EX-10.5




 Exhibit 10.5 

Subscription Deed 

Mesoblast Limited 
 ABN
68 109 431 870 
 and 

Cephalon International Holdings, Inc. 

Middletons Lawyers 

Melbourne office 
 Ref:
MLUM.NZM:10024006 








 Subscription Deed 

Date    2010 

Parties 
 1. Mesoblast
Limited ABN 68 109 431 870 of Level 39, 55 Collins Street, Melbourne, Victoria 3000, Australia (Mesoblast) 
 2. Cephalon
International Holdings, Inc. of 41 Moores Road, Frazer, PA 19355, United States of America (Cephalon) 
 Background 

A. Mesoblast and Angioblast Systems, Inc. (Angioblast) have entered into a merger agreement dated as of September 28, 2010 and
amended on October 13, 2010 for the acquisition by Mesoblast of all of the issued capital of Angioblast (Merger Agreement). 

B. Cephalon, simultaneously with the execution of this Subscription Deed, will: 

(a) enter into a development and commercialisation agreement with Angioblast under which Cephalon is to acquire the license of certain
intellectual property rights of Angioblast in specified applications and territories; and 
 (b) acquire certain stock in Angioblast which
in accordance with the terms of the Merger Agreement will on completion under that agreement be extinguished with Mesoblast issuing new Shares to those persons holding Angioblast stock on the date of completion. 

C. Mesoblast wishes to issue and Cephalon wishes to subscribe for additional Shares which on issue, in aggregate with the Shares to be issued
to Cephalon on completion under the Merger Agreement, will result in Cephalon holding 19.99% of the issued Shares. 
 D. Mesoblast has
agreed to issue and Cephalon has agreed to subscribe for the additional Shares as outlined in accordance with Recital C on the terms and condition of this Deed. 

Operative Provisions 

1. Definitions and interpretation 

1.1 Definitions. In this Deed: 

AEDST means Australian Eastern daylight saving time; 

Angioblast means Angioblast Systems, Inc. a company incorporated under the laws of State of Delaware, in the United States; 








 ASX means the Australian Securities Exchange or ASX Limited, as the context requires;
ASX Listing Rules means the Official Listing Rules of ASX; 
 Business Day means a day which is not a Saturday, Sunday, public
holiday or bank holiday in Victoria Australia; 
 Cephalon Associates means any officer of Cephalon or any person or entity who would
constitute an “associate” of Cephalon (where Cephalon was an Australian company) within the meaning given to the terms “associate” under sections 11, 12 and 15 of the Corporations Act; 

Claim includes a claim, notice, demand, action, proceeding, litigation, prosecution, arbitration, investigation, judgment, award,
damage, loss, cost, expense or Liability however arising, whether present, unascertained, immediate, future or contingent, whether based in contract, tort or statute and whether involving a third party or a party to this Deed or otherwise; 

Completion Date means (subject to clause 2.2(b) that date being not more than 2 Business Days after the date that each of the
Conditions Precedent is satisfied; 
 Conditions Precedent means the conditions precedent to the issue of the Subscription Shares as
detailed in clause 3.1; 
 Control Proposal means any proposed or possible transaction or arrangement which, if entered into or
completed, would result in any person: 
 (a) acquiring (whether directly or indirectly): 

(i) an interest in all or a substantial part of the business of the Mesoblast Group, or a right to acquire any such interest; or 

(ii) a relevant interest in 20% or more of Shares, or a right to acquire any such relevant interest; 

(b) acquiring control (as determined in accordance with section 50AA of the Corporations Act) of Mesoblast; 

(c) otherwise acquiring or merging with Mesoblast; 

Corporations Act means the Corporations Act 2001 (Cth); 

Deed means this Deed including the recitals, any schedules and any annexures; 

Government Agency includes any government, or any government, semi-government or judicial agency or authority; 

Mesoblast Board means the Board of Directors of Mesoblast; Mesoblast Group means Mesoblast and its related bodies corporate;
related body corporate has the meaning given to that term in the Corporations Act; relevant interest has the meaning given to that term in the Corporations Act; 

  
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 Shares means fully paid ordinary shares in the capital of Mesoblast; 

Subscription Amount means the aggregate Subscription Price per Share for the issue of all of the Subscription Shares being equal to the
number of Subscription Shares multiplied by the Issue Price; 
 Subscription Price means a price per Subscription Share being the
lesser of (a) A$ Au$110,601,295 divided by the total Subscription Shares and (b) $4.35; and 
 Subscription Shares means a
number of Shares equal to 19.99% of the issued Shares (after the issue of the Subscription Shares) less that number of Shares already issued to Cephalon under the Merger Agreement. 

