CALADRIUS BIOSCIENCES, INC. (NASDAQ:CLBS) Files An 8-K Entry into a Material Definitive Agreement

Item1.01 Entry into a Material Definitive Agreement.

Interest Purchase Agreement with Hitachi Chemical Co. America,
Ltd.

On March 16, 2017 (the Effective Date), Caladrius BioSciences,
Inc. (Caladrius) entered into an interest purchase agreement (the
Purchase Agreement) with PCT LLC, a Caladrius Company, a majority
owned subsidiary of Caladrius (PCT), and Hitachi Chemical Co.
America, Ltd. (Hitachi), to which Hitachi has agreed to acquire
the 80.1% membership interest in PCT that it does not already own
from Caladrius for $75.0 million in cash (the Sale), subject to
potential adjustment, including based on PCTs cash and
outstanding indebtedness as of the closing of the Sale and a
potential future milestone payment (the Purchase Price). to the
terms of the Purchase Agreement, at the Effective Date, Hitachi
will pay Caladrius $5.0 million of the Purchase Price (the
Initial Payment). At the closing of the Sale (the Closing), an
additional $5.0 million of the Purchase Price will be deposited
into an escrow account to cover potential indemnification claims
of Hitachi, if any. As discussed below, the Closing is subject to
customary closing conditions, including approval of Caladrius
stockholders, and is expected to occur during the second quarter
of 2017. However, we cannot provide assurance as to when the Sale
will be completed, or whether it will be completed at all.

As part of the Purchase Price, Hitachi will pay Caladrius $5.0
million (the Milestone Payment) if PCT achieves $125 million in
Cumulative Revenue (excluding clinical service reimbursables)
(the Milestone) for the period from January 1, 2017 through
December 31, 2018 (the Milestone Period). For purposes of the
Milestone, Cumulative Revenue will be calculated based on PCTs
revenue from all customers (including Caladrius and its
subsidiaries) in accordance with the financial accounting and
reporting standards set forth in the statements and
pronouncements of the Financial Accounting Standards Board,
consistently applied.

The Purchase Agreement and the Sale have been approved by the
board of directors of Caladrius (the Caladrius Board). Director
Robert A. Preti recused himself from all deliberations relating
to the Sale due to his interests in the transaction, including
his entry into the retention agreement discussed below and his
entering into an employment agreement with PCT and Hitachi that
will be effective upon the Closing.

The Purchase Agreement requires Caladrius to cause to be filed
with the Securities and Exchange Commission (the
SEC) as promptly as practicable
following the Effective Date, a proxy statement (together with
any amendments thereof or supplements thereto, the
Proxy Statement) relating to the
stockholders meeting (the Stockholders
Meeting) at which Caladrius stockholders will vote
on, among other things, a proposal to adopt the Purchase
Agreement (the Sale Proposal).

Caladrius and PCT have made customary representations and
warranties in the Purchase Agreement and have agreed to customary
covenants, including covenants regarding the operation of the PCT
business prior to the closing. In addition, Caladrius and PCT
have agreed to covenants prohibiting them and their
representatives from soliciting, providing information or
entering into discussions concerning competing proposals to the
Sale, except in limited circumstances relating to unsolicited
proposals where the Caladrius Board determines in good faith,
after consultation with its outside financial and outside legal
counsel, that the failure to take such action would be
inconsistent with the Caladrius Boards fiduciary duties under
applicable law.

Except as permitted under the terms of the Purchase Agreement,
the Caladrius Board may not fail to make, withdraw, change,
modify or condition, in a manner adverse to Hitachi, its
recommendation that Caladrius stockholders approve the Sale (a
Caladrius Adverse Recommendation
Change). However, the Purchase Agreement provides
that, if the Caladrius Board determines that a competing proposal
constitutes a Superior Proposal (as such term is defined in the
Purchase Agreement) and that the failure to effect a Caladrius
Adverse Recommendation Change would be inconsistent with the
Caladrius Boards fiduciary duties under applicable law, then, the
Caladrius Board may effect a Caladrius Adverse Recommendation
Change. However, subject to limited exceptions, Caladrius may not
terminate the Purchase Agreement and enter into an agreement with
a third party making a Superior Proposal until after Caladrius
stockholders vote on the Sale Proposal and the Purchase Agreement
is terminated.

