MASTER COLLABORATION AGREEMENT



                                    BETWEEN



                              DIVERSA CORPORATION



                                      AND



                            THE DOW CHEMICAL COMPANY
<PAGE>

                               TABLE OF CONTENTS


<TABLE>
<CAPTION>
             Article                              Title                                Page
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        <S>                                <C>                                  <C>
               1                               Definitions                              1
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               2                                 Grants                                 6
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               3                           Project Agreements                           8
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               4                      Royalties, Reports and Payments                   10
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               5                             Confidentiality                            12
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               6                               Publication                              13
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               7                          Intellectual Property                         14
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               8                            Option to [***]                             18
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               9                         Term and Disengagement                         18
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              10                         Product Liability and                          19
                                           Indemnification
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              11                    Export and Compliance with Laws                     20
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              12                          Dispute Resolution                            20
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              13                     Representations and Warranties                     21
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              14                             Bankruptcy                                 22
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              15                           Force Majeure                                23
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              16                      Assignment and Successors                         23
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              17                              Notice                                    23
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              18                          Miscellaneous                                 24
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</TABLE>


<TABLE>
<CAPTION>
                     Exhibits                                               Title
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                 <C>                                    <S>
                          1                                  Confidential Disclosure Agreement
---------------------------------------------------------------------------------------------------------
                          2                                                [***]
---------------------------------------------------------------------------------------------------------
</TABLE>
-----------------
* CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

                                       Project Agreements*
<TABLE>
<CAPTION>

                Appendix                                               Title
---------------------------------------------------------------------------------------------------------
       <S>                                      <C>
                  A-1                             Schedule of DIVERSA Patent Rights under the Project
                                                                    Agreement
---------------------------------------------------------------------------------------------------------
                  A-2                              Schedule of DIVERSA Patent Rights predate this MCA
                                                     and Project Agreement but needed for Licensed
                                                                      Products
---------------------------------------------------------------------------------------------------------
                  B-1                              Schedule of TDCC Patent Rights under the Project
                                                                     Agreements
---------------------------------------------------------------------------------------------------------
                  B-2                              Schedule of TDCC Patent Rights that predate this
                                                  MCA and Project Agreement, but needed for Licensed
                                                                       Product
---------------------------------------------------------------------------------------------------------
                   C                                  List of Licensed Enzyme and Project Field
---------------------------------------------------------------------------------------------------------
                  D-1                                            MTA for an Institute
---------------------------------------------------------------------------------------------------------
                  D-2                                        MTA for a Toll Manufacturer
---------------------------------------------------------------------------------------------------------
                  D-3                                            MTA for a Customer
---------------------------------------------------------------------------------------------------------
                  E                                                     [***]
---------------------------------------------------------------------------------------------------------
                  F                                Schedule of Licensed Patents from DIVERSA Patent
                                                    Rights for a Licensed Product (subset or all of
                                                                     Appendix A-1)
---------------------------------------------------------------------------------------------------------
</TABLE>

* Will be provided as each Project Agreement is signed
-----------------------------
* CONFIDENTIAL TREATMENT REQUESTED


                                       2

<PAGE>

                        MASTER COLLABORATION AGREEMENT

This Agreement ("MCA") is made by and between Diversa Corporation, a corporation
duly formed and existing under the laws of the State of Delaware, having a place
of business at 10665 Sorrento Valley Road, San Diego, CA 92121 (hereinafter
"DIVERSA" or "Party"), and The Dow Chemical Company, a corporation duly formed
and existing under the laws of the State of Delaware, having a place of business
at 2030 Dow Center, Midland, MI 48674 (hereinafter "DOW" or a "Party").

                                R E C I T A L S

A.   DIVERSA has discovered and developed enzymes and has expertise in the
     rearrangement of DNA to produce and discover genes utilizing proprietary
     technologies for the rapid discovery, development and optimization of
     enzymes.

B.   TDCC has a contract manufacturing business for preparing pharmaceutical
     products for the pharmaceutical industry.

C.   TDCC and DIVERSA desire to work together to discover, manufacture, market
     and sell biological enzyme-based chiral products and services for
     pharmaceutical applications.

D.   TDCC and DIVERSA are concurrently with this MCA entering into separate
     Project Agreements in order to perform research together to have DIVERSA
     discover and optimize the function of new genes, and to have TDCC develop
     and maximize processes and products for making chiral products resulting
     therefrom for use in the pharmaceutical marketplace.

E.   DIVERSA represents that it has Patent Rights and Know-How that pertain to
     this MCA.

F.   TDCC is desirous of obtaining, and DIVERSA wishes to grant, a worldwide
     license to sell enzymes discovered or developed by DIVERSA for making
     chiral compounds for the pharmaceutical marketplace.


NOW, THEREFORE, in consideration of the mutual covenants contained herein, and
for other good and valuable consideration, the receipt and sufficiency of which
the Parties hereby acknowledge, the Parties hereby agree as follows:

                            Article 1.  DEFINITIONS

When used in this MCA, the following terms shall have the meanings set out
below, unless the context requires otherwise.  The singular shall be interpreted
as including the plural and vice versa, unless the context clearly indicates
otherwise.

1.1  "Affiliate" means any corporation, firm, limited liability company,
      ---------
     partnership or other entity that is directly or indirectly controlled by a
     Party. Control for this purpose means ownership, directly or through one or
     more affiliated entities, of greater than fifty percent (50%) of the shares
     of stock entitled to vote for the election of directors in the case of a
     corporation, or more than fifty percent (50%) of the equity interests in
     the case of any other type of legal entity, or any other arrangement
     whereby a Party controls or has the
<PAGE>

     right to control the board of directors or equivalent governing body of a
     corporation or other entity.

1.1  "API" means [***].
      ---

1.2  "CDA" means the Confidentiality Agreement between the Parties, effective
      ---
     February 23, 1999 and its amendment effective May 16, 2000.  For ease of
     reference a copy thereof is attached hereto as Exhibit 1.

1.3  "Change of Control" means any of the following transactions involving a
      -----------------
     Third Party:
     a)   a merger or consolidation of either Party which results in the voting
          securities of such Party outstanding immediately prior thereto ceasing
          to represent more than 50% of the combined voting power of the
          surviving entity immediately after such merger or consolidation;
     b)   the sale of all or substantially all of the assets of either Party;
     c)   the sale of substantially all the assets relevant to the Field; or
     d)   any one person (other than the Party, any trustee or other fiduciary
          holding securities under an employee benefit plan of the Party or any
          corporation owned directly or indirectly by the stockholders of the
          Party, in substantially the same proportion as their ownership of
          stock of the Party), together with any of such person's "affiliates"
          or "associates", as such terms are used in the Securities Exchange Act
          of 1934, as amended, becoming beneficial owner of more than 50% of the
          combined voting power of the outstanding securities of a Party or by
          contract or otherwise having the right to control the board or
          directors or equivalent governing body of such Party nor the ability
          to cause the direction of management of such Party.

1.4  "Confidential Information" means all information which the disclosing Party
      ------------------------
     could reasonably expect to be deemed confidential (e.g., TDCC Know-How,
     DIVERSA Know-How, scientific, technical, or non-technical data,
     Intermediates, APIs, business plans, identity of a Sublicensee, financial
     projections, and marketing and sales information) disclosed by one Party to
     the other, whether disclosed or provided in oral, written (including but
     not limited to electronic, facsimile, paper or other means), graphic,
     photographic or any other form, except to the extent that such information:
     a)   as of the date of disclosure is known to the receiving Party as shown
          by written documentation, other than by virtue of a prior confidential
          disclosure from the disclosing Party to the receiving Party;
     b)   as of the date of disclosure is in, or subsequently enters, the public
          domain through no fault or omission of the receiving Party;
     c)   as of the date of disclosure or thereafter is obtained from a Third
          Party free from any obligation of confidentiality; or
     d)   as of the date of disclosure or thereafter is developed by the
          receiving Party independent of the disclosure by the disclosing Party
          as evidenced by written documentation.

     Any information first submitted to the other Party in a non-written form
     must be identified as confidential information at that time, then reduced
     to writing within thirty (30) days, marked as confidential and provided to
     the receiving Party.

1.5  "Controls" or "Controlled" means, with respect to intellectual property,
      --------      ----------
      possession (other than by virtue of this MCA) of the ability to grant
      licenses or sublicenses to the other Party hereto or to its Sublicensee
      without violating the terms of any agreement or other arrangement with any
      Third Party and to the knowledge and belief of the granting Party without
      violating the rights of a Third Party.

