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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No.          )

Filed by the Registrant ý

Filed by a Party other than the Registrant o

Check the appropriate box:

ý

 

Preliminary Proxy Statement

o

 

Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))

o

 

Definitive Proxy Statement

o

 

Definitive Additional Materials

o

 

Soliciting Material under §240.14a-12

 

FIBROCELL SCIENCE, INC.

(Name of Registrant as Specified In Its Charter)

 

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

o

 

No fee required.

ý

 

Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
    (1)   Title of each class of securities to which transaction applies:
Common stock, par value $0.001 per share, of Fibrocell Science, Inc.
 
    (2)   Aggregate number of securities to which transaction applies:
The maximum number of shares of common stock to which this transaction applies is estimated to be 17,415,938, which consists of (i) 9,758,332 shares of common stock, (ii) 361,500 shares of common stock underlying options to purchase shares of common stock with an exercise price less than the per share merger consideration of $3.00 per share, (iii) 760,000 shares of common stock issuable upon conversion of convertible preferred stock, (v) 2,486,820 shares of common stock underlying warrants to purchase shares of common stock with an exercise price less than the per share merger consideration of $3.00 per share, and (vi) 4,128,673 shares of common stock underlying warrants to purchase common stock with an exercise price above the per share merger consideration of $3.00 per share for which the holders are eligible to receive the Black-Scholes value of such warrants.
 
    (3)   Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined):
In accordance with Section 14(g) of the Securities Exchange Act of 1934, as amended, the filing fee was determined by multiplying 0.0001298 by the underlying value of the transaction of $36,855,870, which has been calculated as the sum of: (a) the product of 9,758,332 shares of common stock and the per share merger consideration of $3.00 per share; plus (b) the product of (i) 361,500 shares of common stock underlying options to purchase shares of common stock with an exercise price less than the per share merger consideration of $3.00 per share, and (ii) the difference between $3.00 and the weighted average exercise price of such options of $1.88; plus (c) the product of 760,000 shares of common stock issuable upon conversion of convertible preferred stock and the per share merger consideration of $3.00 per share; plus (d) the product of (i) 2,486,820 shares of common stock underlying warrants to purchase shares of common stock with an exercise price less than the per share merger consideration of $3.00 per share and (ii) the difference between $3.00 and the weighted average exercise price of such warrants of $2.80; plus (e) $4,398,630, the approximate aggregate Black-Scholes value of the 4,128,673 warrants to purchase common stock with an exercise price above the per share merger consideration of $3.00 per share for which the holders are eligible to receive the Black-Scholes value of such warrants.
 
    (4)   Proposed maximum aggregate value of transaction:
$36,855,870
 
    (5)   Total fee paid:
$4,783.89
 

o

 

Fee paid previously with preliminary materials.

o

 

Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.

 

 

(1)

 

Amount Previously Paid:
        
 
    (2)   Form, Schedule or Registration Statement No.:
        
 
    (3)   Filing Party:
        
 
    (4)   Date Filed:
        
 

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PRELIMINARY PROXY STATEMENT—SUBJECT TO COMPLETION
DATED OCTOBER 11, 2019

LOGO

405 Eagleview Blvd.
Exton, Pennsylvania 19341
(484) 713-6000

                , 2019

Dear Stockholders:

         On September 12, 2019, Fibrocell Science, Inc. ("Fibrocell"), Castle Creek Pharmaceutical Holdings, Inc. ("Castle Creek"), and Castle Creek Merger Corp. ("Merger Sub") entered into an Agreement and Plan of Merger (as amended from time to time, the "Merger Agreement"), providing for the acquisition of Fibrocell by Castle Creek. Pursuant to the terms of the Merger Agreement, Merger Sub, a wholly-owned subsidiary of Castle Creek, will merge with and into Fibrocell (the "Merger"), with Fibrocell surviving the Merger as a wholly-owned subsidiary of Castle Creek.

         If the Merger is completed, stockholders will have the right to receive $3.00 in cash, without interest and less any applicable withholding taxes, for each share of common stock, par value $0.001 per share, of Fibrocell ("Common Stock") that they own immediately prior to the effective time of the Merger (the "Effective Time").

         You are cordially invited to a special meeting of stockholders (the "Special Meeting") to be held at the offices of Hogan Lovells US LLP located at 1735 Market St., Floor 23, Philadelphia, PA 19103 on                , 2019, at                , Eastern Time. The Special Meeting is being held for you to consider and vote on a proposal to adopt the Merger Agreement and related matters. Your vote is important. Whether or not you expect to attend the meeting, we encourage you to vote your shares as promptly as possible in order to make certain that you are represented at the meeting. You may vote over the Internet, as well as by telephone or by mailing a proxy or voting instruction card. If you are a "street name" holder (a holder whose shares are held through a broker, bank, trust company or other nominee), in order for your shares to be represented at the Special Meeting, you should instruct your broker, bank, trust company or other nominee as to how to vote your shares by following the directions provided to you by your broker, bank, trust company or other nominee. The Merger cannot be completed unless the Merger Agreement is adopted by the affirmative vote of the holders of a majority of the outstanding shares of Common Stock as of the record date entitled to vote thereon. Therefore, your failure to vote, or failure to instruct your broker, bank, trust company or other nominee to vote, will have the same effect as a vote "AGAINST" the Merger.

         After careful consideration, the Fibrocell board of directors (the "Fibrocell Board"), on September 12, 2019, approved the Merger Agreement and determined that it is fair to, advisable and in the best interests of Fibrocell and its stockholders for Fibrocell to enter into the Merger Agreement and to effect the Merger and the other transactions contemplated thereby. The Fibrocell Board accordingly recommends that you vote "FOR" the adoption of the Merger Agreement and the other proposals described in the enclosed proxy statement.

         The obligations of Fibrocell and Castle Creek to complete the Merger are subject to the satisfaction or waiver of several conditions set forth in the Merger Agreement. The accompanying proxy statement provides you with detailed information about the Special Meeting, the Merger Agreement, the Merger and other important information related to the Merger. A copy of the Merger Agreement is enclosed as Annex A to the accompanying proxy statement. We encourage you to read the enclosed proxy statement and the Merger Agreement carefully and in their entirety.

         Thank you in advance for your consideration of this matter and continued support.

Sincerely,    

GRAPHIC

 

GRAPHIC

Douglas J. Swirsky
Chairman of the Board

 

John M. Maslowski
President and Chief Executive Officer

         Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of the Merger Agreement, passed upon the merits or fairness of the Merger or passed upon the adequacy or accuracy of the accompanying proxy statement. Any representation to the contrary is a criminal offense.

         The accompanying proxy statement is dated            , 2019, and is first being mailed to Fibrocell stockholders on or about            , 2019.


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YOUR VOTE IS IMPORTANT

        WHETHER OR NOT YOU PLAN TO ATTEND THE SPECIAL MEETING, WE URGE YOU TO VOTE YOUR SHARES VIA THE TOLL-FREE TELEPHONE NUMBER OR OVER THE INTERNET AS DESCRIBED IN THE PROXY MATERIALS. YOU MAY ALSO SIGN, DATE AND MAIL THE PROXY CARD IN THE PRE-PAID ENVELOPE PROVIDED. You may revoke your proxy or change your vote at any time before the Special Meeting. If your shares are held in the name of a broker, bank, trust company or other nominee, please follow the instructions provided to you by such broker, bank, trust company or other nominee, which is considered the stockholder of record, in order to vote. As a beneficial owner, you have the right to direct your broker, bank, trust company or other nominee on how to vote the shares in your account. Your broker, bank, trust company or other nominee cannot vote on any of the proposals, including the proposal to adopt the Merger Agreement, without your instructions.

        If you fail to return your proxy card, to grant your proxy electronically over the Internet or by telephone, or to vote by ballot in person at the Special Meeting, your shares will not be counted for purposes of determining whether a quorum is present at the Special Meeting. If you are a stockholder of record, voting in person by ballot at the Special Meeting will revoke any proxy that you previously submitted. If you hold your shares through a broker, bank, trust company or other nominee, you must obtain from the record holder a valid proxy issued in your name in order to vote in person at the Special Meeting.

        We encourage you to read the accompanying proxy statement, including all documents incorporated by reference into the accompanying proxy statement, and annexes to the accompanying proxy statement, carefully and in their entirety. If you have any questions concerning the Merger, the Special Meeting or the accompanying proxy statement, would like additional copies of the accompanying proxy statement or need help voting your shares of Common Stock, please contact our proxy solicitor:

GRAPHIC

Okapi Partners LLC
1212 Avenue of the Americas, 24th Floor
New York, New York 10036

Banks and Brokerage Firms, Please Call: (212) 297-0720
Stockholders and All Others Call Toll-Free: (877) 259-6290
Email: info@okapipartners.com


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PRELIMINARY PROXY STATEMENT—SUBJECT TO COMPLETION
DATED OCTOBER 11, 2019

LOGO

FIBROCELL SCIENCE, INC.

405 Eagleview Blvd.
Exton, Pennsylvania 19341



NOTICE OF SPECIAL MEETING OF STOCKHOLDERS



Date and Time:                   , 2019, at            , Eastern Time

Place:

 

Hogan Lovells US LLP
    1735 Market St., Floor 23, Philadelphia, PA 19103

Items of Business:

 

To consider and vote on a proposal to adopt the Agreement and Plan of Merger (as it may be amended from time to time, the "Merger Agreement"), dated as of September 12, 2019, by and among Fibrocell Science, Inc., a Delaware corporation (the "Company" or "Fibrocell"), Castle Creek Pharmaceutical Holdings, Inc., a Delaware corporation ("Castle Creek") and Castle Creek Merger Corp., a Delaware corporation and a wholly-owned subsidiary of Castle Creek ("Merger Sub"), a copy of which is attached as Annex A to the proxy statement accompanying this notice, pursuant to which Merger Sub will merge with and into Fibrocell, with Fibrocell surviving the Merger as a wholly-owned subsidiary of Castle Creek (which transaction is referred to as the "Merger"), and holders of common stock, par value $0.001 per share, of Fibrocell ("Common Stock") will be entitled to receive $3.00 in cash, without interest and less any applicable withholding taxes, for each share of Common Stock that they own immediately prior to the Effective Time of the Merger (referred to as the "Merger Proposal");

 

To consider and vote on a non-binding, advisory proposal to approve the compensation that will or may become payable to Fibrocell's named executive officers in connection with the Merger (referred to as the "Compensation Proposal"); and

 

To consider and vote on a proposal to approve one or more adjournments of the Special Meeting, if necessary or appropriate, to solicit additional proxies if there are not sufficient votes to approve the Merger Proposal at the then-scheduled date and time of the Special Meeting (referred to as the "Adjournment Proposal").


Record Date:

 

                , 2019

        Only holders of record of Common Stock at the close of business on the record date of the Special Meeting (the "Record Date") are entitled to notice of, and to vote at, the Special Meeting or any adjournment or postponement of the Special Meeting. Each share of Common Stock is entitled to one vote on each matter submitted to a vote at the Special Meeting. A complete list of stockholders


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entitled to vote at the Special Meeting will be available for examination by any stockholder for any purpose germane to the Special Meeting at our executive offices at 405 Eagleview Blvd., Exton, PA 19341 during ordinary business hours for a period of ten days before the Special Meeting. The list will also be available at the Special Meeting for examination by any stockholder present at the Special Meeting.

        Approval of the Merger Proposal requires the affirmative vote of the holders of a majority of the outstanding shares of Common Stock as of the Record Date entitled to vote thereon. Approval of the Compensation Proposal and the Adjournment Proposal each requires the affirmative vote of the holders of a majority of the shares of Common Stock present in person or represented by proxy at the Special Meeting and entitled to vote thereon. Your vote is important. Whether or not you expect to attend the meeting, we encourage you to vote your shares as promptly as possible in order to make certain that you are represented at the meeting. You may vote over the Internet, as well as by telephone or by mailing a proxy or voting instruction card. If you are a "street name" holder (a holder whose shares are held through a broker, bank, trust company or other nominee), in order for your shares to be represented at the Special Meeting, you should instruct your broker, bank, trust company or other nominee as to how to vote your shares by following the directions provided to you by your broker, bank, trust company or other nominee.

        If you return a properly executed proxy (including proxies received via the Internet or by telephone), but do not indicate how you wish to vote on a proposal, your shares of Common Stock represented by such proxy will be voted "FOR" any such proposal. If you attend the Special Meeting, you may revoke your proxy and vote in person if you wish, even if you have previously returned your proxy card or submitted your proxy by telephone or the Internet. Your prompt attention is greatly appreciated.

        Please note that if you hold shares in different accounts, it is important that you vote the shares represented by each account.

        The enclosed proxy statement provides detailed information about the Special Meeting, the Merger Agreement, the Merger and other important information related to the Merger. We urge you to read the enclosed proxy statement and the annexes carefully and in their entirety.

        Under Delaware law, Fibrocell stockholders who do not vote for the adoption of the Merger Agreement have the right to seek appraisal of the fair value of their shares as determined by the Delaware Court of Chancery instead of receiving the merger consideration, but only if they comply fully with all applicable requirements of Delaware law, which are summarized in the enclosed proxy statement. The enclosed proxy statement constitutes Fibrocell's notice to Fibrocell stockholders of the availability of appraisal rights in connection with the Merger, in compliance with the requirements of Section 262 of the Delaware General Corporation Law ("Section 262"). A copy of Section 262 is attached to the enclosed proxy statement as Annex C. Any Fibrocell stockholder seeking to demand appraisal, or wishing to preserve the right to do so, should review carefully Section 262 and the enclosed proxy statement.

        If you fail to return your proxy or to attend the Special Meeting in person, your shares will not be counted for purposes of determining whether a quorum is present at the Special Meeting and will have the same effect as a vote "AGAINST" the Merger Proposal. Broker non-votes, if any, will not be counted for purposes of establishing a quorum and will have the same effect as a vote "AGAINST" the Merger Proposal.

        After careful consideration, the Fibrocell board of directors (the "Fibrocell Board"), on September 12, 2019, approved the Merger Agreement and determined that it is fair to, advisable and in the best interests of Fibrocell and its stockholders for Fibrocell to enter into the Merger Agreement and to effect the Merger and the other transactions contemplated thereby. The Fibrocell Board


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accordingly recommends that you vote "FOR" the Merger Proposal, the Compensation Proposal and the Adjournment Proposal.

    By order of the Board of Directors,

 

 

GRAPHIC

 

 

John M. Maslowski
President and Chief Executive Officer
                , 2019    

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SUMMARY

  1

QUESTIONS AND ANSWERS ABOUT THE SPECIAL MEETING AND THE MERGER

  11

THE SPECIAL MEETING

  21

THE COMPANIES

  26

PROPOSAL 1: ADOPTION OF THE MERGER AGREEMENT

  27

THE MERGER

  28

Effects of the Merger

  28

Background of the Merger

  28

Recommendation of the Fibrocell Board

  46

Reasons for the Merger

  47

Opinion of Fibrocell's Financial Advisor

  51

Certain Unaudited Prospective Financial Information

  58

Interests of Directors and Executive Officers in the Merger

  61

No Financing Condition; Financing Cooperation

  65

Regulatory Waiting Periods

  65

Delisting and Deregistration of Common Stock

  66

THE MERGER AGREEMENT

  67

Explanatory Note Regarding Representations, Warranties and Covenants in the Merger Agreement

  67

The Merger

  67

Merger Consideration

  67

Treatment of Stock Options

  69

Directors and Officers; Certificate of Incorporation; Bylaws

  69

Stockholders Seeking Appraisal

  69

Payment for the Shares of Common Stock

  70

Payment for the Shares of Preferred Stock

  71

Payment for Warrants

  71

Representations and Warranties

  72

Conduct of Business Pending the Merger

  73

Meeting of Our Stockholders

  76

Efforts to Complete the Merger

  76

Employee Matters

  77

Indemnification and Insurance

  78

No Financing Condition; Financing Cooperation

  78

Conditions to the Merger

  78

No Solicitation of Other Offers

  80

Termination of the Merger Agreement

  82

Termination Fees and Expenses

  83

Amendment, Extension and Waiver

  84

MATERIAL U.S. FEDERAL INCOME TAX CONSEQUENCES OF THE MERGER

  85

APPRAISAL RIGHTS

  89

PROPOSAL 2: APPROVAL OF ADVISORY (NON-BINDING) VOTE ON COMPENSATION

  94

PROPOSAL 3: APPROVAL OF AUTHORITY TO ADJOURN THE SPECIAL MEETING

  94

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

  95

MARKET PRICE OF COMMON STOCK

  97

HOUSEHOLDING

  98

WHERE YOU CAN FIND MORE INFORMATION

  99

ANNEX A—AGREEMENT AND PLAN OF MERGER

  A-1

ANNEX B—OPINION OF CANACCORD GENUITY LLC

  B-1

ANNEX C—SECTION 262 OF THE GENERAL CORPORATION LAW OF THE STATE OF DELAWARE

  C-1

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FIBROCELL SCIENCE, INC.
405 Eagleview Blvd.
Exton, Pennsylvania 19341



PROXY STATEMENT
FOR
SPECIAL MEETING OF STOCKHOLDERS

            , 2019



SUMMARY

        This summary highlights information contained elsewhere in this proxy statement and may not contain all the information that is important to you. We urge you to read carefully the remainder of this proxy statement, including the attached annexes and the documents referred to in this proxy statement, because this summary does not provide all the information that might be important to you with respect to the Merger and the other matters being considered at the special meeting of stockholders (the "Special Meeting"). We have included page references to direct you to a more complete description of the topics presented in this summary.

        All references to "Fibrocell," "the Company," "we," "us," or "our" in this proxy statement refer to Fibrocell Science, Inc., a Delaware corporation; all references in this proxy statement to "Castle Creek" refer to Castle Creek Pharmaceutical Holdings, Inc., a Delaware corporation; all references to "Merger Sub" refer to Castle Creek Merger Corp., a Delaware corporation and a wholly-owned subsidiary of Castle Creek; all references to the "Merger" refer to the merger of Merger Sub with and into Fibrocell, with Fibrocell surviving as a wholly-owned subsidiary of Castle Creek; and, unless otherwise indicated or as the context requires, all references to the "Merger Agreement" refer to the Agreement and Plan of Merger, dated as of September 12, 2019, as it may be amended from time to time, by and among Fibrocell, Castle Creek and Merger Sub, a copy of which is attached as Annex A to this proxy statement. Fibrocell, with respect to its existence after the Effective Time of the Merger, is sometimes referred to in this proxy statement as the "Surviving Corporation."


The Companies

Fibrocell Science, Inc. (see page 26)

        Fibrocell is an autologous cell and gene therapy company focused on translating personalized biologics into medical breakthroughs for diseases affecting the skin and connective tissue. Our distinctive approach to personalized biologics is based on our proprietary autologous fibroblast technology. We target the underlying cause of disease by using fibroblast cells from a patient's skin and genetically modifying them to create localized therapies that are compatible with the unique biology of the patient. Currently, all of our research and development operations and focus are on gaining regulatory approvals to commercialize our product candidates in the United States.

        Our principal executive offices are located at 405 Eagleview Blvd., Exton, PA 19341 and our telephone number is (484) 713-6000. Our common stock, par value $0.001 per share ("Common Stock"), is listed and traded on the Nasdaq Stock Market LLC ("Nasdaq") under the symbol "FCSC."

        See "Where You Can Find More Information" on page 99.

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Castle Creek Pharmaceutical Holdings, Inc. (see page 26)

        Castle Creek Pharmaceutical Holdings, Inc. is a privately held holding company that holds and invests in companies in the orphan dermatology space. Castle Creek's principle executive offices are located at 233 Mt. Airy Road, 1st Floor, Basking Ridge, NJ, 07920, and its telephone number is (862) 286-0400.

Castle Creek Merger Corp. (see page 26)

        Castle Creek Merger Corp. is a Delaware corporation and a wholly-owned subsidiary of Castle Creek. Merger Sub was formed on September 2, 2019 for the purpose of effecting the Merger. Merger Sub has not engaged in any business to date except for activities incidental to its incorporation and activities undertaken in connection with the Merger and the other transactions contemplated by the Merger Agreement. Upon the terms and subject to the conditions of the Merger Agreement, Merger Sub will merge with and into Fibrocell, with Fibrocell surviving the Merger as a wholly-owned subsidiary of Castle Creek.

        The principal executive offices of Merger Sub are located at 233 Mt. Airy Road, 1st Floor, Basking Ridge, NJ, 07920, and its telephone number is (862) 286-0400.


The Merger

        A copy of the Merger Agreement is attached as Annex A to this proxy statement and is incorporated herein by reference. We encourage you to read the entire Merger Agreement carefully and in its entirety because it is the principal document governing the Merger. For more information about the Merger Agreement, see "The Merger Agreement" beginning on page 67.

The Merger (see page 28)

        If the Merger is completed, at the Effective Time of the Merger, Merger Sub will merge with and into Fibrocell. Fibrocell will survive the Merger as a wholly-owned subsidiary of Castle Creek. We intend to complete the Merger as soon as reasonably practicable and currently expect to complete the Merger in the fourth quarter of 2019. The Merger is subject to regulatory clearances (to the extent required) and other customary closing conditions, in addition to the approval of holders of Common Stock of Fibrocell at the Special Meeting. It is possible that factors outside the control of Fibrocell and Castle Creek could result in the Merger being completed at a later time or not at all.

Merger Consideration (see page 67)

        At the Effective Time, each share of our Common Stock issued and outstanding immediately prior to the Merger (other than shares held directly by Castle Creek or Merger Sub and shares owned by Company stockholders who have exercised their appraisal rights under Delaware law) will be converted into and thereafter represent the right to receive $3.00 in cash, without interest (the "Merger Consideration"), subject to any withholding of taxes required by applicable law. Upon completion of the Merger, all such shares of Common Stock shall no longer be outstanding and shall automatically be cancelled and shall cease to exist, and shall thereafter represent only the right to receive the Merger Consideration.

Treatment of Preferred Stock (see page 68)

        After the Effective Time, each share of the Company's Series A Convertible Preferred Stock issued and outstanding immediately prior to the Merger (the "Preferred Stock") will remain outstanding (until converted by the holders thereof pursuant to the Consent and Termination Agreements, as defined below), and will thereafter only represent the right to receive an amount in cash, without interest, equal

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to (i) the number of shares of Common Stock underlying each share of Preferred Stock multiplied by (ii) the Merger Consideration (the "Conversion Amount").

Consent and Termination Agreements

        In addition, as consideration for entry into the Consent and Termination Agreements, the holders of Preferred Stock will each receive a promissory note to be issued by Merger Sub immediately prior to the Merger, in each case for an amount equal to (and in addition to) the aggregate Conversion Amount such party is entitled to in connection with such party's ownership of shares of Preferred Stock.

Treatment of Warrants (see page 68)

        After the Effective Time, each outstanding Company warrant to purchase shares of Common Stock shall be generally entitled to receive (i) upon any subsequent exercise, an amount equal to the Merger Consideration less the exercise price for such warrant, or (ii) if eligible pursuant to the terms of the warrant, upon notification by the holder of such warrant to the Company within 30 days of the Effective Time, an amount equal to the Black-Scholes value of the warrant (as described in such warrant).

Appraisal Rights (see page 89)

        Shares of Common Stock held by stockholders who have properly exercised appraisal rights under Section 262 of the Delaware General Corporation Law ("DGCL") (and have not withdrawn such exercise or lost such rights) will not be converted into the right to receive the Merger Consideration, but will instead be converted into the right to receive payment in cash for the fair value of their shares as determined in accordance with Section 262 of the DGCL. The fair value of the shares as determined in accordance with Section 262 of the DGCL may be more or less than (or the same as) the Merger Consideration. Stockholders who wish to exercise appraisal rights must comply fully with all applicable requirements of Section 262 of the DGCL, which is summarized in this proxy statement and attached as Annex C to this proxy statement. Failure to follow exactly the procedures specified under Section 262 of the DGCL may result in the loss of appraisal rights. Because of the complexity of Section 262 of the DGCL relating to appraisal rights, if you are considering exercising your appraisal rights we encourage you to seek the advice of your own legal counsel.

The Special Meeting (see page 21)

        The Special Meeting of stockholders is scheduled to be held at the offices of Hogan Lovells US LLP located at 1735 Market St., Floor 23, Philadelphia, PA 19103 on                , 2019, at        , Eastern Time. The Special Meeting is being held in order to consider and vote on the following:

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        Only holders of record of Common Stock at the close of business on                , 2019, the record date for the Special Meeting ("Record Date"), are entitled to notice of, and to vote at, the Special Meeting or any adjournment or postponement of the Special Meeting. At the close of business on the Record Date,                shares of Common Stock were issued and outstanding.

        A quorum is necessary to transact business at the Special Meeting. Holders of a majority of all issued and outstanding shares of Common Stock entitled to vote as of the Record Date must be present in person or represented by proxy at the Special Meeting in order for there to be a quorum. Shares of Common Stock represented at the Special Meeting but not voted, including shares for which a stockholder directs an "abstention" from voting, will be counted as present for purposes of establishing a quorum. Broker non-votes (shares held by a broker, bank, trust company or other nominee that is present in person or by represented by proxy at the Special Meeting but with respect to which the broker or other stockholder of record is not instructed by the beneficial owner of such shares how to vote on a particular proposal and the broker does not have discretionary voting power on such proposal), if any, will not be counted as present for purposes of establishing a quorum. If a quorum is not present in person or represented by proxy, the Special Meeting may be adjourned until the holders of the number of shares of Common Stock required to constitute a quorum are present in person or represented by proxy.

        You may cast one vote on each matter submitted to a vote at the Special Meeting for each share of Common Stock you own at the close of business on the Record Date. The Merger Proposal requires the affirmative vote of the holders of a majority of the outstanding shares of Common Stock as of the Record Date entitled to vote thereon. The Compensation Proposal and the Adjournment Proposal each requires the affirmative vote of the holders of a majority of the shares of Common Stock present in person or represented by proxy at the Special Meeting and entitled to vote thereon.

        Your failure to vote, or failure to instruct your broker, bank, trust company or other nominee to vote, will have the same effect as a vote against the Merger Proposal, but, assuming a quorum is present at the Special Meeting, will have no effect on the Compensation Proposal or the Adjournment Proposal.

Recommendation of the Fibrocell Board and Reasons for the Merger (see page 46)

        After careful consideration, at a meeting held on September 12, 2019, the members of the Fibrocell Board present unanimously approved the Merger Agreement and determined that it is fair to, advisable and in the best interests of Fibrocell and its stockholders for Fibrocell to enter into the Merger Agreement and effect the Merger and the other transactions contemplated thereby. Fibrocell directors Julian P. Kirk and Marcus E. Smith voluntarily recused themselves from, and did not attend, the September 12, 2019 meeting of the Fibrocell Board in light of their respective interests described in the section entitled "The Merger—Interests of Directors and Executive Officers in the Merger" beginning on page 61. The Fibrocell Board accordingly recommends that our stockholders vote "FOR" the adoption of the Merger Agreement. The Fibrocell Board considered many factors in reaching its conclusion, including, without limitation, the value that stockholders would realize in the Merger, the current and historical market prices of Fibrocell shares relative to the $3.00 per share Merger Consideration, the fact that the Merger Consideration consists entirely of cash and the risks associated with the implementation of Fibrocell's business plan. See "The Merger—Reasons for the Merger" beginning on page 47.

        The Fibrocell Board also recommends that you vote "FOR" the Compensation Proposal and "FOR" the Adjournment Proposal.

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Opinion of Fibrocell's Financial Advisor (see page 51)

        The Fibrocell Board engaged Canaccord Genuity LLC ("Canaccord Genuity") to provide financial advisory services and to assist the Fibrocell Board in the consideration and evaluation of potential strategic transactions on Fibrocell's behalf. At a meeting of the Fibrocell Board held on September 12, 2019 to evaluate the Merger, Canaccord Genuity delivered to the Fibrocell Board an oral opinion, which opinion was confirmed by delivery of a written opinion, dated September 12, 2019, to the effect that, as of that date and based upon and subject to certain assumptions, factors and qualifications set forth in the written opinion, the consideration of $3.00 per share in cash, without interest, to be received by holders of Common Stock (other than certain excluded holders referenced in the opinion) in the Merger was fair, from a financial point of view, to such holders. Canaccord Genuity did not express any view on, and its opinion did not address, any other term or aspect of any other agreements or arrangements contemplated by the Merger Agreement or entered into in connection with the Merger (including, without limitation, any agreements or arrangements with any holder of Preferred Stock, Convertible Notes, warrants or options).

        The full text of Canaccord Genuity's written opinion is attached to this proxy statement as Annex B and is incorporated into this proxy statement by reference. The description of Canaccord Genuity's opinion set forth in this proxy statement is qualified in its entirety by reference to the full text of such opinion. Fibrocell stockholders are encouraged to read Canaccord Genuity's opinion carefully and in its entirety for a description of the procedures followed, assumptions made, matters considered and qualifications and limitations on the review undertaken by Canaccord Genuity in connection with its opinion. Canaccord Genuity's opinion addressed to the Fibrocell Board was only one of many factors considered by the Fibrocell Board in its evaluation of the Merger and only addresses the fairness, from a financial point of view and as of the date of the opinion, of the $3.00 per share in cash, without interest, to be received in the Merger by holders of Common Stock (other than certain excluded holders referenced in the opinion). Canaccord Genuity's opinion does not address the relative merits of the Merger as compared to other business strategies or transactions that might be available to Fibrocell, nor does it address the underlying business decision of Fibrocell to proceed with the Merger. Canaccord Genuity's opinion was directed to and for the information of the Fibrocell Board only (in its capacity as such) in connection with its evaluation of the Merger and does not constitute advice or a recommendation to the Fibrocell Board or any other person as to how the Fibrocell Board or such person should vote with respect to the Merger or otherwise act on any other matter with respect to the Merger.

        See "The Merger—Opinion of Fibrocell's Financial Advisor" beginning on page 51.

Treatment of Stock Options (see page 69)

        Each stock option to purchase shares of Common Stock issued under Fibrocell's equity incentive plans outstanding immediately prior to the Effective Time, whether vested or unvested, will be converted into the right to receive with respect to each share of Common Stock underlying the stock option (whether vested or unvested) an amount in cash equal to the Merger Consideration minus the exercise price of such stock option, less applicable taxes required to be withheld. If the per share exercise price of a stock option is equal to or greater than the Merger Consideration, the stock option shall terminate and be canceled for no consideration. See "The Merger—Interests of Directors and Executive Officers in the Merger" beginning on page 61 and "The Merger Agreement—Treatment of Stock Options" beginning on page 69.

Interests of Directors and Executive Officers in the Merger (see page 61)

        In considering the recommendation of the Fibrocell Board that our stockholders vote to approve the Merger Proposal, stockholders should be aware that our directors and executive officers have

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interests in the Merger that may be different from, or in addition to, the interests of our stockholders generally and that may present actual or potential conflicts of interest. A special committee (the "Special Committee"), composed of disinterested directors of the Fibrocell Board, Douglas J. Swirsky, Kelvin D. Moore and Marc B. Mazur, was aware of and considered these potential interests when it evaluated and negotiated the Merger Agreement, and recommended that the Fibrocell Board approve the Merger Agreement and recommend approval of the Merger Agreement by Fibrocell's stockholders. In addition, the Fibrocell Board was aware of and considered these potential interests, among other matters, in approving the Merger Agreement and in recommending to stockholders the approval of the Merger Proposal, the Compensation Proposal and the Adjournment Proposal. These interests include the following:

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        For more information and quantification of these interests, please see "The Merger—Interests of Directors and Executive Officers in the Merger" beginning on page 61.

Material U.S. Federal Income Tax Consequences of the Merger (see page 85)

        The Merger generally will be a taxable transaction for U.S. federal income tax purposes. In general, U.S. holders (as defined in "Material U.S. Federal Income Tax Consequences of the Merger") whose shares of Common Stock are converted into cash in the Merger will recognize gain or loss for U.S. federal income tax purposes in an amount equal to the difference, if any, between the amount of cash received with respect to such shares (determined before the deduction of any applicable withholding taxes) and the U.S. holder's adjusted tax basis in such shares. Non-U.S. holders (as defined in "Material U.S. Federal Income Tax Consequences of the Merger") generally will not be subject to U.S. federal income tax as a result of the non-U.S. holder's receipt of cash in exchange for shares of Common Stock pursuant to the Merger, subject to certain exceptions discussed in "Material U.S. Federal Income Tax Consequences of the Merger," but may be subject to tax under non-U.S. income tax laws.

        You should read the section entitled "Material U.S. Federal Income Tax Consequences of the Merger" beginning on page 85 for a more detailed discussion of the U.S. federal income tax consequences of the Merger. Tax matters can be complicated and the tax consequences of the Merger to you will depend on your particular tax situation. You are encouraged to consult your tax advisor to determine the tax consequences of the Merger to you.

No Financing Condition; Financing Cooperation (see page 65)

        The Merger is not subject to a financing condition. Castle Creek has represented that, after giving effect to the financing contemplated by the commitment letters delivered to Fibrocell, it will have on the closing date sufficient funds available to pay the aggregate Merger Consideration, the aggregate Conversion Amount, and the aggregate consideration for the Company's warrants and all related fees required to be paid by Castle Creek and the Surviving Corporation. Castle Creek has delivered to Fibrocell executed commitment letters pursuant to which Castle Creek's financing sources have agreed to provide cash equity or debt financing in an aggregate amount of up to $35 million for the Merger. Fibrocell has agreed to provide all cooperation reasonably requested by Castle Creek in connection with any financing by Castle Creek, including using reasonable best efforts to, among other things, participate in meetings, assist with preparing materials, provide documentation, and obtain letters and documentation customary for the type and nature of financing Castle Creek intends to secure.

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        See "The Merger—No Financing Condition; Financing Cooperation" beginning on page 65.

Conditions to the Merger (see page 78)

        Each party's obligation to complete the Merger depends on the following conditions being satisfied or, where legally permissible, waived:

        Each party's obligation to complete the Merger is also subject to the following additional conditions:

        In addition, Castle Creek's obligation to complete the Merger is also subject to the following conditions:

        The completion of the Merger is not conditioned upon Castle Creek's receipt of financing.

No Solicitation of Other Offers (see page 80)

        The Merger Agreement provides that Fibrocell, its subsidiaries and its and their representatives shall not:

        Fibrocell, its subsidiaries and its and their representatives must also immediately cease all existing discussions or negotiations with any person conducted prior to entering into the Merger Agreement with respect to any Acquisition Proposal.

        Notwithstanding the above-described restrictions, if following the date of the Merger Agreement and prior to the approval of the Fibrocell stockholders of the Merger Proposal, Fibrocell receives a

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bona fide written unsolicited Acquisition Proposal that the Fibrocell Board determines in good faith is, or determines in good faith is reasonably likely to result in, a Superior Proposal and that the failure to take such action would be reasonably likely to breach the directors' fiduciary duties under applicable law, Fibrocell may under certain circumstances furnish information to, and engage in discussions or negotiations with, the third party making such Acquisition Proposal.

        The terms "Superior Proposal" and "Acquisition Proposal" are defined under "The Merger Agreement—No Solicitation of Other Offers" beginning on page 80.

Changes in Board Recommendation (see page 81)

        Under the Merger Agreement, subject to certain exceptions, neither the Fibrocell Board nor any committee thereof may (i) withdraw, change, qualify, withhold or modify, or publicly propose to do any of the foregoing, in a manner adverse to Castle Creek or Merger Sub, its recommendation that Fibrocell's stockholders adopt the Merger Agreement or (ii) adopt, approve or recommend, any Acquisition Proposal or publicly propose to do the same.

        Notwithstanding the foregoing limitations, prior to the approval of the Fibrocell stockholders of the Merger Proposal, the Fibrocell Board may, under certain circumstances, change its recommendation that Fibrocell's stockholders adopt the Merger Agreement or terminate the Merger Agreement pursuant to the terms of the Merger Agreement to accept a Superior Proposal, only if the Fibrocell Board has determined in good faith, after, among other things, consultation with its financial advisors and outside legal counsel, that the failure to do so would reasonably be expected to be a breach of the directors' fiduciary duties under applicable law. Prior to changing its recommendation that stockholders adopt the Merger Agreement or terminating the Merger Agreement pursuant to the terms of the Merger Agreement to accept a Superior Proposal, the Fibrocell Board must provide written notice to Castle Creek at least four business days prior to such action and during such notice period must negotiate in good faith with Castle Creek regarding, and consider in good faith, any revisions to the Merger Agreement proposed by Castle Creek.

