**Exhibit 10.36**

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**FINAL**

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TRANSKARYOTIC THERAPIES,INC.

 

2002 STOCKINCENTIVE PLAN

 

1.             Purpose

 

The purpose of this 2002 Stock Incentive Plan (the“Plan”) of Transkaryotic Therapies, Inc., a Delaware****corporation (the “Company”),is to advance the interests of the Company’s stockholders by enhancing theCompany’s ability to attract, retain and motivate persons who make (or areexpected to make) important contributions to the Company by providing suchpersons with equity ownership opportunities and performance-based incentivesand thereby better aligning the interests of such persons with those of theCompany’s stockholders.  Except wherethe context otherwise requires, the term “Company” shall include any of theCompany’s present or future parent or subsidiary corporations as defined inSections 424(e) or (f) of the Internal Revenue Code of 1986, as amended,and any regulations promulgated thereunder (the “Code”) and any other businessventure (including, without limitation, joint venture or limited liability company)in which the Company has a controlling interest, as determined by the Board ofDirectors of the Company (the “Board”).

 

2.             Eligibility

 

All of the Company’s employees, officers, directors,consultants and advisors are eligible to be granted options or restricted stockawards (each, an “Award”) under the Plan. Each person who has been granted an Award under the Plan shall be deemeda “Participant”.

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# 3.             Administrationand Delegation

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## (a)           Administration byBoard of Directors.  The Plan willbe administered by the Board.  The Boardshall have authority to grant Awards and to adopt, amend and repeal suchadministrative rules, guidelines and practices relating to the Plan as it shalldeem advisable.  The Board may correctany defect, supply any omission or reconcile any inconsistency in the Plan orany Award in the manner and to the extent it shall deem expedient to carry thePlan into effect and it shall be the sole and final judge of suchexpediency.  All decisions by the Boardshall be made in the Board’s sole discretion and shall be final and binding onall persons having or claiming any interest in the Plan or in any Award.  No director or person acting pursuant to theauthority delegated by the Board shall be liable for any action ordetermination relating to or under the Plan made in good faith.  Subject to the provisions of the Plan, theBoard shall have complete authority, in its sole discretion, to make or toselect the manner of making any and all determinations required for theoperation of the Plan, and without limiting the generality of the foregoing,shall have the authority to:

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### (1)           grant Awards to eligible individualspursuant to the terms of the Plan;

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### (2)           determine whether and to what extent Awardsare to be granted hereunder;

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### (3)           determine the number of shares ofCommon Stock to be covered by each Award granted hereunder;

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(4)           determinethe terms and conditions, not inconsistent with the terms of the Plan, of anyAward (which need not be identical in every case), including, but not limitedto, the price of the restricted stock or the exercise price of the option andany restriction or limitation, or any vesting acceleration or forfeiture waiverregarding any Award and the shares of Common Stock relating thereto, based onsuch factors as the Board shall determine;

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### (5)           determinewhether and under what circumstances an Award may be settled, as provided inSection 5(f);

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### (6)           determinewhether and under what circumstances an Award may be exercised without apayment of cash as provided in Section 5(f); and

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### (7)           determinewhether, to what extent and under what circumstances Common Stock and otheramounts payable with respect to an Award under this Plan shall be deferredeither automatically or at the election of the Participant.

 

In making such determinations, the Board may take intoaccount the nature of the services rendered by the respective individuals,their present and potential contributions to the success of the Company, andsuch other factors as the Board in its discretion shall deem relevant.  Subject to the provisions of the Plan, theBoard shall also have complete authority, in its sole discretion, to interpretthe Plan, to prescribe, amend and rescind rules and regulations relating to it,to determine the terms and provisions of any Award issued under the Plan (andany agreements relating thereto), to resolve all disputes arising under thePlan, and to make all other determinations necessary or advisable for theadministration of the Plan.

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## (b)           Appointment of Committees.****Tothe extent permitted by applicable law, the Board may delegate any or all ofits powers under the Plan to one or more committees or subcommittees of theBoard (a “Committee”).  All referencesin the Plan to the “Board” shall mean the Board or a Committee of the Board orthe executive officers referred to in Section 3(c) to the extent that theBoard’s powers or authority under the Plan have been delegated to suchCommittee.

