Exhibit 10.7

 

THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 OR
THE SECURITIES LAWS OF ANY STATE, AND ARE BEING OFFERED AND SOLD IN RELIANCE ON
REGISTRATION EXEMPTIONS AVAILABLE THEREUNDER. AS SUCH THE HOLDER MAY NOT BE ABLE
TO RESELL THE SECURITIES UNLESS PURSUANT TO REGISTRATION UNDER FEDERAL AND STATE
SECURITIES LAWS OR UNLESS A RESALE EXEMPTION UNDER SUCH LAWS EXISTS.

 

ADVANCED CELL TECHNOLOGY, INC.

BRIDGE NOTE

 

Up to $70,000.00

 

Los Angeles, California

 

 

March 17th, 2008

 

1.                                       Promise to Pay.  FOR VALUE RECEIVED,
the undersigned, ADVANCED CELL TECHNOLOGY, INC., a Delaware corporation
(referred to alternatively as the “Maker” or the “Company”), promises to pay to
the Shapiro Family Trust Dated September 25, 1989 or its assigns (the
“Noteholder”), at such place as the Noteholder hereof shall notify the Maker in
writing the principal amount of up to

 

SEVENTY Thousand Dollars ($70,000)

 

or so much of that sum as may be advanced and outstanding under this Convertible
Promissory Note (this “Note”).  This Note evidences a loan (the “Loan”) from the
Noteholder to the Maker. Advances under this Note shall be added to the
principal amount of the Loan, as and when made, as reflected in the Advance
Schedule attached hereto as Exhibit A.  Each payment under this Note shall be
credited against principal.  All amounts payable under this Note shall be paid
in lawful money of the United States of America during normal business hours on
a business day, in immediately available funds.  A Member of the Noteholder on
behalf of the Noteholder shall advance the Maker the sum of Seventy Thousand
Dollars ($70,000.00) upon execution of this Note.

 

2.                                       Principal.  All outstanding principal
and all accrued and unpaid interest and all other amounts owed hereunder (the
“Outstanding Balance”), unless earlier converted pursuant to the terms described
herein, shall be due and payable in one lump sum on April 7th, 2008 (the
“Maturity Date”) unless the Note has earlier been paid.

 

3.                                       Permitted Uses.  The proceeds of the
Loan may be used only for payment of Permitted Expenses, as defined herein. As
used herein, the term Permitted Expenses means reasonable and customary
operating expenses and capital expenditures related to the ongoing operation of
the Maker.

 

4.                                       Interest. (a) The principal sum
outstanding from time to time under this Note shall bear interest at a rate
equal to NINE percent (9%) per annum.

 

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5.                                       ENTITLEMENT OF THE NOTEHOLDER. Upon
funding of the Note, the Noteholder will have fulfilled any obligation however
defined of purchasing the Purchaser’s Pro Rata Share in the Next Financing The
Noteholder will be entitled to all rights and privileges given to any other
Purchaser in the Next Financing including the exercise of anti-dilution
protection, reset of any conversion price of any existing debentures and
warrants owned by the Noteholder at the date of the closing of the Next
Financing, and issuance of warrants under the same terms and conditions as if
the investment had been converted into that financing round.

 

6.                                       SECURITY: With the funding of this Note
and until full repayment is made, this note will rank pari pasu with the 2005,
2006 and 2007 Debentures which are the most senior obligations of the company.

 

7.                                       Representations and Warranties.  As an
inducement to the Noteholder to make the Loan, the Maker represents and warrants
to the Noteholder that:

 

(a)                                  The Maker is duly organized, validly
existing and in good standing as a corporation under the laws of the State of
Delaware. The Maker (i) has the corporate power and authority and the legal
right to own and operate its property and to conduct business in the manner in
which it does and proposes so to do, and (ii) is in compliance in all material
respects with all requirements of law and contractual obligations.

 

(b)                                 The Maker has the corporate power and
authority and the legal right to execute, deliver and perform this Note and has
taken all necessary corporate action to authorize the execution, delivery and
performance of this Note. This Note has been duly executed and delivered on
behalf of the Maker and constitutes the legal, valid and binding obligation of
the Maker enforceable against the Maker in accordance with its terms, subject to
the effect of applicable bankruptcy and other similar laws affecting the rights
of creditors generally and the effect of equitable principles whether applied in
an action at law or a suit in equity.

 

(c)                                  The execution, delivery and performance of
this Note, the borrowing hereunder and the use of the proceeds hereof, will not
violate any provision of Maker’s Certificate of Incorporation, Bylaws or
requirement of law.

 

8.                                       Affirmative Covenants; Noteholder
Acknowledgement; Noteholder Representation. The Maker agrees to provide the
Noteholder with prompt notice of any written commitments entered into which, if
closed, would constitute the Next Financing, and to provide the Noteholder with
at least twenty four hours’ prior notice of the closing of the Next Financing.
The Noteholder hereby represents and warrants to the Maker that the Noteholder,
is an ‘accredited investor’ as that term is defined in Rule 501(a) of Regulation
D promulgated under the Securities Act.

