[XENOPORT LOGO] RIEFLIN EMPLOYMENT AGREEMENT

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Exhibit 10.18

[XENOPORT LOGO]

RIEFLIN EMPLOYMENT AGREEMENT

This Agreement is entered into as of June 18, 2004, by and between

XenoPort, Inc. (the "COMPANY"), and William J. Rieflin ("EXECUTIVE").

1. Duties and Scope of Employment.

(a) Effective Date. Executive will commence employment with the

Company on the "EFFECTIVE DATE," which shall be the later of (i) August 31, 2004

or (ii) one month following the closing of the acquisition of Tularik Inc. by

Amgen Inc. In the event that the closing of the acquisition of Tularik Inc. by

Amgen Inc. does not occur by September 30, 2004, this Agreement automatically

shall be deemed rescinded and terminated (with no obligations due by either

party) by both the Company and Executive, unless both the Company and Executive

provide written authorization to the contrary.

(b) Positions and Duties. As of the Effective Date, Executive will

serve as President of the Company. Executive will render such business and

professional services in the performance of his duties, consistent with

Executive's position within the Company, as will reasonably be assigned to him

by the Company's Board of Directors (the "BOARD"). These duties will initially

include responsibility for all aspects of the following operations of the

Company: legal (including intellectual property), corporate development,

business strategy, business development, human resources, facilities,

information technology, and environmental, health and safety. The Board may

modify Executive's job title and duties, in a manner consistent with Executive's

training and experience, as it deems necessary and appropriate in light of the

Company's needs and interests from time to time. The period of Executive's

employment under this Agreement is referred to herein as the "EMPLOYMENT TERM."

(c) Obligations. During the Employment Term, Executive will perform

his duties faithfully and to the best of his ability and will devote his full

business efforts and time to the Company. For the duration of the Employment

Term, Executive agrees not to actively engage in any other employment,

occupation or consulting activity for any direct or indirect remuneration

without the prior approval of the Board. Notwithstanding the foregoing, during

the Employment Term, Executive will be permitted to serve (i) as a consultant to

Amgen Inc. with respect to Tularik Inc. matters and (ii) as a member of up to

two boards of directors; provided, however, that such outside activities will be

permitted only to the extent that they do not interfere or conflict with

Executive's performance of his duties to the Company, as reasonably determined

by the Board.

2. At-Will Employment. The parties agree that Executive's employment with

the Company will be "at-will" employment and may be terminated at any time with

or without cause or notice. Executive understands and agrees that neither his

job performance nor promotions, commendations, bonuses or the like from the

Company give rise to or in any way serve as the basis for modification,

amendment, or extension, by implication or otherwise, of his employment with the

Company.

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3. Compensation.

(a) Base Salary. During the Employment Term, the Company will pay

Executive an annual salary of $275,000.00 as compensation for his services (the

"BASE SALARY"). The Base Salary will be paid periodically in accordance with the

Company's normal payroll practices and be subject to the usual, required

withholding. Executive's salary will be subject to review and adjustments will

be made based upon the Company's standard practices.

(b) Bonus. Executive will be entitled to participate in any bonus

plan adopted by the Company for its employees or executive officers on such

terms as the Board may determine in its discretion, including the existing

XenoPort, Inc. Bonus Plan. Executive's target bonus under the terms of such

Bonus Plan for 2004 equals twenty-five percent (25%) of his Base Salary.

(c) Restricted Stock Grant. Subject to approval of the Board,

Executive will be issued 200,000 shares of the Company's Common Stock (the

"RESTRICTED STOCK") at an issue price per share equal to the par value of $0.001

per share of such Common Stock, payable by Executive at the time of issuance,

pursuant to the terms of the Company's standard restricted stock purchase

agreement (the "PURCHASE AGREEMENT"). In the event Executive's services to the

Company terminate for any reason (i) on or prior to the six-month anniversary of

the Effective Date, the Company will have the right to repurchase one hundred

percent (100%) of the Restricted Stock at the per share par value price paid by

Executive, or (ii) after such six-month anniversary but on or prior to the

one-year anniversary of the Effective Date, the Company will have the right to

repurchase fifty percent (50%) of the Restricted Stock at the per share par

value price paid by Executive; provided, however, that if Executive's services

to the Company are (1) terminated by the Company without Cause (as defined

below) or (2) terminated by Executive for Good Reason (as defined below) or as a

result of Constructive Termination (as defined below), during either of the

periods described in clause (i) or (ii) above, the Company shall not have the

right to repurchase any of the Restricted Stock. The delivery of a stock

certificate representing any applicable vested portion of the Restricted Stock

following a termination of Executive's services to the Company will be subject

to Executive signing and not revoking a separation agreement and release of

claims in a form reasonably acceptable to the Company and Executive. No

certificate representing such vested shares will be delivered until the

separation agreement and release agreement becomes effective.