Termination of the Merger Agreement (see page 82)

        The Merger Agreement may be terminated by the mutual written consent of Fibrocell, Castle Creek and Merger Sub, and under certain specified circumstances by either Fibrocell or Castle Creek, including if the Merger has not been consummated on or before February 12, 2020.

Termination Fees; Effect of Termination (see page 84)

        In certain circumstances, the Fibrocell Board has the right to terminate the Merger Agreement in order to enter into a definitive agreement relating to a Superior Proposal, as further described in "The Merger Agreement—Termination of the Merger Agreement" beginning on page 82. In that event and in certain other specified circumstances, the Merger Agreement provides that we must pay Castle Creek a termination fee of $2.0 million. See "The Merger Agreement—Termination Fees and Expenses" beginning on page 84.

Effects on Fibrocell if the Merger is not Completed (see page 15)

        In the event that the proposal to approve the Merger Agreement does not receive the required approval from our stockholders, or if the Merger is not completed for any other reason, you will not receive any payment for your shares of Common Stock in connection with the Merger. Instead, Fibrocell will remain an independent public company and stockholders will continue to own their shares of Common Stock. Under certain circumstances, if the Merger Agreement is terminated, we may be obligated to pay to Castle Creek a termination fee. See "The Merger Agreement—Termination Fees and Expenses" beginning on page 84.

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Delisting and Deregistration of Shares of Common Stock (see page 66)

        Upon completion of the Merger, the Surviving Corporation will cause the Common Stock currently listed on Nasdaq to cease to be listed and will subsequently deregister the Common Stock under the Securities Exchange Act of 1934, as amended (the "Exchange Act").

Market Price of Common Stock (see page 97)

        The closing price of Common Stock on Nasdaq on September 11, 2019, the last trading day prior to the announcement of the Merger Agreement, was $1.88 per share. The closing price of Common Stock on Nasdaq on                        , 2019, the last trading day before the date of this proxy statement was $      per share.

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QUESTIONS AND ANSWERS ABOUT THE SPECIAL MEETING AND THE MERGER

        The following questions and answers address briefly some questions you may have regarding the Special Meeting and the proposed Merger. These questions and answers may not address all questions that may be important to you as a stockholder. For important additional information, please refer to the more detailed discussion contained elsewhere in this proxy statement, the annexes to this proxy statement and the documents referred to in this proxy statement.

Q:    Why am I receiving this proxy statement?

A:
On September 12, 2019, Fibrocell entered into the Merger Agreement providing for the Merger of Merger Sub with and into Fibrocell, with Fibrocell surviving the Merger as a wholly-owned subsidiary of Castle Creek. The Fibrocell Board is furnishing this proxy statement and form of proxy card to the holders of Common Stock in connection with the solicitation of proxies in favor of the proposal to adopt the Merger Agreement and to approve the other proposals to be voted on at the Special Meeting or any adjournments or postponements thereof. You are receiving this proxy statement because you were a stockholder of record of Fibrocell as of the close of business on the Record Date for the Special Meeting.

Q:    What is included in the proxy materials?

A:
The proxy materials include the proxy statement and the annexes to the proxy statement, including the Merger Agreement, and a proxy card or voting instruction form.

Q:    When and where will the Special Meeting of stockholders be held?

A:
The Special Meeting will be held at the offices of Hogan Lovells US LLP located at 1735 Market St., Floor 23, Philadelphia, PA 19103 on                                    , 2019, at                                    , Eastern Time.

Q:    What is the purpose of the Special Meeting?

A:
At the Special Meeting, stockholders will consider and vote on:

a proposal to adopt the Merger Agreement;

a non-binding, advisory proposal to approve the compensation that will or may become payable to our named executive officers in connection with the Merger; and

a proposal to approve one or more adjournments of the meeting, if necessary or appropriate, to solicit additional proxies if there are not sufficient votes to approve the Merger Proposal.

Q:    What is the proposed Merger and what effects will it have on Fibrocell?

A:
The proposed Merger is the acquisition of Fibrocell by Castle Creek through the merger of Merger Sub with and into Fibrocell pursuant to the Merger Agreement. If the Merger Proposal is approved by the requisite number of shares of Common Stock and the other closing conditions under the Merger Agreement have been satisfied or waived, Merger Sub will merge with and into Fibrocell, with Fibrocell continuing as the Surviving Corporation. As a result of the Merger, Fibrocell will become a wholly-owned subsidiary of Castle Creek and you will no longer own shares of Common Stock. The Surviving Corporation is expected to delist its Common Stock from

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Q:    What will I receive in the Merger?

A:
If the Merger is completed, you will have the right to receive $3.00 in cash, without interest and subject to any applicable withholding taxes, for each share of Common Stock that you own immediately prior to the Effective Time of the Merger.

Q:    What happens if the market price of shares of Common Stock changes before the closing of the Merger?

A:
No change will be made to the Merger Consideration of $3.00 per share of Common Stock as a result of a change in the market price of our Common Stock.

Q:    If the Merger is completed, what will happen to Fibrocell stock options?

A:
For information regarding the treatment of Fibrocell options, please see "The Merger Agreement—Treatment of Stock Options" beginning on page 69.

Q:    What constitutes a "quorum" for purposes of the Special Meeting?

A:
A quorum is necessary to transact business at the Special Meeting. Holders of a majority of all issued and outstanding shares of Common Stock entitled to vote as of the Record Date must be present in person or represented by proxy at the Special Meeting in order for there to be a quorum. Shares of Common Stock represented at the Special Meeting but not voted, including shares for which a stockholder directs an "abstention" from voting, will be counted as present for purposes of establishing a quorum. Broker non-votes (shares held by a broker, bank, trust company or other nominee that is present in person or represented by proxy at the Special Meeting but with respect to which the broker or other stockholder of record is not instructed by the beneficial owner of such shares how to vote on a particular proposal and the broker does not have discretionary voting power on such proposal), if any, will not be counted as present for purposes of establishing a quorum. If a quorum is not present in person or represented by proxy, the Special Meeting may be adjourned until the holders of the number of shares of Common Stock required to constitute a quorum are present in person or represented by proxy.

Q:    What is the vote required to adopt the Merger Agreement?

A:
The proposal to adopt the Merger Agreement requires the affirmative vote of the holders of a majority of the outstanding shares of Common Stock as of the Record Date entitled to vote thereon. Abstentions and "broker non-votes" will have the same effect as a vote "AGAINST" the proposal to adopt the Merger Agreement.

Q:    What is the vote required to approve the other proposals?

A:
The Compensation Proposal and the Adjournment Proposal each requires the affirmative vote of the holders of a majority of the shares of Common Stock present in person or represented by proxy at the Special Meeting and entitled to vote thereon. Assuming a quorum is present at the

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Q:    When is the proposed Merger expected to be completed?

A:
We intend to complete the Merger as soon as reasonably practicable and currently expect to complete the Merger in the fourth quarter of 2019. However, consummation of the Merger is subject to conditions to closing, in addition to the approval of Fibrocell's stockholders at the Special Meeting, and it is possible that factors outside the control of Fibrocell and Castle Creek could result in the Merger being completed at a later time or not at all.

Q:    Who is entitled to vote at the Special Meeting?

A:
Only holders of record of Common Stock at the close of business on                        , 2019, the Record Date for the Special Meeting, are entitled to receive notice of, and to vote at, the Special Meeting or any adjournment or postponement of the Special Meeting. At the close of business on the Record Date,                                     shares of Common Stock were issued and outstanding and held by                                    holders of record. Each share of Common Stock is entitled to one vote on each matter submitted to a vote at the Special Meeting.

Q:    Who may attend the Special Meeting?

A:
Stockholders of record as of the close of business on                        , 2019, or their duly appointed proxies, may attend the Special Meeting. "Street name" holders (those whose shares are held through a broker, bank, trust company or other nominee) should bring a copy of an account statement reflecting their ownership of Common Stock as of the Record Date. If you are a "street name" holder and you wish to vote at the Special Meeting, you must also bring a legal proxy from the record holder (your broker, bank, trust company or other nominee) of the shares of Common Stock authorizing you to vote at the Special Meeting.

Q:    How does the Fibrocell Board recommend that I vote?

A:
At a meeting held on September 12, 2019, the members of the Fibrocell Board present unanimously approved the Merger Agreement and determined that it is fair to, advisable, and in the best interests of Fibrocell and its stockholders for Fibrocell to enter into the Merger Agreement and effect the Merger and the other transactions contemplated thereby. Messrs. Kirk and Smith voluntarily recused themselves from, and did not attend, the September 12, 2019 meeting of the Fibrocell Board in light of their respective interests described in the section entitled "The Merger—Interests of Directors and Executive Officers in the Merger" beginning on page 6. The Fibrocell Board accordingly recommends that you vote "FOR" each of the Merger Proposal, the Compensation Proposal and the Adjournment Proposal.

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Q:    Who is soliciting my vote?

A:
The Fibrocell Board is soliciting your proxy, and Fibrocell will bear the cost of soliciting proxies. Okapi Partners LLC has been retained as our proxy solicitor to assist with the solicitation of proxies for the Special Meeting.

Q:    What do I need to do now?

A:
Carefully read and consider the information contained in this proxy statement, including its annexes.

Q:    What is a proxy?

A:
A proxy is your legal designation of another person, referred to as a "proxy," to vote your shares of Common Stock. The written document describing the matters to be considered and voted on at the Special Meeting is called a "proxy statement." The document used to designate a proxy to vote your shares of Common Stock is called a "proxy card."

Q:    How do I vote if my shares are registered directly in my name?

A:
If you are a record holder of Common Stock, you may vote in person at the Special Meeting or authorize the persons named as proxies on the proxy card to vote your shares by returning the proxy card by mail, or voting through the Internet, or by telephone. We recommend that you vote as soon as possible, even if you are planning to attend the Special Meeting, so that the vote count will not be delayed. Both the Internet and the telephone provide convenient, cost-effective alternatives to returning your proxy card by mail. If you choose to submit a proxy to vote your shares through the Internet or by telephone, there is no need for you to mail back your proxy card. For more detailed instructions on how to vote using one of these methods, please see the section of this proxy statement entitled "The Special Meeting—Voting of Proxies" beginning on page 23.

Q:    How do I vote my shares if they are held in the name of my broker ("street name")?

A:
If you hold your shares in a stock brokerage account or if your shares are held by a broker, bank, trust company or other nominee (that is, in "street name"), you must follow the directions from your broker, bank, trust company or other nominee provided to you in order to vote. Please check the voting form used by your broker, bank, trust company or other nominee. If you do not provide your broker, bank, trust company or other nominee with instructions, your shares of Common

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Q:    What will happen if I fail to submit a proxy or I abstain from voting?

A:
If you fail to submit a proxy or fail to instruct your broker, bank, trust company or other nominee to vote, it will have the effect of a vote against the Merger Proposal, but, assuming a quorum is present at the Special Meeting, will have no effect on the Compensation Proposal or the Adjournment Proposal. If you mark your proxy to abstain or provide voting instructions to abstain, it will have the effect of a vote against the Merger Proposal, the Compensation Proposal and the Adjournment Proposal.

Q:    How can I revoke my proxy?

A:
If you have already submitted your proxy by Internet, telephone or by returning your proxy card, you can change your voting instructions before the Special Meeting. If you are a holder of record, you can do this by submitting a written notice of revocation, granting a new, valid proxy bearing a later date (including by telephone or through the Internet), or attending the Special Meeting and voting in person. If you submit a written notice of revocation, it must be received by the Corporate Secretary of Fibrocell no later than the beginning of the Special Meeting. If you grant a new proxy by telephone or Internet, your revised instructions must be received by 11:59 p.m., Eastern Time, on                                    , 2019.

Q:    Do I need to do anything with my stock certificates now?

A:
No. After the Merger is completed, the paying agent for the Merger will mail to each holder of certificates representing shares of Common Stock as of the Effective Time of the Merger a letter of transmittal and instructions for exchanging their shares of Common Stock for the Merger Consideration. Upon surrender of the certificates for cancellation along with the executed letter of transmittal and other required documents described in the instructions or otherwise required by the paying agent in accordance with the Merger Agreement, you will receive the Merger Consideration. Please do not send your stock certificates with your proxy card.

Q:    Can I participate if I am unable to attend the Special Meeting?

A:
If you are unable to attend the Special Meeting in person, we encourage you to send in your proxy card or to vote by telephone or over the Internet. The Special Meeting will not be broadcasted telephonically or over the Internet.

Q:    What happens if the Merger is not completed?

A:
If the Merger Agreement is not adopted by our stockholders or if the Merger is not completed for any other reason, stockholders will not receive any payment for their shares of Common Stock or other Company securities in connection with the Merger. Instead, Fibrocell will remain an independent public company, and shares of Common Stock will continue to be listed and traded

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Q:    Why am I being asked to consider and cast a non-binding advisory vote on the Compensation Proposal?

A:
Under Section 14A of the Exchange Act and the applicable Securities & Exchange Commission ("SEC") rules issued thereunder, we are required to submit a proposal to our stockholders for a non-binding, advisory vote to approve certain compensation that will or may be paid to our named executive officers in connection with the Merger. The Compensation Proposal gives our stockholders the opportunity to vote, on a non-binding, advisory basis, on the compensation that may be paid or become payable to our named executive officers in connection with the Merger.

Q:    What will happen if the Compensation Proposal is not approved?

A:
Approval of the Compensation Proposal is not a condition to consummation of the Merger, and it is advisory in nature only, meaning it will not be binding on Fibrocell. Accordingly, because Fibrocell is contractually obligated to pay such compensation, if the proposed Merger with Fibrocell is completed, the compensation will be payable, subject only to the conditions applicable to such compensation payments, regardless of the outcome of the advisory vote.

Q:    What does it mean if I receive more than one set of voting materials for the Special Meeting?

A:
You may receive more than one set of voting materials for the Special Meeting, including multiple copies of this proxy statement and multiple proxy cards or voting instruction cards. Please complete, sign, date and return each proxy card and voting instruction card that you receive or, if available, please submit your proxy by telephone or over the Internet.

Q:    What happens if I sell my shares of Common Stock before the Special Meeting?

A:
The Record Date for the Special Meeting is earlier than the expected closing date of the Merger. If you own shares of Common Stock as of the close of business on the Record Date but transfer your shares prior to the Special Meeting, you will retain your right to vote at the Special Meeting, but the right to receive the Merger Consideration will pass to the person who holds your shares as of immediately prior to the Effective Time of the Merger.

Q:    May I exercise dissenters' rights or rights of appraisal in connection with the Merger?

A:
Yes. Shares of Common Stock held by stockholders who have properly exercised appraisal rights under Section 262 of the DGCL (and have not withdrawn such exercise or lost such rights) will not be converted into the right to receive the Merger Consideration, but will instead be converted into the right to receive payment in cash for the fair value of their shares as determined in accordance with Section 262 of the DGCL. The fair value of such shares as determined in accordance with Section 262 of the DGCL may be more or less than (or the same as) the Merger Consideration. Stockholders who wish to exercise appraisal rights must comply fully with all applicable requirements of Section 262 of the DGCL, which is summarized in this proxy statement and attached as Annex C to this proxy statement. Failure to follow exactly the procedures specified under Section 262 of the DGCL may result in the loss of appraisal rights. Because of the complexity of Section 262 of the DGCL relating to appraisal rights, if you are considering exercising your appraisal rights we encourage you to seek the advice of your own legal counsel.

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Q:    How can I obtain a proxy card or voting instruction form?

A:
If you lose, misplace or otherwise need to obtain a proxy card or a voting instruction form, please follow the applicable procedure below.
  For Fibrocell stockholders of record:   Please contact: Corporate Secretary at Fibrocell Science, Inc., 405 Eagleview Blvd., Exton, PA 19341, Attn: Corporate Secretary.

 

For holders in street name:

 

Please contact your account representative at your broker, bank, trust company or other nominee.

Q:    Do any of the Fibrocell directors or officers have interests in the Merger that may differ from those of Fibrocell stockholders generally?

A:
Yes. For a description of the interests of Fibrocell directors and executive officers in the Merger, please see "The Merger—Interests of Directors and Executive Officers in the Merger" beginning on page 61.

Q:    Who counts the votes?

A:
Votes are counted by our transfer agent, Broadridge Financial Solutions, Inc., and are then certified by a representative of American Election Services LLC, appointed by the Fibrocell Board to serve as the inspector of election at the Special Meeting.

Q:    Who pays for the proxy solicitation?

A:
Fibrocell will bear the entire cost of this proxy solicitation, including the preparation, printing, mailing and distribution of these proxy materials. We may also reimburse brokerage firms and other persons representing stockholders who hold their shares in street name for reasonable expenses incurred by them in forwarding proxy materials to such stockholders. In addition, certain directors, officers and other employees, without additional remuneration, may solicit proxies in person, or by telephone, facsimile, email and other methods of electronic communication.

Q:    What is "householding"?

A:
Some banks, brokers and similar institutions may be participating in the practice of "householding" proxy materials. This means that only one copy of our proxy materials may have been sent to multiple stockholders in your household. We will promptly deliver a separate copy of the proxy materials to you if you write to us at the following address or call us at the following phone number: Fibrocell Science, Inc., at 405 Eagleview Blvd., Exton, Pa 19341, attention of Corporate Secretary or by telephone at (484) 713-6000.

Q:    How can I obtain additional information about Fibrocell?

A:
We will provide copies of this proxy statement and our Annual Report on Form 10-K for the year ended December 31, 2018, without charge, to any stockholder who makes a written request to our Corporate Secretary at Fibrocell Science, Inc., 405 Eagleview Blvd., Exton, PA 19341, Attn: Corporate Secretary. Our Annual Report on Form 10-K and other SEC filings also may be accessed at www.sec.gov or on the Investors section of our website at www.fibrocell.com. Our website address is provided as an inactive textual reference only. The information provided on or

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Q:    Who can help answer my questions?

A:
If you have questions about the Merger or the other matters to be voted on at the Special Meeting or desire additional copies of this proxy statement or additional proxy cards or otherwise need assistance voting, you should contact:

Okapi Partners LLC
1212 Avenue of the Americas, 24th Floor
New York, New York 10036

Banks and Brokerage Firms, Please Call: (212) 297-0720
Stockholders and All Others Call Toll-Free: (877) 259-6290
Email: info@okapipartners.com

or

Fibrocell Science, Inc.
405 Eagleview Boulevard,
Exton, Pennsylvania 19341
(484) 713-6000
Attn: Corporate Secretary

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CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING STATEMENTS

        This proxy statement contains not only historical information, but also forward-looking statements made pursuant to the safe-harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements often include the words "forecast," "expect," "believe," "will," "intend," "plan," and words of similar substance. Such forward-looking statements include the expected completion and timing of the proposed transaction and other information relating to the proposed transaction. Such forward-looking statements are subject to risks and uncertainties that could cause actual results or performance to differ materially from those expressed in or contemplated by the forward-looking statements, including the following:

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        Fibrocell assumes no obligation to update or revise publicly the information in this communication, whether as a result of new information, future events or otherwise, except as otherwise required by law. Readers are cautioned not to place undue reliance on these forward-looking statements that speak only as of the date hereof. There can be no assurance that the Merger will in fact be completed.

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THE SPECIAL MEETING

        This proxy statement is being provided to the stockholders of Fibrocell in connection with the solicitation of proxies by the Fibrocell Board for use at the Special Meeting to be held at the time and place specified below, and at any properly convened meeting following an adjournment or postponement thereof. This proxy statement provides stockholders of Fibrocell with the information about the Special Meeting and should be read carefully in its entirety.

Date, Time and Place

        The Special Meeting is scheduled to be held at the offices of Hogan Lovells US LLP, located at 1735 Market St., Floor 23, Philadelphia, PA 19103, on            , 2019, at                , Eastern Time.

Purpose of the Special Meeting

        At the Special Meeting, stockholders will be asked to consider and vote on the following proposals:

Recommendation of the Fibrocell Board

        After careful consideration, and upon unanimous recommendation of the Special Committee, on September 12, 2019, the members of the Fibrocell Board present unanimously approved the Merger Agreement and determined that it is fair to, advisable, and in the best interests of Fibrocell and its stockholders for Fibrocell to enter into the Merger Agreement and effect the Merger and the other transactions contemplated thereby. The Fibrocell Board accordingly recommends that stockholders vote "FOR" the Merger Proposal, the Compensation Proposal and the Adjournment Proposal. Messrs. Kirk and Smith voluntarily recused themselves from, and did not attend, the September 12, 2019 meeting of the Fibrocell Board in light of their respective interests described in the section entitled "The Merger—Interests of Directors and Executive Officers in the Merger" beginning on page 61. The Fibrocell Board considered many factors in reaching its conclusion, including, without limitation, the value that stockholders would realize in the Merger, the current and historical market prices of Fibrocell shares relative to the $3.00 per share Merger Consideration, the fact that the Merger Consideration consists entirely of cash and the risks associated with the implementation of Fibrocell's business plan. See and read carefully "The Merger—Reasons for the Merger" beginning on page 47.

        The Fibrocell Board recommends that stockholders vote "FOR" each of the Merger Proposal, the Compensation Proposal and the Adjournment Proposal. See "The Merger—Reasons for the Merger" beginning on page 47.

Record Date; Stockholders Entitled to Vote

        Only holders of record of Common Stock at the close of business on                , 2019, the Record Date for the Special Meeting, will be entitled to notice of, and to vote at, the Special Meeting or any adjournment or postponement thereof. At the close of business on the Record Date,                shares of Common Stock were issued and outstanding and held by                holders of record. As of the close of business on the Record Date, approximately      % of the outstanding shares of Common Stock were held by our directors and executive officers and their affiliates. We currently expect that our directors and executive officers will vote their shares in favor of the above-listed proposals. Although none of our directors or executive officers has entered into any agreements obligating him or her to vote his or her shares in favor of the above-listed proposals, affiliates of two of our directors, Julian P. Kirk (who is

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the son of Randal J. Kirk) and Marcus E. Smith, have entered into Voting Agreements pursuant to which they have agreed to vote their shares in favor of the Merger Proposal (see "The Merger—Interests of Directors and Executive Officers in the Merger"). A complete list of stockholders entitled to vote at the Special Meeting will be available for examination by any stockholder for any purpose germane to the Special Meeting at our executive offices and principal place of business at 405 Eagleview Blvd., Exton, PA 19341 during ordinary business hours for a period of ten days before the Special Meeting. The list will also be available at the Special Meeting for examination by any stockholder present at the Special Meeting.

        Each share of Common Stock owned is entitled to one vote on each proposal at the Special Meeting.

        If you own shares of Common Stock that are registered in the name of someone else, such as a broker, bank, trust company or other nominee, you are not a holder of record and instead hold your shares in "street name." If you hold shares in "street name," you will need to direct the applicable organization to vote those shares or obtain authorization from it and vote the shares yourself at the Special Meeting, as described below.

Quorum

        A quorum is necessary to transact business at the Special Meeting. Holders of a majority of all issued and outstanding shares of Common Stock entitled to vote as of the Record Date must be present in person or represented by proxy at the Special Meeting in order for there to be a quorum. Shares of Common Stock represented at the Special Meeting but not voted, including shares for which a stockholder directs an "abstention" from voting, will be counted as present for purposes of establishing a quorum. Broker non-votes (shares held by a broker, bank, trust company or other nominee that is present in person or represented by proxy at the Special Meeting but with respect to which the broker, bank, trust company or other stockholder of record is not instructed by the beneficial owner of such shares how to vote on a particular proposal and the broker does not have discretionary voting power on such proposal), if any, will not be counted as present for purposes of establishing a quorum, unless otherwise voting on a discretionary basis or for which direction is provided on another proposal. Shares of Common Stock held in treasury will not be included in the calculation of the number of shares of Common Stock represented at the meeting for purposes of determining whether a quorum is present. If a quorum is not present in person or represented by proxy, the Special Meeting may be adjourned until the holders of the number of shares of Common Stock required to constitute a quorum are present in person or represented by proxy.

Required Vote

        Approval of the Merger Proposal requires the affirmative vote of the holders of a majority of the outstanding shares of Common Stock as of the Record Date entitled to vote thereon. Approval of the Compensation Proposal and the Adjournment Proposal each require the affirmative vote of the holders of a majority of the shares of Common Stock present in person or represented by proxy at the Special Meeting and entitled to vote thereon.

Failure to Vote, Abstentions and Broker Non-Votes

        If you are a stockholder and fail to submit a proxy or fail to instruct your broker, bank, trust company or other nominee to vote, it will have the effect of a vote against the Merger Proposal, but, assuming a quorum is present at the Special Meeting, will have no effect on the Compensation Proposal or the Adjournment Proposal. If you are a stockholder and you mark your proxy to abstain or provide voting instructions to abstain, it will have the effect of a vote against the Merger Proposal, the Compensation Proposal and the Adjournment Proposal.

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Voting in Person

        If you plan to attend the Special Meeting and wish to vote in person, you will be given a ballot at the Special Meeting. Please note, however, that if your shares are held in "street name," and you wish to vote at the Special Meeting, you must bring to the Special Meeting a legal proxy executed in your favor from the record holder of the shares (your broker, bank, trust company or other nominee) authorizing you to vote at the Special Meeting.

        In addition, please be prepared to provide proper identification, such as a driver's license or passport. If you hold your shares in "street name," you will need to provide proof of ownership, such as a recent account statement or letter from your broker, bank, trust company or other nominee proving ownership on the Record Date, along with proper identification. Stockholders will not be allowed to use cameras, recording devices and other similar electronic devices at the meeting.

Voting of Proxies

        If you are a holder of record of Common Stock as of the Record Date for the Special Meeting there are four ways to have your shares voted:

        You will need the 16-digit control number included on your proxy card if you vote by Internet or telephone. Proxies submitted by Internet or telephone must be received by 11:59 p.m., Eastern Time, on            , 2019.

        As of the date hereof, management has no knowledge of any business that will be presented for consideration at the Special Meeting and which would be required to be set forth in this proxy statement or the related proxy card other than the matters set forth in the Notice of Special Meeting of Stockholders. If any other matter is properly presented at the Special Meeting for consideration, it is intended that the persons named in the enclosed form of proxy and acting thereunder will vote in accordance with their best judgment on such matter.

        Your vote is important. Accordingly, please mark, sign, date and return the enclosed proxy card or submit a proxy via the Internet or by telephone whether or not you plan to attend the Special Meeting in person.

        If a properly executed proxy is returned without an indication as to how the shares of Common Stock represented are to be voted with regard to a particular proposal, the Common Stock represented by the proxy will be voted "FOR" such proposal. All shares represented by properly executed proxies received (including proxies received via the Internet or by telephone) in time for the Special Meeting will be voted at the meeting in the manner specified by the stockholder giving those proxies.

Shares Held in "Street Name"

        If you hold your shares in a stock brokerage account or if your shares are held by a broker, bank, trust company or other nominee (that is, in "street name"), you must provide the record holder of your shares with instructions on how to vote your shares if you wish them to be counted. Please follow the voting instructions provided by your broker, bank, trust company or other nominee. Please note that

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you may not vote shares held in "street name" by returning a proxy card directly to Fibrocell or by voting in person at the Special Meeting unless you provide a legal proxy, which you must obtain from your broker, bank, trust company or other nominee. Further, brokers who hold shares of Common Stock on behalf of their customers may not give a proxy to Fibrocell to vote those shares without specific instructions from their customers.

        If you are a stockholder holding your shares in "street name" and you do not instruct your broker, bank, trust company or other nominee on how to vote your shares, your broker, bank, trust company or other nominee cannot vote your shares, which will have the same effect as a vote against the Merger Proposal. If you do not instruct your broker on how to vote your shares, it will have no effect on the Compensation Proposal and the Adjournment Proposal, assuming a quorum is present at the Special Meeting.

Revocation of Proxies

        You have the power to revoke your proxy before the Special Meeting. If you are a holder of record, you can revoke your proxy in one of three ways:

        If you submit a written notice of revocation, it must be received by the Corporate Secretary of Fibrocell at 405 Eagleview Blvd., Exton, PA 19341 no later than the beginning of the Special Meeting. If you do so by telephone or through the Internet, your revised instructions must be received by 11:59 p.m. Eastern Time on                                    , 2019.

        If your shares are held in "street name" by your broker, bank, trust company or other nominee, you should contact your broker to change your vote or revoke your proxy

Tabulation of Votes

        Fibrocell has appointed one or more representatives of American Election Services LLC to serve as the inspector of election for the Special Meeting. The inspector of election will, among other matters, determine the number of shares represented at the Special Meeting to confirm the existence of a quorum, determine the validity of all proxies and ballots and certify the results of voting on all proposals submitted to the stockholders.

Solicitation of Proxies

        The cost of proxy solicitation for the Special Meeting will be borne by Fibrocell. Solicitation initially will be made by mail. Forms of proxies and proxy materials also may be distributed through brokers, custodians, and other like parties to the beneficial owners of shares of Common Stock, in which case these parties will be reimbursed for their reasonable out-of-pocket expenses. Proxies also may be solicited in person or by telephone, facsimile, electronic mail, or other electronic medium by Okapi Partners LLC, our proxy solicitor, or by certain of our directors, officers, and employees, without additional compensation. Fibrocell will also request that brokerage firms, nominees, custodians and fiduciaries forward proxy materials to the beneficial owners of shares of Common Stock held of record on the Record Date and will provide customary reimbursement to such firms for the cost of forwarding

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these materials. Fibrocell has retained Okapi Partners LLC to assist in its solicitation of proxies and has agreed to pay them a fee of approximately $7,500, plus reasonable expenses, for these services.

Adjournment

        If a quorum is not present in person or represented by proxy, stockholders entitled to vote at the Special Meeting, present in person or represented by proxy, shall have the power to adjourn the Special Meeting from time to time, without notice other than announcement at the meeting, until a quorum is present in person or represented by proxy. If a quorum is present at the Special Meeting but there are not sufficient votes at the time of the Special Meeting to approve the Merger Proposal, then stockholders may be asked to vote on the Adjournment Proposal. No notices of an adjourned meeting need be given unless the adjournment is for more than 30 days, in which case a notice of the adjourned meeting will be given to each stockholder of record entitled to vote at the meeting. If, after the adjournment, a new Record Date is fixed for the adjourned meeting, a notice of the adjourned meeting will be given to each stockholder of record entitled to vote at such adjourned meeting as of the Record Date for notice of such adjourned meeting. At any subsequent reconvening of the Special Meeting at which a quorum is present, any business may be transacted that might have been transacted at the original meeting and all proxies will be voted in the same manner as they would have been voted at the original convening of the Special Meeting, except for any proxies that have been effectively revoked or withdrawn prior to the time the proxy is voted at the reconvened meeting.

Assistance

        If you need assistance in completing your proxy card or have questions regarding the Special Meeting, please contact our proxy solicitor, Okapi Partners LLC:

Okapi Partners LLC
1212 Avenue of the Americas, 24th Floor
New York, New York 10036

Banks and Brokerage Firms, Please Call: (212) 297-0720
Stockholders and All Others Call Toll-Free: (877) 259-6290
Email: info@okapipartners.com

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THE COMPANIES

Fibrocell Science, Inc.

        Fibrocell is an autologous cell and gene therapy company focused on translating personalized biologics into medical breakthroughs for diseases affecting the skin and connective tissue. Our distinctive approach to personalized biologics is based on our proprietary autologous fibroblast technology. Fibroblasts are the most common cell in skin and connective tissue and are responsible for synthesizing extracellular matrix proteins, including collagen and other growth factors, that provide structure and support. Because fibroblasts naturally reside in the localized environment of the skin and connective tissue, they represent an ideal delivery vehicle for proteins targeted to these areas. We target the underlying cause of disease by using fibroblast cells from a patient's skin and genetically modifying them to create localized therapies that are compatible with the unique biology of the patient (i.e., which are autologous).

        We are focused on discovering and developing localized therapies for diseases affecting the skin and connective tissue, where there are high unmet needs, to improve the lives of patients and their families. In that regard, we commit significant resources to our research and development programs. Currently, all of our research and development operations and focus are on gaining regulatory approvals to commercialize our product candidates in the United States; however, we may seek to expand into international markets in the future. Currently, all of our research and development operations and focus are on gaining regulatory approvals to commercialize our product candidates in the United States.

        Our pipeline of localized gene therapy candidates include FCX-007 for the treatment of RDEB, a life-threatening genetic disorder diagnosed in infancy with no cure or treatment approved by the FDA. A pivotal Phase 3 clinical trial for FCX-007 was initiated in late July 2019. We are also developing FCX-013 for the treatment of moderate to severe localized scleroderma and are currently enrolling the Phase 1 portion of a Phase 1/2 clinical trial.

        Our principal executive offices are located at 405 Eagleview Blvd., Exton, PA 19341 and our telephone number is (484) 713-6000. Our Common Stock is listed and traded on the Nasdaq under the symbol "FCSC."

        See "Where You Can Find More Information" on page 99.

Castle Creek Pharmaceutical Holdings, Inc.

        Castle Creek Pharmaceutical Holdings, Inc. is a privately held holding company that holds and invests in companies in the orphan dermatology space. Castle Creek's principal executive offices are located at 233 Mt. Airy Road, 1st Floor, Basking Ridge, NJ, 07920, and its telephone number is (862) 286-0400.

Castle Creek Merger Corp.

        Castle Creek Merger Corp. is a Delaware corporation and a wholly-owned subsidiary of Castle Creek. Merger Sub was formed on September 2, 2019 for the purpose of effecting the Merger. Merger Sub has not engaged in any business to date except for activities incidental to its incorporation and activities undertaken in connection with the Merger and the other transactions contemplated by the Merger Agreement. Upon the terms and subject to the conditions of the Merger Agreement, Merger Sub will merge with and into Fibrocell, with Fibrocell surviving the Merger as a wholly-owned subsidiary of Castle Creek.

        The principal executive offices of Merger Sub are located at 233 Mt. Airy Road, 1st Floor, Basking Ridge, NJ, 07920, and its telephone number is (862) 286-0400.

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PROPOSAL 1: ADOPTION OF THE MERGER AGREEMENT

        As discussed below, stockholders are being asked to consider and vote on a proposal to adopt the Merger Agreement. You should read this proxy statement carefully and in its entirety for more detailed information concerning the Merger Agreement and the Merger. In particular, you should read carefully and in its entirety the Merger Agreement, which is attached as Annex A to this proxy statement.

        The Fibrocell Board recommends that stockholders vote "FOR" the Merger Proposal.

        If you return a properly executed proxy (including proxies received via the Internet or by telephone), but do not indicate instructions on your proxy, your shares of Common Stock represented by such proxy will be voted "FOR" the Merger Proposal.

        Approval of the Merger Proposal requires the affirmative vote of the holders of a majority of the outstanding shares of Common Stock as of the Record Date entitled to vote thereon.

        Your failure to vote, or failure to instruct your broker, bank, trust company or other nominee to vote, will have the same effect as a vote "AGAINST" the Merger Proposal. Abstentions and "broker non-votes" will have the same effect as a vote "AGAINST" the Merger Proposal.

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THE MERGER

        The discussion of the Merger in this proxy statement is qualified in its entirety by reference to the Merger Agreement, a copy of which is attached to this proxy statement as Annex A and which is incorporated by reference into this proxy statement.

Effects of the Merger

        Fibrocell is seeking the adoption by its stockholders of the Merger Agreement Fibrocell entered into on September 12, 2019, with Castle Creek and Merger Sub. Pursuant to the terms of the Merger Agreement, at the Effective Time of the Merger, Merger Sub will merge with and into Fibrocell, with Fibrocell surviving the Merger as a wholly-owned subsidiary of Castle Creek. The Fibrocell Board has approved the Merger Agreement and recommends that Fibrocell's stockholders vote to adopt the Merger Agreement.

