**Exhibit 10.31**

 

ConfidentialMaterials omitted and filed separately with the Securities and Exchange Commission. Asterisks denote omissions.

** **

** **

**LICENSE AGREEMENT**

** **

**between**

** **

**TRANSKARYOTICTHERAPIES, INC.**

** **

**and**

** **

**CELLGENESYS, INC.**

 

----

 

**LICENSE AGREEMENT**

 

This **License Agreement**(the“**Agreement**”), effective as of June7, 2002 (the “Effective Date”), is between **TRANSKARYOTIC THERAPIES, INC.,**a corporation organized and existing under thelaws of Delaware and having its principal place of business at 195 Albany Street,Cambridge, MA 02139 (“**TKT**”), and **CELLGENESYS, INC.,**acorporation organized and existing under the laws of Delaware and having itsprincipal place of business at 342 Lakeside Drive, Foster City, CA 94404 (“**CELL GENESYS**”).  TKT and CELL GENESYS are sometimes hereinafter referred to each asa “Party” and collectively as the “Parties.”

** **

**WITNESSETH:**

** **

**WHEREAS**,CELL GENESYS has certain Patent Rights (as hereinafter defined);

** **

**WHEREAS**,TKT desires to obtain a license under the CELL GENESYS Patent Rights upon theterms and conditions set forth herein, and CELL GENESYS desires to grant such alicense;

** **

**NOW,THEREFORE,** in consideration of the foregoing premises and themutual covenants herein contained, and intending to be legally bound, theParties hereby agree as follows:

** **

**ARTICLE  I**

** **

**DEFINITIONS**

 

Unless specifically set forth to the contrary herein,the following terms, whether used in the singular or plural, shall have therespective meanings set forth below:

** **

**1.1         **“**Affiliate**” shall mean, with respect to a particularParty, a person, corporation, partnership, or other entity that controls, iscontrolled by or is under common control with such Party.  For the purposes of the definition in thisSection 1.1, the word “control” (including, with correlative meaning, theterms “controlled by” or “under the common control with”) means the actualpower, either directly or indirectly through one or more intermediaries, todirect or cause the direction of the management and policies of such entity,whether by the ownership of at least fifty percent (50%) of the voting stock ofsuch entity, or by contract or otherwise.

** **

**1.2         **“**Designated Protein**” shall mean one of the[**], as described in or determined by the provisions set forth in the letter dated June 7, 2002 from Robert H. Tidwell ofCELL GENESYS to Michael J. Astrue of TKT (the “Side Letter”), and subject toSections 2.2 and 2.3 hereof.

** **

**1.3         **“[**]”.

** **

**1.4         **“**Licensed Product(s)**” shall mean [**]Licensed Products and [**] Licensed Products. “[**] Licensed Product” shall mean [**] of a Designated Protein, themaking, using, selling, offering for sale or import of which is covered by aclaim in the Patent Rights.  “[**]

 

1

----

 

Licensed Product”shall mean [**], the making, using, selling, offering for sale or import ofwhich is covered by a claim in the Patent Rights.  For clarity, the term “Licensed Product(s)” does not include acomposition that includes a protein that is covered by, or that was made by aprocess covered by, a claim in the Patent Rights, if that protein is not aDesignated Protein.

** **

**1.5         **“**Patent Rights**” shall mean: (a) all patentsand patent applications (including provisional and utility applications) ownedby CELL GENESYS, or licensed by CELL GENESYS with the right to sublicense, asof the Effective Date that claim [**], including, but not limited to: [**]; andalso any new patent or patent application (*i.e.,* not a continuing application) filedafter the Effective Date that is owned by CELL GENESYS and [**] (b) divisions,continuations, continuations-in-part (but solely as to claims that encompasssubject matter disclosed in the parent application), extensions, supplementaryprotection certificates, utility models, reexaminations, reissues and renewalsof the patents and patent applications in clause (a) above,; and (c) foreignequivalents of the patents and applications in clauses (a) and (b) above.

** **

**1.6         **“**Third Party**” shall mean a party other thanTKT, CELL GENESYS, or their respective Affiliates.

** **

**ARTICLE  II**

** **

**LICENSE GRANT**

** **

**2.1          License Grant.** Subject to the terms andconditions of this Agreement, CELL GENESYS grants to TKT (i) an [**] under thePatent Rights to [**], and (ii) a [**] under the Patent Rights to [**] solelyfor use to [**].

 

**2.2          Identification of Designated Proteins.** TKT shalldesignate in writing each additional protein that TKT desires to designate as aDesignated Protein pursuant to the Side Letter (up to the maximum number andwithin the timeframes set forth therein), but subject to the following.  Until such time as TKT’s rights to designateadditional Designated Proteins as provided in this Agreement have terminated,CELL GENESYS shall [**] of any protein.

** **

**2.3          Substitution of Designated Proteins.**NotwithstandingSection 1.2, Section 2.2 and the Side Letter,if, on the [**] of the Effective Date, CELL GENESYS has [**] then TKT shall have the right to designate an [**]: (i) a method or composition for, or including, theactivation of a gene that is [**], (ii) a composition or a gene activation method that does [**] and (iii) a method or composition for or including geneactivation which does [**].  Such additional[**] shall beidentified on or before [**].

 

** **

**ARTICLE  III**

** **

**CONFIDENTIALITY/PRESS RELEASES**

 

**3.1          Nondisclosure Obligation.** All proprietary orconfidential information disclosed by or on behalf of one Party (the“Disclosing Party”) to the other Party (the “Receiving Party”) 

 

2

----

 

hereunder inwriting and marked “Confidential” or the equivalent (the “ProprietaryInformation”) shall be maintained in confidence by the Receiving Party andshall not be disclosed to a Third Party or used for any purpose whatsoeverexcept as set forth herein without the prior written consent of the DisclosingParty.  All information disclosed byCELL GENESYS or TKT pursuant to the Binding Letter of Intent dated April 21,2002 (the “LOI”) shall be deemed Proprietary Information of CELL GENESYS orTKT, as the case may be, and shall be subject to the terms of this Article 3.  For purposes of clarity, it is the intent ofthe Parties that general financial terms may be disclosed but that the numberof Licensed Products and the nature and category of proteins which may bedesignated under this Agreement, as well as the nature of the milestones hereinshall be considered Proprietary Information of both Parties.  The identity of the Licensed Products andDesignated Proteins shall be TKT Proprietary Information.  However, the foregoing obligations shall notapply to particular Proprietary Information solely to the extent that thereceiving Party can demonstrate with written evidence that such information:

 

**(a)          **is known by the ReceivingParty at the time of its receipt, and not through a prior confidentialdisclosure by or on behalf of the Disclosing Party;

 

**(b)          **is properly in thepublic domain through no fault of the Receiving Party;

 

**(c)          **is subsequentlydisclosed to the receiving Party by a Third Party who may lawfully do so and isnot directly or indirectly under an obligation of confidentiality to theDisclosing Party; or

 

**(d)          **is developed by theReceiving Party independently of, and without reference to or use of,Proprietary Information received from the Disclosing Party.

 

**3.2          Authorized Disclosures.** A Party may disclose theProprietary Information of the other Party to the extent such disclosure:

 

**(a)          **is required to bedisclosed by any governmental or other regulatory agency in order to obtainpatents, to obtain approval to conduct clinical trials or to market a LicensedProduct; *provided, however*, that(i) prior written notice is promptly delivered to the disclosing Party in orderto provide an opportunity to challenge or limit the disclosure obligations,(ii) such disclosure may be only to the extent necessary to obtain such patentsor approval, or to comply with regulations as appropriate and (iii)confidential treatment shall be sought to the extent reasonably practicable;

 

**(b)          **is necessary to bedisclosed to employees, agents, consultants and/or other Third Parties forpurposes related to the development and commercialization of Licensed Products(or for such Third Parties to determine their interest in performing suchactivities) in accordance with this Agreement on the condition that such ThirdParties agree to be bound by confidentiality obligations at least asrestrictive as the terms herein; or

 

**(c)          **is required to bedisclosed by law or court order, *provided*that prior written notice is promptly delivered to the disclosing Party inorder to provide an opportunity to

 

3

----

 

challenge or limitthe disclosure obligations, and *provided*further that such disclosure may be only to the extent reasonably necessary tocomply with the applicable law or court order.

 

**3.3          Press Releases.** Neither Party shall issue apress release relating to this Agreement without the prior review and writtenconsent of the other Party.

 

**3.4          Confidential Treatment.** In the event that eitherParty is required to include this Agreement and any agreements or lettersreferred to herein in any report, statement or other document filed by suchParty with the United States Securities and Exchange Commission (the “SEC”),then the disclosing Party shall [**] to obtain, to the maximum extent permittedby law, confidential treatment from the SEC of any trade secrets and commercialor financial information of a privileged or confidential nature, includingwithout limitation all information relating to the number or identity of theDesignated Proteins under this Agreement and the specific financial terms andthe nature of the milestones herein, and shall notify the other Party as tosuch efforts and all related communications with the SEC.  Notwithstanding the foregoing, neither Partyshall submit a confidentiality request for this Agreement or the agreements orletters referred to herein without providing the other Party with anopportunity for prior review and comment on such confidentiality request.  The filing Party shall reasonably considerand attempt to accommodate any such comments by such other Party in submittingsuch confidentiality request.

