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                                                                   EXHIBIT 10.5

                        COLLABORATIVE RESEARCH AGREEMENT

     This Collaborative Research Agreement (the "Agreement") is made as of the
24th day of March, 1999 ("Effective Date"), by and between Telik, Inc., a
Delaware corporation having a place of business at 750 Gateway Boulevard, South
San Francisco, California 94080, U.S.A. ("Telik") and Sankyo Company, Ltd., a
Japanese corporation having a place of business at 5-1, Nihonbashi Honcho 3-
chome, Chuo-ku, Tokyo 103-8426, Japan ("Sankyo").  Telik and Sankyo shall be
referred to herein individually as a "Party" and collectively as the "Parties."

                               Recitals

     Whereas, Telik possesses a library of compounds ("Telik Library") and
proprietary technology which enables it to classify and search compounds
according to their protein-binding capabilities ("TRAP Technology");

     Whereas, Sankyo has certain biological targets ("Sankyo Targets") for which
it desires to find activity-modulating compounds; and

     Whereas, Sankyo wishes to evaluate the ability of the Telik Library and
TRAP Technology to identify compounds that affect Sankyo Targets and that may
lead to candidates for pharmaceutical development;

     Now, Therefore, in consideration of the foregoing premises and the
covenants set forth below, the parties hereby agree as follows:

1.   [ * ]  Fee.

     1.1  Payment of Fee.  Sankyo shall pay Telik a [*] [*] in [*] [*],
and [*].  Telik shall send invoices to Sankyo [*] to the [*].  The
installment payments shall be made in U.S. dollars by wire transfer to a bank
account to be specified by Telik.

     1.2  Taxes.  Sample Supply Fee payments shall be made without deduction
other than such amount (if any) Sankyo is required by law to deduct or withhold.
If the Sample Supply Fee is subject to such deductions or other withholdings, it
shall be increased by an amount which shall equal, as nearly as possible, the
amount required to be deducted or withheld.

2.   Screening Activity.

     2.1  Screening Term.  The term during which Sankyo may perform the
screening activities set forth in this Article 2 (the "Screening Term") shall
begin on the Effective Date and

[*] CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
    BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
    EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE sECURITIES ACT OF 1933, AS
    AMENDED.

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expire [ * ] later, provided however, that if Sankyo elects to choose Substitute
Selected Targets as provided in Section 2.4(a)(i), the Screening Term shall be
extended as described therein.

     2.2  Target Selection. During the first [ * ] of the Screening Term,
Sankyo may notify Telik in writing of Sankyo Targets against which Sankyo wishes
to screen compounds provided by Telik ("Proposed Targets").  Sankyo's
notification must provide the molecular identity of the Proposed Targets and
such other information as Telik may reasonably request to permit Telik to
confirm that none of such Proposed Targets is identical to, overlapping or
otherwise in conflict with (i) targets included in, or subject to any then-
existing restriction resulting from, any research collaboration between Telik
and a third party or (ii) targets that Telik was already actively pursuing prior
to receipt of Sankyo's notice (collectively, "Reserved Targets").  Telik shall
notify Sankyo in writing whether or not each Proposed Target is a Reserved
Target.  If a Proposed Target is not a Reserved Target, then the Proposed Target
will be deemed a "Selected Target" upon dispatch of Telik's notification.  Telik
shall list all Proposed Targets in the Appendix to this Agreement and shall
update such Appendix, as necessary, to indicate whether a Proposed Target
becomes a Selected Target and to delete all Reserved Targets.  Sankyo may
designate no more than ten (10) Selected Targets.

     2.3  Active Molecule Criteria.  Prior to the initiation of compound
screening against each Selected Target, the Parties will agree on the screening
results required for a compound provided by Telik as set forth in Section 2.4 to
be classified as an "Active Molecule."

     2.4  Screening Activity and Data Collection.

          (a)  Within [ * ] of the later of (i) the date that a Proposed Target
is deemed a Selected Target or (ii) the Parties' agreement regarding the Active
Molecule criteria for that Selected Target, Telik shall, based upon its
knowledge of the Telik Library and using the TRAP Technology, select and provide
to Sankyo approximately [ * ] compounds ("Initial Compounds") from the Telik
Library that Telik believes, in its sole discretion, represent maximum chemical
compound diversity in the Telik Library.  Telik shall provide such Initial
Compounds in quantities of approximately [ * ] per Initial Compound, per
Selected Target.  Sankyo shall screen each Initial Compound for activity in
relation to the Selected Target and provide all data (including but not limited
to the concentration at which a compound elicits a response which is 50% of the
maximum response in the assay being applied (the "EC\50\") for each Initial
Compound) resulting therefrom ("Initial Results") to Telik within [ * ] of
Sankyo's receipt of the Initial Compounds.  Sankyo hereby covenants that it will
not use the Initial Compounds for any purpose other than that set forth in this
Section 2.4(a), it will cease using the Initial Compounds after completion of
testing as set forth in this Section 2.4(a), and it will store and return unused
Initial Compounds as set forth in Section 2.4(f).

               (i) If none of the Initial Compounds has an EC\50\ equal to or
less than [ * ] or the Initial Results otherwise contain insufficient useful
information for Telik to select Secondary Compounds pursuant to Section 2.4(b),
then Telik will provide Sankyo with another set of Initial Compounds (the
"Substitute Initial Compounds"), in quantities of approximately [ * ] per
Substitute Initial Compound, per Selected Target. The Substitute Initial
Compounds shall be treated by both Parties as if they were Initial Compounds;
provided, however, that if none of

[*] CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE sECURITIES ACT OF 1933, AS
AMENDED.