--------------------
* CONFIDENTIAL TREATMENT REQUESTED

                                       2
<PAGE>

1.6   "Customers" means any entity that is only sold Licensed Enzyme,
       ---------
      Intermediates or API for pharmaceutical applications and is not provided
      process information and is not a Sublicensee.

1.7   "DIVERSA" means Diversa Corporation, having a place of business at San
       -------
      Diego, California.

1.8   "DIVERSA Know-How" means all [***] and any other information of any kind
       ----------------
      (a) which are conceived, discovered or invented during any Project
      Agreement under the terms of this MCA or (b) which have been conceived,
      discovered or invented by DIVERSA prior to this MCA and Controlled solely
      by DIVERSA, which are necessary or appropriate to develop and
      commercialize Licensed Products.

1.9   "DIVERSA Intellectual Property" means DIVERSA Patent Rights and DIVERSA
       -----------------------------
      Know-How.

1.10  "DIVERSA Patent Rights" means (a) all patents and patent applications
       ---------------------
      which are conceived of during the term of the Project Agreements, and
      which are necessary for [***]. If such patent rights arise they shall be
      listed on Appendix A-1, attached to each Project Agreement and made a part
      thereof; (b) the patents and patent applications listed on Appendix A-2,
      attached thereto and made a part thereof, are patent rights of DIVERSA
      that predate this MCA but which patent rights are necessary for [***]; and
      (c) any divisions, continuations, continuations-in-part, reissues,
      reexaminations, extensions or other governmental actions which extend any
      of the subject matter of the patent applications or patents in (a) or (b)
      above, and any substitutions, confirmations, patents-of-addition,
      registrations or revalidations of any of the foregoing, in each case,
                                                              ------------
      which are Controlled by DIVERSA during the term of the Project Agreements
      and which are necessary for [***]. All patents and patent applications
      subject to this definition are listed on Appendix A or will be included on
      Appendix A attached to each Project Agreement by the expiration of the
      research term of each Project Agreement.

1.11  "Effective Date" means September 1, 2000.
       --------------

1.12  "Enzyme" means [***].
       ------

1.13  "Field" means the discovery, development, manufacture, marketing and sale
       -----
      of Licensed Products, [***]and services for [***] used in [***].

1.14  "FTE" means the equivalent of one full year of work on a full time basis
       ---
      by a DIVERSA scientist or other professional possessing the skills and
      experience necessary to carry out the Work Plans under a Project
      Agreement. It is understood that a full year for any given scientist or
      professional may not be required so that partial years for any given
      person could result. FTE needs shall form a part of the Staffing Level of
      each Project Agreement.

1.15  "Intermediate" means [***].
       ------------

1.16  "Joint Patent Rights" means Patent Rights that are developed or invented
       -------------------
      by both Parties in the course of the performance of any Project Agreement.
      If the item developed or invented results in a patentable invention, such
      invention is jointly developed if both Parties' employees or consultants
      are considered inventors under 35 U.S.C. et seq. and

-----------------------
* CONFIDENTIAL TREATMENT REQUESTED

                                       3
<PAGE>

      37 C.F.R. et seq., as interpreted by the U. S. Patent and Trademark Office
      and the United States Federal Courts.


1.17  "License" means the license agreement(s) attached to each Project
       -------
      Agreement as Exhibit 4 thereto.

1.18  "Licensed Enzyme" means any Enzyme, which is commercialized under this
       ---------------
      MCA, for use in a Project Field. The Licensed Enzyme and Project Field
      shall be designated on each Project Agreement and listed in Appendix C
      attached thereto and made a part thereof.

1.19  "Licensed Product" means (a) [***] or (b) [***].
       ----------------

1.20  "Licensed Patents" means DIVERSA Patent Rights that are necessary to have
       ----------------
      the freedom to practice Licensed Products and are indicated on Appendix F
      attached to each Project Agreement and made a part thereof. It is expected
      that such Licensed Patents will be all or a subset of the DIVERSA Patent
      Rights listed in Appendix A with each Project Agreement.

1.21  "MTA" means a material transfer agreement for exchange of any Licensed
       ---
      Enzyme (with or without DIVERSA Know-How or TDCC Know-How) to any Third
      Party by DIVERSA or TDCC, a copy of which is attached hereto as Appendix D
      for transfer between TDCC or DIVERSA and a Third Party.  Appendix D-1 for
      an Institute; Appendix D-2 for a Toll Manufacturer; and Appendix D-3 for a
      Customer.  Any MTA shall be used only under the terms of a Project
      Agreement.  Any transfer of Enzymes or Licensed Enzymes between TDCC and
      DIVERSA shall be deemed Confidential Information (provided under the
      confidentiality provisions of this MCA) and not require an MTA.

1.22  "Patent Rights" means DIVERSA Patent Rights, TDCC Patent Rights and Joint
       -------------
      Patent Rights.

1.23  "Project Agreements" means each individually executed agreement detailing
       ------------------
      a specific research objective in the Project Field, budget with FTE
      requirements, and Work Plan, that is attached hereto and made a part
      hereof and incorporating the terms of this MCA that are referenced
      therein. One Project Agreement shall be signed within 60 days of this MCA;
      and other Project Agreements may be appended at any time during the Term
      of this MCA.

1.24  "Project Field" means a [***].
       -------------

1.25  "Purpose" means having the Parties provide an integrated, full service
       -------
      offering of [***] to Customers.  This service and Licensed Products may be
      offered as early as [***].  Specifically excluded from this Purpose is the
      identification of [***].

1.26  "Signature Date" means the date of last signature to this MCA.
       --------------

1.27  "Staffing Level" shall have the meaning set forth in each Project
       --------------
      Agreement.

1.28  "Sublicensee" means a Third Party that has a license agreement with TDCC
       -----------
      in the Project Field for Licensed Products.

1.29  "TDCC" means The Dow Chemical Company, having a place of business at
       ----
      Midland, Michigan.

-----------------------
* CONFIDENTIAL TREATMENT REQUESTED

                                       4
<PAGE>

1.30  "TDCC Intellectual Property" means TDCC Patent Rights and TDCC Know-How.
       --------------------------

1.31  "TDCC Know-How" means all TDCC Confidential Information [***] and other
       -------------
      information of any kind (a) which are conceived, discovered or invented
      during any Project Agreement under the terms of this MCA or (b) which have
      been conceived, discovered or invented by TDCC prior to this MCA and
      Controlled solely by TDCC, which are necessary or appropriate to develop
      and commercialize Licensed Products.

1.32  "TDCC Patent Rights" means (a) all patents and patent applications which
       ------------------
      are conceived of during the term of the Project Agreements, and which are
      necessary for TDCC to make, have made, use, import, sublicense, export,
      sell or have sold the Licensed Products. If such patent rights arise they
      shall be listed on Appendix B-1, attached to each Project Agreement and
      made a part thereof; (b) the patents and patent applications listed on
      Appendix B-2, attached thereto and made a part thereof, are patent rights
      of TDCC that predate this MCA but which patent rights are necessary for
      TDCC to make, have made, use, sublicense, import, export, sell or have
      sold the Licensed Products; and (c) any divisions, continuations,
      continuations-in-part, reissues, reexaminations, extensions or other
      governmental actions which extend any of the subject matter of the patent
      applications or patents in (a) or (b) above, and any substitutions,
      confirmations, patents-of-addition, registrations or revalidations of any
      of the foregoing, in each case, which are Controlled by TDCC during the
                        ------------
      term of the Project Agreements and which are necessary for TDCC to make,
      have made, use, sublicense, import, export, sell or have sold the Licensed
      Products. All patents and patent applications subject to this definition
      are listed on Appendix B or will be included on Appendix B attached to
      each Project Agreement by the expiration of the research term of each
      Project Agreement.

1.33  "Term" means the duration of this MCA which is [***] from the Effective
       ----
      Date, unless extended by mutual written agreement.

1.34  "Territory" means the world.
       ---------

1.35  "Third Party" means any party who is not a Party, or an Affiliate.
       -----------

1.36  "Work Plans" mean the written research plans defining the activities to be
       ----------
      carried out under each Project Agreement, and the budget, for each project
      within the Project Field, as more specifically detailed in Appendix E
      attached thereto and made a part thereof, which may be modified from time
      to time by written amendment.

                              Article 2:  GRANTS

2.1  Exclusive Grants -
     -----------------
     2.1.1  The Parties agree to a [***] exclusive marketing relationship
            starting from the Effective Date for Licensed Enzymes and Licensed
            Products in the Territory for the Field and in accordance with the
            Purpose.