 

9.                                       Negative Covenants. The Maker agrees
that, as long as any obligations under this Note remain unpaid, it shall not,
directly or indirectly without the prior written consent of Noteholder:

 

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(a)                                  liquidate or dissolve or enter into any
sale, consolidation, merger, partnership, joint venture, syndicate or other
combination, unless the Maker is the surviving entity;

 

(b)                                 sell, lease, assign, transfer or otherwise
dispose of all or substantially all of Maker’s assets; provided that the Maker
may sell, lease, assign or transfer any portion of its real or personal
property; and

 

(c)                                  engage in any business activities
substantially different from the Maker’s business as described in its current
business plan delivered to Noteholder contemporaneously herewith.

 

10.                                 Events of Default. Upon the occurrence of
any of the following events (each, an “Event of Default”):

 

(a)                                  The Maker shall fail to pay any amount due
under this Note; or

 

(b)                                 Any representation or warranty made by the
Maker in this Note shall be materially inaccurate or incomplete; provided, that
any such inaccurate or incomplete representation or warranty shall not
constitute an Event of Default if it is corrected within five (5) days after any
officer or employee of the Maker obtains knowledge of such inaccuracy or
incompleteness, and the corrected or revised representation or warranty made by
the Maker is acceptable to the Noteholder; or

 

(c)                                  The Maker shall fail to observe or perform
in any material respect any of the other terms or provisions of this Note and
such failure shall continue for five (5) days; or

 

THEN, automatically upon the occurrence of an Event of Default at the option of
the Noteholder, in each case without notice to or demand upon the Maker or any
other party, the entire principal balance hereof together with all accrued and
unpaid interest thereon shall become immediately due and payable.

 

11.                                 Costs and Expenses.  If any default occurs
in any payment due under this Note, the Maker and all guarantors and endorsers
hereof, and their successors and assigns, promise to pay all costs and expenses,
including attorneys’ fees, incurred by the Noteholder hereof in collecting or
attempting to collect the indebtedness under this Note, whether or not any
action or proceeding is commenced, and hereby waive the right to plead any and
all statutes of limitation as a defense to a demand hereunder to the full extent
permitted by law.

 

12.                                 Acceptance of Past Due Payments and
Indulgences Not Waivers.  None of the provisions hereof and none of the
Noteholder’s rights or remedies hereunder on account of any past or future
defaults shall be deemed to have been waived by the Noteholder’s acceptance of
any past due installments or by any indulgence granted by the Noteholder to the
Maker.

 

13.                                 Waivers by the Maker; No Setoffs or
Counterclaims.  The Maker and all guarantors and endorsers hereof, and their
successors and assigns, hereby waive presentment,

 

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demand, protest and notice thereof or of dishonor, and agree that they shall
remain liable for all amounts due hereunder notwithstanding any extension of
time or change in the terms of payment of this Note granted by the Noteholder,
any change, alteration or release of any property now or hereafter securing the
payment hereof or any delay or failure by the Noteholder to exercise any rights
under this Note. All payments required by this Note shall be made without setoff
or counterclaim.

 

14.                                 Assignment. The Maker may not assign its
rights or obligations under this Note without the prior written consent of the
Noteholder and any such purported assignment by the Maker without obtaining the
prior written consent of the Noteholder shall be void ab initio. This Note shall
inure to the heirs, legal representatives, successors and assigns of the
Noteholder.

 

15.                                 Notices.  All notices given by the Maker or
the Noteholder hereunder to the other shall be in writing, delivered by
facsimile transmission (confirmed in writing) or delivered personally or by
depositing the same in the United States mail, registered, with postage prepaid,
addressed as follows:

 

Noteholder:

 

Shapiro Family Trust Dated September 25, 1989

 

 

17567 Camino de y Yatasto

 

 

Pacific Palisades, California 90272

 

 

 

Maker:

 

Advanced Cell Technology, Inc.

 

 

11100 Santa Monica Boulevard, Suite 850

 

 

Los Angeles, CA 90025

 

Either the Noteholder or the Maker may change the address to which notices are
to be sent by notice of such change to the other given as provided herein. Such
notices shall be effective on the date received or, if mailed, on the third
business day following the date mailed.

 

16.                                 Governing Law.  This Note is governed by the
laws of the State of California, without regard to the choice of law rules of
that State.

 

17.                                 Waiver of Jury Trial.  THE MAKER HEREBY
WAIVES ANY RIGHT TO HAVE A JURY PARTICIPATE IN RESOLVING ANY DISPUTE, WHETHER
SOUNDING IN CONTRACT, TORT OR OTHERWISE ARISING OUT OF, CONNECTED WITH, RELATED
TO OR INCIDENTAL TO THIS NOTE. INSTEAD, ANY DISPUTES RESOLVED IN COURT WILL BE
RESOLVED IN A BENCH TRIAL WITHOUT A JURY.

 

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IN WITNESS WHEREOF, the Maker has caused this Convertible Note to be duly
executed the day and year first above written.

 

 

ADVANCED CELL TECHNOLOGY,

 

INC., a Delaware corporation

 

 

 

 

 

 

By:

/s/ William M. Caldwell, IV

 

Name: William M. Caldwell, IV

 

Title: Chairman and CEO

 

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