MASTER LOAN AND SECURITY AGREEMENT

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Exhibit 10.31

MASTER LOAN AND SECURITY AGREEMENT

NO. 2081008 DATED: AUGUST 28, 2002

LENDER: BORROWER:

OXFORD FINANCE CORPORATION STRUCTURAL GENOMIX, INC.

A Maryland corporation a Delaware corporation

Address: Address:

133 NORTH FAIRFAX STREET 10505 ROSELLE STREET

ALEXANDRIA, VIRGINIA 22314 SAN DIEGO, CA 92121

Borrower hereby agrees with Lender that, whenever Borrower shall be at any

time or times directly or contingently indebted, liable or obligated to Lender

in any manner whatsoever, Lender shall have the following rights:

1. DEFINITIONS. To the extent not otherwise specifically defined in this

Agreement, unless the context otherwise requires, all other terms contained in

this Agreement shall have the meanings assigned or referred to them in the UCC.

The following terms shall have the following meanings:

"Acceptance Date" with respect to each item of Equipment shall have the

meaning assigned to such term in Section 3 of this Agreement.

"Affiliate" shall mean, with respect to any person, firm or entity, any

other person, firm or entity controlling, controlled by, or under common control

with such person, firm or entity; for the purposes hereof "control" shall mean

the possession, directly or indirectly, of the power to direct or cause the

direction of the management and policies of any such person, firm or entity,

whether through the legal or beneficial ownership of voting securities, by

contract or otherwise.

"Agreement" shall mean this Master Loan and Security Agreement, as amended

or modified from time to time.

"Attorneys' Fees and Expenses" shall mean all reasonable attorneys' fees

and legal costs and expenses (including, without limitation, those fees, costs

and expenses incurred in connection with bankruptcy proceedings, including

Relief from Stay Motions, Cash Collateral Motions and disputes concerning any

proposed disclosure statement and/or bankruptcy plan).

"Collateral" shall mean all Equipment or other tangible or intangible

property ancillary to the Equipment and acquired in the same transaction as the

Equipment and all products, proceeds, rents and profits therefrom or thereof

including proceeds in the form of goods, accounts, chattel paper, documents,

instruments and insurance proceeds.

"Default" shall have the meaning ascribed to such term in Section 7 of

this Agreement.

"Equipment" shall mean one or more items or units of personal property now

owned or hereafter acquired by Borrower, as described in each Equipment

Schedule, wherever the same may be located, including all present and future

additions, attachments, accessions and accessories thereto and all replacements,

substitutions and a right to use license for any software related to any of the

foregoing and proceeds thereof, including all proceeds of insurance thereon.

"Equipment Schedule" shall mean each Equipment Schedule, which

incorporates by reference the terms and conditions of this Agreement and

describes one or more items of Equipment and specific terms and conditions with

respect thereto.

"Event of Default" shall have the meaning ascribed to such term in Section

7 of this Agreement.

"Loan Agreement" shall mean the approval letter dated August 28, 2002 from

Lender to Borrower (the Approval Letter ) and this Agreement, as supplemented by

the applicable Equipment Schedules which incorporates the terms and conditions

of the Approval Letter and this Agreement, including all exhibits, addenda,

schedules, certificates, riders and all other documents and instruments executed

and delivered in connection therewith.

"Note" shall mean a promissory note of Borrower in favor of Lender

evidencing Borrower's obligations to Lender with respect to the Loan Agreement.

"Obligations" shall mean all liabilities in connection with the Loan

Agreement, absolute or contingent, joint, several or independent, of now or

hereafter existing, due or to become due to, or held or to be held by, Lender

for its

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MASTER LOAN AND SECURITY AGREEMENT

own account or as agent for another or others, whether created directly or

acquired by assignment or otherwise and howsoever evidenced, including, without

limitation, the Loan Agreement, and all interest, taxes, fees, charges, expenses

and Attorneys' Fees and Expenses chargeable to Borrower or incurred by Lender

under the Loan Agreement, or any other document or instrument delivered in

connection herewith.