     2.1.2  The Licensed Enzyme and Licensed Product for a specific marketplace
            need of a Customer or Sublicensee shall be the subject of separate
            Project Agreements, that are attached hereto and made a part hereof,
            as described in Article 3. The Licensed Enzyme and Licensed Product
            under each Project Agreement is exclusive to TDCC and in accord with
            the terms of this MCA and the terms of each Project Agreement.

---------------------
* CONFIDENTIAL TREATMENT REQUESTED

                                       5
<PAGE>

2.2  Reservations -
     ------------
     2.2.1  [***] - To achieve the Purpose of this MCA, the Parties agree [***]:
            (a)  [***]
            (b)  [***]
            (c)  [***].

     2.2.2  Exercise of [***]- The Party presented with [***].
            ----------------------------------

     2.2.3  Interactions with Third Parties - Both Parties may individually or
            -------------------------------
            with a Third Party pursue any project opportunity outside the Field.
            These project opportunities shall not be subject to [***]. Within
            the Field, each Party may interact with any Third Party in accord
            with Sections 2.1 and 2.2.

2.3  Nonexclusive Grants - Unless a Project Agreement has been signed (with
     -------------------
     payment made or work begun, including Work Plans), either Party shall be
     free to develop and market its services in the Field to Customers and Third
     Parties during the term of this MCA. However, [***].

2.4  Roles and Responsibilities -
     --------------------------
     2.4.1  DIVERSA - DIVERSA shall be responsible for [***].
            -------

     2.4.2  TDCC - TDCC shall [***].
            ----

     2.4.3  Licensed Enzyme Manufacture - Where, prior to the signature date of
            ---------------------------
            a Project Agreement, DIVERSA has [***] then [***].

     2.4.4  When either Party interacts with a Third Party with respect to
            opportunities within the Field, that interacting Party shall use its
            commercially reasonable efforts to negotiate confidentiality terms
            that permit the other Party to be included in the discussions and/or
            to provide the Confidential Information of the other Party. The
            other Party shall be notified as promptly as possible of these
            discussions, including the identity of the Third Party, the specific
            Project Field, and the Confidential Information disclosed, in each
            case if such information is capable of being disclosed without
            breaching any confidentiality agreement. If samples of Licensed
            Enzymes are concerned then an MTA shall be required.

2.5  Litigation - Each Party shall be responsible for defending its own Patent
     ----------
     Rights.  Joint Patent Rights defense shall be discussed as to the
     respective interests involved.

2.6  Product Liability - The Customer or Sublicensee shall be responsible for
     -----------------
     all liability of the final drug product or its use of the Intermediate, API
     or Licensed Enzyme.

                        Article 3.  PROJECT AGREEMENTS

3.1  [***] Obligation for Project Agreements - Before any project by either
          ----------------------------------
     Party for the Purpose in the Field can be undertaken [***], the other Party
     must [***].  This [***] shall be in accordance with Section 2.2.  If that
     Party does desire to participate, then, a Project Agreement shall be
     negotiated, using each Party's good faith efforts.

------------------------
* CONFIDENTIAL TREATMENT REQUESTED

                                       6
<PAGE>

3.2  Terms Required for Each Project Agreement - Each Project Agreement,
     -----------------------------------------
     independently, shall contain its own budget (including FTEs funded [***]),
     Patent Rights appendices from each Party, Work Plans, terms regarding
     TDCC's diligence obligation to pursue commercialization, and reference to
     this MCA for terms to be maintained. Any royalties or other payments due
     shall be negotiated separately for each Project Agreement.

3.3  Improvements during a Project Agreement - Any Licensed Enzyme improvements
     ---------------------------------------
     made by DIVERSA in the Project Field for the Project Agreement during the
     term of either this MCA or the Project Agreement shall [***].

3.4  MCA Terms Carried to each Project Agreement - The Parties agree to be bound
     -------------------------------------------
     by and incorporate into each Project Agreement the terms of this MCA.

3.5  Exclusive Grant Provided Under Each Project Agreement - For each Project
     -----------------------------------------------------
     Agreement, the Licensed Product shall be granted exclusively to TDCC for
     the Project Field subject to the terms and conditions of the Project
     Agreement and this MCA. DIVERSA's Intellectual Property shall form a
     schedule(s) for this exclusive grant. Notwithstanding anything to the
     contrary contained herein, DIVERSA shall not be required to license, or
     hold harmless TDCC against infringements of, DIVERSA Intellectual Property
     that is not legally required for TDCC to carry out its roles and
     responsibilities hereunder (as set forth in Section 2.4.2) without
     infringing DIVERSA Intellectual Property (e.g., [***], TDCC will be
     required to negotiate with DIVERSA for an appropriate license or hold
     harmless as part of the applicable Project Agreement). Specific grants for
     each Project Agreement will be included in that document, which grants
     shall control over this MCA for that Project Field.

3.6  Term of Each Project Agreement - The term of each grant of the exclusive
     ------------------------------
     license to TDCC in accord with Section 3.5 for any Licensed Product shall
     be the last to expire of the Patent Rights, including any extensions,
     unless terminated earlier by TDCC or its Sublicensee.

3.7  Indemnity by DIVERSA - DIVERSA shall indemnify and hold TDCC, its agents,
     --------------------
     directors, officers, employees and Affiliates harmless from and against any
     and all liabilities, claims, demands, damages, costs, expenses or money
     judgments (including reasonable attorneys' fees and expenses) incurred by
     or rendered against any of them for personal injury, sickness, disease or
     death or property damage which directly arise out of:
     (a)  the intentional misconduct or negligence of DIVERSA; or
     (b)  the breach by DIVERSA of its representations, warranties or covenants
          contained in this MCA or any Project Agreement; or
     (c)  any activity carried out with Enzyme and Licensed Enzyme by DIVERSA
          other than through TDCC and its Affiliates under this MCA or Project
          Agreement; provided, however, that TDCC shall give DIVERSA notice in
          writing in accord with Article 17 as soon as practicable of any such
          claim or lawsuit and shall permit DIVERSA to undertake the defense
          thereof (including the right to settle the claim solely for monetary
          consideration) at DIVERSA's expense. However,
          (i)  TDCC will cooperate in such defense by providing access to
               witnesses and evidence available to it.  TDCC shall have the
               right to participate in any defense to the extent that in its
               judgment, TDCC may be prejudiced thereby; and
          (ii) in any claim or suit in which TDCC seeks indemnification by
               DIVERSA, TDCC shall not settle, offer to settle or admit
               liability or damages in any such claim or suit without the prior
               written consent of DIVERSA.

----------------------------
* CONFIDENTIAL TREATMENT REQUESTED

                                       7
<PAGE>

3.8  Indemnity by TDCC - TDCC shall defend, indemnify and hold DIVERSA and its
     -----------------
     Affiliates, and their respective agents, directors, officers, and employees
     harmless from and against any and all losses, liabilities, claims, demands,
     damages, costs, expenses or money judgments (including reasonable
     attorneys' fees and expenses) incurred by or rendered against any of them
     for personal injury, sickness, disease or death or property damage which
     arise out of
     (i)    the development, manufacturing, testing, handling, storage, use,
            promotion, sale or distribution of Licensed Products by TDCC or its
            Affiliates, except for those instances for which DIVERSA and not
            TDCC performs any of these functions; or
     (ii)   the breach by TDCC of any of its representations, warranties or
            covenants contained in this MCA or any Project Agreement; or
     (iii)  the intentional misconduct or gross negligence of TDCC;

          provided, however, that DIVERSA shall give TDCC notice in writing in
          accord with Article 17 as soon as practicable of any such claim or
          lawsuit and shall permit TDCC to undertake the defense thereof at
          TDCC's expense.  However,
          (i)   DIVERSA will cooperate in such defense by providing access to
                witnesses and evidence available to it. DIVERSA shall have the
                right to participate in any defense to the extent that in its
                judgment, DIVERSA may be prejudiced thereby; and
          (ii)  In any claim or suit in which DIVERSA seeks indemnification by
                TDCC, DIVERSA shall not settle, offer to settle or admit
                liability or damages in any such claim or suit without the prior
                written consent of TDCC.

3.9   [***] - The Parties agree [***].

3.10  Customer MTA - Any transfer of Confidential Information belonging to the
      ------------
      disclosing Party which the receiving Party desires to provide to a
      Customer must be done under an appropriate MTA of Appendix D. This
      requirement includes samples, know-how, Enzymes, and any other
      Confidential Information. A copy of the signed MTA must be supplied by the
      Party that is disclosing the Confidential Information to the Party that
      owns the Confidential Information.