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the Substitute Initial Compounds has an EC\50\ equal to or less than [ * ] or
the Initial Results from the Substitute Initial Compounds otherwise contain
insufficient useful information for Telik to select Secondary Compounds, then

                   (1) Telik shall not be obligated to provide any additional
Compounds to Sankyo with respect to the relevant Selected Target, and Telik's
obligations under Article 5 with respect to such Selected Target shall
terminate; and

                   (2) Sankyo may, at its election, not later than [ * ] after
Telik's receipt of the Initial Results for the Substitute Initial Compounds for
a particular Selected Target, choose a new target in substitution for such
Selected Target ("Substitute Selected Target"), not to exceed ten (10)
Substitute Selected Targets in the aggregate. The Substitute Selected Targets
shall be treated by both Parties as if they were Selected Targets. If Sankyo
exercises its right to choose a Substitute Selected Target, the Screening Term
shall be extended as necessary to complete the screening process for such
Substitute Selected Target within the schedule described in this Article 2, but
in no event shall the Screening Term be extended by more than [ * ].

          (b)  Within [ * ] after receipt of the Initial Results, Telik shall,
based upon the Initial Results and using the TRAP Technology or any other search
technology available to Telik, select and provide to Sankyo an appropriate
number of additional compounds ("Secondary Compounds") from the Telik Library
that Telik believes, in its sole discretion, will exhibit the greatest
likelihood of activity in relation to the Selected Target.  Sankyo shall screen
each Secondary Compound for selected activity in relation to the Selected Target
and provide all data (including but not limited to the EC\50\ for each Secondary
Compound) resulting therefrom ("Secondary Results") to Telik within [ * ] of
Sankyo's receipt of the Secondary Compounds.  Sankyo hereby covenants that it
will not use the Secondary Compounds for any purpose other than that set forth
in this Section 2.4(b), it will cease using the Secondary Compounds after
completion of testing as set forth in this Section 2.4(b), and it will store and
return unused Secondary Compounds as set forth in Section 2.4(f).

          (c)  Within [ * ] after receipt of the Secondary Results, Telik shall,
based upon the Secondary Results and using the TRAP Technology or any other
search technology available to Telik, select and provide to Sankyo [ * ]
additional compounds ("Tertiary Compounds") from the Telik Library that Telik
believes, in its sole discretion, will exhibit the greatest likelihood of
activity in relation to the Selected Target.  Sankyo shall screen each Tertiary
Compound for selected activity in relation to the Selected Target and provide
all data (including but not limited to the EC\50\ for each Tertiary Compound)
resulting therefrom ("Tertiary Results") to Telik within [ * ] of Sankyo's
receipt of the Tertiary Compounds.  Sankyo hereby covenants that it will not use
the Tertiary Compounds for any purpose other than that set forth in this Section
2.4(c), it will cease using the Tertiary Compounds after completion of testing
as set forth in this Section 2.4(c), and it will store and return unused
Tertiary Compounds as set forth in Section 2.4(f).

          (d)  If Sankyo and Telik jointly determine that further screening
activity is necessary, then based upon the Tertiary Results and using the TRAP
Technology or any other search technology available to Telik, Telik shall select
and provide to Sankyo [ * ] additional compounds ("Quaternary Compounds") from
the Telik Library that Telik believes, in its sole

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BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE sECURITIES ACT OF 1933, AS
AMENDED.

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discretion, will exhibit the greatest likelihood of assay activity in relation
to the Selected Target. Sankyo will screen each Quaternary Compound for selected
activity in relation to the Selected Target and provide Telik all data
(including but not limited to the EC\50\ for each Quaternary Compound) resulting
therefrom ("Quaternary Results") to Telik within [ * ] of Sankyo's receipt of
the Quaternary Compounds. Sankyo hereby covenants that it will not use the
Quaternary Compounds for any purpose other than that set forth in this Section
2.4(d), it will cease using the Quaternary Compounds after completion of testing
as set forth in this Section 2.4(d), and it will store and return unused
Quaternary Compounds as set forth in Section 2.4(f).

          (e)  The total number of Initial Compounds, Secondary Compounds,
Tertiary Compounds and Quaternary Compounds provided by Telik pursuant to this
Section 2.4 (collectively, the "Provided Compounds") shall be in the range of
approximately [ * ] to approximately [ * ] Provided Compounds per Selected
Target.  Telik shall provide to Sankyo any information Telik may have in its
possession regarding appropriate usage and handling of the Provided Compounds
concurrent with the delivery to Sankyo of such Provided Compounds.

          (f)  Beginning with receipt by Sankyo and continuing through the
completion of testing under Section 2.4(a), 2.4(b), 2.4(c) or 2.4(d), Sankyo
shall store any unused Initial Compounds, Secondary Compounds, Tertiary
Compounds or Quaternary Compounds, as applicable, in a secure location. Within
[ * ] of the completion of screening against a Selected Target, Sankyo will
return to Telik all unused Provided Compounds for that Selected Target unless
specifically authorized by Telik, in writing, to do otherwise.