 

**ARTICLE  IV**

 

**PAYMENTS**

 

**4.1          Upfront Fees.**In consideration for the licensegranted to TKT by CELL GENESYS under Section 2.1 and CELL GENESYS’s fulfillmentof its other obligations and undertakings under this Agreement, within [**] ofthe Effective Date, TKT shall make a cash payment to CELL GENESYS of ElevenMillion U.S. Dollars (US $11,000,000), less the credit provided for in Section4.2, and shall issue and transfer to CELL GENESYS three hundred sixty sixthousand nine hundred twenty eight (366,928) shares of TKT common stock (the“Shares”) pursuant to an executed Stock Purchase Agreement in the form attachedhereto as Exhibit A (the “Stock Purchase Agreement”).

 

**4.2          Cash Payment Credit.**The cash payment of ThreeMillion U.S. Dollars (US $3,000,000) paid by TKT pursuant to the LOI betweenthe Parties effective April 21, 2002 shall be credited towards the upfront cashfee of Eleven Million U.S. Dollars (US $11,000,000), thereby reducing thepayment required pursuant to Section 4.1 to Eight Million U.S. Dollars (US$8,000,000).

 

**4.3          Milestone Payments.** In further consideration forthe license granted to TKT by CELL GENESYS under Section 2.1 and CELL GENESYS’sfulfillment of its other obligations and undertakings under this Agreement, TKTshall make cash and stock payments to CELL GENESYS in the respective amountsset forth below upon attainment of the respective milestone events set forthbelow:

 

4

----

 
| **EVENT**       |   | **AMOUNT** |   |
|-----------------|--------|------------|--------|
| (a)  [**]. |   | [**].      |   |
|            |   |       |   |
| (b)  [**]. |   | [**].      |   |
|            |   |       |   |
| (c)  [**]. |   | [**].      |   |

 

**4.4          Milestone Conditions.** No milestone shall bepayable more than once by TKT. Further, milestones 4.3(b) and 4.3(c) areexclusive of each other and only one can be achieved.  For clarity, TKT shall pay the amount designated above upon theachievement of milestone 4.3(a) and upon the achievement of either of milestone4.3(b) or 4.3(c).  CELL GENESYS shallnotify TKT in writing upon the achievement of any of the milestone events setforth above and TKT shall have [**] to make the corresponding cash payment orstock grant, as the case may be.

 

**4.5          Late Payments.** For each payment or stocktransfer not received by CELL GENESYS when due pursuant to Section 4.4, TKTmust pay to CELL GENESYS a simple interest charge of [**] per annum, or suchlower amount as is required by law, on the cash value of such payment or stocktransfer to be calculated from the date such payment or stock transfer is dueuntil it is actually received by CELL GENESYS.

 

**ARTICLE  V**

 

**REPRESENTATIONS, WARRANTIES AND INDEMNIFICATION**

 

**5.1          CELL GENESYS Representations and Warranties.**CELL GENESYS hereby represents and warrants to TKT that:

 

**(a)          **it has the fullcorporate power and authority to enter into this Agreement, to perform itsobligations under this Agreement and to grant the license granted under Article2 hereof, and this Agreement has been duly executed and constitutes a legal,valid and binding obligation of it enforceable against it in accordance withits terms and conditions, except as such enforceability may be limited byapplicable bankruptcy, insolvency, moratorium, reorganization or similar laws,from time to time in effect, affecting creditor’s rights generally or byprinciples of equity;

 

**(b)          **as of the EffectiveDate, there are no claims, oppositions, litigations, interferences, judgmentsor settlements against or owed by CELL GENESYS related to the Patent Rightsthat would materially affect the license granted hereunder, and there are nopending, and CELL GENESYS is not aware of any threatened, claims, oppositions,litigations, or

 

5

----

 

interferencesrelating to the Patent Rights, other than those claims of record as of theEffective Date [**];

 

**(c)          **(i) CELL GENESYS isnot aware that any of the data and information made available to TKT for thediligence conducted by TKT pursuant to the LOI are untrue or inaccurate to any material degree, and (ii) CELLGENESYS has made available to TKT all Materials (as defined in Section 1(a) ofthe LOI) in CELL GENESYS’s or any of its agents’ control or possession;

 

**(d)          **to CELL GENESYS’knowledge, it does not have any license rights granted to it by Third Partyunder any patent that claims the activation of genes to produce specificdesired proteins, which license rights cannot be sublicensed to TKT for thepurposes of the license rights granted under Section 2.1; and

 

**(e)          **the execution andperformance by it of its obligations hereunder does not and will not constitutea material breach of, or materially conflict with, any agreement or arrangementby which it is bound, and that it will not enter into any agreement whichmaterially conflicts with the terms hereof.

 

**5.2          TKT Representations and Warranties.** TKT hereby representsand warrants to CELL GENESYS that:

 

**(a)          **it has the fullcorporate power and authority to enter into this Agreement and to perform itsobligations under this Agreement, and this Agreement has been duly executed andconstitutes a valid, binding and enforceable agreement in accordance with itsterms and conditions, except as such enforceability may be limited byapplicable bankruptcy, insolvency, moratorium, reorganization or similar laws,from time to time in effect, affecting creditor’s rights generally or byprinciples of equity; and

 

**(b)          **the execution andperformance by it of its obligations hereunder does not and will not constitutea material breach of, or materially conflict with, any agreement or arrangementby which it is bound, and that it will not enter into any agreement whichmaterially conflicts with the terms hereof.

 

**5.3          CELL GENESYS Indemnification.** CELL GENESYShereby agrees to defend, hold harmless and indemnify TKT, its Affiliates,agents, directors, officers and employees from and against any and all ThirdParty suits, claims, actions, demands, liabilities, costs, damages, fees,expenses and/or losses, including without limitation reasonable legal expensesand attorneys’ fees (collectively “Third Party Claims”) resulting from amaterial breach by CELL GENESYS of any of the provisions of this Agreement,including without limitation, the representations and warranties made inSection 5.1 by CELL GENESYS; except to the extent such Third Party Claimsresult from the negligence or intentional misconduct of, or breach hereof by,TKT.

 

**5.4          TKT Indemnification.** TKT hereby agrees todefend, hold harmless and indemnify CELL GENESYS, its Affiliates, agents,directors, officers and employees from and

 

6

----

 

against any andall Third Party Claims (except to the extent such Third Party Claims resultfrom the negligence or intentional misconduct of, or breach hereof by, CELLGENESYS), including any product liability claims, resulting:

 

**(a)          **from a materialbreach by TKT of any of the provisions of this Agreement; 

 

or

 

**(b)          **directly orindirectly from the manufacture, use, handling, storage, sale or otherdisposition of Licensed Products by TKT, or its Affiliates, agents orsublicensees.

 

**5.5          Indemnification Procedure.** The Party seekingindemnification under this Section 5 (the “Indemnified Party”) shall (i) giveprompt written notice to the other Party (the “Indemnifying Party”) of anyThird Party Claim for which indemnification is sought, (ii) permit theIndemnifying Party to assume full responsibility to investigate, prepare for,defend against and/or compromise or settle (subject to the provisions set forthbelow) the Third Party Claim and (iii) if the Indemnifying Party assumesresponsibility under clause (ii), reasonably assist the Indemnifying Party, atthe Indemnifying Party’s reasonable expense, in the investigation of,preparation for and defense of such Third Party Claim.  If the Indemnifying Party assumes control ofthe defense of a Third Party Claim, the Indemnifying Party shall not be liablefor any litigation costs or expenses incurred by the Indemnified Party.  If the Indemnifying Party does not assumecontrol of the defense of the Third Party Claim, the Indemnified Party shallcontrol such defense. The Indemnifying Party shall not compromise or settlesuch Third Party Claim without the Indemnified Party’s prior written consent ifthe compromise or settlement does not include a complete and unconditionalrelease of the Indemnified Party from all liability with respect thereto or ifthe compromise or settlement imposes any liability or obligation on theIndemnified Party.  The IndemnifiedParty shall not agree to any settlement of such action, suit, proceeding orclaim without the prior written consent of the Indemnifying Party.  The Indemnified Party shall have the rightto participate, at its own expense and with counsel of its choice, in thedefense of any claim or suit the defense of which has been assumed by theIndemnifying Party.

 

**5.6          LIMITATION OF LIABILITY.** EXCEPT FOR OBLIGATIONSUNDER SECTIONS 5.3 AND 5.4 OR IN CASE OF BREACH OF SECTION 3.1, IN NO EVENTSHALL EITHER PARTY, ITS DIRECTORS, OFFICERS, EMPLOYEES, AGENTS OR AFFILIATES BELIABLE TO THE OTHER PARTY FOR ANY INDIRECT, INCIDENTAL, SPECIAL, EXEMPLARY ORCONSEQUENTIAL DAMAGES, WHETHER BASED UPON A CLAIM OR ACTION OR CONTRACT,WARRANTY, NEGLIGENCE, STRICT LIABILITY OR OTHER TORT, OR OTHERWISE, ARISING OUTOF THIS AGREEMENT.

 

**5.7          Limited Warranty.** Except for the warranties providedby CELL GENESYS in Section 5.1 AND TKT IN SECTION 5.2, EACH PARTY disclaims allother warranties, express or implied, and specifically, without limitation, anywarranty of merchantability, fitness for a particular purpose or any warrantythat exercise by TKT of its rights under the Patent Rights will not infringeany intellectual property rights of third parties.