                  Article 4.  ROYALTIES, REPORTS AND PAYMENTS


4.1  Annual Payment - TDCC shall pay DIVERSA an annual fee for the first year,
     --------------
     within thirty (30) days of the Signature Date, of [***] and as an annual
     fee thereafter by the anniversary of the Effective Date thereafter,
     beginning with 2001, of [***] per year for all exclusivity rights under
     Project Agreements to retain their exclusivity as well as for retaining the
     nonexclusive rights in the Field under this MCA. If TDCC terminates this
     MCA then each Project Agreement shall be maintained on its terms, but the
     rights to the Field are terminated.

4.2  FTE Payments - TDCC shall pay DIVERSA under each Project Agreement for the
     ------------
     FTE budget, quarterly in advance, and in the amounts as negotiated and set
     forth in the applicable Project Agreement. [***].

4.3  Milestone Payments - TDCC shall pay DIVERSA on the first occurrence for
     ------------------
     each Project Agreement of the following events:
     -----

------------------------
* CONFIDENTIAL TREATMENT REQUESTED

                                       8
<PAGE>

     (a)  [***]; or
                 --

     (b)  [***].

4.4  Earned Royalty - To be paid for each Project Agreement - TDCC shall pay
     --------------                  ----
     DIVERSA [***].

4.5  [***]

4.6  Enzyme Library Fee - TDCC shall have access to DIVERSA's enzyme
     ------------------
     subscription library for [***] per year for a [***] subscription. A
     separate agreement, having at least the standard conditions offered to all
     subscribers, shall be provided.

4.7  DIVERSA Payment to TDCC - DIVERSA shall pay TDCC for [***].
     -----------------------

4.8  Records -
     -------
     4.8.1  TDCC and DIVERSA shall keep accurate records of all operations
            affecting payments under this MCA, and shall permit the other
            Party's duly authorized agent, which is not unreasonably
            objectionable to the Party to inspect all such records during normal
            business hours throughout the term of this MCA and for [***] after
            termination.

     4.8.2  TDCC shall keep accurate records of all operations affecting
            payments under each Project Agreement, and shall permit DIVERSA's
            duly authorized agent, which is not unreasonably objectionable to
            TDCC, to inspect all such records during normal business hours
            throughout the term of each Project Agreement and for [***]
            thereafter.

4.9  Tax Issues - Any stamp duties or taxes due or paid on behalf of one Party
     ----------
     by the other Party shall be rectified at the end of each calendar year in
     the final accounting for that year. [***].

4.10  Payment Addresses - All payments due under Article 4 of this MCA or any
      -----------------
      Project Agreement shall be made by bank wire transfer in immediately
      available funds to:

      TDCC at:
           [***]

      All payment reports due under the MCA shall reference TDCC's agreement
      number [***], indicate the amount of payment with the date payment was
      made and an itemized listing and be sent to:

          The Dow Chemical Company
          Royalty Accounting
          2020 Dow Center
          Midland, MI 48674
          USA

     DIVERSA at:
       [***]

4.11  Late Payments - In the event that the due date of any payment subject to
      -------------
      this Article 4 (which shall only be deemed late if unpaid after forty-five
      days from its due date) is a Saturday, Sunday or holiday, such payment may
      be paid on the following business day.

-------------------------
* CONFIDENTIAL TREATMENT REQUESTED

                                       9
<PAGE>

     Any late payments shall bear interest to the extent permitted by applicable
     law at the prime rate (as reported by CitiBank, New York, NY or its
     successor), on the date such payment is due plus an additional [***],
     calculated on the number of days such payment is delinquent. The rights
     provided in this Section 4.9 shall in no way limit any other remedies
     available to the Parties hereunder. The defaulting Party may cure in accord
     with Section 9.3.

                          Article 5.  CONFIDENTIALITY

5.1  Effort - All Confidential Information shall not be disclosed by the
     ------
     recipient Party to any Third Party without the prior written approval of
     the disclosing Party.  Each Party shall use good faith efforts to retain in
     confidence and not disclose to any Third Party each other's Confidential
     Information disclosed pursuant to the terms of this MCA or under the terms
     of any Project Agreement.  Such "good faith efforts" shall mean the same
     degree of care, but no less than a reasonable degree of care, as the
     receiving Party uses to protect its own Confidential Information of a like
     nature.  All Confidential Information initially received in a non-written
     form shall be reduced to writing within thirty (30) days by the disclosing
     Party and such writing provided to the receiving Party.  The receiving
     Party shall not be obligated if such writing is not received timely.
     Exceptions to this Section 5.1 are stated in Sections 5.4 and 5.5.

5.2  CDA - The terms of the CDA shall remain in effect with regard to all
     ---
     activities between the Parties for the Field prior to the Effective Date.
     After the Effective Date the terms of this MCA shall control disclosure
     between the Parties for the Field.  Should any disclosure occur between the
     Parties that falls outside the Field, then only the CDA terms control.

5.3  Governmental Regulatory Submissions - If the MCA or any Project Agreement
     -----------------------------------
     must be provided to the public or a governmental agency, then redaction of
     as many terms as possible from this MCA and Project Agreements, with
     notification to the other Party, is required by the disclosing Party.

5.4  Exception for MCA Purpose - Notwithstanding the provisions of Section 5.1,
     -------------------------
     each Party may use Confidential Information of the other Party only to the
     extent required to accomplish the Purpose of this MCA. Because of the
     Purpose of this collaboration, the Parties agree that in order to
     sublicense or to sell Licensed Products in the Project Field, it may be
     necessary to disclose, under a confidentiality agreement (with terms at
     least as restrictive as those contained herein) and/or MTA, to a Third
     Party some Confidential Information of the Parties. However, before any
     such Confidential Information or MTA is signed or transferred with the non-
     disclosing Party's Confidential Information, the disclosing Party must
     determine whether the Third Party meets [***]. If it does, then no
     disclosure may be made of such Confidential Information without the non-
     disclosing Party's written consent. If no, then the confidentiality and MTA
     mentioned hereinabove must be used. The Party whose Confidential
     Information is being so disclosed shall be notified and the identity of the
     Third Party provided. Each Party hereby agrees to such disclosure to a
     Third Party for the Project Field for the Purpose of this collaboration to
     enable marking of the Licensed Products.

5.5  Exception for Legal Reasons - Notwithstanding the provisions of Section
     ---------------------------
     5.1, if the receiving Party becomes legally compelled to disclose any of
     the disclosing Party's Confidential Information, the receiving Party shall
     promptly advise the disclosing Party of such required disclosure in order
     that the disclosing Party may seek a protective order confidential
     treatment or such other remedy as the disclosing Party may consider

---------------------
* CONFIDENTIAL TREATMENT REQUESTED

                                       10
<PAGE>

     appropriate in the circumstances.  The receiving Party shall disclose only
     that portion of the Confidential Information that it is legally required to
     disclose. Such a disclosure shall not release the receiving Party with
     respect to the Confidential Information so disclosed except to the extent
     of permitting the required disclosure.

5.6  Disclosure to Affiliates, Contractors - Provided the information is not
     -------------------------------------
     disclosed to a Third Party who possesses [***] of the non-disclosing Party,
     TDCC or DIVERSA may disclose Confidential Information to their Affiliates,
     Sublicensees, consultants, contractors (parties under contract with TDCC
     for the custom manufacturing or shipping of Licensed Products or obtention
     of registration in the Territory), as may be necessary to exercise the
     rights granted hereunder and to register and prepare for commercialization
     of Licensed Products, and to commercialize Licensed Products under this
     MCA, under conditions of confidentiality at least as stringent as those set
     out in Article 5.

5.7  Survival of Confidentiality - Termination of this MCA for any reason shall
     ---------------------------
     not relieve the Parties of their obligations under Article 5.  The
     provisions of Article 5 shall survive termination of this MCA for [***].

                            Article 6.  PUBLICATION

6.1  Rights to Publish in Technical Journals or at Seminars - Each Party and its
     ------------------------------------------------------
     employees shall have the right to publish or present the results of
     Licensed Enzymes in the Fields under this MCA, provided such publication or
     presentation does not disclose Confidential Information of the other Party,
     and further provided that contributions by the other Party to such results
     are acknowledged.  If the publication is disclosing Enzymes, then the prior
     mutual consent of the Parties is required.  If consent is not given, no
     publication may occur.  All publication requests will be reviewed with
     consideration of the Purpose and the protection of Patent Rights.  The
     publishing/presenting Party will submit for review a copy of the proposed
     publication (including abstracts, or presentation to a journal, editor,
     meeting, seminar or other Third Party) resulting from discovery or use of
     the Licensed Enzymes under this MCA to the other Parties at least [***]
     prior to submission for publication, and if no response is received within
     [***] of the date submitted to the other Party, it may be conclusively
     presumed that the publication may proceed without delay.  Notwithstanding
     this paragraph, if a Sublicensee or Customer exists for a Project Agreement
     that would be affected by this publication, then that Sublicensee or
     Customer must also consent in writing to this publication.

