of
the sign shall be borne by the Tenant.

        The cost of all signs, other than those furnished by Landlord, including
the installation, maintenance, and removal thereof, shall be the responsibility
of the Tenant.

        SECTION 3.4. ALTERATIONS, CHANGES AND INSTALLATIONS BY TENANT. Tenant
shall not make or cause to be made any alterations, additions or improvements to
the Leased Premises, or cause to be installed any fixtures, interior or exterior
lighting, plumbing equipment or mechanical equipment, without the prior written
consent of Landlord.

        SECTION 3.5 FIXTURES AND EQUIPMENT. Subject to Section 3.4, Tenant may,
at its own expense, furnish and install such equipment and business and trade
fixtures in and on the Premises as may be necessary or desirable for Tenant's
business. Any such equipment and fixtures shall remain the personal property of
Tenant and may be removed by Tenant during or at the expiration of the term of
this Lease provided Tenant shall repair damage caused by such removal and
restore the Leased Premises to the condition existing prior to installation of
such equipment or fixtures, reasonable wear and tear excepted.

        SECTION 3.6 LIENS AND OBLIGATIONS. Tenant agrees not to create or to
permit others to create any lien or obligations against Landlord or the Leased
Premises in making alterations, repairs or in installing materials, fixtures or
equipment, agrees to cause any claim for such lien to be released, and further
agrees to hold Landlord harmless from all claims and demands by any third party
in any manner connected with such alterations, repairs or installations or with
Tenant's occupancy for such purpose. Tenant shall comply with all laws and all
directions, rules

                                       8
<PAGE>   13
and regulations of all governmental regulatory bodies or officials having
jurisdiction over such alterations, repairs or installations, except that Tenant
shall not be required to comply with any laws, regulations or orders by
governmental authority necessitating structural alterations, changes, repairs or
additions, unless made necessary by the act or work performed by Tenant, in
which case Tenant shall so comply, at its own expense, after first procuring
the written consent of Landlord.

                                    ARTICLE 4

                              CONDUCT OF BUSINESS

        SECTION 4.1 BUSINESS USE. It is understood and agreed that the Leased
Premises shall be used and occupied by Tenant as an office, laboratory and light
manufacturing. Tenant shall not use the Leased Premises for any use not
identified as a permitted use by any zoning ordinance or other governmental
regulation relating to the Leased Premises or approved as a conditional use by
the governmental bodies having zoning authority. No use shall be permitted, or
acts done, which will cause a cancellation of any insurance policy covering the
Leased Premises. Tenant shall not sell, permit to be kept, used or sold in or
about the Leased Premises any article which may be prohibited by the standard
form of fire insurance policy. In the event Tenant's use of the Leased Premises
results in an increase in the cost of any insurance relating to the Landlord's
Property, Tenant shall pay such additional cost to Landlord upon demand. Tenant
shall comply with all applicable laws, ordinances, regulations and/or deed and
plat restrictions affecting the use and occupancy of the Leased Premises. Tenant
shall not commit, or permit to be committed, any waste or nuisance on the Leased
Premises.

                                       9

<PAGE>   14
        SECTION 4.2 UTILITY CHARGES. Tenant shall be responsible for all charges
for heat, water, gas, sewer, electricity or any other utility used or consumed
in the Leased Premises including supplemental heating and charges for operation
of heating, ventilating and air conditioning equipment. If Tenant is not the
sole occupant of the Building and if utilities are not separately metered,
utility costs shall be prorated on a reasonable basis. In no event shall
Landlord be liable for an interruption or failure in the supply of any such
utilities to the Leased Premises.

        SECTION 4.3 ASSIGNMENT OR SUBLETTING. Tenant agrees not to sell, assign,
mortgage, pledge or in any manner transfer this Lease or any estate or interest
thereunder and not to sublet the Leased Premises or any part or parts thereof
without the prior written consent of Landlord in each instance which consent
shall not be unreasonably withheld. Consent by Landlord to one assignment of
this Lease or to one licensing or subletting of the Leased Premises shall not be
a waiver of Landlord's rights hereunder as to subsequent assignment or
subletting. Landlord's rights to assign this Lease are and shall remain
unqualified.

        SECTION 4.4 RULES AND REGULATIONS. The rules and regulations appended to
this Lease as Exhibit D are hereby made a part of this Lease, and Tenant agrees
to comply with and observe the same. Tenant's failure to keep and observe said
rules and regulations shall constitute a breach of the terms of this Lease in
the manner as if the same were contained herein as covenants. Landlord reserves
the right from time to time to amend or supplement said rules and regulations
and to adopt and promulgate additional rules and regulations applicable to
Leased Premises and the Expansion Property, provided that such additional rules
and regulations do not unreasonably interfere with Tenant's use and enjoyment of
the Leased Premises. Notice of such additional rules and regulations, and
amendments and supplements, if any, shall be given to

                                       10

<PAGE>   15
Tenant, and Tenant agrees thereupon to comply with and observe all such rules
and regulations and amendments thereto and supplements thereof.

        SECTION 4.5. ADA COMPLIANCE. In the event the Building, or any portion
thereof, shall be deemed a "public accommodation" under Title III of the
Americans With Disabilities Act ("ADA", 42 U.S.C. Sections 12181-12213, 47
U.S.C. Sections 225,611) the responsibilities of Landlord with Tenant with
respect to compliance with provisions of Title III of the ADA shall be as
follows:

        (a)     Initial Construction. Landlord hereby certifies that the common
                areas of the Building and all interior doorways (including door
                hardware), passageways, aisles, and exits as initially
                constructed, comply with the Accessibility Guidelines under the
                ADA.