3.   Identification and Disclosure of Chemical Structures.

     3.1  Not later than [ * ] after sending the Tertiary Results or, if
applicable, the Quaternary Results to Telik, Sankyo shall provide Telik with a
written list of the Provided Compounds in which Sankyo has an interest.  Telik
shall determine which of these Provided Compounds qualify as Active Molecules
and shall provide to Sankyo the two dimensional representations of the chemical
structures of the Active Molecules on Sankyo's list (the "Disclosed Active
Molecules").  In addition, to provide Sankyo with additional information for
evaluating the potential of the Disclosed Active Molecules, Telik may also
provide the two dimensional representations of the chemical structures of
certain other Provided Compounds, selected by Telik in its sole discretion, that
did not qualify as Active Molecules.  Sankyo will use the structural information
provided by Telik solely to evaluate whether it wishes to exercise its option,
set forth in Section 4.1, for a license to develop and commercialize such
Disclosed Active Molecules.  Sankyo hereby covenants that it will not use the
structural information for any other purpose.  If Sankyo does not submit to
Telik a written list of the Provided Compounds in which Sankyo has an interest
within the time permitted under this Section 3.1, Telik's obligations under
Article 5 with respect to the relevant Selected Target shall terminate.

     3.2  The parties anticipate that Telik will be conducting research
collaborations with third parties during the Screening Term with respect to
targets other than Selected Targets.  Telik will not provide to Sankyo under
Section 2.4 compounds as to which a third party has exercised an option to
obtain or has obtained license rights, or which has otherwise been reserved by a
third party ("Reserved Compound").  Nonetheless, the parties acknowledge that
the compounds provided to Sankyo under this Agreement may include compounds
provided to third parties

[*] CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE sECURITIES ACT OF 1933, AS
AMENDED.

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under research collaborations or similar arrangements with such third parties.
Accordingly, a third party may, while Sankyo is screening a particular compound,
designate that compound a Reserved Compound. In such event, Telik will promptly
inform Sankyo that such compound has become a Reserved Compound, and all of
Sankyo's rights regarding that Reserved Compound, including those rights set
forth in Articles 2, 3 and 4, shall terminate. In no event will Telik provide
Sankyo with the chemical structure of such Reserved Compound. In the event that
a third party terminates or otherwise waives its rights to a Reserved Compound
that Sankyo has screened and which qualifies as an Active Molecule, Telik will
notify Sankyo that such compound is no longer a Reserved Compound and Sankyo may
elect, in its discretion and by written notice to Telik, to receive the two
dimensional representation of its chemical structure from Telik. Such compound
shall thereafter be deemed a Disclosed Active Molecule subject to Section 3.1
and Article 4.

4.   Option for Development and Commercialization License.

     4.1  License Option.  Effective upon Telik's delivery to Sankyo of the
structures of all of the Disclosed Active Molecules for a particular Selected
Target (the "Option Effective Date"), Telik hereby grants to Sankyo an option to
acquire an exclusive, worldwide license to develop and commercialize any or all
Disclosed Active Molecules for such Selected Target (the "License Option").  The
term of such option shall commence on the Option Effective Date and expire [ * ]
thereafter (the "Option Term").

     4.2  Exercise of License Option.  Sankyo shall exercise the License Option
described in Section 4.1 by (i) providing written notice to Telik, prior to the
expiration of the Option Term, identifying each Disclosed Active Molecule to
which Sankyo desires to procure a license (a "Sankyo-Reserved Molecule") and
(ii) negotiating and entering into a mutually agreed license agreement (the
"License Agreement") as set forth in Section 4.4 within [ * ] of the Option
Effective Date.

     4.3  Consolidation of Licensing Negotiations.  To facilitate the execution
of a single License Agreement covering Sankyo-Reserved Molecules related to more
than one Selected Target, Telik may, in its sole discretion, agree to extend the
negotiation period for a Selected Target if Sankyo provides, during the
negotiation period for that Selected Target, timely written notification of its
desire to procure a license for Disclosed Active Molecules related to one or
more additional Selected Targets.  As a result of such an extension, the parties
will have until [ * ] after the Option Effective Date for the last Selected
Target as to which Sankyo has provided timely notification under Section 4.2 to
negotiate and execute a License Agreement covering all such Selected Targets.

     4.4  License Agreement.  If Sankyo exercises the License Option, Telik
intends to provide Sankyo with exclusive, worldwide rights to all know-how and
under all patents, patent applications and patent claims owned by Telik to the
extent necessary or useful to the development and commercialization of products
that, in the course of their discovery, development or production, utilize or
incorporate the relevant Licensed Active Molecule (as defined below) or a
derivative thereof.  To this end, in the License Agreement Telik shall grant to
Sankyo an exclusive, worldwide license (with the right to sublicense) to make,
have made, use, import, offer for sale and sell such products.  The License
Agreement shall contain such other

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BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE sECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE sECURITIES ACT OF 1933, AS
AMENDED.

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terms as are consistent with terms then-applied to products of similar market
potential arising out of or developed in the biopharmaceutical industry,
provided however that (i) the royalty rate payable to Telik on net sales of
products to be developed and commercialized under such license shall not exceed
[ * ]; and (ii) except for any patents or patent applications assigned to Sankyo
under such a License Agreement, in the event that any inventions arise out of
the development and commercialization of products incorporating the relevant
Licensed Active Molecule or a derivative thereof, inventions made by either
party shall be owned by the party that made such inventions and inventions made
jointly by the parties shall be owned jointly by the parties. Upon the execution
of a License Agreement, any Sankyo-Reserved Molecule that is subject to the
License Agreement shall become a "Licensed Active Molecule." If Sankyo prefers
the assignment by Telik of certain patent application(s) or patent(s) in lieu of
an exclusive license for such applications or patents, Telik is willing to
consider such a request during the negotiation of the License Agreement.