6.2  Permitted Delay - If a Party determines that the proposed publication
     ---------------
     contains patentable subject matter which requires protection, that Party
     may require the delay of the publication for a period of time not to exceed
     [***] (or mutually agreed upon time) for the purpose of allowing the
     pursuit of such protection.  If the Sublicensee or Customer objects to the
     publication that impacts its Project Agreement or license, such publication
     shall not occur until such consent is given by that Customer or
     Sublicensee.

                   Article 7.  INTELLECTUAL PROPERTY RIGHTS

7.1  Inventorship - Inventorship on Patent Rights shall be determined using the
     ------------
     U.S. Patent laws (35 U.S.C et seq.) and regulations (37 C.F.R. et seq.) and
     U.S. Federal Court decisions. Because inventorship is a difficult area of
     the law, the Parties agree to use their good faith efforts to resolve any
     disputes. Should that effort fail, then a mutually agreed upon outside
     patent counsel shall make the determination of inventorship and the

-----------------------
* CONFIDENTIAL TREATMENT REQUESTED

                                       11
<PAGE>

     Parties shall share equally the costs of that counsel. If Joint Patent
     Rights occur each claim shall have its inventorship determined using this
     same procedure.

7.2  Ownership and Right to Use -
     --------------------------
     7.2.1  The first determining factor for ownership of any Patent Rights
            shall be which Party is the assignee of the patent or patent
            application. For Joint Patent Rights, and contrary to U.S. Patent
            laws and court decisions and any laws of other countries, the
            assignee of each claim shall determine ownership of that claim and
            shall be the determining factor for the right of each Party to
            practice each claim.

     7.2.2  Each Party shall have a freedom from suit under its Patent Rights
            granted by the other Party to perform its obligations for each
            Project Agreement under its Work Plans. No Party may use the
            Intellectual Property Rights of the other Party for any purpose
            other than to perform its obligations under the Work Plans. All
            rights to use the other Party's Patent Rights or Know-How cease when
            that particular Project Agreement terminates or is completed.

     7.2.3  Notwithstanding the termination or completion of the Project
            Agreement, if there is a Licensed Product resulting from a Project
            Agreement and such Licensed Product is desired by a Customer or
            Sublicensee in the Project Field, then to meet the Purpose those
            Patent Rights for the Licensed Product may be granted by agreement
            (including by label license) to that Customer or licensed to that
            Sublicensee and shall not terminate until the respective agreement
            or license is terminated or expires or the Patent Rights expire.

     7.2.4  To permit the Purpose of the Parties for Licensed Products with
            Sublicensees and Customers, the right to practice various claims and
            Patent Rights (including required DIVERSA Know-How) shall be
            accomplished by a license to TDCC as stated in the attached [***].
            This Chart shall only serve to clarify [***]. All Patent Rights to
            each indicated license shall be granted for each Project Agreement
            by its own attached Patent Rights schedule and all payments for the
            license shall be as stated in Article 4, unless modified in the
            respective Project Agreement. Each license shall be limited to the
            specific Licensed Product for the Project Field.

7.3  Prosecution -
     -----------
     7.3.1  DIVERSA to Maintain DIVERSA Patent Rights - DIVERSA shall have the
            -----------------------------------------
            obligation and be responsible, at its own cost and expense, for
            prosecuting the patent applications in DIVERSA Patent Rights and for
            maintaining, and where possible extending, those DIVERSA Patent
            Rights for the term of each Project Agreement to which those rights
            pertain.

     7.3.2  TDCC to Maintain TDCC Patent Rights - TDCC shall have the obligation
            -----------------------------------
            and be responsible, at its own cost and expense, for prosecuting the
            patent applications in TDCC Patent Rights and for maintaining, and
            where possible extending, those TDCC Patent Rights for the term of
            each Project Agreement to which those rights pertain.

     7.3.3  Maintaining Joint Patent Rights - The Parties shall mutually try to
            -------------------------------
            agree which Party shall maintain any Joint Patent Rights. One Party
            shall have the obligation and be responsible, at its own cost and
            expense, for prosecuting the patent applications in Joint Patent
            Rights, while consulting with the other Party with respect to its
            claims, and for maintaining, and where possible extending, those

--------------------
* CONFIDENTIAL TREATMENT REQUESTED

                                       12
<PAGE>

            Joint Patent Rights for the term of each Project Agreement to which
            those rights pertain. If the Parties cannot agree which of them
            should maintain any particular Joint Patent Right, then they shall
            agree on an acceptable outside counsel and each pay one-half of
            those costs.

     7.3.4  Notice of Patent Lapse of Patent Rights - DIVERSA shall promptly
            ----------------------------------------
            advise TDCC of the grant, lapse, nullification, revocation,
            surrender, or invalidation of any of DIVERSA Patent Rights and Joint
            Patent Rights, at least in advance of any abandonment to enable TDCC
            to assume that prosecution, at TDCC's expense, should TDCC not agree
            to such abandonment.

7.4  Validity, Non-Infringement - DIVERSA does not warrant that the manufacture,
     --------------------------
     use and sale of Licensed Enzymes do not fall within the scope of Third
     Party patents or the intellectual property rights of a Third Party.
     However, [***].

7.5  Disclaimer of Warranties as to Patent Rights - Other than as stated in
     --------------------------------------------
     Section 7.3, DIVERSA makes no representation that the inventions covered in
     any DIVERSA Patent Rights are patentable or that the DIVERSA Patent Rights
     are or will be valid or enforceable, nor does DIVERSA warrant or represent
     that the exercise of the rights licensed hereunder is free of infringement
     of patent rights of Third Parties.

7.6  Hold Harmless - DIVERSA agrees to hold TDCC harmless for patent
     -------------
     infringement under any DIVERSA patents or patents licensed to TDCC which
     may be otherwise infringed by TDCC's performance under this MCA or any
     Project Agreement so long as this MCA or the relevant Project Agreement is
     in effect and is not terminated.

7.7  Cooperation - DIVERSA and TDCC shall use good faith efforts to cooperate
     -----------
     with respect to any issues that concern Patent Rights and the development
     of the Licensed Products under this MCA or Project Agreement. [***].

7.7  Third Party Infringement Claims -
     -------------------------------
     7.7.1  Notice of Claim - In the event that TDCC receives a written notice
            ---------------
            of an allegation of possible patent infringement from a Third Party
            or determines that there is such possible infringement based on the
            use of an Enzyme or Licensed Enzyme, TDCC shall notify DIVERSA in
            writing and [***].

     7.7.2  Defense of Third Party Patent Claims - If a claim is brought by a
            ------------------------------------
            Third Party that the manufacture, use or the sale of a Licensed
            Enzyme or its use in Licensed Products in the Territory (regardless
            of use) infringes a patent of such Third Party, TDCC will give
            prompt written notice to DIVERSA of such claim if it concerns
            DIVERSA Patent Rights. The Parties shall confer in accord with
            Section 7.7.3.

     7.7.3  Mutual Decisions - From the Effective Date and using their good
            ----------------
            faith efforts, DIVERSA and TDCC shall discuss any claim or suit
            brought by a Third Party for patent infringement and mutually
            evaluate whether that Third Party's patent is infringed by the
            manufacture, use or sale of any Licensed Enzyme covered in DIVERSA
            Patent Rights by TDCC or its Affiliates or Sublicensees in the
            Territory. Specifically, DIVERSA and TDCC shall mutually try to
            agree on:
            (a)  the strategy for such suit or claim, e.g. whether to negotiate
                 a settlement, sue or withdraw selling the Licensed Enzyme or
                 Licensed Product from the country in the Territory in which
                 infringement is claimed;

--------------------
* CONFIDENTIAL TREATMENT REQUESTED

                                       13
<PAGE>

            (b)  the basis to be determined for sharing the costs of litigation,
                 damages awarded, and royalty to be paid to the Third Party ;

            (c)  which Party should conduct the defense or if both DIVERSA and
                 TDCC should jointly defend; and the consequences of such
                 decisions.

     7.7.4  Third Party [***] - TDCC shall use its good faith efforts to [***].
            ------------
            As of the Effective Date for the present Project Agreements for use
            of Licensed Enzyme designation for Licensed Products, [***].