        At the Effective Time of the Merger, each outstanding share of Common Stock (other than treasury shares and any shares owned by Castle Creek, Merger Sub or any person who properly demands appraisal of their shares pursuant to Section 262 of DGCL (and has not withdrawn such demand or lost its appraisal rights)), will be converted into the right to receive the Merger Consideration of $3.00 per share, without interest, less any applicable withholding taxes.

        After the Effective Time, each share of Preferred Stock will remain outstanding (until converted by the holders thereof pursuant to the Consent and Termination Agreements, as defined below), and will thereafter only represent the right to receive an amount in cash, without interest, equal to the Conversion Amount.

        In addition, after the Effective Time, each outstanding Company warrant shall be generally entitled to receive (i) upon any subsequent exercise, an amount equal to the Merger Consideration less the exercise price for such warrant, or (ii) if eligible pursuant to the terms of the warrant, upon notification by the holder of such warrant to the Company within 30 days of the Effective Time, an amount equal to the Black-Scholes value of the warrant (as described in such warrant).

        Each stock option to purchase shares of Common Stock issued under Fibrocell's equity incentive plans outstanding immediately prior to the Effective Time, whether vested or unvested, will be converted into the right to receive with respect to each share of Common Stock underlying the stock option (whether vested or unvested) an amount in cash equal to the Merger Consideration minus the exercise price of such stock option, less applicable taxes required to be withheld. If the per share exercise price of a stock option is equal to or greater than the Merger Consideration, the stock option shall terminate and be canceled for no consideration.

Background of the Merger

        Fibrocell's management and the Fibrocell Board regularly review the Company's performance, prospects and strategy in light of the current business and economic environment, as well as developments in the biopharmaceutical industry, and opportunities and challenges facing participants in such industry. From time to time the Fibrocell Board has evaluated and considered a variety of potential strategic alternatives in light of industry developments, economic and market conditions and challenges facing the Company and other participants in the biopharmaceutical industry. These strategic alternatives have included growing the Company's business organically and independently developing its products, as well as potential business combinations, partnerships, acquisitions, divestitures and licensing alternatives.

        In connection with these discussions, a committee comprised of independent members of the Fibrocell Board approved the engagement of Canaccord Genuity in July 2017 to act as its financial advisor in connection with various financial and strategic matters, including advising the Company in

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the event of a potential strategic transaction involving the Company. As part of the ongoing engagement, in March 2018 the Fibrocell Board requested that Canaccord Genuity assist with a comprehensive review of the Company's strategic alternatives. In April 2018, the Company publicly announced that the Fibrocell Board was conducting a comprehensive review of strategic alternatives focused on maximizing stockholder value, that Canaccord Genuity was engaged as its strategic financial advisor for this review process and that the Fibrocell Board had established a special committee (the "strategic alternatives committee") comprised of non-employee directors independent from and not affiliated with Intrexon, the Company's collaboration partner on its gene therapy programs, and a holder of the Company's Preferred Stock and Convertible Notes, to explore and evaluate potential strategic alternatives, including a sale of the Company, a business combination, a merger or reverse merger with another company, a strategic investment into the Company, a sale, license or other disposition of corporate assets of the Company or continuing with the current business plan. As stated in the public announcement, Fibrocell did not set a timetable for completion of the review process.

        As part of this strategic review process, from March 2018 through October 2018, Canaccord Genuity, on the Company's behalf and at the direction of the strategic alternatives committee, contacted 25 potential counterparties that the strategic alternatives committee determined, with the assistance of Canaccord Genuity, were realistic potential strategic partners for a transaction involving the Company. During this time period, the Company entered into confidentiality agreements with nine potential strategic partners, which included customary confidentiality provisions and standstill provisions prohibiting, for at least one year, such potential strategic partners from engaging in certain types of actions, including making an acquisition proposal with respect to the Company without the Company's prior written consent. The standstill provision also prohibited such potential strategic partners from asking for a waiver of the prohibitions, which is commonly referred to as a "don't ask, don't waive" provision. None of these potential partners submitted a proposal involving an acquisition of the Company.

        In October 2018, John Maslowski, President and Chief Executive Officer of the Company, was introduced to Michael Derby, the then Chief Executive Officer of Castle Creek Pharmaceuticals, a wholly-owned subsidiary of Castle Creek, at a disease advocacy fundraiser event. Following this introduction, Mr. Maslowski and the Castle Creek Pharmaceuticals' Chief Executive Officer discussed a potential collaborative transaction involving the Company and Castle Creek Pharmaceuticals. Later in October 2018, Castle Creek Pharmaceuticals approached the Company regarding a potential collaborative transaction involving the Company's lead product candidate, FCX-007, for the treatment of RDEB. On October 24, 2018, the Company entered into a non-disclosure agreement with Castle Creek Pharmaceuticals (the "Confidentiality Agreement"), which included customary confidentiality provisions and a two-year standstill provision prohibiting Castle Creek Pharmaceuticals from engaging in certain types of actions, including making an acquisition proposal with respect to the Company without the Company's prior written consent.

        During November of 2018, the Company and Castle Creek Pharmaceuticals began negotiating a potential agreement regarding the development and commercialization of FCX-007 for the treatment of RDEB. During the course of these negotiations, the Company also requested whether Castle Creek Pharmaceuticals would be interested in making a strategic investment in the Company or an offer to acquire the Company, which opportunity Castle Creek Pharmaceuticals declined.

        During this time, the Company, in consultation with Canaccord Genuity, had also considered the Company's need to raise additional capital to fund its operations, and analyzed its need for funds to bring FCX-007 to market. The Company had typically raised funds for its operations by offering and selling equity-linked securities to investors, including Common Stock, warrants to purchase Common Stock, and Preferred Stock. However, given that continued equity raises would, according to Canaccord Genuity, require significant warrant coverage and result in dilution to the Company's existing stockholders, the Company declined to pursue additional equity financing to fund its operations. In its

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Quarterly Report on Form 10-Q for the quarter ended March 31, 2019, the Company publicly disclosed that, as of March 31, 2019, it had cash and cash equivalents of approximately $11.3 million and that it believed that its cash and cash equivalents at March 31, 2019 and amounts paid or payable to the Company under the Co-Development Agreement, including the April 2019 $7.5 million upfront payment and reimbursement of FCX-007 development cost and the $2.5 million milestone payment for the first patient enrolled in the FCX-007 clinical trial, would be sufficient to fund operations into the third quarter of 2020.

        On April 12, 2019, the Company entered into the Co-Development Agreement with Castle Creek Pharmaceuticals with respect to the development and commercialization of FCX-007 for the treatment of RDEB. Under the terms of the Co-Development Agreement, Castle Creek Pharmaceuticals would receive an exclusive license to commercialize FCX-007 in the United States upon regulatory approval. The Company would maintain responsibility for the development (including pre-launch manufacturing) of FCX-007 through initial regulatory approval of FCX-007, and Castle Creek Pharmaceuticals would be responsible for all post-approval development and commercialization activities for FCX-007. Upon entry into the Co-Development Agreement, the strategic alternatives special committee was disbanded.

        On April 15, 2019, the Company publicly announced that it had entered into the Co-Development Agreement with Castle Creek Pharmaceuticals and that it had concluded the strategic alternatives review process.

        Upon entering into the Co-Development Agreement, members of management of the Company and Castle Creek Pharmaceuticals began working closely on the development of FCX-007 in accordance with the terms of the Co-Development Agreement. Both companies generally are familiar with the other's businesses, and representatives of both companies periodically consult on matters relating to their commercial relationship and the industries in which they operate.

        Following entry into the Co-Development Agreement, the Company and Castle Creek Pharmaceuticals were regularly in communication regarding the Company's operations and potential additional transactions. For example, on May 10, 2019, the parties convened a meeting in Chicago to discuss updates on FCX-007. During this meeting, Jeffrey Aronin, Chairman of the board of directors of Castle Creek Pharmaceuticals, suggested that Castle Creek Pharmaceuticals might consider broader collaborative transactions with the Company. On May 15, 2019, during a telephonic meeting between Mr. Maslowski and Babar Ghias, a representative of Castle Creek Pharmaceuticals, the parties discussed the capitalization of the Company, and later on the same date Sean Buckley, the current Chief Financial Officer and Corporate Secretary of Fibrocell, and Kevin Scoby, a representative of Castle Creek Pharmaceuticals, discussed the Company's outstanding Preferred Stock and the Company's debt structure. Other meetings between the parties around this time were focused on the Company's operations. For example, on May 23, 2019, employees of Castle Creek Pharmaceuticals, including Chief Executive Officer Greg Wujek, met at the Company's headquarters to discuss a supply agreement relating to the Co-Development Agreement. Further, on May 29, 2019, representatives of Castle Creek Pharmaceuticals met at the Company's headquarters to discuss FCX-007 and FCX-013, the Company's investigational, gene therapy candidate for the treatment of moderate to severe localized scleroderma. On June 6, 2019, members of the clinical team at Castle Creek Pharmaceuticals had a discussion with their counterparts at the Company to discuss patient recruitment strategy vendors.

        On June 10, 2019, Mr. Scoby had a telephonic meeting with Mr. Buckley to further discuss the Company's capital structure. Mr. Buckley advised Mr. Scoby that the Company had engaged Canaccord Genuity to act as its exclusive financial advisor with respect to one or more equity offerings or other strategic transactions.

        On June 11, 2019, Mr. Ghias informed Mr. Maslowski that Castle Creek Pharmaceuticals was considering making a private proposal to the Fibrocell Board to acquire all of the Common Stock of

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the Company and to "cash out" the Company's other equity and debt securities. Mr. Ghias noted, however, that the Confidentiality Agreement prohibited Castle Creek Pharmaceuticals from making any such proposal and required that the Company invite Castle Creek Pharmaceuticals to submit a private offer to the Fibrocell Board.

        On June 12, 2019, the Fibrocell Board held a regularly scheduled in-person meeting with members of management present. At that meeting, Mr. Maslowski informed the Fibrocell Board of Castle Creek Pharmaceuticals' consideration of a potential acquisition of all of the Common Stock of the Company. Following a discussion regarding a potential transaction with Castle Creek Pharmaceuticals, the Fibrocell Board authorized management to work with the Company's legal counsel, Hogan Lovells US LLP ("Hogan Lovells"), to prepare a limited waiver of the Confidentiality Agreement that would allow Castle Creek Pharmaceuticals to submit a private proposal to acquire the Company.

        On June 17, 2019, the Company and Castle Creek Pharmaceuticals entered into a limited waiver of the standstill provision contained in the Confidentiality Agreement, which would allow Castle Creek Pharmaceuticals to, within seven days, deliver a private submission to Douglas J. Swirsky, Chairman of the Fibrocell Board, and Mr. Maslowski, of a proposal for a business combination or other similar extraordinary transaction involving the Company or any of its securities. The limited waiver explicitly stated that the Company would be under no obligation to accept any such offer if submitted or to engage in discussions with Castle Creek Pharmaceuticals with respect to any such offer, and would be permitted to reject such offer in the Company's sole and absolute discretion.

        Later on June 17, 2019, the Company received a non-binding offer from Castle Creek Pharmaceuticals to acquire the Company (the "Castle Creek Offer"). The Castle Creek Offer proposed a purchase price of $3.00 per share of Common Stock and contemplated the redemption, effective at closing of the transaction, of the Company's debt and equity-linked instruments for cash or the establishment of arrangements for the conversion or exercise, as applicable, of such instruments for cash, in each case, in accordance with the terms of the applicable instruments. The Castle Creek Offer also indicated that Castle Creek Pharmaceuticals would expect customary support agreements from the Company's significant investors as to all of their interests in the Company and the treatment of those interests in the potential strategic transaction at the Effective Time. The Castle Creek Offer also noted that it would not be conditioned upon obtaining financing.

        On June 18, 2019, Mr. Ghias sent an e-mail to Messrs. Maslowski and Buckley following up on the Castle Creek Offer, requesting permission to speak with major investors in the Company, including Randal J. Kirk and his affiliated entities and MSD, and stating that their support would be necessary for Castle Creek Pharmaceuticals' to proceed with a transaction in order to ensure that all equity-linked securities of the Company could be eliminated in such a transaction. Mr. Buckley responded that any such conversations would require prior approval by the Fibrocell Board.

        On June 19, 2019, the Fibrocell Board held a telephonic special meeting, with members of management and representatives of Hogan Lovells present, to discuss the Castle Creek Offer. At the meeting, representatives of Hogan Lovells provided the members of the Fibrocell Board with an overview of their fiduciary duties and other legal matters to be considered in connection with the Fibrocell Board's review of the Castle Creek Offer. Following discussions regarding the legal responsibilities of the Fibrocell Board, the Fibrocell Board discussed with representatives of Hogan Lovells the advisability of establishing the Special Committee comprised of directors who are independent from and not affiliated with Intrexon, the Company's collaboration partner on its gene therapy programs, and a holder of the Company's Preferred Stock, Convertible Notes and warrants, to review and evaluate the Castle Creek Offer and to oversee any negotiations with Castle Creek Pharmaceuticals. Following this discussion, the Fibrocell Board established the Special Committee consisting of three directors who were independent from and not affiliated with the Kirk Affiliates or MSD—Douglas J. Swirsky, Kelvin D. Moore and Marc B. Mazur—and delegated full power and

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authority of the Fibrocell Board with respect to the Castle Creek Offer or any alternative transaction and to evaluate and negotiate the terms of any transaction with Castle Creek Pharmaceuticals or any alternative transaction. The Special Committee was authorized to take any and all actions necessary or advisable with respect to the Castle Creek Offer or any alternative thereto, including the full authority to manage, respond, negotiate, accept or reject the terms of any such transaction. The Fibrocell Board further resolved not to approve the Castle Creek Offer or any alternative thereto, or recommend any such offer for approval by the Company's stockholders, without the prior favorable recommendation of the Special Committee. Following this action, Mr. Maslowski provided the Fibrocell Board with an update on discussions with representatives from Castle Creek Pharmaceuticals regarding a potential transaction. In addition, Mr. Maslowski discussed with the Fibrocell Board operational matters, including upcoming development milestones for the Company's products, and the Company's liquidity position, including an overview of the Company's cash runway in relation to the Company's development milestones, which was consistent with the Company's public disclosure regarding such milestones at the time but reflected an inability to bring FCX-007 to market without additional funding. Finally, Mr. Maslowski updated the Fibrocell Board on the Company's financing efforts to date, including a review of the Company's anticipated difficulties in attracting investor interest, given the Company's capitalization structure, and the dilutive impact of a successive round of equity financing. Following Mr. Maslowski's presentation, the Fibrocell Board and representatives of Hogan Lovells discussed the process that might be followed by the Special Committee in considering the Castle Creek Offer and Castle Creek Pharmaceuticals' request to communicate with the Kirk Affiliates and MSD regarding the potential transaction in order to obtain the Kirk Affiliates' and MSD's support for the transaction and agreement regarding the treatment of their equity-linked securities in the transaction (including that securities would be cashed out in any such transaction).

        Also on June 19, 2019, immediately following adjournment of the Fibrocell Board's meeting, the Special Committee held a telephonic meeting, with members of management and representatives of Hogan Lovells present, to discuss the Castle Creek Offer. Following a general discussion of the terms of the proposal, the Special Committee authorized Mr. Maslowski to inform Castle Creek Pharmaceuticals that the Special Committee had been established and was reviewing the Castle Creek Offer and the Company would formally respond once the Special Committee had a chance to properly evaluate the Castle Creek Offer. In addition, the Special Committee directed Mr. Maslowski to inform Castle Creek Pharmaceuticals that it was not to have any communications at that time with either MSD, any of the Kirk Affiliates or any of the Company's other stockholders or partners. Prior to adjourning the meeting, the members of the Special Committee agreed to meet again on June 24, 2019 to discuss the proposal with Canaccord Genuity.

        On June 23, 2019, Mr. Maslowski, as directed by the Special Committee, delivered a written response to Mr. Wujek of Castle Creek Pharmaceuticals, informing him that the Company was in receipt of the Castle Creek Offer and that the Special Committee, in consultation with the Company's financial advisors and legal counsel, was considering the Castle Creek Offer and would respond after it had assessed the Castle Creek Offer. The Company's written response also reiterated Castle Creek Pharmaceuticals' obligations under the Confidentiality Agreement.

        On June 24, 2019, the Special Committee held a telephonic meeting with members of management and representatives of Canaccord Genuity and Hogan Lovells. Mr. Maslowski provided the Special Committee with an update on operational matters, including an update on the Company's competitive position in the RDEB market. Following Mr. Maslowski's update, a representative of Canaccord Genuity discussed with the Special Committee the Company's financing efforts, noting that Canaccord Genuity was gauging interest in a potential equity raise and that it would provide additional guidance on investor demand in subsequent weeks. Following this discussion, the Special Committee discussed the Castle Creek Offer, noting that the Special Committee required additional information to properly evaluate the Castle Creek Offer. Following this discussion, the Special Committee authorized

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Messrs. Maslowski and Buckley, with assistance from Canaccord Genuity, to engage in additional discussions with Castle Creek Pharmaceuticals in order to obtain such information.

        Also on June 24, 2019, Mr. Maslowski delivered a written letter to Mr. Wujek. The letter advised Mr. Wujek that the Fibrocell Board had established the Special Committee to consider the Castle Creek Offer and that the Special Committee had authorized management to seek additional information from Castle Creek Pharmaceuticals regarding the Castle Creek Offer, including without limitation, (i) any conditions or assumptions made in the Castle Creek Offer, (ii) Castle Creek Pharmaceuticals' proposed timing to complete the proposed transaction and any contingencies associated therewith, and (iii) Castle Creek Pharmaceuticals' proposed diligence review of the Company. In the letter, Mr. Maslowski suggested setting up a brief call between the Company, Canaccord Genuity, and Castle Creek Pharmaceuticals to address these matters.

        On June 26, 2019, Messrs. Maslowski and Buckley, along with a representative from Canaccord Genuity, met telephonically with Mr. Ghias and Patrick Morris, a representative of Castle Creek Pharmaceuticals, to discuss the Castle Creek Offer in more detail, and to receive clarification on certain elements of the Castle Creek Offer, including financing and time required to conduct due diligence. No negotiations between the parties took place during this call.

        On June 28, 2019, the Special Committee held a telephonic meeting with members of management and representatives of Canaccord Genuity and Hogan Lovells. At the meeting, Mr. Maslowski provided the Special Committee with an update on discussions with Castle Creek Pharmaceuticals, noting that Castle Creek Pharmaceuticals had requested a six-week exclusivity period to complete its due diligence process. Following Mr. Maslowski's update, the Special Committee discussed the Castle Creek Offer with representatives of Hogan Lovells and Canaccord Genuity, including Castle Creek Pharmaceuticals' request for a six-week exclusivity period and determined that this request was not acceptable to the Special Committee. Following this discussion, at the request of the Special Committee, a representative from Canaccord Genuity made a presentation to the Special Committee regarding, among other things, the Company's potential financing prospects in the event it decided not to pursue a transaction with a potential acquirer. The representative from Canaccord Genuity then discussed with the Special Committee the Company's prospects for obtaining financing required to fund operations, noting that due to the Company's capital structure, investors had communicated to Canaccord Genuity that any financing would include significant warrant coverage, resulting in heavy dilution to the Company's stockholders. Following the discussion of the Company's financing prospects, the Special Committee discussed Castle Creek Pharmaceuticals' request for a six-week exclusivity period and authorized Messrs. Maslowski and Buckley, in consultation with Hogan Lovells, to negotiate the terms of an agreement with Castle Creek Pharmaceuticals providing Castle Creek Pharmaceuticals with a period of exclusivity not to exceed three weeks to complete its diligence review process.

        On July 2, 2019, Messrs. Maslowski and Buckley, along with a representative of Canaccord Genuity, met telephonically with Messrs. Ghias, Morris and Wujek and representatives of Latham & Watkins LLP ("Latham & Watkins"), outside legal counsel to Castle Creek Pharmaceuticals. During the meeting, Mr. Maslowski proposed an exclusivity period of two weeks, and explored Castle Creek Pharmaceuticals' willingness to increase the price of the per-share consideration in the Castle Creek Offer, also suggesting that it might be prudent for the parties to postpone negotiations on price until further diligence on the Company could be conducted by Castle Creek Pharmaceuticals. Castle Creek Pharmaceuticals countered with a four-week exclusivity period and noted that they were not willing to discuss a higher price.

        On July 3, 2019, the Special Committee held a telephonic meeting with members of management and representatives of Canaccord Genuity and Hogan Lovells present. At the meeting, Mr. Maslowski updated the Special Committee on the progress of the Company's discussions with Castle Creek Pharmaceuticals. Mr. Maslowski informed the Special Committee that Castle Creek Pharmaceuticals

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was not willing to discuss a price higher than its original offer of $3.00 per share and requested four weeks of exclusivity in order to complete its due diligence review process. A representative from Canaccord Genuity presented the Special Committee with a summary of the Company's recent trading performance and information regarding the premiums paid in recent representative transactions. At the conclusion of the meeting, the Special Committee authorized Messrs. Maslowski and Buckley to negotiate the terms of an agreement with Castle Creek Pharmaceuticals providing Castle Creek Pharmaceuticals with a period of exclusivity not to exceed four weeks. The Special Committee also authorized Messrs. Maslowski and Buckley, in consultation with Canaccord Genuity, to begin negotiations with Castle Creek Pharmaceuticals regarding the price per share to be paid by Castle Creek Pharmaceuticals in a possible acquisition of the Company.

        On July 5, 2019, Messrs. Maslowski and Buckley and a representative from Canaccord Genuity met telephonically with Messrs. Ghias, Morris and Wujek to discuss the Castle Creek Offer. The parties agreed on a four-week exclusivity period. Messrs. Maslowski and Buckley noted that while the Company had not at that time agreed to the price offered, they requested that Castle Creek Pharmaceuticals begin conducting due diligence on the Company as soon as possible.

        On July 8, 2019, Mr. Ghias delivered an initial draft of an exclusivity agreement and addendum to the Confidentiality Agreement (the "Exclusivity Letter") to the Company. From July 8, 2019 to July 15, 2019, representatives of Hogan Lovells and Latham & Watkins negotiated the terms of the Exclusivity Letter.

        On July 11, 2019, upon the instructions of the Special Committee, Canaccord Genuity also contacted five potential strategic partners identified by the Special Committee, based on discussions with and input from Canaccord Genuity, to explore their potential interest in acquiring the Company. None of these parties expressed any interest as a result of these inquiries.

        On July 15, 2019, the Company and Castle Creek Pharmaceuticals entered into the Exclusivity Letter, which provided Castle Creek Pharmaceuticals with exclusivity until August 12, 2019; provided that the exclusivity period would automatically extend until August 26, 2019 unless, on or prior to August 8, 2019, either party provided the other party written notice of the termination of the exclusivity period at the end of its initial term.

        On July 15, 2019, Mr. Scoby delivered an initial due diligence request list to Fibrocell. Over the course of the next several weeks, the Company provided materials and participated in several diligence meetings in response to the initial due diligence requests and supplemental due diligence requests of Latham & Watkins and Castle Creek Pharmaceuticals.

        On July 17, 2019, representatives of Hogan Lovells and Latham & Watkins met telephonically to discuss the Company's capital structure, including its Preferred Stock, Convertible Notes and common stock purchase warrants. Representatives from Latham & Watkins discussed Castle Creek Pharmaceuticals' concern that the Company's Preferred Stock, Convertible Notes and common stock purchase warrants would, pursuant to their terms, remain outstanding following a merger. In particular, representatives of Latham & Watkins noted that certain restrictive covenants under the Securities Purchase Agreement, dated March 7, 2017, by and among the Company and the purchasers named on the signature pages therein (the "Securities Purchase Agreement"), pursuant to which MSD and the Kirk Affiliates acquired the Preferred Stock and certain warrants, would remain applicable to the Company if any such securities remained outstanding. These covenants would survive a merger transaction, and would limit the ability of the Company to operate as part of the Castle Creek Pharmaceuticals business or to obtain or participate in permanent debt financing, as the covenants included, among other restrictions, limitations upon the Company's ability to enter into certain debt facilities and create or assume liens upon any of the Company's assets or properties (the restrictive covenants in the Securities Purchase Agreement collectively, the "restrictive covenants"). Representatives of Latham & Watkins indicated that Castle Creek would likely insist that the restrictive

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covenants be eliminated in any transaction, as they would unreasonably obstruct the growth of the Company's business following the consummation of a merger, including the commercialization of its key products. Representatives of Latham & Watkins further indicated that the survival of these securities, and in particular the restrictive covenants, were the primary reason for Castle Creek Pharmaceuticals' request to speak with MSD and the Kirk Affiliates.

        Also on July 17, 2019, Mr. Buckley and Mr. Ghias met telephonically to discuss initial due diligence items.

        On July 18, 2019, representatives of Castle Creek Pharmaceuticals met employees of the Company, including Messrs. Maslowski and Buckley, at the Company's headquarters to conduct onsite due diligence.

        Representatives of Castle Creek Pharmaceuticals and the Company, and their respective representatives, held successive telephonic meetings on each of July 23, 2019, July 26, 2019 and July 29, 2019 to discuss ongoing due diligence items, including projections for cash burn rates and matters involving the Company's intellectual property.

        On July 23, 2019, in an e-mail from Mr. Ghias to Mr. Maslowski, Castle Creek Pharmaceuticals reiterated its desire to open a dialogue with the Kirk Affiliates and MSD regarding support for the transaction and to obtain certainty that their interests in the Company's securities, including in the Preferred Stock, would be extinguished.

        On July 30, 2019, the Special Committee held a telephonic meeting with members of management and representatives of Hogan Lovells and Canaccord Genuity present. At the meeting, Mr. Maslowski informed the Special Committee that Castle Creek Pharmaceuticals reiterated that it was not willing to discuss a price higher than its initial offer of $3.00 per share to acquire the Company. Mr. Maslowski also updated the Special Committee on the status of Castle Creek Pharmaceuticals' diligence review process, Castle Creek Pharmaceuticals' repeated requests to have discussions with representatives of the Kirk Affiliates and MSD, and Castle Creek Pharmaceuticals' anticipated timing to complete the proposed transaction. The Special Committee discussed the terms of the Castle Creek Offer and the Company's response to Castle Creek Pharmaceuticals regarding the Castle Creek Offer. Following this discussion, the Special Committee determined that, subject to further efforts by Company management to obtain a higher per-share offer from Castle Creek and the receipt of confirmation from Castle Creek that they had delivered their final offer, Mr. Maslowski was authorized to contact Randal J. Kirk on a confidential basis and to inform him of the Castle Creek Offer and to discuss Castle Creek Pharmaceuticals' request to speak with him directly.

        On July 31, 2019, Mr. Swirsky met telephonically with Mr. Ghias. Mr. Swirsky and Mr. Ghias discussed the Company's desire to negotiate with Castle Creek Pharmaceuticals regarding the per share price to be paid by Castle Creek Pharmaceuticals in the Merger. Mr. Ghias reiterated that Castle Creek Pharmaceuticals was not willing to discuss a price higher than its initial offer of $3.00 per share. In addition, Mr. Ghias reiterated Castle Creek Pharmaceuticals' interest in speaking with Mr. Kirk regarding the proposed transaction.

        Also on July 31, 2019, representatives of Hogan Lovells met telephonically with representatives of Latham & Watkins. During this meeting, representatives of Hogan Lovells outlined the process to be followed by Castle Creek Pharmaceuticals in order for the Special Committee to allow Castle Creek Pharmaceuticals to contact Mr. Kirk regarding the proposed transaction.

        On August 3, 2019, the Special Committee held a telephonic meeting with members of management and representatives of Hogan Lovells and Canaccord Genuity present. Mr. Maslowski informed the Special Committee that Castle Creek Pharmaceuticals refused to increase its offer above $3.00 per share. A representative from Canaccord Genuity provided an overview of Canaccord Genuity's preliminary financial analysis of the Castle Creek Offer. In addition, a representative from

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Canaccord Genuity reviewed the Company's prospective financing options in the event the Company decided not to pursue a strategic transaction with a potential acquirer. Following this presentation, the Special Committee authorized Mr. Maslowski to respond to Castle Creek Pharmaceuticals with a counteroffer of $3.40 per share.

        Also on August 3, 2019, Mr. Maslowski and representatives of Canaccord Genuity met telephonically with Messrs. Ghias and Wujek to inform Castle Creek Pharmaceuticals of the Company's counteroffer of $3.40 per share. Messrs. Ghias and Wujek confirmed that its initial offer of $3.00 per share was Castle Creek Pharmaceuticals' final offer to acquire the Company.

        On August 4, 2019, as directed by the Special Committee following confirmation of a final offer price from Castle Creek, Mr. Maslowski contacted Mr. Kirk via e-mail and requested his availability for a telephone conference to discuss a potential update regarding the Company. On August 5, 2019, Messrs. Maslowski and Swirsky participated in a teleconference with Mr. Kirk, during which Messrs. Maslowski and Swirsky provided details regarding the potential transaction with Castle Creek Pharmaceuticals and advised Mr. Kirk on the status of negotiations regarding the potential transaction. The discussion was made pursuant to an existing confidentiality agreement between Mr. Kirk, as a representative of Intrexon, and Fibrocell. In response to questions from Mr. Kirk, Messrs. Maslowski and Swirsky discussed Fibrocell's capital structure, the cash runway required to obtain approval of FCX-007, and the challenges of raising additional funds via equity financing due to lack of investor demand and the dilutive impact on the Company's stockholders. Mr. Kirk indicated that he understood the Company's position and expressed initial support of the potential transaction. Mr. Kirk also agreed to speak to Castle Creek Pharmaceuticals and its representatives at a later date to discuss the transaction.

        On August 6, 2019, the Company and Castle Creek Pharmaceuticals executed a consent and limited waiver of the standstill provision in the Confidentiality Agreement permitting representatives of Castle Creek Pharmaceuticals to have one or more private discussions with representatives of the Kirk Affiliates regarding a potential acquisition of the Company by Castle Creek Pharmaceuticals or its affiliates.

        On August 8, 2019, Mr. Kirk and Mr. Aronin had a telephonic meeting to discuss the Castle Creek Offer, including Castle Creek Pharmaceutical's strategic rationale for pursuing the transaction. Mr. Aronin also reiterated that the support of the Kirk Affiliates was an integral part of the transaction. Mr. Kirk indicated that he was supportive of the transaction and the Castle Creek Offer.

        On August 9, 2019, Mr. Buckley and a representative of BDO USA LLP ("BDO"), one of the Company's financial reporting consultants, met telephonically with Andrea Kistner, Senior Director of Accounting of Castle Creek Pharmaceuticals, and representatives of Deloitte & Touche LLP ("Deloitte") to discuss accounting due diligence.

        On August 14, 2019, representatives of Hogan Lovells and Latham & Watkins met telephonically to discuss the Merger Agreement, Castle Creek Pharmaceuticals' request to contact and obtain the support of the Kirk Affiliates and MSD prior to signing the Merger Agreement and outstanding diligence matters.

        On August 16, 2019, Mr. Buckley and a representative of BDO had another telephonic meeting with Ms. Kistner of Castle Creek Pharmaceuticals and representatives of Deloitte to discuss accounting due diligence.

        On August 20, 2019, Latham & Watkins distributed an initial draft of the Merger Agreement to Hogan Lovells. The proposed draft contemplated a subsidiary merger, with a subsidiary of Castle Creek Pharmaceuticals merging with and into the Company, with the Company surviving the merger. The draft Merger Agreement provided for, among other things, (i) customary no-shop and fiduciary out provisions, (ii) a termination fee payable by the Company under certain circumstances equal to 4.25%

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of the enterprise value of the transaction, (iii) reimbursement of Castle Creek's expenses by the Company in the event the Merger Agreement was terminated under certain circumstances and (iv) conditions to Castle Creek's obligation to complete the Merger related to stockholder litigation, the validity of certain of the Company's agreements with Intrexon and the exercise of appraisal rights by a certain percentage threshold of the Company's common or preferred stockholders.

        Over the course of the next several weeks, the Company and Castle Creek Pharmaceuticals, together with their respective legal and financial advisors, continued to negotiate the Merger Agreement and related transaction documentation.

        During this period, Castle Creek Pharmaceuticals requested permission at various times to speak to representatives of MSD about entry into a support agreement for the transaction, including via e-mail from Mr. Ghias to Mr. Maslowski on each of August 20, August 28, and September 1, 2019. At each juncture, the Company responded that such permission was subject to the approval of the Special Committee.

        On August 21, 2019, representatives of Hogan Lovells and Latham & Watkins participated in a telephonic meeting to discuss the draft Merger Agreement and transaction process, including the request to discuss the proposed transaction and a support agreement with MSD. Representatives of Latham & Watkins again raised the issue of the restrictive covenants, noting that obtaining MSD's agreement to be cashed out in any transaction was essential to Castle Creek Pharmaceuticals.

        Also on August 21, 2019, Mr. Buckley and a representative of BDO met telephonically with Ms. Kistner and representatives of Deloitte and Grant Thornton LLP regarding tax due diligence.

        Also on August 21, 2019, Mr. Maslowski informed the Special Committee that Castle Creek Pharmaceuticals had once again requested permission to discuss the proposed transaction and a support agreement with MSD.

        On August 25, 2019, Latham & Watkins delivered to Hogan Lovells a draft letter extending Castle Creek Pharmaceuticals' exclusivity period by an additional two weeks through September 9, 2019 (the "Exclusivity Amendment").

        On August 26, 2019, the Special Committee held a telephonic meeting with members of management and representatives of Hogan Lovells and Canaccord Genuity present. During the meeting, Mr. Maslowski updated the Special Committee on the status of the potential transaction with Castle Creek Pharmaceuticals, including the status of Castle Creek Pharmaceuticals' diligence review process and the Company's receipt of an initial draft of the Merger Agreement. Following Mr. Maslowski's update, representatives of Hogan Lovells discussed with the Special Committee the terms of the Merger Agreement. Following this discussion, the Special Committee instructed Hogan Lovells to prepare a revised draft of the Merger Agreement in accordance with the Special Committee's guidance and to circulate the revised draft to Castle Creek Pharmaceuticals and Latham & Watkins. At this meeting, the Special Committee also discussed an extension to the exclusivity period the Company had previously agreed to with Castle Creek Pharmaceuticals, which was due to expire on August 26, 2019. Following this discussion, the Special Committee authorized Messrs. Maslowski and Buckley to enter into the Exclusivity Amendment with Castle Creek Pharmaceuticals.

        Later on August 26, 2019, the Company and Castle Creek Pharmaceuticals entered into the Exclusivity Amendment.

        On August 27, 2019, Hogan Lovells distributed a revised draft of the Merger Agreement to Latham & Watkins. The revised draft provided that, among other things: (i) the termination fee payable by the Company would be equal to 3% of the enterprise value of the transaction, (ii) removal of the requirement of the Company to reimburse Castle Creek's expenses in the event the Merger

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Agreement is terminated under certain circumstances, (iii) removal of the conditions to Castle Creek's obligation to complete the Merger related to stockholder litigation, the validity of certain of the Company's agreements with Intrexon and the exercise of appraisal rights by a certain percentage threshold of the Company's common or preferred stockholders and (iv) certain modifications to the no shop and fiduciary out provisions.

        Also on August 27, 2019, Latham & Watkins distributed to Hogan Lovells initial drafts of the voting and support agreement (the "support agreement") for the Kirk Affiliates and the form of equity financing commitment letter. The support agreement included, among other things, obligations of the Kirk Affiliates to cause their shares of Preferred Stock and certain warrants to be converted into the right to receive the merger consideration in accordance with the Merger Agreement and the Certificate of Designations of the Preferred Stock, and certain other warrants to be repurchased at their Black-Scholes value at the closing of the Merger. The conversion or repurchase (as applicable) of the Preferred Stock and warrants would eliminate all outstanding Preferred Stock and warrants purchased under the Securities Purchase Agreement, and as such would terminate the restrictive covenants. The support agreement also required the Kirk Affiliates to tender their Convertible Notes to Castle Creek in the event it conducted a tender offer for such notes (subject to certain qualifications regarding the terms of such tender offer).

        On August 28, 2019, Mr. Buckley and a representative of BDO held a telephonic meeting with Messrs. Ghias and Scoby to discuss the Company's capital structure.

