Blueprint





 







Exhibit 10.1


 


 



SECURITIES PURCHASE AGREEMENT

 



BY AND AMONG

 



CELLULAR BIOMEDICINE GROUP, INC.,

 



WEALTH MAP HOLDINGS LIMITED,

 



EARLS MILL LIMITED, AND

 



BOSUN S. HAU

 



JANUARY 30, 2018


 




 







 






 


 






TABLE
OF CONTENTS

 

 


	


1

	


Definitions

	


1


	


2

	


Authorization, Purchase and Sale of Common Stock

	


5


	

2.1

	


Authorization, Purchase and Sale

	


5


	

2.2

	


Closing

	


5


	


3

	


Representations and Warranties of the Company

	


5


	

3.1

	


Organization and Power

	


5


	

3.2

	


Capitalization.

	


6


	

3.3

	


Registration Rights

	


6


	

3.4

	


Authorization

	


6


	

3.5

	


Valid Issuance

	


7


	

3.6

	


No Conflict

	


7


	

3.7

	


Consents

	


7


	

3.8

	


SEC Reports; Financial Statements.

	


7


	

3.9

	


Absence of Certain Changes

	


8


	

3.10

	


Absence of Litigation

	


8


	

3.11

	


Compliance with Law

	


8


	

3.12

	


Intellectual Property

	


9


	

3.13

	


Employee Benefits

	


11


	

3.14

	


Taxes

	


11


	

3.15

	


Environmental Laws.

	


11


	

3.16

	


Title

	


12


	

3.17

	


Insurance

	


12


	

3.18

	


Nasdaq Stock Market

	


12


	

3.19

	


Sarbanes-Oxley Act

	


12


	

3.20

	


Foreign Corrupt Practices.

	


12


	

3.21

	


Regulatory.

	


13


	

3.22

	


Disclosure Controls and Procedures.

	


14


	

3.23

	


Price of Common Stock

	


14


	

3.24

	


Investment Company Act

	


14


	

3.25

	


General Solicitation; No Integration or Aggregation

	


14


	

3.26

	


Brokers and Finders

	


14


	

3.27

	


No Directed Selling Efforts

	


14


	

3.28

	


Reliance by the Purchasers

	


15


	


4

	


Representations and Warranties of Each Purchaser

	


15


	

4.1

	


Organization

	


15


	

4.2

	


Authorization

	


15


	

4.3

	


No Conflict

	


15


	

4.4

	


Consents

	


15






 



 







 





 

 


	

4.5

	


Absence of Litigation

	


16


	

4.6

	


Purchasers’ Financing

	


16


	

4.7

	


Brokers and Finders

	


16


	

4.8

	


Investment Representations, Warranties and Covenants by Non-United
States Persons

	


16


	

4.9

	


Investment Representations, Warranties and Covenants by United
States Persons.

	


18


	

4.10

	


Intent.

	


18


	

4.11

	


Investment Experience.

	


18


	

4.12

	


Securities Not Registered; Legends

	


18


	

4.13

	


Reliance by the Company

	


19


	

4.14

	


Ownership of Common Stock

	


19


	


5

	


Covenants

	


19


	

5.1

	


Further Assurances

	


19


	

5.2

	


Board Designee

	


19


	

5.3

	


Information Rights

	


22


	

5.4

	


Listing

	


23


	

5.5

	


Specific Performance

	


23


	


6

	


Conditions Precedent

	


23


	

6.1

	


Conditions to the Obligation of the Purchasers

	


23


	

6.2

	


Conditions to the Obligation of the Company

	


24


	


7

	


Termination

	


24


	

7.1

	


Conditions of Termination

	


24


	

7.2

	


Effect of Termination

	


25


	


8

	


Miscellaneous Provisions

	


25


	

8.1

	


Public Statements or Releases

	


25


	

8.2

	


Interpretation

	


25


	

8.3

	


Notices

	


25


	

8.4

	


Severability

	


26


	

8.5

	


Governing Law; Submission to Jurisdiction; Venue; Waiver of Trial
by Jury

	


26


	

8.6

	


Waiver

	


27


	

8.7

	


Expenses

	


27


	

8.8

	


Assignment

	


27


	

8.9

	


Confidential Information

	


28


	

8.10

	


Third Parties

	


28


	

8.11

	


Counterparts

	


28


	

8.12

	


Entire Agreement; Amendments

	


29


	

8.13

	


Survival

	


29


	

8.14

	


Additional Matters

	


29






 


 


 













 






 


 





 



Exhibits


 


	

Exhibit
A

	
 

	

Purchasers


	

Exhibit
B

	
 

	

Form of
Registration Rights Agreement


	

Exhibit
C

	
 

	

Form of
Legal Opinion









 








 






 


This
SECURITIES PURCHASE AGREEMENT (this “Agreement”) is dated as of January
30, 2018, by and among Cellular Biomedicine Group, Inc., a Delaware
corporation (the “Company”), Wealth Map Holdings
Limited, Earls Mill Limited, and Bosun S. Hau (each, a
“Purchaser” and
together, the “Purchasers”).

 


WHEREAS, the
Company has authorized the issuance of 1,714,324 shares of common
stock, par value $0.001 per share, of the Company (the
“Common
Stock”);

 


WHEREAS, the
Company desires to issue and sell to the Purchasers pursuant to
this Agreement, and each Purchaser, severally, desires to purchase
from the Company the aggregate number of shares of Common Stock as
is set forth opposite its name in Exhibit A hereto;

 


NOW
THEREFORE, in consideration of the mutual agreements,
representations, warranties and covenants herein contained, the
parties hereto agree as follows:

 



1.           Definitions.
As used in this Agreement, the following terms shall have the
following respective meanings:

 


“Affiliate” shall mean, with
respect to any Person, any other Person directly or indirectly
controlling, controlled by or under direct or indirect common
control with such Person, provided, that each Affiliated Entity,
the other Purchasers and each Affiliate of an Affiliated Entity or
the Purchasers shall be deemed to be an Affiliate of
Sailing.

 


“Affiliated Entity” shall mean any
investment fund or holding company formed for investments purposes
that is primarily managed, advised or serviced by the Purchasers or
by an Affiliate of the Purchasers.

 


“Agreement” has the meaning set
forth in the recitals hereof.

 


“Beneficially Own,”
“Beneficially
Owned,” or “Beneficial Ownership” shall have
the meaning set forth in Rule 13d-3 of the rules and regulations
promulgated under the Exchange Act, except that for purposes of
this Agreement the words “within sixty days” in Rule
13d-3(d)(1)(i) shall not apply, to the effect that a Person shall
be deemed to be the beneficial owner of a security if that Person
has the right to acquire beneficial ownership of such security at
any time.

 


“Benefit Plan” or
“Benefit Plans”
shall mean employee benefit plans as defined in Section 3(3) of
ERISA and all other employee benefit practices or arrangements,
including, without limitation, any such practices or arrangements
providing severance pay, sick leave, vacation pay, salary
continuation for disability, retirement benefits, deferred
compensation, bonus pay, incentive pay, stock options or other
stock-based compensation, hospitalization insurance, medical
insurance, life insurance, scholarships or tuition reimbursements,
maintained by the Company or any of its Subsidiaries or to which
the Company or any of its Subsidiaries is obligated to contribute
for employees or former employees.



 

1








 





 


 


“Board Designee” has the meaning
set forth in Section 5.2(a) hereof.

 


“Board of Directors” shall mean the
Board of Directors of the Company.

 


“CFDA” has the meaning set forth in
Section 3.21 hereof.

 


 “Closing”
has the meaning set forth in Section 2.2 hereof.

 


“Closing Date” has the meaning set
forth in Section 2.2 hereof.

 


“Code” shall mean the Internal
Revenue Code of 1986, as amended.

 


“Common Stock” has the meaning set
forth in the recitals hereof.

 


“Company” has the meaning set forth
in the recitals hereof.

 


“Company Intellectual Property” has the
meaning set forth in Section 3.12(a).

 


“Confidential Information” has the
meaning set forth in Section 8.9 hereof.

 


“Control” (including the terms
“controlling”
“controlled by”
and “under common control
with”) with respect to any Person shall mean the
possession, directly or indirectly, of the power to direct or cause
the direction of the management policies of such Person, whether
through the ownership of voting securities, by contract or
otherwise.

 


“Designee Termination Date” has the
meaning set forth in Section 5.2(d) hereof.

 


“ERISA” shall mean the Employee
Retirement Income Security Act of 1974, as amended.

 


“Environmental Laws” shall have the
meaning set forth in Section 3.15.

 


“Exchange Act” shall mean the
Securities Exchange Act of 1934, as amended, and all of the rules
and regulations promulgated thereunder.

 


“FDA” has the meaning set forth in
Section 3.21 hereof.

 


“Financial Statements” has the
meaning set forth in Section 3.8(b) hereof.

 


“GAAP” has the meaning set forth in
Section 3.8(b) hereof.

 


“Intellectual Property” has the
meaning set forth in Section 3.12(a).

 


“Material Adverse Effect” shall
mean any change, event, development, condition, occurrence or
effect that (a) is, or would reasonably be expected to be,
materially adverse to the business, financial condition, assets,
liabilities or results of operations of the Company and its
Subsidiaries, taken as a whole, or (b) materially impairs the
ability of the Company to comply, or prevents the Company from
complying, with its material obligations with respect to the
Closing or would reasonably be expected to do so; provided,
however, that none of the following will be deemed in themselves,
either alone or in combination, to constitute, and that none of the
following will be taken into account in determining whether there
has been or will be, a Material Adverse Effect under subclause (a)
of this definition:



2








 





 


 

 


  i. any
change generally affecting the economy, financial markets or
political, economic or regulatory conditions in the United States
or any other geographic region in which the Company conducts
business, to the extent the Company and its Subsidiaries are not
disproportionately affected thereby;

 


  ii.
general financial, credit or capital market conditions, including
interest rates or exchange rates, or any changes therein, to the
extent the Company and its Subsidiaries are not disproportionately
affected thereby;

 


  iii.
any change that generally affects industries in which the Company
and its Subsidiaries conduct business, to the extent the Company
and its Subsidiaries are not disproportionately affected
thereby;

 


  iv.
changes in Laws after the date hereof, to the extent the Company
and its Subsidiaries are not disproportionately affected
thereby;

 


  v.
changes in GAAP after the date of this Agreement, to the extent the
Company and its Subsidiaries are not disproportionately affected
thereby;

 


  vi. in
and of itself, any failure by the Company to meet any published or
internally prepared estimates of revenues, expenses, earnings or
other economic performance for any period ending on or after the
date of this Agreement (it being understood that the facts and
circumstances giving rise to such failure may be deemed to
constitute, and may be taken into account in determining whether
there has been, a Material Adverse Effect to the extent that such
facts and circumstances are not otherwise described in clauses
(i)-(v) of the definition).

 


“Non-U.S. Person” has the meaning
set forth in Section 4.8(c) hereof.

 


“Own” in the context of Securities
shall mean (i) the right to solely control the voting or direction
of the voting of such Securities and (2) bearing all or
substantially all economic risk of loss or appreciation (less a
fixed or floating interest rate return) in the value of, and any
profit (less a fixed or floating interest rate return) derived from
a transaction in, such Securities.

 


“Person” shall mean an individual,
partnership, corporation, limited liability company, business
trust, joint stock company, trust, unincorporated association,
joint venture or any other entity or organization.

 


“Preferred Stock” shall mean the
preferred stock, par value $0.001 per share, of the
Company.

 


“Purchaser” and “Purchasers” have the meanings set
forth in the recitals hereof.



3








 





 


 

 


“Purchaser Adverse Effect” has the
meaning set forth in Section 4.3 hereof.

 


“Registration Rights Agreement” has the meaning
set forth in Section 6.1(f) hereof.

 


“Regulation S” has the meaning set
forth in Section 3.27 hereof.

 


“Representatives” has the meaning
set forth in Section 8.9 hereof.

 


“Restricted Period” has the meaning
set forth in Section 4.8(b)(iv) hereof.

 


“Sailing” means Sailing Capital
Overseas Investments Ltd.

 


“SEC” shall mean the United States
Securities and Exchange Commission.

 


“SEC Reports” shall mean the
Company’s Annual Report on Form 10-K for the fiscal year
ended December 31, 2016 and the Company’s Annual Report on
Form 10-K/A for the fiscal year ended December 31, 2016 filed on
March 14, 2017; the Company’s Quarterly Reports on Form 10-Q
for the fiscal quarters ended March 31, 2017, June 30, 2017 and
September 30, 2017; the Company’s Proxy Statement on Schedule
14A for its 2017 Annual Meeting of Stockholders, and any Current
Reports on Form 8-K filed or furnished by the Company after
December 31, 2016 and prior to the date of hereof, together in each
case with any documents incorporated by reference therein or
exhibits thereto.

 


“Securities” has the meaning set
forth in Section 2.1.

 


“Securities Act” shall mean the
Securities Act of 1933, as amended, and all of the rules and
regulations promulgated thereunder.

 


“Subsidiary” when used with respect
to any party shall mean any corporation or other organization,
whether incorporated or unincorporated, at least a majority of the
securities or other interests of which having by their terms
ordinary voting power to elect a majority of the board of directors
or others performing similar functions with respect to such
corporation or other organization is directly or indirectly owned
or controlled by such party or by any one or more of its
Subsidiaries, or by such party and one or more of its
Subsidiaries.

 


“Tax Returns” shall mean returns,
reports, information statements and other documentation (including
any additional or supporting material) filed or maintained, or
required to be filed or maintained, in connection with the
calculation, determination, assessment or collection of any Tax and
shall include any amended returns required as a result of
examination adjustments made by the Internal Revenue Service or
other Tax authority.



4








 





 


 

 


“Tax” or “Taxes” shall mean any and all
federal, state, local, foreign and other taxes, levies, fees,
imposts, duties and charges of whatever kind (including any
interest, penalties or additions to the tax imposed in connection
therewith or with respect thereto), whether or not imposed on the
Company, including, without limitation, taxes imposed on, or
measured by, income, franchise, profits or gross receipts, and also
ad valorem, value added, sales, use, service, real or personal
property, capital stock, license, payroll, withholding, employment,
social security, workers’ compensation, unemployment
compensation, utility, severance, production, excise, stamp,
occupation, premium, windfall profits, transfer and gains taxes and
customs duties.

 


“Transaction Agreements” shall mean
this Agreement and the Registration Rights Agreement.

 


“Transfer Agent” shall mean, with
respect to the Common Stock, Corporate Stock Transfer, Inc. or such
other financial institution that provides transfer agent services
as proposed by the Company and consented to by the Purchasers,
which consent shall not be unreasonably withheld.

 


“U.S. person” has the meaning set
forth in Section 4.8(c) hereof.

 


“United States” has the meaning set
forth in Section 4.8(c) hereof.

 


“Voting Stock” shall mean
securities of any class or kind ordinarily having the power to vote
generally for the election of directors, managers or other voting
members of the governing body of the Company or any successor
thereto.

 


2.           Authorization,
Purchase and Sale of Common Stock

 


2.1           Authorization,
Purchase and Sale. The Company has
authorized the issuance of the shares of Common Stock. Subject to
and upon the terms and conditions set forth in this Agreement, at
the Closing, the Company shall issue and sell to each Purchaser,
and each Purchaser, severally, shall purchase from the Company, the
aggregate number of shares of Common Stock set forth opposite the
name of such Purchaser under the headings “Aggregate Number
of Shares of Common Stock to be Purchased” on Exhibit A hereto (the
“Securities”),
at a purchase price per share of $17.80 per share of Common Stock
for an aggregate purchase price set forth on Exhibit A.

 


2.2           Closing.
Subject to the satisfaction or waiver of the conditions set forth
in Section 6 of this Agreement, the closing of the purchase and
sale of the Securities (the “Closing”) shall take place at the
offices of Ellenoff Grossman & Schole LLP, 1345 Avenue of the
Americas, New York, New York 10105 on February 2, 2018, or (iii)
such other date as is mutually agreed upon in writing by the
Company and the Purchasers (the “Closing Date”). At the Closing,
the Securities shall be issued and registered in the name of such
Purchaser, or in such nominee name(s) as designated by such
Purchaser, representing the number of Securities to be purchased by
such Purchaser at such Closing as set forth in Exhibit A, in each case against
payment to the Company of the purchase price therefor by wire
transfer to the Company of immediately available funds to an
account to be designated by the Company. Within five business days
of the Closing Date, the Company agrees to refund to the Purchasers
any funds received in excess of the purchase price.



5








 





 


 

 


3.           Representations
and Warranties of the Company. Except as set
forth in the SEC Reports, the Company hereby represents and
warrants to each of the Purchasers as follows:

 


3.1           Organization
and Power

 


. The
Company and each of its Subsidiaries is a corporation or other
organization duly organized, validly existing and in good standing
(where relevant) under the laws of its jurisdiction of
organization, has the requisite power and authority to own, lease
and operate its properties and to carry on its business as now
conducted and is qualified to do business in each jurisdiction in
which the character of its properties or the nature of its business
requires such qualification, except where such failures of such
Subsidiaries to be so organized or existing, or of the Company or
its Subsidiaries to be in good standing or to have such power and
authority or to so qualify would not reasonably be expected to have
a Material Adverse Effect.

