MESOBLAST LTD — Capital/Financing Update 2018

May 14, 2018

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15 May 2018

The Manager Company Notices Section ASX Limited Level 4, North Tower, Rialto Towers 525 Collins Street MELBOURNE VIC 3000

Dear Sir/Madam

Notice under section 708A(5)(e) of the Corporations Act 2001 (Cth)

This notice is given by Mesoblast Limited ACN 109 431 870 (Mesoblast) under section 708A(5)(e) of the Corporations Act 2001 (Cth) (Corporations Act).

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Mesoblast has today issued 892,857 fully paid ordinary shares in Mesoblast (the Shares) as consideration for the license of certain intellectual property assets from a third party.

Mesoblast advises that:

1. the Shares were issued without disclosure to investors under Part 6D.2 of the Corporations Act;

2. this notice is being given under section 708A(5)(e) of the Corporations Act;

3. as at the date of this notice, Mesoblast has complied with:

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

5. (b) section 674 of the Corporations Act; and

6. as at the date of this notice, there is no excluded information of the type referred to in sections 708A(7) and 708A(8) of the Corporations Act

Yours sincerely

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Charlie Harrison Company Secretary Mesoblast Limited

Rule 2.7, 3.10.3, 3.10.4, 3.10.5

Appendix 3B

New issue announcement, application for quotation of additional securities and agreement

Information or documents not available now must be given to ASX as soon as available. Information and documents given to ASX become ASX’s property and may be made public.

Introduced 01/07/96 Origin: Appendix 5 Amended 01/07/98, 01/09/99, 01/07/00, 30/09/01, 11/03/02, 01/01/03, 24/10/05, 01/08/12, 04/03/13

Name of entity

MESOBLAST LIMITED (Mesoblast)

ABN

68 109 431 870

We (the entity) give ASX the following information.

Part 1 - All issues

You must complete the relevant sections (attach sheets if there is not enough space).

• 1 +Class of +securities issued or to be issued

• 2 Number of[+] securities issued or to be issued (if known) or maximum number which may be issued

Ordinary shares. 926,190 ordinary shares.

• 3 Principal terms of the[+] securities (e.g. if options, exercise price and expiry date; if partly paid +securities, the amount outstanding and due dates for payment; if[+] convertible securities, the conversion price and dates for conversion)

926,190 ordinary shares (fully paid) as per the company’s constitution.

• 4 Do the +securities rank equally in all respects from the +issue date with an existing +class of quoted +securities?

Yes.

If the additional +securities do not rank equally, please state:

• the date from which they do

• the extent to which they participate for the next dividend, (in the case of a trust, distribution) or interest payment

• the extent to which they do not rank equally, other than in relation to the next dividend, distribution or interest payment

• See chapter 19 for defined terms. Appendix 3B Page 1

04/03/2013

5 Issue price or consideration

892,857 ordinary shares (fully paid) issued for consideration of US$1,000,000 (A$1.49 per share).

33,333 ordinary shares (fully paid) issued upon the exercise of options in accordance with the Company’s Employee Share Option Plan for consideration of A$43,666.

• 6 Purpose of the issue (If issued as consideration for the acquisition of assets, clearly identify those assets)

892,857 ordinary shares issued as consideration for the license of certain intellectual property assets from a third party.

33,333 ordinary shares (fully paid) issued upon the exercise of options in accordance with the Company’s Employee Share Option Plan.

• 6a Is the entity an +eligible entity that has obtained security holder approval under rule 7.1A?

No

If Yes, complete sections 6b – 6h in relation to the +securities the subject of this Appendix 3B , and comply with section 6i

• 6b The date the security holder resolution under rule 7.1A was passed

• 6c Number of +securities issued without security holder approval under rule 7.1

• 6d Number of +securities issued with security holder approval under rule 7.1A

• 6e Number of +securities issued with security holder approval under rule 7.3, or another specific security holder approval (specify date of meeting)

• 6f Number of +securities issued under an exception in rule 7.2

• 6g If +securities issued under rule 7.1A, was issue price at least 75% of 15 day VWAP as calculated under rule 7.1A.3? Include the +issue date and both values. Include the source of the VWAP calculation.

• 6h If[+] securities were issued under rule 7.1A for noncash consideration, state date on which valuation of consideration was released to ASX Market Announcements

• 6i Calculate the entity’s remaining issue capacity under rule 7.1 and rule 7.1A – complete Annexure 1 and release to ASX Market Announcements

Not applicable

Not applicable
Not applicable
Not applicable
Not applicable
Not applicable
Not applicable
Not applicable
Date Registered 6 March 2018 6 March 2018 15 May 2018 Total	Number of ordinary shares issued 25,000 8,333 892,857 926,190
Number	+Class

• See chapter 19 for defined terms.

Appendix 3B Page 2

04/03/2013

474,165,078

• 8 Number and[+] class of all[+] securities quoted on ASX ( including the[+] securities in section 2 if applicable)

• 9 Number and[+] class of all[+] securities not quoted on ASX ( including the[+] securities in section 2 if applicable)

• 10 Dividend policy (in the case of a trust, distribution policy) on the increased capital (interests)

Ordinary shares

Number	+Class
27,036,000 (1,061,667 options have been cancelled since last Appendix 3B) 1,500,000	Unquoted options Incentive rights

All ordinary shares rank equally and participate in the right to dividends equally.