        (b)     Barrier Removal. Tenant shall be responsible for complying with
                the "barrier removal" provisions of the ADA with respect to the
                Leased Premises. In addition, to the extent such barrier removal
                would require actions by Tenant, which actions are subject to
                Landlord's approval, Landlord shall provide such approval upon
                presentation by Tenant of evidence reasonably satisfactory to
                Landlord that such barrier removal is reasonable in scope and
                nature in-order for Tenant to fulfill its obligations under the
                ADA. To the extent any modifications or alternations by Tenant
                within the Leased Premises creates an obligation by Landlord to
                provide a "path of travel," the cost of creating such path of
                travel shall be paid entirely by Tenant.

        (c)     Auxiliary Aids and Services. Landlord shall be responsible for
                providing any required "auxiliary aids and services" in the
                common areas of the Building.

                                       11

<PAGE>   16
                Tenant shall be responsible for providing any required auxiliary
                aids and services in the Leased Premises.

        (d)     Nondiscrimination. Tenant shall comply with all of the
                nondiscrimination provisions of the ADA with respect to the
                leased Premises and its business operations.

        SECTION 4.6 SURRENDER. On the last day of the term of this Lease,
including any option term, or upon the sooner termination thereof, Tenant shall
peaceably and quietly surrender the Leased Premises and all improvements thereon
in the same condition as at the commencement of this Lease, in good order,
condition and repair, fire and other unavoidable casualty, and reasonable wear
and tear excepted. Except as provided in Section 3.5, all alterations,
additions, improvements and fixtures which may be made or installed by either
Landlord or Tenant upon the Leased Premises shall remain the property of
Landlord and shall remain upon and be surrendered with the Leased Premises as a
part thereof, without disturbance, molestation or injury at the termination of
the term of this Lease, whether by the elapse of time or otherwise, all without
compensation or credit to Tenant. Any personal property not removed shall be
deemed abandoned and shall become the property of Landlord; provided, that the
Landlord shall have the option to effect said removals and Tenant shall pay
Landlord, on demand, the cost thereof, with interest at the rate of ten (10%)
percent per annum from the date of such removal by Landlord, or the prime
interest rate established by the Firstar Bank Wisconsin or its successors or
assigns, whichever is higher.

        If, prior to surrender of the premises or within twenty (20) days
thereafter, Landlord so directs by written notice to Tenant, Tenant shall repair
any damage occasioned by such removals

                                       12

<PAGE>   17
or Tenant will pay to Landlord, on demand, the cost thereof with interest from
the date of completion of such repairs by Landlord, at the rate specified in the
immediately preceding paragraph of this Lease.

        The delivery to Landlord at the place then fixed for the payment of rent
of the keys to the Leased Premises shall constitute surrender of the premises by
Tenant and acceptance of the keys by Landlord shall constitute acceptance by
Landlord of such surrender. Such acceptance by Landlord shall not constitute a
waiver of any rights to recover damages under terms of this Lease. This method
of surrender shall not be exclusive and shall be in addition to all other
methods of surrender.

        Anything in this section to the contrary notwithstanding, at any
termination of this Lease, Landlord shall have a lien upon all of the property
of Tenant then located in or upon the leased Premises to secure the payment of
any amounts due from Tenant to Landlord by reason of this Lease or to secure the
payment of damages, and Landlord may retain possession of such property until
payment in full of said amounts. Said lien shall not be defeated by placing such
property in storage. If Tenant has not redeemed said property within ninety (90)
days after the termination of said Lease, Landlord may sell such property at
public or private sale without further notice to Tenant, and shall apply in a
reasonable manner determined by Landlord the proceeds of sale to reduce the
amounts then owed from Tenant to Landlord.

                                    ARTICLE 5

                        COMMON USE AREAS AND FACILITIES

        SECTION 5.1. COMMON AREA. The Building is part of a planned
multi-building development including Landlord's Property and the Expansion
Property. This multi-building

                                       13

<PAGE>   18
development is referred to herein as the "Project." As used herein, "common
area" shall include all of those portions of the Building and Landlord's
Property and portions of additional buildings and areas located on the Expansion
Property and designated by Landlord as part of the Project which are designed
for common use and benefit, exclusive of space designed for rental to Tenants
for commercial purposes as the same may exist from time to time. Landlord
reserves the right to construct additional buildings on the Expansion Property
as part of the Project and include the costs of maintaining the common area of
such buildings and property with the costs of the Building. Landlord also
reserves the right to develop such additional buildings on the Expansion
Property independent of the Building and not include the costs of maintaining
the common area of such buildings with the costs of maintaining the common area
of the Building. In the event Landlord does include the cost of maintaining the
common area of one or more other buildings with the cost of maintaining the
common area of the Building, the tenants of all buildings for which costs are
included shall contribute to the costs of such maintenance on the same basis.
The foregoing notwithstanding, reasonable and adequate access and parking shall
be provided for the Leased Premises and Tenant's use and enjoyment of the Leased
Premises shall not be materially adversely affected at all times.

        SECTION 5.2. USE OF COMMON AREA. Landlord hereby grants to Tenant, its
employees, agents, customers and invitees, the nonexclusive right during the
term of this Lease to use the common area, as such may from time to time be
constituted, such use to be in common with Landlord and all tenants of the
Project from time to time, their employees, agents, customers and invitees,
except when the same are being repaired.

                                       14

<PAGE>   19
        SECTION 5.3. OPERATION AND MAINTENANCE. The common area shall at all
times be subject to the exclusive control and management of Landlord and
Landlord shall manage, operate, repair and maintain the common area and its
facilities in a clean and sightly condition. The manner in which such area and
facilities shall be maintained and the expenditures therefor shall be at the
Landlord's sole discretion.