 


3.2           Capitalization.

 


(a)           As
of the date of this Agreement, the authorized shares of capital
stock of the Company consist of 300,000,000 shares of Common Stock
and 50,000,000 shares of Preferred Stock. As of December 31, 2017,
(i) the total number of outstanding shares of Common Stock was
15,615,558, the total number of shares of Common Stock issuable
pursuant to outstanding options and other rights to acquire Common
Stock was 2,730,590 and the total number of shares of Common Stock
maintained for future issuance under the Company’s Benefit
Plans (exclusive of outstanding options and other rights to acquire
Common Stock) was 466,563 and (ii) no shares of Preferred Stock or
options or rights to acquire Preferred Stock were outstanding.
Since December 31, 2017 through the date hereof, (i) the Company
has only issued options or other rights to acquire Common Stock in
the ordinary course of business consistent with past practice and
(ii) the only shares of capital stock issued by the Company were
pursuant to outstanding options and other rights to purchase Common
Stock. All such issued and outstanding shares of Common Stock have
been duly authorized and validly issued and are fully paid and
nonassessable, have been issued in
compliance with all federal and state securities laws, and were not
issued in violation of or subject to any preemptive, co-sale or
other rights to subscribe for or purchase securities. No
dividends have been declared or paid with respect to the shares of
Common Stock. There are no securities
or instruments containing anti-dilution provisions that will be
triggered by the issuance of the Securities.

 


(b)           As
of the date of this Agreement, except as set forth in Section
3.2(a), and except for pursuant to the Company’s Benefit
Plans, there are no existing options, warrants, calls, preemptive
(or similar) rights, subscriptions or other rights, agreements or
commitments obligating the Company to issue, transfer or sell, or
cause to be issued, transferred or sold, any capital stock of the
Company or any securities convertible into or exchangeable for such
capital stock, and there are no outstanding contractual obligations
of the Company to repurchase, redeem or otherwise acquire any of
its shares of capital stock.



6








 





 


 

 


3.3           Registration
Rights. Except as set
forth in the Transaction Agreements, the Company has not granted to
any Person the right to require the Company to register shares of
Common Stock on or after the date of this Agreement.

 


3.4           Authorization.
The Company has all requisite corporate power to enter into the
Transaction Agreements and to carry out and perform its obligations
under the terms of the Transaction Agreements. All corporate action
on the part of the Company, its officers, directors and
stockholders necessary for the authorization of the Securities, the
authorization, execution, delivery and performance of the
Transaction Agreements and the consummation of the transactions
contemplated herein has been taken. The execution, delivery and
performance of the Transaction Agreements by the Company, the
issuance of the Securities and the consummation of the other
transactions contemplated herein do not require any approval of the
Company’s stockholders. Assuming this Agreement constitutes
the legal and binding agreement of the Purchasers, this Agreement
constitutes a legal, valid and binding obligation of the Company,
enforceable against the Company in accordance with its terms,
except as such enforceability may be limited by bankruptcy,
insolvency, reorganization, moratorium and similar laws relating to
or affecting creditors generally or by general equity principles
(regardless of whether such enforceability is considered in a
proceeding in equity or at law). Upon their respective execution by
the Company and the other parties thereto and assuming that they
constitute legal and binding agreements of the other parties
thereto, the Registration Rights Agreement will constitute a legal,
valid and binding obligation of the Company, enforceable against
the Company in accordance with its terms, except as such
enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium and similar laws relating to or
affecting creditors generally or by general equity principles
(regardless of whether such enforceability is considered in a
proceeding in equity or at law.

 


3.5           Valid
Issuance. The Securities
being purchased by the Purchasers hereunder will, upon issuance
pursuant to the terms hereof, will be duly and validly issued,
fully paid and non-assessable. Subject to the accuracy of the
representations made by the Purchasers in Section 4 hereof, the
Securities will be issued to the Purchasers in compliance with
applicable exemptions from (i) the registration and prospectus
delivery requirements of the Securities Act and (ii) the
registration and qualification requirements of applicable
securities laws of the states of the United States. The Company
satisfies the registrant requirements for the use of a registration
statement on Form S-3 to register the Securities for resale by the
Purchaser under the Securities Act.



7








 





 


 


3.6           No
Conflict. The execution,
delivery and performance of the Transaction Agreements by the
Company, the issuance of the Securities and the consummation of the
other transactions contemplated hereby will not (i) violate any
provision of the Certificate of Incorporation or Bylaws of the
Company, (ii) conflict with or result in any violation of or
default (with or without notice or lapse of time, or both) under,
or give rise to a right of termination, cancellation or
acceleration of any obligation, a change of control right or to a
loss of a benefit under any agreement or instrument, credit
facility, franchise, license, judgment, order, statute, law,
ordinance, rule or regulations, applicable to the Company or its
Subsidiaries or their respective properties or assets,  or
(iii) result in a violation of any law, rule, regulation,
order, judgment, injunction, decree or other restriction of any
court or governmental authority to which the Company is subject
(including federal and state securities laws and regulations) and
the rules and regulations of any self-regulatory organization to
which the Company or its securities are subject, or by which any
property or asset of the Company is bound or
affected, except, in the case of clauses (ii) and
(iii), as would not, individually or in the aggregate, be
reasonably expected to have a Material Adverse Effect.

 


3.7           Consents.
No consent, approval, authorization, filing with or order of or
registration with, any court or governmental agency or body is
required in connection with the transactions contemplated herein,
except such as have been or will be obtained or made under the
Securities Act or the Securities Exchange Act, and such as may be
required under the securities, or blue sky, laws of any state or
foreign jurisdiction in connection with the offer and sale of the
Securities by the Company in the manner contemplated
herein.

 


3.8           SEC
Reports; Financial Statements.

 


(a)           The
Company has filed all required registration statements,
prospectuses, reports, schedules, forms, statements and other
documents required to be filed by it with the SEC since December
31, 2014. The information contained or incorporated by reference in
the SEC Reports was true and correct in all material respects as of
the respective dates of the filing thereof with the SEC (or if
amended or superseded by a filing prior to the date of this
Agreement, then on the date of such filing); and, as of such
respective dates, the SEC Reports did not contain an untrue
statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made,
not misleading. All of the SEC Reports, as of their respective
dates, complied as to form in all material respects with the
applicable requirements of the Securities Act and the Exchange Act
and the rules and regulations promulgated thereunder.

 


(b)           The
financial statements of the Company included in the SEC Reports
(collectively, the “Financial
Statements”) fairly present in all material respects
the consolidated financial position of the Company and its
Subsidiaries as of the dates indicated, and the results of its
operations and cash flows for the periods therein specified, all in
accordance with United States generally accepted accounting
principles applied on a consistent basis (“GAAP”) throughout the periods
therein specified (except as otherwise noted therein, and in the
case of quarterly financial statements except for the absence of
footnote disclosure and subject, in the case of interim periods, to
normal year-end adjustments).



8








 





 


 

 


(c)           Except
as disclosed in the SEC Reports, the Company and its Subsidiaries
have not incurred any liabilities that are of a nature that would
be required to be disclosed on a balance sheet of the Company and
its Subsidiaries or the footnotes thereto prepared in conformity
with GAAP, other than (i) liabilities incurred in the ordinary
course of business since September 30, 2017, and (ii) liabilities
that would not reasonably be expected to have a Material Adverse
Effect.

 


3.9           Absence
of Certain Changes. Since September
30, 2017, there have not been any changes, circumstances,
conditions or events which, individually or in the aggregate, have
had, or would reasonably be expected to have, a Material Adverse
Effect.

 


3.10           Absence
of Litigation. There is no
action, suit, proceeding, arbitration, claim, investigation or
inquiry pending or, to the Company’s knowledge, threatened by
or before any governmental body against the Company which,
individually or in the aggregate, would reasonably be expected to
have a Material Adverse Effect, nor are there any orders, writs,
injunctions, judgments or decrees outstanding of any court or
government agency or instrumentality and binding upon the Company
or its Subsidiaries that would reasonably be expected to have a
Material Adverse Effect. Neither the Company or
its Subsidiaries, nor any director or officer thereof, is, or
within the last ten years has been, the subject of any action
involving a claim of violation of or liability under federal or
state securities laws relating to the Company or a claim of breach
of fiduciary duty relating to the Company.

 


3.11           Compliance
with Law. Neither the
Company nor its Subsidiaries is in violation of, and the Company
and its Subsidiaries have not received any notices of violations
with respect to, any laws, statutes, ordinances, rules or
regulations of any governmental body, court or government agency or
instrumentality, except for violations which, individually or in
the aggregate, would not reasonably be expected to have a Material
Adverse Effect. The Company and each of its Subsidiaries has all
franchises, licenses, permits, certificates and other
authorizations from such federal, state or local government or
governmental agency, department or body that are currently
necessary for the operation of the business of the Company or such
Subsidiary, as applicable, as currently conducted, except where the
failure to possess currently such franchises, licenses, permits,
certificates and other authorizations is not reasonably expected to
have a Material Adverse Effect. Neither the Company nor any of its
Subsidiaries has received any written notice regarding any
revocation or material modification of any such franchise, license,
permit, certificate or other authorization.



9








 





 


 

 


3.12           Intellectual
Property

 


(a)           
“Intellectual
Property” means all (i) inventions, patents, patent
applications, reissuances, divisions, continuations,
continuations-in-part, extensions, renewals, substitutions and
reexaminations, and all patents issuing on the foregoing, (ii)
trademarks, service marks, trade dress, logos, trade names and
corporate names, and all goodwill associated therewith, (iii) works
of authorship, copyrights and moral rights, (iv) databases, data
compilations and data collections, (v) trade secrets and other
confidential information, including, without limitation, ideas,
discoveries, concepts, research and development, know-how,
formulas, compositions, processes, techniques, technical data,
designs, drawings, specifications, customer lists, supplier lists
and business and marketing plans, (vi) domain names, web addresses
and websites, (vii) computer software (including any and all
software implementations of algorithms, models and methodologies),
source code, object code, descriptions, flow-charts and other work
product used to design, plan, organize and develop any of the
foregoing, screens, user interfaces, report formats, firmware,
development tools, templates, menus, buttons and icons, and data
and documentation related to any of the foregoing and (viii)
applications, registrations and renewals in connection with any and
all of the foregoing in subclauses (i) through (viii) (all of the
foregoing collectively, “Intellectual Property”) used,
sold, licensed or otherwise exploited by the Company and its
Subsidiaries in the operation of its business as presently
conducted or reasonably expected to be conducted
(“Company Intellectual
Property”).

 


(b)           To
its knowledge, the Company (together with its Subsidiaries) solely
and exclusively owns or has obtained valid and enforceable licenses
for, free and clear of all liens or encumbrances, all Intellectual
Property necessary for its business as now conducted and currently
proposed to be conducted, and, to the knowledge of the Company, the
conduct of its current and proposed business does not infringe or
misappropriate, in any material respect, any Intellectual Property
of any third party. Neither the Company nor any of its Subsidiaries
have received any written communications of any alleged
infringement, misappropriation or breach of any Intellectual
Property rights of others. There are no outstanding options,
licenses, agreements, claims, encumbrances or shared ownership of
interests of any kind relating to anything referred to above in
this Section 3.12 that is to any extent owned by or exclusively
licensed to the Company or any of its Subsidiaries, nor is the
Company or any of its Subsidiaries bound by or a party to any
options, licenses or agreements of any kind with respect to the
patents, trademarks, service marks, trade names, domain names,
copyrights, trade secrets, licenses, information, proprietary
rights and/or processes of any other person or entity, except, in
either case, for standard end-user, object code, internal-use
software license and support/maintenance agreements for software
that is not and will not be incorporated into, or used to provide
or develop, the Company’s software, products or
services.

 


(c)           Neither
the Company nor any of its Subsidiaries is aware that any of its
employees or independent contractors are obligated under any
contract or other agreement, or subject to any judgment, decree or
order of any court or administrative agency, that would interfere
with the use of such employee’s or independent
contractor’s best efforts to promote the interest of the
Company or that would conflict with the Company’s business as
now conducted. Neither the execution nor delivery of this Agreement
nor the conduct of the Company’s business as now conducted or
as proposed to be conducted, will, to the Company’s
knowledge, conflict with or result in a breach of the terms,
conditions or provisions of, or constitute a default under, any
contract, covenant or instrument under which any such employee or
independent contractor is now obligated. The Company does not
believe it is or will be necessary to use any Intellectual Property
of any of its employees made prior to their employment by the
Company.



10








 





 


 

 


(d)           The
Company has not received any communications alleging that the
Company has violated or, by conducting its business as proposed,
would violate any of the patents, trademarks, service marks, domain
names, trade names, copyrights or trade secrets or other
proprietary rights of any other person or entity and the Company is
not aware of any potential basis for such an allegation or of any
specific reason to believe that such an allegation may be
forthcoming. There are no orders, settlement agreements or
stipulations to which the Company is a party or by which the
Company is bound that restricts the Company’s rights to use
any Intellectual Property in the operation of the business as
currently conducted.

 


(e)           To
the extent the Company uses or links to any “open
source” or “copyleft” software or is a party to
“open” or “public source” or similar
licenses, the Company is in compliance with the terms of any such
licenses and the Company is not required (and, even if it
distributed its software, would not be required) under any such
license to (a) make or permit any disclosure or to make available
any source code for its (or any of its licensors’)
proprietary software or (b) distribute or make available any of the
Company’s proprietary software or Intellectual Property (or
to permit any such distribution or availability).

 


(f)           Except
as would not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect, there is no pending or,
to the Company’s knowledge, threatened action, suit,
proceeding or claim by others: (A) challenging the Company’s
rights in or to any Company Intellectual Property, and the Company
is unaware of any facts which would form a reasonable basis for any
such action, suit, proceeding or claim; or (B) challenging the
validity, enforceability or scope of any Company Intellectual
Property, and the Company is unaware of any facts which would form
a reasonable basis for any such action, suit, proceeding or
claim.

 


(g)           Except
as would not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect, the Company has
complied with the terms of each agreement pursuant to which
Intellectual Property has been licensed to the Company, and all
such agreements are in full force and effect.

 


(h)           To
the Company’s knowledge, there are no material defects in any
of the patents or patent applications included in the Company
Intellectual Property. In particular, to the Company’s
knowledge, all priority claims of the Company Intellectual Property
are valid, and all claims in such patents and pending patent
applications are entitled to the priority claims made. To the
Company’s knowledge, no granted patents or pending patent
applications of the Company Intellectual Property violate the Paris
Convention Treaty. To the knowledge of the Company, all patents and
pending patent applications of the Company Intellectual Property
claim priority to all applicable prior filed and/or co-pending
patent applications.

 


(i)           Except
as would not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect, the Company has taken
reasonable and customary actions to protect its rights in, and to
prevent the unauthorized use and disclosure of, material trade
secrets and confidential business information (including
confidential ideas, research and development information, know-how,
formulas, compositions, technical data, designs, drawings,
specifications, research records, records of inventions, test
information, financial, marketing and business data, supplier lists
and information, and business plans) owned by the Company, and, to
the knowledge of the Company, there has been no unauthorized use or
disclosure of such material trade secrets and confidential business
information.



11








 





 


 

 


3.13           Employee
Benefits. Except as would
not be reasonably likely to result in a Material Adverse Effect,
each Benefit Plan has been established and administered in
accordance with its terms and in compliance with the applicable
provisions of ERISA, the Code and other applicable laws, rules and
regulations. The Company and its Subsidiaries are in compliance
with all federal, state, local and foreign requirements regarding
employment, except for any failures to comply that are not
reasonably likely, individually or in the aggregate, to have a
Material Adverse Effect. As of the date hereof, there is no
material labor dispute, strike or work stoppage against the Company
or any of its Subsidiaries pending or, to the knowledge of the
Company, threatened which may interfere with the business
activities of the Company or any of its Subsidiaries, except where
such dispute, strike or work stoppage is not reasonably likely,
individually or in the aggregate, to have a Material Adverse
Effect.

 


3.14           Taxes.
The Company and each of its Subsidiaries have filed all Tax Returns
required to have been filed (or extensions have been duly obtained)
and have paid all Taxes required to have been paid by it, except
for those which are being contested in good faith and except where
failure to file such Tax Returns or pay such Taxes would not,
individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect.

 


3.15           Environmental
Laws.

 


The
Company (i) is in compliance with any and all applicable
foreign, federal, state and local laws and regulations relating to
the protection of human health and safety, the environment or
hazardous or toxic substances or wastes, pollutants or contaminants
(“Environmental
Laws”), (ii) has received all permits, licenses
or other approvals required under applicable Environmental Laws to
conduct its business and (iii) is in compliance with all terms
and conditions of any such permit, license or approval, except
where such noncompliance with Environmental Laws, failure to
receive required permits, licenses or other approvals or failure to
comply with the terms and conditions of such permits, licenses or
approvals would not, individually or in the aggregate, be
reasonably expected to have a Material Adverse Effect. There are no
costs or liabilities associated with Environmental Laws, including,
without limitation, any capital or operating expenditures required
for clean-up, closure of properties or compliance with
Environmental Laws or any permit, license or approval, any related
constraints on operating activities and any potential liabilities
to third parties, that would, individually or in the aggregate, be
reasonably expected to have a Material Adverse Effect.

 


3.16           Title. The
Company has good and marketable title to all personal property
owned by it that is material to the business of the Company, free
and clear of all liens, encumbrances and defects except as
described in the SEC Reports or such as do not materially affect
the value of such property and do not interfere with the use made
and proposed to be made of such property by the Company. Any real
property and buildings held under lease by the Company is held
under valid, subsisting and enforceable leases with such exceptions
as are not material and do not interfere with the use made and
proposed to be made of such property and buildings by the Company.
The Company does not own any real property.



12








 





 


 

 


3.17           Insurance.
The Company maintains insurance underwritten by insurers of
recognized financial responsibility, of the types and in the
amounts that the Company reasonably believes is adequate for
businesses and covering all risks customarily insured against, with
such deductibles as are customary for companies in the same or
similar business, all of which insurance is in full force and
effect.

 


3.18           Nasdaq
Stock Market. Shares of the
Common Stock are registered pursuant to Section 12(b) of the
Exchange Act and are listed on the Nasdaq Global Market, and the
Company has no action pending to terminate the registration of the
Common Stock under the Exchange Act or delist the Common Stock from
Nasdaq Global Market, nor has the Company received any notification
that the SEC or the Nasdaq Stock Market is currently contemplating
terminating such registration or listing.