 

7

----

 

**ARTICLE  VI**

** **

**INTELLECTUAL PROPERTY PROVISIONS**

 

**6.1         **Filing, Prosecutionand Maintenance of Patents

 

**(a)          **Subject to Section6.1(b) below, CELL GENESYS agrees to file, prosecute and maintain all PatentRights [**] and shall provide TKT with copies of all documentation andcorrespondence related to the Patent Rights. To the extent that such documents pertain to Licensed Products, CELLGENESYS shall give TKT an opportunity to comment on any official communicationrelated to the Patent Rights before filing, shall [**], and shall consult withTKT thereon.  CELL GENESYS shall complywith any applicable duty to disclose information relevant to the Patent Rightsas required by the United States Patent and Trademark Office during theprosecution of any of the Patent Rights. CELL GENESYS shall [**] related to thescope of appropriate disclosure.

 

**(b)          **In the event thatCELL GENESYS elects not to file, prosecute or maintain any patent or patentapplication involving a particular patent or application in the Patent Rights,then CELL GENESYS shall give TKT at least [**] notice thereof and TKT shallhave the right to elect to undertake such prosecution and maintenance.  In such case, CELL GENESYS shall, [**],either (i) assign such patent or application (including any patent orapplication to which such patent or application claims priority) to TKT, or(ii) allow TKT to prosecute and maintain such patent in CELL GENESYS’s name,and grant TKT an [**]. TKT shall, [**], file, prosecute and maintain such patentor application (including any priority patent or patent application) in the PatentRights. CELL GENESYS shall execute such documents and perform such acts as maybe reasonably necessary to effect an assignment or transfer of power ofattorney to such Patent Rights to allow TKT to continue in a timely manner suchfiling, prosecution or maintenance. Upon completion of such assignment or transfer of power of attorney, TKTshall be deemed automatically to have granted CELL GENESYS a [**] license undersuch assigned Patent Rights [**]. Further, TKT agrees that it shall, upon CELL GENESYS’s request,negotiate in good faith with any Third Party to grant a license [**] under suchPatent Right to the extent needed for such Third Party to practice licenserights granted to it by CELL GENESYS under the Patent Rights prior to CELLGENESYS’s election not to file, prosecute or maintain such Patent Right, *providedthat*(a) such license rights do not include any right to make, havemade, use, sell, offer for sale or import any Licensed Products, and (b) suchThird Party is not, as of the date such election is made by CELL GENESYS not tofile, prosecute or maintain such Patent Right, [**].  CELL GENESYS shall give notice to TKT as soon as practicable inadvance of the grant, lapse, revocation, surrender, invalidation or abandonmentof any CELL GENESYS Patent Right being prosecuted by CELL GENESYS.

 

**6.2         **Opposition,Reexamination and Reissue.

 

**(a)          **CELL GENESYS shallnotify TKT, within [**] of learning of, and in any case, prior to publicdisclosure of, any request for, or filing or declaration of, any interference,opposition, reexamination, or the foreign equivalent of any of the foregoinginvolving the Patent Rights.

 

8

----

 

**(b)          **CELL GENESYS shallnot initiate any reexamination, interference or reissue proceeding involvingPatent Rights [**].

 

**(c)          **In connection withany interference, opposition, reissue, or reexamination proceeding (or theforeign equivalent of any of the foregoing) involving the Patent Rights, CELLGENESYS agrees to give TKT an opportunity to provide comments on any officialcommunication related to such interference, opposition, reissue, orreexamination proceeding (or the foreign equivalent of any of the foregoing)before filing, shall consider TKT’s comments in good faith, and shall consultwith TKT thereon.  Additionally, CELLGENESYS shall [**], and [**], including to the extent permissible by law andcontracts, the [**].  Notwithstandingthe foregoing, CELL GENESYS shall not be required to make any disclosure of anycommunication or other information that would destroy either theattorney/client privilege or attorney work product privilege protecting suchcommunication or other information, provided that if such communication orother information is material to TKT’s interests under this Agreement, CELLGENESYS shall, in good faith, use [**] to facilitate disclosure withoutdestroying any such privilege.

 

**6.3          Enforcement and Defense**.

 

**(a)          **Each Party shallgive the other Party notice of any unauthorized making, using, selling,offering for sale or importing of a Licensed Product that may come to suchParty’s attention (a “Field Infringement”). Each Party shall have the right to bring suit against such allegedinfringer in a Field Infringement, [**], and either Party may [**]; provided,however, that in the event that TKT brings a suit against an alleged infringeras the result of a possible Field Infringement, but in its sole reasonablediscretion believes that CELL GENESYS is or may be a necessary or indispensableparty under the applicable law, CELL GENESYS agrees to become a party in suchaction, and shall execute all documents and take all steps reasonably necessaryto enable TKT to initiate, prosecute and/or maintain such action, or for TKT todefend any declaratory judgment action brought by the alleged infringer.  Each Party shall be entitled in any suchaction [**] to assert its own claims for damages and to defend it interests inthe Patent Rights.  For any infringementof the Patent Rights other than a Field Infringement, CELL GENESYS shall havethe sole and exclusive right to bring an action against the infringer.

 

**(b)          **Each Party shall[**] pursuant to an action brought under subclause (a) above.

 

**(c)          **Each Party shallnotify the other of any certification regarding any Patent Rights which it hasreceived pursuant to 21 U.S.C. §§355(b)(2)(A)(iv) or (j)(2)(A)(vii)(IV) or itssuccessor provisions or the foreign equivalent thereof and shall provide theother with a copy of such certification within five (5) days of receipt.  CELL GENESYS’s and TKT’s rights with respectto the initiation and prosecution of any legal action (or the defense of anysuch legal action) as a result of such certification or any recovery obtainedas a result of such legal action shall be as defined above; provided, however,that if either Party shall exercise its first right to initiate and prosecuteany action or to control the defense of any such action, such Party shallnotify the other Party of such decision within ten (10) days of receipt of thecertification.

 

9

----

 

**(d)          **If any LicensedProduct becomes the subject of a Third Party claim, or there is the potentialfor a claim of patent infringement related to TKT’s development, use, sale,offer for sale or import of Licensed Products, TKT shall defend against suchclaim [**].  CELL GENESYS and TKT shallfully cooperate and provide assistance to each other, [**], with respect to anyproceeding related to gene activation patents owned or licensed by a Third Partyand asserted, or threatened to be asserted, by such Third Party, includingwithout limitation, [**].

 

**6.4          Third Party License; Settlement.** Except asotherwise provided herein, CELL GENESYS shall [**] that [**] under the PatentRights [**].

 

**ARTICLE  VII**

** **

**TERM AND TERMINATION**

 

**7.1          Term and Expiration.** This Agreement shall beeffective as of the Effective Date and, unless terminated earlier pursuant tothe provisions of Section 7.2  below,shall continue until the expiration of the last-to-expire Patent Right.

 

**7.2          Termination by Either Party for Cause.** ThisAgreement may be terminated by written notice by either Party at any timeduring the term of this Agreement if the other Party is in breach of a materialobligation hereunder and has not cured such breach within [**] after noticerequesting cure of the breach.  If TKTterminates this Agreement pursuant to this Section 7.2, then:  (a) the license granted pursuant to Section2.1 shall [**)], and provided that [**], and (b) in addition, TKT shall have(i) [**] under the Patent Rights to [**] and (ii) a [**] under the PatentRights to [**], *but excluding* from the foregoing rights any [**] under thePatent Rights that have been [**] prior to the date of breach.

 

**7.3          Survivals.** Termination or expiration of thisAgreement shall not relieve either Party of any obligation of such Party accruedprior to such termination or expiration. Any termination or expiration of this Agreement shall be withoutprejudice to the rights of either Party against the other accrued under thisAgreement prior to termination or expiration hereof.  The provisions of Articles 1, 3, 5, and 7 shall survive thetermination or expiration of this Agreement. Notwithstanding the termination ofthis Agreement pursuant to this Article VII, any sublicenses of Patent Rightsgranted by TKT hereunder prior to such termination shall survive suchtermination.  In such event, CELLGENESYS shall have the right to receive directly from the sublicensee anypayments or other consideration otherwise payable to TKT as the sublicensorunder such sublicense, and to otherwise exercise all of the rights of TKT asthe sublicensor under such sublicense; provided however that CELL GENESYS shallnot assume, and shall not be responsible for, any representations, warranties,promises or obligations of TKT to any sublicensees other than the licensesunder such sublicenses.

 

10

----

 

**ARTICLE  VIII**

 

**MISCELLANEOUS**

 

**8.1          Force Majeure.** Neither Party shall be heldliable or responsible to the other Party nor be deemed to have defaulted underor breached this Agreement for failure or delay in fulfilling or performing anyterm of this Agreement when such failure or delay is caused by or results fromcauses beyond the reasonable control of the affected Party including, but not limitedto, earthquakes, fire, floods, embargoes, war, acts of war (whether war bedeclared or not), insurrections, riots, civil commotions, strikes, lockouts orother labor disturbances, acts of God or acts, omissions or delays in acting byany governmental authority or the other Party. The affected Party shall notify the other Party of such force majeurecircumstances as soon as reasonably practical and shall make reasonable,diligent efforts to remove the condition constituting force majeure or to avoidits effects so as to resume performance as soon as practicable.

 

**8.2          Sublicenses.** All sublicenses granted by TKTunder the Patent Rights to Third Parties shall be on such terms as areconsistent with the provisions of this Agreement and shall be subject to therights of CELL GENESYS under this Agreement.

 

**8.3          Assignment.** Except as otherwise expresslyprovided below, this Agreement may not be assigned or otherwise transferred,nor may any right or obligation hereunder be assigned or transferred, by eitherParty without the prior written consent of the other Party; except that eitherParty may, without the prior written consent of the other Party, assign thisAgreement and such Party’s rights and obligations hereunder to its successor ininterest in connection with the transfer or sale of all or substantially all ofsuch Party’s assets or the business to which this Agreement relates, or in theevent of its merger, acquisition, consolidation, change in control or similartransaction.  Any permitted assigneeshall assume all obligations of its assignor under this Agreement except asotherwise provided herein.

