Option Agreement With Array Capital, LLC For 1,000,000 Shares

TH E SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), HOWEVER THE SHARES THAT WOULD ISSUE HAVE BEEN REGISTERED. SUCH SECURITIES MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN EXEMPTION THEREFROM UNDER SAID ACT.







Option to Purchase







1,000,000 SHARES







AMERICAN STEM CELL CORPORATION.







(Incorporated under the laws of the State of Nevada)







OPTION CERTIFICATE FOR THE PURCHASE OF SHARES OF THE $.001

PAR VALUE

COMMON STOCK OF AMERICAN STEM CELL CORPORATION.







EXERCISABLE ONLY AFTER April 10, 2005

AND VOID AFTER March 31, 2006



1. American Stem Cell Corporation. (the "Company'), hereby certifies that, for value received, Array Capital management, LLC (referred to as the "Holder"), is entitled to purchase, subject to the terms and conditions set forth in this agreement, at anytime from and after April 10, 2005 , and on or before March 31, 2006 (the "Option Period"), up to 1,000,000 shares of the $.001 par value common stock ("Common Stock") of the Company. This Option may be exercised in whole or in part. Such exercise shall be accomplished by tender to the Company of the purchase price of $1.00 per share (the "Option Price"'), either in cash or by certified check or bank cashier's check, payable to the order of the Company, together with presentation and surrender to the Company of this Option with an executed subscription in substantially the form attached hereto as Exhibit A. Fractional shares of the Company's Common Stock will not be issued upon the exercise of this Option. Upon twenty (20) days' prior written notice to all holders of the Options, the Company shall have the right to reduce the exercise price and/or extend the term of the Options.







2. The Company agrees at all times to reserve and hold available out of the aggregate of its authorized but unissued Common Stock the number of shares of its Common Stock issuable upon the exercise of this and all other Options of like tenor then outstanding. The Company further covenants and agrees that all shares of Common Stock that may be delivered upon the exercise of this Option will, upon delivery, be fully paid and non-assessable and free from all taxes, liens and charges with respect to the purchase thereof hereunder.


3. This Option does not entitle the Holder to any voting rights or other rights as a shareholder of the Company, nor to any other rights whatsoever except the rights herein set forth, and no dividend shall be payable or accrue by reason of this Option or the interest represented hereby, or the shares purchasable hereunder, until or unless, and except to the extent that, this Option is exercised.


4. The Option Price and the number of shares purchasable upon the exercise of this Option are subject to adjustment from time to time upon the occurrence of any of the events specified in this Section 4.



(a) In case the Company shall (i) pay a dividend in shares of Common Stock or make a distribution in shares of Common Stock, (ii) subdivide its outstanding shares of Common Stock into a greater number of shares, (iii) combine its outstanding shares of Common Stock into a smaller number of shares of Common Stock, or (iv) issue by reclassification of its shares of Common Stock other securities of the Company, the number of shares of Common Stock purchasable upon exercise of this Option immediately prior thereto shall be adjusted ...