 


3.19           Sarbanes-Oxley
Act

 


The
Company is in compliance in all material respects with applicable
requirements of the Sarbanes-Oxley Act of 2002 and applicable rules
and regulations promulgated by the Commission
thereunder.

 


3.20           Foreign
Corrupt Practices.

 


None of
the Company, its Subsidiaries or, to the knowledge of the Company,
any director, officer, agent, employee or other Person acting on
behalf of the Company or any of its Subsidiaries has, in the course
of its actions for, or on behalf of, the Company or any of its
Subsidiaries (a) used any corporate funds for any unlawful
contribution, gift, entertainment or other unlawful expenses
relating to political activity; (b) made any direct or
indirect unlawful payment to any foreign or domestic government
official or employee from corporate funds; (c) violated or is
in violation of any provision of the U.S. Foreign Corrupt Practices
Act of 1977, as amended; or (d) made any unlawful bribe,
rebate, payoff, influence payment, kickback or other unlawful
payment to any foreign or domestic government official or
employee.

 


3.21           Regulatory.

 


(a)           To
the best of the Company’s knowledge, the Company has operated
its business and currently is in compliance in all material
respects with all applicable rules, regulations and policies of the
United States Food and Drug Administration (“FDA”), the China Food and Drug
Administration (the “CFDA”), and any other applicable
foreign regulatory organization.

 


(b)           No
investigational new drug (“IND”) application filed by or on
behalf of the Company with the CFDA or FDA has been terminated by
the CFDA or FDA, and none of the CFDA, FDA or any other applicable
foreign regulatory agency has recommended, commenced, or, to the
knowledge of the Company, threatened to initiate, any action to
place a clinical hold order on, or otherwise delay or suspend,
proposed or ongoing clinical investigations conducted or proposed
to be conducted by or on behalf of the Company.



13








 





 


 

 


(c)           To
the best of the Company’s knowledge, all the operations of
the Company and all the manufacturing facilities and operations of
the Company’s suppliers of products and product candidates
and the components thereof manufactured in or imported into the
United States are in compliance with applicable FDA regulations,
including current Good Manufacturing Practices, and meet sanitation
standards set by the Federal Food, Drug and Cosmetic Act of 1938,
as amended. To the best of the Company’s knowledge, all the
operations of the Company and all the manufacturing facilities and
operations of the Company’s suppliers of products and product
candidates and the components thereof manufactured in or imported
into China are in compliance with applicable CFDA regulations,
including current Good Manufacturing Practices, and all the
operations of the Company and all the manufacturing facilities and
operations of the Company’s suppliers of products and product
candidates manufactured outside, or exported from, the United
States or China are in compliance with applicable foreign
regulatory requirements and standards, except to the extent that
the failure to be in compliance with such regulations and standards
would not, individually or in the aggregate, be reasonably expected
to have a Material Adverse Effect.

 


(d)           No
Person involved in development of any data included in the
Company’s regulatory filings has been convicted of (or
investigated for) any crime or engaged in conduct reasonably
expected to result in exclusion under 42 U.S.C. Section 1302a-7 or
any similar state law or regulation or debarred by the FDA under
Article 306 or the Federal Food Drug and Cosmetic Act, 21 U.S.C.
Section 335a(a) or (b).

 


(e)           The
Company has not received any FDA Form 483 Notice of Observation,
FDA Notices of Adverse Findings, “warning letters” or
other similar governmental authority notice of inspectional
observations or legal deficiencies from the FDA, CFDA or any other
governmental authority asserting a violation of applicable law with
respect to Company’s product candidates. There has not been a
recall or market withdrawal of any of Company’s product
candidates by or on behalf of Company. The Company has complied
with all adverse event reporting requirements applicable to the
Company’s product candidates.

 


(f)           The
Company has not made any false statements on applications, reports
and submissions to the FDA, CFDA or other government authority with
respect to the Company’s product candidates. Company is not
the subject of any pending investigation by any governmental
authority with respect to the Company’s product
candidates.

 


3.22           Disclosure
Controls and Procedures.

 


The
Company has established and maintains disclosure controls and
procedures (as defined in Exchange Act Rules 13a-15(e) and
15d-15(e)) that are effective in all material respects to ensure
that material information relating to the Company, including its
subsidiaries, is made known to its chief executive officer and
chief financial officer by others within those entities. The
Company’s certifying officers have evaluated the
effectiveness of the Company’s controls and procedures as of
December 31, 2016. The Company presented in its Annual Report
on Form 10-K for the fiscal year ended December 31, 2016 the
conclusions of the certifying officers about the effectiveness of
the disclosure controls and procedures based on their evaluations
as of December 31, 2016. Since December 31, 2016, there
have been no significant changes in the Company’s internal
controls (as such term is defined in Item 307(b) of Regulation
S-K under the Exchange Act) or, to the Company’s knowledge,
in other factors that could significantly affect the
Company’s internal controls.



14








 





 


 

 


3.23           Price
of Common Stock

 


. The
Company has not taken, nor will it take, directly or indirectly,
any action designed to stabilize or manipulate the price of the
Common Stock.

 


3.24           Investment
Company Act

 


. The
Company is not, and immediately after receipt of payment for the
Common Stock will not be, an “investment company”
within the meaning of the Investment Company Act of 1940, as
amended.

 


3.25           General
Solicitation; No Integration or Aggregation

 


.
Neither the Company nor any other person or entity authorized by
the Company to act on its behalf has engaged in a general
solicitation or general advertising (within the meaning of
Regulation D of the Securities Act) of investors with respect to
offers or sales of Common Stock. The Company has not, directly or
indirectly, sold, offered for sale, solicited offers to buy or
otherwise negotiated in respect of, any security (as defined in the
Securities Act) which, to its knowledge, is or will be (i)
integrated with the Securities sold pursuant to this Agreement for
purposes of the Securities Act or (ii) aggregated
with prior offerings by the Company for the purposes of the rules
and regulations of the NASDAQ Global Market.

 


3.26           Brokers
and
Finders

 


.
Neither the Company nor any other Person authorized by the Company
to act on its behalf has retained, utilized or been represented by
any broker or finder in connection with the transactions
contemplated by this Agreement whose fees the Purchasers would be
required to pay.

 


3.27           No
Directed Selling Efforts. None of the
Company or any of its Affiliates engaged in any directed selling
efforts within the meaning of Regulation S of the Securities Act
(“Regulation S”)
in connection with the transactions contemplated by this Agreement,
and all such persons have complied with the offering restrictions
requirement of Regulation S.

 


3.28           Reliance
by the Purchasers. The Company
acknowledges that each of the Purchasers will rely upon the truth
and accuracy of, and the Company’s compliance with, the
representations, warranties, agreements, acknowledgements and
understandings of the Company set forth herein.



15








 





 


 

 


4.           Representations
and Warranties of Each Purchaser. Each Purchaser,
severally for itself and not jointly with the other Purchasers,
represents and warrants to the Company as follows:

 


4.1           Organization.
Such Purchaser is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its organization and
has the requisite power and authority to own, lease and operate its
properties and to carry on its business as now
conducted.

 


4.2           Authorization.
Such Purchaser has all requisite corporate or similar power to
enter into this Agreement and the other Transaction Agreements to
which it will be a party and to carry out and perform its
obligations hereunder and thereunder. All corporate, member or
partnership action on the part of such Purchaser or its
stockholders, members or partners necessary for the authorization,
execution, delivery and performance of this Agreement and the other
Transaction Agreements to which it will be a party and the
consummation of the other transactions contemplated herein has been
taken. Assuming this Agreement constitutes the legal and binding
agreement of the Company, this Agreement constitutes a legal, valid
and binding obligation of such Purchaser, enforceable against such
Purchaser in accordance with its terms, except as such
enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium and similar laws relating to or
affecting creditors generally or by general equity principles
(regardless of whether such enforceability is considered in a
proceeding in equity or at law). Upon their respective execution by
such Purchaser and the other parties thereto and assuming that they
constitute legal and binding agreements of the Company, the
Registration Rights Agreement will constitute a legal, valid and
binding obligation of such Purchaser, enforceable against such
Purchaser in accordance with its terms, except as such
enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium and similar laws relating to or
affecting creditors generally or by general equity principles
(regardless of whether such enforceability is considered in a
proceeding in equity or at law).

 


4.3           No
Conflict. The execution,
delivery and performance of the Transaction Agreements by such
Purchaser, the issuance of the Securities in accordance with their
terms and the consummation of the other transactions contemplated
hereby will not conflict with or result in any violation of or
default by such Purchaser (with or without notice or lapse of time,
or both) under, or give rise to a right of termination,
cancellation or acceleration of any obligation, a change of control
right or to a loss of a material benefit under (i) any provision of
the organizational documents of such Purchaser or (ii) any
agreement or instrument, credit facility, franchise, license,
judgment, order, statute, law, ordinance, rule or regulations,
applicable to such Purchaser or its respective properties or
assets, except, in the case of clause (ii), as would not,
individually or in the aggregate, be reasonably expected to
materially delay or hinder the ability of such Purchaser to perform
its obligations under the Transaction Agreements (a
“Purchaser Adverse
Effect”).



16








 





 


 

 


4.4           Consents.
All consents, approvals, orders and authorizations required on the
part of such Purchaser in connection with the execution, delivery
or performance of this Agreement, the issuance of the Securities
and the consummation of the other transactions contemplated herein
have been obtained or made, other than such consents, approvals,
orders and authorizations the failure of which to make or obtain,
individually or in the aggregate, would not reasonably be expected
to have a Purchaser Adverse Effect.

 


4.5           Absence
of Litigation. There is no
action, suit, proceeding, investigation or inquiry pending or, to
such Purchaser’s knowledge, threatened by or before any
governmental body against such Purchaser which, individually or in
the aggregate, would reasonably be expected to have a Purchaser
Adverse Effect, nor are there any orders, writs, injunctions,
judgments or decrees outstanding of any court or government agency
or instrumentality and binding upon such Purchaser that would
reasonably be expected to have a Purchaser Adverse
Effect.

 


4.6           Purchasers’
Financing. At the Closing,
such Purchaser will have all funds necessary to pay to the Company
the purchase price for the Securities being purchased by such
Purchaser pursuant to this Agreement in immediately available
funds.

 


4.7           Brokers
and Finders. Such Purchaser
has not retained, utilized or been represented by any broker or
finder in connection with the transactions contemplated by this
Agreement whose fees the Company would be required to pay (other
than pursuant to the reimbursement of expenses provisions of
Section 8.7 hereof).

 


4.8           Investment
Representations, Warranties and Covenants by Non-United States
Persons

 


Each
Purchaser who is a Non-U.S. person (as that term is defined in
Section 4.8(c)) hereby represents and warrants to the Company
as follows:

 


(a)           This
Agreement is made by the Company with the Purchaser, who is a
Non-U.S. person, in reliance upon such Non-U.S. person’s
representations, warranties and covenants made in this
Section 4.8.

 


(b)           Such
Non-U.S. person has been advised and acknowledges
that:

 


(i)                 the
Securities have not been, and when issued, will not be registered
under the Securities Act, the securities laws of any state of the
United States or the securities laws of any other
country;



17








 





 


 

 


(ii)                 in
issuing and selling the Securities to such Non-U.S. person pursuant
hereto, the Company is relying upon the “safe harbor”
provided by Regulation S and/or in Section 4(a)(2) of the
Securities Act;

 


(iii)                 it
is a condition to the availability of the Regulation S “safe
harbor” that the Securities not be offered or sold in the
United States or to a U.S. person until the expiration of a
one-year “distribution compliance period” (or a
six-month “distribution compliance period,” if the
issuer is a “reporting issuer,” as defined in
Regulation S) following the Closing Date; and

 


(iv)                 notwithstanding
the foregoing, prior to the expiration of the one-year
“distribution compliance period” (or six-month
“distribution compliance period,” if the issuer is a
“reporting issuer,” as defined in Regulation S)
after the Closing (the “Restricted Period”), the
Securities may be offered and sold by the holder thereof only if
such offer and sale is made in compliance with the terms of this
Agreement and either: (A) if the offer or sale is within the
United States or to or for the account of a U.S. person (as such
terms are defined in Regulation S), the securities are offered and
sold pursuant to an effective registration statement or pursuant to
Rule 144 under the Securities Act or pursuant to an exemption from
the registration requirements of the Securities Act; or
(B) the offer and sale is outside the United States and to
other than a U.S. person.

 


(c)           As
used herein, the term “United
States” means the United States of America, its
territories and possessions, any State of the United States, and
the District of Columbia, and the term “U.S. person” means any “U.S.
person” as defined in Rule 902(k)(2). As used herein, the
term “Non-U.S.
person” means any person who is not a U.S. person or
is deemed not to be a U.S. person under Rule 902(k)(2) of the
Securities Act.

 


(d)           Such
Non-U.S. person agrees that with respect to the Securities, until
the expiration of the Restricted Period:

 


(i)                 such
Non-U.S. person, its agents or its representatives have not and
will not solicit offers to buy, offer for sale or sell any of the
Securities, or any beneficial interest therein in the United States
or to or for the account of a U.S. person; and

 


(ii)                 notwithstanding
the foregoing, the Securities may be offered and sold by the holder
thereof only if such offer and sale is made in compliance with the
terms of this Agreement and either: (A) if the offer or sale
is within the United States or to or for the account of a U.S.
person, the securities are offered and sold pursuant to an
effective registration statement or pursuant to Rule 144 under the
Securities Act or pursuant to an exemption from the registration
requirements of the Securities Act; or (B) the offer and sale
is outside the United States and to other than a U.S. person;
and

 


(iii)                 such
Non-U.S. person shall not engage in hedging transactions with
regard to the Securities unless in compliance with the Securities
Act.

 


The
foregoing restrictions are binding upon subsequent transferees of
the Securities, except for transferees pursuant to an effective
registration statement. Such Non-U.S. person agrees that after the
Restricted Period, the Securities may be offered or sold within the
United States or to or for the account of a U.S. person only
pursuant to applicable securities laws.



18








 





 


 

 


(e)           Such
Non-U.S. person has not engaged, nor is it aware that any party has
engaged, and such Non-U.S. person will not engage or cause any
third party to engage, in any “directed selling
efforts” (as such term is defined in Regulation S) in the
United States with respect to the Securities.

 


(f)           Such
Non-U.S. person: (i) is domiciled and has its principal place
of business outside the United States; (ii) certifies it is
not a U.S. person and is not acquiring the Securities for the
account or benefit of any U.S. person; and (iii) at the time
of the Closing Date, the Non-U.S. person or persons acting on
Non-U.S. person’s behalf in connection therewith will be
located outside the United States.

 


(g)           At
the time of offering to such Non-U.S. person and communication of
such Non-U.S. person’s order to purchase the Securities and
at the time of such Non-U.S. Person’s execution of this
Agreement, the Non-U.S. person or persons acting on Non-U.S.
person’s behalf in connection therewith were located outside
the United States.

 


(h)           Such
Non-U.S. person is not a “distributor” (as defined in
Regulation S) or a “dealer” (as defined in the
Securities Act).

 


(i)           Such
Non-U.S. person acknowledges that the Company shall make a notation
in its stock book regarding the restrictions on transfer set forth
in this Section 4.8 and shall transfer such shares on the
books of the Company only to the extent consistent therewith. In
particular, such Non-U.S. person acknowledges that the Company
shall refuse to register any transfer of the Securities not made in
accordance with the provisions of Regulation S, pursuant to
registration under the Securities Act or pursuant to an available
exemption from registration.

 


4.9           Investment
Representations, Warranties and Covenants by United States
Persons. Each Purchaser, other than Purchasers who are a
Non-U.S. person (as that term is defined in Section 4.8(c)), hereby
represents and warrants to the Company that, it (i) is an
“accredited investor” as that term is defined in Rule
501(a) under Regulation D promulgated pursuant to the Securities
Act; or (ii) has such knowledge and experience in financial and
business matters as to be able to protect its own interests in
connection with an investment in the Shares. Each Purchaser further
represents and warrants that (x) it is capable of evaluating the
merits and risk of such investment, and (y) that it has not been
organized for the purpose of acquiring the Securities

 


4.10           Intent.  
Each Purchaser is purchasing the Securities solely for investment
purposes, for the Purchaser’s own account, and not with a
view towards the distribution or dissemination thereof. Each
Purchaser has no present arrangement to sell the Securities to or
through any person or entity. Each Purchaser understands that the
Securities must be held indefinitely unless such Securities are
resold pursuant to a registration statement under the Securities
Act or an exemption from registration is available.



19








 





 


 


4.11           Investment
Experience. Each Purchaser, or such Purchaser’s
professional advisors, have such knowledge and experience in
finance, securities, taxation, investments and other business
matters as to evaluate investments of the kind described in this
Agreement. By reason of the business and financial experience of
such Purchaser or his or her professional advisors (who are not
affiliated with or compensated in any way by the Company or any of
its affiliates or selling agents), such Purchaser can protect his
or her own interests in connection with the transactions described
in this Agreement. Each Purchaser is able to afford the loss of
his, her or its entire investment in the Securities.

 


4.12           Securities
Not Registered;
Legends

 


. Such
Purchaser understands that the Securities have not been registered
under the Securities Act, by reason of their issuance by the
Company in a transaction exempt from the registration requirements
of the Securities Act, and that the Securities must continue to be
held by such Purchaser unless a subsequent disposition thereof is
registered under the Securities Act or is exempt from such
registration and in each case in accordance with any applicable
securities laws of any state of the United States. Such Purchaser
understands that the exemptions from registration afforded by Rule
144 (the provisions of which are known to it) promulgated under the
Securities Act depend on the satisfaction of various conditions
including, but not limited to, the time and manner of sale, the
holding period and on requirements relating to the Company which
are outside of the Purchaser’s control and which the Company
is under no obligation and may not be able to satisfy, and that, if
applicable, Rule 144 may afford the basis for sales only in limited
amounts.