5.   Exclusivity.

     5.1  [ * ].  Commencing [ * ], Telik shall not thereafter perform [ * ]
other than that [ * ] which is within the scope of this Agreement, until the
earlier of (i) [ * ], (ii) [ * ], (iii) [ * ] of the [ * ] a [ * ] as described
in Sections [ * ], (iv) [ * ]; or (v) [ * ].

     5.2  Sankyo-Reserved Molecules. Upon receipt of Sankyo's notice pursuant to
Section 4.2, Telik shall remove each Sankyo-Reserved Molecule identified in such
notice from the Telik Library, and shall not conduct or permit to be conducted,
or grant any third party the right to conduct, any research, development or
commercialization of such Sankyo-Reserved Molecules, provided that:

          (a) Telik's obligations under this Article 5 with respect to any
Sankyo-Reserved Molecule not then the subject of an executed License Agreement
shall terminate [ * ] after the Option Effective Date for the relevant Selected
Target (or, if Telik grants an extension pursuant to Section 4.3, [ * ] after
the Option Effective Date for the last Selected Target as to which Sankyo
provided timely notification under Section 4.2).  Telik shall thereafter be free
to conduct or grant any third party the right to conduct research, development
and commercialization activities with respect to such Sankyo-Reserved Molecules.

          (b) Telik's obligations under this Article 5 with respect to any
Selected Target for which no Sankyo-Reserved Molecule is then the subject of an
executed License Agreement shall terminate [ * ] after the Option Effective Date
for such Selected Target (or, if Telik grants an extension pursuant to Section
4.3, [ * ] after the Option Effective Date for the last Selected Target as to
which Sankyo provided timely notification under Section 4.2).  Telik shall
thereafter be free to conduct or grant any third party the right to conduct
research, development and commercialization activities with respect to such
Selected Target, and Sankyo shall be free to conduct or grant any third party
the right to conduct research, development and commercialization activities with
respect to such Selected Target.

6.   Ownership of Data and Intellectual Property.

[*] CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS
AMENDED.

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     6.1  Data Ownership.  Prior to the expiration of the License Option for all
Disclosed Active Molecules for a Selected Target, the Initial Results, Secondary
Results, Tertiary Results, and Quaternary Results, if applicable, (the "Combined
Screening Results") pertaining to those Disclosed Active Molecules shall be
jointly owned by the Parties.  Upon the execution of a License Agreement
pursuant to Article 4, Telik shall grant to Sankyo the exclusive right to use
Telik's interest in the Combined Screening Results pertaining to the relevant
Licensed Active Molecules in the manufacture, use and sale of products
incorporating or based upon such Licensed Active Molecules, including analogues,
derivatives, or formulations thereof, and in the manufacture, use and sale of
products incorporating compounds identified via analysis of structure-activity
information gathered from the Combined Screening Results.  Upon the later of (i)
the expiration of the License Option for a Disclosed Active Molecule or (ii) the
passing of [ * ] from the Option Effective Date for a Sankyo-Reserved Molecule
(or, if Telik grants an extension pursuant to Section 4.3, [ * ] after the
Option Effective Date for the last Selected Target as to which Sankyo provided
timely notification under Section 4.2) for which no License Agreement was
executed, the Combined Screening Results pertaining to the Disclosed Active
Molecule or Sankyo-Reserved Molecule shall be solely owned by Telik;  Telik
shall have the right to use such Combined Screening Results for any purpose, and
Sankyo shall not have any right to use such Combined Screening Results.

     6.2  Ownership of Telik Library, Provided Compounds and TRAP Technology.
All right, title and interest in and to the Telik Library, Provided Compounds,
TRAP Technology, and any know-how, patents, or patent applications controlled by
Telik and pertaining to the above items shall remain exclusively with Telik,
subject only to the rights granted to Sankyo under Sections 2.4, 4.1, 4.4 and
5.2.  Sankyo agrees not to obtain or attempt to obtain patents on the Telik
Library, Provided Compounds, TRAP Technology, or use thereof without the express
written consent of Telik.

     6.3  Inventions. Notwithstanding the ownership of data set forth in Section
6.1, any inventions or discoveries (whether patentable or not) pertaining to,
and all information resulting directly from the activities of either party
pursuant to Articles 2 and 3 (the "Inventions"), will be solely owned by Telik.
Sankyo shall promptly disclose to Telik any Invention resulting from the
activities of Sankyo, its employees, agents or affiliates.  Sankyo agrees not to
obtain or attempt to obtain patents on the Inventions without the express
written consent of Telik.

          (a) Prior to the execution of a License Agreement pursuant to Article
4, Telik shall have the sole right to file, prosecute, maintain, enforce and
defend all patent applications and patents for Inventions and shall pay all
costs and fees incurred with respect to such activities.  Sankyo shall provide
Telik, at Telik's expense, any assistance reasonably requested by Telik for the
filing, prosecution, maintenance, enforcement or defense of such patents or
patent applications.  If Telik decides not to file a patent application for an
Invention and Sankyo so requests in writing, Telik shall file and prosecute such
a patent application and maintain any patent arising therefrom for so long as
Sankyo promptly pays all costs and fees incurred with respect to such activities
(including any costs associated with assistance provided by Sankyo at Telik's
request).  Telik shall not be obligated to file, prosecute or maintain any
patent application or patent for an Invention other than that for which Sankyo
has complied with the requirements set forth in the preceding sentence.  In no
event shall Telik be obligated to enforce or defend such

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BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS
AMENDED.