1.2 Interpretation. In this Deed, unless the context requires otherwise: 

(a) the singular includes the plural and vice versa and a gender includes the other genders; 

(b) the headings are used for convenience only and do not affect the interpretation of this Deed; 

(c) other grammatical forms of defined words or expressions have corresponding meanings; 

(d) the word “person” includes a natural person and anybody or entity whether incorporated or not; 

(e) the words “in writing” include any communication sent by letter or facsimile transmission; 

(f) a reference to all or any part of a statute, rule, regulation or ordinance (statute) includes that statute as amended,
consolidated, re-enacted or replaced from time to time; 
 (g) wherever “include” or any form of that word is used, it must be
construed as if it were followed by “(without being limited to)”; and 
 (h) a reference to any agency or body, if that agency or
body ceases to exist or is reconstituted, renamed or replaced or has its powers or functions removed (defunct body), means the agency or body which performs most closely the functions of the defunct body. 

2. Issue of Subscription Shares 

2.1 Application for Subscription Shares. Cephalon by executing this Deed agrees to subscribe for and Mesoblast agrees to issue the
Subscription Shares on the terms and conditions of this Deed. Cephalon’s agreement to subscribe for the Subscription Shares is irrevocable and, except as otherwise provided by this Deed, unconditional. 

  
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 2.2 Subscriber’s obligations. Cephalon must by 3:00pm AEDST on the Completion Date
pay (in cleared funds) the Subscription Amount to Mesoblast by bank cheque or electronic funds transfer to an account nominated by Mesoblast. 

2.3 Mesoblast’s obligations. Subject to compliance by Cephalon with clause 2.2, Mesoblast must, on the Completion Date: 

(a) allot and issue the Subscription Shares to Cephalon, including by causing Mesoblast’s share registry to register Cephalon as the
holder of the Subscription Shares; 
 (b) apply for and do everything the ASX reasonably requires to obtain quotation of the Subscription
Shares; and 
 (c) deliver or cause to be delivered to Cephalon a holding statement for the Subscription Shares. 

2.4 Constitution. Cephalon agrees to be bound by and to hold the Subscription Shares subject to the terms of Mesoblast’s
Constitution (as amended from time to time). 
 2.5 Cleansing notice. If on the Completion Date: 

(a) the requirements of section 708A(5)(a), (b), (c) and (d) of the Corporations Act are satisfied in relation to Mesoblast and the
existing issued Shares (as applicable); 
 (b) Mesoblast has complied with: 

(i) the provisions of Chapter 2M of the Corporations Act as they apply to Mesoblast; and 

(ii) section 674 of the Corporations Act; and 

(iii) there is no determination in force under section 708A(2) of the Corporations Act, Mesoblast must, on the Completion Date, issue a
notice in accordance with section 708A(5)(e) of the Corporations Act (cleansing statement) in relation to the Subscription Shares issued on the Completion Date. 

2.6 Disclosure document. If any of the requirements referred to in clause 2.5 will not be satisfied on the Completion Date: 

(a) Mesoblast must so notify Cephalon before the Completion Date promptly upon becoming aware that such requirements will not be satisfied;
and 
 (b) Mesoblast must as soon as reasonably practicable issue a disclosure document which complies with Part 6D.2 of the Corporations
Act (disclosure document) on or prior 

  
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to the Completion Date (which shall be postponed to such date notified by Mesoblast to Cephalon with the notification given under paragraph (a) as will give Mesoblast sufficient time to
prepare and issue the disclosure document) so that Cephalon will not be subject to any on-sale restrictions in respect of such Shares under section 707(3) of the Corporations Act. 