The consummation of the Sale is subject to certain conditions,
including: (i) approval of the Sale Proposal by Caladrius
stockholders (Caladrius Stockholder Approval); (ii) the execution
of a loan payoff letter by Oxford Finance LLC; (iii) receipt of
certain third party consents, waivers and approvals; and (iv)
certain other customary closing conditions.

In addition, the Purchase Agreement contains customary
indemnification provisions for certain losses incurred by Hitachi
as a result of, among other things, failures of representations
and warranties made by Caladrius or PCT or the failure of
Caladrius or PCT to perform covenants under the Purchase
Agreement as well as certain other liabilities.

The Purchase Agreement also provides that for a period of seven
years following the Closing, Caladrius will be entitled to
procure products and services from PCT at pricing equal to
Manufacturing Cost (as such term is defined in the Purchase
Agreement) for such products and services plus 5%, in connection
with Caladrius development of T-regulatory cell platforms.

The Purchase Agreement may be terminated under the circumstances
set forth in the Purchase Agreement. If the Purchase Agreement is
terminated under certain circumstances, Caladrius must return the
Initial Payment within 90 days; if it does not, Hitachis
ownership in PCT will increase to 26.06% through the automatic
exercise of a PCT warrant issued to Hitachi on the Effective Date
(the PCT Warrant). If the Purchase Agreement is terminated under
certain other circumstances, Caladrius must return the Initial
Payment and pay a $5.0 million break-up fee within 90 days; if it
does not, Hitachis ownership in PCT will increase to 32.22%
through the automatic exercise of the PCT Warrant. Finally, if
the Purchase Agreement is terminated by Caladrius under certain
circumstances, Caladrius will retain the Initial Payment as a
break-up fee.

If the PCT Warrant is exercised, the Amended and Restated
Operating Agreement of PCT, LLC, a Caladrius Company, will be
amended to increase the size of the PCT board of managers from
five to six. If this were to occur, a representative of Hitachi
would be appointed as a new board member, resulting in two PCT
board members being appointed by Hitachi, and four PCT board
members being appointed by Caladrius. Currently, Hitachi has the
right to appoint, and has appointed, one of the five members of
the PCT board of managers.

Caladrius expects to enter into, or has entered into, certain
ancillary agreements in connection with the Sale, including: (i)
a Transition Services Agreement, which will be entered into as of
the date of Closing, between Caladrius and PCT (the Transition
Services Agreement), to which Caladrius will agree to provide PCT
with certain services over a transition period and (ii) that
certain Escrow Agreement to be entered into on the date of
Closing, to which $5.0 million of the Purchase Price will be put
into escrow on the date of Closing to cover indemnification
obligations of Caladrius under the Purchase Agreement, if any.

The Purchase Agreement has been provided to applicable rules and
regulations of the SEC in order to provide investors and
stockholders with information regarding its terms; however, it is
not intended to provide any other factual information about
Caladrius, PCT, Hitachi, their respective subsidiaries and
affiliates, or any other party. In particular, the
representations, warranties and covenants contained in the
Purchase Agreement have been made only for the purpose of the
Purchase Agreement and, as such, are intended solely for the
benefit of the parties to the Purchase Agreement. In many cases,
these representations, warranties and covenants are subject to
limitations agreed upon by the parties and are qualified by
certain disclosures exchanged by the parties in connection with
the execution of the Purchase Agreement. Furthermore, many of the
representations and warranties in the Purchase Agreement are the
result of a negotiated allocation of contractual risk among the
parties and, taken in isolation, do not necessarily reflect facts
about Caladrius, PCT, Hitachi, their respective subsidiaries and
affiliates or any other party. Likewise, any references to
materiality contained in the representations and warranties may
not correspond to concepts of materiality applicable to investors
or stockholders. Finally, information concerning the subject
matter of the representations and warranties may change after the
date of the Purchase Agreement and these changes may not be fully
reflected in Caladrius public disclosures.