 

**8.4          Severability.** If any provision hereof should beheld invalid, illegal or unenforceable in any respect, then, to the fullestextent permitted by law, (a) all other provisions hereof shall remain in fullforce and effect and shall be liberally construed in order to carry out theintentions of the Parties as nearly as may be possible and (b) the Partiesshall use their best efforts to replace the invalid, illegal or unenforceableprovision(s) with valid, legal and enforceable provision(s) which, insofar aspractical, implement the purposes of such provision(s) in this Agreement.

 

**8.5          Notices.** All notices or other communicationswhich are required or permitted hereunder, including any notices requiredpursuant to Section 2.2 hereof, shall be in writing and addressed as follows:

 

11

----

 
| if to CELL  GENESYS, to: | Cell Genesys,  Inc.                    |
|--------------------------|----------------------------------------|
|                     | 342 Lakeside  Drive                    |
|                     | Foster City, CA 94404                  |
|                     |                                   |
| Attention:               | Robert Tidwell                         |
|                     | Vice President,  Corporate Development |
|                     |                                   |
| with a copy to:          | Cooley Godward  LLP                    |
|                     | 3000 El Camino  Real                   |
|                     | Palo Alto, CA  94306-2155              |
|                     |                                   |
| Attention:               | Barclay J. Kamb,  Esq.                 |
|                     |                                   |
| if to TKT, to:           | Transkaryotic  Therapies, Inc.         |
|                     | 195 Albany  Street                     |
|                     | Cambridge,  MA  02139             |
|                     |                                   |
| Attention:               | Michael J.  Astrue                     |
|                     | Senior Vice  President, Administration |
|                     |                                   |
| with a copy to:          | Kerry A. Flynn                         |
|                     | Senior Director,  Business Development |

 

or to such other address as the Party to whom noticeis to be given may have furnished to the other Party in writing in accordanceherewith.  Any such communication shallbe deemed to have been given when delivered if personally delivered or sent byfacsimile (provided that the Party providing such notice promptly confirmsreceipt of such transmission with the other Party by telephone), on thebusiness day after dispatch if sent by a nationally-recognized overnightcourier and on the third business day following the date of mailing if sent bymail, postage prepaid, return receipt requested.

 

**8.6          Applicable Law.** This Agreement shall be governedby and construed in accordance with the laws of the State of Delaware, withoutreference to any rules regarding conflict of laws.  The Parties hereby consent to the jurisdiction of the state andfederal courts of the State of Delaware and agree that any disputes relatedhereto shall be adjudicated therein.

 

**8.7          Entire Agreement.** This Agreement, together withthe Side Letter and the Stock Purchase Agreement, contains the entire understandingof the Parties with respect to the subject matter hereof and supercedes allprior agreements with respect to the subject matter hereof, including withoutlimitation the LOI.  All express orimplied agreements and understandings, either oral or written, heretofore madeare expressly merged in and made a part of this Agreement.  Except as expressly set forth in thisAgreement, this Agreement may be amended, or any term hereof modified, only bya written instrument duly executed by both Parties.

 

**8.8          Headings.** The captions to the several Articlesand Sections hereof are not a part of this Agreement, but are merely guides orlabels to assist in locating and reading the several Articles and Sectionshereof.

 

12

----

 

**8.9          Independent Contractors.** It is expressly agreedthat CELL GENESYS and TKT shall be independent contractors and that therelationship between the two Parties shall not constitute a partnership, jointventure or agency.  Neither CELL GENESYSnor TKT shall have the authority to make any statements, representations orcommitments of any kind, or to take any action, which shall be binding on theother, without the prior written consent of the other Party.

 

**8.10        Waiver.**The waiver by either Party hereto of any right hereunder or the failure toperform or of a breach by the other Party shall not be deemed a waiver of anyother right hereunder or of any other breach or failure by said other Partywhether of a similar nature or otherwise.

 

**8.11        Counterparts.**This Agreement may be executed in two (2) or more counterparts, each of whichshall be deemed an original, but all of which together shall constitute one andthe same instrument.

 

**8.12        Waiverof Rule of Construction.** Each Party has had theopportunity to consult with counsel in connection with the review, drafting andnegotiation of this Agreement. Accordingly, the rule of construction that any ambiguity in thisAgreement shall be construed against the drafting Party shall not apply.

 

**8.13        Section365(n) of the Bankruptcy Code.** All licenses grantedunder this Agreement are, and shall otherwise be, deemed to be, for purposes ofSection 365(n) of the Bankruptcy Code, licenses of rights to “intellectualproperty” as defined under Section 101(35A) of the Bankruptcy Code.  The Parties shall retain and may fullyexercise all of their respective rights and elections under the BankruptcyCode.

 

**8.14        ThirdParty Beneficiaries.** Except as otherwise expresslyprovided in this Agreement, nothing herein expressed or implied is intended orshall be construed to confer upon or to give to any Third Party any rights orremedies by reason of this Agreement. Except as otherwise expressly provided in this Agreement, there are nointended Third Party beneficiaries under or by reason of this Agreement.

 

13

----

 

**INWITNESS WHEREOF**, the Parties have executed this LicenseAgreement as of the date first set forth above.

 
| **TRANSKARYOTIC THERAPIES, INC.** | **CELL GENESYS, INC.**                                       |
|-----------------------------------|--------------------------------------------------------------|
|                              |                                                         |
|                              |                                                         |
| By:                               | /s/Michael J.  Astrue                                        |   | By: |   |   |
|                              |                                                         |   |   |   |   |
| Name:                             | Michael J.  Astrue                                           | Name: |
| Title:                            | Senior Vice  President  Administration & General Counsel | Title: |
|                                   |                                                              |  |  |  |  |  |  |

 

14

----

 

**EXHIBITA**

 

**FORM OFSTOCK PURCHASE AGREEMENT**

 

**STOCKPURCHASE AGREEMENT**

 

**THISAGREEMENT** (“**Agreement**”)is made and entered into as of June 7, 2002 (the “**Effective Date**”), by and among Transkaryotic Therapies, Inc.,a Delaware corporation (the “***Company***”), and Cell Genesys, Inc., a Delawarecorporation (“***CELLGENESYS***”).

 

**A.**            Concurrently with the execution ofthis Agreement, the Company is entering into an Exclusive License Agreementwith CELL GENESYS, (the “*License Agreement*”), pursuant to whichCELL GENESYS is licensing the rights to certain technology to the Company; and

 

**B.**            In partial consideration for theexecution and delivery of the License Agreement by CELL GENESYS, the Companyhas agreed to issue to CELL GENESYS certain shares of the Company’s commonstock in accordance with the terms and conditions of this Agreement.

 

**AGREEMENT**

 

In consideration of the mutual covenants contained inthis Agreement and for other good and valuable consideration, the receipt ofwhich is hereby acknowledged, the Company and CELL GENESYS hereby agree asfollows:

 

**SECTION 1** Authorization of Sale of Shares.

 

**1.1          Authorization**.Subject to the terms and conditions of this Agreement, the Company has orbefore the Closings (as defined below) will have authorized the sale andissuance of up to the following number of shares of the Company’s Common Stock,par value $0.01 per share (the “Shares”):

 

**(a)          **Three-Hundred SixtySix Thousand Nine Hundred Twenty Eight (366,928) Shares (the “*Up Front Shares*”), subject to adjustmentpursuant to Section 1.2;

 

**(b)          **that number ofShares equal to [**] divided by the average closing price of the Company’sShares as reported on the Nasdaq National Market for the ten (10) consecutivetrading days ending two days prior to the date of the Second Tranche Closing,as hereinafter defined (the “*First MilestoneShares*”), which shares shall only be issued if the milestone inSection 4.3(a) of the License Agreement**isachieved; and

 

**(c)          **that number ofShares equal to [**], divided by the average closing price of the Company’sShares as reported on the Nasdaq National Market for the ten (10)

 

i

----

 

consecutive trading days ending two days prior to thedate of the Third Tranche Closing, as hereinafter defined****(the “*SecondMilestone Shares*”), which shares shall only be issued if themilestone in Section 4.3(b) of the License Agreement******is achieved.

 

If after the date hereof (i) the outstanding shares ofthe Company’s Common Stock shall be subdivided or split into a greater numberof shares or a dividend in Common Stock shall be paid in respect of such CommonStock, (ii) the outstanding shares of Common Stock are combined, (iii) theCompany shall pay a dividend in securities of the Company (other than CommonStock) or of other property (including cash) on the Common Stock, or (iv) thereshall occur any merger, consolidation, capital reorganization orreclassification in which the Common Stock is converted or exchanged forsecurities, cash or other property, all share quantities in this Agreement, aswell as the class or series of stock constituting the Common Stock for purposesof this Agreement, shall be appropriately adjusted to reflect such stocksplits, stock dividend, combination, other dividend, merger, consolidation,capital reorganization or reclassification. After any event referenced in clauses (i) through (iv) is consummated,if applicable, all references herein to the Company’s Common Stock shall bedeemed to refer to the capital stock or property (including cash) into or forwhich the Common Stock was converted or exchanged, with the necessary changesin detail.