Mesoblast’s obligation to issue a disclosure document in accordance with this clause 2.6 is subject to Cephalon and its directors (if
applicable) giving the consent required under section 720 of the Corporations Act. Mesoblast must do everything reasonably required by Cephalon (in accordance with customary procedures and practice) to facilitate Cephalon and its directors (if
applicable) giving such consent. 
 3. Precondition to the issue of the Subscription Shares 

3.1 Conditions precedent. The issue of the Subscription Shares by Mesoblast to Cephalon is conditional on: 

(a) Mesoblast obtaining the approval of its Shareholders for the purposes of ASX Listing Rule 7.1; 

(b) no objection being received and the period of 30 days expiring (or earlier terminated) from the date of the filing by Mesoblast and
Cephalon of a merger / acquisition notification (HSR filing) as required under the US Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended; and 

(c) the Treasurer of the Commonwealth of Australia either: 

(i) issues a notice stating that the Commonwealth Government does not object to the proposed acquisition of the Subscription Shares by
Cephalon, either without conditions or with conditions that Cephalon considers acceptable (acting reasonably); or 
 (ii) becomes, or is,
precluded under the Foreign Acquisitions and Takeovers Act 1975 (Cth) from making an order in respect of the proposed acquisition of the Subscription Shares by Cephalon, in each case on or before 28 February 2011 or any other date agreed
by Mesoblast and Cephalon in writing. 
 3.2 Duties in relation to Conditions Precedent. 

(a) Each party must use its reasonable endeavours to ensure that the Conditions Precedent are fulfilled on or before the date specified in
that clause. 
 (b) Without limiting the generality of paragraph (a), Mesoblast must use reasonable endeavours to convene a meeting of
Shareholders to consider the Shareholders’ approval required by the Condition Precedent in clause 3.1(a), including by dispatching the Notice of Meeting by no later than 15 January 2011. 

  
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 (c) Each party must: 

(i) supply the other with all information and documents necessary or desirable for the purpose of enabling either the other party or for
fulfilment of each Condition Precedent; and 
 (d) Without limiting the generality of paragraph (c), Cephalon must promptly provide
Mesoblast with such information in relation to Cephalon and the Cephalon Group (Cephalon Information) as is reasonably required for the purposes of any disclosure that must be included in the Notice of Meeting or the HSR filing. 

(e) Mesoblast must consult with Cephalon as to the content and presentation of the Notice of Meeting and must: 

(i) provide to Cephalon successive drafts of the Notice of Meeting and of any other document which it is proposed will accompany the Notice
of Meeting to enable Cephalon to review and comment on those drafts; 
 (ii) take all comments made by Cephalon into account in good faith
when producing revised drafts of the Notice of Meeting and any accompanying documents; 
 (iii) before issuing the final Notice of Meeting
and any accompanying documents, obtain Cephalon’s written approval for the form and content in which the Cephalon Information appears in those documents; 

(iv) keep Cephalon informed of any issues raised by the ASX or any other person about the Notice of Meeting or generally the transactions to
be given effect by this Deed and take into account in good faith in resolving such issues any matters raised by Cephalon. 
 (f) If the
parties are unable to agree on the final form of the Notice of Meeting and any accompanying documents, the final form and content shall be determined by Mesoblast acting reasonably but if Cephalon disagrees with such form and content: 

(i) Mesoblast must include a statement to that effect in the Notice of Meeting; and 

(ii) if the failure to agree relates to the Cephalon Information or any other information concerning the Cephalon Group, Mesoblast must
include a statement that Cephalon takes no responsibility for the relevant form and content to the extent that Cephalon disagrees with it. 

3.3 Failure of Conditions Precedent. Either party may, if not otherwise in breach of this Deed, terminate the obligation on the parties
to proceed with the issue of the Subscription Shares in accordance with clause 2 of this Deed by giving written notice to all other party at any time before Completion if the Conditions Precedent are not satisfied before 5.00 pm AEST on the date
specified in clause 3.1. 