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## (c)           Delegation to ExecutiveOfficers.  To the extent permitted byapplicable law, the Board may delegate to one or more executive officers of theCompany the power to grant Awards to employees or officers of the Company orany of its present or future subsidiary corporations and to exercise such otherpowers under the Plan as the Board may determine, provided that the Board shallfix the terms of the Awards to be granted by such executive officers (includingthe exercise of such Awards, which may include a formula by which the exerciseprice will be determined) and the maximum number of shares subject to Awardsthat the executive officers may grant; provided, further, however, that noexecutive officer shall be

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authorized to grant Awards to any “executive officer” of the Company(as defined in Rule 3b-7 under the Securities Act of 1934, as amended (the“Exchange Act”)) or to any “officer” of the Company (as defined by Rule 16a-1under the Exchange Act).

 

# 4.             StockAvailable for Awards

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## (a)           Number of Shares. Subject toadjustment under Section 7, Awards may be made under the Plan for up to2,500,000 shares of common stock, 0.01 par value per share, of the Company (the“Common Stock”).  If any Award expiresor is terminated, surrendered or canceled without having been fully exercisedor is forfeited in whole or in part (including as the result of shares ofCommon Stock subject to such Award being repurchased by the Company at theoriginal issuance price pursuant to a contractual repurchase right) or results inany Common Stock not being issued, the unused Common Stock covered by suchAward shall again be available for the grant of Awards under the Plan, subject,however, in the case of Incentive Stock Options (as hereinafter defined), toany limitations under the Code.  Sharesissued under the Plan may consist in whole or in part of authorized butunissued shares or treasury shares.

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## (b)           Per-Participant Limit.  Subject to adjustment under Section 7,the maximum number of shares of Common Stock with respect to which Awards maybe granted to any Participant under the Plan shall be****500,000 per calendaryear.  The per-Participant limitdescribed in this Section 4(b) shall be construed and applied consistently withSection 162(m) of the Code (“Section 162(m)”).

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# 5.             StockOptions

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## (a)           General.  The Board may grant options to purchaseCommon Stock (each, an “Option”) and determine the number of shares of CommonStock to be covered by each Option, the exercise price of each Option and theconditions and limitations applicable to the exercise of each Option, includingconditions relating to applicable federal or state securities laws, as itconsiders necessary or advisable.  AnOption which is not intended to be an Incentive Stock Option (as hereinafterdefined) shall be designated a “Nonstatutory Stock Option”.

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## (b)           Incentive Stock Options.  An Option that the Board intends to be an“incentive stock option” as defined in Section 422 of the Code (an “IncentiveStock Option”) shall only be granted to employees of the Company and shall besubject to and shall be construed consistently with the requirements of Section422 of the Code.  The Company shall haveno liability to a Participant, or any other party, if an Option (or any partthereof) which is intended to be an Incentive Stock Option is not an IncentiveStock Option.

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## (c)           Exercise Price.  The Board shall establish the exercise priceat the time each Option is granted and specify it in the applicable optionagreement; provided, however, that the exercise price shall be not less than100% of the fair market value of the Common Stock, as determined by the Boardat the time the Option is granted.

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## (d)           Duration of Options.  Each Option shall be exercisable at suchtimes and subject to such terms and conditions as the Board may specify in theapplicable option agreement provided, however, that no Option will be grantedfor a term in excess of 10 years.

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## (e)           Exercise of Option.  Options may be exercised by delivery to theCompany of a written notice of exercise signed by the proper person or by anyother form of notice (including electronic notice) approved by the Boardtogether with payment in full as specified in Section 5(f) for the number ofshares for which the Option is exercised.