        On August 29, 2019, representatives of Hogan Lovells and Latham & Watkins met telephonically. Latham & Watkins discussed with Hogan Lovells the terms of the Merger Agreement, including Castle Creek Pharmaceuticals' proposed changes. In addition, Latham & Watkins again requested the ability to communicate with MSD regarding the potential transaction in order to obtain MSD's support for the transaction and agreement regarding the treatment (and conversion or repurchase, as applicable) of its equity-linked securities in the transaction. Hogan Lovells expressed the Fibrocell Board's concern that MSD may seek to leverage Castle Creek's desire to ensure MSD's securities were cashed out in the merger to obtain additional concessions from Castle Creek. Latham & Watkins suggested that Castle Creek may be amenable to delaying contact with MSD until the principal terms of the Merger Agreement had been agreed by the Company and Castle Creek Pharmaceuticals, if those terms were resolved expeditiously.

        Following this meeting, on August 29, 2019, Latham & Watkins distributed to Hogan Lovells a revised draft of the Merger Agreement. The revised draft provided for, among other things, (i) the termination fee payable by the Company would be equal to 4% of the enterprise value of the transaction, (ii) the requirement of the Company to reimburse Castle Creek's expenses in the event the Merger Agreement is terminated under certain circumstances, (iii) conditions to Castle Creek's obligation to complete the Merger related to stockholder litigation, the validity of certain of the Company's agreements with Intrexon and the exercise of appraisal rights by a certain percentage threshold of the Company's common or preferred stockholders and (iv) certain modifications to the no-shop and fiduciary out provisions.

        On August 29, 2019, Messrs. Maslowski and Kirk corresponded via e-mail regarding the Kirk Affiliates' entry into the support agreement and Mr. Maslowski forwarded a draft of the support agreement to Mr. Kirk for his review. Mr. Kirk instructed Mr. Maslowski to instruct Hogan Lovells to work directly with his representatives at the Kirk Affiliates to review and negotiate entry into the support agreement.

        Also on August 29, 2019, Hogan Lovells distributed to Latham & Watkins a revised draft of the form of equity financing commitment letter.

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        Later on August 29, 2019, representatives of Hogan Lovells delivered a draft of the support agreement to representatives of the Kirk Affiliates.

        On August 30, 2019, representatives of Hogan Lovells met telephonically with representatives of the Kirk Affiliates to discuss the draft support agreement distributed by Latham & Watkins. The Kirk Affiliates advised Hogan Lovells that they would only consent to an agreement that afforded them the same economic treatment of their Preferred Stock as MSD would receive for its Preferred Stock. Following this meeting, Hogan Lovells distributed a revised draft of the support agreement for the Kirk Affiliates, which reflected input from the Kirk Affiliates, to Latham & Watkins. Hogan Lovells also distributed to Latham & Watkins an initial draft of the Company's disclosure schedules to the Merger Agreement.

        Also on August 30, 2019, Mr. Buckley and representatives of Hogan Lovells and Latham & Watkins met telephonically. Hogan Lovells discussed with Latham & Watkins the terms of the Merger Agreement, including those terms in the revised draft distributed by Latham & Watkins on August 29 that were not acceptable to the Company. In addition, Latham & Watkins discussed with Hogan Lovells the revised draft of the Kirk Affiliates' support agreement distributed by Hogan Lovells. Following this discussion, Hogan Lovells informed Latham & Watkins that the Company had authorized Castle Creek Pharmaceuticals to contact the Kirk Affiliates directly to negotiate the terms of the support agreement.

        On August 30, 2019, Messrs. Buckley and Maslowski and a representative of BDO had a telephonic meeting with Mr. Ghias, Ms. Kistner and other representatives of Castle Creek Pharmaceuticals to discuss certain tax diligence questions regarding the Company's subsidiary, Isolagen International, S.A.

        On September 2, 2019, the Special Committee held a telephonic meeting, with members of management and representatives of Hogan Lovells present. During the meeting, representatives of Hogan Lovells discussed with the Special Committee the status of negotiations with Castle Creek Pharmaceuticals and reviewed the terms of the revised draft Merger Agreement distributed by Latham & Watkins. Following this discussion, the Special Committee instructed Hogan Lovells to prepare a revised draft of the Merger Agreement in accordance with the Special Committee's guidance and to circulate the revised draft to Castle Creek Pharmaceuticals and Latham & Watkins. Representatives of Hogan Lovells then updated the Special Committee on the status of negotiations between Castle Creek Pharmaceuticals and the Kirk Affiliates regarding the support agreement and that Castle Creek Pharmaceuticals may be amenable to delaying contact with MSD until the principal terms of the Merger Agreement had been finalized. The Special Committee authorized Hogan Lovells to inform Latham & Watkins that Castle Creek Pharmaceuticals could contact MSD to negotiate the terms of a support agreement once the parties agreed to the principal terms of the Merger Agreement.

        Also on September 2, 2019, Hogan Lovells distributed to Latham & Watkins a revised draft of the Merger Agreement, which provided for, among other things, (i) the termination fee payable by the Company would be equal to 3.5% of the enterprise value of the transaction, (ii) the removal of the requirement of the Company to reimburse Castle Creek's expenses in the event the Merger Agreement is terminated under certain circumstances, and (iii) the removal of the conditions to Castle Creek's obligation to complete the Merger related to stockholder litigation and the exercise of appraisal rights by a certain percentage threshold of the Company's preferred stockholders.

        On September 3, 2019, representatives of Latham & Watkins met telephonically with representatives of the Kirk Affiliates regarding the support agreement. Following those discussions, Latham & Watkins provided a revised draft of the support agreement to the Kirk Affiliates. The revised support agreement updated the terms of the Kirk Affiliates' obligation to support the transaction and clarified certain non-solicit and similar post-closing covenants applicable to the Kirk

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Affiliates, but did not modify the treatment of the securities of the Company held by the Kirk Affiliates.

        Also on September 3, 2019, representatives of Hogan Lovells met telephonically with representatives of Latham & Watkins regarding the latest revised draft of the Merger Agreement and Castle Creek Pharmaceuticals' request to contact MSD. With respect to the closing conditions concerning stockholder litigation and the exercise of appraisal rights by holders of the Company's Preferred Stock, which the Company proposed to eliminate, representatives of Latham & Watkins informed Hogan Lovells that this issue could not be resolved until Castle Creek Pharmaceuticals obtained MSD's cooperation and support for the transaction and the conversion or repurchase (as applicable) of MSD's Preferred Stock and warrants. Further, representatives of Latham & Watkins noted Castle Creek Pharmaceuticals' concern that by postponing communications with MSD until the other open issues were resolved, the parties would further delay the transaction and Castle Creek Pharmaceuticals was accordingly requesting authorization to contact MSD as soon as possible.

        Later on September 3, 2019, representatives of Hogan Lovells met telephonically with Messrs. Maslowski, Buckley and Swirsky regarding Castle Creek Pharmaceuticals' request to contact MSD. Given that the terms of the Merger Agreement had been substantially agreed upon, pending resolution of the appraisal and litigation closing conditions, Mr. Swirsky agreed to allow Castle Creek Pharmaceuticals to contact MSD at that time, subject to approval of the other members of the Special Committee. Following this meeting, each of the members of the Special Committee confirmed via electronic mail their agreement with allowing Castle Creek Pharmaceuticals to contact MSD at that time in light of the fact that the terms of the Merger Agreement had been substantially agreed.

        Later on September 3, 2019, Messrs. Maslowski and Swirsky had a telephonic meeting with Scott Segal, Managing Director of the Credit Opportunities Group at MSD Partners, L.P., an affiliate of MSD. Messrs. Maslowski and Swirsky informed Mr. Segal that they would like to discuss a potential development regarding the Company, but that the parties would first need to enter into a confidentiality agreement. Following this conversation, the Company and MSD negotiated and entered into a confidentiality agreement the same day.

        Following execution of the confidentiality agreement on September 3, 2019, Messrs. Maslowski and Buckley had a telephonic meeting with Mr. Segal, whereupon Mr. Segal was informed of the potential transaction and the parties agreed to speak at a later time to discuss the transaction in more detail. During this call, the parties also discussed the Company's capitalization structure.

        On September 3, 2019, representatives of Hogan Lovells again met telephonically with representatives of Latham & Watkins. Latham & Watkins discussed with Hogan Lovells the terms of the Merger Agreement, including those terms in the revised draft distributed by Hogan Lovells on September 2 that Castle Creek Pharmaceuticals would not agree to. In addition, Latham & Watkins again informed Hogan Lovells that Castle Creek Pharmaceuticals would be unlikely to proceed with the proposed transaction without MSD agreeing to enter into a support agreement in connection with the transaction in light of the constraints imposed by the restrictive covenants on the intended permanent financing and capital structure of Castle Creek and the Company.

        Also on September 3, 2019, Latham & Watkins distributed to Hogan Lovells a revised draft of the Merger Agreement. The draft Merger Agreement provided for, among other things, (i) the termination fee payable by the Company would be equal to 3.75% of the enterprise value of the transaction, (ii) the requirement of the Company to reimburse Castle Creek's expenses in the event the Merger Agreement is terminated under certain circumstances, and (iii) conditions to Castle Creek's obligation to complete the Merger related to stockholder litigation and the exercise of appraisal rights by a certain percentage threshold of the Company's common or preferred stockholders.

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        Later on September 3, 2019, the Company and Castle Creek Pharmaceuticals agreed to the form of equity financing commitment letter.

        On September 4, 2019, Messrs. Swirsky and Maslowski had a telephonic meeting with Mr. Segal and Robert Platek, Portfolio Manager of the Credit Opportunities Group at MSD Partners, L.P., in which Messrs. Swirsky and Maslowski provided additional information regarding the potential transaction and requested MSD's support. Messrs. Segal and Platek expressed initial optimism regarding a potential transaction and discussed the terms of the transaction with Messrs. Swirsky and Maslowski. Messrs. Segal and Platek further noted that MSD understood its shares of Preferred Stock would survive the transaction, and were willing to roll their Preferred Stock and warrants into the surviving corporation. However, they further noted that MSD would be willing to convert or sell the Preferred Stock and warrants in the transaction (with such conversion and sale, together with the conversion or sale (as applicable) of the Preferred Stock and warrants held by the Kirk Affiliates, resulting in the elimination of the restrictive covenants) for additional payments in excess of what was provided in the Certificate of Designation establishing the Preferred Stock. The parties then agreed to set up a call between MSD and Castle Creek Pharmaceuticals and MSD agreed to review a draft support agreement.

        On September 4, 2019, the Company and Castle Creek Pharmaceuticals expressly consented to waive the confidentiality and exclusivity provisions of the Confidentiality Agreement for the limited purpose of Castle Creek Pharmaceuticals negotiating a support agreement with representatives of MSD.

        Later on September 4, 2019, Latham & Watkins delivered a revised draft of the Merger Agreement to Hogan Lovells.

        On September 5, 2019, the Special Committee held a telephonic meeting, with members of management and representatives of Hogan Lovells present. Mr. Maslowski updated the Special Committee on the discussions he and Mr. Swirsky had with representatives of MSD regarding the support agreement, noting that the representatives from MSD indicated MSD would be willing to enter into a support agreement, including the conversion or repurchase (as applicable) of the Preferred Stock and the warrants; however, in order to do so, MSD would require a payment in excess of what was provided in the draft Merger Agreement and the Certificate of Designations establishing the Preferred Stock if its interests were to be eliminated entirely in the Merger. Following Mr. Maslowski's update, representatives of Hogan Lovells discussed with the Special Committee the status of negotiations with Castle Creek Pharmaceuticals and reviewed the terms of the revised draft Merger Agreement distributed by Latham & Watkins. Following this discussion, the Special Committee instructed Hogan Lovells to prepare a revised draft of the Merger Agreement in accordance with the Special Committee's guidance and to circulate the revised draft to Castle Creek Pharmaceuticals and Latham & Watkins.

        Also on September 5, 2019, Messrs. Maslowski and Buckley and representatives of Hogan Lovells met telephonically with Mr. Ghias and representatives of Latham & Watkins regarding the Company's discussions with MSD. The parties discussed MSD's initial expectations regarding payment of their Preferred Stock, including their initial expectation that they would receive the stated value of the Preferred Stock if their interests were to be eliminated entirely in the Merger. Mr. Maslowski agreed to coordinate a meeting between representatives of Castle Creek Pharmaceuticals and MSD.

        On September 5, 2019, Mr. Buckley also met telephonically with Mr. Ghias regarding the open items in the Merger Agreement: the obligation of the Company to reimburse Castle Creek's expenses in certain circumstances and the closing conditions related to stockholder litigation and the exercise of appraisal rights by the holders of the Company's Preferred Stock. During this meeting, Mr. Buckley and Mr. Ghias agreed, among other things, that the requirement of the Company to reimburse Castle Creek Pharmaceuticals for its expenses under certain circumstances would be removed from the

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agreement and that, subject to MSD and the Kirk Affiliates entering into a support agreement, the closing conditions related to stockholder litigation and the exercise of appraisal rights by a certain percentage threshold of the holders of Preferred Stock would also be removed from the agreement (while the condition relating to the exercise of appraisal rights by a certain percentage threshold of the holders of Common Stock would remain in the agreement).

        On September 6, 2019, Hogan Lovells distributed to Latham & Watkins a revised draft of the Merger Agreement. The draft Merger Agreement provided for, among other things, a termination fee of 3.75% of the enterprise value of the transaction and reflected the terms agreed to by Messrs. Buckley and Ghias during their September 5, 2019 meeting.

        On September 6, 2019, Messrs. Maslowski and Swirsky met telephonically with Mr. Segal to further discuss the treatment of MSD's Preferred Stock and entry into a support agreement. During this meeting, Mr. Segal suggested alternative payment structures for the Preferred Stock, including that the Company reduce the consideration paid to holders of Common Stock in order to increase the consideration paid to holders of the Preferred Stock, or that the Preferred Stock would simply remain outstanding in the Surviving Corporation after the Merger. When informed that these options were likely unacceptable, Mr. Segal then noted that MSD would be willing to convert its Preferred Stock and cause its warrants to be repurchased (with such conversion and repurchase, together with the conversion or repurchase (as applicable) of the Preferred Stock and warrants held by the Kirk Affiliates, resulting in the elimination of the restrictive covenants) in the transaction if compensation payable to the holders of the Company's Preferred Stock in the transaction were to be increased such that the aggregate payment to such holders would be $7 million (compared to the approximate aggregate payment of $2.3 million payable to the holders of the Preferred Stock contemplated at the time under the terms of the draft Merger Agreement, representing the consideration due to the holders of Preferred Stock if such Preferred Stock was converted in accordance with the Certificate of Designations for the Preferred Stock).

        Later on September 6, 2019, representatives of Latham & Watkins had a telephonic meeting with representatives of Hogan Lovells. Hogan Lovells relayed MSD's requests and proposed alternatives from the earlier call among Messrs. Swirsky, Maslowski and Segal. Following a discussion of MSD's requests, representatives of Latham & Watkins indicated to representatives of Hogan Lovells that although Castle Creek Pharmaceuticals was not willing to pay holders of Common Stock more than $3.00 per share, it may be willing to pay a fee to MSD and the Kirk Affiliates as consideration for MSD and the Kirk Affiliates agreeing to eliminate the restrictive covenants. Representatives of Latham & Watkins again reiterated Castle Creek Pharmaceuticals' position that it would not enter into a transaction to acquire the Company unless MSD and the Kirk Affiliates agreed to cash-out their respective equity interests in the Company, and that it would not alter the consideration payable to holders of Common Stock.

        On September 7, 2019, Mr. Maslowski met telephonically with Mr. Platek to determine his willingness and availability to discuss the support agreement with Castle Creek Pharmaceuticals directly. Mr. Platek agreed to hold a telephonic meeting and provided his availability. On September 7, 2019 Mr. Maslowski conveyed his availability to representatives of Castle Creek Pharmaceuticals and informed them to coordinate directly with Mr. Platek.

        On September 8, 2019, Messrs. Platek and Segal met telephonically with representatives of Castle Creek Pharmaceuticals to discuss treatment of the Preferred Stock and warrants held by MSD in the transaction and the support agreement. Castle Creek Pharmaceuticals and MSD discussed Castle Creek Pharmaceuticals' proposal for the treatment of the Company's Preferred Stock and warrants and the elimination of the restrictive covenants in the transaction. Specifically, Castle Creek Pharmaceuticals proposed that, in addition to the cash Conversion Amount to which holders of Preferred Stock would be entitled to receive under the terms of the Merger Agreement and the Certificate of Designations for

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the Preferred Stock, holders of Preferred Stock would receive a promissory note issued by Merger Sub immediately prior to the Effective Time in exchange for the termination of the Securities Purchase Agreement (thereby eliminating the restrictive covenants) immediately prior to the Merger. The promissory notes to be issued by Merger Sub to MSD and the Kirk Affiliates immediately prior to the Effective Time would be in an aggregate principal amount equal to the aggregate Conversion Amount payable to holders of the Preferred Stock pursuant to the terms of the Merger Agreement and the Certificate of Designations for the Preferred Stock. In an email from Mr. Ghias to Mr. Segal, Castle Creek Pharmaceuticals followed up on such discussion to propose that such notes would have a six-month term and a rate of 8% per annum.

        On September 9, 2019, the Fibrocell Board held a telephonic combined special meeting with the Special Committee, with members of management and representatives of Hogan Lovells present. Mr. Maslowski updated the Fibrocell Board on negotiations with Castle Creek Pharmaceuticals. In addition, the Fibrocell Board discussed the status of negotiations with MSD and the Kirk Affiliates regarding the execution of support agreements in connection with the proposed transaction. Following this discussion, the Fibrocell Board authorized Messrs. Maslowski and Buckley, in conjunction with Hogan Lovells, to continue negotiations with Castle Creek Pharmaceuticals. In addition, the Fibrocell Board agreed to allow Castle Creek Pharmaceuticals to continue to negotiate directly with MSD regarding the treatment of the Company's Preferred Stock in the Merger and elimination of the restrictive covenants.

        Later on September 9, 2019, Hogan Lovells delivered a revised draft of the support agreement for the Kirk Affiliates to Latham & Watkins.

        Later on September 9, 2019, representatives of Hogan Lovells and Latham & Watkins met telephonically to discuss, among other things, Castle Creek Pharmaceuticals' negotiations with MSD. During this meeting, representatives of Latham & Watkins informed representatives of Hogan Lovells that MSD had agreed to execute a support agreement in exchange for a note to be issued to MSD; however, the terms and amount of such note had not yet been finalized. Representatives of Hogan Lovells noted that the Kirk Affiliates would expect the same consideration.

        Also on September 9, 2019, Mr. Buckley met telephonically with Mr. Ghias to discuss the Company's financing requirements in the event the Merger is not consummated by January 31, 2020. Mr. Buckley informed Mr. Ghias that at the Company's current burn rate, after giving effect to the non-recurring transaction expenses related to the Merger, the Company would require additional funding to continue operations past early 2020. Mr. Buckley initially proposed that the Company be permitted to pursue an equity capital raise beginning in early January 2020 in an effort to provide the Company with sufficient funds to continue operations into the second quarter of 2020. Rather than permit the Company to conduct a capital raise, Mr. Ghias discussed with Mr. Buckley that the parties should explore with their respective counsel whether, in the event the Merger is not consummated by January 31, 2020, Castle Creek Pharmaceuticals could advance funds to the Company, representing certain future payments to be made by Castle Creek Pharmaceuticals pursuant to the terms of the Co-Development Agreement.

        On September 10, 2019, Mr. Buckley met telephonically with Mr. Scoby to further discuss the Company's capital structure.

        Also on September 10, 2019, representatives of Hogan Lovells and Latham & Watkins met telephonically to discuss the Company's financing needs in the event the Merger is not consummated by January 31, 2020. Representatives of Latham & Watkins discussed with representatives of Hogan Lovells that Castle Creek Pharmaceuticals would likely not be able to advance funds to the Company due to restrictions under the Company's Convertible Notes, but Castle Creek Pharmaceuticals would be willing to permit the Company to pursue an equity capital raise in the event the Merger is not consummated by January 31, 2020.

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        Also on September 10, 2019, in light of the requirement previously stated by the Kirk Affiliates that they receive the same economic treatment as MSD and the need previously stated by Castle Creek Pharmaceuticals to obtain the Kirk Affiliates' consent to eliminate the restrictive covenants, representatives of Latham & Watkins and the Kirk Affiliates met telephonically to discuss the voting and support agreement and a consent and termination agreement (the "termination agreement") with respect to the Securities Purchase Agreement, on similar terms proposed to MSD. Between September 10, 2019 and September 12, 2019, representatives of Latham & Watkins exchanged drafts of the voting and support agreement, termination agreement and promissory note with representatives of MSD and the Kirk Affiliates. The respective termination agreements with MSD and the Kirk Affiliates ultimately reflected the same economic terms proposed to MSD on September 8, 2019, as discussed between Latham & Watkins and Hogan Lovells.

        Also between September 10, 2019 and September 11, 2019, Hogan Lovells and Latham & Watkins exchanged multiple drafts of the Merger Agreement and disclosure schedules in order to finalize those documents. On September 11, 2019, Mr. Buckley and representatives of Hogan Lovells met telephonically with Mr. Ghias and Ms. Kistner and representatives of Latham & Watkins regarding the Company's disclosure schedules.

        On September 11, 2019, Latham & Watkins distributed to Hogan Lovells updated drafts of the forms of termination agreements and voting and support agreements that Castle Creek Pharmaceuticals proposed to enter into with MSD and the Kirk Affiliates. Representatives of Latham & Watkins also indicated that the termination agreements and voting and support agreements were in substantially final form based on Castle Creek Pharmaceuticals' negotiations with representatives of such parties.

        Also on September 11, 2019, representatives of Hogan Lovells and Latham & Watkins met telephonically regarding the Company's financing needs in the event the Merger is not consummated by January 31, 2020. Representatives of Hogan Lovells proposed that if the Company is able to obtain all required third party consents, Castle Creek Pharmaceuticals would, no later than January 31, 2020, advance funds to the Company, representing certain future payments to be made by Castle Creek Pharmaceuticals pursuant to the terms of the Co-Development Agreement and, in the event the Company is unable to obtain all required third party consents by January 15, 2020, the Company would be permitted to raise additional capital through the sale and issuance of equity securities of the Company in an offering that would not sign or close until a date after the Outside Date of the Merger. Later on September 11, 2019, Hogan Lovells and Latham & Watkins exchanged drafts of the Company's disclosure schedules and a side letter agreement that reflected these terms as well as a limit of $3 million on the amount of the Castle Creek Pharmaceuticals' advance and a limit of $3 million on the amount of equity capital to be raised.

        On September 12, 2019, the Special Committee held a telephonic meeting with members of management and representatives of Hogan Lovells and Canaccord Genuity present. A representative of Hogan Lovells updated the Special Committee on Castle Creek Pharmaceuticals' negotiations with MSD, noting that the notes to be issued to MSD and the Kirk Affiliates as consideration for entering into the termination agreements (in addition to the cash consideration MSD and the Kirk Affiliates would receive in connection with the Merger pursuant to the terms of the Merger Agreement and the Certificate of Designation of the Preferred Stock) would have a six month term, a rate of 8% per annum and an aggregate principal amount equal to the aggregate Conversion Amount payable to holders of the Preferred Stock pursuant to the terms of the Merger Agreement and the Certificate of Designations for the Preferred Stock and that the Kirk Affiliates would be receiving the same treatment for their Preferred Stock as MSD would for its Preferred Stock. A representative of Hogan Lovells reminded the Special Committee of their fiduciary duties and advised that directors Julian Kirk and Marcus E. Smith may want to voluntarily recuse themselves and not participate in the upcoming Fibrocell Board meeting due to their affiliation with the Kirk Affiliates. Representatives of Hogan Lovells reviewed the terms of the proposed Merger Agreement, with a particular focus on the terms

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relating to the Company's representations and warranties, interim operating covenants, the "no-shop" and "fiduciary out" provisions, closing conditions, termination fees and termination rights, and the negotiations over those terms. The Special Committee discussed the terms of the proposed Merger Agreement and the implications of and rationale for the consideration to be provided to MSD and the Kirk Affiliates in connection with the termination agreement. The Special Committee discussed how this additional consideration was essential to MSD and the Kirk Affiliates' willingness to agree to Castle Creek's requests, and therefore essential to the completion of the transaction, and that without completion of the transaction, the holders of Common Stock would not benefit. Following this discussion, a representative of Canaccord Genuity reviewed Canaccord Genuity's financial analyses of the proposed consideration of $3.00 per share in cash to be received by holders of Fibrocell's Common Stock in the merger, and noted that Canaccord Genuity was prepared to deliver a written fairness opinion to the Fibrocell Board following the upcoming Fibrocell Board meeting. Following consideration of the matters discussed during the course of the Special Committee meeting, the Special Committee unanimously (i) determined that it was fair to, advisable and in the best interests of the Company and the holders of Fibrocell's Common Stock for the Company to enter into the Merger Agreement and effect the Merger and the other transactions contemplated thereby, (ii) subject to the Fibrocell Board's receipt of a fairness opinion from Canaccord Genuity, recommended that the Fibrocell Board declare the Merger advisable and approve, on behalf of the Company, the Merger Agreement, and the negotiation, execution, delivery and performance of the Merger Agreement and the transactions contemplated thereby, (iii) recommended that the Fibrocell Board approve entry into termination agreements with each of MSD and the Kirk Affiliates, (iv) recommended that the Fibrocell Board submit the Merger Agreement to the Company's stockholders for consideration and approval at a meeting of such stockholders and recommend to the stockholders of the Company approval of the Merger Proposal, the Compensation Proposal and the Adjournment Proposal, and (v) authorized, approved, adopted and ratified the Company's previous letter agreements between Fibrocell and Castle Creek Pharmaceuticals regarding exclusivity.

        Later on September 12, 2019, the Fibrocell Board held a telephonic special meeting. All members of the Fibrocell Board, including Christine St. Clare, participated in the meeting, with the exception of Messrs. Kirk and Smith. In addition, members of management and representatives of Hogan Lovells and Canaccord Genuity participated in the meeting. A representative of Hogan Lovells reminded the Fibrocell Board of their fiduciary duties and advised that directors Julian Kirk and Marcus E. Smith had voluntarily recused themselves and chosen not participate in the Fibrocell Board meeting due to their affiliation with the Kirk Affiliates. The representative of Hogan Lovells explained that it was advisable that Messrs. Kirk and Smith recuse themselves and not participate in the Fibrocell Board meeting as they had a financial interest in the transaction due to their employment by Third Security, LLC, which is owned by Randal J. Kirk and a party to the Kirk Affiliates' termination agreement and support agreement. However, the representative of Hogan Lovells advised that Ms. St. Clare should participate in the Fibrocell Board meeting as she had no financial interest in Intrexon's participation in the transaction, even though pursuant to a relationship agreement between Intrexon and Aqua Bounty Technologies, Inc. ("AquaBounty"), she was nominated by Intrexon to the board of directors of AquaBounty, which is majority owned by certain of Kirk Affiliates, including Intrexon and Third Security. Representatives of Hogan Lovells reviewed the terms of the proposed Merger Agreement, with a particular focus on the terms relating to the Company's representations and warranties, interim operating covenants, the "no-shop" and "fiduciary out" provisions, closing conditions, termination fees and termination rights, and the negotiations over those terms. The Fibrocell Board discussed the terms of the proposed Merger Agreement and the terms that Castle Creek Pharmaceuticals agreed to with MSD and the Kirk Affiliates, including that the additional consideration in the form of notes to be issued to MSD and the Kirk Affiliates as consideration for entering into the termination agreements would have a six month term, a rate of 8% per annum and an aggregate principal amount equal to the aggregate Conversion Amount payable to holders of the

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Preferred Stock pursuant to the terms of the Merger Agreement and the Certificate of Designations for the Preferred Stock. The Fibrocell Board further discussed with Hogan Lovells the rationale for the payments to MSD and the Kirk Affiliates under the termination agreement, with Hogan Lovells noting that Castle Creek would not enter into the Merger Agreement unless MSD and Kirk Affiliates' interests in Preferred Stock and common stock purchase warrants, and the restrictive covenants accompanying such Preferred Stock and warrants, were extinguished in the transaction. Following this discussion, a representative of Canaccord Genuity reviewed Canaccord Genuity's financial analyses of the proposed consideration of $3.00 per share in cash to be received by holders of Fibrocell's Common Stock in the merger, and rendered an oral opinion, confirmed by delivery of a written opinion dated September 12, 2019, to the Fibrocell Board to the effect that, as of such date and based upon and subject to certain assumptions, factors and qualifications set forth in the written opinion, the consideration of $3.00 per share in cash, without interest, to be received by the holders of Fibrocell's Common Stock (other than certain excluded holders referenced in the written opinion) in the Merger was fair, from a financial point of view, to such holders. Following consideration of the matters discussed during the course of the Fibrocell Board meeting, the Fibrocell directors present at the meeting unanimously (i) determined, based on the recommendation of the Special Committee and upon such other matters as were deemed relevant by the Fibrocell Board, that it was fair to, advisable and in the best interests of the Company and its stockholders for the Company to enter into the Merger Agreement and effect the Merger and the other transactions contemplated thereby, (ii) authorized, approved and adopted the execution, delivery and performance of the Merger Agreement and the transactions contemplated thereby (including the Merger) on behalf of the Company in all respects, (iii) approved, upon the recommendation of the Special Committee and the Audit Committee of the Fibrocell Board, entry into termination agreements with each of MSD and each of the Kirk Affiliates; (iv) authorized and approved the Merger Proposal, the Compensation Proposal and the Adjournment Proposal to be submitted for approval by stockholders of the Company at a special meeting of the stockholders and (v) recommended to the Company's stockholders that they approve the three proposals.

        On September 12, 2019, after the close of trading on the Nasdaq Capital Market, the Company, Castle Creek Pharmaceuticals and Merger Sub executed the Merger Agreement and the other transaction documents and MSD and the Kirk Affiliates executed the termination agreements and the voting and support agreements, and the Company issued a press release announcing the transaction and the execution of the Merger Agreement, the termination agreements and the voting and support agreements.

Recommendation of the Fibrocell Board

        On September 12, 2019, certain members of the Fibrocell Board met to consider the Merger Agreement and after due consideration, and upon the unanimous recommendation of the Special Committee, the members of the Fibrocell Board present unanimously approved the Merger Agreement, determined that it is fair to, advisable and in the best interests of Fibrocell and its stockholders for Fibrocell to enter into the Merger Agreement and effect the Merger and the other transactions contemplated thereby and directed that the approval of the Merger Agreement be submitted to a vote at a meeting of the stockholders. Messrs. Kirk and Smith voluntarily recused themselves from, and did not attend, the September 12, 2019 meeting of the Fibrocell Board in light of their respective interests described in the section entitled "The Merger—Interests of Directors and Executive Officers in the Merger" beginning on page 61. The Fibrocell Board accordingly recommends that stockholders vote "FOR" the Merger Proposal.

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Reasons for the Merger

        As described above in the section entitled "—Background of the Merger," in evaluating the Merger and the Merger Agreement, the Special Committee and Fibrocell Board consulted and discussed with senior management topics and issues related to the Merger, the Merger Agreement and the other transactions contemplated thereby, and consulted with and received the advice of Fibrocell's legal and financial advisors.

        After consideration, the members of the Fibrocell Board present at a special meeting held on September 12, 2019 unanimously:

        In determining to adopt the Merger Agreement and approve the Merger and recommend that Fibrocell's stockholders vote their shares of Common Stock in favor of the proposal to adopt the Merger Agreement, the Special Committee and the Fibrocell Board also considered the material factors that are discussed below. The discussion in this section is not intended to be an exhaustive list of the information and factors considered by the Special Committee and the Fibrocell Board, but rather includes all material factors considered by the Special Committee and the Fibrocell Board. In view of the wide variety of factors considered by the Special Committee and the Fibrocell Board in connection with its evaluation of the Merger and the complexity of these matters, the Special Committee and the Fibrocell Board did not consider it practical, and did not attempt, to quantify, rank or otherwise assign relative weights to the specific factors it considered in reaching its decision and did not undertake to make any specific determination as to whether any particular factor, or any aspect of any particular factor, was favorable or unfavorable to the ultimate determination of the Special Committee or Fibrocell Board. In addition, individual members of the Special Committee or the Fibrocell Board may have given different weight to different factors. The Special Committee and the Fibrocell Board each made its recommendation based on the totality of the information available to the Special Committee and the Fibrocell Board, respectively, including discussions with, and questioning of, management and the financial and legal advisors.

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        The Special Committee and the Fibrocell Board considered the following factors as supporting their respective decisions to recommend that Fibrocell's stockholders vote in favor of the adoption of the Merger Agreement:

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        In the course of its deliberations, the Special Committee and the Fibrocell Board also considered a variety of risks and other countervailing factors related to the Merger Agreement and the Merger, including the following material factors:

        In addition to considering the factors described above, the Special Committee and Fibrocell Board also considered the fact that Fibrocell's directors and executive officers have financial interests in the Merger that may be different from, or in addition to, those of stockholders generally, including those

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interests that are a result of employment and compensation arrangements with Fibrocell, as described in the section above entitled "—Interests of Directors and Executive Officers in the Merger."

        This explanation of the Special Committee's and Fibrocell Board's reasons for recommending the approval of the Merger Agreement and other information presented in this section is forward-looking in nature and, therefore, should be read in light of the factors described in the section entitled "Cautionary Statement Concerning Forward-Looking Statements" beginning on page 19.

Opinion of Fibrocell's Financial Advisor

        Canaccord Genuity is acting as financial advisor to Fibrocell in connection with the Merger. At a meeting of the Fibrocell Board held on September 12, 2019 to evaluate the Merger, Canaccord Genuity delivered to the Fibrocell Board an oral opinion, which opinion was confirmed by delivery of a written opinion, dated September 12, 2019, to the effect that, as of that date and based upon and subject to certain assumptions, factors and qualifications set forth in the written opinion, the consideration of $3.00 per share in cash, without interest, to be received by holders of Common Stock (other than Excluded Holders (as defined below)) in the Merger was fair, from a financial point of view, to such holders. For purposes of Canaccord Genuity's opinion, "Excluded Holders" means the following holders of shares of Common Stock: (1) Fibrocell (or Fibrocell's treasury); (2) any direct or indirect wholly-owned subsidiary of Fibrocell; (3) Castle Creek, Merger Sub and any other direct or indirect wholly-owned subsidiaries of Castle Creek; and (4) holders who are entitled to and properly demand an appraisal of their shares of Common Stock under the DGCL (the "Dissenting Shares"). Canaccord Genuity did not express any view on, and its opinion did not address, any other term or aspect of any other agreements or arrangements contemplated by the Merger Agreement or entered into in connection with the Merger (including, without limitation, any agreements or arrangements with any holder of Preferred Stock, Convertible Notes, warrants or options).

        The full text of Canaccord Genuity's written opinion is attached to this proxy statement as Annex B and is incorporated into this proxy statement by reference. The description of Canaccord Genuity's opinion set forth in this proxy statement is qualified in its entirety by reference to the full text of such opinion. Fibrocell stockholders are encouraged to read Canaccord Genuity's opinion carefully and in its entirety for a description of the procedures followed, assumptions made, matters considered and qualifications and limitations on the review undertaken by Canaccord Genuity in connection with its opinion. Canaccord Genuity's opinion addressed to the Fibrocell Board was only one of many factors considered by the Fibrocell Board in its evaluation of the Merger and only addresses the fairness, from a financial point of view and as of the date of the opinion, of the consideration of $3.00 per share in cash, without interest, to be received in the Merger by holders of Common Stock (other than Excluded Holders). Canaccord Genuity's opinion does not address the relative merits of the Merger as compared to other business strategies or transactions that might be available to Fibrocell, nor does it address the underlying business decision of Fibrocell to proceed with the Merger. Canaccord Genuity's opinion was directed to and for the information of the Fibrocell Board only (in its capacity as such) in connection with its evaluation of the Merger and does not constitute advice or a recommendation to the Fibrocell Board or any other person as to how the Fibrocell Board or such person should vote with respect to the Merger or otherwise act on any other matter with respect to the Merger. Canaccord Genuity's opinion was necessarily based on securities, economic, market and monetary conditions prevailing on, and the information made available to Canaccord Genuity as of, September 12, 2019, the date of its opinion. Subsequent developments may affect the conclusions expressed in Canaccord Genuity's opinion if such opinion were rendered as of a later date. Canaccord Genuity assumes no responsibility for updating, revising or reaffirming its opinion based on circumstances or events occurring after the date of the opinion.