"Person" shall mean any individual, partnership, joint venture, firm,

corporation, association, trust, or other enterprise or any government or

political subdivision or any agency, department or instrumentality thereof.

"Security Deposit" with respect to each item of Equipment shall have the

meaning assigned to such term in the Equipment Schedule applicable to such item

of Equipment.

"UCC" shall mean the Uniform Commercial Code as enacted in the

Commonwealth of Virginia.

2. LOAN; CONDITIONS; SECURITY INTEREST.

(a) Loan. Lender shall, subject to compliance by Borrower with the terms

and conditions hereof, make advances to Borrow from time to time in an amount up

to $6,500,000 for the purchase of Equipment and as set forth in the Approval

Letter, other soft expenses related to such Equipment for the internal use of

Borrower.

(b) Conditions. Lender shall not be obligated to make any loan hereunder

unless: (i) the Note or Equipment Schedule evidencing such loan shall have been

duly executed and delivered to Lender; (ii) Borrower shall have executed and

delivered to Lender the Equipment Schedule describing the Collateral and stating

the location thereof; (iii) Lender shall have received evidence that insurance

has been obtained in accordance with the provisions hereof; (iv) Lender shall

have received any and all third party consents, waivers or releases deemed

necessary or desirable in Lender's reasonable judgment in connection with the

loan and the Collateral being financed, including without limitation Uniform

Commercial Code lien releases and the consent and waiver, in form and substance

satisfactory to Lender, of each and every realty owner, landlord and mortgagee

holding an interest in or encumbrance on the real property where any of the

Collateral is to be located; (v) all filings, recordings and other actions

deemed necessary or desirable by Lender in order to establish, protect, preserve

and perfect its security interest in the Collateral being financed by such loan

as a valid perfected first priority security interest shall have been duly

effected, including without limitation the filing of financing statements and

the recordation of landlord (owners) and/or mortgagee waivers or disclaimers,

all in form and substance satisfactory to Lender, and all fees, taxes and other

charges relating to such filings and recordings shall have been paid by

Borrower; (vi) the representations and warranties of Borrower hereunder and

under the Loan Agreement shall be true and correct in all respects on and as of

the date of the making of any advance hereunder with the same effect as if made

on and as of such date; (vii) in the sole and good faith judgment of Lender,

there shall have been no material adverse change in the financial condition,

business, operations, prospects, product development, technology, or business or

contractual relations with third parties of Borrower from the date hereof and no

change or event shall have occurred which would impair the ability of Borrower

to perform its obligations hereunder or under any of the other Financing

Agreements to which it is a party or of Lender to enforce the Obligations or

realize upon the Collateral; (viii) all documents and agreements shall be

satisfactory to Lender and its attorneys; (ix) Lender shall have received, in

form and substance satisfactory to Lender, such other documents as Lender shall

require; and (x) no Default, Event of Default, or circumstance or facts that

would (with the giving of notice or the passage of time or both) become a

Default or Event of Default hereunder shall have occurred and be continuing.

(c) Security Interest. As security for the due and punctual payment of any

and all of the present and future Obligations of Borrower to Lender, Borrower

hereby (i) grants to Lender with respect to each Loan Agreement and for the full

amount of all Obligations, a security interest in all of the Collateral and all

collateral securing any other lease or security agreement between Borrower and

Lender, whether now in existence or hereafter entered into, to the extent the

Obligations herein remain unsatisfied, and (ii) assigns to Lender all of its

rights, title and interest in surplus money to which Borrower may be entitled

upon the sale of all such Collateral, to the extent the Obligations herein

remain unsatisfied. The extent to which Lender's security interest in any item

of Collateral shall be entitled to purchase money priority shall be determined

by reference to the unpaid principal balance of any Note evidencing the

financing of the purchase price of such item of Equipment.