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## (f)            Payment Upon Exercise.  Common Stock purchased upon the exercise ofan Option granted under the Plan shall be paid for as follows:

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### (1)           incash or by check, payable to the order of the Company;

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### (2)           exceptas the Board may, in its sole discretion, otherwise provide in an optionagreement, by (i) delivery of an irrevocable and unconditional undertaking by acreditworthy broker to deliver promptly to the Company sufficient funds to paythe exercise price and any required tax withholding or (ii) delivery by theParticipant to the Company of a copy of irrevocable and unconditionalinstructions to a creditworthy broker to deliver promptly to the Company cashor a check sufficient to pay the exercise price and any required taxwithholding;

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### (3)           forso long as the Common Stock is registered under the Securities Exchange Act of1934 (the “Exchange Act”), by delivery of shares of Common Stock owned by theParticipant valued at their fair market value as determined by (or in a mannerapproved by) the Board in good faith (“Fair Market Value”), provided (i) suchmethod of payment is then permitted under applicable law and (ii) such CommonStock, if acquired directly from the Company was owned by the Participant atleast six months prior to such delivery;

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### (4)           tothe extent permitted by the Board and provided for in an option agreement orcertificate, in its sole discretion by (i) delivery of a promissory note of theParticipant to the Company on terms determined by the Board, or(ii) payment of such other lawful consideration as the Board maydetermine; or

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### (5)           byany combination of the above permitted forms of payment.

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## (g)           Substitute Options.  In connection with a merger or consolidationof an entity with the Company or the acquisition by the Company of property orstock of an entity, the Board may grant Options in substitution for any optionsor other stock or stock-based awards granted by such entity or an affiliatethereof.  Substitute Options may begranted on such terms as the Board deems appropriate in the circumstances,notwithstanding any limitations on Options contained in the other sections ofthis Section 5 or in Section 2.

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# 6.             RestrictedStock.

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## (a)           Grants.  The Board may grant Awards entitling recipientsto acquire shares of Common Stock, subject to the right of the Company torepurchase all or part of such shares at their issue price or other stated orformula price (or to require forfeiture of such shares if issued at no cost)from the recipient in the event that conditions specified by the Board in theapplicable Award are not satisfied prior to the end of the applicablerestriction period or periods established by the Board for such Award (each, a“Restricted Stock Award”).

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## (b)           Terms and Conditions.  The Board shall determine the terms andconditions of any such Restricted Stock Award, including the conditions forrepurchase (or forfeiture) and the issue price, if any.

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## (c)           Stock Certificates.  Any stock certificates issued in respect ofa Restricted Stock Award shall be registered in the name of the Participantand, unless otherwise determined by the Board, deposited by the Participant,together with a stock power endorsed in blank, with the Company (or itsdesignee).  At the expiration of the applicablerestriction periods, the Company (or such designee) shall deliver thecertificates no longer subject to such restrictions to the Participant or ifthe Participant has died, to the beneficiary designated, in a manner determinedby the Board, by a Participant to receive amounts due or exercise rights of theParticipant in the event of the Participant’s death (the “DesignatedBeneficiary”).  In the absence of aneffective designation by a Participant, Designated Beneficiary shall mean theParticipant’s estate.

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# 7.             Adjustmentsfor Changes in Common Stock and Certain Other Events

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## (a)           Changes in Capitalization.  In the event of any stock split, reversestock split, stock dividend, recapitalization, combination of shares,reclassification of shares, spin-off or other similar change in capitalizationor event, or any distribution to holders of Common Stock other than a normalcash dividend, (i) the number and class of securities available under thisPlan, (ii) the per-Participant limit set forth in Section 4(b), (iii) thenumber and class of securities and exercise price per share subject to eachoutstanding Option, and (iv) the repurchase price per share subject to eachoutstanding Restricted Stock Award shall be appropriately adjusted by theCompany (or substituted Awards may be made, if applicable) to the extent theBoard shall determine, in good faith, that such an adjustment (or substitution)is necessary and appropriate.  If thisSection 7(a) applies and Section 7(c) also applies to any event, Section 7(c)shall be applicable to such event, and this Section 7(a) shall not beapplicable.