 


Each
Purchaser, severally and not jointly, understands that the
Securities may bear one or more legends in substantially the
following form and substance:

 


Investment
pursuant to Regulation D:

 


“THESE
SECURITIES ARE BEING OFFERED TO INVESTORS WITHOUT REGISTRATION WITH
THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION UNDER THE
SECURITIES ACT IN RELIANCE UPON REGULATION D PROMULGATED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (“THE SECURITIES
ACT”). TRANSFER OF THESE SECURITIES IS PROHIBITED, EXCEPT
PURSUANT TO REGISTRATION UNDER THE SECURITIES ACT, OR PURSUANT TO
AVAILABLE EXEMPTION FROM REGISTRATION. HEDGING TRANSACTIONS MAY NOT
BE CONDUCTED UNLESS IN COMPLIANCE WITH THE SECURITIES
ACT.”

 


 



20








 






Investment pursuant to Regulation
S:

 


“THESE
SECURITIES ARE BEING OFFERED TO INVESTORS WHO ARE NOT U.S. PERSONS
(AS DEFINED IN REGULATION S UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (“THE SECURITIES ACT”)) AND WITHOUT
REGISTRATION WITH THE UNITED STATES SECURITIES AND EXCHANGE
COMMISSION UNDER THE SECURITIES ACT IN RELIANCE UPON REGULATION S
PROMULGATED UNDER THE SECURITIES ACT. TRANSFER OF THESE SECURITIES
IS PROHIBITED, EXCEPT IN ACCORDANCE WITH THE PROVISIONS OF
REGULATION S PROMULGATED UNDER THE SECURITIES ACT, PURSUANT TO
REGISTRATION UNDER THE SECURITIES ACT, OR PURSUANT TO AVAILABLE
EXEMPTION FROM REGISTRATION. HEDGING TRANSACTIONS MAY NOT BE
CONDUCTED UNLESS IN COMPLIANCE WITH THE SECURITIES
ACT.”

 

 


In
addition, stock certificates representing the Securities may
contain a legend regarding affiliate status of the
Purchasers.

 


4.13           Reliance
by the Company. Such Purchaser
acknowledges that the Company will rely upon the truth and accuracy
of, and the Purchaser’s compliance with, the representations,
warranties, agreements, acknowledgements and understandings of such
Purchaser set forth herein.

 


4.14           Ownership
of Common Stock. The Purchasers do
not, and during the period beginning on the date of this Agreement
and ending immediately prior to the Closing will not, own any
shares of Common Stock.

 


5.           Covenants

 


5.1           Further
Assurances. Each party agrees
to cooperate with each other and their respective officers,
employees, attorneys, accountants and other agents, and, generally,
do such other reasonable acts and things in good faith as may be
necessary to effectuate the intents and purposes of this Agreement,
subject to the terms and conditions hereof and compliance with
applicable law, including taking reasonable action to facilitate
the filing of any document or the taking of reasonable action to
assist the other parties hereto in complying with the terms
hereof.

 


5.2           Board
Designee


 



21








 





 


(a)           Sailing
shall have the right to nominate pursuant to the terms and subject
to the conditions of this Section 5.2 one nominee to the Board of
Directors (the “Board
Designee”). Such nominee shall (i) be qualified and
suitable to serve as a member of the Board of Directors under all
applicable corporate governance policies or guidelines of the
Company and the Board of Directors and applicable legal, regulatory
and stock market requirements, (ii) meet the independence
requirements with respect to the Company of Section 5605(a)(2) of
the Rules of the Nasdaq Stock Market or any other stock exchange on
which the Common Stock may be listed in the future, and (iii) be
acceptable to the Board of Directors (including the Nominating and
Corporate Governance Committee of the Board of Directors) in its
good faith discretion. The Board of Directors and the appropriate
committees of the Board of Directors shall conduct the
consideration of the qualifications, suitability and independence
of a Board Designee, and make any determinations with respect
thereto, in a manner consistent with considerations and
determinations in respect of other members of the Board of
Directors. Sailing will take all necessary action to cause any
nominee for Board Designee to make himself or herself reasonably
available for interviews, to consent to such reference and
background checks or other investigations and to provide such
information (including information necessary to determine the
nominee’s independence status under various requirements and
institutional investor guidelines as well as information necessary
to determine any disclosure obligations of the Company) as the
Board of Directors or its Nominating and Corporate Governance
Committee may reasonably request; provided, that in each such case, all
interviews, investigations and information is generally required to
be delivered to the Company by the outside directors of the
Company. As of the date hereof, Sailing has designated Bosun S. Hau
as a nominee for Board Designee and therefore, no action by the
Company and no adjustment to the Board of Directors will be
required as of the Closing. Provided that the Board Designee then
meets the requirements set forth in the second sentence of this
Section 5.2(a) and the Purchasers, together with their Affiliated
Entities, collectively, then Own at least 171,432 shares of Common
Stock (as adjusted for any stock dividends stock splits,
recapitalization, combinations, consolidations or the like), the
Company shall nominate the Board Designee for re-election as a
director at the Company’s 2018 annual meeting of stockholders
as part of the slate proposed by the Company that is included in
the proxy statement (or consent solicitation or similar document)
of the Company relating to the election of the Board of Directors
and will use its best efforts to cause the election of the Board
Designee to the Board of Directors (including providing the same
level of support as is provided for other nominees of the Company
to the Board of Directors).

 


(b)           The
Board Designee shall be subject to the policies and requirements of
the Company and its Board of Directors, including the corporate
governance guidelines of the Board of Directors and the
Company’s Code of Ethics, in a manner consistent with the
application of such policies and requirements to other members of
the Board of Directors and in a manner that does not discriminate
against Sailing or its Affiliates. The Company shall compensate the
Board Designee, reimburse their expenses, indemnify them and
provide the Board Designee with director and officer insurance to
the same extent it compensates, reimburses, indemnifies and
provides insurance for the outside members of the Board of
Directors pursuant to its organizational documents, applicable law
or otherwise

 


(c)           The
rights of Sailing pursuant to this Section 5.2 shall be specific to
Sailing and shall be non-transferable.



22








 





 


 

 


(d)           If,
for any reason, the Board Designee is not a member of the Board of
Directors, so long as the Purchasers, together with their
Affiliated Entities, collectively, Own at least 171,432 shares of
Common Stock (as adjusted for any stock dividends stock splits,
recapitalization, combinations, consolidations or the like),
Sailing shall have the right to appoint an observer to receive
notice of, and the right to participate as an observer in, meetings
of the Board of Directors and to receive the same information that
is provided to members of the Board of Directors in connection with
such meetings, except that the observer may be excluded from access
to any material or meeting or portion thereof if the Board of
Directors determines in good faith, upon advice of counsel, that
such exclusion is reasonably necessary to preserve the
attorney-client privilege, to protect highly confidential
proprietary information, or for other similar reasons.  Upon
reasonable notice and at a scheduled meeting of the Board or such
other time, if any, as the Board of Directors may determine in its
sole discretion, such representative may address the Board of
Directors with respect to Sailing’s concerns regarding
significant business issues facing the Company.   The
observer agrees that any information provided to or learned by it
in connection with its rights under this provision shall be treated
as confidential information by the observer and shall not be
disclosed except to others with a need to know and who are also
subject to confidentiality provisions or upon the written approval
of the Company or as may be required by law or regulatory or legal
process.

 


(e)           All
obligations of the Company pursuant to this Section 5.2 shall
terminate upon the first to occur of: (i) such time as the
Purchasers, together with their Affiliated Entities, collectively,
do not Own at least 171,432 shares of Common Stock (as adjusted for
any stock dividends stock splits, recapitalization, combinations,
consolidations or the like), (ii) the Company sells all or
substantially all of its assets, (iii) any Person or
“group” (as such term is used in Section 13 of the
Exchange Act), directly or indirectly, obtains Beneficial Ownership
of 50% or more of the total outstanding voting power of the Voting
Stock, (iv) the Company participates in any merger, consolidation
or similar transaction unless immediately following the
consummation of such transaction the stockholders of the Company
immediately prior to the consummation of such transaction continue
to hold (in substantially the same proportion as their ownership of
the Company’s voting stock immediately prior to the
transaction) more than 50% of all of the outstanding common stock
or other securities entitled to vote for the election of directors
of the surviving or resulting entity in such transaction, (v)
Sailing irrevocably waives and terminates all of its rights under
this Section 5.2, (vi) the Board Designee is removed from the Board
of Directors for cause by the stockholders of the Company or (vii)
the Company delivers written notice that a Purchaser has breached
the terms of this Agreement in any material respect and such
Purchaser does not cure any such breach within 10 days of such
notice, provided that no
cure period shall apply if such breach is of a nature which cannot
be cured. The date of termination pursuant to this clause (e) of
the obligations of the Company pursuant to this Section 5.2 is
sometimes referred to herein as the “Designee Termination
Date”).

 


5.3           Information
Rights

 


 (a)           Regardless
of whether the Company is required to do pursuant to the Exchange
Act, the Company shall furnish to Sailing any annual reports,
quarterly reports and other periodic reports required pursuant to
Section 13 or 15(d) of the Exchange Act within fifteen (15) days of
when such reports would be required pursuant to Section 13 or 15(d)
of the Exchange Act (provided, that any such reports shall
be deemed to have been provided when such reports are publicly
available via the SEC’s EDGAR system or any successor to the
EDGAR system.



23








 





 


 


(b)           The
rights of Sailing pursuant to this Section 5.3 shall be specific to
Sailing and shall be non-transferable.

 


(c)           All
obligations of the Company pursuant to this Section 5.3 shall
terminate upon the first to occur of: (i) such time as the
Purchasers, together with their Affiliated Entities, collectively,
do not Own at least 171,432 shares of Common Stock (as adjusted for
any stock dividends stock splits, recapitalization, combinations,
consolidations or the like), (ii) the Company sells all or
substantially all of its assets, (iii) any Person or
“group” (as such term is used in Section 13 of the
Exchange Act), directly or indirectly, obtains Beneficial Ownership
of 50% or more of the total outstanding voting power of the Voting
Stock, (iv) the Company participates in any merger, consolidation
or similar transaction unless immediately following the
consummation of such transaction the stockholders of the Company
immediately prior to the consummation of such transaction continue
to hold (in substantially the same proportion as their ownership of
the Company’s voting stock immediately prior to the
transaction) more than 50% of all of the outstanding common stock
or other securities entitled to vote for the election of directors
of the surviving or resulting entity in such transaction, or (v)
Sailing irrevocably waives and terminates all of its rights under
this Section 5.3.

 


5.4           Listing.
The Company shall use its best efforts to maintain the listing of
its Common Stock on the Nasdaq Global Market.

 


5.5           Specific
Performance. The Purchasers
and the Company agree that irreparable damage would occur and that
the Company and the Purchaser, as applicable, would not have any
adequate remedy at law in the event that any of the provisions of
Section 5.1, Section 5.2, Section 5.3 and Section 5.4 were not
performed in accordance with their specific terms or were otherwise
breached. Accordingly, the Purchasers and the Company agree that
the Company and the Purchasers, as applicable, shall without the
necessity of proving the inadequacy of money damages or posting a
bond be entitled to an injunction or injunctions to prevent
breaches of such Sections and to enforce specifically the terms,
provisions and covenants contained therein, this being in addition
to any other remedy to which they are entitled at law or in
equity.

 


6.           Conditions
Precedent.

 


6.1           Conditions
to the Obligation of the Purchasers. The several
obligations of each Purchaser to consummate the transactions to be
consummated at the Closing, and to purchase and pay for the
Securities being purchased by it at the Closing pursuant to this
Agreement, are subject to the satisfaction or waiver of the
following conditions precedent:



24








 





 


 

 


(a)           The
representations and warranties of the Company contained herein
shall be true and correct on and as of the Closing Date with the
same force and effect as though made on and as of the Closing Date
(it being understood and agreed by each Purchaser that for purposes
of this Section 6.1(a), in the case of any representation and
warranty of the Company contained herein (i) which is not
hereinabove qualified by application thereto of a materiality
standard, such representation and warranty need be true and correct
only in all material respects or (ii) which is made as of a
specific date, such representation and warranty need be true and
correct only as of such specific date).

 


(b)           The
Company shall have performed in all material respects all
obligations and conditions herein required to be performed or
observed by the Company on or prior to the Closing
Date.

 


(c)           Each
Purchaser shall have received a certificate, dated the Closing
Date, signed by the Chief Executive Officer and Chief Financial
Officer of the Company, certifying on behalf of the Company that
the conditions specified in the foregoing Sections 6.1(a) and (b)
have been fulfilled.

 


(d)           The
purchase of and payment for the Securities by each Purchaser shall
not be prohibited or enjoined by any law or governmental or court
order or regulation.

 


(e)           The
Company shall have furnished all required materials to the Transfer
Agent to reflect the issuance of the Securities at the
Closing.

 


(f)           The
Company shall have executed and delivered the Registration Rights
Agreement in the form attached hereto as Exhibit B (the
“Registration
Rights Agreement”) to
the Purchasers.

 


(g)           The
Purchasers shall have received from counsel to the Company, an
opinion substantially in the form attached as Exhibit C hereto.

 


(h)           The
Securities shall have been approved for listing on the Nasdaq
Global Market, subject to official notice of
issuance

 


(i)           Bosun
S. Hau shall have been elected to the Board of Directors and the
Company shall have entered into an indemnification agreement with
Mr. Hau in a form satisfactory to Sailing and Mr.
Hau.

 


 


6.2           Conditions
to the Obligation of the Company. The obligation of
the Company to consummate the transactions to be consummated at the
Closing, and to issue and sell to each Purchaser the Common Stock
to be purchased by it at the Closing pursuant to this Agreement, is
subject to the satisfaction or waiver of the following conditions
precedent:



25








 





 


 


(a)           The
representations and warranties contained herein of each Purchaser
shall be true and correct on and as of the Closing Date, with the
same force and effect as though made on and as of the Closing Date
(it being understood and agreed by the Company that, in the case of
any representation and warranty of a Purchaser contained herein
which is not hereinabove qualified by application thereto of a
materiality standard, such representation and warranty need be true
and correct only in all material respects).

 


(b)           Each
Purchaser shall have performed in all material respects all
obligations and conditions herein required to be performed or
observed by such Purchaser on or prior to the Closing
Date.

 


(c)           The
purchase of and payment for the Securities by each Purchaser shall
not be prohibited or enjoined by any law or governmental or court
order or regulation.

 


(d)           Each
Purchaser shall have executed and delivered the Registration Rights
Agreement to the Company.

 


(e)           The
Company shall have received payment, by wire transfer of
immediately available funds, in the full amount of the purchase
price for the number of Securities being purchased by each
Purchaser at the Closing as set forth in 
Exhibit A.

 


7.           Termination.

 


7.1           Conditions
of Termination. Notwithstanding
anything to the contrary contained herein, this Agreement may be
terminated at any time before the Closing (a) by mutual consent of
the Company and the Purchasers, or (b) by either the Company or the
Purchasers if the Closing shall not have occurred on or prior to
1:00 p.m., Eastern time, on February 5, 2018.

 


7.2           Effect
of Termination. In the event of
any termination pursuant to Section 7.1 hereof, this Agreement
shall become null and void and have no effect, with no liability on
the part of the Company or the Purchasers, or their directors,
officers, agents or stockholders, with respect to this Agreement,
except for liability for any willful breach of this
Agreement.

 


8.           Miscellaneous
Provisions

 


8.1           Public
Statements or Releases. Neither the
Company nor any Purchaser shall make any public announcement with
respect to the existence or terms of this Agreement or the
transactions provided for herein without the prior approval of the
other parties, which shall not be unreasonably withheld or delayed,
other than a statement consistent with public announcements that
were previously made by a party hereto in accordance with this
Section 8.1. Notwithstanding the foregoing, nothing in this Section
8.1 shall prevent any party from making any public announcement it
considers necessary in order to satisfy its obligations under the
law or under the rules of any national securities
exchange.



26








 





 


 

 


8.2           Interpretation.
The words “hereof,” “herein” and
“hereunder” and words of similar import when used in
this Agreement will refer to this Agreement as a whole and not to
any particular provision of this Agreement, and section and
subsection references are to this Agreement unless otherwise
specified. The headings in this Agreement are included for
convenience of reference only and will not limit or otherwise
affect the meaning or interpretation of this Agreement. Whenever
the words “include,” “includes” or
“including” are used in this Agreement, they will be
deemed to be followed by the words “without
limitation.” The phrases “the date of this
Agreement,” “the date hereof” and terms of
similar import, unless the context otherwise requires, will be
deemed to refer to the date set forth in the first paragraph of
this Agreement. The meanings given to terms defined herein will be
equally applicable to both the singular and plural forms of such
terms. All matters to be agreed to by any party hereto must be
agreed to in writing by such party unless otherwise indicated
herein. References to agreements, policies, standards, guidelines
or instruments, or to statutes or regulations, are to such
agreements, policies, standards, guidelines or instruments, or
statutes or regulations, as amended or supplemented from time to
time (or to successors thereto).

 


8.3           Notices.
Any notices or other communications required or permitted to be
given hereunder shall be in writing and shall be deemed to be given
when delivered in person or by private courier with receipt, if
telefaxed when verbal or email confirmation from the recipient is
received, or three (3) days after being deposited in the United
States mail, first-class, registered or certified, return receipt
requested, with postage paid and:

 


(a)           If
to the Company, addressed as follows:

 


Cellular
Biomedicine Group, Inc.