3. ACCEPTANCE OF EQUIPMENT. The Equipment is to be delivered and installed

at the location specified or referred to in the applicable Equipment Schedule.

The Equipment shall be deemed to have been accepted by Borrower for all purposes

under this Agreement upon Borrower's execution of an Equipment Schedule (the

"Acceptance Date"). Lender shall not be liable or responsible for any failure or

delay in the delivery of the Equipment to Borrower for whatever reason.

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MASTER LOAN AND SECURITY AGREEMENT

4. TERM; INTEREST RATE; PRINCIPAL AND INTEREST; PREPAYMENT; LATE CHARGES.

(a) Term and Interest. The term and interest for any advance shall be as

specified in the applicable Equipment Schedule and in accordance with the

Approval Letter.

(b) Payment Dates. Principal and interest payments for each advance shall

be paid monthly, in advance in accordance with the schedule set forth in the

applicable Equipment Schedule. The first and last monthly payments shall be made

on the day the funds are advanced to Borrower.

(c) Prepayment. Provided that an Event of Default has not occurred or is

continuing to occur, and the Borrower has timely paid at least the first twelve

(12) monthly payments due under the Loan Agreement, Borrower shall have the

ability under the circumstances of a corporate merger or acquisition resulting

in a change of control of at least 50% of the outstanding voting stock, upon at

least (30) days prior written notice to Lender, to prepay any and all amounts

outstanding under the Loan Agreement on the periodic installment due date

designated in such notice by paying to the Lender, the sum of (i) the then

outstanding principal balance plus interest and all other amounts owing under

the Loan Agreement (calculated on a simple interest basis) plus (ii) a premium

of 5% if such prepayment shall occur in Year 2, a premium of 4% if such

prepayment shall occur in Year 3 and a premium of 3% if such prepayment shall

occur in Year 4 and thereafter. The premium applicable will be calculated on the

then outstanding principal balance. Year 1 will mean the period consisting of

the 1st through the 12th installments under the Loan Agreement and subsequent

years will refer to the subsequent twelve monthly payment periods. Principal and

interest payments shall be in the amounts and shall be due and payable as set

forth in the applicable Equipment Schedule.

(d) Late Charge. If any payment of principal or interest or other amount

payable hereunder shall not be paid within 5 days of the date when due, Borrower

shall pay as an administrative and late charge an amount equal to 4% of the

amount of any such overdue payment. In addition, Borrower shall pay overdue

interest on any delinquent payment or other amounts due under the Loan Agreement

(by reason of acceleration or otherwise) from the due date until paid at the

rate of one percent (1.0%) per month or the maximum amount permitted by

applicable law, whichever is lower. All payments to be made to Lender shall be

made to Lender in immediately available funds at the address shown above, or at

such other place, as Lender shall specify in writing.

5. REPRESENTATIONS, WARRANTIES AND COVENANTS. Borrower hereby represents

and warrants to and covenants with Lender (provided that if Borrower is an

individual or sole proprietorship, the representations, warranties and covenants

relating to corporate status shall not apply) that, as of the date hereof and

for so long as any Obligations shall remain outstanding:

(a) Borrower is duly organized and is existing in good standing under the

laws of its jurisdiction of organization and is duly qualified and in good

standing in those jurisdictions where the conduct of its business or the

ownership of its properties requires qualification;

(b) Borrower has the power and authority to own the Collateral, to enter

into and perform this Agreement and any other document or instrument delivered

in connection herewith and to incur the Obligations;

(c) Borrower's chief executive office is located at the address set forth

above;

(d) Borrower does not utilize, and has not in the last five years

utilized, any trade names in the conduct of its business except as set forth on

Schedule 1 hereto;

(e) Borrower has not changed its name, been the surviving entity in a

merger, acquired any business or changed the location of its chief executive

office within the previous five years, except as set forth on Schedule 2 hereto;