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## (b)           Liquidation or Dissolution.  In the event of a proposed liquidation ordissolution of the Company, the Board shall upon written notice to theParticipants provide that all then unexercised Options will (i) becomeexercisable in full as of a specified time at least 10 business days prior tothe effective date of such liquidation or dissolution and (ii) terminateeffective upon such liquidation or dissolution, except to the extent exercisedbefore such effective date.  The Boardmay specify the effect of a liquidation or dissolution on any Restricted StockAward granted under the Plan at the time of the grant.

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## (c)           Reorganization Events

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### (1)           Definition.  A “Reorganization Event” shall mean:  (a) any merger or consolidation of theCompany with or into another entity as a result of which all of the CommonStock of the Company is converted into or exchanged for the right to receivecash, securities or other property or (b) any exchange of all of the CommonStock of the Company for cash, securities or other property pursuant to a shareexchange transaction.

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### (2)           Consequencesof a Reorganization Event on Options. Upon the occurrence of a Reorganization Event, or the execution by theCompany of any agreement with respect to a Reorganization Event, the Boardshall provide that all outstanding Options shall be assumed, or equivalentoptions shall be substituted, by the acquiring or succeeding corporation (or anaffiliate thereof).  For purposeshereof, an Option shall be considered to be assumed if, following consummationof the Reorganization Event, the Option confers the right to purchase, for eachshare of Common Stock subject to the Option immediately prior to theconsummation of the Reorganization Event, the consideration (whether cash,securities or other property) received as a result of the Reorganization Eventby holders of Common Stock for each share of Common Stock held immediatelyprior to the consummation of the Reorganization Event (and if holders wereoffered a choice of consideration, the type of consideration chosen by theholders of a majority of the outstanding shares of Common Stock); provided,however, that if the consideration received as a result of the ReorganizationEvent is not solely common stock of the acquiring or succeeding corporation (oran affiliate thereof), the Company may, with the consent of the acquiring orsucceeding corporation, provide for the consideration to be received upon theexercise of Options to consist solely of common stock of the acquiring orsucceeding corporation (or an affiliate thereof) equivalent in fair marketvalue to the per share consideration received by holders of outstanding sharesof Common Stock as a result of the Reorganization Event.

 

Notwithstanding the foregoing, if the acquiring orsucceeding corporation (or an affiliate thereof) does not agree to assume, orsubstitute for, such Options, then the Board shall, upon written notice to theParticipants, provide that all then unexercised Options will become exercisablein full as of a specified time prior to the Reorganization Event and willterminate immediately prior to the consummation of such Reorganization Event, exceptto the extent exercised by the Participants before the consummation of suchReorganization Event; provided, however, that in the event of a ReorganizationEvent under the terms of which holders of Common Stock will receive uponconsummation thereof a cash payment for each share of Common Stock surrenderedpursuant to such Reorganization Event (the “Acquisition Price”), then the Boardmay instead provide that all outstanding Options shall terminate uponconsummation of such Reorganization Event and that each Participant shallreceive, in exchange therefor, a cash payment equal to the amount (if any) bywhich (A) the Acquisition Price multiplied by the number of shares of CommonStock subject to such outstanding Options (whether or not then exercisable), exceeds(B) the aggregate exercise price of such Options. To the extent all or anyportion of an Option becomes exercisable solely as a result of the firstsentence of this paragraph, upon exercise of such Option the Participant shallreceive shares subject to a right of repurchase by the Company or its successorat the Option exercise price.

 

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Such repurchase right (1) shall lapse at the same rate as the Optionwould have become exercisable under its terms and (2) shall not apply to anyshares subject to the Option that were exercisable under its terms withoutregard to the first sentence of this paragraph.

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### (3)           Consequencesof a Reorganization Event on Restricted Stock Awards.  Upon the occurrence of a ReorganizationEvent, the repurchase and other rights of the Company under each outstandingRestricted Stock Award shall inure to the benefit of the Company’s successorand shall apply to the cash, securities or other property which the CommonStock was converted into or exchanged for pursuant to such Reorganization Eventin the same manner and to the same extent as they applied to the Common Stocksubject to such Restricted Stock Award.