 

**1.2          Adjustment of Up Front Shares**.The number of Up Front Shares shall be adjusted as follows:

 

**(a)          **if the product ofthe average closing price of the Company’s Shares as reported on the NasdaqNational Market for the ten (10) trading days ending two days prior to theeffective date of the Registration Statement (as hereinafter defined) withrespect to the Up Front Shares multiplied by 366,928 is less than FifteenMillion Dollars ($15,000,000), then the number of Up Front Shares shall beincreased by the number of Shares equal to (x) the difference between$15,000,000 and such product divided by (y) such average closing price; and theCompany shall issue to CELL GENESYS such additional Up Front Shares promptlyfollowing the end of such ten (10) day period for a price per share equal tothe par value of each such share, which price shall be deemed paid in partialconsideration for the execution and delivery by CELL GENESYS of the LicenseAgreement; provided further that the Company shall promptly cause any suchadditional shares to be registered, through supplement or amendment, on theRegistration Statement with respect to the Up Front Shares; and

 

**(b)          **if the product ofthe average closing price of the Company’s Shares as reported on the NasdaqNational Market for the ten (10) trading days ending two days prior to theeffective date of the Registration Statement (as hereinafter defined) withrespect to the Up Front Shares multiplied by 366,928 is greater than FifteenMillion Dollars ($15,000,000), then the number of Up Front Shares shall bedecreased by a number of Shares equal to (x) the difference between suchproduct and $15,000,000 divided by (y) such average closing price; and CELLGENESYS shall surrender to the

 

ii

----

 

Company the numberof Shares by which the Up Front Shares are decreased, promptly following theend of such ten (10) day period, at a price per share equal to the par value ofeach such share, which price shall be deemed paid in partial consideration forthe execution and delivery by Company of the License Agreement.

 

**SECTION 2** Closing and Delivery

 

**2.1          Sale of Shares**.Subject to the terms and conditions of this Agreement and in reliance upon therepresentations, warranties and agreements contained herein, the Company willissue and sell to CELL GENESYS, and CELL GENESYS will purchase from theCompany, at each of the Closings, the applicable number of Shares, at a priceper share equal to the par value of each such share at such time, which priceshall be deemed paid in partial consideration for the execution and delivery byCELL GENESYS of the License Agreement.

 

**2.2          Closings**. Theclosings of the purchase and sale of the Shares to be issued pursuant to thisAgreement shall be held at the offices of Hale and Dorr LLP, 60 State Street,Boston, Massachusetts, 02109 in three tranches, as follows:

 

**(a)          **Within ten days ofexecution of the License Agreement, at a date mutually agreed by the partieshereto, the closing of the purchase and sale of the Up Front Shares will occur(the “*First Tranche Closing*”);

 

**(b)          **Within [**] of theachievement of the milestone in Section 4.3(a) of the License Agreement, ifachieved, at a date mutually agreed by the parties hereto, the closing of thepurchase and sale of the First Milestone Shares will occur (the “*Second Tranche Closing*”); and

 

**(c)          **Within [**] of theachievement of the milestone in Section 4.3(b) of the License Agreement, ifachieved,, at a date mutually agreed by the parties hereto, the closing of thepurchase and sale of the Second Milestone Shares will occur (the “*Third Tranche Closing*”).

 

Each of the FirstTranche Closing, Second Tranche Closing and Third Tranche Closing arecollectively hereinafter referred to as the “*Closings*”and individually as a “*Closing*”.

 

**2.3          Delivery of the Shares**.Promptly following a Closing, the Company shall deliver to CELL GENESYS acertificate representing the number of Shares purchased at such Closing,registered in the name of CELL GENESYS.

 

**SECTION 3** Representations, Warranties andCovenants of the Company.

 

Subject to and except as set forth on the Schedule ofExceptions which is arranged in sections corresponding to the sub-sectionnumbered provisions contained below in this Section and except as described inthe SEC Reports (as defined below), the Company

 

iii

----

 

hereby representsand warrants to, and covenants with, CELL GENESYS as of the date hereof asfollows:

 

**3.1          Organization and Qualification**.The Company is a corporation duly organized, validly existing and in goodstanding under the laws of the State of Delaware and has all requisitecorporate power and authority to perform its obligations hereunder and toconsummate the transactions contemplated hereby.

 

**3.2          Due Execution, Delivery andPerformance**. The Company’s execution, delivery andperformance of this Agreement and the issuance and sale of the Shares have beenduly authorized by all requisite corporate action by the Company.  Upon the execution and delivery by theCompany, and assuming the valid execution and delivery of this Agreement byCELL GENESYS, this Agreement will constitute the valid and binding obligationof the Company, enforceable in accordance with its terms, except asenforceability may be limited by applicable bankruptcy, insolvency,reorganization, moratorium or similar laws affecting creditors’ and contractingparties’ rights generally and except as enforceability may be subject togeneral principles of equity (regardless of whether such enforceability isconsidered in a proceeding in equity or at law), including specificperformance, and except as the indemnification provisions contained in Section8.3 hereof may be legally unenforceable.

 

**3.3          No Conflicts**. TheCompany’s execution, delivery and performance of this Agreement and theissuance of the Shares will not violate, conflict with, result in a breach ofor constitute (upon notice or lapse of time or both) a default under, or resultin the creation or imposition of any lien, security interest, mortgage, pledge,charge or other encumbrance, of any material nature, upon any properties orassets of the Company under any (a) law, regulation, rule, injunction,judgment, order, decree, ruling, charge or other restriction of any government,governmental agency, court or arbitrator to which the Company is subject, (b)the Company’s Amended Restated Certificate of Incorporation or Bylaws or (c)any provision of any material indenture, mortgage, agreement, contract or othermaterial instrument to which the Company is a party or by which the Company orany of its properties or assets is bound as of the date hereof, except in thecase of clause (a) and clause (c), where such violation, conflict, breach,default, or imposition would not have a Material Adverse Effect.  As used in this Agreement, a “MaterialAdverse Effect” means (a) a material adverse effect upon the business,operations, properties, assets or condition (financial or otherwise) of theCompany or, as the case may be, the Company and any of its subsidiaries, takenas a whole or (b) a material impairment of the ability of the Company toperform its obligations under this Agreement.

 

**3.4          Governmental Consents**.Except for applicable filings with The Nasdaq Stock Market, Inc. (the “Nasdaq Market”),under the Securities Act of 1933, as amended (the “Securities Act”), or theSecurities Exchange Act of 1934, as amended (the “Exchange Act”), or statesecurities laws, no consent, approval, qualification, order or authorizationof, or filing with, any local, state, or federal governmental authority is

 

iv

----

 

required on thepart of the Company in connection with the Company’s valid execution, delivery,or performance of this Agreement, or the offer, sale or issuance of the UpFront Shares by the Company, other than any post-closing filings as may berequired under applicable federal or state securities laws, which will betimely filed within the applicable periods therefor.

 

**3.5          Issuance and Sale of the Securities**.When issued and paid for in accordance with this Agreement, the Shares to besold hereunder by the Company will be validly issued and outstanding, fullypaid and non-assessable.

 

**3.6          SEC Reports**.

 

**(a)          **Since January 1,2001, the Company has filed in a timely manner with the Securities and ExchangeCommission (the “*SEC*”) allreports (“*SEC Reports*”) requiredto be filed by it under the Exchange Act. All of the SEC Reports filed by the Company comply in all materialrespects with the requirements of the Exchange Act.  To the knowledge of the Company, none of the SEC Reports contain,as of the respective dates thereof, any untrue statement of a material fact oromit to state any material fact required to be stated therein or necessary tomake the statements therein not misleading in light of the circumstances underwhich they were made.

 

**(b)          **No event hasoccurred since January 1, 2002, requiring the filing of an SEC Report that hasnot heretofore been filed and furnished to CELL GENESYS (including, withoutlimitation, any amendment to any such SEC Report).

 

**3.7          Capitalization**. Theauthorized capital stock of the Company consists of (i) 100,000,000 sharesof Common Stock, par value $0.01 per share, of which 34,383,308 were issued andoutstanding as of April 10, 2002 and (ii) 10,000,000 shares of preferred stock,par value $0.01 per share, of which no shares are issued and outstanding on thedate hereof.  As of the date hereof, theCompany has no intention, obligation or commitment, fixed or contingent, toissue any shares of such Preferred Stock, other than pursuant to itsStockholders’ Rights Plan.

 

**3.8          Nasdaq Compliance**.The Company’s Common Stock is registered pursuant to Section 12(g) of theExchange Act, and is listed on the Nasdaq National Market (the “Nasdaq StockMarket”), and the Company has taken no action designed to, or which to itsknowledge is likely to have the effect of, terminating the registration of theCommon Stock under the Exchange Act or delisting the Common Stock from theNasdaq Stock Market. The issuance of the shares does not require stockholderapproval, including, without limitation, pursuant to the Nasdaq MarketplaceRules.

 

**3.9          Form S-3 Eligibility**.The Company qualifies as a registrant whose securities may be resold pursuant toForm S-3 promulgated by the SEC pursuant to the 1933 Securities Act, asamended.

 

v

----

 

**3.10        Absence of Litigation**.There is no action, suit, proceeding or investigation pending or, to theCompany’s best knowledge, that has been filed, commenced or threatened, by orbefore any governmental agency, court or arbitrator against the Company whichmight have, either individually or in the aggregate, a Material Adverse Effect(including, without limitation, any such action, suit, proceeding orinvestigation that questions the validity of this Agreement or the issuance ofthe Shares hereunder).