        SECTION 5.4. PREVENTING PUBLIC RIGHTS. If Landlord deems it necessary in
order to prevent the acquisition of special rights, Landlord may from time to
time close all or any portion of the common area or take such action as shall be
reasonably appropriate for that purpose.

        SECTION 5.5. CHARGE FOR COMMON AREA AND FACILITIES. During the term of
this Lease Tenant shall pay to Landlord an annual charge which shall be Tenant's
pro rata share of the Landlord's actual cost of operating, repairing, and
maintaining the common area and its facilities which shall include, but is not
limited to parking areas, landscaped and vacant areas, area-ways, drives, walks,
curbs, corridors, stairwells, gardens, sanitary and storm sewers, signs, public
facilities (such as washrooms, drinking fountains and toilets), the cost of
operating and repairing common area lighting, heating, ventilating and air
conditioning systems, cleaning, painting, removing of snow, ice and debris,
policing and inspecting, insurance for hazards and other risks, maintenance,
including but not limited to such repair of paving, curbs, walkways, driveways,
landscaping and drainage and lighting facilities as may be necessary from time
to time to keep the same in good condition and repair, a reasonable allowance
for the depreciation of maintenance equipment, a reasonable allowance for
Landlord's overhead costs in conjunction with the foregoing, and all costs and
expenses other than those of a capital nature, but excluding

                                       15

<PAGE>   20
legal fees recovered by Tenant from Landlord in any litigation relating to this
Lease. Landlord shall provide Tenant with an itemized statement of such costs
upon request.

        SECTION 5.6. FORMULA FOR PRO RATA SHARE. The annual charge for common
area maintenance and facilities shall be computed on the basis of twelve (12)
consecutive calendar months commencing and ending on dates designated by the
Landlord and shall be paid in advance in monthly installments on the first day
of each calendar month in an amount estimated by Landlord. Within sixty (60)
days after the end of each such twelve (12) month period, Landlord shall
determine and furnish to Tenant a computation of the actual amount charged for
such period; and the amounts so estimated and paid during such period shall be
adjusted promptly (including adjustments on a pro rata basis for any partial
such period at either end of the Lease term) by one party's paying to the other
whatever amount is necessary to effectuate such adjustment.

        As of the commencement date, the Tenant's pro rata share of the
Landlord's actual costs defined in this Article shall be that portion which the
area in the Leased Premises bears to the total leasable area in the Building.
After substantial completion of such additional buildings in the Project, or the
Tenant's pro rata share of the Landlord's actual costs defined in this Article
shall be that portion which the area in the Leased Premises bears to the total
leasable area in all such buildings substantially completed.

        SECTION 5.7. BASIS FOR CHANGES. Changes in any particular floor area
occurring during any calendar month shall be effective on the first day of the
next succeeding calendar month and the amounts of any floor area in effect for
the whole of any year shall be the average of the total amounts in effect on the
first day of each calendar month in such year.

                                       16

<PAGE>   21
                                   ARTICLE 6
                                   INSURANCE

        SECTION 6.1. CASUALTY INSURANCE. Landlord shall at all times during the
term of this Lease keep all improvements which are now or hereafter located on
the Landlord's Property insured against loss or damage by fire and the extended
coverage hazards at full insurance value with loss payable to Landlord,
Landlord's mortgagee and such other parties as Landlord may designate, as their
interests may appear.

        Tenant agrees to reimburse Landlord for its pro rata share of the cost
of such insurance based upon that portion of the policy year during which this
Lease is in effect. As of the commencement date, the Tenant's pro rata share of
the Landlord's actual costs shall be that portion which the area in the Leased
Premises bears to the total leasable area in the Building. After substantial
completion of any such additional buildings in the Project, or the Tenant's pro
rata share of the Landlord's actual costs shall be that portion which the area
in the Leased Premises bears to the total leasable area in all such buildings
substantially completed. Each month Tenant shall pay to Landlord an amount
equal to one-twelfth (1/12) of its pro rata share of the estimated annual
casualty insurance premium. Upon Landlord's receipt of any premium notice,
Tenant shall upon demand make up any deficiency to the extant of its pro rata
share.

        SECTION 6.2. PUBLIC LIABILITY INSURANCE. Landlord shall at all times
during the term of this Lease keep in full force and effect a policy of public
liability and property damage insurance with respect to the Landlord's Property
acrd all business operated thereon, with limits of public liability not less
than Three Million and No/100 ($3,000,000.00) Dollars for injury or death in any
one occurrence, and property damage liability insurance in the amount of Three

                                       17
<PAGE>   22

Hundred Thousand and No/100 ($300,000.00) Dollars. The policies shall name
Landlord, Tenant and Landlord's mortgagees and the lessor on the underlying
ground lease as co-insureds as their interests may appear. Upon written request
by Tenant, Landlord shall provide the Tenant with evidence of such insurance,
including identification of the Tenant as a co-insured. Landlord may from time
to time during the term of this Lease increase the above stated coverage in its
discretion. Tenant shall reimburse Landlord for its pro rata share of the cost
of such insurance in the same manner as provided in Section 6.1 regarding
casualty insurance.

        SECTION 6.3. TENANT'S CONTENTS. Tenant shall be responsible for
obtaining such insurance as it may deem advisable for all property located in
the Leased Premises. It is understood that the insurance carried by Landlord
does not cover the risk of loss or damage to Tenant's property. Tenant waives
any claim against Landlord and shall save Landlord harmless from any claim for
loss or damage to contents, merchandise, fixtures, equipment or work done by
Tenant regardless of the cause of any such damage or loss.