7.8  Patent Enforcement & Litigation -
     -------------------------------
     7.8.1  Enforcement -
            -----------

          7.8.1.1  If either Party learns of any infringement of DIVERSA Patent
                   Rights by a Third Party, it shall promptly notify the other
                   Party.

          7.8.1.2  If the possible infringement concerns a Licensed Enzyme that
                   is competing with TDCC, then DIVERSA shall [***]. DIVERSA
                   will bear the costs and shall be entitled to any recovery
                   obtained from such litigation, settlement or compromise
                   thereof. If DIVERSA elects not to take action for such
                   infringement, then TDCC may do so at TDCC's expense and shall
                   [***].

     7.8.2  Settlement - Any settlement of an infringement suit, whether brought
            ----------
            by TDCC or by DIVERSA, shall be subject to the consent of both
            Parties, which consent shall not be unreasonably withheld.  [***].

     7.8.3  Cooperation - Each Party shall cooperate with the other Party to the
            -----------
            extent reasonably requested in any legal action:

            (a)  related to this MCA or any Project Agreement brought by a Third
                 Party against one Party; or

            (b)  related to this MCA or any Project Agreement brought by a Third
                 Party against both Parties; or

            (c)  taken against a Third Party by either Party regarding DIVERSA
                 Patent Rights in the Field in the Territory, and each Party
                 shall have the right to participate in any defense, compromise
                 or settlement to the extent that, in its judgment, it may be
                 prejudiced thereby.

7.9  Marking -
     -------
     7.9.1  TDCC agrees to mark, where required by law or desired for notice,
            all Licensed Enzymes or Licensed Products sold by it to a Third
            Party under this MCA, including under any sold that result under
            Project Agreements, with the word "Patent" or "Patents" and the
            number or numbers of the Licensed Patents applicable thereto.

     7.9.2  TDCC agrees (a) to mark any Intermediate or API, that [***] and (b)
            to respond to any request for disclosure under 35 U.S.C.
            (S)287(b)(4)(B) by notifying DIVERSA of the request for disclosure,
            if the Licensed Process Patent is owned by DIVERSA.

-------------------------
* CONFIDENTIAL TREATMENT REQUESTED

                                       14
<PAGE>

     7.9.3  This marking requirement may be modified in sublicense agreements,
            provided that other adequate notice for damages is provided and any
            legal requirements are met.

7.10  Misuse - TDCC shall use its reasonable best efforts to avoid any patent
      ------
      misuse,[***].

7.11  Multipatent Issues - The Parties agree that identical Patent Rights,
      ------------------
      DIVERSA Patent Rights, TDCC Patent Rights, Joint Patent Rights or a
      combination of such Patent Rights may be required for each Project
      Agreement and that each Project Agreement may differ in the Patent Rights
      required as each project will vary within the Field for the Purpose.

                          Article 8.  OPTION TO [***]

8.1  [***].

8.2  [***].

8.3  [***].

                      Article 9.  TERM AND DISENGAGEMENT

9.1  Term -
     ----
     9.1.1  This MCA shall be effective for [***] from the Effective Date,
            unless otherwise terminated earlier under Section 9.2. The Parties
            may by mutual written consent extend this term.

     9.1.2  The term of this MCA is independent of the Project Agreements. Thus
            each Project Agreement may continue for the term of its respective
            Intellectual Property even if this MCA is terminated earlier.

9.2  Termination -
     -----------
     9.2.1  By a Party - Either Party may terminate this MCA on [***] written
            ----------
            notice, in accordance with Article 17, to the other Party.

     9.2.2  By DIVERSA - If TDCC fails to pay any payments when due under
            ----------
            Article 4 (after notice of default and opportunity to cure), then
            DIVERSA may terminate this MCA in accord with Section 9.3.

     9.2.3  By TDCC - If DIVERSA fails to pay any payments when due under
            --------
            Section 4.7 (after notice of default and opportunity to cure), then
            TDCC may terminate this MCA in accord with Section 9.3.

     9.2.4  Change of Control - TDCC shall have the right to immediately
            -----------------
            terminate this MCA and any or all Project Agreements upon a Change
            of Control of DIVERSA.

     9.2.5  Effect of Termination - Project Agreements that have been signed and
            ----------------------
            funded at the time of termination of this MCA shall continue
            according to their terms and be exclusive grants for their Licensed
            Products or described Project Field.

     9.2.6  Project Agreement - Either Party shall have the right to immediately
            ------------------
            terminate each Project Agreement separately, in accordance with
            Article 17, if (a) a milestone defined in the Project Agreement is
            not achieved, or (b) the Customer

----------------------
* CONFIDENTIAL TREATMENT REQUESTED

                                       15
<PAGE>

          for the Project Agreement terminates the program, or (c) the
          Sublicensee terminates its license.

9.3  Material Breach.
     ---------------

     In the event that either Party commits a material breach of any obligations
     under this MCA and such Party fails to (a) remedy that breach within [***]
     after receiving written notice thereof from the non-breaching Party, (b) to
     commence dispute resolution under Article 12 within [***] after receiving
     written notice thereof from the non-breaching Party, then the non-breaching
     Party shall begin dispute resolution under Article 12.  Material Breach
     includes failure to make any payments when due under this CA or any Project
     Agreement.  Nevertheless, failure to pay under one Project Agreement or
     this MCA is not a breach of any other Project Agreement.

9.4  Effect of Termination; Accrued Obligations.
     ------------------------------------------

     Termination of this MCA or each Project Agreement for any reason shall not
     release any 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 any rights and remedies it may have hereunder or at law
     or in equity which accrued or are based upon any event occurring prior to
     such termination.  All Confidential Information of the other Party shall be
     returned immediately at termination.

9.5  Surviving Provisions.
     --------------------

     On termination of this MCA: the obligations of confidentiality set forth in
     Sections 5.1 and 5.2 shall survive for the time stated therein; export
     control compliance set forth in Section 11.13 shall survive; the
     indemnification obligations set forth in Article 11 and Third Party
     infringement claims set forth in Section 7.7 shall survive as to all claims
     or actions arising from events which occurred before termination.  Article
     12 shall survive termination of this MCA so long as any disputes arising
     prior to such termination exist.  Section 7.1 of this MCA shall survive the
     expiration or termination of this MCA for any reason.

              Article 10.  PRODUCT LIABILITY AND INDEMNIFICATION

10.1  Indemnification Under the MCA -
      ------------------------------

     Neither Party shall indemnify the other Party nor its Affiliates, or
     respective officers, directors, employees and agents and its respective
     successors, heirs and assigns ("Indemnitees"), except for its respective
     gross negligence, for any actions or product liability concerning any
     Licensed Product.  This paragraph does not limit either Party's other
     remedies available to it under the law with respect to Licensed Products.
     TDCC shall provide for product liability indemnification for Licensed
     Products from all its Sublicensees.

10.2  Procedure.
      ---------
     10.2.1  A Party that intends to claim indemnification under this Article 10
             (the "Indemnitee") shall promptly notify the other Party (the
             "Indemnitor") in writing of any loss, claim, damage, liability or
             action in respect of which the Indemnitee or any of its Affiliates
             or their directors, officers, employees, agents, consultants or
             counsel intend to claim such indemnification, and the Indemnitor
             shall have the

----------------------
* CONFIDENTIAL TREATMENT REQUESTED

                                       16
<PAGE>

             right to participate in, and, to the extent the Indemnitor so
             desires, to assume the defense thereof with counsel of its own
             choice.

     10.2.2  The indemnity agreement in this Article 10 shall not apply to
             amounts paid in settlement of any loss, claim, damage, liability or
             action if such settlement is made without the consent of the
             Indemnitor, which consent shall not be withheld unreasonably.  The
             failure to deliver written notice to the Indemnitor within a
             reasonable time after the commencement of any such action, if
             prejudicial to its ability to defend such action, shall relieve
             such Indemnitor of any liability to the Indemnitee under this
             Article 10.

     10.2.3  At the Indemnitor's request, the Indemnitee under this Article 10,
             and its employees and agents, shall cooperate fully with the
             Indemnitor and its legal representatives in the investigation and
             defense of any action, claim or liability covered by this
             indemnification and provide full information with respect thereto.

                 Article 11.  EXPORT AND COMPLIANCE WITH LAWS

11.1  The Export Administration Regulations of the United States Department of
      Commerce (EAR) prohibit, except under an individual validated license, the
      exportation from the United States of technical data relating to certain
      commodities (listed in the Export Administration Regulations), unless TDCC
      or its Sublicensee has received certain written assurances from the
      foreign importer.  TDCC hereby agrees to comply with the EAR and shall
      provide that any Sublicensee shall also promise to comply.