 

**3.11        Legal Compliance**. Tothe Company’s knowledge, the Company is not in default or violation of itsAmended  Restated Certificate ofIncorporation or Bylaws and has not violated any applicable laws (including,without limitation, rules, regulations, codes, plans, injunctions, judgments,orders, decrees, rulings and charges thereunder) of federal, state, local andforeign governments (and all agencies thereof) in respect of the conduct of itsbusiness or the ownership of its properties which default violation would(either individually or in the aggregate) have a Material Adverse Effect.  To the knowledge of the Company, there existsno condition, event or act which constitutes, or which after notice, lapse oftime or both, would constitute, such a default or violation under any of theforegoing except where such a default is not reasonably expected to have aMaterial Adverse Effect.

 

**3.12        Securities Act Exemption**.Assuming and relying in part on the truth and accuracy of CELL GENESYS’representations and warranties in Section 4 of this Agreement, the offer, saleand issuance of the Shares is exempt from registration under the SecuritiesAct.

 

**3.13        No Manipulation of Stock**.The Company has not taken and will not, in violation of applicable law, take,any action outside the ordinary course of business designed to or that mightreasonably be expected to cause or result in unlawful manipulation of the priceof the Common Stock to facilitate the sale or resale of the Shares by CELLGENESYS.

 

**3.14        Brokers**. Neither theCompany nor any of the officers, directors or employees of the Company hasemployed any broker or finder in connection with the transaction contemplatedby this Agreement.  The Company shallindemnify CELL GENESYS from and against any broker’s, finder’s or agent’s feesfor which the Company is responsible.

 

**SECTION 4** Representations, Warranties andCovenants of Cell Genesys.

 

**4.1         **Authority, Approvaland Enforceability.

 

CELL GENESYS represents and warrants to and covenantswith the Company that:

 

vi

----

 

**(a)          **CELL GENESYS is acorporation duly organized, validly existing and in good standing under thelaws of the State of Delaware and has all requisite corporate power andauthority to perform its obligations hereunder and to consummate thetransactions contemplated hereby..

 

**(b)          **CELL GENESYS’execution, delivery and performance of this Agreement have been duly authorizedby all requisite corporate action by CELL GENESYS.  Upon the execution and delivery by CELL GENESYS, and assuming thevalid execution and delivery of this Agreement by the Company, this Agreementwill constitute a valid and binding obligation of CELL GENESYS, enforceable inaccordance with its terms, except as enforceability may be limited byapplicable bankruptcy, insolvency, reorganization, moratorium or similar lawsaffecting creditors’ and contracting parties’ rights generally and except asenforceability may be subject to general principles of equity (regardless ofwhether such enforceability is considered in a proceeding in equity or at law),including specific performance, and except as the indemnification provisionscontained in Section 8.3 hereof may be legally unenforceable.

 

**4.2          Investment Representations**.CELL GENESYS understands that the Shares have not been registered under theSecurities Act. CELL GENESYS also understands that the Shares are being offeredand sold pursuant to an exemption from registration contained in the SecuritiesAct based in part upon CELL GENESYS’ representations contained in theAgreement, including this Section 4.2. CELL GENESYS represents and warrants to, and covenants with, the Companythat as of the date hereof and as of the date of any issuance of Shareshereunder:

 

**(a)          **CELL GENESYS hassubstantial experience in evaluating and investing in private purchases ofsecurities in companies similar to the Company so that it is capable of evaluatingthe merits and risks of its investment in the Company and has the capacity toprotect its own interests.  CELL GENESYSmust bear the economic risk of this investment indefinitely unless the Sharesare registered pursuant to the Securities Act, or an exemption fromregistration is available.

 

**(b)          **CELL GENESYS hasbeen advised or is aware of the provisions of Rule 144 promulgated under theSecurities Act, which permits limited resale of shares purchased in a privatepurchase subject to the satisfaction of certain conditions.

 

**(c)          **CELL GENESYS agreesthat it will not sell, assign or transfer, (collectively, “*Transfer*”) any of the Shares unless theTransfer will be made pursuant to an exemption from the registrationrequirements of the Securities Act or pursuant to an effective registrationstatement under the Securities Act and pursuant to an exemption from anyapplicable state securities laws or an effective registration or otherqualification under any applicable state securities laws. CELL GENESYS understandsthat exemptions from such registration requirements are limited. The Company isunder no obligation to register the Shares except as provided in Section 8.

 

vii

----

 

**(d)          **CELL GENESYSacknowledges and agrees that the Shares are subject to certain restrictions asto resale under the federal and state securities laws. CELL GENESYS agrees andunderstands that stop transfer instructions will be given to the transfer agentfor the Shares, and each share certificate and each certificate delivered ontransfer of or in substitution for any such certificate, shall have affixed alegend in substantially the following form:

 

“The shares represented by this certificate have notbeen registered under the Securities Act of 1933, as amended (the “Act”), andmay not be offered, sold or otherwise transferred, assigned, pledged orhypothecated unless and until registered under the Act or unless the Companyhas received an opinion of counsel satisfactory to the Company and its counselthat such registration is not required.”

 

**(e)          **CELL GENESYS isacquiring the Shares for its own account for investment only, and not with aview towards their distribution or sale, nor with any present intention ofdistributing or selling the same (except in compliance with securities laws),and except as set forth herein, CELL GENESYS has no present or contemplatedagreement, understanding, obligation, or commitment providing for thedisposition thereof.

 

**(f)           **CELL GENESYSrepresents that by reason of its, or of its management’s, business or financialexperience, it has the capacity to protect its own interests in connection withthe transactions contemplated in this Agreement.  Further, CELL GENESYS is aware of no publication of anyadvertisement in connection with the transactions contemplated in theAgreement.

 

**(g)          **CELL GENESYSrepresents that it is an accredited investor within the meaning of Regulation Dunder the Securities Act.

 

**(h)          **CELL GENESYS hashad an opportunity to discuss the Company’s business, management and financialaffairs with directors, officers and management of the Company and has had theopportunity to review the Company’s operations and facilities.  CELL GENESYS has also had the opportunity toask questions of and receive answers from, the Company and its managementregarding the terms and conditions of this investment.

 

**4.3          No Manipulation of Stock**.CELL GENESYS has not taken and will not, in violation of applicable law, take,any action outside the ordinary course of business designed to or that mightreasonably be expected to cause or result in unlawful manipulation of the priceof the Company’s Common Stock to facilitate the sale or resale of the Shares.

 

viii

----

 

**SECTION 5** Survival of Representations,Warranties and Agreements.

 

Notwithstanding any investigation made by any party tothis Agreement, all covenants, agreements, representations and warranties madeby the Company and CELL GENESYS herein shall survive the execution of thisAgreement and the issuance and sale to CELL GENESYS of the Shares and shallterminate one year after the achievement of, or failure to achieve, as the casemay be, the last remaining milestone under the License Agreement; *provided, however*, that the representationsand warranties in Section 3.6 and Section 3.10 shall survive the execution ofthis Agreement for 18 months from the date of the First Tranche Closing.

 

**SECTION 6** Conditions to Company’sObligations at the Closing.

 

The Company’s obligation to complete the sale andissuance of the Shares at each Closing shall be subject to the followingconditions to the extent not waived by the Company:

 

**6.1          Representations and Warranties Correct**.The representations and warranties made by CELL GENESYS in Sections 4.1,4.2  and 4.3 hereof shall be true andcorrect when made, and shall be true and correct on the date of the FirstTranche Closing.  Moreover, with respectto the Second Tranche Closing and Third Tranche Closing, the representationsand warranties made by CELL GENESYS in Section 4.2  hereof shall be true and correct on the respective dates of suchClosings.

 

**6.2          Compliance Certificate; CertifiedResolutions.** At the First Tranche Closing, CELL GENESYS shallhave delivered to the Company a compliance certificate, executed by the ChiefExecutive Officer of CELL GENESYS, dated as of the date of the First TrancheClosing, to the effect that the conditions, specified in Sections 6.1 have beensatisfied.

 

**SECTION 7** Conditions to Cell Genesys’Obligations At the Closing.

 

CELL GENESYS’ obligation to purchase the Shares ateach Closing shall be subject to the following conditions to the extent notwaived by CELL GENESYS:

 

**7.1          Representations and Warranties Correct**.The representations and warranties made by the Company in Section 3 hereofshall be true and correct when made, and shall be true and correct as of thedate of the First Tranche Closing.

 

**7.2          Legal Opinion**. CELLGENESYS shall have received from counsel to the Company, an opinion letteraddressed to CELL GENESYS, with respect to the issuance of the Shares, dated asof the date of each Closing, in a form customarily and usually delivered by lawfirms of publicly traded companies in stock issuances of the naturecontemplated by this Agreement.

 

ix

----

 

**7.3          Covenants Performed**.All covenants, agreements and conditions contained herein to be performed bythe Company on or prior to the date of each Closing shall have been performedor complied with in all material respects.

 

**7.4          Qualifications**. Allauthorizations, approvals, or permits, if any, of any governmental authority orregulatory body of the United States or of any state that are binding upon theCompany and that are required in connection with the lawful sale and issuanceof the Shares at such Closing pursuant to this Agreement shall have been dulyobtained and shall be effective on and as of the date of each Closing.  No stop order or other order enjoining thesale of the Shares shall have been issued and no proceedings for such purposeshall be pending or, to the knowledge of the Company, threatened by the SEC, orany commissioner of corporations or similar officer of any state havingjurisdiction over this transaction.

 

**7.5          Legal Investment**. Atthe time of each Closing, the sale and issuance of the Shares shall be legallypermitted by all laws and regulations to which CELL GENESYS and the Company aresubject.