AS A RESULT OF THE FOREGOING, INVESTORS AND STOCKHOLDERS ARE
STRONGLY ENCOURAGED NOT TO RELY ON THE REPRESENTATIONS,
WARRANTIES AND COVENANTS CONTAINED IN THE PURCHASE AGREEMENT, OR
ON ANY DESCRIPTIONS THEREOF, AS ACCURATE CHARACTERIZATIONS OF THE
STATE OF FACTS OR CONDITION OF CALADRIUS, PCT, HITACHI OR ANY
OTHER PARTY. INVESTORS, AND STOCKHOLDERS ARE LIKEWISE CAUTIONED
THAT THEY ARE NOT THIRD-PARTY BENEFICIARIES UNDER THE PURCHASE
AGREEMENT AND DO NOT HAVE ANY DIRECT OR CONTRACTUAL RIGHTS OR
REMEDIES TO THE PURCHASE AGREEMENT.

The foregoing description of the Purchase Agreement and the PCT
Warrant is not complete and is subject to and qualified in its
entirety by reference to the Purchase Agreement and the PCT
Warrant, copies of which are

attached as Exhibits 2.1 and 10.1, respectively, to this Current
Report on Form 8-K and incorporated into this Item 1.01 by
reference.

Support Agreement and Irrevocable Proxy

In connection with the Purchase Agreement, certain members of
Caladrius management and all members of the Caladrius Board, who
collectively are beneficial owners of approximately 9.8% of the
outstanding shares of Caladrius common stock, each entered into a
Support Agreement and Irrevocable Proxy (each a
Support Agreement), dated the Effective
Date, with Hitachi whereby each such stockholder agreed, among
other things, to vote all the shares of Caladrius stock owned
beneficially or of record by such stockholder (i) against any
Alternative Transaction (as such term is defined in the Purchase
Agreement) and any other matter that could reasonably be expected
to impede, interfere with, delay, postpone or adversely affect
the transactions contemplated by the Purchase Agreement and
certain related agreements and (ii) in favor of the Sale Proposal
(collectively, the Subject Proposals).
Each Support Agreement also contains a lock-up provision that,
subject to limited exceptions, prevents the stockholder party
thereto from transferring his shares of Caladrius stock. Each
Support Agreement terminates upon the earlier of (i) the Closing,
(ii) the termination of the Purchase Agreement and (iii) such
date and time as designated by Hitachi (the
Expiration Time). In addition, each
person signing a Support Agreement provided Hitachi an
irrevocable proxy with respect to any action, approval or consent
involving the Subject Proposals.

The foregoing description of the Support Agreements is not
complete and is subject to and qualified in its entirety by
reference to the form of Support Agreement, attached as Exhibit
99.1 to this Current Report on Form 8-K and incorporated into
this Item 1.01 by reference.

Additional Information About the Sale and Where to Find
it

Caladrius intends to file with the Securities and Exchange
Commission (SEC) and mail to its stockholders a proxy statement
in connection with, among other things, the Sale.
Investors and stockholders of Caladrius are urged to read
the proxy statement and the other relevant materials when they
become available because they will contain important information
about Caladrius and the Sale. The proxy statement and
other relevant materials (when they become available), and any
other documents filed by Caladrius with the SEC, may be obtained
free of charge at the SECs website at www.sec.gov. In addition,
investors and stockholders may obtain free copies of the
documents filed with the SEC by Caladrius by directing such
requests to Caladrius Biosciences, Inc., 420 Lexington Avenue,
Suite 350, New York, NY 10170, Attn: Jacquelyn Briggs or
[email protected], Telephone: (646) 606-2221.

Participants in the Solicitation

Caladrius and its directors and executive officers may, under SEC
rules, be deemed to be participants in the solicitation of
proxies from Caladrius stockholders in connection with the Sale.
Information regarding Caladrius directors and executive
officers is contained in Caladrius proxy statement on Schedule
14A filed with the SEC on May 10, 2016. Additional information
regarding the participants in the solicitation of proxies in
respect of the Sale and a description of their direct and
indirect interests, by security holdings or otherwise, will be
contained in the proxy statement when it becomes
available.