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# 8.             GeneralProvisions Applicable to Awards

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## (a)           Transferability of Awards.  Except as the Board may otherwise determineor provide in an option agreement or certificate, Awards shall not be sold,assigned, transferred, pledged or otherwise encumbered by the person to whomthey are granted, either voluntarily or by operation of law, except by will orthe laws of descent and distribution, and, during the life of the Participant,shall be exercisable only by the Participant. References to a Participant, to the extent relevant in the context,shall include references to authorized transferees.

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## (b)           Documentation.  Each Award shall be evidenced in such form(written, electronic or otherwise) as the Board shall determine.  Each Award may contain terms and conditionsin addition to those set forth in the Plan.

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## (c)           Board Discretion.  Except as otherwise provided by the Plan,each Award may be made alone or in addition or in relation to any otherAward.  The terms of each Award need notbe identical, and the Board need not treat Participants uniformly.

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## (d)           Termination of Status.  The Board shall determine the effect on anAward of the disability, death, retirement, authorized leave of absence orother  change in the employment or otherstatus of a Participant and the extent to which, and the period during which,the Participant, the Participant’s legal representative, conservator, guardianor Designated Beneficiary may exercise rights under the Award.

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## (e)           Withholding.  Each Participant shall pay to the Company,or make provision satisfactory to the Board for payment of, any taxes requiredby law to be withheld in connection with Awards to such Participant no laterthan the date of the event creating the tax liability.  Except as the Board may otherwise provide inan Award, when the Common Stock is registered under the Exchange Act, Participantsmay satisfy such tax obligations in whole or in part by delivery of shares ofCommon Stock, including shares retained from the Award creating the taxobligation, valued at their Fair Market Value; provided, however, that thetotal tax withholding where stock is being used to satisfy such tax obligationscannot exceed the Company’s minimum statutory withholding obligations (based onminimum statutory withholding rates for federal and state tax purposes,including payroll taxes, that are applicable to such supplemental taxable

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income).  The Company may, tothe extent permitted by law, deduct any such tax obligations from any paymentof any kind otherwise due to a Participant.

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## (f)            Amendment of Award.  The Board may amend, modify or terminate anyoutstanding Award, including but not limited to, substituting therefor anotherAward of the same or a different type, changing the date of exercise orrealization, and converting an Incentive Stock Option to a Nonstatutory StockOption, provided that the Participant’s consent to such action shall berequired unless the Board determines that the action, taking into account anyrelated action, would not materially and adversely affect the Participant.

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## (g)           Conditions on Delivery of Stock.  The Company will not be obligated to deliverany shares of Common Stock pursuant to the Plan or to remove restrictions fromshares previously delivered under the Plan until (i) all conditions of theAward have been met or removed to the satisfaction of the Company, (ii) inthe opinion of the Company’s counsel, all other legal matters in connectionwith the issuance and delivery of such shares have been satisfied, includingany applicable securities laws and any applicable stock exchange or stockmarket rules and regulations, and (iii) the Participant has executed anddelivered to the Company such representations or agreements as the Company mayconsider appropriate to satisfy the requirements of any applicable laws, rulesor regulations.

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## (h)           Acceleration.  The Board may at any time provide that anyAward shall become immediately exercisable in full or in part, free of some orall restrictions or conditions, or otherwise realizable in full or in part, asthe case may be.

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# 9.             Miscellaneous

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## (a)           No Right To Employment or OtherStatus.  No person shall have anyclaim or right to be granted an Award, and the grant of an Award shall not beconstrued as giving a Participant the right to continued employment or anyother relationship with the Company. The Company expressly reserves the right at any time to dismiss orotherwise terminate its relationship with a Participant free from any liabilityor claim under the Plan, except as expressly provided in the applicable Award.

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## (b)           No Rights As Stockholder.  Subject to the provisions of the applicableAward, no Participant or Designated Beneficiary shall have any rights as astockholder with respect to any shares of Common Stock to be distributed withrespect to an Award until becoming the record holder of such shares.  Notwithstanding the foregoing, in the eventthe Company effects a split of the Common Stock by means of a stock dividendand the exercise price of and the number of shares subject to such Option areadjusted as of the date of the distribution of the dividend (rather than as ofthe record date for such dividend), then an optionee who exercises an Optionbetween the record date and the distribution date for such stock dividend shallbe entitled to receive, on the distribution date, the stock dividend withrespect to the shares of Common Stock acquired upon such Option exercise,notwithstanding the fact that such shares were not outstanding as of the closeof business on the record date for such stock dividend.