(f) Neither the execution, delivery or performance by Borrower of the Loan

Agreement nor compliance by it with the terms and provisions hereof, nor the

consummation of the transactions contemplated herein, (i) will contravene any

applicable provision of any law, statute, rule or regulation, or any order,

writ, injunction or decree of any court or governmental instrumentality, (ii)

will conflict or be inconsistent with or result in any breach of any of the

terms, covenants, conditions or provisions of, or constitute a default under, or

result in any lien upon any property, pursuant to the terms of any indenture,

mortgage, deed of trust, loan agreement or any other material agreement or

instrument to which Borrower is a party or by which it or any of its property or

assets are bound or to which it may be subject or (iii) will violate any

provision of its Certificate of Incorporation or By-Laws, or other governance

documents;

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MASTER LOAN AND SECURITY AGREEMENT

(g) The Loan Agreement, the Note and any document or instrument delivered

in connection herewith and the transactions contemplated hereby or thereby are

duly authorized, executed and delivered, and the Loan Agreement, the Note and

such other documents and instruments constitute valid and legally binding

obligations of Borrower and are enforceable against Borrower in accordance with

their respective terms;

(h) No order, consent, approval, license, authorization, or validation of,

or filing (except with respect to UCC filings), recording or registration with,

or exemption by any governmental or public body or authority, or any subdivision

thereof, is required to authorize or required in connection with (i) the grant

by Borrower of the security interest in connection with the Loan Agreement, (ii)

the execution, delivery and performance of the Loan Agreement, (iii) the

legality, validity, binding effect or enforceability of the Loan Agreement or

(iv) the perfection or maintenance of the aforementioned lien and security

interest;

(i) Borrower has filed all federal, state and local tax returns and other

reports it is required to file, has paid or made adequate provision for payment

of all such taxes, assessments and other governmental charges, and shall pay or

deposit promptly when due all sales, use, excise, personal property, income,

withholding, corporate, franchise and other taxes, assessments and governmental

charges upon or relating to the manufacture, purchase, ownership, maintenance,

modification, delivery, installation, possession, condition, use, acceptance,

rejection, operation or return of the Equipment and, upon request by Lender,

Borrower will submit to Lender proof satisfactory to Lender that such payments

and/or deposits have been made;

(j) There are no pending or threatened actions or proceedings before any

court or administrative agency, an unfavorable resolution of which could have a

material adverse effect on Borrower's financial condition or operations;

(k) No representation, warranty or statement by Borrower contained in the

Loan Agreement or in any certificate or other document furnished or to be

furnished by Borrower pursuant to the Loan Agreement contains or at the time of

delivery shall contain any untrue statement of material fact, or omits, or shall

omit at the time of delivery, to state a material fact necessary to make it not

misleading;

(1) All financial statements delivered and to be delivered by Borrower to

Lender in connection with the execution and delivery of the Loan Agreement are

true and correct in all material respects and have been prepared in accordance

with generally accepted accounting principles, and at all times since the date

of the most recent financial statements, there has been no material change in

Borrower's financial affairs or business operations. Borrower shall furnish

Lender: (i) within 120 days after the last day of each fiscal year of Borrower,

a financial statement including a balance sheet, income statement, statement of

shareholders equity and statement of cash flows, each prepared in accordance

with generally accepted accounting principles consistently applied with a report

signed by an independent certified public accountant satisfactory to Lender;

(ii) within 45 days after the close of each quarter of each fiscal year of

Borrower, a financial statement including a balance sheet, income statement and

statement of cash flows, each prepared by Borrower in accordance with generally

accepted accounting principles consistently applied by Borrower and certified by

the chief financial officer of Borrower; (iii) promptly upon the request of

Lender, such tax returns or financial statements regarding any guarantor, if

any, of the Obligations of Borrower as Lender may reasonably request from time

to time; (iv) promptly upon request of Lender, in form satisfactory to Lender,

such other and additional information as Lender may reasonably request from time

to time, and; (v) promptly inform Lender of any Defaults (defined below) or any

events or changes in the financial condition of Borrower occurring since the

date of the last financial statements of Borrower delivered to Lender which,

individually or cumulatively, when viewed in light of prior financial

statements, may result in a material adverse change in the financial condition

of Borrower;