(d) Gross-Up Payment. In connection with the grant to Executive of

the Restricted Stock, Executive shall be entitled to receive an additional cash

payment (a "GROSS-UP PAYMENT") from the Company, or the Company shall pay such

amount on Executive's behalf to the applicable government agency, in the sole

discretion of the Company, in an aggregate amount sufficient to pay (i)

Executive's applicable federal and state personal income tax liability on the

initial value of the Restricted Stock (the "PRIMARY PAYMENT"), (ii) Executive's

applicable federal and state personal income tax liability on the Primary

Payment (the "SECONDARY PAYMENT") and (iii) Executive's applicable federal and

state personal income tax liability on the Secondary Payment; provided, however,

in no event shall the total Gross-Up Payment exceed $68,000. Executive shall

provide the Company with such documentation as it reasonably

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requests to confirm the appropriate amount of such Gross-Up Payment and to

process the payment thereof.

(e) Stock Options. Subject to approval of the Board, Executive will

be granted the following stock options, each of which will be, to the extent

possible under the $100,000 rule of Section 422(d) of the Internal Revenue Code

of 1986, as amended (the "CODE"), an "incentive stock option" (as defined in

Section 422 of the Code): (i) a stock option to purchase 300,000 shares of the

Company's Common Stock (as adjusted for stock splits, stock dividends and

similar events) (the "FIRST OPTION"), which will vest monthly as to 1/48th of

the shares subject to the First Option, so that the First Option will be fully

vested four (4) years from the Effective Date, subject to Executive's continued

service to the Company through the relevant vesting dates and (ii) a stock

option to purchase 400,000 shares of the Company's Common Stock (as adjusted for

stock splits, stock dividends and similar events) (the "SECOND OPTION"), which,

subject to the accelerated vesting provisions set forth herein, will cliff vest

in full on the four-year anniversary of the Effective Date, subject to

Executive's continued service to the Company through the relevant vesting dates;

provided, however, that (1) fifty percent (50%) of the shares subject to the

Second Option will accelerate and vest on the earlier to occur of the filing by

the Company of its first registration statement with the Securities and Exchange

Commission under the Securities Act of 1933, as amended, (the "REGISTRATION

STATEMENT FILING") or the closing of a Major Transaction (as defined below), and

(2) fifty percent (50%) of the shares subject to the Second Option will

accelerate and vest at the time the Company first achieves a market

capitalization of $500 million (as reasonably determined by the Board prior to

the date on which the Company's Common Stock is first traded on a national stock

exchange or quotation system, or if the Company's Common Stock is so traded,

then based on the closing sale price of the Company's Common Stock on such

exchange or system). The First Option and Second Option will have an exercise

price equal to the fair market value of the Company's Common Stock on the date

of grant as determined by the Board in its sole discretion and will be subject

to the terms, definitions and provisions of the Company's 1999 Stock Plan (the

"OPTION PLAN") and the related stock option agreements by and between Executive

and the Company (the "OPTION AGREEMENTS"), all of which documents are

incorporated herein by reference.

(f) Loan. The Company will permit Executive to early exercise the

First Option and Second Option pursuant to restricted stock purchase agreements

and to pay the applicable exercise price (as of the date hereof estimated to be

approximately $315,000, based on the current fair market value of the Company's

Common Stock) with a full recourse promissory note that is further secured by a

pledge of the Company's Common Stock owned by Executive (the "LOAN"). The Loan,

including principal and outstanding interest thereon, will be payable by

Executive at the earlier of (i) immediately upon Executive's termination of

services to the Company or (ii) immediately prior to the Registration Statement

Filing. The Loan will be reflected in appropriate promissory note and security

agreement documentation, all of which documents are incorporated herein by