Part 2 - Pro rata issue

• 11 Is security holder approval required?

• 12 Is the issue renounceable or non-renounceable?

• 13 Ratio in which the[+] securities will be offered

• 14 +Class of +securities to which the offer relates

• 15 +Record date to determine entitlements

• 16 Will holdings on different registers (or subregisters) be aggregated for calculating entitlements?

• 17 Policy for deciding entitlements in relation to fractions

• 18 Names of countries in which the entity has security holders who will not be sent new offer documents

Not applicable Not applicable Not applicable Not applicable Not applicable

Not applicable

Not applicable Not applicable

Note: Security holders must be told how their entitlements are to be dealt with.

Cross reference: rule 7.7.

• 19 Closing date for receipt of acceptances or renunciations

• 20 Names of any underwriters

• 21 Amount of any underwriting fee or commission

• 22 Names of any brokers to the issue

• 23 Fee or commission payable to the broker to the issue

• 24 Amount of any handling fee payable to brokers who lodge acceptances or renunciations on behalf of security holders

• 25 If the issue is contingent on security holders’ approval, the date of the meeting

• 26 Date entitlement and acceptance form and offer

Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable

Not applicable

• See chapter 19 for defined terms.

Appendix 3B Page 3

04/03/2013

documents will be sent to persons entitled

• 27 If the entity has issued options, and the terms entitle option holders to participate on exercise, the date on which notices will be sent to option holders

• 28 Date rights trading will begin (if applicable)

• 29 Date rights trading will end (if applicable)

• 30 How do security holders sell their entitlements in full through a broker?

• 31 How do security holders sell part of their entitlements through a broker and accept for the balance?

• 32 How do security holders dispose of their entitlements (except by sale through a broker)?

• 33 +Issue date

Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable

Part 3 - Quotation of securities

You need only complete this section if you are applying for quotation of securities

• 34 Type of[+] securities ( tick one )

• (a) +Securities described in Part 1

• (b) All other +securities

Example: restricted securities at the end of the escrowed period, partly paid securities that become fully paid, employee incentive share securities when restriction ends, securities issued on expiry or conversion of convertible securities

• See chapter 19 for defined terms. Appendix 3B Page 4

04/03/2013

Entities that have ticked box 34(a)

Additional securities forming a new class of securities

Tick to indicate you are providing the information or documents

35[If the +securities are +equity securities, the names of the 20 largest holders of the additional +securities, and the ] number and percentage of additional[+] securities held by those holders

36[If the +securities are +equity securities, a distribution schedule of the additional +securities setting out the number of ] holders in the categories 1 - 1,000 1,001 - 5,000 5,001 - 10,000 10,001 - 100,000 100,001 and over

37[A copy of any trust deed for the additional +securities ]

Entities that have ticked box 34(b)

38 Number of+securities for which+quotation is sought 39 +Class of +securities for which quotation is sought 40 Do the+securities rank equally in all respects from the+issue date with an existing+class of quoted +securities? If the additional+securities do not rank equally, please state: • the date from which they do • the extent to which they participate for the next dividend, (in the case of a trust, distribution) or interest payment • the extent to which they do not rank equally, other than in relation to the next dividend, distribution or interest payment 41 Reason for request for quotation now Example: In the case of restricted securities, end of restriction period (if issued upon conversion of another+security, clearly identify that other+security) 42 Number and+class of all+securities quoted on ASX (_including_the+securities in clause 38)	Not applicable
	Not applicable
	Not applicable
	Not applicable
	Number	+Class
	Not applicable	Not applicable

• See chapter 19 for defined terms. Appendix 3B Page 5

04/03/2013

Quotation agreement

• 1 +Quotation of our additional +securities is in ASX’s absolute discretion. ASX may quote the +securities on any conditions it decides.

• 2 We warrant the following to ASX.

• The issue of the[+] securities to be quoted complies with the law and is not for an illegal purpose.

• There is no reason why those[+] securities should not be granted[+] quotation.

• An offer of the[+] securities for sale within 12 months after their issue will not require disclosure under section 707(3) or section 1012C(6) of the Corporations Act.

Note: An entity may need to obtain appropriate warranties from subscribers for the securities in order to be able to give this warranty

• Section 724 or section 1016E of the Corporations Act does not apply to any applications received by us in relation to any +securities to be quoted and that no-one has any right to return any +securities to be quoted under sections 737, 738 or 1016F of the Corporations Act at the time that we request that the +securities be quoted.

• If we are a trust, we warrant that no person has the right to return the[+] securities to be quoted under section 1019B of the Corporations Act at the time that we request that the[+] securities be quoted.

• 3 We will indemnify ASX to the fullest extent permitted by law in respect of any claim, action or expense arising from or connected with any breach of the warranties in this agreement.

• 4 We give ASX the information and documents required by this form. If any information or document is not available now, we will give it to ASX before[+] quotation of the[+] securities begins. We acknowledge that ASX is relying on the information and documents. We warrant that they are (will be) true and complete.

Sign here:

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Date: 15 May 2018 Company secretary

Print name: Charlie Harrison

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• See chapter 19 for defined terms. Appendix 3B Page 6

04/03/2013