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patent application or patent for Inventions. Within [ * ] after the filing of a
patent application for an Invention, Telik shall provide Sankyo with written
notification that such filing has been made.

          (b)  Upon the execution of a License Agreement pursuant to Article 4,
Sankyo shall reimburse Telik for all patent filing, prosecution and maintenance
costs (including attorneys' fees) incurred by Telik as of the effective date of
such License Agreement regarding any patent or patent application for Inventions
licensed to Sankyo thereunder.  Thereafter, Sankyo shall promptly pay all patent
filing, prosecution and maintenance expenses for any patent or patent
application for Inventions licensed to Sankyo under the License Agreement.

7.   Representations and Warranties.

     7.1  Each Party represents and warrants to the other that:

          (a)  It will exercise due care in performing its obligations under the
Agreement.

          (b)  All documentation and other information conveyed by one Party to
another hereunder or in connection herewith, was, at the time it was conveyed or
provided, accurate and complete in light of the purposes for which it was
intended.

     7.2  THE PROVIDED COMPOUNDS ARE BEING SUPPLIED TO SANKYO ON AN "AS IS"
BASIS WITH NO WARRANTIES OF ANY KIND, EXPRESS OR IMPLIED, INCLUDING ANY WARRANTY
OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR THAT THEY ARE FREE
FROM THE RIGHTFUL CLAIM OF ANY THIRD PARTY, BY WAY OF INFRINGEMENT OR THE LIKE.
TELIK MAKES NO REPRESENTATIONS THAT USE OF THE PROVIDED COMPOUNDS WILL NOT
INFRINGE ANY PATENT OR OTHER PROPRIETARY RIGHTS OF ANY THIRD PARTIES.

8.   Acknowledgments and Covenants by Sankyo.

     8.1  Sankyo acknowledges and agrees that the Provided Compounds may have
biological and/or chemical properties that are unpredictable and unknown at the
time of transfer.  Sankyo hereby covenants that it will use the Provided
Compounds with caution and prudence and it will not use the Provided Compounds
for testing in or treatment of humans or in any other test not part of the
Appendix.

     8.2  Sankyo covenants that it will maintain reasonable security measures,
no less strict than it maintains to protect its own valuable tangible property,
against loss, theft or destruction of the Provided Compounds.

     8.3  Sankyo covenants that it shall not attempt to reverse engineer or
ascertain, by any means, the chemical structure or any other information
concerning any Provided Compound unless and until Telik has provided the
chemical structure to Sankyo.

9.   Confidentiality.

[*] CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES aCT OF 1933, AS
AMENDED.

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     9.1  Definition of Confidential Information.  "Confidential Information"
shall mean any and all knowledge, know-how, Proposed Targets, Selected Targets,
Combined Screening Results, structures of Provided Compounds, practices,
processes, or other information received by one Party from the other Party
pursuant to this Agreement.

     9.2  Nondisclosure of Confidential Information.  Except to the extent
expressly authorized by this Agreement or otherwise agreed in writing by the
Parties, the Parties agree that, for the term of this Agreement and for [ * ]
after its expiration or termination, the receiving Party shall keep confidential
and shall not publish or otherwise disclose and shall not use for any purpose
other than as provided for in this Agreement any Confidential Information,
hereinafter defined, furnished to it by the other Party pursuant to this
Agreement unless the receiving Party can demonstrate by competent written proof
that such Confidential Information:

          (a)  was already known to the receiving Party, other than under an
obligation of confidentiality, at the time of disclosure by the other Party;

          (b)  was generally available to the public or otherwise part of the
public domain at the time of its disclosure to the receiving Party;

          (c)  became generally available to the public or otherwise part of the
public domain after its disclosure and other than through any act or omission of
the receiving Party in breach of such Agreements;

          (d)  was disclosed to the receiving Party, other than under an
obligation of confidentiality to a third party, by a third party who had no
obligation to the disclosing Party not to disclose such information to others;
or

          (e)  was independently discovered or developed by the receiving Party
without the use of Confidential Information belonging to the disclosing Party.

[*] CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS
AMENDED.

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     9.3  Authorized Disclosure.  Each Party may disclose Confidential
Information belonging to the other Party to the extent such disclosure is
reasonably necessary in the following instances:

          (a)  Filing or prosecuting patents relating to Inventions or licensed
products;

          (b)  Regulatory filings;

          (c)  Prosecuting or defending litigation;

          (d)  Complying with applicable governmental regulations;

          (e)  Disclosure to Affiliates, sublicensees, employees, consultants,
or agents, each of whom prior to disclosure must be bound by similar obligations
of confidentiality and non-use at least equivalent in scope to those set forth
in this Article 9;

          (f)  Disclosure to investment bankers, investors, and potential
investors of information relevant to their assessment of the disclosing company,
such as the existence of the Agreement, the general nature of the diseases for
which targets have been selected, the number (but not the identity) of targets
selected and the status of the project on a per target basis (without
identifying the target); and

          (g)  Disclosure by Telik, more than [ * ] after the expiration of a
deadline applicable to Sankyo as set forth in Sections 4.1, 4.2 or 4.3 without
appropriate action or response by Sankyo, of the Combined Screening Results
against the relevant, identified Selected Target for a Disclosed Active
Molecule, to third parties interested in pursuing such Selected Target or
Disclosed Active Molecule, provided however, that Telik will not disclose to
such third party that Sankyo selected such Selected Target.