  
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 3.4 No Share issues pending satisfaction of Conditions Precedent. Mesoblast represents and
warrants to Cephalon that Mesoblast does not foresee the need for any additional capital or other funding during the period from the execution of this agreement and the date by which each Condition Precedent must be satisfied or the obligation on
the parties to proceed with the issue of the Subscription Shares in accordance with clause 2 is terminated under clause 3.3 (the Condition Satisfaction Period) beyond the funding to be received by Arigioblast from Cephalon pursuant to the
licence agreement referred to in recital B. Accordingly, during the Condition Satisfaction Period, Mesoblast must not issue any Shares other than under any employee or Director Share or option plan or remuneration arrangements for employees or
Directors (including upon the exercise of options granted under such arrangements). 
 4. Standstill obligation 

4.1 Not to acquire any interest in further Shares. Subject to clause 4.3, Cephalon agrees that for a period of 12 months from the date
of this Deed it will not and it will procure that its Cephalon Associates do not: 
 (a) acquire or obtain any right, title or interest of
any nature whatever in any further Shares or securities capable of conversion into Shares or which give substantially the economic benefit of Shares; or 

(b) enter into any arrangement, understanding or agreement with any party concerning Shares or securities capable of conversion into Shares
which give substantially the economic benefit of Shares, which in aggregate would give Cephalon a relevant interest in Shares of more than 19.99%. For the purpose of clarity in the event of any dilutive issue (including without limitation those
matters referred to in clause 7.3 below) which as a consequence results in Cephalon’s relevant interest being less than 19.99%, Cephalon can buy (on market or off market) from any Mesoblast shareholder which in aggregate would give Cephalon a
relevant interest in Shares of more than 19.99%. 
 4.2 Not to announce or make any Takeover Offer or like action. Subject to clause
4.3, Cephalon agrees that for a period of 12 months from the date of this Deed it will not and it will ensure that its Cephalon Associates do not announce or make any takeover offer or like corporate action to offer to acquire any right, title or
interest in further Shares other than in respect of the Shares to be issued to Cephalon under the Merger Agreement or, where the Condition Precedent is satisfied under clause 2 of this Deed, the Shares to be issued under this Deed. 

4.3 Third Party Control Proposals. Clauses 4.1 and 4.2 cease to apply if: 

(a) any person (other than Cephalon or a Cephalon Associate) announces or makes any Control Proposal; or 

(b) Mesoblast announces that it is in any discussions with any person (other than Cephalon or a Cephalon Associate) concerning a Control
Proposal. 
 4.4 No action to cause classification as Controlled Foreign Corporation. Cephalon agrees that it will take no action
which is reasonably likely to result in Mesoblast being classified or treated as a controlled foreign corporation for the purpose of the taxation laws of the United States. 

  
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 5. Parties’ Acknowledgments and Representations 

5.1 Cephalon’s acknowledgments. Cephalon acknowledges that: 

(a) the issue of the Subscription Shares to Cephalon does not (except pursuant to clause 2.5 or clause 2.6) require a disclosure document,
prospectus or like registerable document to be prepared by Mesoblast pursuant to any applicable legislation and therefore Cephalon has not received that information which would otherwise be available to a potential investor in such a document; 

(b) Cephalon has investigated all material matters that a prudent intending subscriber for the Subscription Shares would investigate and has
satisfied itself about anything arising from its investigation (but having regard to Mesoblast’s representations and warranties in clauses 5.2 and 5.3); 

(c) it has received independent professional advice in relation to the subscription for the Subscription Shares (including legal, accounting,
tax and financial advice), has satisfied itself about anything arising from that advice and is able to evaluate the risks and merits of subscribing for the Subscription Shares; 

(d) an investment in the Subscription Shares is speculative and there is no guarantee that there will be any return on holding the
Subscription Shares, any class of shares in Mesoblast or Mesoblast itself (whether by way of dividends or return of capital or any other manner whatever); 

(e) apart from Mesoblast’s representations and warranties in clauses 5.2 and 5.3, neither Mesoblast, nor its officers, agents or
advisers, have made any representation or warranty of any kind whatever in connection with this Deed, Mesoblast, its financial position or trading in shares of any class in Mesoblast; and 

(f) apart from Mesoblast’s representations and warranties in clauses 5.2 and 5.3, to the fullest extent permitted by law, all terms,
conditions, undertakings, inducements, warranties or representations (whether express or implied, statutory or otherwise), which relate to or are connected with terms of this Deed are excluded. 

