CYTOMEDIX INC, 10QSB, 2000-05-15

CYTOMEDIX INC
10QSB, 2000-05-15
COMMERCIAL PHYSICAL & BIOLOGICAL RESEARCH

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<PAGE>

U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 10-QSB

[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2000

[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

For the transition period from ___________ to ___________

Commission file number 0-28443

CYTOMEDIX, INC.

- --------------------------------------------------------------------------------
(Exact name of small business issuer as specified in its charter)

Delaware 23-2958959

- --------------------------------------------------------------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)

1523 Bowman Road, Suite A, Little Rock, Arkansas 72211

- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)

(501) 225-8400

- --------------------------------------------------------------------------------
Issuer's telephone number

AuTologous Wound Therapy, Inc.

- --------------------------------------------------------------------------------
(Former name, former address, and former fiscal year,
if changed since last report)

Check whether the issuer: (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. YES [X] NO [ ]

APPLICABLE ONLY TO CORPORATE ISSUERS

State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date:

COMMON STOCK, $.0001 PAR VALUE: 10,500,934
AS OF MAY 12, 2000

Transitional Small Business Disclosure Format (check one): YES [ ] NO [X]

<PAGE>

PART I
FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

Certain information and footnote disclosures required under generally
accepted accounting principles have been condensed or omitted from the following
condensed financial statements pursuant to the rules and regulations of the
Securities and Exchange Commission, although Cytomedix, Inc. believes that such
financial disclosures are adequate to assure that the information presented is
not misleading in any material respect. The following condensed financial
statements should be read in conjunction with the year-end financial statements
and notes thereto included in Cytomedix's Annual Report on Form 10-KSB for the
fiscal year ended December 31, 1999.

The results of operations for the interim periods presented herein are not
necessarily indicative of the results to be expected for the entire fiscal year.

CYTOMEDIX, INC.
(A DEVELOPMENT STAGE ENTITY)
Condensed Balance Sheet
<TABLE>
<CAPTION>
ASSETS
March 31,
2000
(Unaudited)
-----------
<S> <C>
Current Assets
Cash $ 7,388,239
Receivables and prepaid expenses 101,581
Note receivable - related party 5,500
-----------
Total Current Assets 7,495,320

Property and Equipment, Net 203,284

Prepaid Expenses and Deposits 14,500
-----------
$ 7,713,104
===========

LIABILITIES AND STOCKHOLDERS' EQUITY

Current Liabilities
Short-term borrowings and current portion of long-term debt $ 90,441
Notes payable - related party 100,052
Accounts payable and accrued expenses 276,229
Deferred revenue 30,000
-----------
Total Current Liabilities 496,722

Long-Term Liabilities 91,349
-----------
Total Liabilities 588,071
-----------

Commitment and Contingencies

Mandatorily redeemable Series A 5% cumulative preferred stock;
$.0001 par value; $1 liquidation value; authorized, issued and outstanding -
1,625,000 shares 1,625,000
-----------

Stockholders' Equity
Series B preferred stock
$.0001 par value; $.0001 liquidation value;
authorized - 7,500,000; at March 31, 2000,
issued and outstanding - 5,705,000 shares 570
Common stock; $.0001 par value; at March 31, 2000, authorized -
40,000,000 shares; issued and outstanding - 10,528,875 shares 1,053
Additional paid-in capital 42,509,903
Stock subscription note receivable (1,000)
Deferred compensation (24,296,572)
Deficit accumulated in the development stage (12,713,921)
-----------
Total Stockholders' Equity 5,500,033
-----------
$ 7,713,104
===========
</TABLE>
See notes to condensed financial statements

2
<PAGE>

CYTOMEDIX, INC.
(A DEVELOPMENT STAGE ENTITY)
Condensed Statements of Operations
<TABLE>
<CAPTION>
December 11, 1998
Three Months Ended March 31, (Date of Incep-
------------------------------ tion through
1999 2000 March 31, 2000
(Unaudited) (Unaudited) (Unaudited)
----------- ------------ -------------
<S> <C> <C> <C>
Revenues $ 1,100 $ 34,504 $ 43,104