In any event, the Parties agree to take all reasonable action to avoid
disclosure of Confidential Information except as permitted hereunder.

[*] CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE sECURITIES ACT OF 1933, AS
AMENDED.

                                       10
<PAGE>

     9.4  Publicity.  Any publication, news release or other public announcement
relating to this Agreement or to the performance hereunder, shall be first
reviewed and approved by both Parties, which approval shall not be unreasonably
withheld.

10.  Term; Termination.

     10.1 Term.  This Agreement shall become effective as of the Effective Date
and unless earlier terminated as provided in this Article 10, shall expire on
the later of (i) the expiration of the time to enter all License Agreements
under Section 4.2, or (ii) thirty-six (36) months after the Effective Date.

     10.2 Termination for Default.  In the event that either party to this
Agreement shall be in default of any of its material obligations hereunder and
shall fail to remedy such default within [ * ] after receipt of written notice
thereof, the party not in default shall have the option of terminating this
Agreement by giving written notice thereof, notwithstanding anything to the
contrary contained in this Agreement.

     10.3 Effect of Termination.

          (a)  In General.  Termination of this Agreement shall not relieve the
Parties of any obligations accruing prior to such termination.  In the event of
termination by Telik pursuant to Section 10.2 as a result of Sankyo's default of
a material obligation, Sankyo shall pay Telik any Sample Supply Fee accrued at
the time of termination but not yet paid.  Except to the extent necessary to
allow the Parties to exploit their respective rights pursuant to Section 6,
promptly after termination of this Agreement each Party shall return or dispose
of any know-how of the other in accordance with the instructions of the other,
including without limitation any compounds, assays or other biological or
chemical materials.

          (b)  Default by Telik.  Following Sankyo's termination of this
Agreement pursuant to Section 10.2 as a result of Telik's default of a material
obligation, [ * ].  If, as of the date of termination, Sankyo has not made
payments to Telik equal to or greater than [ * ], Sankyo shall make such
additional payment to Telik within [ * ] of the effective date of termination.
If, as of the date of termination, Sankyo's payments total an amount greater
than [ * ], Telik shall refund to Sankyo any excess amounts within [ * ] of the
effective date of termination.  Telik shall (i) disclose to Sankyo the
structures for the Provided Compounds that have been tested by Sankyo and
qualify as Active Molecules as of the date of Sankyo's termination and (ii)
grant to Sankyo a nonexclusive, royalty-free, perpetual worldwide license (with
the right to sublicense) to develop and commercialize products that, in the
course of their discovery, development or production, utilize or incorporate
such Disclosed Active Molecules.

     10.4 Surviving Obligations. The terms of Articles 6 and 9 and Section 12.9
of this Agreement shall survive expiration or termination of this Agreement.

11.  Governing Law; Dispute Resolution.

     11.1 Governing Law.  This Agreement shall be governed by and construed in
accordance with the domestic laws of the State of California, (i) without giving
effect to any choice or conflict of law provision or rule that would cause the
application of the laws of any

[*] CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS
AMENDED.

                                       11
<PAGE>

jurisdiction other than the State of California, and (ii) except that the rights
of the parties to resolve by arbitration any dispute arising between them
regarding the subject matter of this Agreement shall not be governed by the
California arbitration act or international arbitration act (Cal. Code of Civ.
Proc. (S) 1280 et seq. and 1297.11 et seq.) but rather by the United States
Arbitration Act (9 U.S.C. (S)(S) 1-14, 201-208).

     11.2 Dispute Resolution.  In the event of any controversy or claim arising
out of, relating to or in connection with any provision of this Agreement, the
Parties shall try to settle their differences amicably and in good faith between
themselves first, by referring the disputed matter to the respective heads of
research of each Party and, if not resolved by the research heads, by referring
the disputed matter to the respective Chief Executive Officer of each Party.  In
the event such executives are unable to resolve such dispute within such thirty
(30) day period, either Party may invoke the provisions of Section 11.3.

     11.3 Arbitration.  Upon failure to resolve any controversy or claim
arising out of, relating to or in connection with any provision of this
Agreement using the dispute resolution procedure described in Section 11.2, and
except as provided in Section 11.3(c) below, any dispute, controversy or claim
arising out of or relating to the validity, construction, enforceability or
performance of this Agreement, including disputes relating to alleged breach or
to termination of this Agreement, other than disputes which are expressly
prohibited herein from being resolved by this mechanism, shall be settled by
binding Alternative Dispute Resolution ("ADR") in the manner described below:

          (a)  If a party intends to begin an ADR to resolve a dispute, such
party shall provide written notice (the "ADR Request") to counsel for the other
party informing such other party of such intention and the issues to be
resolved.  From the date of the ADR Request and until such time as any matter
has been finally settled by ADR, the running of the time periods contained in
Article 10 as to which a party must cure a breach of this Agreement shall be
suspended as to the subject matter of the dispute.

          (b)  Within ten (10) business days after the receipt of the ADR
Request, the other party may, by written notice to the counsel for the party
initiating ADR, add additional issues to be resolved.

          (c)  Any dispute regarding the validity or enforceability of a patent
or trademark applicable to a product shall be submitted to a court of competent
jurisdiction in the country in which such patent or trademark right exists.

