ex10_38.htm


    

    Exhibit
10.38

    


    


    STOCK
PURCHASE AGREEMENT

     

    ONCOCYTE
CORPORATION

     

    3,000,000
Common Shares

     

    Price:
$0.667 per Share

    


    READ THIS AGREEMENT
CAREFULLY BEFORE YOU INVEST

    


    


    The
common shares, no par value (“Shares”) have not been registered under the
Securities Act of 1933, as amended, or applicable state securities laws and may
not be offered for sale, sold, transferred, pledged or hypothecated to any
person in the absence of an effective registration statement covering such
Shares (or an exemption from such registration) and an opinion of counsel
satisfactory to OncoCyte Corporation to the effect that such transfer or
exercise complies with applicable securities laws.


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    PURCHASE
AGREEMENT

    


    


    This
Agreement is entered into by George Karfunkel (“Purchaser”) and OncoCyte
Corporation, a California corporation (the “Company).

    


    1.            
 Purchase and
Sale of Shares.

    


    (a)    
       Purchaser hereby irrevocably agrees to
purchase, and the Company agrees to sell to Purchaser, Three Million (3,000,000)
common shares, no par value (“Shares”) at the price of $0.667 per
Share.

    


    (b)      
     This Agreement will become an irrevocable
obligation of Purchaser to purchase the number of Shares specified in paragraph
(a) of this Section 1, at the price of $0.667 per Share, when a copy of this
Agreement, signed by Purchaser, is countersigned by the
Company.  Purchaser shall pay the purchase price of the Shares by wire
transfer to such account of the Company as the Company may
specify.  If this Agreement is rejected or not accepted for any reason
by the Company, all sums paid by the Purchaser will be promptly returned,
without interest or deduction.

    


    (c)      
     If Purchaser purchases the 3,000,000 Shares as
provided in paragraph (a) of this Section, by paying the purchase price in full,
Purchaser shall have the right, but not the obligation, to purchase from the
Company, on or before April 15, 2010, an additional Three Million (3,000,000)
Shares at the price of $0.667 per Share (subject to pro rata adjustment in the
event of any stock split, stock dividend, combination of shares, or other
recapitalization or reclassification of the Company’s common
shares).  Purchaser may exercise the right to purchase such additional
Shares by giving the Company written notice of the exercise of such right
(“Exercise Notice”), and by paying the purchase price of such Shares in fully by
wire transfer to an account specified by the Company, which wire transfer shall
be made not later than the first business day after the Purchaser gives the
Company the Exercise Notice and the Company provides Purchaser with instructions
for wire transfer of the purchase price.  By giving the Exercise
Notice specified in this paragraph, Purchaser shall irrevocably agree to
purchase 3,000,000 Shares at the price of $0.667 per Share.

    


    2.        
     Registration
Rights.  Concurrently with the execution and delivery of this
Agreement, Purchaser and the Company are entering into a Registration Rights
Agreement pursuant to which the Company is agreeing to register the Shares for
sale under the Securities Act of 1933, as amended (the “Act”).


    
      
         


      

      
        1

        
          

        

      

      
         


      

    


    3.          
   Investment
Representations.  Purchaser represents and warrants to the
Company that:

    


    (a)        
   Purchaser has made such investigation of the Company as
Purchaser deemed appropriate for determining to acquire (and thereby make an
investment in) the Shares.  In making such investigation, Purchaser
has had access to such financial and other information concerning the Company as
Purchaser requested.  Purchaser acknowledges and understands that the
Company is a start-up venture, without a history of operations, and has received
only limited capital from its controlling shareholder BioTime,
Inc.  Purchaser acknowledges receipt of the Articles of Incorporation
and Bylaws of the Company, and copies of the minutes of the proceedings of the
Board of Directors of the Company.  Purchaser has had a reasonable
opportunity to ask questions of and receive answers from the executive officers
of the Company concerning the Company, and to obtain such additional information
concerning the Company as may have been possessed or obtainable by the Company
without unreasonable effort or expense. All such questions have been answered to
Purchaser’s satisfaction.

    


    (b)        
   Purchaser understands that the Shares are being offered and
sold without registration under the Act, or qualification under the California
Corporate Securities Law of 1968, or under the laws of any other states, in
reliance upon the exemptions from such registration and qualification
requirements for non-public offerings.  Purchaser acknowledges and
understands that the availability of the aforesaid exemptions depends in part
upon the accuracy of certain of the representations, declarations and warranties
made by Purchaser, and the information provided by Purchaser, in this
Agreement,  Purchaser is making such representations, declarations and
warranties, and is providing such information, with the intent that the same may
be relied upon by the Company and its officers and directors in determining
Purchaser’s suitability to acquire the Shares.  Purchaser understands
and acknowledges that no federal, state or other agency has reviewed or endorsed
the offering of the Shares or made any finding or determination as to the
fairness of the offering or completeness of the information provided to
Purchaser by the Company.