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## (c)           Effective Date and Term of Plan.  The Plan shall become effective on the dateon which it is adopted by the Board, but no Award granted to a Participant thatis intended to comply with Section 162(m) shall become exercisable, vested orrealizable, as applicable to such Award, unless and until the Plan has beenapproved by the Company’s stockholders to the extent stockholder approval isrequired by Section 162(m) in the manner required under Section 162(m)(including the vote required under Section 162(m)).  No Awards shall be granted under the Plan after the completion often years from the earlier of (i) the date on which the Plan was adopted by theBoard or (ii) the date the Plan was approved by the Company’s stockholders, butAwards previously granted may extend beyond that date.

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## (d)           Amendment of Plan.  The Board may amend, suspend or terminatethe Plan or any portion thereof at any time, provided that to the extentrequired by Section 162(m), no Award granted to a Participant that is intendedto comply with Section 162(m) after the date of such amendment shall becomeexercisable, realizable or vested, as applicable to such Award, unless anduntil such amendment shall have been approved by the Company’s stockholders ifrequired by Section 162(m) (including the vote required under Section 162(m)).

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## (e)           Governing Law.  The provisions of the Plan and all Awardsmade hereunder shall be governed by and interpreted in accordance with the lawsof the State of Delaware, without regard to any applicable conflicts of law.

 

Board Approved Plan onMarch 6, 2002

 

Stockholders ApprovedPlan on June 6, 2002

 

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AMENDMENT NO. 1

TO

TRANSKARYOTICTHERAPIES, INC.

2002 STOCKINCENTIVE PLAN

 

1.             The following subsection is hereby inserted immediatelyfollowing section 6(c) of the Transkaryotic Therapies, Inc. 2002 StockIncentive Plan (the “2002 Plan”):

 

“(d)         Vesting of Restricted Stock Awards.  Any Restricted Stock Award, to the extentsuch Award vests other than on the basis of the passage of time, will not vestin full until at least one year from the date of the Award unless such Awardvests in full as a result of a change in control of the Company or from thedeath or disability of the Participant. Any Restricted Stock Award, to theextent such Award vests on the basis of the passage of time, will not vest infull until at least three years from the date of the Award unless such Awardvests in full as a result of a change in control of the Company or from thedeath or disability of the Participant.”

 

2.             Section 8(d) of the Plan is hereby deleted in itsentirety and the following is inserted in lieu thereof:

 

“(d)         Termination of Status.  Upon the disability, death, retirement,authorized leave of absence or other change in the employment or other statusof a Participant in the Plan, the Participant, the Participant’s legalrepresentative, conservator, guardian or designated beneficiary may exerciserights under an Award for ninety (90) days following the date of such event.”

 

3.             Section 8(f) (“Amendment of Award”) of the Plan ishereby deleted in its entirety.

 

4.             Section9(d) of the Plan is hereby deleted in its entirety and the following isinserted in lieu thereof:

 

“(d)         Amendment of Plan.  The Board may amend, suspend or terminatethe Plan or any portion thereof at any time, provided that to the extentrequired by Section 162(m), no Award granted to a Participant that is intendedto comply with Section 162(m) after the date of such amendment shall becomeexercisable, realizable or vested, as applicable to such Award, unless anduntil such amendment shall have been approved by the Company’s stockholders ifrequired by Section 162(m) (including the vote required underSection 162(m)).  The Board may notamend, suspend or terminate the Plan or any portion thereof at any time withoutstockholder approval if such approval is required by law, or the rules of theSecurities and Exchange Commission, the Internal Revenue Service or (other than  Section 162(m)), or The Nasdaq NationalMarket.”

 

Amendment Approved byBoard on September 19, 2002

 

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