Cost of Sales - 5,236 31,106
----------- ------------ -------------

Gross Profit 1,100 29,268 11,998
----------- ------------ -------------

Operating Expenses
Salaries and wages 217,555 434,178 1,449,691
Consulting expense - 5,688,023 7,654,386
Professional fees - 196,004 477,931
Merger costs - - 2,678,700
General and administrative expenses 52,121 199,262 446,409
----------- ------------ -------------
Total Operating Expenses 269,676 6,517,467 12,707,117
----------- ------------ -------------

Loss from Operations (268,576) (6,488,199) (12,695,119)
----------- ------------ -------------

Other (Income) Expense
Interest expense - 2,692 5,584
Interest income - (19,795) (20,228)
----------- ------------ -------------
Total Other (Income), Net - (17,103) (14,644)
----------- ------------ -------------

Net Loss (268,576) (6,471,096) (12,680,475)

Preferred Dividend - 20,312 33,446
----------- ------------ -------------

Net loss to common stockholders $ (268,576) $ (6,491,408) $ (12,713,921)
=========== ============ =============

Basic and Diluted Loss Per Common Share $ (0.05) $ (0.69)
=========== ============

Weighted Average Shares Outstanding 4,936,111 9,343,089
=========== ============
</TABLE>

See notes to condensed financial statements

<PAGE>

CYTOMEDIX, INC.
(A DEVELOPMENT STAGE ENTITY)
Condensed Statements of Cash Flows
<TABLE>
<CAPTION>

Three Months Ended March 31, December 11, 1998
----------------------------- (Inception) through
1999 2000 March 31, 2000
(Unaudited) (Unaudited) (Unaudited)
----------- ----------- ---------------------
<S> <C> <C> <C>
Cash Flows from Operating Activities
Net loss $(268,576) $(6,471,096) $(12,680,475)
--------- ----------- ------------
Adjustments to reconcile net loss to net cash
provided by (used in) operating activities
Depreciation and amortization - 6,532 10,587
Consulting expense recorded for issuance of warrants
and options under service agreement - 5,573,500 7,427,301
Compensation expense recorded for issuance of stock
options under stock option plan - employees and officer 185,625 261,452 1,003,952
Compensation expense recorded for the assumption of
debt of an officer - related party - - 67,000
Merger expenses recorded for issuance of common stock
in connection with merger with Informatix - - 2,678,700
Changes in assets 3,348 (36,584) (86,249)
Changes in liabilities (1,674) 73,271 307,214
--------- ----------- ------------

Total Adjustments 187,299 5,878,171 11,408,505
--------- ----------- ------------

Net Cash Used in Operating Activities (81,277) (592,925) (1,271,970)
--------- ----------- ------------

Cash Flows from Investing Activities
Purchase of equipment - (144,199) (162,275)
Cash acquired in merger with Informatix - - 398,934
Advances to employees and related parties, net of repayments (775) 3,541 (11,470)
--------- ----------- ------------

Net Cash (Used in) Provided by Investing (775) (140,658) 225,189
--------- ----------- ------------

Cash Flows from Financing Activities
Proceeds from line of credit - 43,590 67,314
Repayments on long-term debt - (4,797) (15,565)
Proceeds from notes payable - stockholders 83,221 - 193,324
Repayment of notes payable - stockholders - (44,000) (258,500)
Proceeds from sale of common stock, net of offering costs paid - 8,003,234 8,448,447
--------- ----------- ------------

Net Cash Provided by Financing Activities 83,221 7,998,027 8,435,020
--------- ----------- ------------

Net Increase in Cash 1,169 7,264,444 7,388,239

Cash, Beginning of Period 92 123,795 -
--------- ----------- ------------

Cash, End of Period $ 1,261 $ 7,388,239 $ 7,388,239
========= =========== ============

Cash Paid for Interest $ - $ 2,692 $ 6,950
========= =========== ============

Cash Paid for Income Taxes $ - $ - $ -
========= =========== ============
</TABLE>

See notes to condensed financial statements

4
<PAGE>

CYTOMEDIX, INC.
(A DEVELOPMENT STAGE ENTITY)
Notes to Condensed Financial Statements
(Unaudited)

NOTE 1 - BASIS OF PRESENTATION

The financial statements included herein have been prepared by Cytomedix,
without audit, pursuant to the rules and regulations of the Securities and
Exchange Commission. Certain information and footnote disclosures normally
included in financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted pursuant to such rules and
regulations. These financial statements should be read in conjunction with the
financial statements and notes thereto included in the Cytomedix's Annual Report
on Form 10-KSB for the year ended December 31, 1999.