19925
Stevens Creek Blvd., Suite 100


Cupertino, CA
95014


Attention: Andy
Chan, Secretary and Senior Vice President


E-mail:
andy.chan@cellbiomedgroup.com

 


with a
copy to:


Ellenoff Grossman
& Schole LLP


1345
Avenue of the Americas


New
York, New York 10105


Attention: Sarah
Williams


Facsimile: (212)
370-7889


E-mail:
swilliams@egsllp.com


 



27








 





 


(b)           If
to any Purchaser, addressed as follows:


 


Sailing
Capital Overseas Investments Management Ltd


190
Elgin Avenue, George Town, Grand Cayman KY1-9005


Cayman
Islands


Attention: Bosun S.
Hau


Managing Director /
Partner


E-mail:
bosunhau@sailing-capital.com

 


with
copies to:

 


Wilson
Sonsini Goodrich & Rosati, Professional
Corporation


12235
El Camino Real


San
Diego, California 92130


Attention: Dan
Koeppen


Facsimile:
858-350-2399


E-mail:
dkoeppen@wsgr.com

 


Any
Person may change the address to which notices and communications
to it are to be addressed by notification as provided for
herein.

 


8.4           Severability.
If any part or provision of this Agreement is held unenforceable or
in conflict with the applicable laws or regulations of any
jurisdiction, the invalid or unenforceable part or provisions shall
be replaced with a provision which accomplishes, to the extent
possible, the original business purpose of such part or provision
in a valid and enforceable manner, and the remainder of this
Agreement shall remain binding upon the parties
hereto.

 


8.5           Governing
Law; Submission to Jurisdiction; Venue; Waiver of Trial by
Jury.

 

 


(a)           This
Agreement shall be governed by, and construed in accordance with,
the laws of the State of New York without regard to choice of laws
or conflicts of laws provisions thereof that would require the
application of the laws of any other jurisdiction, except to the
extent that mandatory principles of Delaware law may
apply.

 


(b)           The
Company and each of the Purchasers hereby irrevocably and
unconditionally:

 


(i)                 submits
for itself and its property in any legal action or proceeding
relating solely to this Agreement or the transactions contemplated
hereby, to the general jurisdiction of the any New York State or
United States Federal court sitting in the City of New York,
Borough of Manhattan in the State of New York;



28








 





 


 

 


(ii)                 consents
that any such action or proceeding may be brought in such courts,
and waives any objection that it may now or hereafter have to the
venue of any such action or proceeding in any such court or that
such action or proceeding was brought in an inconvenient court and
agrees not to plead or claim the same to the extent permitted by
applicable law;

 


(iii)                 agrees
that service of process in any such action or proceeding may be
effected by mailing a copy thereof by registered or certified mail
(or any substantially similar form of mail), postage prepaid, to
the party, as the case may be, at its address set forth in Section
9.3 or at such other address of which the other party shall have
been notified pursuant thereto;

 


(iv)                 agrees
that nothing herein shall affect the right to effect service of
process in any other manner permitted by law or shall limit the
right to sue in any other jurisdiction for recognition and
enforcement of any judgment or if jurisdiction in the courts
referenced in the foregoing clause (i) are not available despite
the intentions of the parties hereto;

 


(v)                 agrees
that final judgment in any such suit, action or proceeding brought
in such a court may be enforced in the courts of any jurisdiction
to which such party is subject by a suit upon such judgment,
provided that service of process is effected upon such party in the
manner specified herein or as otherwise permitted by
law;

 


(vi)                 agrees
that to the extent that such party has or hereafter may acquire any
immunity from jurisdiction of any court or from any legal process
with respect to itself or its property, such party hereby
irrevocably waives such immunity in respect of its obligations
under this Agreement, to the extent permitted by law;
and

 


(vii)                 irrevocably
and unconditionally waives trial by jury in any legal action or
proceeding in relation to this Agreement.

 


8.6           Waiver.
No waiver of any term, provision or condition of this Agreement,
whether by conduct or otherwise, in any one or more instances,
shall be deemed to be, or be construed as, a further or continuing
waiver of any such term, provision or condition or as a waiver of
any other term, provision or condition of this
Agreement.

 


8.7           Expenses.
Each party shall pay its own out-of-pocket fees and expenses,
including the fees and expenses of attorneys, accountants and
consultants employed by such party, incurred in connection with the
proposed investment in the Securities, the negotiation of the
Transaction Agreements and the consummation of the transactions
contemplated thereby.



29








 





 


 

 


8.8           Assignment.
None of the parties may assign its rights or obligations under this
Agreement or designate another person (i) to perform all or part of
its obligations under this Agreement or (ii) to have all or part of
its rights and benefits under this Agreement, in each case without
the prior written consent of (x) the Company and (y) the
Purchasers. In the event of any assignment in accordance with the
terms of this Agreement, the assignee shall specifically assume and
be bound by the provisions of the Agreement by executing a writing
agreeing to be bound by and subject to the provisions of this
Agreement and shall deliver an executed counterpart signature page
to this Agreement and, notwithstanding such assumption or agreement
to be bound hereby by an assignee, no such assignment shall relieve
any party assigning any interest hereunder from its obligations or
liability pursuant to this Agreement.

 


8.9           Confidential
Information. The Purchasers
acknowledge that from time to time, Purchasers may be given access
to non-public, proprietary information with respect to the Company
(“Confidential
Information”). For purposes hereof, for any Purchaser,
Confidential Information does not include, however, (i) information
which is or becomes generally available to the public in accordance
with law other than as a result of a disclosure by the Purchaser or
its directors, managing members, officers, employees, agents, legal
counsel, financial advisors, accounting representatives or
potential funding sources (“Representatives”) or its
Affiliates, subsidiaries or franchisees in violation of this
Section 8.9 or any other confidentiality agreement to which the
Company is a party or beneficiary, (ii) is, or becomes, available
to the Purchasers on a non-confidential basis from a source other
than the Company or any of its Affiliates or any of its
Representatives, provided,
that such source was not known to the Purchasers (after reasonable
investigation) to be bound by a confidentiality agreement with, or
any other contractual, fiduciary or other legal obligation of
confidentiality to, us or any of our subsidiaries or any of the
Company’s representatives, (iii) is already in the
Purchasers’ possession (other than information furnished by
or on behalf of the Company or directors, officers, employees,
representatives and/or agents of the Company), or (iv) is
independently developed by the Purchasers without violating any of
the confidentiality terms herein. Each Purchaser agrees (i) except
as required by law or regulatory or legal process, to keep all
Confidential Information confidential and not to disclose or reveal
any such Confidential Information to any person other than those of
its Representatives who need to know the Confidential Information
for the purpose of evaluating, monitoring or taking any other
action with respect to the investment by the Purchaser in the
Common Stock and to cause those Representatives to observe the
terms of this Section 8.9 and (ii) not to use Confidential
Information for any purpose other than in connection with
evaluating, monitoring or taking any other action with respect to
the investment by the Purchaser in the Common Stock.

 


8.10           Third
Parties. Nothing in this
Agreement, express or implied, is intended to confer on any Person
other than the parties to this Agreement any rights, remedies,
claims, benefits, obligations or liabilities under or by reason of
this Agreement, and no Person that is not a party to this Agreement
(including, without limitation, any partner, member, shareholder,
director, officer, employee or other beneficial owner of any party
to this Agreement, in its own capacity as such or in bringing a
derivative action on behalf of a party to this Agreement) shall
have any standing as a third party beneficiary with respect to this
Agreement or the transactions contemplated hereby.



30








 





 


 

 


8.11           Counterparts.
This Agreement may be signed in any number of counterparts, each of
which shall be an original, but all of which together shall
constitute one instrument.

 


8.12           Entire
Agreement; Amendments. This Agreement
and the other Transaction Agreements constitute the entire
agreement between the parties hereto respecting the subject matter
hereof and supersedes all prior agreements, negotiations,
understandings, representations and statements respecting the
subject matter hereof, whether written or oral. No modification,
alteration, or change in any of the terms of this Agreement shall
be valid or binding upon the parties hereto unless made in writing
and duly executed by the Company and the Purchasers or, in the case
of Section 5.2, Sailing. The Company, on the one hand, and the
Purchasers or Sailing, as the case may be, on the other hand, may
by an instrument signed in writing by such parties waive the
performance, compliance or satisfaction by the Purchasers or the
Company, respectively, with any term or provision hereof or any
condition hereto to be performed, complied with or satisfied by the
Purchasers or the Company, respectively.

 


8.13           Survival.
The representations and warranties contained in this Agreement
shall survive the Closing and the delivery of the Securities for a
period of three (3) years after the date hereof; provided, however,
that notwithstanding the foregoing in this Section 8.13, the
representations and warranties contained in Sections 3.1, 3.2, 3.4
and 3.5 of this Agreement shall not terminate at the Closing and
shall survive thereafter for the applicable statute of
limitations.

 


8.14           Additional
Matters. For the avoidance
of doubt, the parties acknowledge and confirm that the terms and
conditions of the Securities were determined as a result of
arm’s-length negotiations.

 



[Remainder of Page Intentionally Left Blank.]

 


 



31








 





 


IN
WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.

 







	

 

	COMPANY:	

 


	

 

	
 

	

 


	

 

	
CELLULAR
BIOMEDICINE GROUP, INC.

	

 


	

 

	

 

	

 

	

 


	
 

	
By:  

	
/s/
Bizuo
(Tony) Liu

	

 


	

 

	Name:	
Bizuo
(Tony) Liu	

 


	

 

	Title:	Chief Executive
Officer	

 







 

  









 



[Signature Page to Common Stock Purchase Agreement]








 





 


IN
WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.

 


PURCHASER:

 


WEALTH
MAP HOLDINGS LIMITED, A BVI COMPANY


 

 



By: /s/ James Xiao Dong
Liu






 



Name: James Xiao Dong
Liu





 



Title: Director  







 

 


Address: c/o Unit
2006-08


20/F
Harbour Centre, 25 Harbour Road


Wan
Chai, Hong Kong


 


Email:
jamesliu@sailing-capital.com

 

 


 



 



[Signature Page to Common Stock Purchase Agreement]








 





 


IN
WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.

 


PURCHASER:

 


EARLS
MILL LIMITED, A BVI COMPANY


 

 



By: /s/ James Xiao Dong
Liu






 



Name: James Xiao Dong
Liu






 



Title: Director               








 

 


Address: c/o Unit
2006-08


20/F
Harbour Centre, 25 Harbour Road


Wan
Chai, Hong Kong


 


Email:
jamesliu@sailing-capital.com

 


 



 



[Signature Page to Common Stock Purchase Agreement]








 





 


IN
WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.

 


PURCHASER:


 

 



/s/Bosun S.
Hau 







Bosun
S. Hau

 


 


 



 



[Signature Page to Common Stock Purchase Agreement]








 










 



EXHIBIT A

 



PURCHASERS

 


	


Purchaser Name and Address

	


Purchase Price per Share

	


Aggregate Number of Shares of



Common Stock to be Purchased

	


Aggregate Purchase Price


	
 

	
 

	
 

	
 


	

Wealth Map
Holdings Limited, a BVI Company


c/o
Unit 2006-08


20/F
Harbour Centre, 25 Harbour Road


Wan
Chai, Hong Kong


Email:
jamesliu@sailing-capital.com

	

$17.80

	

1,404,494

	

$24,999,993.20


	
 

	
 

	
 

	
 


	

Earls Mill
Limited, a BVI Company


c/o
Unit 2006-08


20/F
Harbour Centre, 25 Harbour Road


Wan
Chai, Hong Kong


Email:
jamesliu@sailing-capital.com

	

$17.80

	

308,426

	

$5,489,982.80


	
 

	
 

	
 

	
 


	

Bosun S.
Hau


c/o
Unit 2006-08


20/F
Harbour Centre, 25 Harbour Road


Wan
Chai, Hong Kong


Email:
bosunhau@sailing-capital.com

	

$17.80

	

1,404

	

$24,991.20


	
 

	
 

	
 

	
 


	


TOTAL:

	
 

	


1,714,324

	


$30,514,967.20







 




 








 










 



EXHIBIT B

 



FORM OF REGISTRATION RIGHTS AGREEMENT






 


 


 


 


 



 

1







 






 



REGISTRATION RIGHTS AGREEMENT

 


This
Registration Rights Agreement (this “Agreement”) is
made and entered into as of January 30, 2018, by and among Cellular
Biomedicine Group, Inc., a Delaware corporation (the
“Company”),
Wealth Map Holdings Limited, Earls Mill Limited, and Bosun S. Hau
(each an “Investor” and
together the “Investors”).

 


WHEREAS, the
Investors have, pursuant to that certain Securities Purchase
Agreement, dated as of January 30, 2018, between the Company and
the Investors (the “Purchase
Agreement”), agreed to purchase the Securities,
subject to the terms and conditions set forth therein;
and

 


WHEREAS, it is a condition to the closing (the
“Closing”)
of the transactions contemplated by the Purchase Agreement that the
Company and the Investors enter into this Agreement at or prior to
the Closing in order to grant the Investors certain registration
rights as set forth herein.

 


NOW,
THEREFORE, IN CONSIDERATION of the mutual covenants contained in
this Agreement, and for other good and valuable consideration, the
receipt and adequacy of which are hereby acknowledged, the Company
and the Investors agree as follows:

 


9.           Definitions.
Capitalized terms used and not otherwise defined herein that are
defined in the Purchase Agreement shall have the meanings given
such terms in the Purchase Agreement.  As used in this
Agreement, the following terms shall have the respective meanings
set forth in this Section 1:

 


“Affiliate” of
any Person shall mean any other Person directly or indirectly
controlling or controlled by or under direct or indirect common
control with such Person. For
purposes of this definition, “control” when used with
respect to any Person has the meaning specified in Rule 12b-2 under
the Exchange Act; and the terms “controlling” and
“controlled” have meanings correlative to the
foregoing.

 


“Available”
means, with respect to a Registration
Statement, that such Registration Statement does not contain
an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they
were made, not misleading, such that such Registration Statement
will be available for the resale of Registrable
Securities.

 


“Black-Out
Period” means any period of time that the Company
prohibits the directors and officers of the Company from trading
securities of the Company (i) pursuant to the Insider Trading
Policy, or (ii) because the Board of Directors determines in good
faith that there is a valid business purpose for such suspension of
trading, which valid business purpose shall include without
limitation plans for a registered public offering, an acquisition
or other proposed or pending corporate developments and similar
events because of material developments known to the Company and
not yet disclosed to the public.

 


“Business Day”
means a day that is a Monday, Tuesday, Wednesday, Thursday or
Friday and is not a day on which banking institutions in New York,
New York generally are authorized or obligated by law, regulation
or executive order to close.

 




 

2








 






 

 


“Commission”
means the Securities and Exchange Commission or any other federal
agency then administering the Securities Act or Exchange
Act.

 


“Common Stock”
means the common stock, $0.001 par value per share, of the
Company.

 


“Effective
Date” means the time and date that the Registration
Statement filed pursuant to Section 2(a) is first declared
effective by the Commission or otherwise becomes
effective.

 


“Effectiveness
Date” means:

 

 


(a)        with
respect to the initial Registration Statement required to be filed
to cover the resale by the Holders of the Registrable Securities,
the 90th
day following the Closing; and

 

 


(b)        with
respect to any additional Registration Statements that may be
required pursuant to Section 2(a) hereof, the earlier of: (x) the
120th day
following the date on which the Company first knows, or reasonably
should have known, that such additional Registration Statement is
required under such Section and (y) the fifth Trading Day following
the date on which the Company is notified by the Commission that
such additional Registration Statement will not be reviewed or is
no longer subject to further review and comments.

 


“Effectiveness
Period” has the meaning set forth in Section
2(a).

 


“Electing
Holders” means one or more Investors that hold no less
than a majority of the Registrable Securities then held by the
Investors.

 


“Exchange Act”
means the Securities Exchange Act of 1934, as amended.

 


“Filing Date”
means:

 

 


(a)        with
respect to the initial Registration Statement required to be filed
to cover the resale by the Holders of the Registrable Securities,
the 30 th day following
the Closing; and

 

 


(b)        with
respect to any additional Registration Statements that may be
required pursuant to Section 2(a) hereof, the 30th day following the
date on which the Company first knows, or reasonably should have
known, that such additional Registration Statement is required
under such Section.

 


“Freely
Tradable” means, with respect to any security, a
security that is eligible to be sold by the Holder thereof without
any volume or manner of sale restrictions under the Securities Act
pursuant to Rule 144.

 


“Holder” or
“Holders” means
(i) the Investors and (ii) permitted assignees of the Investors who
are assigned rights hereunder, in each case to the extent that they
continue to hold Registrable Securities.

 




 

3








 






 

 


“Indemnified
Party” has the meaning set forth in Section
5(c).

 


“Indemnifying
Party” has the meaning set forth in Section
5(c).

 


“Insider Trading
Policy” means the Company’s Insider Trading
Policy as adopted and posted on the Company’s
website.

 


“Losses” has
the meaning set forth in Section 5(a).

 


“Person” means
an individual or corporation, partnership, trust, incorporated or
unincorporated association, joint venture, limited liability
company, joint stock company, government (or an agency or
subdivision thereof) or other entity of any kind.

 


“Plan of
Distribution” means the plan of distribution in
substantially the form attached hereto as Annex A.

 


“Proceeding”
means a pending action, claim, suit, or proceeding (including,
without limitation, an investigation or partial proceeding, such as
a deposition) or investigation known to the Company to be
threatened.

 


“Prospectus”
means the prospectus included in a Registration Statement
(including, without limitation, a prospectus that includes any
information previously omitted from a prospectus filed as part of
an effective registration statement in reliance upon Rule 430A
promulgated under the Securities Act), as amended or supplemented
by any prospectus supplement, with respect to the terms of the
offering of any portion of the Registrable Securities covered by a
Registration Statement, and all other amendments and supplements to
the Prospectus, including post-effective amendments, and all
material incorporated by reference or deemed to be incorporated by
reference in such Prospectus.

 


“Questionnaire”
has the meaning set forth in Section 3(k).