(m) Borrower shall permit Lender, through its authorized attorneys,

accountants and representatives, to inspect and examine the Equipment and the

books, accounts, records, ledgers and assets of every kind and description of

Borrower with respect thereto at all reasonable times; provided, however, that

the failure of Lender to inspect the Equipment or to inform Borrower of any

noncompliance shall not relieve Borrower of any of its Obligations hereunder;

(n) Borrower is the owner of the Equipment free and clear of all rights,

title, security interests, encumbrances or liens of any other party, will defend

the Equipment against all claims and demands of all persons at any time claiming

any interest therein and shall deliver to Lender any and all evidence of

ownership of, and certificates of title to, any and all of the Equipment;

(o) The Equipment is personal property and not a fixture under the law of

the jurisdiction in which the Equipment is located even though the Equipment may

hereafter become attached or affixed to real property;

(p) Each site where Equipment is located, if not owned by Borrower, is

leased by Borrower pursuant to a valid lease or rental agreement which permits

the possession, use and operation of the Equipment at such location;

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MASTER LOAN AND SECURITY AGREEMENT

(q) Borrower shall provide Lender with disclaimers and waivers from

landlords, mortgagees and other persons holding any interest or claim in and to

any premises where Equipment is located, acceptable in all respects to Lender,

which may be necessary or advisable in the sole discretion of Lender to confirm

that the first priority security interest and rights of Lender in the Equipment

are and will remain valid and superior against all other parties;

(r) The Equipment is in the possession of Borrower at the location(s)

specified in the applicable Equipment Schedule, and shall not be removed from

such location without 30 days written notice to Lender and the subsequent prior

written consent of Lender, which consent shall not be unreasonably withheld and

shall in any event be conditioned upon Borrower having completed all

notifications, filings, recordings, and other actions in such new location as

Lender may require to protect and perfect Lender's interests in the Collateral;

(s) Borrower shall not, without the prior written consent of Lender, sell,

offer to sell, lease, rent, hire or in any other manner dispose, transfer or

surrender use and possession of any Equipment;

(t) Borrower will not, directly or indirectly, create, incur or permit to

exist any lien, encumbrance, mortgage, pledge, attachment or security interest

on or with respect to the Equipment other than in connection with the execution

and delivery of the Loan Agreement;

(u) Borrower shall permit each item of Equipment to be used only within

the continental United States by qualified personnel solely for business

purposes and the purpose for which it was designed and, at its sole expense,

shall service, repair, overhaul and maintain each item of Equipment in the same

condition as when received, ordinary wear and tear excepted, in good operating

order, consistent with prudent industry practice (but, in no event less than the

same extent to which Borrower maintains other similar equipment in the prudent

management of its assets and properties) and in compliance with all applicable

laws, ordinances, regulations, and conditions of all insurance policies required

to be maintained by Borrower under the Loan Agreement and all manuals, orders,

recommendations, instructions and other written requirements as to the repair

and maintenance of such item of Equipment issued at any time by the vendor

and/or manufacturer thereof;

(v) If any item of Equipment does not comply with the requirements of the

Loan Agreement, Borrower shall bring such Equipment into compliance with the

provisions hereof; and Borrower shall not use any Equipment, nor allow the same

to be used, for any unlawful purpose;

(w) Borrower acknowledges that Lender has not selected, manufactured or

supplied the Equipment to Borrower and has acquired any Equipment subject hereto

solely in connection with this Loan Agreement and Borrower has received and

approved the terms of any purchase order or agreement with respect to the

Equipment; and

(x) Borrower has all permits, licenses and other authorizations which are

required with respect to its business under Environmental Laws (as defined

below) and is in compliance with all terms and conditions of such permits,

licenses and other authorizations, including all limitations, restrictions,

standards, prohibitions, requirements, obligations, schedules and timetables.