[*] CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS
AMENDED.

                                       12
<PAGE>

     11.4 Procedure. The ADR shall be conducted pursuant to JAMS/ENDISPUTE
Rules A and C then in effect.  Notwithstanding those rules, the following
provisions shall apply to the ADR hereunder.

          (a)  Arbitrator.  The arbitration shall be conducted by a panel of
three arbitrators ("the Arbitrators").  The Arbitrators shall be selected from a
pool of retired independent federal judges to be presented to the parties by
JAMS/ENDISPUTE.  Neither party shall engage in ex parte contact with the
arbitrator.

          (b)  Proceedings. The time periods set forth in the JAMS/ENDISPUTE
rules shall be followed, unless a party can demonstrate to the Arbitrator that
the complexity of the issues or other reasons warrant the extension of one or
more of the time tables. The Arbitrator shall not award punitive damages to
either party and the parties shall be deemed to have waived any right to such
damages.  The Arbitrator shall apply the Federal Rules of Evidence to the
hearing.  The proceeding shall take place in Honolulu, Hawaii in the English
language.  The fees of the Arbitrators and JAMS/ENDISPUTE shall be paid by the
losing party, which shall be designated by the Arbitrator.  If the Arbitrator is
unable to designate a losing party, it shall so state and the fees shall be
split equally between the parties.

          (c)  Award.  The Arbitrator is empowered to award any remedy allowed
by law, including money damages, prejudgment interest and attorneys' fees, and
to grant final, complete, interim, or interlocutory relief, including injunctive
relief but excluding punitive damages.

     11.5 Confidentiality.  The ADR proceeding, the existence of any dispute
submitted to ADR, and the award shall be confidential and the Panel shall issue
appropriate protective orders to safeguard each party's Confidential
Information.  Except as required by law or in connection with the enforcement of
an award hereunder, no party shall disclose (or instruct the Panel to disclose)
such Confidential Information without prior written consent of each other party.

     11.6  Judicial Enforcement.  The parties agree that judgment on any
arbitral award issued pursuant to this Article 11 shall be entered in the United
States District Court for the Northern District of California or, in the event
such court does not have subject matter jurisdiction over the dispute in
question, such judgment shall be entered in the Superior Court of the State of
California, in the County of San Mateo.

12.  Miscellaneous.

     12.1 Notices.  All notices required or permitted to be given under this
Agreement shall be in writing and shall be mailed by registered or certified
mail, postage prepaid, addressed to the signatory to whom such notice is
required or permitted to be given and transmitted by facsimile to the number
indicated below.  All notices shall be deemed to have been given when mailed, as
evidenced by the postmark at the point of mailing, or transmitted by facsimile.

     All notices to Sankyo shall be addressed as follows:

     Sankyo Company, Ltd.

[*] CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE sECURITIES ACT OF 1933, AS
AMENDED.

                                       13
<PAGE>

     2-58, Hiromachi 1-chome
     Shinagawa-ku
     Tokyo 140-8710
     JAPAN
     Attention:  Dr. Hiroshi Fukumi
     Fax: 81-3-5436-8569

     with a copy to:

     Sankyo Company, Ltd.
     2-58, Hiromachi 1-chome
     Shinagawa-ku
     Tokyo 140-8710
     JAPAN
     Attention:  Dr. Hidenori Shimotsu
     Fax:  81-3-5436-8561

     All notices to Telik shall be addressed as follows:

     Telik, Inc.
     750 Gateway Boulevard
     South San Francisco, California 94080
     U.S.A.
     Attention:  President
     Fax: (650) 244-9388

     with a copy to:

     Cooley Godward LLP
     Five Palo Alto Square
     3000 El Camino Real
     Palo Alto, California 94306
     U.S.A.
     Attention: Robert L. Jones, Esq.
     Fax:  (650) 857-0663

     Any Party may, by written notice to the other, designate a new addressee,
address or facsimile number to which notices to the Party giving the notice
shall thereafter be mailed or faxed.

     12.2 Force Majeure.  No Party shall be liable for any delay or failure of
performance to the extent such delay or failure is caused by circumstances
beyond its reasonable control and that by the exercise of due diligence it is
unable to prevent, provided that the Party claiming excuse uses its best efforts
to overcome the same.

     12.3 Entirety Of Agreement.  This Agreement embodies the entire, final and
complete agreement and understanding between the Parties and replaces and
supersedes all prior

[*] CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
    BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
    EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE sECURITIES ACT OF 1933, AS
    AMENDED.

                                       14
<PAGE>

discussions and agreements between them with respect to its subject matter
except as expressly stated herein. No modification or waiver of any terms or
conditions hereof shall be effective unless made in writing and signed by a duly
authorized officer of each Party.

     12.4  Non-Waiver.  The failure of a Party in any one or more instances to
insist upon strict performance of any of the terms and conditions of this
Agreement shall not constitute a waiver or relinquishment, to any extent, of the
right to assert or rely upon any such terms or conditions on any future
occasion.

     12.5  Disclaimer Of Agency.  Neither Party is, or will be deemed to be, the
legal representative or agent of the other, nor shall either Party have the
right or authority to assume, create, or incur any third party liability or
obligation of any kind, express or implied, against or in the name of or on
behalf of another except as expressly set forth in this Agreement.