5.2 Mutual Representations and Warranties. Each party represents and warrants to the other, as an inducement to the other to enter into
this Deed and to subscribe for or issue the Subscription Shares that: 
 (a) it has full and lawful authority to execute and deliver this
Deed and to perform, or cause to be performed, its obligations under this Deed; 

  
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 (b) apart from the Condition Precedent, it has taken all action required and obtained or been
granted all consents, approvals, permissions and authorisations, whether internal or external, necessary to enable it to enter into and perform its obligations under this Deed; 

(c) the execution, delivery and performance of this Deed will not contravene: 

(i) any law, regulation, order, judgment or decree of any court or Government Agency which is binding on it or any of its property; 

(ii) any provision of its constitution or equivalent documents; or 

(iii) any agreement, undertaking or instrument which is binding on the party or any of its property. 

5.3 Mesoblast’s Representations and warranties. Mesoblast represents and warrants to Cephalon, as an inducement to Cephalon to
enter into this Deed and to subscribe for the Subscription Shares that: 
 (a) Mesoblast has complied with its obligations under ASX
Listing Rule 3.1 and, other than as fairly disclosed to Cephalon, is not relying on ASX Listing Rule 3.1A to withhold information from disclosure; and 

(b) Mesoblast has complied with its obligations under Chapter 2M of the Corporations Act. 

6. Director Appointment 

6.1 Appointment of Cephalon Nominee. Having regard to the matters described in recital B, Mesoblast agrees to procure that the
Mesoblast Board upon the execution of this Deed appoints Mr. Kevin Buchi, being a person nominated by Cephalon, as a Director of Mesoblast (the Cephalon Nominee). 

6.2 Other Directors. Clause 6.1 does not limit Cephalon’s rights as a Shareholder to nominate for election or vote for or against
the election or re-election of any Director or proposed Director of Mesoblast (in addition to the Cephalon Nominee) at any general meeting of Mesoblast Shareholders. 

6.3 Disclosure of Information by Cephalon Nominee to Cephalon. Having regard to the benefits to Mesoblast of having Cephalon’s
contribution through the Cephalon Nominee to the deliberations of the Mesoblast Board, Mesoblast agrees that the Cephalon Nominee may provide information obtained by the Cephalon Nominee as a Director of Mesoblast to Cephalon, officers of Cephalon
or Cephalon, Inc. and the advisers to Cephalon or Cephalon, Inc., subject to: 
 (a) Cephalon ensuring that any such information which is
confidential is not further disclosed unless required by law (including pursuant to an order, rule, regulation or policy of any Government Agency or securities exchange or stock market) and then only to the extent so required and after consulting
with Mesoblast to the extent practicable; 

  
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 (b) such information not being used for any purpose other than to obtain Cephalon’s
contribution through the Cephalon Nominee to the deliberations of the Mesoblast Board, except where there is an actual conflict of interest between Cephalon and Mesoblast in respect of a particular matter and the information relates to that matter
(in which case the relevant information must remain confidential and the Cephalon Nominee may, at the discretion of the other members of the Mesoblast Board, be excluded from deliberations in relation to that matter if required by section 195 of the
Corporations Act). 
 6.4 Disclosure of Financial Information to Cephalon. Mesoblast (in this clause 6.4 referred to as the
Company) must: 
 (a) deliver to Cephalon as soon as practicable, but in any event within ninety (90) days after the end of
each fiscal year of the Company, a consolidated income statement for such fiscal year, a consolidated balance sheet as of the end of such year and a consolidated cash flow statement for such fiscal year, such year-end financial reports to be in
reasonable detail, prepared in accordance with applicable generally accepted accounting principles consistently applied, and audited and certified by independent public accountants of nationally recognized standing selected by the Company, and
additionally, the Company shall deliver a draft of such year-end financial reports to Cephalon as soon as practicable, but in any even within seventy-five (75) days after the end of each fiscal year of the Company; 

(b) deliver to Cephalon as soon as practicable, but in any event within fifteen (15) days after the end of each of the quarter of each
fiscal year of the Company, an unaudited consolidated profit or loss statement for such fiscal quarter, an unaudited consolidated balance sheet as of the end of such fiscal quarter and an unaudited consolidated cash flow statement for such fiscal
quarter; 
 (c) in the event Cephalon is required to incorporate its share of Mesoblast result in its profit and loss, MSB will provide an
unaudited profit and loss, unaudited balance sheet, and unaudited cashflow within seven (7) business days after the end of every month; 