        SECTION 6.4. INCREASE IN FIRE INSURANCE. Tenant agrees that it will not
keep or use, in or upon the Leased Premises any article which may be prohibited
by the standard form fire insurance policy. If Tenant's use or occupancy causes
any increase in premiums for fire or casualty insurance on the Landlord's
Property, or the Leased Premises, or any part thereof, above the rate of the
least hazardous type of occupancy legally permitted in the Leased Premises,
Tenant shall pay the additional premium on such insurance. No part of such
additional premium resulting from the use or occupancy of another tenant shall
be charged to Tenant under Sections 6.1 and/or 6.2 of this Lease. The Tenant
shall also pay in such event any additional premium on any rent insurance policy
that may be carried by the Landlord for its protection against rent

                                       18
<PAGE>   23
loss through fire or other casualty. Bills for such additional premiums shall be
rendered by Landlord to Tenant at such times as Landlord may elect, and shall be
due and payable by Tenant when rendered, and the amount thereof shall be deemed
to be, and be paid as, additional rent.

        SECTION 6.5. HOLD HARMLESS. Landlord shall not be liable for any loss,
injury, death or damage to persons or property which at any time may be suffered
or sustained by Tenant or by any person whosoever may at any time be using or
occupying or visiting the Leased Premises or be in, on, or about the same,
whether such loss, injury, death, or damage shall be caused by or in any way
result from or arise out of any act, omission, or negligence of Tenant or of any
occupant, subtenant, visitor, or user of any portion of the Leased Premises, or
shall result from or be caused by any other matter or thing whether of the same
kind as or of a different kind than the matters or things above set forth, and
Tenant shall indemnify Landlord against all claims, liability, loss or damage
whatsoever on account of any such loss, injury, death, or damage. Tenant shall
indemnify Landlord against all claims, liability, loss or damage arising by
reason of the negligence or misconduct of Tenant, its agents or employees.
Tenant hereby waives all claims against Landlord for damages to the building and
improvements that are now on or hereafter placed or built on the Landlord's
Property and to the property of Tenant in, on, or about the Landlord's
Property, and for injuries to persons or property in or about the Landlord's
Property, from any cause arising at any time. The preceding sentences shall not
apply to loss, injury, death, or damage arising by reason of the negligence or
misconduct of Landlord, its agents, or employees.

        Tenant shall not be liable for any loss, injury, death, or damage to
persons or property which at any time may be suffered or sustained by third
parties, including Landlord's agents,

                                       19
<PAGE>   24

employees or contractors, or whosoever may at any time be using or occupy or
visiting portions of the Landlord's Property other than the Leased Premises, or
be in, on, or about the same, to the extent such loss, injury, death, or damage
shall be caused by or in any way result from or arise out of any act, omission,
or negligence of Landlord, its agents, employees or contractors, or of any
occupant, tenant, visitor, or user of any portion of the Landlord's Property,
other than the Leased Premises, and Landlord shall indemnify Tenant against all
claims, liability, loss, or damage whatsoever on account of any such loss,
injury, death or damage. The preceding sentence shall not apply to loss, injury,
death or damage to the extent caused by the negligence or misconduct of Tenant
or its agents, employees or contractors.

        SECTION 6.6. WAIVER OF SUBROGATION. Landlord and Tenant hereby release
each other from any and all liability or responsibility to the other (or to
anyone claiming through or under them by way of subrogation or otherwise) for
any loss or damage to property caused by fire or any of the extended coverage or
supplementary insurance contract casualties, even if such fire or other casualty
shall have been caused by the fault or negligence of the party or anyone for
whom such party may be responsible, provided, however, that this release shall
be applicable and in force and effect only in respect to loss or damage
occurring during such time as the releaser's policies shall contain a clause or
endorsement to the effect that any such release shall not adversely effect or
impair or prejudice the right of the releaser to recover thereunder. Landlord
and Tenant each agree that their policies will include such a clause or
endorsement so long as the same is obtainable and if not obtainable, shall so
advise the other in writing and such notice shall release both parties from the
obligation to obtain such a clause or endorsement.

                                       20
<PAGE>   25

                                    ARTICLE 7

                         DESTRUCTION OF LEASED PREMISES

        SECTION 7.1. DESTRUCTION OF LEASED PREMISES. If the Building is damaged
or partially destroyed by fire or other casualty to the extent of less than
one-quarter (1/4) of the then cost of replacement thereof above foundation, the
same shall be repaired as quickly as is practicable, by Landlord, except that
the obligation of Landlord to rebuild shall be limited to repairing or
rebuilding of Landlord's improvements. If the Building is so destroyed or
damaged to the extent of one-quarter (1/4) or more of the then replacement cost
thereof, then Landlord may elect not to repair or rebuild by giving notice in
writing terminating this Lease, in which event this Lease shall be terminated as
of the date of such notice.

        SECTION 7.2. REBUILDING BY LANDLORD. If Landlord shall undertake to
restore or repair the Building, it shall initiate and pursue the necessary work
with all reasonable dispatch, in a manner consistent with sound construction
methods.

        SECTION 7.3. ABATEMENT OF RENT UPON DESTRUCTION OF PREMISES. If such
damage or partial destruction renders the Leased Premises wholly untenantable,
the base rent shall abate until the Leased Premises have been restored and
rendered tenantable. If such damage or partial destruction renders the premises
untenantable only in part, the base rent shall abate proportionately as to the
portion of the Leased Premises rendered untenantable. Rent shall not abate under
this section if the damage or destruction is caused by the negligence or
misconduct of Tenant, its agents, employees, customers or invitees.