Safe Harbor for Forward Looking Statements

This Current Report on Form 8-K contains forward-looking
statements within the meaning of Private Securities Litigation
Reform Act of 1995, including forward-looking statements
regarding the Sale, the possibility of earning the Milestone
Payment, the possibility of obtaining stockholder or other
approvals or consents for the Sale and Caladrius future
prospects. These statements are neither promises nor guarantees,
but involve risks and uncertainties that could cause actual
events or results to differ materially from those set forth in
the forward-looking statements, including, without limitation:
risks and uncertainties relating to potential adverse reactions
or changes to business relationships resulting from the
announcement or completion of the Sale; unexpected costs, charges
or expenses relating to or resulting from the Sale; litigation or
adverse judgments relating to the Sale; risks relating to the
completion of the proposed Sale, including the risk that the
required stockholder vote might not be obtained in a timely
manner or at all, or other conditions to the completion of the
Sale not being satisfied; any difficulties associated with
requests or directions from governmental authorities resulting
from their review of the Sale; any changes in general economic
and/or industry-specific conditions; and other risks detailed in
Caladrius filings with the SEC, including those disclosed under
Item 1A. Risk Factors in

Caladrius Annual Report on Form 10-K filed with the SEC on March
17, 2017 and in subsequent reports on Forms 10-Q and 8-K and
other filings made with the SEC. You are cautioned not to place
undue reliance on forward-looking statements, which speak only as
of the date of this Current Report on Form 8-K. Caladrius does
not intend, and disclaims any obligation, to update or revise any
forward-looking information contained in this Current Report on
Form 8-K or with respect to the matters described herein.

Item5.02 Departure of Directors or Certain Officers; Election of
Directors; Appointment of Certain Officers; Compensatory
Arrangements of Certain Officers

On March 16, 2017, Caladrius entered into a Retention and
Incentive Agreement with Robert A. Preti, a former Caladrius
director and a co-founder and the President of PCT (the
Retention Agreement), to (i)
incentivize Dr. Preti to (a) continue in his position with PCT
from the Effective Date through the date of Closing and (b)
continue in his position with PCT and/or PCT Cell Therapy
Services, LLC, a subsidiary of Hitachi from and after the date of
Closing into the Milestone Period to facilitate a smooth
transition of the operations of PCT to ownership by Hitachi, and
(iii) to help ensure the ongoing participation of Dr. Preti in
PCT’s business, as this increases the likelihood of Caladrius
receiving the Milestone Payment. The Retention Agreement
supersedes all prior agreements and understandings between Dr.
Preti and Caladrius regarding the subject matter of the Retention
Agreement. The following is a brief description of the terms and
conditions of the Retention Agreement:

Continued Employment with PCT. to an employment
agreement between PCT and Dr. Preti, to be dated as of the
Effective Date (the Employment
Agreement) Dr. Preti will perform services as an
employee of PCT following the Closing.

Retention Payments. Subject in each case to Dr. Preti
signing a customary release, Dr. Preti will receive the following
compensation:

Simultaneously with the Closing, Caladrius will pay to Dr. Preti $1.375 million (the First Retention Payment).

As an incentive to remain employed with PCT and to use commercially reasonable efforts to cause PCT to maximize its overall performance and in particular to achieve the Milestone (but not contingent upon achieving the Milestone), Dr. Preti will receive a lump-sum cash retention and incentive payment equal to $1.375 million for the period from Closing until the date one year after the date of the Closing (the Anniversary Date), subject to Dr. Pretis continued employment with PCT through the Anniversary Date (the Second Retention Payment).

Dr. Preti will be entitled to 5% of the Milestone Payment if it is successfully earned (the Third Retention Payment and, together with the First Retention Payment and the Second Retention Payment, the Retention Payments).

Acceleration of Equity Awards; Exercise Period. Upon the
Closing, (i) all outstanding options and stock appreciation
rights of granted to Dr. Preti prior to the Closing shall be
fully vested and immediately exercisable in their entirety, and
(ii) all unvested stock awards, restricted stock units,
restricted stock, performance-based awards, and other awards
shall become fully vested. Dr. Preti will be able to exercise his
equity awards for up to three years following the Closing.