 


“Registrable
Securities” means (i) the
Securities and (ii) any securities issued as (or issuable upon the
conversion or exercise of any warrant, right or other security that
is issued as) a dividend, stock split, recapitalization or other
distribution with respect to, or in exchange for, or in replacement
of, the securities referenced in clause (i) (without giving effect
to any election by the Company therein), above or this clause
(ii); provided,
however,
that the term “Registrable
Securities” shall exclude
in all cases any securities (1) sold or exchanged by a Person
pursuant to an effective registration statement under the Act or in
compliance with Rule 144, (2) that are Freely Tradable (it being
understood that for purposes of determining eligibility for resale
under clause (2) of this proviso, no securities held by any Holder
shall be considered Freely Tradable to the extent such Holder
reasonably determines that it is an Affiliate of the Company) or
(3) that shall have ceased to be outstanding.

 


“Registration
Default” has the meaning set forth in Section
2(b).

 


“Registration
Statement” means a registration statement in the form
required to register the resale of the Registrable Securities, and
including the Prospectus, amendments and supplements to each such
registration statement or Prospectus, including pre- and
post-effective amendments, all exhibits thereto, and all material
incorporated by reference or deemed to be incorporated by reference
in such registration statement.

 




 

4








 






 

 


“Rule 144”
means Rule 144 promulgated by the Commission pursuant to the
Securities Act, as such Rule may be amended from time to time, or
any similar rule or regulation hereafter adopted by the Commission
having substantially the same effect as such Rule.

 


“Rule 405”
means Rule 405 promulgated by the Commission pursuant to the
Securities Act, as such Rule may be amended from time to time, or
any similar rule or regulation hereafter adopted by the Commission
having substantially the same effect as such Rule.

 


“Rule 415”
means Rule 415 promulgated by the Commission pursuant to the
Securities Act, as such Rule may be amended from time to time, or
any similar rule or regulation hereafter adopted by the Commission
having substantially the same effect as such Rule.

 


“Rule 424”
means Rule 424 promulgated by the Commission pursuant to the
Securities Act, as such Rule may be amended from time to time, or
any similar rule or regulation hereafter adopted by the Commission
having substantially the same effect as such Rule.

 


“Rule 433”
means Rule 433 promulgated by the Commission pursuant to the
Securities Act, as such Rule may be amended from time to time, or
any similar rule or regulation hereafter adopted by the Commission
having substantially the same effect as such Rule.

 


“Securities”
has the meaning set forth in the Purchase Agreement.

 


“Securities
Act” means the Securities Act of 1933, as
amended.

 


“Suspension
Notice” has the meaning set forth in Section
3(j)(B).

 


“Trading Day”
means a day during which trading in the Common Stock generally
occurs.

 


“Trading
Market” means the principal national securities
exchange on which the Common Stock is listed.

 


“Use Notice”
has the meaning set forth in Section 3(j).

 




 

5








 






 

 


10.           Registration.

 


10.1           On
or prior to each Filing Date, the Company will use commercially
reasonable efforts to prepare and file with the Commission a
Registration Statement covering the resale of all Registrable
Securities not already covered by an existing and effective
Registration Statement for an offering to be made on a continuous
basis pursuant to Rule 415. The Registration Statement (i) shall be
on Form S-3 (except if the Company is not then eligible to register
for resale the Registrable Securities on Form S-3, in which
case such registration shall be on another appropriate form for
such purpose) and (ii) shall contain (except if otherwise requested
by the Electing Holders or required pursuant to written comments
received from the Commission upon a review of such Registration
Statement) the Plan of Distribution. The Company will use its
commercially reasonable efforts to cause the Registration Statement
to be declared effective or otherwise to become effective under the
Securities Act as soon as possible but, in any event, no later than
the Effectiveness Date, and will use their commercially reasonable
efforts to keep the Registration Statement (or a replacement
Registration Statement) continuously effective under the Securities
Act until the registration rights under this Agreement terminate in
accordance with Section 2(d) (the “Effectiveness
Period”). In addition, the Company will, promptly and
from time to time, use commercially reasonable efforts to file such
additional Registration Statements to cover resales of any
Registrable Securities which are not registered for resale pursuant
to a pre-existing Registration Statement no later than the Filing
Date with respect thereto, and will use its commercially reasonable
efforts to cause such Registration Statement to be declared
effective or otherwise to become effective under the Securities Act
as soon as practicable after the applicable Filing Date but, in any
event, no later than the applicable Effectiveness Date, and will
use their commercially reasonable efforts to keep the Registration
Statement continuously effective under the Securities Act at all
times during the Effectiveness Period; provided that, the Company will
not be obligated to update the Registration Statement and no sales
may made under the applicable Registration Statement during any
Black-Out Period of which the Holders have received
notice.

 


10.2           If:
(i) any Registration Statement is not filed on or prior to its
Filing Date, (ii) a Registration Statement is not declared
effective by the Commission or does not otherwise become effective
on or prior to its required Effectiveness Date or (iii) after its
Effective Date, such Registration Statement ceases for any reason
to be effective as to all Registrable Securities to which it is
required to cover at any time prior to the expiration of the
Effectiveness Period (in each case, except as specifically
permitted herein with respect to any applicable Black-Out Period;
provided that, the
aggregate number of days of any such Black-Out Period shall not
exceed 30 days in any 180-day period or 60 days in any 365-day
period) (any such failure or breach being referred to as a
“Registration
Default”). Upon the occurrence and during the
continuance of a Registration Default, the Company will make pro
rata payments to each Investor, as liquidated damages and not as a
penalty, in an amount equal to 1% of the aggregate amount invested
by such Investor pursuant to the Purchase Agreement for each 30-day
period or pro rata for any portion thereof during which such
Registration Default is continuing. Such payments shall constitute
the Investors’ exclusive monetary remedy for such events, but
shall not affect the right of the Investors to seek injunctive
relief. Such payments shall be made to each Investor in cash no
later than three (3) Business Days after the end of each 30-day
period.

 


10.3           The
Company shall not, from the date hereof until the Effective Date of
the initial Registration Statement, prepare and file with the
Commission a registration statement relating to an offering of any
of its securities for its own account or the account of others
under the Securities Act.

 


10.4           The
registration rights granted under this Section 2 shall
automatically terminate upon the earlier of (i) such time as
there are no outstanding Registrable Securities and (ii) the
five-year anniversary of the Closing.

 




 

6








 






 

 


11.           Registration
Procedures.

 


The
procedures to be followed by the Company and each selling Holder,
and the respective rights and obligations of the Company and such
Holders, with respect to the preparation, filing and effectiveness
of a Registration Statement, and the distribution of Registrable
Securities pursuant thereto, are as follows:

 


11.1           The
Company will, at least five (5) Trading Days prior to the filing of
a Registration Statement or any related Prospectus or any amendment
or supplement thereto (other than any amendment or supplement made
through the incorporation by reference of ordinary course Exchange
Act filings), (i) furnish to the Holders copies of all such
documents proposed to be filed, which documents will be subject to
the reasonable review of such Holders and (ii) use its commercially
reasonable efforts to address in each such document when so filed
with the Commission such comments as the Holders reasonably shall
propose.

 


11.2           The
Company will use commercially reasonable efforts to (i) 
prepare and file with the Commission such amendments, including
post-effective amendments, and supplements to each Registration
Statement and the Prospectus used in connection therewith as may be
necessary under applicable law with respect to the disposition of
all Registrable Securities covered by such Registration Statement
continuously effective as to the applicable Registrable Securities
for its Effectiveness Period and prepare and file with the
Commission such additional Registration Statements in order to
register for resale under the Securities Act all of the Registrable
Securities; (ii) cause the related Prospectus to be amended or
supplemented by any required Prospectus supplement, and as so
supplemented or amended to be filed pursuant to Rule 424; and (iii)
respond as promptly as reasonably possible to any comments received
from the Commission with respect to each Registration Statement or
any amendment thereto and, as promptly as reasonably possible
provide the Holders true and complete copies of all correspondence
from and to the Commission relating to such Registration Statement
that pertains to the Holders as selling securityholders but not any
comments that would result in the disclosure to the Holders of
material and non-public information concerning the
Company.

 


11.3           The
Company will comply in all material respects with the provisions of
the Securities Act and the Exchange Act with respect to the
Registration Statements and the disposition of all Registrable
Securities covered by each Registration Statement.

 


11.4           The
Company will notify the Holders as promptly as reasonably possible
(i) of the issuance by the Commission of any stop order suspending
the effectiveness of a Registration Statement covering any or all
of the Registrable Securities or the initiation of any Proceedings
for that purpose; and (ii) of the receipt by the Company of any
notification with respect to the suspension of the qualification or
exemption from qualification of any of the Registrable Securities
for sale in any jurisdiction, or the initiation or threatening of
any Proceeding for such purpose.

 


11.5           The
Company will use commercially reasonable efforts to obtain the
withdrawal of any order suspending the effectiveness of a
Registration Statement, at the earliest practicable moment, or if
any such order or suspension is made effective during any Black-Out
Period, at the earliest practicable moment after the Black-Out
Period is over.

 




 

7








 






 

 


11.6           During
the Effectiveness Period, the Company will furnish to each Holder,
without charge, at least one conformed copy of each Registration
Statement and each amendment thereto and all exhibits to the extent
requested by such Person (including those incorporated by
reference) promptly after the filing of such documents with the
Commission; provided, that the Company will
not have any obligation to provide any document pursuant to this
clause that is available on the EDGAR system.

 


11.7           The
Company will promptly deliver to each Holder, without charge, as
many copies of each Prospectus or Prospectuses (other than any
amendment or supplement made through the incorporation by reference
of ordinary course Exchange Act filings) as such Persons may
reasonably request during the Effectiveness Period. The Company
consents to the use of such Prospectus and each amendment or
supplement thereto by each of the selling Holders in connection
with the offering and sale of the Registrable Securities covered by
such Prospectus and any amendment or supplement thereto in
accordance with this Agreement.

 


11.8           The
Company will, prior to any public offering of Registrable
Securities, use commercially reasonable efforts to register or
qualify or cooperate with the selling Holders in connection with
the registration or qualification (or exemption from such
registration or qualification) of such Registrable Securities for
offer and sale under the applicable state securities or blue sky
laws of those jurisdictions within the United States as any Holder
reasonably requests in writing to keep each such registration or
qualification (or exemption therefrom) effective during the
Effectiveness Period and use its commercially reasonable efforts to
do any and all other acts or things necessary or advisable to
enable the disposition in such jurisdictions of the Registrable
Securities covered by the Registration Statements; provided, that the Company will
not be required to (i) qualify generally to do business or as a
dealer in securities in any jurisdiction where it is not then so
qualified or (ii) take any action which would subject the Company
to general service of process or any material tax in any such
jurisdiction where it is not then so subject.

 


11.9           The
Company will cooperate with the Holders to facilitate the timely
preparation and delivery of certificates representing Registrable
Securities to be delivered to a transferee pursuant to the
Registration Statements, which certificates shall be free of all
restrictive legends, and to enable such Registrable Securities to
be in such denominations and registered in such names as any such
Holders may request in writing. In connection therewith, if
required by the Company’s transfer agent, the Company will
promptly after the effectiveness of the Registration Statement
cause an opinion of counsel as to the effectiveness of the
Registration Statement to be delivered to its transfer agent when
and as required by such transfer agent from time to time, together
with any other authorizations, certificates and directions required
by the transfer agent which authorize and direct the transfer agent
to issue such Registrable Securities without legend upon sale by
the holder of such shares of Registrable Securities under the
Registration Statement.

 




 

8








 






 

 


11.10                      The
Company will use commercially reasonable efforts to prepare such
supplements or amendments, including a post-effective amendment, if
required by applicable law, to each applicable Registration
Statement and file any other required document so that such
Registration Statement will be Available at all times during the
Effectiveness Period; provided, that no such
supplement, amendment or filing will be required during a Black-Out
Period. No later than 8:00 p.m. (New York time) on any Trading Day
on which the Company receives a written notice (a
“Use
Notice”) prior to 2:00 p.m. (New York time) on such
Trading Day (or if such request is received after 2:00 p.m. (New
York time), no later than 8:00 p.m. (New York time) on the
following Trading Day) from a Holder that such Holder intends to
use the Registration Statement to resell Registrable Securities,
the Company will (A) provide written confirmation to such Holder
that the applicable Registration Statement is Available or (B)
provide written notice (a “Suspension
Notice”) that the use of such Registration Statement
is suspended due to a Black-Out Period. No Suspension Notice will
contain the reason for the Black-Out Period. The Company will
promptly provide the Holders written notice when the Black-Out
Period. If a Black-Out Period commences during any 30 Trading Day
period following delivery of a Use Notice and a notice from the
Company under clause (A) above, the Company will provide as
promptly as practicable the Holders with written notice thereof and
that the Registration Statement is no longer
Available.

 


11.11                      Notwithstanding
any other provision of the Agreement, no Holder of Registrable
Securities may include any of its Registrable Securities in the
Registration Statement pursuant to this Agreement unless the Holder
furnishes to the Company a completed questionnaire substantially in
the form of Exhibit A (the “Questionnaire”)
for use in connection with the Registration Statement at least ten
(10) Trading Days prior to the filing of the Registration
Statement; provided, however, an Investor shall not
be required to furnish a Questionnaire in connection with the
initial Registration Statement if such Investor owns Common Stock
initially purchased by such Investor at the Closing as of the
initial Filing Date. Each Holder who intends to include any of its
Registrable Securities in the Registration Statement shall promptly
furnish the Company in writing such other information as the
Company may reasonably request in writing.

 


11.12                      The
Holders may distribute the Registrable Securities by means of up to
two underwritten offerings; provided that (a) the
Electing Holders provide written notice to the Company of their
intention to distribute Registrable Securities by means of an
underwritten offering, (b) the managing underwriter or
underwriters thereof shall be designated by the Electing Holders;
provided,
however, that such
designated managing underwriter or underwriters shall be reasonably
acceptable to the Company, (c) each Holder participating in
such underwritten offering agrees to sell such Holder’s
Registrable Securities on the basis provided in any underwriting
arrangements approved by the persons entitled selecting the
managing underwriter or underwriters hereunder and (d) each
Holder participating in such underwritten offering completes and
executes all questionnaires, powers of attorney, indemnities,
underwriting agreements and other documents reasonably required
under the terms of such underwriting arrangements. The Company
hereby agrees with each Holder that, in connection with any
underwritten offering in accordance with the terms hereof, it will
negotiate in good faith and execute all indemnities, underwriting
agreements and other documents reasonably required under the terms
of such underwriting arrangements, including using all commercially
reasonable efforts to procure customary legal opinions and auditor
“comfort” letters.

 




 

9








 






 

 


11.13                      In
the event the Holders seek to complete an underwritten offering
pursuant to Section 3(l), for a reasonable period prior to the
filing of any Registration Statement, and throughout the
Effectiveness Period, the Company will make available upon
reasonable notice at the Company’s principal place of
business or such other reasonable place for inspection by the
managing underwriter or underwriters selected in accordance with
Section 3(l), such financial and other information and books and
records of the Company, and cause the officers, employees, counsel
and independent certified public accountants of the Company to
respond to such inquiries, as shall be reasonably necessary (and in
the case of counsel, not violate an attorney-client privilege in
such counsel’s reasonable belief), to conduct a reasonable
investigation within the meaning of Section 11 of the
Securities Act; provided, however, that the foregoing
inspection and information gathering on behalf of the Holders (and
any managing underwriter or underwriters) shall be conducted by
legal counsel to the Holders (and legal counsel to such managing
underwriter or underwriters); provided further, that each such party
shall be required to maintain in confidence and not to disclose to
any other Person any information or records reasonably designated
by the Company as being confidential, until such time as
(A) such information becomes a matter of public record
(whether by virtue of its inclusion in the Registration Statement
or in any other manner other than through the release of such
information by any Person afforded access to such information
pursuant hereto), or (B) such Person shall be required so to
disclose such information pursuant to a subpoena or order of any
court or other governmental agency or body having jurisdiction over
the matter (subject to the requirements of such order, and only
after such Person shall have given the Company prompt prior written
notice of such requirement).

 


12.           Registration
Expenses. All fees and expenses incident to the
Company’s performance of or compliance with their obligations
under this Agreement (excluding any underwriting discounts and
selling commissions, but including all legal fees and expenses of
one legal counsel to the Holders) shall be borne by the Company
whether or not any Registrable Securities are sold pursuant to a
Registration Statement. The fees and expenses referred to in the
foregoing sentence shall include, without limitation, (i) all
registration and filing fees (including, without limitation, fees
and expenses (A) with respect to filings required to be made with
the Trading Market, and (B) in compliance with applicable state
securities or blue sky laws), (ii) printing expenses (including,
without limitation, expenses of printing certificates for
Registrable Securities and of printing prospectuses if the printing
of prospectuses is reasonably requested by the holders of a
majority of the Registrable Securities included in the Registration
Statement), (iii) messenger, telephone and delivery expenses, (iv)
fees and disbursements of counsel for the Company, (v) Securities
Act liability insurance, if the Company so desires such insurance,
and (vi) fees and expenses of all other Persons retained by the
Company in connection with the consummation of the transactions
contemplated by this Agreement. In addition, the Company shall be
responsible for all of their internal expenses incurred in
connection with the consummation of the transactions contemplated
by this Agreement (including, without limitation, all salaries and
expenses of their officers and employees performing legal or
accounting duties), the expense of any annual audit and the fees
and expenses incurred in connection with the listing of the
Registrable Securities on any securities exchange as required
hereunder. For the avoidance of doubt, each Holder shall pay all
underwriting and placement discounts and commissions, agency and
placement fees, brokers’ commissions and transfer taxes, if
any, relating to the sale or disposition of such Holder’s
Registrable Securities. In addition to the foregoing, the Company
shall pay the reasonable legal fees and expenses of the single
counsel to the Holders in connection with the Registration
Statement (not to exceed $35,000 in the aggregate); provided, however, if the Holders
reasonably determine that local counsel is required in connection
with the Registration Statement, then the Company shall be
obligated to pay such reasonable legal fees and expense as well
(not to exceed $20,000 in the aggregate).