     12.6  Severability.  If a court of competent jurisdiction declares any
provision of this Agreement invalid or unenforceable, or if any government or
other agency having jurisdiction over either Telik or Sankyo deems any provision
to be contrary to any laws, then that provision shall be severed and the
remainder of the Agreement shall continue in full force and effect.  To the
extent possible, the Parties shall revise such invalidated provision in a manner
that will render such provision valid without impairing the Parties' original
interest.

     12.7  Affiliates; Assignment.  Except as otherwise provided in this Section
12.7, neither Party may assign its rights or obligations under this Agreement
without the prior written consent of the other Party, such consent not to be
unreasonably withheld, except that a Party may assign its rights or obligations
to a third party in connection with the merger, consolidation, reorganization or
acquisition of stock or assets affecting substantially all of the assets or
actual voting control of the assigning Party.  This Agreement shall be binding
upon the successors and permitted assigns of the Parties. Any attempted
delegation or assignment not in accordance with this Section 12.7 shall be of no
force or effect.

     12.8  Headings.  The headings contained in this Agreement have been added
for convenience only and shall not be construed as limiting.

     12.9  Limitation Of Liability and Indemnification.  No Party shall be
liable to another for indirect, incidental, consequential or special damages,
including but not limited to lost profits, arising from or relating to any
breach of this Agreement, regardless of any notice of the possibility of such
damages.  In no event shall Telik be liable for any use by Sankyo of the
Provided Compounds.  Sankyo hereby agrees to indemnify, defend and hold Telik
harmless from damages for any loss, claim, injury or liability or whatsoever
kind or nature, which may arise from Sankyo's use, handling or storage of the
Provided Compounds.

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

     12.11 English Language.  This Agreement has been prepared in the English
language and shall be construed in the English language.

[*] CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
    BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
    EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS
    AMENDED.

                                       15
<PAGE>

     12.12 Further Assurances. Each party hereby agrees to execute, acknowledge
and deliver such further instruments, and to do all such other acts, as may be
necessary or appropriate in order to carry out the purposes and intent of this
Agreement.

     IN WITNESS WHEREOF, the parties have by duly authorized persons, executed
this Agreement, as of the date first above written.

<TABLE>
<CAPTION>
Sankyo Company, Ltd.                  Telik, Inc.
<S>  <C>                           <C>
By:    /s/ Tetsuo Hiraoka             By:    /s/ Reinaldo A. Gomez
       ----------------------------          ----------------------------------
Title: Director, Research Institute   Title: Vice President Corporate Alliances
       ----------------------------          ----------------------------------
Date:  March 23, 1999                 Date:  March 24, 1999
       ----------------------------          ----------------------------------
</TABLE>

[*] CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
    BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
    EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS
    AMENDED.

                                       16
<PAGE>

                                    APPENDIX

                          SELECTED TARGETS AND ASSAYS




[*] CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS
AMENDED.

                                       17
<PAGE>

                                    APPENDIX

                Targets, Assays and Criteria of Active Molecules
                                    5/13/99

[*]


[*] CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS
AMENDED.

                                       18
<PAGE>

September 30, 1999

Dr. Yoshiki Matsui
Vice Director, Research Planning Department
and
Dr. Hidenori Shimotsu
Research Planning Department
Sankyo Co., Ltd.
2-58, Hiromachi 1-chome
Shinagawa-ku, Tokyo 140
Japan


Dear Dr. Matsui and Dr. Shimotsu:

     Reference is made to that certain Agreement dated as of March 24, 1999
     between Sankyo Company, Ltd. and Telik, Inc. (the "Agreement"; capitalized
     terms used and not otherwise defined herein shall have the meanings
     ascribed to such terms in the Agreement).  Subject to your agreement
     herewith, as of the date indicated below, the notices provided to Sankyo
     stated in Article 12.1 of the Agreement shall be addressed as follows:

          Sankyo Company, Ltd.
          2-58, Hiromachi 1-chome
          Shinagawa-ku
          Tokyo 140
          JAPAN
          Attention: Dr. Hidenori Shimotsu
          Fax: 81-3-5436-8561

     with a copy to:

          Sankyo Company, Ltd.
          2-58, Hiromachi 1-chome
          Shinagawa-ku
          Tokyo 140
          JAPAN
          Attention: Dr. Yoshiki Matsui
          Fax: 81-3-5436-8561


Page 2
September 30, 1999

[*] CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS
AMENDED.

                                       19
<PAGE>

     If you are in agreement with the foregoing, please execute this letter
agreement where indicated below whereupon it will become an agreement between us
on the terms indicated above.

                                       Sincerely,

                                       TELIK, INC.

                                       By:     /s/ Reinaldo F. Gomez
                                               ----------------------------
                                       Name:   Reinaldo F. Gomez
                                               ----------------------------
                                       Title:  VP Corporate Alliance
                                               ----------------------------

Accepted and Agreed to
this ____ of October, 1999.

 SANKYO COMPANY, LTD.

 By:     /s/ Yukio Sughnura
        ----------------------------
 Name:   Yukio Sughnura, Ph.D.
        ----------------------------
 Title:  Senior Director
        ----------------------------
        Research Planning Department
        ----------------------------
        Sankyo Co., Ltd.
        ----------------------------


[*] CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS
AMENDED.

                                       20
<PAGE>

                                    APPENDIX

                Targets, Assays and Criteria of Active Molecules
                                Ammended 2/16/00

Selected Targets
----------------

[*]

Substitute Selected Targets
---------------------------

[*]



[*] CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE sECURITIES ACT OF 1933, AS
AMENDED.

                                       21