Page 4 of 7 – SEC Filing
Except
as described above in this Item 4, the Board of Directors of the Reporting Person has not approved any plans or proposals that
relate to or would result in: (a) the acquisition by any person of additional securities of the Company, or the disposition of
securities of the Company; (b) an extraordinary corporate transaction, such as a merger, reorganization or liquidation, involving
the Company or any of its subsidiaries; (c) a sale or transfer of a material amount of assets of the Company or any of its subsidiaries;
(d) any change in the present Board of Directors or management of the Company, including any plans or proposals to change the
number or term of directors; (e) any material change in the present capitalization or dividend policy of the Company; (f) any
other material change in the Company’s business or corporate structure; (g) changes in the Company’s charter, bylaws
or instruments corresponding thereto or other actions which may impede the acquisition of control of the Company by any person;
(h) causing a class of securities of the Company to be delisted from a national securities exchange or to cease to be authorized
to be quoted in an inter-dealer quotation system of a registered national securities association; (i) a class of equity securities
of the Company becoming eligible for termination of registration pursuant to Section 12(g)(4) of the Exchange Act; or (j) any
action similar to any of those enumerated above.
As
previously reported in the Schedule 13D, the Reporting Person owned a majority of the issued and outstanding Series A Shares of
the Company until May 12, 2016. Although the Reporting Person now owns less than a majority of the issued and outstanding Series
A Shares of the Company the Reporting Person may exert significant influence over the Company. Three of the members of the Asterias
Board are members of the Reporting Person’s Board of Directors, and one director of the Company who is not a director of
the Reporting Person may be deemed an affiliate of a shareholder that beneficially owns more than 5% of the common shares of the
Reporting Person. The Reporting Person may, through the action of persons who serve on the Asterias Board acting in conjunction
with directors of the Company who are not affiliated with the Reporting Person, from time to time cause the Company to engage
in any or all of the kinds of transactions described in the immediately preceding paragraph. The Reporting Person, acting alone,
or if the vote of a majority of the outstanding Series A Shares of Company is required for the applicable action, acting in conjunction
with other stockholders of the Company, may, directly or through the action of the Asterias Board, (1) cause the Company to expand
the size of the Asterias Board and to elect additional directors, (2) cause the Company to reduce the size of the Asterias Board,
(3) nominate persons to stand for election as directors at any annual or special meeting of stockholders of the Company at which
directors are to be elected, (4) cause any incumbent director not to be nominated to stand for election as a director at any annual
or special meeting of stockholders of the Company at which directors are to be elected, (5) remove any director with or without
cause by a vote at any annual or special meeting of stockholders of the Company at which directors are to be elected, or by written
consent without a vote, (6) in the event of the death or resignation or removal of a director of the Company, elect a replacement
director, and (7) amend the Bylaws or the Certificate of Incorporation of the Company. Any such newly elected directors may be
officers, directors, or affiliates of the Reporting Person or may be “independent” directors (under Section 8.03(A)
of the NYSE MKT Company Guide or the rules of any other national securities exchange).
The
Reporting Person may also, from time to time, through the action of officers or directors of the Reporting Person who serve on
the Asterias Board acting with other Company directors who are not affiliated with the Reporting Person, cause or enable the Company
to (i) offer and sell additional securities in order to raise capital for the Company’s operations or to acquire one or
more businesses or assets for use in the Company’s business, or for other purposes, (ii) acquire Series A Shares from the
Reporting Person in exchange for cash, common shares of the Company, other assets of the Company, or a combination of the foregoing,
(iii) license patents and other intellectual property to, or cross license patents and other intellectual property or exchange
other assets with, and acquire other assets from, and sell assets to, the Reporting Person or one or more other subsidiaries of
the Reporting Person, and (iv) if and when opportunities present themselves, cause the Company to enter into one or more merger
agreements or other agreements to acquire other business or assets, or merger or consolidation agreements in which the Company
is not the surviving corporation.
The
Reporting Person may, from time to time, sell Series A Shares in transactions on the NYSE MKT at prices based on prevailing market
prices, in block transactions, or in privately negotiated transaction.
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