    


    (c)        
   Purchaser understands that the Shares may not be offered,
sold, or transferred in any manner unless subsequently registered under the Act,
or unless there is an exemption from such registration available for such offer,
sale or transfer.

    


    (d)      
     Purchaser has such knowledge and experience in
financial and business matters to enable Purchaser to utilize the information
provided or otherwise made available to Purchaser by the Company to evaluate the
merits and risks of an investment in the Shares and to make an informed
investment decision.

    


    (e)       
    Purchaser is acquiring the Shares solely for Purchaser’s
own account and for investment purposes, and not with a view to, or for sale in
connection with, any distribution of the Shares other than pursuant to an
effective registration statement under the Act or unless there is an exemption
from such registration available for such offer, sale or transfer, such as SEC
Rule 144.


    
      
         


      

      
        2

        
          

        

      

      
         


      

    


    (f)        
    Purchaser is an “accredited investor,” as such term is
defined in Regulation D promulgated under the Act.

    


    (g)       
    Information provided to Purchaser by the Company include
matters that may be considered “forward looking” statements within the meaning
of Section 27(a) of the Act and Section 21(e) of the Securities Exchange Act of
1934, as amended (the “Exchange Act”), which statements Purchaser acknowledges
and agrees are not guarantees of future performance and involve a number of
risks and uncertainties, and with respect to which the Company makes no
representations or warranties.  Purchaser understands that the level
of disclosure provided by the Company is less than that which would be provided
in a securities offering registered under the Act in reliance on the
sophistication and investment experience of Purchaser.

    


    (h)       
    Purchaser understands that this Agreement and other
information provided to Purchaser by the Company contains confidential financial
information about the Company and BioTime, Inc. that has not yet been publicly
disclosed by the Company or BioTime, and therefore may be deemed material
non-public information, (2) the Company is providing Purchaser the confidential
information solely to satisfy its disclosure obligations under the Act in
connection with the offer and sale of the Shares to Purchaser pursuant to this
Agreement, and (3) until such time as BioTime files a Form 8-K or other report
under the Exchange Act with the Securities and Exchange Commission, Purchaser
shall not (A) disclose to any other person any of the information contained in
this Agreement or otherwise provided to Purchaser concerning the Company that
has not previously been disclosed in a report filed by BioTime under the
Exchange Act, or (B) purchase or sell any common shares or warrants of BioTime
other than shares purchased through the exercise of BioTime warrants already
held by Purchaser.

    


    4.         
    Accredited Investor
Qualification.  Purchaser qualifies as an “accredited investor”
under Regulation D in the following manner.  (Please check or initial
all that apply
to verify that you qualify as an “accredited investor.”)

    


    
      	
                  _____
      (a)

            	
              Purchaser
      is a natural person whose net worth, or joint net worth with spouse, at
      the date of purchase exceeds $1,000,000 (including the value of home, home
      furnishings, and automobiles).

            


    

    


    
      	
                  _____
      (b)

            	
              Purchaser
      is a natural person whose individual
      gross income (excluding that of spouse) exceeded $200,000 in each of the
      past two calendar years, and who reasonably expects individual gross
      income exceeding $200,000 in the current calendar
  year.

            


    

    


    
      	
                  _____
      (c)

            	
              Purchaser
      is a natural person whose joint gross
      income with spouse exceeded $300,000 in each of the past two calendar
      years, and who reasonably expects joint gross income with spouse exceeding
      $300,000 in the current calendar
year.

            


    


    
      
         


      

      
        3

        
          

        

      

      
         


      

    


    
      	
                  _____
      (d)

            	
              Purchaser
      is a bank, savings and loan association, broker/dealer, insurance company,
      investment company, pension plan or other entity defined in Rule 501(a)(1)
      of Regulation D as promulgated under the Securities Act of 1933 by the
      Securities and Exchange Commission.

            


    

    


    
      	
                  _____
      (e)

            	
              Purchaser
      is a trust, and the trustee is a bank, savings and loan association, or
      other institutional investor as defined in Rule 501(a)(1) of Regulation D
      as promulgated under the Securities Act of 1933 by the Securities and
      Exchange Commission.

            


    

    


    
      	
                  _____
      (f)

            	
              Purchaser
      is a private business development company as defined in section 202(a)(22)
      of the Investment Advisers Act of
1940.

            


    

    


    
      	
                  _____
      (g)

            	
              Purchaser
      is a trust, and the grantor (i) has the power to revoke the trust at any
      time and regain title to the trust assets; and (ii) meets the requirements
      of items (a) (b), or (c) above.

            


    

    


    
      	
                  _____
      (h)

            	
              Purchaser
      is a tax-exempt organization described in Section 501(c) (3) of the
      Internal Revenue Code, or a corporation, Massachusetts or similar business
      trust, or partnership, not formed for the specific purpose of acquiring
      Shares with total assets in excess of
  $5,000,000.