 

**7.6          Compliance Certificate; CertifiedResolutions**. At the First Tranche Closing, the Company shallhave delivered to CELL GENESYS (i) a compliance certificate, executed by theChief Executive Officer of the Company, dated as of the First Tranche Closing,to the effect that the conditions, specified in Sections 7.1, 7.3 and 7.4 havebeen satisfied; and (ii) a certificate of the Secretary of the Companyevidencing the effective authorization of the issuance of the Stock by theCompany’s Board of Directors as of the date of each Closing.

 

**SECTION 8** Registration of the Shares;Compliance with the Securities Act.

 

**8.1          Definitions**. As usedin this Section 8 the following terms shall have the following respectivemeanings:

 

**(a)          **“*Registrable Shares*” shall mean all Sharesissued pursuant to this Agreement (which, for greater certainty, shall includethe Up Front Shares, the First Milestone Shares and the Second MilestoneShares, when issued) and any other shares of Common Stock issued or issuable inrespect to the Shares (because of stock splits, stock dividends,reclassifications, recapitalizations, adjustments pursuant to this Agreement orsimilar events);

 

**(b)          **“*Untrue Statement*” shall mean any untruestatement or alleged untrue statement, or any omission or alleged omission tostate in the Registration Statement a material fact required to be statedtherein or necessary to make the statements therein, in the light of thecircumstances under which they were made, not misleading.

 

x

----

 

**8.2          Registration Procedures and Expenses**.The Company shall:

 

**(a)          **within fourteen(14) days immediately following each Closing, such actual date being referredto as the “*Registration Date,*”prepare and file with the SEC a registration statement on Form S-3 in order toregister with the SEC under the Securities Act a sale by CELL GENESYS on a delayedor continuous basis pursuant to Rule 415 under the Securities Act any or all ofthe Registrable Shares then issued at such Closing through the automatedquotation system of the Nasdaq National Market System or the facilities of anynational securities exchange on which the Company’s Common Stock is thentraded, or in privately-negotiated transactions (a “*Registration Statement*”) (notwithstanding anything to thecontrary expressed or implied herein, if a registration statement on Form S-3,or any substitute form, is not then available for registration of theRegistrable Shares, the Company shall be obligated instead to prepare and filewith the SEC a registration statement on Form S-1 in order to register theRegistrable Shares under the Securities Act and such registration statementwill be a “Registration Statement” for the purposes of this Agreement);

 

**(b)          **subject to receiptof necessary information from CELL GENESYS, use its commercially reasonablyefforts to cause such Registration Statement to become effective as soon aspossible after the Registration Date, and take all other reasonable actionsnecessary under any federal law or regulation to permit all Registrable Sharesto be sold or otherwise disposed of thereunder;

 

**(c)          **promptly notifyCELL GENESYS, at any time when a prospectus relating to such RegistrationStatement is required to be delivered under the Securities Act, of thehappening of any event as a result of which the prospectus included in orrelating to such Registration Statement contains an Untrue Statement;

 

**(d)          **promptly prepareand file with the SEC, and deliver to CELL GENESYS, such amendments andsupplements to such Registration Statement and the prospectus used inconnection therewith as may be necessary to keep such Registration Statementeffective until termination of such obligation as provided in Section 8.7below;

 

**(e)          **furnish to CELLGENESYS such number of copies of prospectuses in conformity with therequirements of the Securities Act, in order to facilitate the public sale orother disposition of all or any of the Registrable Shares by CELL GENESYS;

 

**(f)           **file suchdocuments as may be required of the Company for normal state securities lawclearance for the resale of the Registrable Shares in which states of theUnited States as may be reasonably requested by CELL GENESYS provided, however,that the Company shall not be required in connection with this paragraph (f) toqualify as a foreign corporation or execute a general consent to service ofprocess in any jurisdiction;

 

xi

----

 

**(g)          **no later than theRegistration Date, use its best efforts to cause all Registrable Shares to belisted on each securities exchange, if any, on which equity securities by theCompany are then listed; and

 

**(h)          **bear all expensesin connection with the procedures in Section 8.2, other than (i) fees andexpenses, if any, of counsel or other advisers to CELL GENESYS, and (ii) anyexpenses relating to the sale of the Registrable Shares by CELL GENESYS,including broker’s commission, discounts or fees and transfer taxes.

 

**8.3          Indemnification**.

 

**(a)          **The Company agreesto indemnify and hold harmless CELL GENESYS (and each person, if any, whocontrols CELL GENESYS within the meaning of Section 15 of the Securities Act)from and against any losses, claims, damages or liabilities to which CELLGENESYS may become subject (under the Securities Act or otherwise) insofar assuch losses, claims, damages or liabilities (or actions or proceedings inrespect thereof) arise out of, or are based upon, any Untrue Statementcontained in the Registration Statement on the effective date thereof, or ariseout of any failure by the Company to fulfill any undertaking included in theRegistration Statement and the Company will reimburse CELL GENESYS for anyreasonable legal or other expenses reasonably incurred in investigating,defending or preparing to defend any such action, proceeding or claim; *provided,however,* that the Company shall not be liable in any such case tothe extent that such loss, claim, damage or liability arises out of, or isbased upon, an Untrue Statement made in such Registration Statement in relianceupon and in conformity with written information furnished to the Company by oron behalf of CELL GENESYS specifically for use in preparation of theRegistration Statement, or the failure of CELL GENESYS to comply with thecovenants and agreements contained in Section 8.4 hereof respecting the sale ofthe Registrable Shares or any statement or omission in any prospectus that iscorrected in any subsequent prospectus that was delivered to CELL GENESYS priorto the pertinent sale or sales by CELL GENESYS.

 

**(b)          **CELL GENESYS agreesto indemnify and hold harmless the Company and underwriter (and each person, ifany, who controls the Company within the meaning of Section 15 of theSecurities Act, each officer of the Company who signs the RegistrationStatement and each director of the Company) from and against any losses,claims, damages or liabilities to which the Company (or any such underwriter,officer, director or controlling person) may become subject (under theSecurities Act or otherwise), insofar as such losses, claims, damages orliabilities (or actions or proceedings in respect thereof) arise out of, or arebased upon, any failure to comply with the covenants and agreements containedin Section 8.4 hereof respecting sale of the Registrable Shares, or any UntrueStatement made in the Registration Statement on the effective date thereof ifsuch Untrue Statement was made in reliance upon and in conformity with writteninformation furnished by or on behalf of CELL GENESYS specifically for use inpreparation of the Registration Statement, and CELL GENESYS

 

xii

----

 

will reimburse theCompany (or such underwriter, officer, director or controlling person), as thecase may be, for any legal or other expenses reasonably incurred ininvestigating, defending or preparing to defend any such action, proceeding orclaim; *provided*that in no event shall any indemnity by CELL GENESYS under thisSection 8.3 exceed the net proceeds received by CELL GENESYS from the saleof the Registrable Shares covered by such Registration Statement.

 

**(c)          **Promptly afterreceipt by any indemnified person of a written notice of a claim or thebeginning of any action in respect of which indemnity is to be sought againstan indemnifying person pursuant to this Section 8.3, such indemnified personshall notify the indemnifying person in writing of such claim or of the commencementof such action, and, subject to the provisions hereinafter stated, in case anysuch action shall be brought against an indemnified person and suchindemnifying person shall have been notified thereof, such indemnifying personshall be entitled to participate therein, and, to the extent it shall wish, toassume the defense thereof, with counsel reasonably satisfactory to suchindemnified person.  After notice fromthe indemnifying person to such indemnified person of its election to assumethe defense thereof, such indemnifying person shall not be liable to suchindemnified person for any legal expenses subsequently incurred by suchindemnified person in connection with the defense thereof; *provided, however*, that ifthere exists or shall exist a conflict of interest that would make itinappropriate, in the opinion of counsel to the indemnified person, for thesame counsel to represent both the indemnified person and such indemnifyingperson or any affiliate or associate thereof, the indemnified person shall beentitled to retain its own counsel at the expense of such indemnifying person; *provided,however*, that no indemnifying person shall be responsible for thefees and expenses of more than one separate counsel for all indemnifiedparties; *provided,however*, that no person guilty of fraudulent misrepresentation(within the meaning of Section 11(f) of the Securities Act) shall be entitledto contribution from any person who was not guilty of such fraudulentmisrepresentation.  No indemnifyingparty, in the defense of any such claim or litigation shall, except with theconsent of each indemnified party, consent to entry of any judgment or enterinto any settlement which does not include as an unconditional term thereof thegiving by the claimant or plaintiff to such indemnified party of a release fromall liability in respect to such claim or litigation.  No indemnified party may settle or agree to settle any claim orlitigation as to which indemnification may be sought hereunder without theprior written consent of the indemnifying party.  Each indemnified party shall furnish such information regardingitself or the claim in question as an indemnifying party may reasonably requestin writing as shall be reasonably required in connection with the defense ofsuch claim and litigation resulting therefrom.

 

**(d)          **If theindemnification provided for in this Section 8.3 is held by a court ofcompetent jurisdiction to be unavailable to an indemnified party with respectto any loss, liability, claim, damage, or expense referred to therein, then theindemnifying party, in lieu of indemnifying such indemnified party hereunder,shall contribute to the amount paid or payable by such indemnified party as aresult of such loss, liability, claim,

 

xiii

----

 

damage, or expensein such proportion as is appropriate to reflect the relative fault of theindemnifying party on the one hand and of the indemnified party on the other inconnection with the statements or omissions that resulted in such loss,liability, claim, damage, or expense as well as any other relevant equitableconsiderations.  The relative fault ofthe indemnifying party and of the indemnified party shall be determined byreference to, among other things, whether the untrue or alleged untruestatement of material fact or the omission to state a material fact relates toinformation supplied by the indemnifying party or by the indemnified party andthe parties’ relative intent, knowledge, access to information, and opportunityto correct or prevent such statement or omission; *provided*, that in no eventshall any contribution by CELL GENESYS hereunder exceed the net proceedsreceived by CELL GENESYS from the sale of the Shares covered by theRegistration Statement.