11.2  If DIVERSA exports technical data, Enzymes or Licensed Enzymes it hereby
      agrees to comply with the EAR.

11.3  TDCC agrees to obtain, or shall have its Sublicensee obtain, all necessary
      clearances from any government in the Territory for export or re-export
      with respect to Licensed Products.

11.4  This MCA, including all Project Agreements, shall be subject to all the
      United States government, State and local laws and regulations now or
      hereafter applicable to the subject matter of this MCA. Both Parties agree
      to comply with all of these applicable laws.

                        Article 12.  DISPUTE RESOLUTION

12.1  Choice of Law - This MCA and all Project Agreements shall be governed by
      -------------
      the laws of the State of Delaware, excepting its conflict of laws
      principles, in all respects of validity, construction and performance,
      except that all questions concerning the construction, validity, coverage
      or infringement of DIVERSA Patent Rights or Joint Patent Rights shall be
      decided in accordance with the patent law of the country where the patent
      was granted.

12.2  Disputes - Both Parties shall make good faith efforts to resolve any
      --------
      questions concerning construction and performance under this MCA and all
      Project Agreements, excluding DIVERSA Patent Rights and antitrust issues
      (which are settled by court proceeding in the concerned country), by:

     12.2.1  Notice, contact and negotiation, all proceedings and documents in
             English, between the Parties listed under Article 17.1 within one
             hundred twenty (120)

                                       17
<PAGE>

             days from the date of the notice by negotiation either by telephone
             or by meeting in Denver, CO; and

     12.2.2  If unsuccessful under Article 12.2.1, then senior executive
             management with settlement authority and counsel of TDCC and
             DIVERSA shall meet at a mutually agreeable neutral location within
             sixty (60) days from a date of notice that Article 12.2.1 failed to
             resolve the issues. Counsel shall present the legal and factual
             arguments to such executives in English, with supporting evidence
             if necessary, and resolution by these executives is expected within
             ten (10) business days therefrom , which may be reduced to writing
             in English as an amendment to this MCA; and

     12.2.3  If such executives have not met or resolved the issues under
             Article 12.2.2, then within seventy five (75) days from the date of
             the notice under Article 12.2.1, the Parties shall submit the
             issues to mediation in Chicago, IL, in English, in accordance with
             the Rules of the American Arbitration Association ("AAA"), which
             may be modified by the Parties, and judgment shall be binding. The
             Parties agree that the following procedures shall be adhered to
             even though they may, in part, not be in full conformance with said
             Rules:

             (a) Three Mediators shall be selected from a list of at least 20
                 arbitrators selected by the AAA composed of counsel with
                 chemistry, molecular biology, chiral chemistry or
                 pharmaceutical expertise who are practicing or retired partners
                 in law firms or in-house corporate counsel not affiliated with
                 the Parties with at least 15 years of experience in law and
                 knowledge of the pertinent laws of any country relevant to the
                 dispute. If the dispute issue is relevant for a commercial
                 expert to advise the Mediators, one expert selected by the
                 mediators may be used. The mediation proceedings and reports
                 shall be in English. The time from the beginning of submission
                 for mediation and conclusion of any oral or written proceedings
                 shall not exceed six (6) months; and

            (b)  Limited discovery to only that which each Party has a
                 substantial, demonstrable need, and shall be conducted in the
                 most expeditious and cost-effective manner. The Mediators shall
                 resolve any issues with regard to the discovery. Decision by
                 the Mediators shall be given in writing within thirty (30) days
                 from the end of oral proceedings; and

            (c)  The decision by the Mediators is binding, but should either
                 Party then need to have a Court of competent jurisdiction for
                 the Parties enforce the decision, either Party may introduce
                 into court the decision reached by Mediation with its
                 supporting evidence.

                  Article 13.  REPRESENTATIONS AND WARRANTIES

13.1  Organization - Each Party states that it is a corporation duly organized,
      ------------
      validly existing and is in good standing under the laws of the
      jurisdiction of its incorporation or organization, is qualified to do
      business and in good standing as a foreign corporation in each
      jurisdiction in which the performance of its obligations hereunder
      requires such qualification and has all requisite power and authority,
      corporate or otherwise, to conduct its business as now being conducted, to
      own, lease and operate its properties and to execute, deliver and perform
      this MCA and all Project Agreements.

13.2  Authorization - The execution, delivery and performance by it of this MCA
      -------------
      and all Project Agreements have been duly authorized by all necessary
      corporate action and

                                       18
<PAGE>

      do not and will not: (a) require any consent or approval of its
      stockholders or (b) violate any provision of any law, rule, regulation,
      order, writ, judgment, injunction, decree, determination or award
      presently in effect having applicability to it or any provision of its
      charter documents.

13.3  Binding Agreement - This MCA is a legal, valid and binding obligation of
      -----------------
      it, enforceable against it in accordance with its terms and conditions.
      Each Project Agreement shall also be a legal, valid and binding obligation
      of it, enforceable against it in accordance with its respective terms and
      conditions.

13.4  Warranty Disclaimer - EXCEPT AS OTHERWISE EXPRESSLY PROVIDED IN THIS MCA,
      -------------------
      NEITHER Party MAKES ANY REPRESENTATION OR WARRANTY OF ANY KIND, EXPRESS OR
      IMPLIED, WITH RESPECT TO ANY Confidential Information, DIVERSA Patent
      Rights, Know-How, Licensed Enzymes, Licensed Products, Intermediates, APIs
      OR OTHER TECHNOLOGY, GOODS, SERVICES, RIGHTS OR OTHER SUBJECT MATTER OF
      THIS MCA AND HEREBY DISCLAIMS ANY WARRANTY OF MERCHANTABILITY, FITNESS FOR
      A PARTICULAR PURPOSE, NON-INFRINGEMENT, OR VALIDITY OF TECHNOLOGY OR
      PATENT CLAIMS, ISSUED OR PENDING, WITH RESPECT TO ANY AND ALL OF THE
      FOREGOING.

13.5  Limited Liability - EXCEPT AS EXPRESSLY PROVIDED HEREIN, NEITHER DIVERSA
      -----------------
      NOR TDCC WILL BE LIABLE TO THE OTHER Party WITH RESPECT TO ANY SUBJECT
      MATTER OF THIS MCA UNDER ANY CONTRACT, NEGLIGENCE, STRICT LIABILITY OR
      OTHER LEGAL OR EQUITABLE THEORY FOR (a) ANY SPECIAL, INDIRECT, INCIDENTAL,
      CONSEQUENTIAL OR PUNITIVE DAMAGES OR LOST PROFITS OR (b) COST OF
      PROCUREMENT OF SUBSTITUTE GOODS, TECHNOLOGY OR SERVICES.

                            Article 14.  BANKRUPTCY

14.1  DIVERSA Bankruptcy - If DIVERSA files for protection under bankruptcy
      ------------------
      laws, makes an assignment for the benefit of creditors, appoints or
      suffers appointment of a receiver or trustee over its property, files a
      voluntary petition under any bankruptcy or insolvency act or has any such
      petition filed against it which is not discharged within sixty (60) days
      of the filing thereof, then the rights and licenses granted under or
      pursuant to this MCA shall be deemed to be, for purposes of Section 365(n)
      of the US Bankruptcy Code (11 U.S.C.), licenses or rights to "intellectual
      property" as defined under Section 101(52) of the US Bankruptcy Code.
      DIVERSA agrees that TDCC, as a licensee of such rights under this MCA,
      shall retain and may fully exercise all of its rights and elections under
      the US Bankruptcy Code, subject to performance by the licensee of its
      preexisting obligations under this MCA.

14.2  TDCC Bankruptcy - If TDCC files for protection under bankruptcy laws,
      ---------------
      makes an assignment for the benefit of creditors, appoints or suffers
      appointment of a receiver or trustee over its property, files a voluntary
      petition under any bankruptcy or insolvency act or has any such petition
      filed against it which is not discharged within sixty (60) days of the
      filing thereof, then the rights and licenses granted under or pursuant to
      this MCA shall be deemed to be, for purposes of Section 365(c) and (e)(2)
      of the US Bankruptcy Code (11 U.S.C.), licenses or rights to "intellectual
      property" as defined under Section 101(52) of the US Bankruptcy Code. TDCC
      agrees that DIVERSA, as a licensor of such rights under this MCA, shall
      retain and may fully exercise all of its rights and elections under the US
      Bankruptcy Code, including it right to immediately terminate this MCA.
      Notwithstanding the provisions of this Section 14.2, such right of
      termination shall not

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<PAGE>

      extend to any TDCC Sublicensees providing that those Sublicensees are
      performing in accord with their obligations under this MCA and Sublicensee
      agreement.