The Borrower is not presently in violation of any Environmental Laws.

"Environmental Laws" shall mean any Federal, state or local law relating to

releases or threatened releases of Hazardous Substances; the manufacture,

handling, transport, use, treatment, storage or disposal of Hazardous Substances

or materials containing Hazardous Substances; or otherwise relating to pollution

of the environment or the protection of human health. "Hazardous Substances"

shall mean substances or materials which contain substances defined in or

regulated as toxic or hazardous materials, chemicals, substances, waste or

pollutants under any present or future Federal statutes and their state

counterparts, as well as any implementing regulations as amended from time to

time and as interpreted by administering agencies.

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MASTER LOAN AND SECURITY AGREEMENT

6. RISK OF LOSS AND DAMAGE; INSURANCE. Borrower assumes all risk of loss,

damage or destruction to the Equipment from whatever cause and for whatever

reason. If all or a potion of an item of Equipment shall become lost, stolen,

destroyed, damaged beyond repair or rendered permanently unfit for use for any

reason, or in the event of any condemnation, confiscation, theft or seizure or

requisition of title to or use of such item of Equipment, Borrower shall

immediately pay to Lender an amount equal to the outstanding principal balance

of and accrued and unpaid interest on any Note with respect to such Equipment,

less the net amount of the recovery, if any, received by Lender from insurance

on the Equipment. For so long as any Obligations shall remain outstanding,

Borrower shall procure and maintain insurance in such amounts and with such

coverages, and upon such terms and with such companies, as Lender may reasonably

approve, consistent with normal/prudent industry practices, at Borrower's

expense; provided, however, that in no event shall such insurance be less than

the following coverages and amounts: (a) worker's compensation and Employer's

Liability Insurance, in the full statutory amounts provided by law; (b)

Comprehensive General Liability Insurance including product/completed operations

and contractual liability coverage, with minimum limits on a per occurrence

basis, as reasonably required by Lender, and Combined Single Limit Bodily Injury

and Property Damage on an aggregate basis, as reasonably required by Lender or,

in either case, as otherwise specified in any Equipment Schedule hereto; and (c)

All Risk Physical Damage Insurance, including earthquake and flood, on each item

of Equipment, in an amount not less than the greater of (i) the outstanding

principal balance owing under any Note with respect to such Equipment; or (ii)

its full replacement value. Borrower shall cause Lender to be included as an

additional insured on each such Comprehensive General Liability Insurance

policy. On each such All Risk Physical Damage Insurance policy Lender shall be

named as loss payee. Such policies shall be endorsed to provide that the

coverage afforded to Lender shall not be rescinded, impaired or invalidated by

any act or neglect of Borrower. Borrower agrees to waive Borrower's rights and

its insurance carrier's rights of subrogation against Lender for any and all

loss or damage. In addition to the foregoing minimum insurance coverage,

Borrower shall procure and maintain such other insurance coverage as Lender may

reasonably require, consistent with normal/prudent industry practices. All

policies shall be endorsed or contain a clause requiring the insurer to furnish

Lender with at least 30 days prior written notice of any material change,

cancellation or non-renewal of coverage. Upon execution of this Agreement, and

thereafter, 30 days prior to the expiration of each insurance policy required

hereunder, Borrower shall furnish Lender with a certificate of insurance or

other evidence satisfactory to Lender that the insurance coverages required

under such policy are and will continue in effect, provided, however, that

Lender shall be under no duty either to ascertain the existence of or to examine

such insurance coverage or to advise Borrower in the event such insurance

coverage should not comply with the requirements hereof. If Borrower shall at

any time or times hereafter fail to obtain and/or maintain any of the policies

of insurance required herein, or fail to pay any premium in whole or in part

relating to any such policies, Lender may, but shall not be obligated to, obtain

and/or cause to be maintained insurance coverage with respect to the Collateral,

including, at Lender's option, the coverage provided by all or any of the

policies of Borr