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        In connection with its review of the Merger and developing its opinion, Canaccord Genuity, among other things:

        In connection with its review and arriving at its opinion, Canaccord Genuity did not independently verify any of the foregoing information, relied on such information, assumed that all such information was complete and accurate in all material respects, and relied on assurances of management of Fibrocell that they were not aware of any facts that would make such information misleading. With respect to any internal financial information, forecasts, projections and analyses of Fibrocell and any other forward-looking information reviewed by Canaccord Genuity, Canaccord Genuity assumed, with the permission of the Fibrocell Board, that such information had been reasonably prepared on bases reflecting the best currently available estimates and judgments of management of Fibrocell. Canaccord Genuity expressed no view as to the reasonableness of any projections or other forward-looking information and the assumptions on which they were based, and Canaccord Genuity relied, with the permission of the Fibrocell Board, on such projections and other forward-looking information for purposes of its analysis and opinion. Canaccord Genuity expressed no view or opinion as to such information or the assumptions on which it was based.

        Canaccord Genuity also assumed that (1) the Merger will be consummated upon the terms set forth in the Merger Agreement, without any waiver, modification or amendment of any material term, condition or agreement therein which would be in any way meaningful to Canaccord Genuity's analysis and (2) in the course of obtaining necessary governmental, regulatory and third-party approvals and consents for the Merger, no modification, delay, limitation, restriction or conditions will be imposed which would have an adverse effect on Fibrocell or Castle Creek or be in any way meaningful to Canaccord Genuity's analysis. Canaccord Genuity is not a legal, accounting, regulatory or tax expert and relied on the assessments made by Fibrocell and its advisors with respect to such matters.

        Canaccord Genuity's opinion is limited to and addresses only the fairness, from a financial point of view, as of the date of such opinion, to the holders of shares of Common Stock (other than Excluded

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Holders) of the consideration of $3.00 per share in cash, without interest, to be received by such holders in the Merger (without giving effect to any impact of the Merger on any particular holders of shares of Common Stock other than in such capacity as a holder of shares of Common Stock). Canaccord Genuity did not express any view on, and its opinion did not address, any other term or aspect of any other agreement or arrangements contemplated by the Merger Agreement or entered into in connection with the Merger (including, without limitation, any agreements or arrangements with any holder of Preferred Stock, Convertible Notes, warrants or options). Canaccord Genuity expressed no opinion as to the fairness of the Merger to the holders of any other class of securities (including, without limitation, Preferred Stock, Convertible Notes, warrants or options), creditors or other constituencies of Fibrocell or any value that the holders of Dissenting Shares may be entitled to receive. Canaccord Genuity's opinion does not address the relative merits of the Merger as compared to other business strategies or transactions that might be available to Fibrocell, nor does it address the underlying business decision of Fibrocell to proceed with the Merger or any view on another term or aspect of the Merger, including, without limitation, the structure or form of the Merger, or any other agreements or arrangements contemplated by the Merger Agreement or entered into in connection with the Merger Agreement (including, without limitation, any agreements or arrangements with any holder of Preferred Stock, Convertible Notes, warrants or options). Canaccord Genuity did not consider, and did not express an opinion as to, the fairness of the amount or nature of the compensation to any of the officers, directors or employees of Fibrocell or any other party, or class of such persons, in connection with the Merger, whether relative to the consideration to be paid to the holders of shares of Common Stock pursuant to the Merger Agreement or otherwise. Further, Canaccord Genuity did not express any opinion as to the price or range of prices at which shares of Common Stock or any other securities may trade or otherwise be transferable at any time, including following announcement or consummation of the Merger.

        Canaccord Genuity was not requested to conduct, and did not conduct, nor did Canaccord Genuity rely upon, any independent valuation or appraisal of any of the assets or liabilities (contingent, derivative, off-balance sheet or otherwise) of Fibrocell. Canaccord Genuity also did not evaluate nor express any opinion as to the solvency of any party to the Merger Agreement, or the ability of Fibrocell or Castle Creek to pay its obligations when they become due, or the impact of the Merger on such matters, under any laws, rules or regulations relating to bankruptcy, insolvency or similar matters.

Summary of Financial Analyses

        The following is a summary of the material financial analyses performed by Canaccord Genuity in connection with rendering its opinion dated September 12, 2019 described above. The following summary, however, does not purport to be a complete description of the factors considered or financial analyses performed by Canaccord Genuity, nor does the order of analyses described represent relative importance or weight given to those analyses by Canaccord Genuity. Some of these summaries of the financial analyses include information presented in tabular format. The tables must be read together with the full text of each summary and are alone not a complete description of Canaccord Genuity's financial analyses. In performing its analyses, Canaccord Genuity made numerous assumptions with respect to industry performance, general business and economic conditions and other matters, many of which are beyond the control of Fibrocell or any other parties to the Merger Agreement. Any estimates contained in these analyses are not necessarily indicative of actual values or predictive of future results or values, which may be significantly more or less favorable than as set forth below. Except as otherwise noted, the following quantitative information, to the extent that it is based on market data, is based on market data as it existed on or before September 10, 2019 and is not necessarily indicative of current market conditions.

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        Selected Public Companies Analysis.    Canaccord Genuity reviewed certain publicly available financial information for selected development-stage companies that, based on its experience and professional judgment, share similar business characteristics to Fibrocell. No company utilized in the selected public companies analysis is directly comparable to Fibrocell and certain of these companies may have financial, business and/or operating characteristics that are materially different from those of Fibrocell. However, the companies were selected, among other reasons, because they are publicly-traded companies with businesses that, for purposes of Canaccord Genuity's analysis, may be considered similar to that of Fibrocell based on industry sector and the stage of development of key products.

        The selected public companies are listed below:

        Canaccord Genuity calculated the implied enterprise value of each of the selected public companies based on information obtained from filings with the SEC, the Capital IQ database, and other public sources. For this analysis, Canaccord Genuity calculated enterprise value by taking fully-diluted equity value (determined using the treasury stock method), adding debt, preferred stock and minority interest, and subtracting cash and cash equivalents. Based on its analysis and other considerations that Canaccord Genuity deemed relevant in its experience and professional judgment, Canaccord Genuity derived a range of implied enterprise values for Fibrocell of $31.0 million to $37.9 million based on the plus and minus 10% range of the median enterprise value of the selected public companies, which implied median enterprise value was $34.5 million. Applying this range of implied enterprise values and adding to such range Fibrocell's cash and cash equivalents of $7.1 million and subtracting from it Fibrocell's total debt of $29.1 million (in each case as provided by Fibrocell management), Canaccord Genuity derived a range of implied equity values for Fibrocell of $9.0 million to $15.9 million. Canaccord Genuity then derived a range of implied per share equity values for Fibrocell of $0.93 to $1.63 using the fully-diluted shares of Common Stock as provided by Fibrocell management (determined using the treasury stock method and assuming in Canaccord Genuity's professional judgment that the Black-Scholes Warrants (as defined below) were not redeemed by Fibrocell). Canaccord Genuity compared this range to the Merger Consideration of $3.00 per share of Common Stock.

        Selected Precedent Transactions Analysis.    Canaccord Genuity reviewed certain publicly available financial information related to selected transactions involving non-oncology, development stage companies that Canaccord Genuity, based on its experience and professional judgment, deemed relevant to consider in relation to Fibrocell and the Merger. Although none of the selected transactions is directly comparable to the Merger, the target companies in the selected transactions have businesses that, for purposes of Canaccord Genuity's analysis, may be considered similar to that of Fibrocell based on industry sector and the stage of development of key products.

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        The selected precedent transactions are listed below:

Announcement Date
  Target   Acquiror
11/8/18   Asterias Biotherapeutics, Inc.   BioTime, Inc.
6/16/17   Cell Cure Neurosciences Ltd.   BioTime, Inc.
1/24/17   GenVec, Inc.   Intrexon Corporation
8/10/16   Stratatech Corporation   Mallinckrodt plc
11/10/15   Ocata Therapeutics, Inc.   Astellas Pharma Inc.
12/20/13   Medistem Inc.   Intrexon Corporation
2/8/12   Aldagen Inc.   Cytomedix Inc.
7/14/11   Amorcyte, Inc.   Neostem, Inc.

        Canaccord Genuity calculated the implied enterprise value of each of the target companies in the selected precedent transactions based on information obtained from filings with the SEC, the BioCentury and Capital IQ databases, and other public sources. For this analysis, Canaccord Genuity calculated enterprise value based on the upfront consideration payable at closing with respect to such transactions. Based on its analysis and other considerations that Canaccord Genuity deemed relevant in its experience and professional judgment, Canaccord Genuity derived a range of implied enterprise values for Fibrocell of $29.3 million to $35.8 million based on the plus and minus 10% range of the median enterprise value of the selected precedent transactions, which implied median enterprise value was $32.6 million. Applying this range of implied enterprise values and adding to such range Fibrocell's cash and cash equivalents of $7.1 million and subtracting from it Fibrocell's total debt of $29.1 million (in each case as provided by Fibrocell management), Canaccord Genuity derived a range of implied equity values for Fibrocell of $7.3 million to $13.8 million. Canaccord Genuity then derived a range of implied per share equity values for Fibrocell of $0.75 to $1.42 using the fully-diluted shares of Common Stock as provided by Fibrocell management (determined using the treasury stock method and assuming in Canaccord Genuity's professional judgment that the Black-Scholes Warrants were not redeemed by Fibrocell). Canaccord Genuity compared this range to the Merger Consideration of $3.00 per share of Common Stock.

        Discounted Cash Flow Analysis.    Canaccord Genuity conducted a discounted cash flow analysis for each of FCX-007 and FCX-013 for the purpose of calculating a range of equity values per share of Common Stock on a stand-alone basis. A discounted cash flow analysis is a method of evaluating an asset using estimates of the future unlevered free cash flows generated by the asset and taking into consideration the time value of money with respect to those future cash flows by calculating their net present value. For purposes of this analysis, Canaccord Genuity utilized financial projections provided by Fibrocell management to determine the unlevered free cash flows for FCX-007 and FCX-013 for calendar years 2019 through 2028. These financial projections were adjusted based on probability of occurrence assumptions provided by Fibrocell management. See the section of this proxy statement entitled "—Certain Unaudited Prospective Financial Information." For each of FCX-007 and FCX-013, unlevered free cash flows were calculated by taking net income, adding back depreciation, subtracting capital expenditures, and adjusting for changes in working capital.

        Canaccord Genuity calculated the net present value of the unlevered free cash flows for FCX-007 and FCX-013 for calendar years 2019 through 2028 and calculated terminal values in the year 2028 based on a terminal perpetual growth rate ranging from 0% to 2.0%. Canaccord Genuity selected these terminal perpetual growth rates based on input from Fibrocell management and the application of its professional judgment. These values were discounted to net present values as of September 10, 2019 at a discount rate ranging from 25.6% to 27.6%, which range of discount rates was selected, upon the application of Canaccord Genuity's professional judgment, based on an analysis of the weighted average cost of capital of the publicly-traded companies referenced above in the section entitled "—Selected Public Companies Analysis".

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        Based on this analysis, Canaccord Genuity derived a range of implied enterprise values for Fibrocell of $46.4 million to $55.4 million based on the combined net present values of FCX-007 and FCX-013. Applying this range of implied enterprise values and adding to such range Fibrocell's cash and cash equivalents of $7.1 million and subtracting from it Fibrocell's total debt of $29.1 million and the repurchase price for the Black-Scholes Warrants of $10.6 million (in each case as provided by Fibrocell management), Canaccord Genuity derived a range of implied equity values for Fibrocell of $13.7 million to $22.8 million. Canaccord Genuity then derived a range of implied per share equity values for Fibrocell of $1.41 to $2.32 using the fully-diluted shares of Common Stock as provided by Fibrocell management (determined using the treasury stock method and assuming in Canaccord Genuity's professional judgment that the Black-Scholes Warrants were redeemed by Fibrocell). Canaccord Genuity compared this range to the Merger Consideration of $3.00 per share of Common Stock.

Other Information

        Canaccord Genuity observed certain additional factors that were not considered part of its financial analyses for purposes of its opinion but were noted to the Fibrocell Board of Directors for reference purposes only, including the following:

 
  Premiums to Target
Stock Price
 
 
  1-Day   1-Week   1-Month  

Mean

    53.1 %   54.2 %   65.2 %

Median

    36.8 %   35.0 %   49.7 %

General

        The preparation of a fairness opinion is a complex process and is not necessarily susceptible to partial analysis or summary description. Selecting portions of the analyses or of the summary set forth above, without considering the analyses as a whole, could create an incomplete view of the processes underlying Canaccord Genuity's opinion. In arriving at its fairness determination, Canaccord Genuity considered the results of all of its analyses and did not attribute any particular weight to any factor or analysis considered by it. Rather, Canaccord Genuity made its determination as to fairness on the basis of its experience and professional judgment after considering the results of all of its analyses, taken as a whole. No company or transaction used in the above analyses as a comparison is directly comparable to Fibrocell or the Merger. The reasons for and the circumstances surrounding each of the selected

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companies and transactions analyzed were diverse and there are inherent differences in the business, operations, financial condition and prospects of Fibrocell and the companies included in those analyses.

        Canaccord Genuity prepared these analyses for purposes of providing its opinion to the Fibrocell Board as to the fairness, from a financial point of view and as of the date of the opinion, of the $3.00 per share in cash, without interest, to be received in the Merger by holders of Fibrocell's Common Stock (other than Excluded Holders). These analyses do not purport to be appraisals, nor do they necessarily reflect the prices at which businesses or securities actually may be sold.

        The Merger Consideration was determined through negotiations between Fibrocell and Castle Creek and was approved by the Fibrocell Board. Canaccord Genuity provided advice to the Fibrocell Board during these negotiations. Canaccord Genuity, however, did not recommend any specific amount of consideration to Fibrocell or the Fibrocell Board or that any specific amount of consideration constituted the only appropriate consideration for the Merger.

        As described above, Canaccord Genuity's opinion to the Fibrocell Board was one of many factors taken into consideration by the Fibrocell Board in making its determination to approve the Merger Agreement. The foregoing summary does not purport to be a complete description of the factors considered or financial analyses performed by Canaccord Genuity in connection with its opinion and is qualified in its entirety by reference to the full text of the written opinion of Canaccord Genuity attached to this proxy statement as Annex B. The issuance of Canaccord Genuity's opinion was approved by a fairness committee of Canaccord Genuity.

        Canaccord Genuity, as part of its investment banking activities, is regularly engaged in the valuation of businesses and their securities in connection with mergers and acquisitions, negotiated underwritings, secondary distributions of listed and unlisted securities, private placements and valuations for corporate and other purposes. In the ordinary course of business, Canaccord Genuity and its affiliates may acquire, hold or sell, for its and its affiliates' own accounts and the accounts of customers, equity, debt and other securities and financial instruments (including bank loans and other obligations) of Fibrocell or Castle Creek.

        In the two years preceding the date of its opinion, Canaccord Genuity had not provided investment banking or other financial services of a material nature to either Fibrocell or Castle Creek, except as related to the Merger and otherwise described below. During such two-year period, Canaccord Genuity provided financial advisory services to Fibrocell with respect to potential strategic transactions involving certain assets of Fibrocell, including in connection with the Co-Development Agreement, for which services Canaccord Genuity received an aggregate amount of approximately $450,000. Canaccord Genuity may provide investment banking services to Fibrocell, Castle Creek or their respective affiliates in the future for which Canaccord Genuity may receive compensation.

        The Fibrocell Board selected Canaccord Genuity as its financial advisor because it is a nationally recognized investment banking firm that has substantial experience in transactions similar to the Merger. Pursuant to a letter agreement dated as of July 15, 2017, Fibrocell engaged Canaccord Genuity to act as its financial advisor in connection with various financial and strategic matters, including the Merger, and the delivery of a fairness opinion as described above. Pursuant to the terms of the engagement letter, Fibrocell agreed to pay Canaccord Genuity a fee of $1,050,000 for its services in connection with the Merger, of which $150,000 was payable upon signing of the engagement letter, $350,000 was payable upon delivery by Canaccord Genuity of its opinion, and the remainder of which is contingent upon consummation of the Merger. In addition, Fibrocell has agreed to reimburse Canaccord Genuity for certain expenses and to indemnify Canaccord Genuity and related persons for liabilities relating to or arising out of its engagement.

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Certain Unaudited Prospective Financial Information

        Fibrocell does not as a matter of course make public projections as to future performance, earnings or other results, due to, among other reasons, the uncertainty of the underlying assumptions and estimates. However, in connection with the Merger, Fibrocell's management prepared certain unaudited prospective financial information regarding the financial performance of Fibrocell's product candidates FCX-007 and FCX-013 for calendar years 2019 through 2023 (the "Fibrocell Projections"). The Fibrocell Projections were provided to the Fibrocell Board and Fibrocell's financial advisor, Canaccord Genuity, including in connection with Canaccord Genuity's financial analyses described above under the section entitled "—Opinion of Fibrocell's Financial Advisor." The below summary of the Fibrocell Projections is included for the purpose of providing stockholders access to certain nonpublic information that was furnished to certain parties in connection with the Merger, and such information may not be appropriate for other purposes, and is not included to influence the voting decision of any stockholder.

        The Fibrocell Projections were not prepared with a view toward public disclosure, the published guidelines of the SEC regarding projections, the use of financial measures not prepared in accordance with U.S. Generally Accepted Accounting Principles ("GAAP") or forward-looking statements, or the guidelines established by the American Institute of Certified Public Accountants for preparation and presentation of financial projections. None of Fibrocell, Castle Creek, Canaccord Genuity or their respective officers, directors, affiliates, advisors or other representatives considered, or now consider, the inclusion of the Fibrocell Projections to be regarded as an indication that the Fibrocell Projections are predictive of actual future events or results and such information should not be relied upon as such, and readers of this proxy statement are cautioned not to place undue reliance on the Fibrocell Projections. The Fibrocell Projections included in this proxy statement have been prepared by, and are the responsibility of, Fibrocell's management.

        While presented with numeric specificity, this unaudited prospective financial information was based on numerous variables and assumptions (including assumptions related to industry performance and general business, economic, market and financial conditions and additional matters specific to Fibrocell's business) that are inherently subjective and uncertain and are beyond the control of Fibrocell's management. Important factors that may affect actual results and cause this unaudited prospective financial information not to be achieved include, but are not limited to, risks and uncertainties relating to Fibrocell's business (including its ability to achieve strategic goals, objectives and targets over applicable periods), regulatory approval or other legal developments affecting the products, industry performance, general business and economic conditions and other factors described in the section entitled "Cautionary Statement Concerning Forward-Looking Statements" beginning on page 19. This unaudited prospective financial information also reflects numerous variables, expectations and assumptions available at the time it was prepared as to certain business decisions that are subject to change. As a result, actual results may differ materially from those contained in this unaudited prospective financial information. Accordingly, there can be no assurance that the projected results summarized below will be realized. Stockholders are urged to review the most recent SEC filings of Fibrocell for a description of the reported and anticipated results of operations and financial condition and capital resources, including in "Management's Discussion and Analysis of Financial Condition and Results of Operations" in Fibrocell's Annual Report on Form 10-K for the year ended December 31, 2018, and the Quarterly Reports on Form 10-Q for the quarters ended March 31, 2019 and June 30, 2019. None of Fibrocell, Castle Creek, Canaccord Genuity or their respective officers, directors, affiliates, advisors or other representatives can give you any assurance that actual results will not differ materially from this unaudited prospective financial information.

        FIBROCELL UNDERTAKES NO OBLIGATION TO UPDATE OR OTHERWISE REVISE OR RECONCILE THE BELOW UNAUDITED PROSPECTIVE FINANCIAL INFORMATION TO REFLECT CIRCUMSTANCES EXISTING AFTER THE DATE THIS UNAUDITED PROSPECTIVE

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FINANCIAL INFORMATION WAS GENERATED OR TO REFLECT THE OCCURRENCE OF FUTURE EVENTS, EVEN IN THE EVENT THAT ANY OR ALL OF THE ASSUMPTIONS UNDERLYING SUCH INFORMATION ARE SHOWN TO BE IN ERROR. SINCE THE UNAUDITED PROSPECTIVE FINANCIAL INFORMATION COVERS MULTIPLE YEARS, SUCH INFORMATION BY ITS NATURE BECOMES LESS PREDICTIVE WITH EACH SUCCESSIVE YEAR.

        Fibrocell has not made and makes no representation to Castle Creek or any Fibrocell stockholder, in the Merger Agreement or otherwise, concerning the below unaudited prospective financial information or regarding Fibrocell's actual performance compared to the unaudited prospective financial information or that the projected results will be achieved. In light of the foregoing factors and the uncertainties inherent in the unaudited prospective financial information, Fibrocell urges all of our stockholders not to place undue reliance on such information and to review Fibrocell's most recent SEC filings for a description of Fibrocell's reported financial results.

        The Fibrocell Projections were based on numerous variables and assumptions, including approval of FCX-007 in 2021 and commercial launch in 2022, and approval of FCX-013 in 2022 and commercial launch in 2023.

        The following table presents a summary of the Fibrocell Projections regarding FCX-007 for the calendar years ending 2019 through 2023.

 
  Year Ending December 31,  
 
  2019E   2020E   2021E   2022E   2023E  
 
  ($ in millions)
 

Revenue

              $ 86.4   $ 140.7  

Cost of Goods Sold

                (10.9 )   (8.9 )

Gross Profit

              $ 75.5   $ 131.8  

Fibrocell Share of Gross Profit(1)

              $ 22.7   $ 39.5  

Milestone Payments

  $ 10.0       $ 30.0          

Proceeds of Sale of Priority Review Voucher(2)

                80.6      

Intrexon Share of Profit(3)

    (5.0 )       (15.0 )   (11.3 )   (19.8 )

Operating Expenses

    (3.9 )   (4.0 )   (4.2 )   (4.3 )   (4.5 )

EBITDA(4)

  $ 1.1   $ (4.0 ) $ 10.8   $ 87.6   $ 15.3  

Depreciation

    (0.5 )   (0.5 )   (3.1 )   (3.1 )   (3.1 )

EBIT(4)

  $ 0.6   $ (4.5 ) $ 7.8   $ 84.6   $ 12.2  

Tax expense(5)

    (0.1 )       (2.2 )   (24.3 )   (3.5 )

Net Income

  $ 0.5   $ (4.5 ) $ 5.6   $ 60.2   $ 8.8  

(1)
Pursuant to the terms of the Co-Development Agreement, Fibrocell is entitled to 30% of the gross profit on sales of FCX-007. The projection does not include development expenses for FCX-007 due to the Co-Development Agreement.

(2)
Assumes that the Priority Review Voucher ("PRV") will be granted to Fibrocell in 2021 and will be sold in 2022. Sale price of voucher based on the median price of the three most recent PRV sales as of September 10, 2019.

(3)
Pursuant to the terms of Fibrocell's 2012 Exclusive Channel Collaboration Agreement with Intrexon, Fibrocell is required to pay Intrexon 50% of all upfront, milestone and profit share payments from Castle Creek Pharmaceuticals.

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(4)
EBITDA is defined as earnings before interest, taxes, depreciation and amortization. EBIT is defined as earnings before interest and taxes. EBITDA and EBIT are non-GAAP financial performance measures and should not be used as alternatives to net income as an indicator of operating performance.

(5)
Based on Fibrocell's marginal corporate tax rate of 28.9% derived from the federal corporate tax rate of 21.0% and Pennsylvania state effective corporate tax rate of 7.89% after allowing for federal deductibility. Net operating loss limitations in accordance with the Tax Cuts and Jobs Act and Section 382 were considered in estimating tax expenses. Utilizes 50.0% of the Section 382 limitation of $560,940 on net operating loss carryforwards per fiscal year, calculated using fair market value of $29.7 million for the Common Stock and the federal long-term tax-exempt rate of 1.89% for September 2019 from the Internal Revenue Service.

        The following table presents a summary of the Fibrocell Projections regarding FCX-013 for the calendar years ending 2019 through 2023.

 
  Year Ending December 31,  
 
  2019E   2020E   2021E   2022E   2023E  
 
  ($ in millions)
 

Revenue

                  $ 100.9  

Intrexon Net Sales Royalties(1)

                    (7.1 )

Cost of Goods Sold

                    (35.2 )

Gross Profit

                    58.6  

Development Expenses

  $ (6.8 ) $ (6.9 ) $ (20.6 ) $ (7.4 )   (0.5 )

Selling Expenses

                (7.4 )   (8.9 )

Proceeds of Sale of Priority Review Voucher(2)

                    80.6  

Operating Expenses

    (4.0 )   (4.1 )   (4.1 )   (4.2 )   (4.3 )

EBITDA(3)

  $ (10.8 ) $ (10.9 ) $ (24.7 ) $ (19.0 ) $ 125.4  

Depreciation

    (0.5 )   (0.5 )   (3.1 )   (3.1 )   (3.1 )

EBIT(3)

  $ (11.3 ) $ (11.4 ) $ (27.8 ) $ (22.0 ) $ 122.4  

Tax Expense(4)

                    (35.3 )

Net Income

  $ (11.3 ) $ (11.4 ) $ (27.8 ) $ (22.0 ) $ 87.1  

(1)
Pursuant to the terms of Fibrocell's 2012 Exclusive Channel Collaboration Agreement with Intrexon, Fibrocell is required to pay Intrexon 7% of quarterly net sales up to $25 million plus 14% on quarterly net sales greater than $25 million.

(2)
Assumes that the PRV will be granted to Fibrocell in 2023 and will be sold in 2023. Sale price of voucher based on the median price of the three most recent PRV sales as of September 10, 2019.

(3)
EBITDA is defined as earnings before interest, taxes, depreciation and amortization. EBIT is defined as earnings before interest and taxes. EBITDA and EBIT are non-GAAP financial performance measures and should not be used as alternatives to net income as an indicator of operating performance.

(4)
Based on Fibrocell's marginal corporate tax rate of 28.9% derived from the federal corporate tax rate of 21.0% and Pennsylvania state effective corporate tax rate of 7.89% after allowing for federal deductibility. Net operating loss limitations in accordance with the Tax Cuts and Jobs Act and Section 382 were considered in estimating tax expenses. Utilizes 50.0% of the Section 382 limitation of $560,940 on net operating loss carryforwards per fiscal year, calculated using fair

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    market value of $29.7 million for the Common Stock and the federal long-term tax-exempt rate of 1.89% for September 2019 from the Internal Revenue Service.

Interests of Directors and Executive Officers in the Merger

        In considering the recommendation of the Fibrocell Board that stockholders vote to approve the Merger Proposal, stockholders should be aware that our directors and executive officers have interests in the Merger that may be different from, or in addition to, the interests of stockholders generally and that may present actual or potential conflicts of interest. The Special Committee, composed of disinterested directors of the Fibrocell Board, Messrs. Swirsky, Moore and Mazur, each of whom were independent from and not affiliated with Intrexon or the other Kirk Affiliates and MSD, was aware of and considered these potential interests when it evaluated and negotiated the Merger Agreement, and recommended that the Fibrocell Board approve the Merger Agreement and recommend adoption of the Merger Agreement by Fibrocell's stockholders. In addition, the Fibrocell Board was aware of and considered these potential interests, among other matters, in approving the Merger Agreement and in recommending to stockholders the approval of the Merger Proposal, the Compensation Proposal and the Adjournment Proposal.

        Treatment of Stock Options.    Each stock option to purchase shares of Common Stock issued under Fibrocell's equity incentive plans outstanding immediately prior to the Effective Time, whether vested or unvested, will be converted into the right to receive with respect to each share of Common Stock underlying the stock option (whether vested or unvested) an amount in cash equal to the Merger Consideration minus the exercise price of such stock option, less applicable taxes required to be withheld. If the per share exercise price of a stock option is equal to or greater than the Merger Consideration, the stock option shall terminate and be canceled for no consideration.

        The following table sets forth, based on options outstanding as of the date of this proxy statement, the cash proceeds that each of our non-employee directors and executive officers would receive at the Effective Time of the Merger in respect of the settlement of their options.

 
  Name   Number of
Options(1)
(#)
  Total Option
Consideration(2)
($)
 

Non-Employee Directors:

 

Kelvin D. Moore

    18,000     16,560  

 

Marc B. Mazur

    18,000     16,560  

 

Marcus E. Smith

    18,000     16,560  

 

Julian P. Kirk

    18,000     16,560  

 

Christine St.Clare

    18,000     16,560  

 

Douglas J. Swirsky

    18,000     16,560  

Executive Officers:

 

John M. Maslowski

    100,000     122,000  

 

Sean D. Buckley

    45,000     54,300  

(1)
The amounts in this column constitute the in-the-money options held by our non-employee directors and executive officers as of the date of this proxy statement, based on the value of the Merger Consideration (i.e., $3.00 per share). The remaining options held by our non-employee directors and executive officers as of the date of this proxy statement, which are out-of-the money based on the value of the Merger Consideration, will be cancelled for no consideration in the Merger.

(2)
Amounts do not reflect withholding of applicable taxes.

        Employment Agreements.    Each of Fibrocell's executive officers, John M. Maslowski (President and Chief Executive Officer) and Sean D. Buckley (Chief Financial Officer and Corporate Secretary), is a party to an employment agreement with Fibrocell pursuant to which the executive is entitled to receive

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severance payments and benefits if his employment is terminated by Fibrocell without "cause" or by the executive for "good reason" (as each such term is defined in the employment agreement), subject to the executive's execution and non-revocation of a release of claims in favor of Fibrocell. If any such termination of employment occurs within 90 days prior to, on or within 18 months following a "change of control" (as defined in Fibrocell's 2019 Equity Incentive Plan or any successor plan), then the severance payments and benefits will be comprised of the following: (i) an amount equal to one and a half times (for Mr. Maslowski) or one times (for Mr. Buckley) the sum of (x) the executive's then annual base salary and (y) his then target annual bonus, payable in a single lump sum cash payment, (ii) reimbursement by Fibrocell of 100% of the monthly COBRA premium paid by the executive for him and his eligible dependents for 18 months (for Mr. Maslowski) or 12 months (for Mr. Buckley) following his termination date or, if earlier, until the date he becomes eligible to receive coverage from another employer or is otherwise no longer eligible to receive COBRA continuation coverage, and (iii) all outstanding, unvested equity awards held by the executive on his termination date will become fully vested as of such date, and each outstanding stock option held by him on such date will remain exercisable until the earlier of the original expiration date of such stock option and the three month anniversary of his termination date. In addition, Fibrocell must provide each executive with 30 days' advance written notice of a termination of his employment without cause or pay the executive 30 days' pay in lieu of such notice.

        For purposes of the employment agreements, "cause" means (A) the executive's conviction of or plea of nolo contendere to a felony or a misdemeanor involving moral turpitude; (B) the executive's commission of fraud, misappropriation or embezzlement against any person; (C) the theft or misappropriation by the executive of any property or money of Fibrocell or an affiliate of Fibrocell; (D) the executive's material breach of the terms of the employment agreement; or (E) the willful or gross neglect of the executive's duties, the willful or gross misconduct in performance of the executive's duties or the willful violation by the executive of any material Fibrocell policy. However, "cause" will not exist with respect to items (D) or (E) above until and unless the executive fails to cure such breach, neglect or misconduct (if such breach, neglect or misconduct is capable of cure) within ten days after written notice from the Fibrocell Board. For purposes of the employment agreements, "good reason" means the occurrence of any of the following events without the executive's express written consent (i) a material breach of the employment agreement by Fibrocell, (ii) any change of the executive's principal office location to a location that requires a one-way commute of more than 50 miles from 405 Eagleview Boulevard, Exton, PA, or (iii) the assignment to the executive of any duties materially inconsistent with the duties or responsibilities of his position with Fibrocell or any other action by Fibrocell that results in a material diminution in such position, authority, duties, or responsibilities, excluding an isolated, insubstantial, and inadvertent action not taken in bad faith. However, good reason will not exist unless the executive gives Fibrocell written notice within 90 days after the occurrence of the event which the executive believes constitutes the basis for good reason, Fibrocell fails to cure such act or failure to act, if curable, within 30 days after receipt of such notice and the executive actually terminates his employment within 60 days following the expiration of such cure period.

        The employment agreements contain certain restrictive covenants in favor of Fibrocell, including, among other things, a non-competition covenant that applies during the term of the executive's employment and for the one-year period following his termination of employment, non-solicitation covenants with respect to Fibrocell's customers and employees that apply during the term of the executive's employment and for the one-year period following his termination of employment, and a non-disclosure of confidential information covenant.

        The employment agreements do not require that Fibrocell make any "gross up" payments to compensate the executive for excise taxes, if any, imposed under Section 4999 of the Internal Revenue Code of 1986, as amended (the "Code"), for the receipt of "excess parachute payments" (within the

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meaning of Section 280G of the Code) in the event of a termination or resignation following a change in control; however, each agreement provides that if such excise taxes may be imposed as a result of payments made to the executive in the event of a change in control, the amount of such payments to such executive will be reduced to a level that will not exceed the amount that would trigger such excise taxes, if such reduction would put the executive in a better after-tax position.

        See the section below entitled "—Golden Parachute Compensation" beginning on page 63 of this proxy statement for an estimate of the severance payments and benefits that Mr. Maslowski and Mr. Buckley may become entitled to receive upon a termination of employment by Fibrocell without cause or by the executive for good reason, in each case within 90 days prior to, on or within 18 months following a change of control.

        Payment of 2019 Bonuses.    In the event the closing date of the Merger is prior to January 1, 2020, Castle Creek will, or will cause Fibrocell to, pay each employee of Fibrocell who continues in employment following the closing date, including each of Fibrocell's executive officers, his or her annual bonus in respect of the 2019 fiscal year on Fibrocell's first regularly scheduled payroll date following January 1, 2020, subject to all applicable withholdings and such employee's continued employment through the payment date. All such bonuses will be paid at the employee's target bonus opportunity, which is $212,500 for Mr. Maslowski and $82,500 for Mr. Buckley.

        Indemnification and Insurance.    Pursuant to the terms of the Merger Agreement, Fibrocell's directors and executive officers will be entitled to certain ongoing indemnification and insurance coverage as a result of the Surviving Corporation assuming all rights to indemnification, advancement of expenses and exculpation from liabilities for acts or omissions occurring at or prior to the Merger existing in favor of any such Fibrocell director or executive officer. See "The Merger Agreement—Indemnification and Insurance" beginning on page 78 for additional information regarding such indemnification and insurance coverage.

        Golden Parachute Compensation.    The following table sets forth the information required by Item 402(t) of Regulation S-K promulgated by the SEC, regarding certain compensation that each of our named executive officers will or may be paid in connection with the Merger. Our "named executive officers" for this purpose are John M. Maslowski and Sean D. Buckley. The figures in the table are estimated based on compensation and benefit levels as of the date of this proxy statement, and based on the assumption that the Effective Time of the Merger will be [            ], 2019, and that each of the named executive officers will incur a qualifying termination of employment (i.e., a termination by Fibrocell without cause or by the executive for good reason) immediately following the Effective Time of the Merger. For additional details regarding the terms of the payments quantified below, see the sections entitled "—Treatment of Options," "—Employment Agreements" and "—Payment of 2019 Bonuses" above.