(d) deliver to Cephalon as soon as practicable, but in any event prior to the end of each fiscal year, a budget and business plan for the
Company’s 2011 fiscal year and each fiscal year thereafter, prepared on a monthly basis, including balance sheets and sources and applications of funds statements for such months and, within five (5) business days after presentation to the
Company’s Board of Directors, any other budgets or revised budgets prepared by the Company; 
 (e) deliver to Cephalon as soon as
reasonably practicable, additional supporting financial information as mutually agreed upon by Cephalon and the Company; 
 (f) deliver to
Cephalon, with respect to the audited financial statements called for in subsection (i) and the unaudited financial statements called for in subsection (ii) of this 

  
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Section 6.4(b) and 6.4(c), an instrument executed by the chief financial officer or chief executive officer of the Company, certifying that such financials were prepared in accordance with
International Financial Reporting Standards and generally accepted accounting principles consistently applied with prior practice for earlier periods and fairly present, in all material respects, the consolidated financial condition of the Company
and its results of operation for the period specified, subject to year-end audit adjustments and, in the case of the financial statements called for in subsection (ii) of this Section 5.1(b), footnotes; 

(g) provide Cephalon, and/or Cephalon’s auditors’, financial records and financial information that are required for Cephalon to
prepare its audited financial statements or for Cephalon’s auditors to review, audit or perform other procedures on Cephalon’s financial statements. Cephalon and Cephalon’ auditors shall only be required to provide reasonable advance
notice of such requirements, and such requirements shall only be made to the extent reasonably necessary to enable Cephalon to prepare all of its statutory financial reporting statements in accordance with the rules of any exchange on which its
securities are traded or generally in accordance with its reporting obligations under International Financial Reporting Standards. 
 (h)
Cephalon will hold and will procure that Cephalon’s officers, employees and authorized representatives of Cephalon (including independent public accountants and attorneys) will hold, any information obtained pursuant to this Section 5.1 in
strict confidence (it being understood that Cephalon shall be permitted to disclose such information to the extent required by applicable requirements of law or the rules of any applicable securities exchange). 

7. Top-up Right 
 7.1
Future Placements. Subject to clauses 7.2, 7.3 and 7.4, if Mesoblast proposes in the future to make a placement of Shares or to issue Shares on the conversion of securities convertible into Shares (each, Placement Shares) then Mesoblast
must offer to Cephalon the right (top-up right) to subscribe for additional Shares on the same terms and, to the extent reasonably practicable, at precisely the same time as Mesoblast proposes to issue such other Shares in such number as
would, upon the issue of the Placement Shares and the Shares issued to Cephalon, result in Cephalon’s percentage Shareholding being maintained at the same percentage as Cephalon had immediately prior to such issue. 

7.2 Sell down by Cephalon. Clauses 6 and 7.1 does not apply if Cephalon ceases to have a relevant interest (as defined in the
Corporations Act) in less than 10% of the issued Shares. 
 7.3 Excluded Issues. Clause 7.1 does not apply in relation to any Shares
issued by Mesoblast: 
 (a) under any employee or Director Share or option plan or remuneration arrangements for employees or Directors
(including upon the exercise of options granted under such arrangements); or 
 (b) under a dividend reinvestment plan; or 

  
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 (c) pursuant to an acquisition agreement or like arrangement to acquire another entity or assets
(whether by acquisition, license or other like arrangement). 
 7.4 ASX Waiver. The top-up right referred to in clause 7.1 is
conditional on the ASX granting a waiver of ASX Listing Rule 6.18. Mesoblast must use reasonable endeavours to obtain such a waiver as soon as possible and must: 

(a) provide to Cephalon drafts of the waiver application to enable Cephalon to review and comment on those drafts; 

(b) take all comments made by Cephalon into account in good faith when producing revised drafts of waiver application; 

(c) keep Cephalon informed of any issues raised by the ASX or any other person about the waiver and take into account in good faith in
resolving such issues any matters raised by Cephalon. 
 In the event that the ASX requires an adjustment to the terms of the top-up right
as a condition of the waiver, and such adjustment is acceptable to Cephalon, the parties must adjust the terms of the top-up right as so required. 

