BioTime Signs Definitive Agreement With Geron Regarding Stem Cell Assets

ALAMEDA, Calif.--(BUSINESS WIRE)--

BioTime, Inc. (NYSE MKT: BTX) and its recently formed subsidiary BioTime Acquisition Corporation (BAC) jointly announced today that they have entered into a definitive Asset Contribution Agreement with Geron Corporation (GERN) to acquire the intellectual property, including patents and patent applications, and other assets related to Gerons human embryonic stem (hES) cell programs consistent with the financial terms outlined in the letter of intent announced on November 15, 2012.

Under the definitive agreement, Geron will contribute to BAC intellectual property, certain cell lines and other assets, including the Phase 1 clinical trial of hES cell-derived oligodendrocytes in patients with acute spinal cord injury, and Gerons autologous cellular immunotherapy program. BioTime will contribute to BAC $5 million in cash, 8,902,077 BioTime common shares to be held by BAC, five-year warrants to purchase 8,000,000 common shares of BioTime at a price of $5.00 per share (BioTime Warrants), rights to use certain clinical grade hES cell lines, a sublicense to use certain patents for stem cell differentiation technology, and minority stakes in two of BioTimes subsidiaries, OrthoCyte Corporation and Cell Cure Neurosciences Ltd. BAC will also pay to Geron royalties on the sale of products that are commercialized, if any, in reliance upon Geron patents contributed or licensed to BAC. A private investor has also agreed to provide an equity investment of $5 million in BAC and a $5 million equity investment in BioTime in conjunction with the transaction.

Geron pioneered the field of regenerative medicine in the mid-1990s by organizing the first effort to isolate human embryonic stem (hES) cells. hES cells are early-stage stem cells that are capable of becoming all of the cell types in the human body, and therefore are widely recognized as a means of manufacturing cells that are potentially useful in regenerating tissue function for a wide array of degenerative diseases. Currently, Gerons hESC patent portfolio includes over 400 patents and patent applications that will be transferred or sublicensed to BAC. Geron obtained the first approval from the Food and Drug Administration for human clinical trials of a product manufactured from hES cells.

Gerons former hES cell programs included oligodendrocyte progenitor cells for central nervous system disorders, cardiomyocytes for heart disease, pancreatic islet cells for diabetes, dendritic cells as an immunotherapy vehicle, and chondrocytes for cartilage repair. BAC may pursue the development of therapeutic products from some or all of these cell types, depending upon a number of factors, including the expected cost of development, sufficiency of financing, the state of development of the technology acquired, regulatory considerations, anticipated market size, and competition from other companies in the applicable fields. BAC may also seek to develop other therapeutic products, taking into account the same or other applicable considerations.

Our consistent goal at BioTime has been to consolidate the pluripotent stem cell technology platform, stated Michael West, Ph.D., Chief Executive Officer of BioTime, Inc. With this contribution of assets, the combined intellectual property estate in the BioTime family of companies will be among the strongest in the field of Regenerative Medicine; establishing our leadership in the industry and advancing product development.

We are excited aboutour approach toward consolidating themost importanttechnologies in Regenerative Medicine, said Thomas Okarma, M.D., Ph.D., president and CEO of BAC. Regenerative Medicineholds great promise for patientsand now, with our significant collection of world class stem cell technologies, IP, and experienced management, we arepositioned tohelp realize that promise.

Closing of the transactions under the definitive agreement is subject to certain negotiated closing conditions, including the registration of the BAC Series A common stock, the BioTime common shares contributed to BAC, and the BioTime Warrants under the Securities Act of 1933, as amended, and certain approvals by BioTime shareholders. The transaction is expected to close no later than September 30, 2013.

Upon closing of the transaction, Geron will receive BAC Series A common stock, and BioTime and the private investor will receive BAC Series B common stock in the transaction. The Series A and Series B common stock will be identical, except that BAC will be entitled to make certain distributions or pay dividends on its Series A common stock without making a distribution or paying a dividend on its Series B common stock.

Following the closing of the transaction, Geron will distribute on a pro rata basis to its stockholders the shares of BAC Series A common stock received in the transaction. Following that distribution by Geron, BAC will distribute on a pro rata basis to the holders of those shares the BioTime Warrants. The Series B common stock will be convertible into Series A common stock following the distribution of the BioTime Warrants.

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BioTime Signs Definitive Agreement With Geron Regarding Stem Cell Assets