                          Article 15.  FORCE MAJEURE

15.1  Neither Party shall be liable to the other Party for failure of or delay
      in performing obligations set forth in this MCA, and neither Party shall
      be deemed in breach of its obligations, if such failure or delay is due to
      natural disasters or any other cause beyond the reasonable control of a
      Party, and notice of such prevention of prevention of performance is
      promptly provided by the non-performing Party in accordance with Section
      17.1. Such excuse shall be continued so long as the condition constituting
      force majeure continues and the non-performing Party takes reasonable
      efforts to remove the condition.

15.2  In event of such force majeure, the Party affected thereby shall use
      reasonable efforts to cure or overcome the same and resume performance of
      its obligations hereunder.

                    Article 16.  ASSIGNMENT AND SUCCESSORS

16.1  The Parties agree this MCA imposes personal obligations on both Parties.
      Neither Party shall assign any rights under this MCA not specifically
      transferable by its terms without the prior written consent of the other
      Party, except that each Party may, without such consent, assign this MCA
      and the rights, obligations and interests of such Party, in whole or in
      part, including one or more of the Project Agreements, to any of its
      Affiliates so long as such Affiliate can perform that Party's obligations.

16.2  If any Change of Control of a Party occurs and an assignment to such
      purchaser or other transferee of all or substantially al of its assets in
      the line of business to which this MCA or any one of the Project
      Agreements pertains, or to any successor corporation resulting from any
      merger or consolidation of such Party with or into another entity, then
      the other Party may immediately terminate this MCA or any of the Project
      Agreements. In the event of any merger or consolidation by a Party into
      another entity, such Party shall promptly notify the other Party in
      writing of such merger or consolidation ad the obligations under this MCA
      shall be maintained and performed by the successor entity unless modified
      in accordance with Section 18.6 or terminated in accordance with Article
      9.

                              Article 17.  NOTICE

17.1  For the purpose of all written communications and notices between the
      Parties under this MCA, any notice shall be shall be sent by overnight
      courier, registered mail, or facsimile to each Party as follows:

                                       20
<PAGE>

     If to DOW:
          The Dow Chemical Company
          [***]

          Attention: [***]


          Telephone:  [***]
          Facsimile:  [***]

        with a copy to:
          The Dow Chemical Company
          [***]
          Attention:  [***]

          Telephone:
          Facsimile:

     To DIVERSA:
          Diversa Corporation
          10665 Sorrento Valley Road
          San Diego, CA 92121

          Attention:  Patrick McCroskey, PhD
                   Sr. Director, Business Development
          Telephone:  858-623-5179
          Facsimile:  858-626-3779

       with a copy to:
          Diversa Corporation
          10665 Sorrento Valley Road
          San Diego, CA 92121

          Attention:  Carolyn Erickson
                   Vice President, Intellectual Property
          Telephone:  858-623-5104
          Facsimile:  858-453-9133

17.2  Either Party may amend its persons to receive notice or supply any other
      address for service by notifying the other Party in writing.

                     Article 18.  MISCELLANEOUS PROVISIONS

18.1  Headings - Headings in this MCA are included herein for ease of reference
      --------
      and shall not affect the meaning of the provisions of this MCA, nor shall
      they have any other legal effect.

18.2  Interpretation - The Parties acknowledge and agree that: (a) each Party
      --------------
      and its counsel reviewed and negotiated the terms and provisions of this
      MCA and have contributed to its revision; (b) the rule of construction to
      the effect that any ambiguities are resolved against the drafting Party
      shall not be employed in the interpretation of this MCA; and (c) the terms
      and provisions of this MCA shall be construed fairly as to all Parties
      hereto and not

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                                       21
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      in favor of or against any Party, regardless of which Party
      was generally responsible for the preparation of this MCA.

18.3  Integration, Preclusion Of Prior Understandings - This MCA and its
      -----------------------------------------------
      attachments, including all Project Agreements, represents the entire
      understanding between the Parties with respect to the Field, and
      supersedes all other agreements, express or implied, between the Parties.

18.4  Applicable Law - This MCA shall be construed in accordance with the laws
      --------------
      of the United States if a federal issue, or the laws of the State of
      Delaware if a state issue, as interpreted by the courts in the State of
      Delaware, without regard to choice of law provisions of such laws.

18.5  Severability -
      ------------
     18.5.1  The Parties agree that if any part, term, or provision of this MCA
             shall be found illegal or in conflict with or unenforceable under
             any valid controlling body of law, the validity of the remaining
             provisions shall not be affected thereby.

     18.5.2  In the event the legality of any provision of this MCA is brought
             into question because of a decision by a court of competent
             jurisdiction of any country in which this MCA applies, TDCC, by
             written notice to DIVERSA in accordance with Article 17, may revise
             the provision in question or may delete it entirely so as to comply
             with the decision of said court.

18.6  Alteration - A provision of this MCA may be altered only by a writing
      ----------
      signed by both Parties, except as provided in Section 12.5. A provision of
      this MCA may be altered for a specific Project Agreement by the terms of
      that Project Agreement.

18.7  Waiver, Cumulative Remedies - The waiver by either Party of any term or
      ---------------------------
      condition of this MCA in any one instance shall not be deemed construed to
      be a waiver of such term or condition for any similar instance in the
      future or of any subsequent breach hereof.  Such waiver may be effected
      only by a written document signed by the waiving Party.  All rights,
      remedies, undertakings, obligations and agreements contained in this MCA
      shall be cumulative and none of them shall be a limitation of any other
      remedy, right, undertaking, obligation or agreement of either Party.

18.8  Registration And Recordation -
      -----------------------------
      18.8.1  Each Party agrees to execute such additional papers or documents
              in customary legal form and to make such governmental filings or
              applications as may be necessary or desirable to effect the
              Purpose of this MCA and carry out its provisions. Examples of such
              documents are material transfer agreements and confidentiality
              agreements with a Third Party.

     18.8.2  If the terms of this MCA are such as to require or make it
             appropriate that this MCA or any part of it, or any Project
             Agreement hereto, be registered with or reported to a national or
             supranational agency of any area in which TDCC or its Sublicensee
             will do business under this MCA, TDCC or its Sublicensee shall
             undertake such registration or report at its expense. Prompt notice
             and appropriate verification of the act of registration or report
             of any agency ruling resulting from it will be supplied by TDCC to
             DIVERSA.

18.9  Publicity -
      ---------
      18.9.1  Neither Party shall make the financial terms of this MCA public,
              except as required by law or by mutual consent. Either Party may
              make such disclosure of the existence of this MCA to its
              attorneys, advisors, investors, prospective investors, lenders and
              other financing sources, under circumstances that

                                       22
<PAGE>

              reasonably ensure confidentiality. In the event that a filing of a
              copy of this MCA with the US Securities and Exchange Commission is
              required, then DIVERSA and TDCC shall seek confidential treatment
              of information considered confidential by either Party and shall
              redact the financial and as much other information a possible.

      18.9.2  Any press release or publicity of this MCA shall be reviewed and
              approved by both Parties prior to any release. It is expected that
              a Q&A outline for use in responding to inquires about this MCA
              shall be prepared and used by both Parties. Thereafter both
              Parties may disclose the information contained in such press
              release and Q&A outline without the need for further approval. In
              no event shall the financial terms of this MCA be publicly
              disclosed, except as noted in Sections 12.8.2 and 12.9.1.

18.10  No Agency or Partnership - Nothing contained in this MCA shall give
       ------------------------
       either Party the right to bind the other Party, or be deemed to
       constitute either Party as an agent for the other Party or as a partner
       with the other Party or any Third Party. Nevertheless both Parties may
       represent to a Third Party that they are collaborating together for the
       Field without any agency or partnership implied.


IN WITNESS WHEREOF, each of the Parties hereto has caused this MCA to be
executed in duplicate originals by its duly authorized officers or
representatives on the dates set forth below.  This MCA may be signed in
separate counterparts by facsimile with original signatures bearing the same
date as the facsimile provided promptly thereafter.  The Parties expect that
this MCA will depend upon execution of at least one Project Agreement having the
same Effective Date as this MCA and other Project Agreements thereafter.  This
MCA shall be void ab initio if not signed by both Parties within [***].


Diversa Corporation                         The Dow Chemical Company


/s/ Jay M. Short                            [***]
_____________________________               ____________________________________
Jay M. Short, PhD                           [***]
Chief Executive Officer


Date: _______________________               Date: ______________________________

  .  [***]



                                       23
                                      [***]
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* CONFIDENTIAL TREATMENT REQUESTED

Source: OneCLE Business Contracts.