Golden Parachute Compensation

Name
  Cash(1)
($)
  Equity(2)
($)
  Perquisites /
Benefits(3)
($)
  Total(4)
($)
 

John M. Maslowski

    991,182     122,000     35,970     1,149,152  

President and Chief Executive Officer

                         

Sean D. Buckley

    380,103     54,300     23,646     458,049  

Chief Financial Officer and Corporate Secretary

                         

(1)
The amounts reported in this column represent the severance amounts payable to each named executive officer under his employment agreement. The severance amounts constitute "double-trigger" arrangements because they are conditioned upon both the closing of the Merger and a

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    qualifying termination of the applicable executive's employment within 90 days prior to, on or within 18 months following a change of control. The amounts reported in this column are comprised of the following components, all of which are payable in cash:

Names
  Salary
Severance
($)
  Bonus
Severance
($)
  Pay in Lieu of
Notice
($)
  Total
Severance
($)
 

John M. Maslowski

    637,500     318,750     34,932     991,182  

Sean D. Buckley

    275,000     82,500     22,603     380,103  
(2)
The amounts reported in this column represent the value of the payments in cancellation of the in-the-money stock option awards held by each named executive officer, as described above in the section above entitled "—Treatment of Options." As required by applicable SEC rules, the amounts reported in this column were determined using the per share Merger Consideration to be received by holders of Common Stock in connection with the Merger (i.e., $3.00 per share). The amounts reported in this column represent "single-trigger" arrangements because they are conditioned solely upon the closing of the Merger.

(3)
The amounts reported in this column represent estimates of the reimbursements to be made to each named executive officer under his employment agreement of 100% of the monthly COBRA premium paid by the executive for him and his eligible dependents, based on the annual premiums historically paid by Fibrocell, for a period of 18 months (for Mr. Maslowski) or 12 months (for Mr. Buckley), following termination of employment following the Merger. These amounts constitute "double-trigger" arrangements because they are conditioned upon both the closing of the Merger and a qualifying termination of the applicable executive's employment within 90 days prior to, on or within 18 months following a change of control.

(4)
The amounts reported in this table are subject to applicable tax withholdings and do not give effect to any potential reduction in payments to a named executive officer that may occur following a determination that the amount of payments to such executive should be reduced to avoid the triggering certain excise taxes, as described above under "—Employment Agreements." Accordingly, there can be no assurance that any of Fibrocell's named executive officers will realize the full amounts reported in this column.

        Kirk Affiliates.    Two of our directors, Julian P. Kirk (who is the son of Randal J. Kirk) and Marcus E. Smith, are employees of Third Security, LLC, which is an affiliate of Randal J. Kirk. Randal J. Kirk is the chairman of the board of directors and chief executive officer of Intrexon, our collaboration partner on our gene therapy programs. Together with his affiliates NRM VII Holdings, Intrexon, Kapital Joe, LLC, and Mascara Kaboom, LLC (collectively, the "Kirk Affiliates"), Together with his affiliates, Mr. Kirk beneficially owns approximately 31% of our outstanding Common Stock on an as-converted basis, representing approximately 1.7 million shares of our Common Stock, 3,016 shares of Preferred Stock, 1,255,467 warrants, and Convertible Notes with an aggregate principal amount of approximately $6,762,500. Therefore, Mr. Kirk and his affiliates will receive consideration in the Merger for Fibrocell securities beneficially owned by them. Mr. Kirk and his affiliates may also have interests that conflict with our other stockholders stemming from our collaboration on our gene

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therapy programs and, if acting together, have the ability to significantly influence the outcome of matters submitted to our stockholders for approval.

        In addition, the Kirk Affiliates have entered into the Voting Agreement, pursuant to which the Kirk Affiliates agreed to vote their shares of securities of the Company in favor of the Merger and against any competing transaction, to support the economic treatment of such securities held by them as described in the Merger Agreement, and to forbear from taking certain actions detrimental to the Merger.

        The Kirk Affiliates have also entered into a Consent and Termination Agreement, pursuant to which the Securities Purchase Agreement will be terminated as of immediately prior to the closing of the Merger. As consideration for entry into the Termination Agreements, the Kirk Affiliates will each receive a promissory note to be issued by Merger Sub immediately prior to the Merger, in each case for an amount equal to (and in addition to) the aggregate Conversion Amount such party is entitled to in connection with such party's ownership of shares of Preferred Stock. Pursuant to the Termination Agreements and in addition to the foregoing, the Kirk Affiliates also agreed to the treatment of the Preferred Stock under the Merger Agreement and agreed to release all claims related to such party's ownership of equity in the Company.

        One of our directors, Christine St.Clare, serves on the board of directors and chairs the audit committee of AquaBounty Technologies, Inc. ("AquaBounty"). According to AquaBounty's public filings, Ms. St.Clare was nominated to the board of directors of AquaBounty by Intrexon pursuant to a relationship agreement between Intrexon and AquaBounty. AquaBounty has publicly reported that Mr. Kirk and his affiliates, including Intrexon and Third Security, LLC, own a substantial percentage of AquaBounty's outstanding shares of common stock. However, Ms. St.Clare does not have a financial interest in the Merger in connection with her affiliation with Intrexon and AquaBounty.

        In addition, MSD, a holder of shares of the Company's Preferred Stock, warrants, and Convertible Notes, entered into a Voting Agreement and a Consent and Termination Agreement on substantially similar terms as the Kirk Affiliates, concurrent with the execution of the Merger Agreement.

No Financing Condition; Financing Cooperation

        The Merger is not subject to a financing condition. Castle Creek has represented that, after giving effect to the financing contemplated by the commitment letters delivered to Fibrocell, it will have on the closing date sufficient funds available to pay the aggregate Merger Consideration, the aggregate Conversion Amount, the aggregate consideration for the Company's warrants and all related fees required to be paid by Castle Creek and the Surviving Corporation. Castle Creek has delivered to Fibrocell executed commitment letters pursuant to which Castle Creek's financing sources have agreed to provide cash equity or debt financing in an aggregate amount of up to $35 million for the Merger. Fibrocell has agreed to provide all cooperation reasonably requested by Castle Creek in connection with any financing by Castle Creek, including using reasonable best efforts to, among other things, participate in meetings, assist with preparing materials, provide documentation, and obtain letters and documentation customary for the type and nature of financing Castle Creek intends to secure.

Regulatory Waiting Periods

        The Merger is subject to the requirements of the HSR Act, which provides that the Merger may not be completed until the applicable waiting period under the HSR Act is terminated or expires. However, the parties do not anticipate that the Merger is subject to the filing requirements under the HSR Act, and as such the parties anticipate that the waiting period will not apply to the Merger.

        At any time before or after the Effective Time of the Merger, any reviewing antitrust authorities or another person could take action under the antitrust laws as it deems necessary or desirable in the

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public interest, including without limitation seeking to enjoin the completion of the Merger, seeking a rescission or other unwinding of the Merger, or permitting completion subject to regulatory concessions or conditions. We cannot assure you that a challenge to the Merger will not be made or that, if a challenge is made, it will not succeed.

Delisting and Deregistration of Common Stock

        Upon completion of the Merger, the Surviving Corporation will cause the Common Stock currently listed on Nasdaq to cease to be listed on Nasdaq and will subsequently deregister the Common Stock under the Exchange Act.

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THE MERGER AGREEMENT

        The following is a summary of the material provisions of the Merger Agreement, a copy of which is attached to this proxy statement as Annex A, and which we incorporate by reference into this proxy statement. This summary does not purport to be complete and may not contain all of the information about the Merger Agreement that is important to you. We encourage you to read the Merger Agreement carefully and in its entirety, as the rights and obligations of the parties thereto are governed by the terms of the Merger Agreement and not by this summary or any other information contained in this proxy statement.

Explanatory Note Regarding Representations, Warranties and Covenants in the Merger Agreement

        In reviewing the Merger Agreement and this summary, please remember that they have been included to provide you with information regarding the terms of the Merger Agreement and are not intended to provide any other factual information about Fibrocell, Castle Creek or any of their respective subsidiaries. The Merger Agreement contains representations and warranties and covenants by each of the parties to the Merger Agreement, which are summarized below. These representations, warranties and covenants, which are qualified and subject to important limitations agreed to by the parties in connection with negotiation of the terms of the Merger Agreement, have been made solely for the benefit of the other parties to the Merger Agreement and:

        Moreover, information concerning the subject matter of the representations, warranties and covenants in the Merger Agreement and described below may have changed since the date of the Merger Agreement and subsequent developments or new information qualifying a representation, warranty or covenant may have been included in this proxy statement or in other public filings made with the SEC. Accordingly, the representations and warranties and other provisions of the Merger Agreement should not be read alone, but instead should be read together with the information provided elsewhere in this proxy statement and in the documents incorporated by reference into this proxy statement. See "Where You Can Find More Information" beginning on page 99.

The Merger

        Subject to the terms and conditions of the Merger Agreement, Merger Sub, a wholly-owned subsidiary of Castle Creek, will merge with and into Fibrocell, with Fibrocell continuing as the surviving corporation. As a result of the Merger, Fibrocell will cease to be an independent, publicly-traded company and will become a wholly-owned subsidiary of Castle Creek. The Merger will be effective at the time a certificate of merger is filed with the Secretary of State of the State of Delaware (or, to the extent legally permissible, at a later time, if agreed upon by the parties and specified in the certificate of merger filed with the Delaware Secretary of State).

Merger Consideration

        At the Effective Time, each issued and outstanding share of Common Stock (other than (i) shares of Common Stock where the holder has properly exercised appraisal rights under Section 262 of the DGCL (and has not withdrawn such exercise or lost such rights) and (ii) shares of Common Stock

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owned by Fibrocell, Castle Creek or Merger Sub) will automatically be canceled and will cease to exist and will be converted into the right to receive $3.00 in cash, without interest and less any required withholding taxes.

Treatment of Preferred Stock

        At the Effective Time, each share of Preferred Stock will survive the Merger and will thereafter only represent the right to receive an amount in cash, without interest, equal to the Conversion Amount with respect to such share, subject to any withholding taxes, upon delivery of a Notice of Conversion in accordance with the Certificate of Designations governing the Preferred Stock.

Treatment of Warrants

        Each Common Warrant (as defined below) issued and outstanding immediately prior to the Effective Time will survive the Merger and remain outstanding, but will, upon any subsequent exercise of such Common Warrant, be entitled to receive only the Warrant Consideration (as defined below) for each share of Common Stock for which such Common Warrant was exercisable immediately prior to the closing of the Merger (the "Closing"), which amount shall be held in escrow pending the exercise of such Common Warrant or its repurchase in accordance with its terms; provided that the holder of any Common Warrant may notify the Company (or, after the Effective Time, the Surviving Corporation), by delivery thereto of a repurchase notice within the timeframe specified in the Merger Agreement that such holder is exercising the holder's right to cause the Company to repurchase such Common Warrant from such holder for the Black-Scholes Value (as defined below) of such Common Warrant, in accordance with its terms and conditions, and the Surviving Corporation shall repurchase such Common Warrants in accordance with their terms; provided, further, that in no event may any holder of Common Warrants receive both the Warrant Consideration and the Black-Scholes Value in exchange for such Common Warrant.

        Each Underwater Warrant (as defined below) issued and outstanding will survive the Merger and remain outstanding, but will, upon exercise of such warrant in accordance with its terms, be entitled to receive no consideration or securities of any kind due to the per-share exercise price set forth in each Underwater Warrant exceeding the Merger Consideration.

        Each Black-Scholes Warrant (as defined below) issued and outstanding will be treated in the same manner as the Underwater Warrants, provided that the holder of any Black-Scholes Warrant may notify the Company (or, after the Effective Time, the Surviving Corporation), by delivery thereto of a repurchase notice within the timeframe specified in the Merger Agreement that such holder is exercising the holder's right to cause the Company to repurchase such Black-Scholes Warrant from such holder for the Black-Scholes Value of such Black-Scholes Warrant, in accordance with its terms and conditions, and the Surviving Corporation shall repurchase such Black-Scholes Warrants in accordance with their terms.

        Each Convertible Note outstanding will survive the Merger and remain outstanding in accordance with its terms.

        For purposes of this summary:

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Treatment of Stock Options

        Each stock option to purchase shares of Common Stock issued under Fibrocell's equity incentive plans outstanding immediately prior to the Effective Time, whether vested or unvested, will be converted into the right to receive with respect to each share of Common Stock underlying the stock option (whether vested or unvested) an amount in cash equal to the Merger Consideration minus the exercise price of such stock option, less applicable taxes required to be withheld. If the per share exercise price of a stock option is equal to or greater than the Merger Consideration, the stock option shall terminate and be canceled for no consideration.

Directors and Officers; Certificate of Incorporation; Bylaws

        The directors of Merger Sub immediately prior to the Effective Time of the Merger or such other individuals designated by Castle Creek as of the Effective Time will, from and after the Effective Time of the Merger, be the directors of the Surviving Corporation until the earlier of their resignation or removal or until their respective successors have been duly elected and qualified. The officers of Merger Sub immediately prior to the Effective Time of the Merger or such other individuals designated by Castle Creek as of the Effective Time will, from and after the Effective Time of the Merger, be the officers of the Surviving Corporation until the earlier of their resignation or removal or until their respective successors have been duly elected and qualified.

        The certificate of incorporation of the Surviving Corporation will be amended in the Merger to be in the form of the certificate of incorporation attached as an exhibit to the Merger Agreement, until changed or amended in accordance with its terms and as provided by applicable law. In addition, Fibrocell shall take all necessary action such that, at the Effective Time, the bylaws of Fibrocell shall be amended so as to read in its entirety in the form set forth as an exhibit to the Merger Agreement, and as so amended shall be the bylaws of the Surviving Corporation until thereafter changed or amended as provided therein or by applicable law.

Stockholders Seeking Appraisal

        The Merger Agreement provides that shares of Common Stock held by those stockholders who are entitled to demand and properly demand appraisal will not be converted into the right to receive the

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Merger Consideration, but will instead be converted into the right to receive payment in cash for the fair value of their shares of Common Stock as determined in accordance with Delaware law. If a holder fails to perfect, or otherwise waives, withdraws or loses his, her or its right to appraisal of their shares, his, her or its shares will be treated as if they had been converted at the Effective Time of the Merger into and become exchangeable for the Merger Consideration without interest and the stockholder's right to appraisal will be extinguished. Fibrocell must give Castle Creek prompt notice of demands for appraisal and Fibrocell may not make a payment with respect to a demand for appraisal or settle or offer to settle or negotiate any such demands without Castle Creek's prior written consent.

        The fair value of shares of our Common Stock as determined in accordance with Section 262 of the DGCL may be more or less than (or the same as) the Merger Consideration. Stockholders who wish to exercise appraisal rights must precisely follow specific procedures. See "Appraisal Rights" beginning on page 89.

        The holders of our Preferred Stock have, pursuant to the Voting Agreements and the Consent and Termination Agreements, waived and agreed not to exercise any rights to demand appraisal.

Payment for the Shares of Common Stock

        Castle Creek will designate a paying agent reasonably acceptable to Fibrocell, and enter into an agreement with the paying agent that is reasonably acceptable to Fibrocell, to make payment of the Merger Consideration, Conversion Amount, Warrant Consideration or Black-Scholes Value, as applicable, as contemplated by the Merger Agreement. At or prior to the Effective Time, Castle Creek shall deposit, or cause to be deposited, with the paying agent cash in immediately available funds in an amount sufficient for the paying agent to distribute the Merger Consideration, and, to the extent necessary for payment at the Effective Time, the Conversion Amount and the Warrant Consideration or the Black-Scholes Value, as applicable.

        As soon as practicable after the Effective Time, the paying agent will send each holder of record of a certificate representing shares of Common Stock converted into the right to receive the Merger Consideration a customary letter of transmittal and instructions advising such holder on how to surrender such shares of Common Stock in exchange for the Merger Consideration. The paying agent will promptly pay such holders the Merger Consideration upon (i) the surrender of a certificate for cancelation to the paying agent and (ii) delivery of a properly completed letter of transmittal and any other documents reasonable required by the paying agent. Interest will not be paid or accrue in respect of cash payments. The amount of any cash payments paid to you will be reduced by any applicable withholding taxes. YOU SHOULD NOT SURRENDER YOUR SHARES OF COMMON STOCK WITHOUT A LETTER OF TRANSMITTAL.

        If any stock certificate shall have been lost, stolen or destroyed, upon the making of an affidavit of that fact by the person claiming such stock certificate to be lost, stolen or destroyed and, if required by Castle Creek, the posting by such person of a bond in such reasonable sum as Castle Creek may direct as indemnity against any claim that may be made against it with respect to such stock certificate, the paying agent, Merger Sub, or the Surviving Corporation, as the case may be, shall pay the Merger Consideration in respect of such lost, stolen or destroyed stock certificate.

        If payment of the Merger Consideration is to be made to a stockholder other than a stockholder in whose name any surrendered certificate is registered, it shall be a condition precedent of payment that the certificate so surrendered shall be properly endorsed or shall be otherwise in proper form for transfer, and the holder requesting such payment shall have paid any transfer and other similar taxes required by reason of the payment of the Merger Consideration to a holder other than the registered holder of the certificate so surrendered and shall have established to the satisfaction of the Surviving Corporation that such taxes either have been paid or are not required to be paid. No interest will be paid or accrued on any amount payable upon due surrender of the certificates.

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        For holders of uncertificated shares of Common Stock represented in book-entry (the "Book-Entry Company Shares") held through the Depository Trust Company, no executed letter of transmittal to the paying agent to receive the Merger Consideration is required. In lieu thereof, each holder of record of Book-Entry Company Shares shall, upon receipt of an "agent's message" by the paying agent (or such other evidence of transfer or surrender as the Paying Agent may reasonably request), be entitled to receive, and paying agent will to pay to The Depository Trust Company as promptly as practicable after the Effective Time, the Merger Consideration in respect of each such Book-Entry Company Share. For holders of Book-Entry Company Shares not held through the Depository Trust Company, the paying agent will mail (A) a letter of transmittal and (B) instructions for returning such letter of transmittal in exchange for the Merger Consideration. Upon delivery of such letter of transmittal, the holder of such Book-Entry Company Shares shall be entitled to receive in exchange therefor the Merger Consideration.

Payment for the Shares of Preferred Stock

        As soon as practicable after the Effective Time, the paying agent will mail to each holder of record of shares of Preferred Stock, which shares shall, at the Effective Time, represent the right to receive the Conversion Amount: (A) a notice of conversion in the form set forth in the Certificate of Designations ("Notice of Conversion"); (B) a letter of transmittal; and (C) instructions for effecting the conversion of the shares of Preferred Stock in exchange for payment of the Conversion Amount. Upon delivery of the Notice of Conversion to the Surviving Corporation, together with delivery to the paying agent or the Surviving Corporation of an executed letter of transmittal and such other documents as may be reasonably required pursuant to such instructions, the holder of such shares of Preferred Stock shall be entitled to receive the Conversion Amount (without interest), and any share of Preferred Stock represented by such Notice of Conversion shall forthwith be cancelled.

        If payment of the Conversion Amount is to be made to a person other than the holder in whose name any share of Preferred Stock is registered, it shall be a condition precedent of payment that the transfer of such share of Preferred Stock be properly documented in accordance with the requirements of the Certificate of Designations and the Surviving Corporation, and the Person requesting such payment shall have paid any transfer and other similar Taxes required by reason of the payment of the Conversion Amount to a Person other than the registered holder of such share of Preferred Stock so converted and shall have established to the satisfaction of the Surviving Corporation that such taxes either have been paid or are not required to be paid. No interest will be paid or accrued on any amount payable upon conversion of the shares of Preferred Stock.

Payment for Warrants

        As soon as practicable after the Effective Time, the paying agent will mail to each holder of record of Company Warrants, other than the Underwater Warrants: (A) a form of notice of exercise in the form set forth in the applicable Company Warrant ("Notice of Exercise"); (B) a form of notice of repurchase requiring the Surviving Corporation to repurchase such Common Warrants or Black-Scholes Warrants at their Black-Scholes Value (the "Repurchase Notice"); (C) a letter of transmittal, and (D) instructions for requiring the repurchase by the Surviving Corporation of such Company Warrants in exchange for their Black-Scholes Value and, with respect to the Common Warrants, for effecting the exercise of the Common Warrants in exchange for payment of the Warrant Consideration (including notice that any Repurchase Notice must be delivered to the Surviving Corporation within 30 days after the applicable Warrant Repurchase Date (as defined in the Merger Agreement)). Upon delivery of the Repurchase Notice or Notice of Exercise to the Surviving Corporation, together with delivery to the paying Agent or the Surviving Corporation of an executed letter of transmittal, with respect to such Notice of Exercise or Repurchase Notice, and such other documents as may be reasonably required pursuant to such instructions, the holder of such Company Warrants shall be entitled to receive the

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Warrant Consideration with respect to each share of Common Stock for which such Company Warrant was exercisable immediately prior to the Effective Time, or the Black-Scholes Value with respect to such Company Warrant, as applicable (in each case without interest and after giving effect to any required tax withholdings).

        If payment of the Warrant Consideration or Black-Scholes Value, as applicable, is to be made to a person other than the holder in whose name any Company Warrant is registered, it shall be a condition precedent of payment that the transfer of such Company Warrant be properly documented in accordance with the requirements, terms and conditions of such Company Warrant (including delivery of any form of assignment attached to such Company Warrant), and the person requesting such payment shall have paid any transfer and other similar taxes required by reason of the payment of the Warrant Consideration or Black-Scholes Value to a person other than the registered holder of the Company Warrant so exercised or repurchased and shall have established to the satisfaction of the Surviving Corporation that such taxes either have been paid or are not required to be paid. No interest will be paid or accrued on any amount payable upon exercise or repurchase of the Company Warrants.

Representations and Warranties

        The Merger Agreement contains representations and warranties made by Fibrocell to Castle Creek and Merger Sub, including, among other things, representations and warranties relating to:

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        The Merger Agreement also contains representations and warranties made by Castle Creek and Merger Sub to Fibrocell, including representations and warranties relating to:

        The representations and warranties of each of the parties to the Merger Agreement will expire upon completion of the Merger.

Conduct of Business Pending the Merger

        From the date of the Merger Agreement through the Effective Time of the Merger, Fibrocell has agreed (and has agreed to cause its subsidiaries) to (i) use its reasonable best efforts to conduct its operations in all material respects in the ordinary course of business, (ii) use its reasonable best efforts to keep available the services of the current officers, key employees and consultants of Fibrocell and each of its subsidiaries and to preserve the goodwill and current relationships of Fibrocell and each of its Subsidiaries with customers, suppliers and other persons with which the Company or any of its Subsidiaries has significant business relations, (iii) use its reasonable best efforts to preserve in all material respects its present properties and its tangible and intangible assets, (iv) comply in all material respects with all applicable laws and Fibrocell's material contracts, (v) pay all applicable taxes as such taxes become due and payable, and (vi) maintain all existing licenses and permits applicable to its operations and businesses.

        In addition, during the same period, Fibrocell has also agreed that, subject to certain exceptions, without the prior written consent of Castle Creek, it will not, and will not permit its subsidiaries to:

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Meeting of Our Stockholders

        Fibrocell has agreed to, as promptly as practicable after the date of the Merger Agreement, establish a Record Date for, duly call, give notice of, convene and hold a Special Meeting of stockholders for the sole purpose of considering and taking action upon the adoption of the Merger Agreement and voting on the Adjournment Proposal and the Compensation Proposal, which meeting is the subject of this proxy statement. Fibrocell, after consultation with Castle Creek, may postpone or adjourn, or make one or more successive postponements or adjournments of, the Special Meeting to the extent necessary to solicit additional proxies in favor the Merger Proposal, provided that (i) such adjournment shall not exceed fifteen calendar days for each such adjournment, (ii) the Special Meeting shall not be adjourned by more than forty-five calendar days in the aggregate from the originally scheduled date, and (iii) no such adjournment shall be permitted if Fibrocell shall have received by the Special Meeting an aggregate number of proxies voting for the Merger Proposal, which have not been withdrawn, such that the Merger Proposal would pass if a vote were taken at the Special Meeting.

Efforts to Complete the Merger

        Subject to the terms and conditions set forth in the Merger Agreement, Fibrocell, Castle Creek and Merger Sub have agreed to use reasonable best efforts to take, or cause to be taken, all actions that are necessary, proper or advisable to complete and make effective the Merger and the other transactions contemplated by the Merger Agreement, including using reasonable best efforts to accomplish the following: (i) obtain all consents, approvals or waivers from, or participation in other discussions or negotiations with, third parties, including under any contract to which the Company or Castle Creek or any of their respective subsidiaries is party or by which such person or any of their respective properties or assets may be bound (provided, that the Company shall not pay or agree to pay any material consent fees or other material payments requested by any such third parties without the written consent of Castle Creek, not to be unreasonably withheld, conditioned or delayed), (ii) obtain all necessary actions or nonactions, waivers, consents, approvals, orders and authorizations from governmental entities (including, without limitation, those in connection with applicable competition laws), make all necessary registrations, declarations and filings with and take all steps as may be necessary to obtain an approval or waiver from, or to avoid any proceeding by, any governmental entities (including, without limitation, in connection with applicable competition laws),

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(iii) resist, contest or defend any proceeding (including administrative or judicial proceedings) challenging the Merger or that could restrict, prevent or prohibit consummation of the related transactions, and (iv) execute and deliver any additional instruments necessary to consummate the transactions and fully to carry out the purposes of the Merger Agreement.

Employee Matters

        The Merger Agreement provides that, for the twelve month period following the Effective Time of the Merger, Castle Creek shall cause the Surviving Corporation to provide to each continuing employee ("Continuing Employee") of Fibrocell and its subsidiaries with (A) a base salary or wage rate that is not less than the base salary or wage rate provided to the Continuing Employee immediately prior to Closing, (B) annual cash incentive compensation (excluding equity incentive compensation) no less favorable than the cash incentive compensation (excluding equity incentive compensation) provided to the Continuing Employee immediately before the Closing, and (C) severance benefits in amounts and on terms and conditions that are no less favorable than those provided to the Continuing Employee immediately prior to the Closing. For the twelve month period following the Effective Time of the Merger, Castle Creek shall cause the Surviving Corporation to provide each Continuing Employee benefits that are substantially similar in the aggregate to (i) the employee benefits provided to the Continuing Employee under the Fibrocell benefit plans immediately prior the Closing or (ii) at Castle Creek's sole discretion, the employee benefits provided to similarly situated employees of Castle Creek; provided, that, for purposes of determining whether such employee benefits are substantially similar in the aggregate, defined benefit pension benefits, retention or change in control payments or awards provided by Fibrocell or its subsidiaries prior to the Closing shall not be taken into account.

        For purposes of vesting, eligibility to participate and level of benefits under the employee benefit plans of Castle Creek or the Surviving Corporation and their Subsidiaries providing benefits to each Continuing Employee after the Effective Time of the Merger (the "New Plans"), each Continuing Employee shall be credited with his or her years of service with the Company prior to the Closing, to the same extent as such Continuing Employee was entitled, prior to the Closing, to credit for such service under any similar Company benefit plan in which such Continuing Employee participated or was eligible to participate immediately prior to the Closing, except to the extent such credit would result in duplication of benefits or accruals under any defined benefit pension plans.

        In addition, Castle Creek shall use commercially reasonable efforts to provide that (i) each Continuing Employee is immediately eligible to participate, without any waiting time, in any and all New Plans to the extent coverage under such New Plan is replacing a Company benefit plan in which such Continuing Employee participated immediately prior to the Closing (such plans, collectively, the "Old Plans") (ii) for purposes of each New Plan providing medical, dental, pharmaceutical, vision, life insurance and/or disability benefits to any Continuing Employee, all pre-existing condition exclusions and actively-at-work requirements of such New Plan be waived for such employee and his or her covered dependents, unless such conditions would not have been waived under the comparable plans of the Company in which such employee participated immediately prior to the Closing, and (iii) any eligible expenses incurred by such employee and his or her covered dependents during the portion of the plan year of the Old Plans ending in the year in which the Closing occurs to be taken into account under the applicable New Plan for purposes of satisfying all deductible, coinsurance and maximum out-of-pocket requirements applicable to such employee and his or her covered dependents for the applicable plan year as if such amounts had been paid in accordance with such New Plan (but only to the extent such credit would have been given under the comparable Old Plan prior to the Closing).

        Unless otherwise requested by Castle Creek at least ten days prior to the Closing, Fibrocell shall terminate the Fibrocell Technologies Inc. 401(k) Profit Sharing Plan and Trust, effective as of the day immediately prior to the Effective Time and contingent upon the occurrence of the Effective Time.

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Indemnification and Insurance

        The Merger Agreement provides that following the Merger, for a period of six years from and after the Effective Time, the Surviving Corporation will assume all rights to indemnification, advancement of expenses and exculpation from liabilities for acts or omissions occurring at or prior to the Merger existing in favor of any person who is or prior to the Effective Time of the Merger becomes or has been at any time prior to the date of the Merger Agreement a director or officer of Fibrocell or any of its subsidiaries as provided in their respective certificates of incorporation or bylaws (or comparable organizational documents) and any indemnification or other agreements of Fibrocell or its subsidiaries as in effect on the date of the Merger Agreement, and shall not be amended, repealed or otherwise modified in any manner that would adversely affect any right thereunder for any indemnified party. Prior to the Effective Time of the Merger, Fibrocell shall purchase a six-year "tail" directors' and officers' liability insurance policy, subject to a cap on aggregate premiums, for acts or omissions occurring prior to the Merger.

No Financing Condition; Financing Cooperation

        The Merger is not subject to a financing condition. Castle Creek has represented that, after giving effect to the financing contemplated by the commitment letters delivered to Fibrocell, it will have on the closing date sufficient funds available to pay the aggregate Merger Consideration, the aggregate Conversion Amount, the aggregate consideration for the Company's warrants and all related fees required to be paid by Castle Creek and the Surviving Corporation. Castle Creek has delivered to Fibrocell executed commitment letters pursuant to which Castle Creek's financing sources have agreed to provide financing for the Merger. Fibrocell has agreed to provide all cooperation reasonably requested by Castle Creek in connection with any financing by Castle Creek, including using reasonable best efforts to, among other things, participate in meetings, assist with preparing materials, provide documentation, and obtain letters and documentation customary for the type and nature of financing Castle Creek intends to secure.

Conditions to the Merger

        The consummation of the Merger is subject to certain customary closing conditions, as described further below.

        Conditions to Each Party's Obligation.    Each party's obligation to effect the Merger is subject to the satisfaction or, to the extent legally permissible, waiver of the following conditions:

        Conditions to Castle Creek's and Merger Sub's Obligations.    The obligations of Castle Creek and Merger Sub to effect the Merger are further subject to the satisfaction or, to the extent legally permissible, waiver by Castle Creek of the following conditions:

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        A "material adverse effect" with respect to Fibrocell means any change, event, condition, occurrence, state of facts, development or effect (an "Effect") that, individually or in the aggregate, (i) has a material adverse effect on the business, properties, assets, condition or results of operations of Fibrocell and its subsidiaries, taken as a whole; provided, however, that adverse Effects arising out of, resulting from or attributable to the following will not constitute a material adverse effect, and shall not otherwise be taken into account in determining whether a material adverse effect has occurred or would reasonably be expected to occur, except that Effects with respect to clauses (a), (b) and (c) of the below shall be so considered to the extent such Effect disproportionately impacts the Company and its Subsidiaries, taken as a whole, relative to other companies operating in the same industries: (a) changes or proposed changes in applicable laws, GAAP or the interpretation or enforcement thereof, (b) changes in general economic, business, labor or regulatory conditions, or changes in securities, credit or other financial markets, including interests rates or exchange rates, in the United States or globally, or changes generally affecting the industries (including seasonal fluctuations) in which the Company or its subsidiaries operate in the United States or globally, (c) changes in global or national political conditions (including the outbreak or escalation of war (whether or not declared), military action, sabotage or acts of terrorism), changes due to natural disasters or changes in the weather or changes due to the outbreak or worsening of an epidemic, pandemic or other health crisis, (d) any change in supplier, employee, financing source, regulatory, partner, customer, client or similar relationships directly resulting from the public announcement or pendency of the Merger Agreement and the Merger, (e) litigation related to the Merger, (f) the performance of the Merger Agreement and the Merger, including compliance with covenants set forth therein, or any action taken or omitted to be taken by the Company or any of its subsidiaries (excluding the requirement that the Company use reasonable best efforts to operate in the ordinary course of business or any restriction that otherwise permits the Company and its Subsidiaries to operate in the ordinary course of business) at the request of Castle Creek prior to the taking or the omission of such action, (g) changes in the trading price or trading volume of the Common Stock or any suspension of trading, provided that the underlying facts or circumstances giving rise or contributing to such changes may be taken into account in determining whether a material adverse effect has occurred, (h) any failure by the Company or any of its subsidiaries to meet any revenue, earnings or other financial projections or forecasts, provided that the underlying facts or circumstances giving rise or contributing to such changes may be taken into account in determining whether a material adverse effect has occurred, or (i) changes generally affecting

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products competitive with the products and services made or currently intended to be made commercially available or otherwise distributed, or currently under development, by the Company or any of its Subsidiaries, or (ii) would prevent or materially impair or delay the consummation by the Company of the transactions contemplated by the Merger Agreement.

        Conditions to Fibrocell's Obligation.    Fibrocell's obligation to effect the Merger is further subject to the satisfaction, to the extent legally permissible, or waiver by Fibrocell of the following conditions:

        A "material adverse effect" with respect to Castle Creek means any change, event, condition, occurrence, state of facts, development or effect that, individually or in the aggregate, prevents or materially impairs or delays (beyond February 12, 2020 (or such later date as the parties may agree, the "Outside Date")) the consummation by Castle Creek or Merger Sub of the Merger or any of the other transactions contemplated the Merger Agreement.

No Solicitation of Other Offers

        The Merger Agreement provides that Fibrocell shall not, and shall cause its subsidiaries and its and their respective representatives not to, directly or indirectly, (A) initiate, solicit, knowingly facilitate or knowingly encourage any Acquisition Proposal or the making or submission thereof, (B) engage in, continue or otherwise participate in any discussions or negotiations with a third party regarding any Acquisition Proposal or (C) furnish or provide any nonpublic information in connection with, any Acquisition Proposal. In addition, Fibrocell was required under the Merger Agreement to, and to cause its subsidiaries and representatives to (i) immediately cease and cause to be terminated any discussions or negotiations with any third party conducted prior to the date of the Merger Agreement with respect to any Acquisition Proposal, (ii) deliver a written notice to any such third party explicitly stating that the Company is terminating all discussions and negotiations with such third party with respect to any Acquisition Proposal, and requesting that such third party promptly return or destroy all confidential or proprietary information concerning the Company and its subsidiaries and (iii) promptly terminate access to any due diligence or electronic or physical data room with respect to any Acquisition Proposal.

        In addition, except as expressly permitted by the Merger Agreement, until the Effective Time, or, if earlier, the termination of the Merger Agreement, neither the Fibrocell Board (acting upon the recommendation of the Special Committee, or otherwise) nor the Special Committee or any other committee thereof may (i) adopt, approve or recommend, or publicly propose to adopt, approve or recommend, any Acquisition Proposal, (ii) withdraw, change, qualify, withhold or modify, or publicly propose to withdraw, change, qualify, withhold or modify, in a manner adverse to Castle Creek or Merger Sub, the Fibrocell Board's recommendation that the Company's stockholders adopt the Merger Agreement (the "Company Board Recommendation"), (iii) fail to include the Company Board Recommendation in this proxy statement, (iv) in the event a tender offer that constitutes an Acquisition Proposal is commenced, fail to recommend against such Acquisition Proposal in any solicitation or recommendation statement within ten business days of such commencement, (v) approve, authorize or cause or permit the Company or any of its Subsidiaries to enter into any merger

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agreement, acquisition agreement, letter of intent, memorandum of understanding or other similar agreement relating to any Acquisition Proposal (a "Company Acquisition Agreement"), (vi) fail to publicly affirm the Company Board Recommendation within five business days following receipt of a written request to do so from Castle Creek or (vii) resolve or agree to do any of the foregoing (any action set forth in the foregoing clauses (i) through (iv), (vi) and (vii) of this sentence, a "Change of Board Recommendation").