                                       21
<PAGE>   26

                                    ARTICLE 8
                             EFFECT OF CONDEMNATION

        SECTION 8.1. TOTAL CONDEMNATION. In the event that the Leased Premises
or such part of the Leased Premises as will render the remainder untenantable,
shall be appropriated or taken under the power of eminent domain by any public
or quasi-public authority, this Lease shall terminate and expire as of the date
of taking.

        SECTION 8.2. PARTIAL CONDEMNATION. In the event of partial condemnation,
not rendering the remainder of the Leased Premises untenantable or significantly
impairing the operation of Tenant's business, this Lease shall remain in full
force and effect, with the exception that the base rent shall be reduced in
proportion to the area of the Leased Premises lost by condemnation.

        SECTION 8.3. LANDLORD'S DAMAGES. In the event of any condemnation or
taking, whether whole or partial, the Tenant shall not be entitled to any part
of the award paid for such condemnation and Landlord is to receive the full
amount of such award, the Tenant hereby expressly waiving any rights or claim to
any part thereof.

        SECTION 8.4. TENANT'S DAMAGES. Although all damages in the event of any
condemnation are to belong to the Landlord whether such damages are awarded as
compensation for diminution in value of the leasehold or to the fee of the
Leased Premises, Tenant shall have the right to claim and recover from the
condemning authority, but not from Landlord, such compensation as may be
separately awarded or recoverable by Tenant in Tenant's own right on account of
any and all damage to Tenant's business by reason of the condemnation, and for
or on account of any cost or loss to which Tenant might be put in removing
Tenant's property.

                                       22
<PAGE>   27

                                   ARTICLE 9
                                    REMEDIES

        SECTION 9.1. EVENTS OF DEFAULT BY TENANT. Upon the failure by Tenant to
pay rent when due, Landlord may terminate this Lease or Tenant's right to use
and occupy the Leased Premises by ten (10) days' written notice to Tenant unless
Tenant within such ten (10) days pays all rent due. Upon the happening of any
one or more of the following events: (a) the levying of a writ of execution or
attachment on or against the property of Tenant; (b) the taking of any action
for the voluntary dissolution of Tenant; (c) the commencement of a mechanic's
lien foreclosure action against Tenant as a result of a mechanic's lien or claim
therefor against the land or Building of which the Leased Premises are a part;
and (d) the failure of Tenant to perform any other of the terms, provisions, and
covenants of this Lease, Landlord may terminate this Lease or Tenant's right to
use and occupy the Leased Premises by thirty (30) days' written notice to Tenant
unless Tenant, within such thirty (30) day period, cures the specified default
or, if the default is of a character which cannot be cured within thirty (30)
days, the Tenant commences and diligently pursues the cure of such default
within thirty (30) days.

        SECTION 9.2. RE-ENTRY BY LANDLORD. Upon such termination of the Lease or
termination of Tenant's right to use and occupy the Leased Premises as
aforesaid, or if Tenant at any time during the term of this Lease vacates the
premises or ceases operating said business in the entire or any appreciable part
of the Lid Premises, except for causes beyond its control, Landlord may reenter
the Leased Premises.

        SECTION 9.3. RIGHT TO RELET. Should Landlord elect to reenter, as herein
provided, or should it take possession pursuant to legal proceedings or pursuant
to any notice provided for

                                       23
<PAGE>   28

by law, it may either terminate this Lease or it may from time to time without
terminating this Lease, make such alterations and repairs as may be necessary in
order to relet the Leased Premises, and relet the Leased Premises or any part
thereof for such term or terms (which may be for a term extending beyond the
term of this Lease) and at such rental or rentals upon such other terms and
conditions as Landlord in its sole discretion may deem advisable upon each such
reletting. All rentals received by the Landlord from such reletting shall be
applied, first, to the payment of any indebtedness other than rent due hereunder
from Tenant to Landlord; second, to the payment of any costs of such alterations
and repairs; third, to the payment of rent due and unpaid future rent as the
same may become due and payable hereunder. If such rentals received from such
reletting during the month be less than that to be paid during that month by
Tenant hereunder, Tenant shall pay any such deficiency to Landlord. Such
deficiency shall be calculated and paid monthly. No such re-entry or taking
possession of said premises by Landlord shall be construed as an election in its
part to terminate this Lease unless a written notice of such intention be given
to Tenant or unless the termination thereof be decreed by a court of competent
jurisdiction. Notwithstanding any such reletting without termination, Landlord
may at any time thereafter elect to terminate this Lease for such previous
breach. Should Landlord at any time reenter or terminate this Lease for any
breach, in addition to any other remedies it may have, it may recover from
Tenant all damages it may incur by reason of such breach, including the cost of
recovering the Leased Premises and reasonable attorney's fees. All of which
amounts shall be immediately due and payable from Tenant to Landlord.

        SECTION 9.4. PARTIES MAY REMEDY DEFAULTS. In the event of any breach
hereunder by either party, and in lieu of Landlord's terminating this Lease as
herein provided, Landlord or

                                       24
<PAGE>   29

Tenant respectively may immediately or at any time thereafter, after having
given the other party the requisite notice to correct the same and that time for
such correction having elapsed, cure such breach for the account and at the
expense of the other party. If Landlord or Tenant at any time, by reason of such
breach, is compelled to pay, or elects to pay, any sum of money or do any act
which will require the payment of any sum of money, or incurs any expense,
including reasonable attorney's fees, in instituting or prosecuting any action
or proceeding to enforce such party's rights hereunder, the sum or sums so paid
or incurred by such party, if paid or incurred by Landlord, shall be deemed to
be additional rent hereunder and shall be due from Tenant to Landlord on the
first day of the month following the payment of such respective sums, and if
paid or incurred by Tenant, shall be due and payable by Landlord on demand
without interest. This option given to the parties is intended for their
protection and its existence shall not release the parties from the obligation
to perform the terms and covenants herein provided to be performed by the
respective parties or deprive Landlord of any legal rights which it may have by
reason of any default of Tenant.