7.5 No ASX waiver. If the ASX does not grant the waiver referred to in clause 7.1, Mesoblast agrees that it will not issue additional
Shares for a period of 12 months from the Completion Date other than: 
 (a) under any employee or Director Share or option plan or
remuneration arrangements for employees or Directors (including upon the exercise of options granted under such arrangements); or 
 (b)
under a dividend reinvestment plan; or 
 (c) pursuant to an acquisition agreement or like arrangement to acquire another entity or assets
(whether by acquisition, license or other like arrangement). 
 8. Public Announcement. Immediately after the execution of this Deed,
Mesoblast must make the announcement to the ASX which is set out in Annexure A. 
 9. GST 

9.1 GST Gross-Up. If a party (supplier) is required to pay GST in respect of a supply made under or in connection with
(including by reason of a breach of) this Deed, the recipient of the supply must (in addition to any other payment for, or in connection with, the supply) pay to the supplier an amount equal to such GST (GST gross-up). 

9.2 GST Invoice. If a GST gross-up is payable, then the supplier must give the recipient a tax invoice for the supply. 

  
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 9.3 Payment. Provided a tax invoice has been given, the GST gross-up must be paid by the
recipient: 
 (a) if any monetary consideration is payable for the supply, at the same time and in the same manner as such monetary
consideration; 
 (b) if no monetary consideration is payable for the supply within 10 Business Days after the day on which the tax invoice
is given. 
 9.4 Reimbursement. If any payment to be made to a party under or in connection with this Deed is a reimbursement or
indemnification of an expense or other liability incurred or to be incurred by that party, then the amount of the payment must be reduced by the amount of any input tax credit to which that party is entitled for that expense or other liability, such
reduction to be effected before any increase in accordance with clause 8.1. 
 9.5 Adjustments. If an adjustment event has occurred
in respect of a supply made under or in connection with this Deed, any party that becomes aware of the occurrence of that adjustment event must notify the other party as soon as practicable, and the parties agree to take whatever steps are necessary
(including to issue an adjustment note), and to make whatever adjustments are required, to ensure that any GST or additional GST on that supply, or any refund of GST (or part thereof), is paid no later than 20 Business Days after the supplier first
becomes aware that the adjustment event has occurred. 
 9.6 Definitions. 

(a) Terms used in this clause 8 which are defined in the A New Tax System (Goods and Services Tax) Act 1999 (Cth) have the meaning
given to them in that Act. 
 (b) In this clause 8, a reference to a payment includes any payment of money and any form of consideration
other than payment of money. 
 (c) In this Deed, all references to payments and obligations to make payments, including all references to
compensation (including by way of reimbursement or indemnity), are, but for the operation of this clause, exclusive of GST. 
 10.
General 
 10.1 Time of the Essence. In this Deed, time is of the essence unless otherwise stipulated. 

10.2 Entire Understanding. This Deed and all documents referred to in this Deed contain the entire understanding between the parties
concerning the subject matter of the Deed and supersede all prior communications between the parties. Each party acknowledges that, except as expressly stated in this Deed, that party has not relied on any representation, warranty or undertaking of
any kind made by or on behalf of the other party in relation to the subject matter of this Deed. 

  
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 10.3 No Adverse Construction. No Deed is not to be construed to the disadvantage of
a party because that party was responsible for its preparation. 
 10.4 Further Assurances. A party, at its own expense and
within a reasonable time of being requested by another party to do so, must do all things and execute all documents that are reasonably necessary to give full effect to this Deed. 

10.5 No Waiver. A failure, delay, relaxation or indulgence by a party in exercising any power or right conferred on the party by this
Deed does not operate as a waiver of the power or right. A single or partial exercise of the power or right does not preclude a further exercise of it or the exercise of any other power or right under this Deed. A waiver of a breach does not operate
as a waiver of any other breach. 
 10.6 Severability. If any provision of this Deed offends any law applicable to it and is as a
consequence illegal, invalid or unenforceable then: 
 (a) where the offending provision can be read down so as to give it a valid and
enforceable operation of a partial nature, it must be read down to the minimum extent necessary to achieve that result; and 
 (b) in any
other case the offending provision must be severed from this Deed, in which event the remaining provisions of the Deed operate as if the severed provision had not been included. 