        Notwithstanding the foregoing restriction, at any time prior to obtaining the requisite stockholder approval, in response to a bona fide written unsolicited Acquisition Proposal received after the execution of the Merger Agreement which did not result from a material breach of the no solicitation provision of the merger agreement, (i) the Company and its representatives may contact the person proposing such Acquisition Proposal or the representatives of such person solely to clarify the terms and conditions thereof and (ii) if the Special Committee (or a duly authorized committee thereof) determines in good faith, after consultation with its financial advisors and outside legal counsel, based on information then available, that such Acquisition Proposal constitutes, or is reasonably likely to result in, a Superior Proposal and that failure to take such actions would be reasonably likely to breach the directors' fiduciary duties under applicable law, then the Company may (A) furnish information with respect to the Company and its subsidiaries to the third party making such Acquisition Proposal, its representatives and potential sources of financing pursuant to an acceptable confidentiality agreement and (B) participate in discussions or negotiations with the third party making such Acquisition Proposal regarding such Acquisition Proposal; provided that any non-public information concerning the Company or its subsidiaries provided to any third party shall, to the extent not previously provided or made available to Castle Creek or Merger Sub, be provided to Castle Creek or Merger Sub as promptly as reasonably practicable.

        The term "Acquisition Proposal" means any inquiry, offer or proposal from a third party concerning (A) a merger, consolidation or other business combination or similar transaction involving the Company, (B) a sale, lease or other disposition by merger, consolidation, business combination, share exchange, joint venture or otherwise, of assets of the Company (including equity interests of any subsidiary of the Company) or its Subsidiaries representing 20% or more of the consolidated assets of the Company and its subsidiaries in a single transaction or series of related transactions, based on their fair market value as determined in good faith by the Fibrocell Board and the Special Committee, (C) an issuance or acquisition (including by way of merger, consolidation, business combination or share exchange) of equity interests representing 20% or more of the voting power of the Company in a single transaction or series of related transactions, or (D) any combination of the foregoing (in each case, other the Merger).

        The Term "Superior Proposal" means a bona fide written Acquisition Proposal (except the references therein to "20%" shall be replaced by "75%") made by a third party that is not solicited or received in violation, or resulting from any breach, of the non-solicitation provision of the Merger Agreement and that the Fibrocell Board (acting upon the recommendation of the Special Committee) determines in good faith, after consultation with its financial advisors and outside legal counsel, taking into account such factors as the Fibrocell Board (acting upon the recommendation of the Special Committee) considers in good faith to be appropriate (including the financing terms, conditionality, timing and likelihood of consummation of such proposals), (A) is reasonably likely to be consummated in accordance with its terms, and (B) if consummated, would be more favorable from a financial point of view to holders of Common Stock than the Merger (taking in account any proposed change in terms to the Merger Agreement from Castle Creek or Merger Sub as described below).

Changes in Board Recommendation

        Notwithstanding the limitations described above regarding a Change of Board Recommendation, prior to the approval of the Fibrocell stockholders of the Merger Proposal, the Fibrocell Board may,

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under certain circumstances, effect a Change of Board Recommendation or terminate the Merger Agreement pursuant to the terms of the Merger Agreement to accept a Superior Proposal, if:

Termination of the Merger Agreement

        The Merger Agreement may be terminated any time prior to completion of the Merger under the following conditions:

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Termination Fees and Expenses

Termination Fee

        Fibrocell shall pay to Castle Creek a termination fee of $2.0 million in the event that:

        Castle Creek shall pay to Fibrocell a termination fee of $2.0 million in the event that the Merger Agreement is (i) terminated by the Company if (A) there has been a breach by Castle Creek or Merger Sub of any of its representations or covenants that would result in the failure of the closing conditions to be satisfied, unless such breach is capable of being cured prior to the Outside Date or is not cured within 30 days of receiving notice of such breach or (B) if all of the closing conditions have been satisfied or waived, the Company has delivered irrevocable written notice to Castle Creek stating that, if Castle Creek performs its obligations, the closing will occur, and Castle Creek fails to consummate Merger by the later of three business days following delivery of such notice or the third business day after satisfaction or waiver of all closing conditions, or (ii) terminated by either party because the

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Merger has otherwise not closed by the Outside Date at a time when Fibrocell could have terminated the Merger Agreement due to either of clauses (i)(A) or (i)(B) of this paragraph.

Reimbursement of Expenses

        All out-of-pocket costs and expenses incurred in connection with the Merger Agreement and the transactions contemplated thereby will be paid by the party incurring such cost or expenses.

Amendment, Extension and Waiver

        The parties may amend provisions of the Merger Agreement at any time, except that after approval of Fibrocell's stockholders has been obtained, no amendment that requires further approval by stockholders of Fibrocell is permitted without the further approval of such stockholders. All such amendments must be in writing and signed by each of the parties.

        At any time prior to the Effective Time of the Merger, the parties may (a) extend the time for the performance of any of the obligations or other acts of the other, (b) waive any breach of the representations and warranties of the other contained in the Merger Agreement or in any document delivered pursuant thereto or (c) waive compliance by the other with any of the agreements or covenants contained in the Merger Agreement. Any such extension or waiver shall be valid only if set forth in an instrument in writing signed by the party or parties to be bound thereby, but such extension or waiver or failure to insist on strict compliance with an obligation, covenant, agreement or condition shall not operate as a waiver of, or estoppel with respect to, any subsequent or other failure.

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MATERIAL U.S. FEDERAL INCOME TAX CONSEQUENCES OF THE MERGER

        The following discussion is a summary of the material U.S. federal income tax consequences to holders of Common Stock whose shares are converted to cash in the Merger. This summary does not address any tax consequences of the Merger arising under the laws of any state, local or foreign jurisdiction or U.S. federal laws other than U.S. federal income tax laws and does not address tax considerations applicable to holders who receive cash pursuant to the exercise of appraisal rights or to persons who hold Preferred Stock or Company Warrants. In addition, this discussion does not address the U.S. federal income tax consequences to dissenting stockholders. This discussion is based on the Code, applicable U.S. Treasury Regulations promulgated thereunder, published positions of the Internal Revenue Service, court decisions and other applicable authorities, all as in effect as of the date hereof and all of which are subject to change or differing interpretations (possibly with retroactive effect). This discussion does not address all aspects of U.S. federal income taxation that may be applicable to holders of Common Stock in light of their particular circumstances or persons subject to special treatment under U.S. federal income tax law, such as:

        Holders of Company Stock are encouraged to consult their own tax advisors to determine the particular tax consequences to them of the receipt of cash in exchange for shares of Common Stock pursuant to the Merger (including the application and effect of any state, local or non-U.S. income and other tax laws).

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        If a partnership (including any entity or arrangement treated as a partnership for U.S. federal income tax purposes) holds shares of Common Stock, the tax treatment of a partner in the partnership generally will depend upon the status of the partner and the activities of the partnership. Partners in a partnership holding shares of Common Stock are encouraged to consult their tax advisors regarding the tax consequences of the Merger.

        This discussion applies only to persons that hold their shares of Common Stock as a capital asset within the meaning of Section 1221 of the Code. We intend this discussion to provide only a general summary of the material U.S. federal income tax consequences of the Merger to holders of Common Stock. We do not intend it to be a complete analysis or description of all potential U.S. federal income tax consequences of the Merger. The U.S. federal income tax laws are complex and subject to varying interpretation. Accordingly, the Internal Revenue Service may not agree with the tax consequences described herein.

        For purposes of this discussion, the term "U.S. holder" means a beneficial owner of Common Stock that is:

        A "non-U.S. holder" means a beneficial owner (other than a partnership) of Common Stock that is not a U.S. holder.

        The exchange of shares of Common Stock for cash in the Merger generally will be a taxable transaction for U.S. federal income tax purposes. In general, a U.S. holder whose shares of Common Stock are converted into the right to receive cash in the Merger will recognize capital gain or loss for U.S. federal income tax purposes in an amount equal to the difference, if any, between the amount of cash received with respect to such shares (determined before the deduction of any applicable withholding taxes) and the U.S. holder's adjusted tax basis in such shares. A U.S. holder's adjusted tax basis generally will equal the price the U.S. holder paid for such shares. Such gain or loss generally will be long-term capital gain or loss if the U.S. holder's holding period for the shares of Common Stock exceeds one year at the time of the completion of the Merger. Long-term capital gains of non-corporate U.S. holders generally are subject to reduced rates of taxation. The deductibility of capital losses is subject to limitations. If a U.S. holder acquired different blocks of shares of Common Stock at different times or different prices, such U.S. holder must determine its adjusted tax basis, holding period, and gain or loss separately with respect to each block of shares of Common Stock. Capital gains recognized by individuals, trusts and estates also may be subject to a 3.8% federal Medicare contribution tax. Stockholders that are individuals, estates or trusts should consult their tax advisors regarding the applicability of the Medicare tax to gain recognized from the disposition of shares of Common Stock in the Merger.

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        A U.S. holder may, under certain circumstances, be subject to information reporting and backup withholding (at a rate of 24%) with respect to the cash received pursuant to the Merger, unless such holder properly establishes an exemption or provides its correct taxpayer identification number and otherwise complies with the applicable requirements of the backup withholding rules. Backup withholding is not an additional tax. Any amounts withheld under the backup withholding rules may be refunded or credited against a U.S. holder's U.S. federal income tax liability, if any, provided that such U.S. holder furnishes the required information to the Internal Revenue Service in a timely manner. All U.S. holders surrendering shares of Common Stock pursuant to the Merger should duly complete and sign, under penalty of perjury, the Internal Revenue Service Form W-9 included as part of the letter of transmittal and return it to the paying agent to provide the information, including such holder's taxpayer identification number, and certifications necessary to avoid backup withholding (unless an applicable exemption exists and is proved in a manner satisfactory to us and the paying agent). Corporations are not subject to backup withholding.

        A non-U.S. holder generally will not be subject to U.S. federal income tax on any gain recognized on the receipt of cash in exchange for shares of Common Stock pursuant to the Merger unless:

        A non-U.S. holder will be subject to information reporting, and in certain circumstances, backup withholding will apply, with respect to the cash received by a non-U.S. holder pursuant to the Merger, unless such holder certifies under penalties of perjury that it is not a United States person, as defined under the Code, and the payor does not have actual knowledge or reason to know that the holder is a United States person or such holder otherwise establishes an exemption from backup withholding. Backup withholding is not an additional tax. Any amounts withheld under the backup withholding rules

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may be refunded or credited against a non-U.S. holder's U.S. federal income tax liability, if any, provided that such non-U.S. holder furnishes the required information to the Internal Revenue Service in a timely manner. In order to avoid backup withholding, a non-U.S. holder exchanging shares of Common Stock for cash pursuant to the Merger should submit with the letter of transmittal a duly completed and signed applicable Internal Revenue Service Form W-8, which may be obtained from the paying agent or at www.irs.gov.

        This summary of material U.S. federal income tax consequences is for general information only and is not tax advice. You are urged to consult your tax advisor with respect to the application of U.S. federal income tax laws to your particular situation as well as any tax consequences arising under the U.S. federal estate or gift tax rules, or under the laws of any state, local, foreign or other taxing jurisdiction.

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APPRAISAL RIGHTS

        Under Section 262 of the DGCL, you have the right to dissent from the Merger and to receive payment in cash for the "fair value" of your shares of Common Stock as determined by the Delaware Court of Chancery, together with interest, if any, as determined by the court, but exclusive of any element of value arising from the accomplishment or expectation of the Merger, in lieu of the Merger Consideration you would otherwise be entitled to pursuant to the Merger Agreement. These rights are known as appraisal rights. Fibrocell stockholders electing to exercise appraisal rights must comply with the provisions of Section 262 of the DGCL in order to perfect their rights. Fibrocell will require strict compliance with the statutory procedures.

        The following is intended as a brief summary of the material provisions of the Delaware statutory procedures required to be followed properly and in a timely manner by a Fibrocell stockholder in order to perfect appraisal rights.

        This summary, however, is not a complete statement of all applicable requirements and is qualified in its entirety by reference to Section 262 of the DGCL, the full text of which appears in Annex C to this proxy statement. Failure to precisely follow any of the statutory procedures set forth in Section 262 of the DGCL may result in a termination or waiver of your appraisal rights. Moreover, due to the complexity of the procedures for exercising appraisal rights, stockholders who are considering exercising such rights are encouraged to seek the advice of legal counsel. This summary does not constitute any legal or other advice, nor does it constitute a recommendation that you exercise your appraisal rights under Section 262 of the DGCL. All references in Section 262 of the DGCL and in this summary to a "stockholder" are to the record holder of shares of Common Stock, unless otherwise indicated.

        Section 262 of the DGCL requires that stockholders for whom appraisal rights are available be notified not less than 20 days before the stockholders' meeting where the Merger Agreement will be voted on that appraisal rights will be available. A copy of Section 262 of the DGCL must be included with such notice. This proxy statement constitutes Fibrocell's notice to Fibrocell stockholders of the availability of appraisal rights in connection with the Merger in compliance with the requirements of Section 262 of the DGCL and a copy of Section 262 of the DGCL is attached hereto as Annex C. If you wish to consider exercising your appraisal rights, you should carefully review the text of Section 262 of the DGCL contained in Annex C to this proxy statement, since failure to timely and properly comply with the requirements of Section 262 of the DGCL will result in the loss of your appraisal rights under the DGCL.

        If you elect to demand appraisal of your shares, you must satisfy each of the following conditions.

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        If you fail to comply with any of these conditions and the Merger is completed, you will be entitled to receive the Merger Consideration, but you will have no appraisal rights with respect to your shares of Common Stock.

        All demands for appraisal should be addressed to Fibrocell Science, Inc., 405 Eagleview Blvd., Exton, PA 19341, Attn: Corporate Secretary, and must be delivered before the vote on the Merger Agreement is taken at the Special Meeting and must be executed by, or on behalf of, the record holder of the shares of Common Stock, fully and correctly, as the stockholder's name appears in the stock ledger. The demand must reasonably inform Fibrocell of the identity of the Fibrocell stockholder, and the intention of the Fibrocell stockholder to demand appraisal of his, her or its shares of Common Stock.

        Beneficial owners who do not also hold their shares of Common Stock of record may not directly make appraisal demands to Fibrocell. The beneficial holder must, in such cases, have the registered owner, such as a brokerage firm, bank, trust or other nominee, submit the required demand in respect of those shares. If shares of Common Stock are owned of record in a fiduciary capacity, such as by a trustee, guardian or custodian, execution of a demand for appraisal should be made by or for the fiduciary, and if the shares of Common Stock are owned of record by more than one person, as in a joint tenancy or tenancy in common, the demand should be executed by or for all joint owners. An authorized agent, including an authorized agent for two or more joint owners, may execute the demand for appraisal for a stockholder of record; however, the agent must identify the record owner or owners, and expressly disclose the fact that, in executing the demand, he or she is acting as agent for the record owner. A record owner, such as a broker, who holds shares of Common Stock as a nominee for others, may exercise his or her right of appraisal with respect to the shares of Common Stock held for one or more beneficial owners, while not exercising this right for other beneficial owners. In that case, the written demand should state the number of shares of Common Stock as to which appraisal is sought. Where no number of shares is expressly stated, the demand will be presumed to cover all shares held in the name of the record owner.

        If you hold your shares of Common Stock in an account with a broker, bank, trust company or other nominee, and you wish to exercise appraisal rights, you are urged to consult with your broker, bank, trust company or other nominee to determine the appropriate procedures for the making of a demand for appraisal.

        Within 10 days after the Effective Time of the Merger, the Surviving Corporation must give notice that the Merger has become effective to each former Fibrocell stockholder who has properly filed a written demand for appraisal and who did not vote in favor of the adoption of the Merger Agreement. At any time within 60 days after the Effective Time of the Merger, any former Fibrocell stockholder who has demanded an appraisal and who has not commenced an appraisal proceeding or joined such a proceeding as a named party, will have the right to withdraw the demand for appraisal and to accept the cash payment specified by the Merger Agreement for his, her or its shares of Common Stock; after this 60-day period, the former Fibrocell stockholder may withdraw such demand for appraisal only with the written consent of the Surviving Corporation. Within 120 days after the Effective Time of the Merger, any former Fibrocell stockholder who has complied with Section 262 of the DGCL will, upon written request to the Surviving Corporation, be entitled to receive a statement setting forth the

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aggregate number of shares not voted in favor of the adoption of the Merger Agreement and with respect to which demands for appraisal have been received, and the aggregate number of holders of such shares. A person who is the beneficial owner of shares of Common Stock held in a voting trust or by a nominee on behalf of such person may, in such person's own name, request from the Surviving Corporation the statement described in the previous sentence. Such statement will be given to the requesting former Fibrocell stockholder within 10 days after such written request is received by the Surviving Corporation or within 10 days after expiration of the period for delivery of demands for appraisal, whichever is later. Within 120 days after the Effective Time of the Merger, but not thereafter, either the Surviving Corporation or any former Fibrocell stockholder who has complied with the requirements of Section 262 of the DGCL, and who is otherwise entitled to appraisal rights, may commence an appraisal proceeding by filing a petition in the Delaware Court of Chancery demanding a determination of the fair value of the shares of Common Stock held by Fibrocell stockholders who have complied with the requirements of Section 262 of the DGCL and who are otherwise entitled to appraisal rights. A person who was the beneficial owner of shares of Common Stock held in a voting trust or by a nominee on behalf of such person may, in such person's own name, file the petition described in the previous sentence. Upon the filing of the petition by a former Fibrocell stockholder, service of a copy of such petition must be made upon Fibrocell, as the Surviving Corporation. The Surviving Corporation has no obligation to file such a petition if there are dissenting former Fibrocell stockholders. Accordingly, the failure of a former Fibrocell stockholder to file such a petition within the period specified could nullify the former Fibrocell stockholder's previously written demand for appraisal. There is no present intent on the part of Fibrocell to file an appraisal petition, and Fibrocell stockholders seeking to exercise appraisal rights should not assume that Fibrocell will file such a petition or that Fibrocell will initiate any negotiations with respect to the fair value of such shares. Accordingly, Fibrocell stockholders who desire to have their shares appraised should initiate any petitions necessary for the perfection of their appraisal rights within the time periods and in the manner prescribed in Section 262 of the DGCL.

        If a petition for appraisal is timely filed by a former Fibrocell stockholder and a copy of the petition is delivered to the Surviving Corporation, the Surviving Corporation will then be obligated, within 20 days after receiving service of a copy of the petition, to file with the Delaware Register in Chancery a duly verified list containing the names and addresses of all former Fibrocell stockholders who have demanded an appraisal of their shares, and with whom agreements as to the value of their shares have not been reached by the Surviving Corporation. After notice is made to dissenting former Fibrocell stockholders who demanded appraisal of their shares as required by the Delaware Court of Chancery, the Delaware Court of Chancery is empowered to conduct a hearing upon the petition to determine those former Fibrocell stockholders who have complied with Section 262 of the DGCL and who have become entitled to the appraisal rights thereunder. Under Delaware law, the Delaware Court of Chancery may require former stockholders who have demanded appraisal of their shares and who held stock represented by certificates to submit their stock certificates to the Delaware Register in Chancery for notation thereon of the pendency of the appraisal proceedings, and if any such former stockholder who held stock represented by certificates fails to comply with that direction, the Delaware Court of Chancery may dismiss the proceedings as to that former stockholder. The Delaware Court of Chancery shall dismiss the appraisal proceeding unless (a) the total number of shares entitled to appraisal exceeds 1% of the outstanding shares of Common Stock eligible for appraisal or (b) the value of the consideration provided in the Merger for such total number of shares of Common Stock exceeds $1 million.

        After the Delaware Court of Chancery determines which former Fibrocell stockholders are entitled to appraisal of their shares of Common Stock, the appraisal proceeding will be conducted in accordance with the rules of the Delaware Court of Chancery, including any rules specifically governing appraisal proceedings. Through such proceeding, the Delaware Court of Chancery will appraise the shares of Common Stock held by former Fibrocell stockholders who have complied with the

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requirements of Section 262 of the DGCL and who are otherwise entitled to appraisal rights, determining the fair value of the shares exclusive of any element of value arising from the accomplishment or expectation of the Merger, together with interest, if any, to be paid upon the amount determined to be the fair value (or, in certain circumstances described below, on the difference between the amount determined to be the fair value and the amount paid to each stockholder entitled to appraisal prior to the entry of judgment in the appraisal proceeding). Unless the Delaware Court of Chancery in its discretion determines otherwise for good cause shown, interest from the effective date of the Merger through the date of payment of the judgment will be compounded quarterly, and will accrue at 5% over the Federal Reserve discount rate (including any surcharge), as established from time to time during the period between the Effective Time of the Merger and the date of payment of the judgment. When the fair value is determined, the Delaware Court of Chancery will direct the payment of such value, with interest thereon accrued during the pendency of the proceeding, if the Delaware Court of Chancery so determines, to the former Fibrocell stockholders entitled to receive the same (in the case of shares represented by certificates, payment will not be made until such certificates are surrendered to the Surviving Corporation). At any time before the entry of judgment in the proceedings, the Surviving Corporation may pay to each former stockholder entitled to appraisal an amount in cash, in which case interest shall accrue thereafter only upon the sum of (1) the difference, if any, between the amount paid and the fair value of the shares as determined by the Delaware Court of Chancery, and (2) interest theretofore accrued, unless paid at that time.

        In determining fair value, and, if applicable, interest, the Delaware Court of Chancery is required to take into account all relevant factors. In Weinberger v. UOP,  Inc., the Delaware Supreme Court discussed the factors that could be considered in determining fair value in an appraisal proceeding, stating that "proof of value by any techniques or methods which are generally considered acceptable in the financial community and otherwise admissible in court" should be considered, and that "fair price obviously requires consideration of all relevant factors involving the value of a company."

        Section 262 of the DGCL provides that fair value is to be "exclusive of any element of value arising from the accomplishment or expectation of the Merger." In Cede & Co. v. Technicolor, Inc., the Delaware Supreme Court stated that such exclusion is a "narrow exclusion [that] does not encompass known elements of value," but which rather applies only to the speculative elements of value arising from such accomplishment or expectation. In Weinberger, the Delaware Supreme Court construed Section 262 of the DGCL to mean that "elements of future value, including the nature of the enterprise, which are known or susceptible of proof as of the date of the Merger and not the product of speculation, may be considered."

        You should be aware that the fair value of your shares of Common Stock as determined under Section 262 of the DGCL could be more than, the same as, or less than the value that you are entitled to receive under the terms of the Merger Agreement if you did not seek appraisal of your shares. Investment banking opinions as to the fairness from a financial point of view of the Merger Consideration are not necessarily opinions as to fair value under Section 262 of the DGCL.

        Costs of the appraisal proceeding may be imposed upon the Surviving Corporation and the former Fibrocell stockholders participating in the appraisal proceeding by the Delaware Court of Chancery as the Court deems equitable in the circumstances. Upon the application of a former Fibrocell stockholder, the Delaware Court of Chancery may order all or a portion of the expenses incurred by any former Fibrocell stockholder in connection with the appraisal proceeding, including, without limitation, reasonable attorneys' fees and the fees and expenses of experts, to be charged pro rata against the value of all shares entitled to appraisal. Any former Fibrocell stockholder who had demanded appraisal rights will not, after the Effective Time of the Merger, be entitled to vote shares subject to that demand for any purpose, or to receive payments of dividends or any other distribution with respect to those shares, other than with respect to payment as of a record date prior to the Effective Time of the Merger; however, if no petition for appraisal is filed within 120 days after the

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Effective Time of the Merger, or if the former Fibrocell stockholder delivers a written withdrawal of his, her or its demand for appraisal, and an acceptance of the terms of the Merger within 60 days after the Effective Time of the Merger (or thereafter with approval of the Surviving Corporation), then the right of that former Fibrocell stockholder to appraisal will cease and that former Fibrocell stockholder will be entitled to receive the cash payment for shares of his, her or its shares of Common Stock pursuant to the Merger Agreement. No appraisal proceeding in the Delaware Court of Chancery will be dismissed as to any former Fibrocell stockholder without the prior approval of the Court, and such approval may be conditioned upon such terms as the Delaware Court of Chancery deems just; provided, however, that any former Fibrocell stockholder who has not commenced an appraisal proceeding or joined that proceeding as a named party will maintain the right to withdraw its demand for appraisal, and to accept the cash that such holder would have received pursuant to the Merger Agreement within 60 days after the effective date of the Merger.

        In view of the complexity of Section 262 of the DGCL, Fibrocell stockholders who may wish to dissent from the Merger and pursue appraisal rights should consult their legal advisors. To the extent there are any inconsistencies between the foregoing summary and Section 262 of the DGCL, Section 262 of the DGCL will govern.

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PROPOSAL 2: APPROVAL OF ADVISORY (NON-BINDING) VOTE ON COMPENSATION

        Under Section 14A of the Exchange Act and the applicable SEC rules issued thereunder, we are required to submit a proposal to our stockholders for a non-binding, advisory vote to approve certain compensation that will or may be paid to our named executive officers in connection with the Merger. This proposal, which we refer to as the "Compensation Proposal," gives our stockholders the opportunity to vote, on a non-binding, advisory basis, on the compensation that may be paid or become payable to our named executive officers in connection with the Merger. This compensation is summarized in the table captioned "Golden Parachute Compensation" in the section entitled "The Merger—Interests of Directors and Executive Officers in the Merger" beginning on page 61, including the footnotes to the table.

        The Fibrocell Board encourages you to review carefully the named executive officer Merger-related compensation information disclosed in this proxy statement. The Fibrocell Board recommends that stockholders approve, by advisory vote, the compensation that will or may be paid to our named executive officers in connection with the Merger.

        The vote on the Compensation Proposal is a vote separate and apart from the vote on the Merger Proposal. Accordingly, you may vote to approve the Merger Proposal and vote not to approve the Compensation Proposal and vice versa. Because the vote on the Compensation Proposal is advisory only, it will not be binding on Fibrocell. Accordingly, if the Merger Agreement is adopted and the Merger is completed, the compensation will be payable, subject only to the conditions applicable thereto, regardless of the outcome of the vote on the Compensation Proposal.

        Approval of the Compensation Proposal requires the affirmative vote of the holders of a majority of the shares of Common Stock present in person or represented by proxy at the Special Meeting and entitled to vote thereon.

        If you fail to submit a proxy or fail to instruct your broker, bank, trust company or other nominee to vote, it will have no effect on the Compensation Proposal, assuming a quorum is present at the Special Meeting. If you mark your proxy to abstain or provide voting instructions to abstain, it will have the effect of a vote against the Compensation Proposal.

        The Fibrocell Board recommends that stockholders vote "FOR" the Compensation Proposal.

        If you return a properly executed proxy (including proxies received via the Internet or by telephone), but do not indicate instructions on your proxy, your shares of Common Stock represented by such proxy will be voted "FOR" the Compensation Proposal.


PROPOSAL 3: APPROVAL OF AUTHORITY TO ADJOURN THE SPECIAL MEETING

        Stockholders may be asked to vote on a proposal to approve one or more adjournments of the Special Meeting, if necessary or appropriate, to permit further solicitation of proxies if there are not sufficient votes at the time of the Special Meeting to adopt the Merger Agreement.

        Approval of the Adjournment Proposal requires the affirmative vote of the holders of a majority of the shares of Common Stock present in person or represented by proxy at the Special Meeting and entitled to vote thereon.

        If you fail to submit a proxy or fail to instruct your broker, bank, trust company or other nominee to vote, it will have no effect on the Adjournment Proposal, assuming a quorum is present at the Special Meeting. If you mark your proxy to abstain or provide voting instructions to abstain, it will have the effect of a vote against the Adjournment Proposal.

        The Fibrocell Board recommends that stockholders vote "FOR" the Adjournment Proposal.

        If you return a properly executed proxy (including proxies received via the Internet or by telephone) but do not indicate instructions on your proxy, your shares of Common Stock represented by such proxy will be voted "FOR" the Adjournment Proposal.

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SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

        The following table shows the number of shares of our Common Stock beneficially owned (as defined by the SEC for proxy statement purposes) as of October 1, 2019, by (i) each person known by Fibrocell to beneficially own more than 5% of Fibrocell's Common Stock, (ii) each of our directors, (iii) each of our named executive officers, and (iv) all of our directors and executive officers as a group. Unless otherwise noted, the persons listed in the table have sole voting and investment powers with respect to the shares of Common Stock owned by them.

Name of Beneficial Owner
  Common
Stock
Beneficially
Owned(1)
  Percent of
Class(2)
 

Named Executive Officers and Directors(11):

             

John M. Maslowski

    40,618 (3)   *  

Sean D. Buckley

    7,893 (4)   *  

Julian P. Kirk

    17,134 (4)   *  

Marc B. Mazur

    18,802 (5)   *  

Kelvin D. Moore

    17,972 (6)   *  

Marcus E. Smith

    17,134 (4)   *  

Christine St.Clare

    17,801 (7)   *  

Douglas J. Swirsky

    17,134 (4)   *  

All Current Executive Officers and Directors as a Group (8 persons)

    154,488 (8)   1.6 %

Greater Than 5% Stockholders:

   
 
   
 
 

Randal J. Kirk(9)

    2,198,939     21.3 %

Roger M. Klein(10)

    670,015     6.9 %

*
Represents less than 1% of the outstanding shares of our Common Stock.

(1)
Beneficial ownership is determined in accordance with Rule 13d-3 under the Exchange Act. A person or group is deemed to be the beneficial owner of any shares of our Common Stock over which such person or group has sole or shared voting or investment power, plus any shares which such person or group has the right to acquire beneficial ownership of within 60 days of October 1, 2019, whether through the exercise of options, warrants or otherwise. Unless otherwise indicated in the footnotes, each person or entity identified in the table has sole voting and investment power with respect to all shares shown as beneficially owned by them, subject to applicable community property laws.

(2)
The beneficial ownership percentage is calculated for each person or group separately because shares of our Common Stock subject to options, warrants or other rights to acquire our Common Stock that are currently exercisable or exercisable within 60 days of October 1, 2019 are considered outstanding and beneficially owned by the person or group holding such options, warrants or other rights but not for the purpose of calculating the percentage ownership of any other person or group. As a result, the beneficial ownership percentage for each person or group is calculated by dividing (x) the number of shares reported in the table as beneficially owned by such person or group, by (y) 9,758,332 shares (which represents the number of shares of our Common Stock that were outstanding as of October 1, 2019) plus the number of shares that such person or group has the right to acquire beneficial ownership of within 60 days of October 1, 2019 as indicated in the footnotes below.

(3)
Consists of (i) 3,164 shares of our Common Stock and (ii) options to purchase an aggregate of 37,454 shares of our Common Stock exercisable within 60 days of October 1, 2019.

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(4)
The share amounts set forth in the table consist solely of shares underlying options to purchase our Common Stock exercisable within 60 days of October 1, 2019.

(5)
Consists of (i) 600 shares of our Common Stock and (ii) options to purchase an aggregate of 18,202 shares of our Common Stock exercisable within 60 days of October 1, 2019.

(6)
Consists of (i) 304 shares of our Common Stock and (ii) options to purchase 17,668 shares of our Common Stock exercisable within 60 days of October 1, 2019.

(7)
Consists of (i) 667 shares of our Common Stock and (ii) options to purchase 17,134 shares of our Common Stock exercisable within 60 days of October 1, 2019.

(8)
Consists of (i) 4,735 shares of our Common Stock and (ii) options to purchase an aggregate of 149,753 shares of our Common Stock exercisable within 60 days of October 1, 2019.

(9)
Based on the Schedule 13D/A filed on December 11, 2017 (Schedule 13D/A) by Randal J. Kirk, Third Security, LLC (Third Security), NRM VII Holdings I, LLC (NRM VII Holdings), Kapital Joe, LLC (Kapital Joe), Mascara Kaboom, LLC (Mascara Kaboom) and Intrexon Corporation (Intrexon). According to the Schedule 13D/A, Randal J. Kirk has sole voting and investment power with respect to 1,772,220 shares and shared voting and investment power with respect to 426,719 shares of Common Stock held, in each case, by NRM VII Holdings, Kapital Joe, Mascara Kaboom and Intrexon.

According to Schedule 13D/As jointly filed by Mr. Kirk and his affiliated entities, the Convertible Notes, the shares of Preferred Stock and the warrants issued in a 2016 private placement and in March 2017 contain certain conversion and exercise restrictions. If NRM VII Holdings, Intrexon, Kapital Joe and Mascara Kaboom exercised our Common Stock purchase warrants and converted (x) the principal and accrued interest of our Convertible Notes and (y) the Preferred Stock held by each such entity, NRM VII Holdings, Intrexon, Kapital Joe and Mascara Kaboom would receive, in the aggregate, (i) 710,011 shares of our Common Stock pursuant to exercise of the warrants, (ii) 396,771 shares of Common Stock underlying $6,762,500 outstanding principal amount of Convertible Notes, (iii) 51,481 shares of Common Stock underlying an estimated $877,436 of accrued interest on the Convertible Notes and (iv) 286,520 shares of Common Stock underlying our Preferred Stock (inclusive of dividends through September 30, 2019 payable by way of inclusion in the stated value of the Preferred Stock), resulting in the beneficial ownership of approximately 31% of our Common Stock. NRM VII Holdings is managed by an affiliate that is managed by Third Security which is owned by Mr. Kirk. Kapital Joe and Mascara Kaboom are managed by Third Security. Mr. Kirk could be deemed to have indirect beneficial ownership of the shares of Common Stock directly beneficially owned by NRM VII Holdings, Intrexon, Kapital Joe and Mascara Kaboom. The address for Randal J. Kirk is c/o Third Security, 1881 Grove Avenue, Radford, Virginia 24141.

(10)
Based on the Schedule 13G filed by Roger M. Klein on September 25, 2019. The address for Mr. Klein is P.O. Box 610102, Newtown, MA 02461.

(11)
The address for each of our directors and named executive officers is c/o Fibrocell, 405 Eagleview Blvd, Exton, PA 19341.

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MARKET PRICE OF COMMON STOCK

        Our Common Stock is listed and traded on Nasdaq under the symbol "FCSC." As of the Record Date, Fibrocell had                shares of Common Stock issued and outstanding and Fibrocell had approximately            holders of record.

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STOCKHOLDER PROPOSALS

        We held our annual meeting on June 12, 2019. We intend to hold an annual meeting in 2020 only if the Merger is not completed. Proposals of stockholders pursuant to Rule 14a-8 of the Exchange Act that are intended to be presented at the 2020 annual meeting of stockholders, if such meeting is held, must be received by us at our executive offices at 405 Eagleview Boulevard, Exton, Pennsylvania 19341, on or before January 4, 2020 to be eligible for inclusion in our proxy statement and form of proxy relating to that meeting and to be introduced for action at the meeting.

        Our current bylaws require that, in order for proposals and director nominations of stockholders to be considered timely and eligible for consideration at the 2020 annual meeting of stockholders, such proposals must be submitted in accordance with the requirements of the bylaws, not later than January 4, 2020; provided, however, that in the event that the date of the 2020 Annual Meeting of Stockholders is changed by more than thirty (30) days from the anniversary date of the 2019 Annual Meeting of Stockholders, notice by the stockholder to be timely must be delivered not earlier than the close of business on the thirtieth day prior to the 2020 Annual Meeting of Stockholders; provided, that in the event that less than 40 days' notice of the date of the meeting is given to stockholders, to be timely, a stockholders' notice of business to be brought before the meeting shall be so received no later than the close of business of the tenth day following the day on which such notice of the date of the 2020 Annual Meeting of Stockholders was mailed. All stockholder proposals should be sent to the attention of our Corporate Secretary, c/o Fibrocell Science, Inc., 405 Eagleview Blvd., Exton, Pennsylvania 19341. The notice of the proposal also must comply with the content requirements for such notices set forth in our bylaws.

        For additional requirements, a stockholder may refer to our bylaws, a copy of which may be obtained from our Corporate Secretary. If we do not receive timely notice pursuant to our bylaws, the proposal or nomination may be excluded from consideration at the meeting.


HOUSEHOLDING

        The SEC has adopted rules that permit companies and intermediaries such as brokers to satisfy delivery requirements for proxy statements and annual reports with respect to two or more stockholders sharing the same address by delivering a single proxy statement or annual report, as applicable, addressed to those stockholders. This process, which is commonly referred to as "householding," potentially provides extra convenience for stockholders and cost savings for companies.