        SECTION 9.5. LANDLORD'S REMEDIES: LIQUIDATED DAMAGES. In the event that
at any time, whether before or after the commencement of the term hereof, a
bankruptcy petition shall be filed by Tenant or against Tenant and Tenant shall
thereafter be adjudicated a bankrupt, or such petition shall be approved by the
court, in any court or pursuant to any statute either of the United States or of
any State, whether in bankruptcy, insolvency, for reorganization under Chapter
XI or XIII of the Bankruptcy Act or under any other provisions of the Bankruptcy
Act, or under the provisions of any law of like impact, for the appointment of a
receiver or trustee of Tenant or for the property of Tenant, or if Tenant shall
make an assignment of Tenant's

                                       25
<PAGE>   30

property for the benefit of its creditors, or if proceedings are instituted in a
court of competent jurisdiction for the reorganization, liquidation or
involuntary dissolution of Tenant, then immediately upon the happening of any
such event, and without any entry or other act by Landlord, this Lease and the
term and estate hereby granted (whether or not the term shall therefore have
commenced) shall expire, terminate and come to an end in the same manner and
with the same force and effect as if the date of such occurrence were the date
hereinbefore fixed for the expiration of the term hereof. In the event of the
termination of the term hereof by the happening of any such event, Landlord
shall forthwith upon such termination, and any other provisions of this Lease to
the contrary notwithstanding, become entitled to recover as and for liquidated
damages caused by such breach of the provisions of this Lease an amount equal to
the difference between the then cash value of the rent reserved hereunder for
the unexpired portion of the demised term and the then cash rental value of the
Leased Premises for such unexpired portion of the term hereby demised unless the
statute which governs or shall govern the proceeding in which such damages are
to be provided limits or shall be entitled to prove as and for liquidated
damages an amount equal to that allowed by or under such statute. The provision
of this paragraph shall be without prejudice to Landlord's right to prove in
full damages for rent accrued prior to the termination of this Lease but not
paid. This provision of this Lease shall be without prejudice of any rights
given Landlord by any pertinent statute to prove any amounts allowed thereby. In
making such computation, the then cash rental value of the Leased Premises shall
be deemed prima facie to be the rent realized upon any reletting, if such
reletting can be accomplished by Landlord within a reasonable time after such a
termination of this Lease.

                                       26
<PAGE>   31

        SECTION 9.6. EXPENSES OF LANDLORD. Upon the occurrence of an event of
default, notwithstanding anything herein to the contrary and whether or not
Landlord terminates this Lease, Tenant shall promptly, upon request, reimburse
Landlord for all costs and expenses reasonably incurred in enforcing this Lease,
including reasonable attorneys' fees.

        SECTION 9.7. WAIVER OF REDEMPTION. Tenant hereby expressly waives any
and all rights of redemption granted by or under any present or future laws in
the event of Tenant's being evicted or dispossessed for any cause, or in the
event of Landlord's obtaining possession of the Leased Premises, by reason for
the violation by Tenant of any of the covenants or conditions of this Lease, or
otherwise.

        SECTION 9.8. DEFAULTS OF LANDLORD. Should Landlord be in default under
the terms of this Lease, Landlord shall cure such default within thirty (30)
days after written notice of such default from Tenant, or in the event such
default is of such a character as to require more than thirty (30) days to cure,
Landlord shall use due diligence to cure such default.

        SECTION 9.9. RIGHTS CUMULATIVE. All rights and remedies of Landlord and
Tenant herein enumerated shall be cumulative and none shall exclude any other
right or remedy allowed by Law, and said rights and remedies may be exercised
and enforced concurrently and whenever and as often as occasion therefor arises.

                                   ARTICLE 10

                                 MISCELLANEOUS

        SECTION 10.1. SUBORDINATION. At Landlord's option, this Lease shall be
subordinated to any existing mortgages covering the Leased Premises, any
extension or renewal thereof, or to any new mortgages which may be placed
thereon from time to time, provided, however,

                                       27
<PAGE>   32

anything to the contrary contained herein notwithstanding, every such mortgage
shall contain a provision that the mortgagee shall recognize the validity of
this Lease in the event of foreclosure of the Landlord's interest so long as
Tenant shall not be in default under the terms of this Lease. Tenant shall
execute whatever instruments may be required to effect such subordination.

        SECTION 10.2. SALE OF LANDLORD'S INTEREST. Prior to a transfer by
Landlord of its interest in the Premises and this Lease, the following shall
occur:

        (a)     First Right. In the event Landlord determines to dispose of its
                interest in the Premises and this Lease, Landlord shall notify
                Tenant in writing of its intention and shall offer to sell the
                Premises to Tenant at the price and on terms stated in such
                notice. Tenant shall have sixty (60) days in which to accept or
                decline such offer. If Tenant fails to accept Landlord's offer
                in writing within such period, Landlord may then sell the
                Premises, subject to (b) below, to a third party.

