Committee for the “Zeus” Transaction
the Board of Directors
Atlantic Avenue, #102
have requested our opinion (the “Opinion”), as investment bankers, as to the fairness from a financial point of view
to the holders of the outstanding Common Shares of BioTime, Inc. (“BioTime” or the “Company”) of the offer
to be paid to Asterias Biotherapeutics, Inc. (“Asterias” or the “Target”), pursuant to the terms of the
merger agreement (“Merger Agreement”) by and among BioTime, Asterias, and Acquisition Sub (hereafter BioTime, Asterias,
and Merger Sub are referred to herein as the “Parties”). The terms and conditions of the Transaction (as defined below)
are set forth in the Merger Agreement, a form which has been provided to Maxim by BioTime. Pursuant to the Merger Agreement: (i)
Each outstanding share of Asterias Series A common stock (“Asterias Common Stock”) issued and outstanding immediately
prior to the Effective Time will be automatically converted into the right to receive 0.71 (the “Exchange Ratio”)
voting common shares, no par value, of BioTime (“BioTime Common Shares”). (ii) Each fractional share of BioTime stock
after the exchange, pursuant to the Exchange Ratio, will receive cash consideration in lieu of common stock. (iii) From and after
the Effective Time, all such shares of Asterias Common Stock will no longer be outstanding and will automatically be cancelled
and will cease to exist, and each applicable holder of such shares of Asterias Common Stock will cease to have any rights with
respect thereto (the “Transaction”). The Opinion is based upon, among the other maters addressed herein, the parameters,
assumptions and calculations set forth in the presentation concurrently delivered to the Board. The Opinion is also subject to
the following assumptions, conditions, qualifications, notices and disclaimers.
Group LLC (“Maxim”) provides a multitude of financial services including investment banking; private wealth management;
and global institutional equity, fixed-income and derivatives sales and trading as well as equity research. Maxim and its affiliates,
or other related entities or individuals, may at any time purchase, sell, hold or vote long or short positions and investments
in securities, derivatives, loans, commodities, currencies, credit default swaps and other financial instruments of the Company,
and any of their respective affiliates and third parties, or any currency or commodity that may be involved in the Transaction.
Maxim will receive a fee from the Company for delivering the Opinion as well as reimbursement of certain expenses. Maxim’s
fee will be due in its entirety upon the delivery of the Opinion, irrespective of whether the Transaction is completed. The Company
has agreed to indemnify Maxim against certain liabilities, and to reimburse it for certain liabilities in connection with Maxim
providing the Opinion. No controlling person of Maxim is directly personally receiving compensation or other remuneration from
any of the Parties.
connection with the Opinion, we have reviewed, including but not limited to, the following information/documents: the Merger Agreement,
Annual Reports on Form 10-K of the Company and Asterias; certain interim reports to stockholders and Quarterly Reports on Form
10-Q of the Company and Asterias; business agreements; and certain internal financial analyses and forecasts for Asterias prepared
by BioTime management team and Asterias management, as approved for our use by the Company as the case may be (the “Forecasts”).
We reviewed the reported price and trading activity for the Securities; compared certain financial and stock market information
for the Company with similar information for certain other companies the securities of which are publicly traded; reviewed the
financial terms of certain recently closed strategic transactions, business combinations, and acquisitions within the Biotechnology
industry. In rendering the Opinion, we have assumed that the definitive Merger Agreement will not differ materially from the draft
that we reviewed, and that there will be no change to the contemplated structure of the Transaction by the Parties or reduction
of the Exchange Ratio, number of shares of Common Stock subject to the Offer or any Offer Condition otherwise amended or modified
in any way adverse to the holders of BioTime Common Shares.