 




 

10








 






 

 


13.           Indemnification.

 


13.1           Indemnification
by the Company. The Company will, notwithstanding any
termination of this Agreement, jointly and severally, indemnify and
hold harmless each Holder and each underwriter, broker-dealer or
selling agent, if any, which facilitates the disposition of
Registrable Securities, the officers, directors, agents, partners,
members, stockholders and employees of each of them, each Person
who controls any such Holder, underwriter, broker-dealer or selling
agent (within the meaning of Section 15 of the Securities Act or
Section 20 of the Exchange Act) and the officers, directors, agents
and employees of each such controlling Person, to the fullest
extent permitted by applicable law, from and against any and all
losses, claims, damages, liabilities, costs (including, without
limitation, reasonable costs of preparation and reasonable
attorneys’ fees) and expenses (collectively,
“Losses”), as
incurred, arising out of or relating to any untrue or alleged
untrue statement of a material fact contained in any Registration
Statement, any Prospectus or any form of prospectus (including,
without limitation, any “issuer free writing
prospectus” as defined in Rule 433) or in any amendment or
supplement thereto or in any preliminary prospectus, or arising out
of or relating to any omission or alleged omission of a material
fact required to be stated therein or necessary to make the
statements therein (in the case of any Prospectus or form of
prospectus (including, without limitation, any “issuer free
writing prospectus” as defined in Rule 433) or supplement
thereto, in light of the circumstances under which they were made)
not misleading, except to the extent, but only to the extent, that
(i) such Losses arise out of or are based upon any untrue
statements, alleged untrue statements, omissions or alleged
omissions that are based solely upon information regarding such
Holder, underwriter, broker-dealer or selling agent furnished in
writing to the Company by such Person expressly for use therein
pursuant to Section 3(k) or (ii) such Losses arise out of or are
based upon transfers of Registrable Securities during a Black-Out
Period. The Company shall notify the Holders promptly of the
institution, threat or assertion of any Proceeding of which the
Company is aware in connection with the transactions contemplated
by this Agreement.

 


13.2           Indemnification
by Holders. Each Holder shall, notwithstanding any
termination of this Agreement, severally and not jointly, indemnify
and hold harmless the Company, its directors, officers, agents and
employees, each Person who controls the Company (within the meaning
of Section 15 of the Securities Act and Section 20 of the Exchange
Act), and the directors, officers, agents or employees of such
controlling Persons, to the fullest extent permitted by applicable
law, from and against all Losses, as incurred, arising solely out
of or based solely upon any untrue statement of a material fact
contained in any Registration Statement, any Prospectus, or any
form of prospectus (including, without limitation, any
“issuer free writing prospectus” as defined in Rule
433), or in any amendment or supplement thereto, or arising solely
out of or based solely upon any omission of a material fact
required to be stated therein or necessary to make the statements
therein (in the case of any Prospectus, or any form of prospectus
(including, without limitation, any “issuer free writing
prospectus” as defined in Rule 433) or supplement thereto, in
light of the circumstances under which they were made) not
misleading to the extent, but only to the extent, that such untrue
statements or omissions are based solely upon information regarding
such Holder furnished in writing to the Company by such Holder in
the Questionnaire or otherwise expressly for use therein. In no
event shall the liability of any selling Holder hereunder be
greater in amount than the dollar amount of the net proceeds
received by such Holder upon the sale of the Registrable Securities
giving rise to such indemnification obligation.

 




 

11








 






 

 


13.3           Conduct
of Indemnification Proceedings. If any Proceeding shall be
brought or asserted against any Person entitled to indemnity
hereunder (an “Indemnified
Party”), such Indemnified Party shall promptly notify
the Person from whom indemnity is sought (the “Indemnifying
Party”) in writing, and the Indemnifying Party shall
be permitted to assume the defense thereof, including the
employment of counsel reasonably satisfactory to the Indemnified
Party (whose approval shall not be unreasonably withheld) and the
payment of all fees and expenses incurred in connection with
defense thereof; provided, that the failure of
any Indemnified Party to give such notice shall not relieve the
Indemnifying Party of its obligations or liabilities pursuant to
this Agreement, except (and only) to the extent that it shall be
finally determined by a court of competent jurisdiction (which
determination is not subject to appeal or further review) that such
failure shall have proximately and materially adversely prejudiced
the Indemnifying Party.

 


An
Indemnified Party shall have the right to employ separate counsel
in any such Proceeding and to participate in the defense thereof,
but the fees and expenses of such counsel shall be at the expense
of such Indemnified Party or Parties unless:  (1) the
Indemnifying Party has agreed in writing to pay such fees and
expenses; (2) the Indemnifying Party shall have failed promptly to
assume the defense of such Proceeding and to employ counsel
reasonably satisfactory to such Indemnified Party in any such
Proceeding (whose approval shall not be unreasonably withheld); or
(3) the named parties to any such Proceeding (including any
impleaded parties) include both such Indemnified Party and the
Indemnifying Party, and such Indemnified Party shall have been
advised by counsel that a conflict of interest is likely to exist
if the same counsel were to represent such Indemnified Party and
the Indemnifying Party (in which case, if such Indemnified Party
notifies the Indemnifying Party in writing that it elects to employ
separate counsel at the expense of the Indemnifying Party, the
Indemnifying Party shall not have the right to assume the defense
thereof and such counsel shall be at the expense of the
Indemnifying Party); provided that the Indemnifying
Party shall not be liable for the fees and expenses of more than
one separate firm of attorneys at any time for all Indemnified
Parties.  The Indemnifying Party shall not be liable for any
settlement of any such Proceeding effected without its written
consent, which consent shall not be unreasonably withheld.  No
Indemnifying Party shall, without the prior written consent of the
Indemnified Party, effect any settlement of any pending Proceeding
in respect of which any Indemnified Party is a party, unless such
settlement includes an unconditional release of such Indemnified
Party from all liability on claims that are the subject matter of
such Proceeding.

 


All
fees and expenses of the Indemnified Party (including reasonable
fees and expenses to the extent incurred in connection with
investigating or preparing to defend such Proceeding in a manner
not inconsistent with this Section) shall be paid to the
Indemnified Party, as incurred, promptly upon receipt of written
notice thereof to the Indemnifying Party (regardless of whether it
is ultimately determined that an Indemnified Party is not entitled
to indemnification hereunder; provided that the Indemnifying
Party may require such Indemnified Party to undertake to reimburse
all such fees and expenses to the extent it is finally judicially
determined that such Indemnified Party is not entitled to
indemnification hereunder).

 




 

12








 






 

 


13.4           Contribution.
If a claim for indemnification under Section 5(a) or 5(b) is
unavailable to an Indemnified Party (by reason of public policy or
otherwise), then each Indemnifying Party, in lieu of indemnifying
such Indemnified Party, shall contribute to the amount paid or
payable by such Indemnified Party as a result of such Losses, in
such proportion as is appropriate to reflect the relative fault of
the Indemnifying Party and Indemnified Party in connection with the
actions, statements or omissions that resulted in such Losses as
well as any other relevant equitable considerations.  The
relative fault of such Indemnifying Party and Indemnified Party
shall be determined by reference to, among other things, whether
any action in question, including any untrue or alleged untrue
statement of a material fact or omission or alleged omission of a
material fact, has been taken or made by, or relates to information
supplied by, such Indemnifying Party or Indemnified Party, and the
parties’ relative intent, knowledge, access to information
and opportunity to correct or prevent such action, statement or
omission.  The amount paid or payable by a party as a result
of any Losses shall be deemed to include, subject to the
limitations set forth in Section 5(c), any reasonable
attorneys’ or other reasonable fees or expenses incurred by
such party in connection with any Proceeding to the extent such
party would have been indemnified for such fees or expenses if the
indemnification provided for in this Section was available to such
party in accordance with its terms.

 


The
parties hereto agree that it would not be just and equitable if
contribution pursuant to this Section 5(d) were determined by pro
rata allocation or by any other method of allocation that does not
take into account the equitable considerations referred to in the
immediately preceding paragraph.  Notwithstanding the
provisions of this Section 5(d), no Holder shall be required to
contribute, in the aggregate, any amount in excess of the amount by
which the proceeds actually received by such Holder from the sale
of the Registrable Securities subject to the Proceeding exceeds the
amount of any damages that such Holder has otherwise been required
to pay by reason of such untrue or alleged untrue statement or
omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent
misrepresentation.

 


The
indemnity and contribution agreements contained in this Section are
in addition to any liability that the Indemnifying Parties may have
to the Indemnified Parties and are not in diminution or limitation
of the indemnification provisions under the Purchase
Agreement.

 


14.           Facilitation
of Sales Pursuant to Rule 144. To the extent it shall be
required to do so under the Exchange Act, the Company shall timely
file the reports required to be filed by it under the Exchange Act
or the Securities Act (including the reports under Sections 13
and 15(d) of the Exchange Act referred to in subparagraph (c)(1) of
Rule 144), and shall take such further action as any Holder
may reasonably request, all to the extent required from time to
time to enable the Holders to sell Registrable Securities without
registration under the Securities Act within the limitations of the
exemption provided by Rule 144. Upon the request of any Holder
in connection with that Holder’s sale pursuant to
Rule 144, the Company shall deliver to such Holder a written
statement as to whether it has complied with such
requirements.

 




 

13








 






 

 


15.           Miscellaneous.

 


15.1           Remedies.
In the event of a breach by the Company or by a Holder, of any of
their obligations under this Agreement, each Holder or the Company,
as the case may be, in addition to being entitled to exercise all
rights granted by law and under this Agreement, including recovery
of damages, will be entitled to specific performance of its rights
under this Agreement.  The Company and each Holder agree that
monetary damages would not provide adequate compensation for any
losses incurred by reason of a breach by it of any of the
provisions of this Agreement and further agree that, in the event
of any action for specific performance in respect of such breach,
it shall waive the defense that a remedy at law would be
adequate.

 


15.2           Discontinued
Disposition. Each Holder agrees by its acquisition of such
Registrable Securities that, that it will not commence a
disposition of Registrable Securities under the Registration
Statement until such Holder has received (A) written confirmation
from the Company of the availability of the Registration Statement
as described in Section 3(j)(A), (B) written confirmation from the
Company that the Black-Out Period has ceased as described in
Section 3(j) or (C) copies of the supplemented Prospectus and/or
amended Registration Statement as described in Section 3(j), and,
in each case, has also received copies of any additional or
supplemental filings that are incorporated or deemed to be
incorporated by reference in such Prospectus or Registration
Statement.  The Company may provide appropriate stop orders to
enforce the provisions of this paragraph.

 


15.3           Amendments
and Waivers. No provision of this Agreement may be waived or
amended except in a written instrument signed by the Company and
the Electing Holders. No waiver of any default with respect to any
provision, condition or requirement of this Agreement shall be
deemed to be a continuing waiver in the future or a waiver of any
subsequent default or a waiver of any other provision, condition or
requirement hereof, nor shall any delay or omission of either party
to exercise any right hereunder in any manner impair the exercise
of any such right.

 


15.4           Notices.
Except where explicitly stated otherwise, any and all notices or
other communications or deliveries required or permitted to be
provided hereunder shall be in writing and shall be deemed given
and effective on the earliest of (i) the date of transmission, if
such notice or communication is delivered via facsimile or
electronic mail as specified in this Section prior to 5:00 p.m.
(New York time) on a Business Day, (ii) the Business Day after the
date of transmission, if such notice or communication is delivered
via facsimile or electronic mail as specified in this Agreement
later than 5:00 p.m. (New York time) on any date and earlier than
11:59 p.m. (New York time) on such date, (iii) the Business Day
following the date of mailing, if sent by nationally recognized
overnight courier service, or (iv) upon actual receipt by the party
to whom such notice is required to be given.  The address for
such notices and communications shall be as follows:

 




 

14








 






 

 


	
 

	

If
to the Company:

	
 

	

Cellular
Biomedicine Group, Inc.


	
 

	
 

	
 

	

19925 Stevens
Creek Blvd., Suite 100


Cupertino, CA
95014


Attention: Andy
Chan, Secretary and Senior Vice President


E-mail:
andy.chan@cellbiomedgroup.com


	
 

	
 

	
 

	
 


	
 

	
 

	
 

	
 


	
 

	

With
a copy to:

	
 

	

Ellenoff
Grossman & Schole LLP


1345
Avenue of the Americas


New
York, New York 10105


Attention: Sarah
Williams


Facsimile: (212)
370-7889


E-mail:
swilliams@egsllp.com


	
 

	
 

	
 

	
 

	
 


	
 


	
 

	

If
to the Investors:

	
 

	

Sailing Capital
Overseas Investments Management Ltd


190
Elgin Avenue, George Town, Grand Cayman KY1-9005


Cayman
Islands


Attention: Bosun
S. Hau


Managing
Director / Partner


E-mail:
bosunhau@sailing-capital.com


	
 

	
 


	
 

	

With
a copy to:

	
 

	

Wilson Sonsini
Goodrich & Rosati, Professional Corporation


	
 

	
 

	
 

	

12235 El Camino
Real


San
Diego, CA 92130


	
 

	
 

	
 

	

Attention: Dan
Koeppen


	
 

	
 

	
 

	

Facsimile:
858-350-2393


	
 

	
 

	
 

	

Email:
dkoeppen@wsgr.com







 

 


or such
other address as may be designated in writing hereafter, in the
same manner, by such Person.

 


15.5           Successors
and Assigns. This Agreement shall inure to the benefit of
and be binding upon the successors and permitted assigns of each of
the parties and shall inure to the benefit of each Holder. The
Company may not assign (other than by operation of law) its rights
or obligations hereunder without the prior written consent of the
Electing Holders. The Investors may not assign their rights and
obligations hereunder (other than by operation of law);
provided that an
Investor may assign its rights and obligations hereunder to an
Affiliate of such Investor. Upon any distribution of the
Registrable Securities to the limited partners of an Investor, this
Agreement shall inure to the benefit of and be binding upon such
limited partners receiving the Registrable Securities.

 




 

15








 






 

 


15.6           Execution
and Counterparts. This Agreement may be executed in any
number of counterparts, each of which when so executed shall be
deemed to be an original and, all of which taken together shall
constitute one and the same Agreement.  In the event that any
signature is delivered by facsimile or electronic mail
transmission, such signature shall create a valid binding
obligation of the party executing (or on whose behalf such
signature is executed) the same with the same force and effect as
if such signature delivered by facsimile or electronic mail
transmission were the original thereof.

 


15.7           Governing
Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York without regard to
choice of laws or conflicts of laws provisions thereof that would
require the application of the laws of any other
jurisdiction.

 


15.8           Submission
to Jurisdiction. Each of the parties to this Agreement
irrevocably and unconditionally submits, for itself and its
property, to the exclusive jurisdiction of the courts of the State
of New York sitting in New York County and of the United States
District Court of the Southern District of New York, and any
appellate court from any thereof, in any action or proceeding
arising out of or relating to this Agreement, or for the
recognition or enforcement of any judgment, and each of the parties
hereto irrevocably and unconditionally agrees that all claims in
respect of any such action or proceeding may be heard and
determined in such New York State court or, to the fullest extent
permitted by applicable law, in such federal court. Each of the
parties hereto agrees that a final judgment in any such action or
proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner
provided by law.

 


15.9           Waiver
of Venue. Each of the parties to this Agreement irrevocably
and unconditionally waives, to the fullest extent permitted by
applicable law, (i) any objection that it may now or hereafter have
to the laying of venue of any action or proceeding arising out of
or relating to this Agreement in any court referred to in Section
7(h) and (ii) the defense of an inconvenient forum to the
maintenance of such action or proceeding in any such
court.

 


15.10                      Cumulative
Remedies. The remedies provided herein are cumulative and
not exclusive of any remedies provided by law.

 


15.11                      Severability.
If any term, provision, covenant or restriction of this Agreement
is held by a court of competent jurisdiction to be invalid,
illegal, void or unenforceable, the remainder of the terms,
provisions, covenants and restrictions set forth herein shall
remain in full force and effect and shall in no way be affected,
impaired or invalidated, and the parties hereto shall use their
reasonable efforts to find and employ an alternative means to
achieve the same or substantially the same result as that
contemplated by such term, provision, covenant or
restriction.  It is hereby stipulated and declared to be the
intention of the parties that they would have executed the
remaining terms, provisions, covenants and restrictions without
including any of such that may be hereafter declared invalid,
illegal, void or unenforceable.

 


15.12                      Entire
Agreement. This Agreement constitutes the entire agreement
between the parties hereto pertaining to the subject matter hereof,
and supersedes all other prior agreements and understandings, both
written and oral, between the parties, with respect to the subject
matter hereof.

 


15.13                      Headings;
Section References. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise
affect the meaning hereof. Unless otherwise stated, references to
Sections, Schedules and Exhibits are to the Sections, Schedules and
Exhibits of this Agreement.

 


[Signature
Pages Follow]

 




 

16








 






IN
WITNESS WHEREOF, the parties have executed this Registration Rights
Agreement as of the date first written above.

 


 

 


	
 

	

CELLULAR
BIOMEDICINE GROUP, INC.


	
 

	

By:                                                               


	
 

	

Name:


	
 

	

Title:







 




[Signature
Page to the Registration Rights Agreement]


 


 








 






IN
WITNESS WHEREOF, the parties have executed or caused this Agreement
to be executed as of the date first written above.

 

 


INVESTOR:

 


WEALTH
MAP HOLDINGS LIMITED, A BVI COMPANY


 

 



By:






 



Name: James Xiao Dong
Liu





 



Title: Director    








 

 


Address: c/o Unit
2006-08


20/F
Harbour Centre, 25 Harbour Road


Wan
Chai, Hong Kong


 


Email:
jamesliu@sailing-capital.com

 


 

 


 

 




[Signature
Page to the Registration Rights Agreement]


 


 








 






IN
WITNESS WHEREOF, the parties have executed or caused this Agreement
to be executed as of the date first written above.