        (b)     Right of First Refusal. In the event Landlord shall receive from
                a third party at any time during the term of this lease, or any
                extension thereof, a bona fide offer to purchase the Building or
                Landlord's Property, which offer Landlord desires to accept,
                Landlord shall promptly give to Tenant notice thereof
                accompanied by an affidavit setting out the full terms of such
                offer and Landlord's desire to sell for the price and on the
                terms offered. Tenant shall have the right of first refusal to
                purchase the property described in such offer at such price and
                on such terms. Tenant may exercise said right of first refusal
                by giving Landlord written notice of Tenant's election to do so
                within sixty (60) days of Tenant's receipt of said notice and
                affidavit. If Tenant shall not so elect within said period of
                sixty (60)

                                       28
<PAGE>   33

                days, Landlord may then sell the property described in the
                offer, subject to this Lease, but excluding this right of first
                refusal, to such third party on the terms and conditions and for
                the price set forth in the said notice and affidavit to Tenant.
                Landlord shall complete such sale within 180 days of the date of
                the notice and affidavit or the terms of this paragraph (b)
                shall apply again to such sale.

        (c)     Scope and Limitations. The rights of Tenant in this Section 10.2
                shall be cumulative and consecutive. Tenant's first right and
                right of first refusal shall only apply to a separate and
                individual transfer of the Building to an unrelated third party
                not affiliated or in anyway benefiting the University of
                Wisconsin. Tenant's right of first refusal and first right shall
                not apply to a transfer necessary to maintain Landlord's tax
                exempt status, or as part of a transfer of all or substantially
                all of Landlord's interest in all land in the University
                Research Park. However, any subsequent transfer not to such an
                entity or not for a similar purpose shall be subject to Tenant's
                rights.

        (d)     Effect of Sale. Upon any sale, transfer or conveyances, Landlord
                shall cease to be liable under any covenant, condition or
                obligation imposed upon it by this Lease, or any of the terms
                and provisions thereof; provided, however, that any such sale,
                transfer or conveyance not to Tenant shall be subject to this
                Lease and that all of the Landlord's covenants and obligations
                contained herein shall be binding upon the subsequent owner or
                owners thereof; and provided further that

                                       29
<PAGE>   34

                such transferee from Landlord shall in writing assume the
                obligations of Landlord hereunder.

        SECTION 10.3. OFFSET STATEMENT. Within ten (10) days after request
therefor by Landlord, or in the event that upon any sale, assignment or
hypothecation of the Leased Premises and/or all or any portion(s) of the
Landlord's Property by Landlord an offset statement shall be required by Tenant;
Tenant agrees to deliver in recordable form a certificate to any proposed
mortgagee or purchaser, or to Landlord, certifying (if such be the case) that
thus Lease is in full force and effect and that there are no defenses or offsets
thereto, or stating those claimed by Tenant.

        SECTION 10.4. ATTORNMENT. Tenant shall, in the event any proceedings are
brought for the foreclosure of, or in the event of exercise of the power or sale
under any mortgage made by the Landlord covering the Leased Premises, attorn to
the purchaser upon any such foreclosure or sale and recognize such purchaser as
the Landlord under this Lease.

        SECTION 10.5. RECORDING. Tenant shall not record this Lease without the
written consent of Landlord; however, upon the request of either party hereto
the other party shall join in the execution of memorandum or so called "short
form" of this Lease for the purpose of recordation. Said memorandum or short
form of this Lease shall describe the parties, the Leased Premises and the term
of this Lease and shall incorporate this Lease by reference.

        SECTION 10.6. EXCAVATIONS. In case any excavation shall be made for
buildings or improvements or for any other purpose upon the land adjacent to or
near the Leased Premises, Tenant will afford to Landlord, or the person or
persons, firms or corporations causing or making such excavation, license to
enter upon the Leased Premises for the purpose of doing such

                                       30
<PAGE>   35

work as Landlord or such person or persons, firms or corporations shall deem to
be necessary to preserve the walls or structures of the building from injury,
and to protect the building by proper securing of foundations. Insofar as
Landlord may have control over the same, all such work shall be done in a manner
as will not materially interfere with the operation of Tenant's business in the
Leased Premises.

        SECTION 10.7. ACCESS TO PREMISES. Landlord reserves for itself and the
landlord under the underlying ground lease, the right to enter upon the Leased
Premises at all reasonable hours, upon reasonable advance notice, for the
purpose of inspecting the same, or of making repairs, additions or alterations
to the building in which the Leased Premises are located, to exhibit the Leased
Premises to prospective tenants, purchasers or others, to display during the
last ninety (90) days of the term, without hindrance or molestation by Tenant,
"For Rent" or similar signs on the exterior of the Leased Premises. The exercise
by Landlord of any of its rights under this provision shall not be deemed an
eviction or disturbance of Tenant's use and possession of the Leased Premises.

        SECTION 10.8. QUIET ENJOYMENT. If and so long as Tenant pays the rent
reserved by this Lease and performs and observes all of the covenants and
provisions hereof, Tenant shall quietly enjoy the Leased Premises, subject,
however, to the terms of this Lease.

        SECTION 10.9. NOTICES. Any notice required or permitted under this Lease
shall be deemed sufficiently given or served if sent by certified mail to Tenant
at the address of the Leased Premises, and to Landlord at its office or such
other place as it may designate in writing, and either party may by like written
notice at any time and from time to time designate a

                                       31
<PAGE>   36

different address to which notices shall subsequently be sent. Notices given in
accordance with these provisions shall be deemed received when mailed.

        SECTION 10.10. HOLDING OVER. In the event Tenant remains in possession
of the leased Premises after the expiration of this Lease and without the
execution of a new Lease, it shall be deemed to be occupying said premises as a
Tenant from month-to-month, subject to all conditions, provisions and
obligations of this Lease insofar as the same are applicable to a month-to-month
tenancy. Nothing in this section shall operate to preclude Landlord from
removing Tenant from the Leased Premises upon the expiration of this Lease.