        If, at any time, you no longer wish to participate in householding and would prefer to receive a separate proxy statement, or if you are receiving multiple copies of this proxy statement and wish to receive only one, please contact Fibrocell at 405 Eagleview Blvd., Exton, PA 19341, attention of Corporate Secretary. Fibrocell will promptly deliver, upon oral or written request, a separate copy of this proxy statement to any stockholder residing at an address to which only one copy was mailed. Requests for additional copies should be directed to Fibrocell Science, Inc., at 405 Eagleview Blvd., Exton, Pa 19341, attention of Corporate Secretary or by telephone at (484) 713-6000.

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WHERE YOU CAN FIND MORE INFORMATION

        Fibrocell files annual, quarterly and current reports, proxy statements and other information with the SEC. The SEC also maintains an Internet website that contains reports, proxy and information statements, and other information regarding issuers, including Fibrocell, who file electronically with the SEC. The address of that site is www.sec.gov.

        The SEC allows us to "incorporate by reference" information into this proxy statement, which means that we can disclose important information to you by referring you to other documents filed separately with the SEC. The information incorporated by reference is deemed to be part of this proxy statement, except for any information superseded by information in this proxy statement or incorporated by reference subsequent to the date of this proxy statement. This proxy statement incorporates by reference the documents set forth below that we have previously filed with the SEC. These documents contain important information about us and our financial condition and are incorporated by reference into this proxy statement.

        The following Fibrocell filings with the SEC are incorporated by reference:

        We also incorporate by reference into this proxy statement each additional document we may file under Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act between the date of this proxy statement and the earlier of the date of the Special Meeting or the termination of the Merger Agreement. These documents include periodic reports, such as Annual Reports on Form 10-K and Quarterly Reports on Form 10-Q, as well as Current Reports on Form 8-K (other than current reports on Form 8-K furnished pursuant to Item 2.02 or Item 7.01 of Form 8-K, including any exhibits included with such information, unless otherwise indicated therein) and proxy solicitation materials. The information provided on our website is not part of this proxy statement, and therefore is not incorporated by reference herein.

        You may obtain any of the documents we file with the SEC, by requesting them in writing or by telephone from us at the following address: Fibrocell Science, Inc., 405 Eagleview Blvd., Exton, PA 19341, Attn: Corporate Secretary.

        If you are a stockholder of Fibrocell and would like to request documents, please do so by                                    , 2019, to receive them before the Special Meeting. If you request any documents from Fibrocell, we will mail them to you by first class mail, or another equally prompt means, within one business day after Fibrocell receives your request.

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        If you have any questions about this proxy statement, the Special Meeting or the Merger or need assistance with voting procedures, you should contact:

Okapi Partners LLC
1212 Avenue of the Americas, 24th Floor
New York, New York 10036
Banks and Brokerage Firms, Please Call: (212) 297-0720
Stockholders and All Others Call Toll-Free: (877) 259-6290
Email: info@okapipartners.com

        You should rely only on the information contained in this proxy statement. No persons have been authorized to give any information or to make any representations other than those contained in this proxy statement and, if given or made, such information or representations must not be relied upon as having been authorized by Fibrocell or any other person. Fibrocell has supplied all information contained in this proxy statement relating to Fibrocell and its affiliates. Castle Creek has supplied all information contained in this proxy statement relating to Castle Creek, Merger Sub and their affiliates.

        THIS PROXY STATEMENT DOES NOT CONSTITUTE THE SOLICITATION OF A PROXY IN ANY JURISDICTION TO OR FROM ANY PERSON TO WHOM OR FROM WHOM IT IS UNLAWFUL TO MAKE SUCH PROXY SOLICITATION IN THAT JURISDICTION. YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED IN THIS PROXY STATEMENT TO VOTE YOUR SHARES AT THE SPECIAL MEETING. THIS PROXY STATEMENT IS DATED            , 2019. YOU SHOULD NOT ASSUME THAT THE INFORMATION CONTAINED IN THIS PROXY STATEMENT IS ACCURATE AS OF ANY DATE OTHER THAN THAT DATE, AND THE MAILING OF THIS PROXY STATEMENT TO STOCKHOLDERS DOES NOT CREATE ANY IMPLICATION TO THE CONTRARY.

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Annex A

AGREEMENT AND PLAN OF MERGER

by and among

CASTLE CREEK PHARMACEUTICAL HOLDINGS, INC.,

CASTLE CREEK MERGER CORP.

and

FIBROCELL SCIENCE, INC.

Dated as of September 12, 2019


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TABLE OF CONTENTS

 
   
  Page  

ARTICLE I THE MERGER

    A-2  

1.1.

 

The Merger

   
A-2
 

1.2.

 

Closing and Effective Time of the Merger

    A-3  


ARTICLE II CONVERSION OF SECURITIES IN THE MERGER


 

 

A-3

 

2.1.

 

Conversion and Treatment of Securities

   
A-3
 

2.2.

 

Payment for Securities; Surrender of Certificates

    A-5  

2.3.

 

Dissenting Shares

    A-9  

2.4.

 

Treatment of Options

    A-10  

2.5.

 

Withholding Rights

    A-10  

2.6.

 

Certain Adjustments

    A-10  


ARTICLE III REPRESENTATIONS AND WARRANTIES OF THE COMPANY


 

 

A-11

 

3.1.

 

Corporate Organization

    A-11  

3.2.

 

Capitalization

    A-11  

3.3.

 

Authority; Execution and Delivery; Enforceability

    A-13  

3.4.

 

No Conflicts

    A-13  

3.5.

 

SEC Documents; Financial Statements; Undisclosed Liabilities

    A-14  

3.6.

 

Absence of Certain Changes or Events

    A-16  

3.7.

 

Information Supplied

    A-16  

3.8.

 

Legal Proceedings

    A-16  

3.9.

 

Compliance with Laws and Orders

    A-16  

3.10.

 

Permits

    A-17  

3.11.

 

Employee Benefit Plans

    A-17  

3.12.

 

Employee and Labor Matters

    A-20  

3.13.

 

Environmental Matters

    A-21  

3.14.

 

Real Property; Title to Assets

    A-22  

3.15.

 

Tax Matters

    A-22  

3.16.

 

Material Contracts

    A-24  

3.17.

 

Intellectual Property

    A-26  

3.18.

 

Regulatory Matters

    A-30  

3.19.

 

Broker's Fees

    A-32  

3.20.

 

Opinion of Financial Advisor

    A-32  

3.21.

 

Insurance

    A-32  

3.22.

 

Suppliers

    A-33  

3.23.

 

No Other Representations or Warranties

    A-33  


ARTICLE IV REPRESENTATIONS AND WARRANTIES OF PARENT AND MERGER SUB


 

 

A-33

 

4.1.

 

Corporate Organization

   
A-33
 

4.2.

 

Authority, Execution and Delivery; Enforceability

    A-34  

4.3.

 

No Conflicts

    A-34  

4.4.

 

Litigation

    A-34  

4.5.

 

Information Supplied

    A-35  

4.6.

 

Ownership of Company Capital Stock

    A-35  

4.7.

 

Available Funds

    A-35  

4.8.

 

Ownership of Merger Sub

    A-35  

4.9.

 

No Other Representations and Warranties

    A-36  

A-i


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  Page  


ARTICLE V COVENANTS


 

 

A-36

 

5.1.

 

Conduct of Business by the Company Pending the Closing

   
A-36
 

5.2.

 

Access to Information; Confidentiality

    A-39  

5.3.

 

No Solicitation

    A-40  

5.4.

 

SEC Filings; Other Actions

    A-43  

5.5.

 

Appropriate Action; Consents; Filings

    A-45  

5.6.

 

Certain Notices

    A-47  

5.7.

 

Public Announcements

    A-47  

5.8.

 

Employee Benefit Matters

    A-47  

5.9.

 

Indemnification

    A-49  

5.10.

 

Parent Agreements Concerning Merger Sub

    A-50  

5.11.

 

Takeover Statutes

    A-50  

5.12.

 

Section 16 Matters

    A-50  

5.13.

 

Stockholder Litigation

    A-50  

5.14.

 

Stock Exchange Delisting

    A-51  

5.15.

 

Regulatory Matters

    A-51  

5.16.

 

Financing

    A-51  

5.17.

 

Treatment of Additional Equity Interests

    A-53  


ARTICLE VI CONDITIONS TO CONSUMMATION OF THE MERGER


 

 

A-54

 

6.1.

 

Conditions to Obligations of Each Party Under This Agreement

   
A-54
 

6.2.

 

Conditions to Obligations of the Company Under This Agreement

    A-54  

6.3.

 

Conditions to Obligations of Parent and Merger Sub Under This Agreement

    A-54  


ARTICLE VII TERMINATION, AMENDMENT AND WAIVER


 

 

A-56

 

7.1.

 

Termination

   
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7.2.

 

Effect of Termination

    A-57  

7.3.

 

Company Termination Fee

    A-57  

7.4.

 

Parent Termination Fee

    A-58  

7.5.

 

Limitation on Recourse

    A-59  

7.6.

 

Amendment

    A-59  

7.7.

 

Waiver

    A-59  


ARTICLE VIII GENERAL PROVISIONS


 

 

A-60

 

8.1.

 

Non-Survival of Representations and Warranties

   
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8.2.

 

Fees and Expenses

    A-60  

8.3.

 

Notices

    A-60  

8.4.

 

Certain Definitions

    A-61  

8.5.

 

Terms Defined Elsewhere

    A-67  

8.6.

 

Headings

    A-69  

8.7.

 

Severability

    A-69  

8.8.

 

Entire Agreement

    A-70  

8.9.

 

Assignment

    A-70  

8.10.

 

No Third Party Beneficiaries

    A-70  

8.11.

 

Mutual Drafting; Interpretation

    A-70  

8.12.

 

Governing Law; Consent to Jurisdiction; Waiver of Trial by Jury

    A-70  

8.13.

 

Counterparts

    A-71  

8.14.

 

Specific Performance

    A-71  

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8.15.

 

Non-Recourse Against Financing Sources

    A-72  

Exhibit A-1

 

Form of Equity Commitment Letter (Valor)

Exhibit A-2

 

Form of Equity Commitment Letter (Marshman)

Exhibit B

 

Form of Certificate of Incorporation of Surviving Corporation

Exhibit C

 

Form of Bylaws of Surviving Corporation

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AGREEMENT AND PLAN OF MERGER

        This AGREEMENT AND PLAN OF MERGER, dated as of September 12, 2019 (this "Agreement"), is made by and among Castle Creek Pharmaceutical Holdings, Inc., a Delaware corporation ("Parent"), Castle Creek Merger Corp., a Delaware corporation and a wholly owned subsidiary of Parent ("Merger Sub"), and Fibrocell Science, Inc., a Delaware corporation (the "Company"). All capitalized terms used in this Agreement shall have the meanings assigned to such terms in Section 8.4 or as otherwise defined elsewhere in this Agreement unless the context clearly indicates otherwise.


RECITALS

        WHEREAS, the Company, Parent and Merger Sub desire to effect the merger of Merger Sub with and into the Company, with the Company continuing as the surviving corporation (the "Merger") on the terms and subject to the conditions set forth in this Agreement and in accordance with the General Corporation Law of the State of Delaware, as amended (the "DGCL");

        WHEREAS, the Board of Directors of Merger Sub has, upon the terms and subject to the conditions set forth herein, approved and declared it advisable for Merger Sub to enter into this Agreement and consummate the transactions contemplated hereby, including the Merger;

        WHEREAS, the Board of Directors of Parent has, upon the terms and subject to the conditions set forth herein, approved this Agreement and the transactions contemplated hereby, including the Merger, and Parent, as the sole stockholder of Merger Sub, has duly executed and delivered to Merger Sub and the Company a written consent, to be effective by its terms immediately following execution of this Agreement, adopting this Agreement;

        WHEREAS, the Board of Directors of the Company (the "Company Board") has established a special committee thereof consisting only of independent and disinterested directors (the "Transaction Committee") to, among other things, consider, review, evaluate and negotiate this Agreement and the transactions contemplated hereby;

        WHEREAS, the Transaction Committee has, by a unanimous vote of all its members, (i) approved and declared advisable this Agreement and the transactions contemplated hereby, including the Merger, (ii) determined that the terms of this Agreement and the Merger are fair to, and in the best interests of, the Company and its stockholders, and (iii) recommended to the Company Board the approval of this Agreement and the transactions contemplated hereby, including the Merger;

        WHEREAS, upon the receipt of recommendation from the Transaction Committee, the Company Board has, upon the terms and subject to the conditions set forth herein, (i) approved and declared advisable this Agreement and the transactions contemplated hereby, including the Merger, (ii) determined that the terms of this Agreement and the Merger are fair to, and in the best interests of, the Company and its stockholders, (iii) directed that this Agreement be submitted to the stockholders of the Company at the Company Meeting, and (iv) recommended that the Company's stockholders adopt this Agreement in accordance with the DGCL and other applicable Law;

        WHEREAS, concurrently with the execution and delivery of this Agreement, and as a condition to the willingness of the Company to enter into this Agreement, Valor Equity Partners IV L.P. and Marshman Fund Trust II U/A/D 5/1/08 (the "Equity Financers" and each an "Equity Financer") are entering into equity commitment letters, copies of which are attached as Exhibit A-1 and Exhibit A-2 hereto (the "Equity Commitment Letters", and each an "Equity Commitment Letter"), pursuant to which each Equity Financer will provide equity or debt financing to Parent and Merger Sub on the terms and conditions set forth therein;

        WHEREAS, as a condition to and inducement to Parent's and Merger Sub's willingness to enter into this Agreement, simultaneously with the execution of this Agreement, each of MSD Credit Opportunity Master Fund, L.P., NRM VII Holdings I, LLC, Intrexon Corporation, Kapital Joe, LLC


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and Mascara Kaboom, LLC are entering into support agreements with Parent and Merger Sub (the "Support Agreements"); and

        WHEREAS, Parent, Merger Sub and the Company desire to make certain representations, warranties, covenants and agreements in connection with the Merger and also to prescribe various conditions to the Merger.


AGREEMENT

        NOW, THEREFORE, in consideration of the foregoing, and the covenants, premises, representations and warranties and agreements contained in this Agreement and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, and intending to be legally bound, the parties to this Agreement agree as follows:


ARTICLE I
THE MERGER

        1.1.    The Merger.     

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        1.2.
    Closing and Effective Time of the Merger.     The closing of the Merger (the "Closing") will take place at 8:00 a.m., local time, on the third Business Day after satisfaction or waiver of all of the applicable conditions set forth in ARTICLE VI (other than those conditions that by their nature are to be satisfied at the Closing, but subject to the fulfillment or waiver of those conditions at the Closing), at the offices of Latham & Watkins LLP, 330 North Wabash Avenue, Chicago, IL 60611, unless another time, date or place is agreed to in writing by the parties hereto. The date on which the Closing is to occur pursuant to this Section 1.2 is referred to as the "Closing Date". On the Closing Date, or on such other date as Parent and the Company may agree to, the Company shall cause a certificate of merger (the "Certificate of Merger"), to be executed and filed with the Secretary of State of the State of Delaware in accordance with the relevant provisions of the DGCL and shall make all other filings required under the DGCL. The Merger shall become effective at the time the Certificate of Merger shall have been duly filed with the Secretary of State of the State of Delaware, or such later date and time as is agreed upon by the parties and specified in the Certificate of Merger (such date and time hereinafter referred to as the "Effective Time").


ARTICLE II
CONVERSION OF SECURITIES IN THE MERGER

        2.1.    Conversion and Treatment of Securities.     

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        2.2.
    Payment for Securities; Surrender of Certificates.     


        (b)
    Procedures for Surrender.     

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        (c)
    Transfer Books; No Further Ownership Rights in Shares.     At the Effective Time, the stock transfer books of the Company with respect to the Company Shares shall be closed and thereafter there shall be no further registration of transfers of Company Shares on the records of the Company. From and after the Effective Time, the holders of Certificates and Book-Entry Company Shares that represented ownership of Company Shares outstanding immediately prior to the Effective Time shall cease to have any rights with respect to such Company Shares except as otherwise provided for herein or by applicable Law. If, after the Effective Time, Certificates are presented to the Surviving Corporation for any reason, they shall be cancelled and exchanged as provided in this Agreement.


        (d)
    Termination of Fund; Abandoned Property; No Liability.     Any portion of the funds in the Exchange Fund (including any interest received with respect thereto) made available to the Paying Agent that remains unclaimed by the holders of Certificates, Book-Entry Company Shares, shares of Preferred Stock or Company Warrants on the six month anniversary of the Effective Time will be returned to the Surviving Corporation or an affiliate thereof designated by the Surviving Corporation, upon demand, and any such holder who has not tendered its Certificates or Book-Entry Company Shares for the Merger Consideration, its Notice of Conversion in exchange for the Conversion Amount, or its Repurchase Notice or Notice of Exercise, in each case in accordance with Section 2.2(b), prior to such time shall thereafter look only to the Surviving Corporation (subject to abandoned property, escheat or other similar Laws) for delivery of the Merger Consideration, Conversion Amount, Warrant Consideration or Black-Scholes Value, without interest and subject to any withholding of Taxes required by applicable Law or the terms of such Equity Interest, in respect of such holder's surrender of their Certificates or Book-Entry Company Shares or delivery of their Notice of Exercise or Notice of Conversion and compliance with the procedures in Section 2.2(b). Any Merger Consideration remaining

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unclaimed by the holders of Certificates or Book-Entry Company Shares immediately prior to such time as such amounts would otherwise escheat to, or become property of, any Governmental Entity will, to the extent permitted by applicable Law, become the property of the Surviving Corporation or an affiliate thereof designated by the Surviving Corporation, free and clear of any claim or interest of any Person previously entitled thereto. Holders of shares of Preferred Stock may deliver a Notice of Conversion in exchange for the Conversion Amount at any time following the Effective Time. Holders of Common Warrants or Black-Scholes Warrants may deliver a Repurchase Notice to the Surviving Corporation at any time within 30 days following the Warrant Repurchase Date, and any Repurchase Notice received after such date shall be invalid and the holder of the Company Warrant in respect of such Repurchase Notice shall not be entitled to the Black-Scholes Value. Holders of the Common Warrants that do not otherwise deliver a Repurchase Notice shall be entitled to the Warrant Consideration upon delivery of a Notice of Exercise and compliance with the procedures in Section 2.2(b)(iv) until the expiry of such Common Warrants in accordance with their terms. Notwithstanding the foregoing, none of Parent, Merger Sub, the Surviving Corporation, the Paying Agent or their respective affiliates will be liable to any holder of a Certificate or Book-Entry Company Shares for Merger Consideration delivered to a public official pursuant to any applicable abandoned property, escheat or similar Law. Any portion of the Merger Consideration made available to the Paying Agent pursuant to Section 2.2(a), to pay for Company Shares for which appraisal rights have been perfected shall be returned to the Surviving Corporation, upon demand.


        (e)
    Lost, Stolen or Destroyed Certificates.     In the event that any Certificates shall have been lost, stolen or destroyed, the Paying Agent shall issue in exchange for such lost, stolen or destroyed Certificates, upon the making of an affidavit of that fact by the person claiming such Certificates to be lost, stolen or destroyed, the Merger Consideration, payable in respect thereof pursuant to Section 2.1(a) . Parent may, in its reasonable discretion and as a condition precedent to the payment of such Merger Consideration, require the owners of such lost, stolen or destroyed Certificates to deliver a bond in a reasonable sum as it may reasonably direct as indemnity against any claim that may be made against Parent, Merger Sub, the Surviving Corporation or the Paying Agent with respect to the Certificates alleged to have been lost, stolen or destroyed.


        2.3.
    Dissenting Shares.     Notwithstanding anything in this Agreement to the contrary (but subject to the provisions of this Section 2.3), Company Shares and shares of Preferred Stock outstanding immediately prior to the Effective Time and held by a holder who did not vote in favor of the adoption of this Agreement with respect to such shares, and who is entitled to demand and has properly demanded appraisal for such Company Shares or shares of Preferred Stock in accordance with, and who complies in all respects with, Section 262 of the DGCL (such Company Shares, the "Dissenting Shares") shall not be converted into the right to receive the Merger Consideration. At the Effective Time, all Dissenting Shares shall no longer be outstanding and shall automatically be cancelled and cease to exist, and the holders of Dissenting Shares shall cease to have any rights with respect thereto, except the rights granted to them under Section 262 of the DGCL. If any such holder fails to perfect or otherwise waives, withdraws or loses his right to appraisal under Section 262 of the DGCL or other applicable Law, then the right of such holder to be paid the fair value of such Dissenting Shares shall cease and such Dissenting Shares shall thereupon be deemed to have been converted, as of the Effective Time, into and shall be exchangeable solely for the right to receive the Merger Consideration, without interest and subject to any withholding of Taxes required by applicable Law in accordance with this ARTICLE II and shall not thereafter be deemed to be Dissenting Shares. The Company shall give Parent prompt notice of any demands received by the Company for appraisal of Company Shares and any other instruments served pursuant to the DGCL and received by the Company relating to rights to be paid the fair value of Dissenting Shares, and Parent shall have the right to participate in and control all negotiations and proceedings with respect to such demands. Prior to the Effective Time, the Company shall not, except with the prior written consent of Parent, make any payment with respect to,

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or settle or compromise, any such demands, or approve any withdrawal of any such demands, or agree to do any of the foregoing, except to the extent required by applicable Law.


        2.4.
    Treatment of Options.     


        (a)
    Treatment of Options.     At the Effective Time, (i) each option to purchase Company Shares (each a "Company Option") granted under the Fibrocell Science, Inc. 2009 Equity Incentive Plan (the "2009 Plan"), whether vested or unvested, and (ii) each Company Option granted under the Fibrocell Science, Inc. 2019 Equity Incentive Plan (the "2019 Plan"), whether vested or unvested, in each case, that is outstanding and unexercised immediately prior to the Effective Time (each, an "Eligible Company Option") shall automatically and without any required action on the part of the holder thereof, be cancelled and shall only entitle the holder of such Eligible Company Option to receive an amount equal to (i) the Merger Consideration minus the exercise price per Company Share subject to such Eligible Company Option, multiplied by (ii) the number of Company Shares subject to such Eligible Company Option, payable in accordance with Section 2.1, less applicable Taxes required to be withheld pursuant to Section 2.5; provided that, if the exercise price per Company Share subject to an Eligible Company Option is equal to or greater than the Merger Consideration, such Eligible Company Option shall be cancelled for no consideration.


        (b)
    Termination of Company Equity Plans.     As of the Effective Time, the 2009 Plan and the 2019 Plan (each, a "Company Equity Plan" and, collectively, the "Company Equity Plans") shall be terminated and no further Company Shares, Company Options, Equity Interests or other rights with respect to Company Shares shall be granted thereunder.


        (c)
    Board Actions.     Prior to the Effective Time, the Company Board (upon the unanimous recommendation of the Transaction Committee) shall adopt appropriate resolutions and take such other actions as are reasonably necessary and appropriate (including using reasonable best efforts to obtain any required consents) to effect the transactions described in this Section 2.4.


        2.5.
    Withholding Rights.     The Company, Parent, Merger Sub, the Surviving Corporation and the Paying Agent, as the case may be, shall be entitled to deduct and withhold from any amounts otherwise payable pursuant to this Agreement (except as otherwise set forth in the Certificate of Designations or a Company Warrant, as applicable), such amounts as are required to be deducted and withheld with respect to the making of such payment under the Code, the Treasury Regulations or any other provision of applicable Law. To the extent that amounts are so deducted or withheld, such amounts shall be treated for all purposes of this Agreement as having been paid to the Person in respect of which such deduction or withholding was made.


        2.6.
    Certain Adjustments.     In the event that, between the date of this Agreement and the Effective Time, any change in the outstanding Company Shares, Preferred Stock or Company Warrants shall occur as a result of any stock split, reverse stock split, stock dividend (including any dividend or distribution of Equity Interests convertible into or exchangeable for Company Shares), recapitalization, reclassification, combination, exchange of shares or other similar event, the Merger Consideration, Conversion Amount or Warrant Consideration, as applicable, shall be equitably adjusted to reflect such event and to provide to holders of Company Shares, shares of Preferred Stock and Company Warrants the same economic effect as contemplated by this Agreement prior to such event; provided that nothing in this Section 2.6 shall be deemed to permit or authorize the Company to take any such action or effect any such change that it is not otherwise authorized or permitted to take pursuant to this Agreement (including Section 5.1).

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ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE COMPANY

        Except (a) as set forth in the disclosure schedule delivered by the Company to Parent and Merger Sub (the "Company Disclosure Schedule") prior to the execution of this Agreement (with specific reference to the representations and warranties in this ARTICLE III to which the information in such schedule relates; provided that, disclosure in the Company Disclosure Schedule as to a specific representation or warranty shall qualify any other sections of this Agreement to the extent (notwithstanding the absence of a specific cross reference) it is reasonably apparent on its face that such disclosure relates to such other sections), and (b) as disclosed in the Company SEC Documents filed since January 1, 2019 and publicly available at least two (2) Business Days prior to the execution and delivery of this Agreement (other than any disclosures contained in the "Forward Looking Statements" or "Risk Factors" sections of such Company SEC Documents, and any other disclosures contained in such Company SEC Documents that are predictive, cautionary or forward-looking in nature); provided that, the foregoing clause (b) shall not be applicable to Section 3.2 or Section 3.4, the Company hereby represents and warrants to Parent and Merger Sub as follows:


        3.1.
    Corporate Organization.     Each of the Company and its Subsidiaries is a corporation or other entity duly organized, validly existing and, to the extent applicable, in good standing under the Laws of the jurisdiction of its organization and has the requisite corporate or other entity power and authority to own or lease all of its properties and assets and to carry on its business as it is now being conducted. Each of the Company and its Subsidiaries is duly licensed or qualified to do business in each jurisdiction in which the nature of the business conducted by it or the character or location of the properties and assets owned or leased by it makes such licensing or qualification necessary, except where the failure to be so licensed or qualified, has not had and would not reasonably be expected to have a Company Material Adverse Effect. The copies of the Company Charter, Certificate of Designations and the Company Bylaws, as most recently filed with the Company SEC Documents, are true, complete and correct copies of such documents as in effect as of the date of this Agreement. The Company is not in violation of any of the provisions of the Company Charter, Certificate of Designations or the Company Bylaws.


        3.2.
    Capitalization.     

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        3.3.
    Authority; Execution and Delivery; Enforceability.     


        3.4.
    No Conflicts.     

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        3.5.
    SEC Documents; Financial Statements; Undisclosed Liabilities.     

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        3.6.
    Absence of Certain Changes or Events.     Since January 1, 2019 through the date of this Agreement, (a) except with respect to the Company, entry into this Agreement, the Merger or the Transactions or as expressly contemplated, the Company and its Subsidiaries have conducted their businesses in all material respects only in the ordinary course and in a manner consistent with past practice and (b) there has not been any change, event, development, condition or occurrence that has had or would reasonably be expected to have a Company Material Adverse Effect. Since January 1, 2019 through the date of this Agreement, neither the Company nor any of its Subsidiaries has taken any action that would have constituted a breach of, or required Parent's consent pursuant to, Sections 5.1(c), (d), (g)-(k), (m)-(p), (t) and (u) had the covenants therein applied since January 1, 2019.


        3.7.
    Information Supplied.     None of the information supplied or to be supplied by the Company for inclusion or incorporation by reference in the Proxy Statement will, at the date that the Proxy Statement or any amendment or supplement thereto is first mailed to holders of Company Shares and at the time of the Company Meeting, contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in light of the circumstances in which they are made, not misleading (except that no representation or warranty is made by the Company to such portions of the Proxy Statement that relate to Parent and its Subsidiaries, including Merger Sub, or to statements made therein based on information supplied by or on behalf of Parent for inclusion or incorporation by reference therein). The Proxy Statement will comply as to form in all material respects with the requirements of the Exchange Act.


        3.8.
    Legal Proceedings.     Except as, individually or in the aggregate, has not had and would not reasonably be expected to have a Company Material Adverse Effect, (a) there are no Proceedings pending, or to the Knowledge of the Company, threatened against the Company or any of its Subsidiaries or any of their respective assets or properties or any of the officers or directors of the Company (in their capacity as such) and (b) neither the Company nor any of its Subsidiaries nor any of their respective assets or properties is or are subject to any Order.


        3.9.
    Compliance with Laws and Orders.     The Company and its Subsidiaries are, and since January 1, 2017 have been, in compliance in all material respects with all Laws, Orders and NASDAQ rules and regulations applicable to the Company or any of its Subsidiaries or any assets owned or used by any of them. Neither the Company nor any of its Subsidiaries has received any written communication since January 1, 2017 from a Governmental Entity or NASDAQ that alleges that the Company or any of its Subsidiaries is in material violation of any such Law, Order or NASDAQ rule. During the past five (5) years, neither the Company nor any of its Subsidiaries, nor, 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, any of them, (i) used any corporate funds for any unlawful contribution, gift, entertainment or other unlawful

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expenses relating to political activity; (ii) made any direct or indirect unlawful payment to any foreign or domestic government official or employee from corporate funds; (iii) violated any provision of any applicable Anti-corruption Laws; or (iv) made any unlawful bribe, rebate, payoff, influence payment, kickback or other unlawful payment to any foreign or domestic government official or employee. During the past five (5) years, neither the Company nor any of its Subsidiaries has received any written communication from a Governmental Entity (x) related to any investigation or inquiry with respect to a potential violation by the Company or any of its Subsidiaries or any Representative thereof of any Anti-corruption Laws, or (y) that alleges that the Company or any of its Subsidiaries or any Representative thereof is in violation of any Anti-corruption Laws. During the past five (5) years, neither the Company nor any of its Subsidiaries has had a customer or supplier or other business relationship with, is a party to any Contract with, or has engaged in any transaction with, any Person (i) that is located, organized or domiciled in or that is a citizen of Cuba, Iran, North Korea, Sudan, Syria or the Crimea Region of Ukraine (including any Governmental Entity within such country or territory) or (ii) that is the target of any international economic or trade sanction administered or enforced by the Office of Foreign Assets Control of the United States Department of the Treasury ("OFAC"), the United Nations Security Council, the European Union, Her Majesty's Treasury, the United Kingdom Export Control Organization or other relevant sanctions authority (including but not limited to being listed on the Specially Designated Nationals and Blocked Persons List administered by OFAC).


        3.10.
    Permits.     The Company and each of its Subsidiaries have all governmental licenses, permits, certificates, certifications, approvals, clearances, consents, franchises, registrations, billing, exemptions and authorizations ("Permits") necessary for the conduct of their business and the use of their properties and assets, as presently conducted and used, and each of the Permits is valid, subsisting and in full force and effect, except where the failure to have or maintain such Permit has not had and would not reasonably be expected to, individually or in the aggregate, (a) result in a material liability to the Company and its Subsidiaries, taken as a whole, or materially impair the business or operation of the Company and its Subsidiaries or (b) have a material adverse effect on the ability of the Company to timely perform its obligations hereunder or under the other Transaction documents to which it is a party or consummate the Transactions. The operation of the Company and its Subsidiaries as currently conducted is not, and has not been since January 1, 2017, in violation of, nor is the Company or its Subsidiaries in default or violation under, any Permit, and, to the Knowledge of the Company, no event has occurred which, with notice or the lapse of time or both, would constitute a default or violation of any term, condition or provision of any Permit, except where such default or violation of such Permit has not had and would not reasonably be expected to, individually or in the aggregate, (a) result in material liability to the Company and its Subsidiaries, taken as a whole, or materially impair the business or operation of the Company and its Subsidiaries or (b) have a material adverse effect on the ability of the Company to timely perform its obligations hereunder or under the other Transaction documents to which it is a party or consummate the Transactions. There are no actions pending or, to the Knowledge of the Company, threatened, that seek the revocation, cancellation or modification of any Permit, except where such revocation, cancellation or modification has not had and would not reasonably be expected to, individually or in the aggregate, (a) result in a material liability to the Company and its Subsidiaries, taken as a whole, or materially impair the business or operation of the Company and its Subsidiaries or (b) have a material adverse effect on the ability of the Company to timely perform its obligations hereunder or under the other Transaction documents to which it is a party or consummate the Transactions.


        3.11.
    Employee Benefit Plans.     

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        3.12.
    Employee and Labor Matters.     

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        3.13.
    Environmental Matters.     

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        3.14.    Real Property; Title to Assets.     


        3.15.
    Tax Matters.     

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        3.16.
    Material Contracts.     

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        3.17.
    Intellectual Property.     

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        3.18.
    Regulatory Matters.     

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        3.19.
    Broker's Fees.     Except for the Company's obligations to Canaccord Genuity LLC, neither the Company nor any of its Subsidiaries nor any of their respective officers or directors on behalf of the Company or such Subsidiaries has employed any financial advisor, broker or finder or incurred any liability for any financial advisory, broker's fees, commissions or finder's fees in connection with any of the Transactions.


        3.20.
    Opinion of Financial Advisor.     Canaccord Genuity LLC, the Company's financial advisor, has delivered to the Transaction Committee and the Company Board its opinion in writing or orally, in which case, such opinion will be subsequently confirmed in writing, to the effect that, as of the date thereof and based upon and subject to the factors, procedures, qualifications, limitations and assumptions set forth therein, the consideration to be received by the holders of Company Shares (other than Parent, Merger Sub, the Company and their respective direct or indirect wholly-owned subsidiaries or holders of Dissenting Shares) pursuant to this Agreement is fair, from a financial point of view, to such holders.


        3.21.
    Insurance.     Except as would not reasonably be expected to have a Company Material Adverse Effect, (a) the Company and its Subsidiaries maintain insurance of a scope and coverage as is sufficient to comply with applicable Law as is customary in all material respects for businesses in the Company's and its Subsidiaries' businesses, (b) all insurance policies of the Company and its Subsidiaries are in full force and effect, and all premiums due and payable thereon have been paid and (c) neither the Company nor any of its Subsidiaries is in breach of, or default under, any such insurance policy or has taken any action or failed to take any action which, with notice or lapse of time or both, would constitute such a breach or default or permit termination or modification of any of the insurance policies. Since January 1, 2019, neither the Company nor any of its Subsidiaries has received any written notice of cancellation. Since January 1, 2017, neither the Company nor any of its

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Subsidiaries has received any written notice of invalidation or termination, or as of the date of this Agreement, denial of coverage, rejection of a material claim or material adjustment in the amount of premiums payable under any material insurance policy maintained by the Company or any of its Subsidiaries.


        3.22.
    Suppliers.     Section 3.22 of the Company Disclosure Schedule sets forth a list showing the ten (10) largest suppliers of the Company and its Subsidiaries, taken as a whole, determined by gross expenditures, during the twelve (12) month period ending on August 27, 2019 (each, a "Significant Supplier"). As used in this Section 3.22, the term "supplier" shall mean a supplier of goods or materials to, or a provider of services necessary for the conduct of the business of, the Company and its Subsidiaries. Since January 1, 2019, no Significant Supplier has indicated in writing an intention to (i) terminate its relationship with, or otherwise stop or materially reduce its supply of the Company or any of its Subsidiaries, as applicable, or (ii) materially change the terms and conditions on which it is prepared to supply the Company or such Subsidiary of the Company, as applicable, in a manner adverse to the Company or its Subsidiaries as applicable.


        3.23.
    No Other Representations or Warranties.     Except for the representations and warranties expressly set forth in this ARTICLE III or the Company Disclosure Schedule, none of the Company, any of its affiliates or any other Person on behalf of the Company makes any express or implied representation or warranty (and there is and has been no reliance by Parent, Merger Sub or any of their respective affiliates or Representatives on any such representation or warranty) with respect to the Company, its Subsidiaries or their respective businesses or with respect to any other information provided, or made available, to Parent, Merger Sub or their respective Representatives or affiliates in connection with the transactions contemplated hereby, including the accuracy or completeness thereof. Without limiting the foregoing, neither the Company nor any other Person will have or be subject to any liability or other obligation to Parent, Merger Sub or their Representatives or affiliates or any other Person resulting from Parent's, Merger Sub's or their Representatives' or affiliates' use of any information, documents, projections, forecasts or other material made available to Parent, Merger Sub or their Representatives or affiliates, including any information made available in the electronic data room maintained by the Company for purposes of the transactions contemplated by this Agreement, teaser, marketing material, confidential information memorandum, management presentations, functional "break-out"