 

 


INVESTOR:

 


EARLS
MILL LIMITED, A BVI COMPANY


 

 



By:
 






 



Name: James Xiao Dong
Liu






 



Title: Director  






 


Address: c/o Unit
2006-08


20/F
Harbour Centre, 25 Harbour Road


Wan
Chai, Hong Kong


 


Email:
jamesliu@sailing-capital.com

 


 




[Signature
Page to the Registration Rights Agreement]


 


 


 








 






IN
WITNESS WHEREOF, the parties have executed or caused this Agreement
to be executed as of the date first written above.

 

 


INVESTOR:


 

 


 


Bosun
S. Hau


 

 




[Signature
Page to the Registration Rights Agreement]


 


 


 








 







ANNEX A

 



PLAN OF DISTRIBUTION

 


The
selling securityholders, including their pledgees, donees,
transferees, distributees, beneficiaries or other successors in
interest, may from time to time offer some or all of the shares of
common stock (collectively, “Securities”)
covered by this prospectus. To the extent required, this prospectus
may be amended and supplemented from time to time to describe a
specific plan of distribution.

 


     The
selling securityholders will not pay any of the costs, expenses and
fees in connection with the registration and sale of the shares
covered by this prospectus, but they will pay any and all
underwriting discounts, selling commissions and stock transfer
taxes, if any, attributable to sales of the shares. We will not
receive any proceeds from the sale of the shares of our common
stock covered hereby.

 


     The
selling securityholders may sell the Securities covered by this
prospectus from time to time, and may also decide not to sell all
or any of the Securities that they are allowed to sell under this
prospectus. The selling securityholders will act independently of
us in making decisions regarding the timing, manner and size of
each sale. These dispositions may be at fixed prices, at market
prices prevailing at the time of sale, at prices related to such
prevailing market prices, at varying prices determined at the time
of sale, or at privately negotiated prices. Sales may be made by
the selling securityholders in one or more types of transactions,
which may include:

 



● 

purchases by
underwriters, dealers and agents who may receive compensation in
the form of underwriting discounts, concessions or commissions from
the selling securityholders and/or the purchasers of the Securities
for whom they may act as agent;





 



● 

one or more block
transactions, including transactions in which the broker or dealer
so engaged will attempt to sell the Securities as agent but may
position and resell a portion of the block as principal to
facilitate the transaction, or in crosses, in which the same broker
acts as an agent on both sides of the trade;





 



● 

ordinary brokerage
transactions or transactions in which a broker solicits
purchases;





 



● 

purchases by a
broker-dealer or market maker, as principal, and resale by the
broker-dealer for its account;





 



● 

the pledge of
Securities for any loan or obligation, including pledges to brokers
or dealers who may from time to time effect distributions of
Securities;





 



● 

short sales or
transactions to cover short sales relating to the
Securities;





 




 








 






 

 



● 

one or more
exchanges or over the counter market transactions;





 



● 

through
distribution by a selling securityholder or its successor in
interest to its members, general or limited partners or
shareholders (or their respective members, general or limited
partners or shareholders);





 



● 

privately
negotiated transactions;





 



● 

the writing of
options, whether the options are listed on an options exchange or
otherwise;





 



● 

distributions to
creditors and equity holders of the selling securityholders;
and





 



● 

any combination of
the foregoing, or any other available means allowable under
applicable law.





 


     A
selling securityholder may also resell all or a portion of its
Securities in open market transactions in reliance upon Rule 144
under the Securities Act provided it meets the criteria and
conforms to the requirements of Rule 144.

 


     The
selling securityholders may enter into sale, forward sale and
derivative transactions with third parties, or may sell securities
not covered by this prospectus to third parties in privately
negotiated transactions. If the applicable prospectus supplement
indicates, in connection with those sale, forward sale or
derivative transactions, the third parties may sell securities
covered by this prospectus and the applicable prospectus
supplement, including in short sale transactions and by issuing
securities that are not covered by this prospectus but are
exchangeable for or represent beneficial interests in the common
stock. The third parties also may use shares received under those
sale, forward sale or derivative arrangements or shares pledged by
the selling securityholder or borrowed from the selling
securityholders or others to settle such third-party sales or to
close out any related open borrowings of common stock. The third
parties may deliver this prospectus in connection with any such
transactions. Any third party in such sale transactions will be an
underwriter and will be identified in the applicable prospectus
supplement (or a post-effective amendment to the registration
statement of which this prospectus is a part).

 


     In
addition, the selling securityholders may engage in hedging
transactions with broker-dealers in connection with distributions
of Securities or otherwise. In those transactions, broker-dealers
may engage in short sales of securities in the course of hedging
the positions they assume with selling securityholders. The selling
securityholders may also sell securities short and redeliver
securities to close out such short positions. The selling
securityholders may also enter into option or other transactions
with broker-dealers which require the delivery of securities to the
broker-dealer. The broker-dealer may then resell or otherwise
transfer such securities pursuant to this prospectus. The selling
securityholders also may loan or pledge shares, and the borrower or
pledgee may sell or otherwise transfer the Securities so loaned or
pledged pursuant to this prospectus. Such borrower or pledgee also
may transfer those Securities to investors in our securities or the
selling securityholders’ securities or in connection with the
offering of other securities not covered by this
prospectus.

 




 








 






 

 


     To
the extent necessary, we may amend or supplement this prospectus
from time to time to describe a specific plan of distribution. We
will file a supplement to this prospectus, if required, upon being
notified by the selling securityholders that any material
arrangement has been entered into with a broker-dealer for the sale
of shares through a block trade, offering or a purchase by a broker
or dealer. The applicable prospectus supplement will set forth the
specific terms of the offering of securities,
including:

 



● 

the number of
Securities offered;





 



● 

the price of such
Securities;





 



● 

the proceeds to the
selling securityholders from the sale of such
Securities;





 



● 

the names of the
underwriters or agents, if any;





 



● 

any underwriting
discounts, agency fees or other compensation to underwriters or
agents; and





 



● 

any discounts or
concessions allowed or paid to dealers.





 


     The
selling securityholders may, or may authorize underwriters, dealers
and agents to, solicit offers from specified institutions to
purchase Securities from the selling securityholders at the public
offering price listed in the applicable prospectus supplement.
These sales may be made under “delayed delivery
contracts” or other purchase contracts that provide for
payment and delivery on a specified future date. Any contracts like
this will be described in and be subject to the conditions listed
in the applicable prospectus supplement.

 


     Broker-dealers
or agents may receive compensation in the form of commissions,
discounts or concessions from the selling securityholders.
Broker-dealers or agents may also receive compensation from the
purchasers of Securities for whom they act as agents or to whom
they sell as principals, or both. Compensation as to a particular
broker-dealer might be in excess of customary commissions and will
be in amounts to be negotiated in connection with transactions
involving securities. In effecting sales, broker-dealers engaged by
the selling securityholders may arrange for other broker-dealers to
participate in the resales.

 


     In
connection with sales of Securities covered hereby, the selling
securityholders and any underwriter, broker-dealer or agent and any
other participating broker-dealer that executes sales for the
selling securityholders may be deemed to be an
“underwriter” within the meaning of the Securities Act
of 1933, as amended (the “Securities
Act”). Accordingly, any profits realized by the
selling securityholders and any compensation earned by such
underwriter, broker-dealer or agent may be deemed to be
underwriting discounts and commissions. Because the selling
securityholders may be deemed to be “underwriters”
under the Securities Act, the selling securityholders must deliver
this prospectus and any prospectus supplement in the manner
required by the Securities Act. This prospectus delivery
requirement may be satisfied through the facilities of the NASDAQ
Global Market in accordance with Rule 153 under the Securities
Act.

 




 








 






 

 


     We
and the selling securityholders have agreed to indemnify each other
against certain liabilities, including liabilities under the
Securities Act. In addition, we or the selling securityholders may
agree to indemnify any underwriters, broker-dealers and agents
against or contribute to any payments the underwriters,
broker-dealers or agents may be required to make with respect to,
civil liabilities, including liabilities under the Securities Act.
Underwriters, broker-dealers and agents and their affiliates are
permitted to be customers of, engage in transactions with, or
perform services for us and our affiliates or the selling
securityholders or their affiliates in the ordinary course of
business.

 


     The
selling securityholders will be subject to applicable provisions of
Regulation M of the Securities Exchange Act of 1934 and the rules
and regulations thereunder, which provisions may limit the timing
of purchases and sales of any of the Securities by the selling
securityholders. Regulation M may also restrict the ability of any
person engaged in the distribution of the Securities to engage in
market-making activities with respect to the Securities. These
restrictions may affect the marketability of such
Securities.

 


     In
order to comply with applicable securities laws of some states, the
Securities may be sold in those jurisdictions only through
registered or licensed brokers or dealers. In addition, in certain
states the Securities may not be sold unless they have been
registered or qualified for sale in the applicable state or an
exemption from the registration or qualification requirements is
available. In addition, any Securities of a selling securityholder
covered by this prospectus that qualify for sale pursuant to Rule
144 under the Securities Act may be sold in open market
transactions under Rule 144 rather than pursuant to this
prospectus.

 


     In
connection with an offering of Securities under this prospectus,
the underwriters may purchase and sell securities in the open
market. These transactions may include short sales, stabilizing
transactions and purchases to cover positions created by short
sales. Short sales involve the sale by the underwriters of a
greater number of securities than they are required to purchase in
an offering. Stabilizing transactions consist of certain bids or
purchases made for the purpose of preventing or retarding a decline
in the market price of the securities while an offering is in
progress.

 


     The
underwriters also may impose a penalty bid. This occurs when a
particular underwriter repays to the underwriters a portion of the
underwriting discount received by it because the underwriters have
repurchased securities sold by or for the account of that
underwriter in stabilizing or short-covering
transactions.

 


     These
activities by the underwriters may stabilize, maintain or otherwise
affect the market price of the Securities offered under this
prospectus. As a result, the price of the

 


Securities may be
higher than the price that otherwise might exist in the open
market. If these activities are commenced, they may be discontinued
by the underwriters at any time. These transactions may be effected
on the NASDAQ Global Market or another securities exchange or
automated quotation system, or in the over-the-counter market or
otherwise.

 




 








 







EXHIBIT A

 



FORM OF

 



SELLING SECURITYHOLDER QUESTIONNAIRE

 


Reference
is made to that certain registration rights agreement (the
“Registration Rights
Agreement”), dated as of [______________], by and
among Cellular Biomedicine Group, Inc. (the “Company”), and
[______________]. Capitalized terms used and not defined herein
shall have the meanings given to such terms in the Registration
Rights Agreement.

 


The
undersigned Holder (the “Selling
Securityholder”) of the Registrable Securities is
providing this Selling Securityholder Questionnaire pursuant to
Section 3(k) of the Registration Rights Agreement. The Selling
Securityholder, by signing and returning this Selling
Securityholder Questionnaire, understands that it will be bound by
the terms and conditions of this Selling Securityholder
Questionnaire and the Registration Rights Agreement. The Selling
Securityholder hereby acknowledges its indemnity obligations
pursuant to Section 5(b) of the Registration Rights
Agreement.

 


The
Selling Securityholder provides the following information to the
Company and represents and warrants that such information is
accurate and complete:

 



(1)            

(a)            

Full Legal Name of
Selling Securityholder:






______________________________________



(b) 

Full Legal Name of
Registered Holder (if not the same as (a) above) through which
Registrable Securities listed in (3) below are held:






______________________________________



(c) 

Full Legal Name of
DTC Participant (if applicable and if not the same as (b) above)
through which Registrable Securities listed in (3) below are
held:






____________________________________

 



(2)            

Address for Notices
to Selling Securityholder:






______________________________________


______________________________________



Telephone
(including area code): 


____________________







Fax (including area
code):

__________________________







Contact
Person:    


________________________________






 



(3)            

Beneficial
Ownership of Registrable Securities:






__________________________________________



(a)            

Type and Principal
Amount/Number of Registrable Securities beneficially
owned:






__________________________________________



(b)            

CUSIP No(s). of
such Registrable Securities beneficially owned:






__________________________________________



(4) 

Beneficial
Ownership of Other Securities of the Company Owned by the Selling
Securityholder:











-1-








 






 



Except as set forth below in this Item (4), the Selling
Securityholder is not the beneficial or registered owner of any
securities of the Company other than the Registrable Securities
listed above in Item (3).



(a) 

Type and Amount of
Other Securities beneficially owned by the Selling
Securityholder:





 


_________________________________________

 



(b)            

CUSIP No(s). of
such Other Securities beneficially owned:





 



(5)            

Relationship with
the Company:







Except as set forth below, neither the Selling Securityholder nor
any of its affiliates, officers, directors or principal equity
holders (5% or more) has held any position or office or has had any
other material relationship with the Company (or its predecessors
or affiliates) during the past three years.


State
any exceptions here:

 



(6)            

Is the Selling
Securityholder a registered broker-dealer?







Yes      



☐








No     



☐







If
“Yes”, please answer subsection (a) and subsection
(b):


(a) Did
the Selling Securityholder acquire the Registrable Securities as
compensation for underwriting/broker-dealer activities to the
Company?



Yes  



☐








No    



☐







(b) If
you answered “No” to question 6(a), please explain your
reason for acquiring the Registrable Securities:


___________________________________________________


___________________________________________________

 



(7)            

Is the Selling
Securityholder an affiliate of a registered
broker-dealer?







Yes      



☐








No      



☐







If
“Yes”, please identify the registered broker-dealer(s),
describe the nature of the affiliation(s) and answer subsection (a)
and subsection (b):


_________________________________________________


_________________________________________________


(a) Did
the Selling Securityholder purchase the Registrable Securities in
the ordinary course of business (if no, please
explain)?



Yes   



☐








No     



☐







Explain:


              
_________________________________________________


_________________________________________________


 



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(b) Did
the Selling Securityholder have an agreement or understanding,
directly or indirectly, with any person to distribute the
Registrable Securities at the same time the Registrable Securities
were originally purchased (if yes, please explain)?



Yes   



☐








No  



☐







Explain:



(8)            

Is the Selling
Securityholder a non-public entity?







Yes  



☐








No  



☐







If
“Yes”, please answer subsection (a):


(a)
Identify the natural person or persons that have voting or
investment control over the Registrable Securities that the
non-public entity owns:



(9)            

Plan of
Distribution:





 


The
Selling Securityholder (including its donees and pledgees) intends
to distribute the Registrable Securities listed above in Item (3)
pursuant to the Registration Statement in accordance with the Plan
of Distribution attached as Annex A to the Registration Rights
Agreement.

 


The
Selling Securityholder acknowledges that it understands its
obligations to comply with the provisions of the Securities
Exchange Act of 1934, as amended, and the rules thereunder relating
to stock manipulation, particularly Regulation M thereunder (or any
successor rules or regulations), in connection with any offering of
Registrable Securities pursuant to the Shelf Registration
Agreement. The Selling Securityholder agrees that neither it nor
any person acting on its behalf will engage in any transaction in
violation of such provisions.

 


Pursuant
to the Registration Rights Agreement, the Company has agreed under
certain circumstances to indemnify the Selling Securityholder
against certain liabilities.

 


In the
event the Selling Securityholder transfers all or any portion of
the Registrable Securities listed in Item (3) above after the date
on which such information is provided to the Company other than
pursuant to the Registration Statement, the Selling Securityholder
agrees to notify the transferee(s) at the time of the transfer of
its rights and obligations under this Selling Securityholder
Questionnaire and the Registration Rights Agreement.

 


In
accordance with the Selling Securityholder’s obligation under
the Registration Rights Agreement to provide such information as
may be required by law or by the staff of the Commission for
inclusion in the Registration Statement, the Selling Securityholder
agrees to promptly notify the Company of any inaccuracies or
changes in the information provided herein that may occur
subsequent to the date hereof at anytime while the Registration
Statement remains effective. All notices to the Selling
Securityholder pursuant to the Registration Rights Agreement shall
be made in writing, by hand-delivery, first-class mail, or air
courier guaranteeing overnight delivery to the address set forth
below.

 



-3-








 






 

 


By
signing below, the Selling Securityholder consents to the
disclosure of the information contained herein in its answers to
Items (1) through (9) above and the inclusion of such information
in the Registration Statement and the related Prospectus. The
undersigned understands that such information will be relied upon
by the Company in connection with the preparation or amendment of
the Registration Statement and the related Prospectus.

 


By
signing below, the undersigned agrees that if the Company notifies
the undersigned that the Registration Statement is not available
pursuant to the terms of the Registration Rights Agreement, the
undersigned will suspend use of the Prospectus until notice from
the Company that the Prospectus is again available.

 


Once
this Selling Securityholder Questionnaire is executed by the
undersigned and received by the Company, the terms of this Selling
Securityholder Questionnaire, and the representations, warranties
and agreements contained herein, shall be binding on, shall inure
to the benefit of and shall be enforceable by the respective
successors, heirs, personal representatives, and assigns of the
Company and the undersigned with respect to the Registrable
Securities beneficially owned by the undersigned and listed in Item
(3) above. This Selling Securityholder Questionnaire shall be
governed by and construed in accordance with the laws of the State
of New York without regard to choice of laws or conflicts of laws
provisions thereof that would require the application of the laws
of any other jurisdiction.

 


 



-4-








 






IN
WITNESS WHEREOF, the undersigned, by authority duly given, has
caused this Selling Securityholder Questionnaire to be executed and
delivered either in person or by its duly authorized
agent.

 


Dated:
_______________________


 


Beneficial
Owner



By:                                                                 









Name:                                                                   







Title:                                                                   






 

 


PLEASE
RETURN THE COMPLETED AND EXECUTED


SELLING
SECURITYHOLDER QUESTIONNAIRE TO THE COMPANY AT:

 






 


 



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