 

**8.4          Transfer of Shares After Registration;Notice**. CELL GENESYS hereby covenants with the Company not tomake any sale of the Registrable Shares after registration without effectivelycausing the prospectus delivery requirement under the Securities Act to be satisfied,and not to make sale of the Registrable Shares under the Registration Statementif the Company has notified it that the Registration Statement contains anUntrue Statement.

 

**8.5          Reporting Requirements**.The Company agrees to use its best efforts to:

 

**(a)          **make and keeppublic information available, as those terms are understood and defined in Rule144 under the Securities Act;

 

**(b)          **file with the SECin a timely manner all reports and other documents required of the Companyunder the Securities Act and the Securities Exchange Act of 1934; and

 

**(c)          **so long as CELLGENESYS own Registrable Shares, to furnish to CELL GENESYS forthwith uponrequest (1) a written statement by the Company as to whether it complies withthe reporting requirements of said Rule 144, the Securities Act and SecuritiesExchange Act of 1934, and whether it qualifies as a registrant whose securitiesmay be resold pursuant to SEC Form S-3, and (2) such other information as maybe reasonably requested in availing CELL GENESYS of any rule or regulation ofthe SEC that would permit the selling of the Registrable Shares withoutregistration.

 

**8.6         **Limitations onRegistration Rights.

 

**(a)          **Notwithstanding theprovisions of this Section 8, the Company may be written notice to CELL GENESYSrequire that CELL GENESYS immediately cease sales of shares under theRegistration Statement (“Suspended Registration Statement”), in any periodduring which the Company is engaged in any activity or transaction or preparations or negotiations for anyactivity or transaction (“Company Activity”) that the Company desires to keepconfidential for business reasons, if the

 

xiv

----

 

Company determinesin good faith that the public disclosure requirements imposed on the Companyunder the Securities Act in connection with any such Registration Statementwould require disclosure of the Company Activity; provided, that (i) that theCompany shall not suspend the use of said prospectus more than two times in anytwelve month period and the duration of any one such suspension shall not bemore than thirty (30) days and (ii) the Company shall cause any SuspendedRegistration Statement to remain effective for one additional day for each day,or any portion of a day, that CELL GENESYS was required to cease sales ofshares thereunder, *and provided further*,that the Company shall use its commercially reasonable efforts to minimize theduration of any such suspension; and

 

**(b)          **If the Companyrequires CELL GENESYS to cease sales of shares pursuant to Section 8.6(a)above, the Company shall, as promptly as practicable following the terminationof the circumstance which entitled the Company to do so, give prompt writtennotice to CELL GENESYS that such circumstance has terminated and that it mayresume sales pursuant to the Suspended Registration Statement has been amendedto comply with the requirements of the Securities Act, the Company shallenclose such revised prospectus with the notice to CELL GENESYS given pursuantto this section 8.6(b) and CELL GENESYS shall make no offers or sales of sharespursuant to such Suspended Registration Statement other than by means of suchrevised prospectus.  The foregoingprovisions of this Section 8.6 shall in no manner diminish or otherwise impairthe Company’s obligations under Section 8.2 and Section 8.3 hereof.

 

**8.7          Termination of Obligations**.The obligations of the Company pursuant to Sections 8.2 through 8.5 hereof withrespect to Registrable Shares issued at a Closing and the RegistrationStatement covering such Shares shall cease and terminate at such time as all ofsuch Registrable Shares (i) have been resold or (ii) such time as all of suchRegistrable Shares held by such Purchaser may be sold during any 90 day periodpursuant to Rule 144, including Rule 144 (k), without being restricted by thevolume limitations of Rule 144(e).

 

**SECTION 9 NOTICES**.

 

All notices orother communications which are required or permitted hereunder shall be inwriting and addressed as follows:

 
| if to CELL  GENESYS: | Cell Genesys,  Inc.                    |
|----------------------|----------------------------------------|
|                 | 342 Lakeside  Drive                    |
|                 | Foster City, CA  94404                 |
|                 |                                   |
| Attention:           | Robert Tidwell                         |
|                 | Vice President,  Corporate Development |

 

xv

----

 
| with a copy to:    | Cooley Godward  LLP                    |
|--------------------|----------------------------------------|
|               | 3000 El Camino  Real                   |
|               | Palo Alto, CA 94306-2155               |
|               |                                   |
| Attention:         | Barclay J. Kamb, Esq.                  |
|               |                                   |
| if to the Company: | Transkaryotic  Therapies, Inc.         |
|               | 195 Albany  Street                     |
|               | Cambridge,  MA  02139             |
|               |                                   |
| Attention:         | Richard F Selden                       |
|               | President and  Chief Executive Officer |
|               |                                   |
| with a copy to:    | Kerry A. Flynn                         |
|               | Senior Director,  Business Development |

 

or to such otheraddress as the party to whom notice is to be given may have furnished to theother party in writing in accordance herewith. Any such communication shall be deemed to have been given when deliveredif personally delivered or sent by facsimile (provided that the party providingsuch notice promptly confirms receipt of such transmission with the other partyby telephone), on the business day after dispatch if sent by anationally-recognized overnight courier and on the third business day followingthe date of mailing if sent by mail, postage prepaid, return receipt requested.

 

**SECTION 10 MISCELLANEOUS**.

 

**10.1        Waivers and Amendments**.Neither this Agreement nor any provision hereof may be changed, waived, discharged,terminated, modified or amended except upon the written consent of the partieshereto.

 

**10.2        Headings**. The headingsof the various sections of this Agreement have been inserted for convenience ofreference only and shall not be deemed to be part of this Agreement.

 

**10.3        Severability**. If anyprovision hereof should be held invalid, illegal or unenforceable in anyrespect, then, to the fullest extent permitted by law, (a) all other provisionshereof shall remain in full force and effect and shall be liberally construedin order to carry out the intentions of the Parties as nearly as may bepossible and (b) the parties shall use their best efforts to replace theinvalid, illegal or unenforceable provision(s) with valid, legal andenforceable provision(s) which, insofar as practical, implement the purposes ofsuch provision(s) in this Agreement.

 

**10.4        Governing Law**. ThisAgreement shall be governed by and construed in accordance with the laws of theState of Delaware as applied to contracts entered into and

 

xvi

----

 

performed entirelyin the State of Delaware by Delaware residents, without regard to conflicts oflaw principles.

 

**10.5        Counterparts**. ThisAgreement may be executed in two or more counterparts, each of which shallconstitute an original, but all of which, when taken together, shall constitutebut one instrument, and shall become effective when one or more counterpartshave been signed by each party hereto and delivered to the other parties.

 

**10.6        Successors and Assigns**.Except as otherwise expressly provided herein, the provisions hereof shallinure to the benefit of, and be binding upon, the successors, assigns, heirs,executors and administrators of the parties hereto, provided that CELL GENESYSshall not assign its rights or obligations hereunder unless CELL GENESYSassigns such rights in whole and not in part to an assignee of such rights andobligations which shall agree in writing with the Company to be bound by thisAgreement.  The Company shall not,directly or indirectly, enter into any merger, consolidation or reorganizationin which the Company shall not be the surviving corporation unless the proposedsurviving corporation shall, prior to such merger, consolidation orreorganization, agree in writing to assume the obligations of the Company underthis Agreement; provided, however, that the provisions of this Section 10.6shall not apply in the event of any merger, consolidation or reorganization inwhich the Company is not the surviving corporation if CELL GENESYS is entitledto receive in exchange for their Registrable Shares consideration consistingsolely of (i) cash, or (ii) securities of the acquiring corporation which maybe immediately sold to the public without registration under the SecuritiesAct.

 

**10.7        Expenses**. Each partyshall pay all costs and expenses that it incurs with respect to thenegotiation, execution, delivery and performance of this Agreement.

 

**10.8        Entire Agreement**. ThisAgreement, the License Agreements and other documents delivered pursuant heretoand thereto, including the exhibits, constitute the full and entireunderstanding and agreement between the parties with regard to the subjectshereof and thereof.

 

**10.9        Publicity**. No partyshall issue any press releases or otherwise make any public statement withrespect to the transactions contemplated by this Agreement without the priorwritten consent of the other party, except as may be required by applicable lawor regulations, in which case such party shall provide the other parties withreasonable notice of such publicity and/or opportunity to review suchdisclosure.

 

**10.10      Waiver of Rule of Construction.** Each Party has had the opportunity to consultwith counsel in connection with the review, drafting and negotiation of thisAgreement.  Accordingly, the rule ofconstruction that any ambiguity in this Agreement shall be construed againstthe drafting Party shall not apply.

 

xvii

----

 

**10.11      Termination.** ThisAgreement shall terminate when the Company’s obligation to issue additionalshares under the License Agreement terminates.

 

**IN WITNESS WHEREOF**,the parties hereto have caused this Stock Purchase Agreement to be executed bytheir duly authorized representatives as of the day and year first abovewritten.

 
| **TRANSKARYOTIC THERAPIES, INC.** | **CELL GENESYS, INC.** |
|-----------------------------------|------------------------|
|                              |                   |
|                              |                   |
| By:                               |                   |   | By: |   |   |
|                              |                   |   |   |   |   |
| Name:                             | Name:                  |
| Title:                            | Title:                 |

 

xviii

----