            


    

    


    
      	
                  _____
      (i)

            	
              The
      Purchaser is a trust with total assets in excess of $5,000,000, not formed
      for the specific purpose of acquiring Shares, whose purchase is directed
      by a person who has such knowledge and experience in financial and
      business matters that he is capable of evaluating the merits and risks of
      an investment in the Shares.

            


    

    


    
      	
                  _____
      (j)

            	
              The
      Purchaser is an entity in which all of the equity owners meet the
      requirements of at least one of items (a) through (i)
    above.

            


    

    


    5.           
  Miscellaneous.

    


    (a)        
   This Agreement shall be governed by, interpreted, construed
and enforced in accordance with the laws of the State of California, as such
laws are applied to contracts by and among residents of California, and which
are to be performed wholly within California.

    


    (b)       
    The representations and warranties set forth herein
shall survive the sale of Shares to Purchaser.

    


    (c)        
   Neither this Agreement nor any provisions hereof shall be
modified, discharged or terminated except by an instrument in writing signed by
the party against whom any waiver, change, discharge or termination is
sought.


    
      
         


      

      
        4

        
          

        

      

      
         


      

    


    (d)           Any
notice, demand or other communication that any party hereto may be required, or
may elect, to give shall be sufficiently given if (i) deposited, postage
prepaid, in the United States mail addressed to such address as may be specified
under this Agreement, (ii) delivered personally at such address, (iii) delivered
to such address by air courier delivery service, or (iv) delivered by electronic
mail (email) to such electronic mail address as may be specified under this
Agreement.  The address for notice to the Company is: OncoCyte
Corporation, 1301 Harbor Bay Parkway, Suite 100, Alameda, California 94502;
Attention: Steven Seinberg, Chief Financial Officer; email;
sseinberg@biotimemail.com.  The address for notice of Purchaser is
shown in Section 6.  Either party may change its address for notice by
giving the other party notice of a new address in the manner provided in this
Agreement.  Any notice sent by mail shall be deemed given three days
after being deposited in the United States mail, postage paid, and addressed as
provided in this Agreement.

    


    (e)           This
Agreement may be executed through the use of separate signature pages or in any
number of counterparts, and each of such counterparts shall, for all purposes,
constitute one agreement binding on all the parties, notwithstanding that all
parties are not signatories to the same counterpart.

    


    (f)           Except
as otherwise provided herein, the Agreement shall be binding upon and inure to
the benefit of the parties and their heirs, executors, administrators,
successors, legal representatives and assigns.  If the undersigned is
more than one person, the obligation of the undersigned shall be joint and
several and the agreements, representations, warranties and acknowledgments
herein contained shall be deemed to be made by and be binding upon each such
person and his heirs, executors, administrators and successors.

    


    (g)           This
instrument contains the entire agreement of the parties, and there are no
representations, covenants or other agreements except for those stated or
referred to herein.

    


    (h)           This
Agreement is not transferable or assignable by the undersigned except as may be
provided herein.

    


    6.         
    Investor
Information.

    


    
      	
              (a)

            	
              Name:

            	 
	 
      	 
      	 
	
              (b)

            	
              Address:

            	 
	 
      	 
      	 
	
              (c)

            	
              email:

            	 


    

    


    
      
        	
                (d)

              	
                Telephone:  (______)

              	 


      

       

      
        	
                (e)

              	
                Social
      Security Number:

              	 


      

      
        	 
      	
                or
      Taxpayer Identification Number:

              	 


      

       

      
        	
                (f)

              	
                State
      of Residence or Principal Place of Business:

              	 


      

    

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    IN
WITNESS WHEREOF, the undersigned has entered into this Agreement and hereby
agrees to purchase Shares for the price stated above and upon the terms and
conditions set forth herein.  The undersigned hereby agrees to all of
the terms of the Registration Rights Agreement and agrees to be bound by the
terms and conditions thereof.

    


    


    Dated:
October 15, 2009

    


    


    
      	 
      	
              /s/ George Karfunkel

            	 
      
	 
      	
              George
      Karfunkel       

            	 
      


    


    
      
         


      

      
        6

        
          

        

      

      
         


      

    


    ACCEPTANCE BY
COMPANY

    


    


    The
Company hereby agrees to sell to the Purchaser the Shares referenced above in
reliance upon all the representations, warranties, terms and conditions
contained in this Agreement.

    


    IN
WITNESS WHEREOF, the undersigned, on behalf of the Company, has executed this
acceptance as of the date set forth below.

    


    


    
      	
              Dated:  October
      15, 2009

            	
              ONCOCYTE
      CORPORATION

            
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	 
      	
              By:
        /s/
      Robert W. Peabody

            
	 
      	 
      	 
      
	 
      	 
      	
              Title:
      Chief Operating
      Officer

            


    

     

     

    7