10.7 Successors and Assigns. This Deed binds and benefits the parties and their respective successors and permitted assigns under
clause 10.8. 
 10.8 No Assignment. A party cannot assign or otherwise transfer the benefit of this Deed without the prior written
consent of each other party. 
 10.9 Consents and Approvals. Where anything depends on the consent or approval of a party then,
unless this Deed provides otherwise, that consent or approval may be given conditionally or unconditionally or withheld, in the absolute discretion of that party. 

10.10 No Variation. This Deed cannot be amended or varied except in writing signed by the parties. 

10.11 Costs. Each party must pay its own legal costs of and incidental to the preparation and completion of this Deed. 

10.12 Governing Law and Jurisdiction. This Deed is governed by and must be construed in accordance with the laws in force in the State
of Victoria, Australia. The parties submit to the exclusive jurisdiction of the courts of that State and Australia in respect of all matters arising out of or relating to this Deed, its performance or subject matter. 

10.13 Counterparts. If this Deed consists of a number of signed counterparts, each is an original and all of the counterparts together
constitute the same document. 

  
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 10.14 Conflicting Provisions. If there is any conflict between the main body of this Deed
and any schedules or annexures comprising it, then the provisions of the main body of this Deed prevail. 
 10.15 Non Merger. No
provision of this Deed merges on completion of the subscription by Cephalon for the Subscription Shares. A term or condition of, or act done in connection with, this Deed does not operate as a merger of any of the rights or remedies of the parties
under this Deed and those rights and remedies continue unchanged. 
 10.16 No Right of Set-off. Unless this Deed expressly provides
otherwise, a party has no right of set-off against a payment due to another party. 
 10.17 Relationship of Parties. Unless this Deed
expressly provides otherwise, nothing in this Deed may be construed as creating a relationship of partnership, of principal and agent or of trustee and beneficiary. 

10.18 Notices. Each communication (including each notice, consent, approval, request and demand) under or in connection with this Deed:

 (a) must be in writing; 

(b) must be addressed as follows (or as otherwise notified by that party to each other party from time to time): 

        Mesoblast 

        Mesoblast Limited 

        Level 39, 55 Collins Street, 

        Melbourne, Victoria 3000, Australia 

        Fax: 

        For the attention of:     Company Secretary 

        CEPHALON 

        Cephalon International Holdings, Inc., 

        c/o Johnson Winter & Slattery 

        Level 30, 264 George Street, 

        Sydney, New South Wales, 2000 

        Fax:    +61 2 8274 9500 

        For the attention of:    Mr. Damian Reichel 

(c) must be signed by the party making it or (on that party’s behalf) by the solicitor for, or any attorney, director, secretary or
authorized agent of, that party; 
 (d) must be delivered by hand or posted by prepaid post to the address, or sent by fax to the number,
of the addressee, in accordance with clause 10.18(b); and 

  
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 (e) is taken to be received by the addressee: 

(i)(in the case of prepaid post sent to an address in the same country) on the third day after the date of posting; 

(ii)(in the case of prepaid post sent to an address in another country) on the fifth day after the date of posting by airmail; 

(iii)(in the case of fax) at the time in the place to which it is sent equivalent to the time shown on the transmission confirmation report
produced by the fax machine from which it was sent; and 
 (iv)(in the case of delivery by hand) on delivery, 

but if the communication is taken to be received on a day that is not a Business Day or after 5.00 pm, it is taken to be received at 9.00 am on the next
Business Day. 

  
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 Executed as a Deed 
  

					
	Executed by Mesoblast Limited ACN 109				
	431 870 in accordance with section 127 of the Corporations Act 2001 (Cth)				
			
	 /s/ Brian Jamieson
				 /s/ Kevin Hollingsworth

	Signature of Director				Signature of Secretary
			
	 Brian Jamieson
				 Kevin Hollingsworth

	Name of Director (please print)				Name of Secretary (please print)
			
	Executed by Cephalon International Holdings, Inc. by its duly authorised representative/s:				
			
	  
				  

	Signature of Director				Signature of Director/Secretary
			
	  
				  

	Name of Director (please print)				Name of Director/Secretary (please print)