        SECTION 10.11. CONSENTS BY LANDLORD. Whenever under this Lease provision
is made for Tenant securing the written consent or approval of Landlord, such
consent or approval will not be unreasonably withheld.

        SECTION 10.12. SUCCESSORS AND ASSIGNS. The terms, covenants and
conditions hereof shall be binding upon and inure to the successors in interest
and assigns of the parties hereto.

        SECTION 10.13. GOVERNMENTAL REGULATIONS. Tenant shall, at Tenant's sole
cost and expense, comply with all of the requirements of all city, county,
municipal, state, federal and other applicable governmental authorities, now in
force, or which may hereafter be in force, pertaining to signs, installations,
repairs and business operations in the Leased Premises and shall faithfully
observe all statutes now in force or which may hereafter be in force.

        SECTION 10.14. CERTAIN EXPENSES OF LANDLORD. Any out-of-pocket expenses
reasonably insured by Landlord for purposes of considering or acting upon any
request for consent or waiver under, or modification of, any of the provisions
of this Lease, including reasonable attorney's fees, shall be promptly
reimbursed by Tenant upon Landlord's request.

                                       32
<PAGE>   37

        SECTION 10.15. FORCE MAJEURE. In the event that either Landlord or
Tenant shall be delayed or hindered in or prevented from the performance of any
act required hereunder by reason of strikes, lock outs, labor disputes,
inability to procure materials, failure of power, restrictive governmental laws
or regulations, riots, insurrection, war or other reason of alike nature not
attributable to the negligence or fault of the party delayed in performing work
or doing acts required under the terms of this Lease, then performance of such
act shall be excused for the period of the unavoidable delay and the period for
the performance of any such act shall be extended for an equivalent period.
Provided, however, that this provision shall not operate to excuse Tenant from
the timely payment of rent and other payments required by the terms of this
Lease.

        SECTION 10.16. GENERAL. Nothing contained in this Lease shall be deemed
or construed by the parties hereto or by any third party to create the
relationship of principal and agent or of partnership or of joint venture or of
any association between Landlord and Tenant, it being expressly understood and
agreed that neither the method of computation of rent nor any other provisions
contained in this Lease nor any acts of the parties hereto shall be deemed to
create any relationship between Landlord and Tenant other than the relationship
of landlord and tenant. No waiver of any default of Tenant or Landlord hereunder
shall be implied from any omission by Landlord or Tenant any action on account
of such default if such default persists or is repeated, and no express waiver
shall affect any default other than the default specified in the express waiver
and that only for the time and to the extent therein stated. One or more waivers
of any covenant, term or condition of this Lease by Landlord or Tenant shall not
be construed as a waiver of a subsequent breach of the same covenant, term or
conditions. The consent or

                                       33
<PAGE>   38

approval by Landlord to or of any act by Tenant requiring the Landlord's consent
or approval shall not be deemed to waive or render unnecessary Landlord's
consent or approval to or of any subsequent similar act by Tenant. The
invalidity or unenforceability of any provision hereof shall not affect or
impair any provision. The plural sense where there is more than one tenant and
to either corporations, associations, partnership or individuals, male or
females, shall in all instances be assumed as though in each case fully
expressed. The laws of the State of Wisconsin shall govern the validity,
performance and enforcement of this Lease. The submission of this Lease for
examination does not constitute a reservation of or option for the Leased
Premises and this Lease becomes effective as a Lease only upon execution and
delivery thereof by Landlord and by Tenant. The headings contained herein are
for convenience only and do not define, limit or construe the contents of the
provisions hereof. All negotiations, representations and understandings between
the parties are incorporated herein and may be modified or altered only by
agreement in writing between the parties.

        SECTION 10.17. EFFECT OF GROUND LEASE. Tenant acknowledges that Landlord
is presently leasing Landlord's Property under a ground lease having a term
equal to or greater than the term of this Lease. Tenant further acknowledges
that all of its rights under this Lease are specifically subordinate to the
rights of the landlord named in said ground lease and its successors and
assigns.

                                   ARTICLE 11

                                  ATTACHMENTS

        SECTION 11.1. ATTACHMENTS. The following are attached hereto and made a
part hereof with the same force and effect as if set forth in full herein:

                                       34
<PAGE>   39

        Exhibit A: Legal Description of Landlord's Property.

        Exhibit B: Location of Building

        Exhibit C: Plans and Specifications.

        Exhibit D: Rules and Regulations.

        IN WITNESS WHEREOF, Landlord and Tenant have executed this Lease and
affixed their respective seals as of the day, month and year first above
written.

LANDLORD:                                     TENANT:
UNIVERSITY RESEARCH PARK                      THIRD WAVE TECHNOLOGIES, INC.
FACILITIES CORP.

By: /s/ WAYNE F. McGOWN                       By:  [SIGNATURE ILLEGIBLE]
    ------------------------------                ------------------------------
    Wayne F. McGown, Assistant
    Secretary/Treasurer                       Title: President & CEO

Date: 4/1/97                                  Dated: 3-21-97
      ----------------------------                   ---------------------------

                                       35
<PAGE>   40

                                   EXHIBIT A

                              [PROPERTY FLOOR PLAN]
<PAGE>   41

                                    EXHIBIT B

                                    LOCATION

        Strang Project No. 97-007, Site Plan dated March 17, 1997, Sheet
A1.1-A1.S and A2.1-A2.3.

<PAGE>   42

                                     EXHIBIT C

                           PLANS AND SPECIFICATIONS

        Strang Project No. 97-007, dated March 17, 1997, Tenant Improvement
Reference Plans, Sheets A9.1 and A9.2.

<PAGE>   43

                                    EXHIBIT D

                              RULES AND REGULATIONS

        None adopted.

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