Bonuses. Dr. Preti shall be paid by PCT a bonus of
$196,112 with respect to the performance of PCT in 2016. In
addition, Caladrius shall pay or cause to be paid to Dr. Preti
the second installment of $175,000 of the sign on bonus to
Section 3(c) of Dr. Pretis employment agreement with PCT, dated
as of March 11, 2016, on March 11, 2018.

Resignation from Caladrius. Dr. Preti has agreed that,
effective upon the Effective Date, he resigns and is no longer an
officer or director of Caladrius (the
Resignation).

Payments for Taxes. If any payments under Pretis
Retention Agreement are subject to the excise tax imposed by
Section 4999 of the Code (the Excise
Tax), Caladrius shall pay to Dr. Preti an
additional payment (the Tax Reimbursement
Payment) in an amount such that the net amount
received by Dr. Preti after deducting all applicable taxes
(including any federal, state or local income taxes, any Excise
Tax, any taxes applicable to the payment to Dr. Preti of the Tax
Reimbursement Payment and any associated penalties or interest)
in connection

with the First Retention Payment and the Second Retention Payment
is not less than $1,200,000 in the aggregate.

Compensation Upon Termination of Employment. If PCT
terminates Dr. Pretis employment without Cause (as such term is
defined in the Employment Agreement) or Dr. Preti terminates his
employment for Good Reason (as such term is defined in the
Employment Agreement) or if Dr. Pretis employment under the
Employment Agreement is terminated by reason of death or
Disability (as such term is defined in the Employment Agreement),
in each case to the terms of the Employment Agreement, Caladrius
shall pay Dr. Preti or his estate, as the case may be, the unpaid
Retention Payments. If before a Retention Payment is paid, PCT
terminates Dr. Pretis employment for Cause or Dr. Preti
terminates his employment for other than Good Reason, in each
case to the Employment Agreement, Caladrius shall have no
obligations to pay any as yet unpaid Retention Payment(s) or any
other amount to Dr. Preti or any other person.

All Payments Contingent on Closing of the Sale. No
payment, other than the $196,112 with respect to the performance
of PCT in 2016, will be made under the Retention Agreement unless
and until the Closing occurs.

The foregoing description of the Retention Agreement is not
complete and is subject to and qualified in its entirety by
reference to copy of the Retention Agreement, attached as Exhibit
10.2 to this Current Report on Form 8-K and incorporated into
this Item 5.02 by reference.

Item8.01 Other Events.

On March 16, 2017, Caladrius issued a press release, announcing
the Sale. A copy of the press release is filed as Exhibit99.2 to
this Current Report on Form8-K and is incorporated herein by
reference.

Item9.01 Financial Statements and Exhibits.

(d) Exhibits.

The Exhibit Index appearing immediately after the page to this
Current Report on Form 8-K is incorporated herein by reference.

About CALADRIUS BIOSCIENCES, INC. (NASDAQ:CLBS)

Caladrius Biosciences, Inc., formerly NeoStem, Inc., through its subsidiary, PCT, LLC, a Caladrius Company (PCT), provides development and manufacturing services to the cell therapy industry (which includes cell-based gene therapy). PCT specializes in cell and cell-based gene therapies. PCT offers development and manufacturing capabilities, quality systems, cell and tissue processing, logistics, storage and distribution and engineering solutions to clients with therapeutic candidates at all stages of development. The Company’s product candidate, CLBS03, is a T regulatory cell (Treg) clinical Phase II therapy targeting adolescents with recent-onset type 1 diabetes mellitus (T1DM) using the patient’s own numerically and functionally enhanced Tregs. This therapy is based on a platform technology for immunomodulation. The Company’s T Regulatory Cell Technology is applicable to multiple autoimmune and allergic diseases.

CALADRIUS BIOSCIENCES, INC. (NASDAQ:CLBS) Recent Trading Information

CALADRIUS BIOSCIENCES, INC. (NASDAQ:CLBS) closed its last trading session up +0.10 at 5.10 with 94,102 shares trading hands.