In the opinion of Cytomedix's management, the accompanying unaudited
condensed financial statements contain all adjustments, consisting solely of
those adjustments which are of a normal recurring nature, necessary to present
fairly its financial position as of March 31, 2000 and the results of its
operations and its cash flows for the three months ended March 31, 2000 and
1999, and the period from December 11, 1998 (inception) through March 31, 2000.

Interim results are not necessarily indicative of results for the full
fiscal year.

Cytomedix is a development stage enterprise, and accordingly, certain
additional financial information is required to be included in the financial
statements from the inception of Cytomedix to the current balance sheet date.

The combination of Cytomedix and AuTologous Wound Therapy, Inc. has been
treated as a recapitalization of Cytomedix. Cytomedix was the legal acquirer in
the merger. AuTologous Wound Therapy, Inc. was the accounting acquirer since its
shareholders acquired a majority ownership interest in Cytomedix. Consequently,
the historical financial information included in these financial statements
prior to November 1999 is that of AuTologous Wound Therapy, Inc. All significant
intercompany transactions and balances have been eliminated. Pro forma financial
information is not presented since the combination is a recapitalization and not
a business combination.

Basic and diluted loss per share was calculated based upon the net loss
available to common shareholders divided by the weighted average number of
shares of common stock outstanding during the period. Options and warrants to
purchase common stock are not included in the computation of diluted loss per
share because the effect of these instruments would be anti-dilutive for loss
periods presented.

NOTE 2 - COMMITMENTS AND CONTINGENCIES

On January 12, 2000, Cytomedix and The Kriegsman Group entered into a
three-year consulting agreement, whereby Kriegsman agreed to assist Cytomedix in
recruiting members for its Board of Directors, Advisory Board and senior
executives to complete Cytomedix's management team. In consideration for these
services, Kriegsman received a non-refundable consulting fee of $25,000 and is
entitled to a consulting fee of $5,000 per month over the life of the agreement
for every $3,000,000 raised on behalf of Cytomedix by Kriegsman through equity
placements, strategic alliances, joint ventures or license agreements up to a
maximum of $25,000 per month. The monthly consulting fee will commence once
Kriegsman has raised the first $3,000,000. For signing the agreement in January
2000, Kriegsman received options to purchase 150,000 shares of common stock of
Cytomedix. The options have a term of five years and an exercise price of $4.00
per share. Cytomedix is required to register the common stock underlying these
options in a registration statement following Kriegsman's exercise of its
options, and filed by Cytomedix on behalf of stockholders possessing demand
registration rights. Kriegsman is also entitled to receive additional options to
purchase up to a maximum of 450,000 shares of common stock with a term of five
years and an exercise price of $4.00, based on Kriegsman meeting certain
performance criteria. Out of these additional options, in March 2000 Kriegsman
received options to purchase 150,000 shares of common stock for placement of a
senior executive and options to purchase 125,000 shares of common stock for
placement of two

5
<PAGE>
CYTOMEDIX, INC.
(A DEVELOPMENT STAGE ENTITY)
Notes to Condensed Financial Statements
(Unaudited)

NOTE 2 - COMMITMENTS AND CONTINGENCIES (CONTINUED)

members on the Board of Directors of Cytomedix. Kriegsman will receive options
to purchase 125,000 shares of common stock for every $1,000,000 dollars raised
by Kriegsman over the first $3,000,000 until the maximum options are received.
The above options provide that if the Food and Drug Administration requires
Cytomedix to go through regulatory approval, Kriegsman will be granted a
one-time three-year extension to the term of its options. The agreement also
calls for Kriegsman to receive a fee of 8% of the proceeds raised from any
equity or debt placement initiated by Kriegsman (see Note 3). In the first
quarter of 2000, Kriegsman raised $2,650,000 and consequently received a fee of
approximately $213,000. Cytomedix has also agreed to issue Kriegsman warrants
representing the rights to purchase 10% of the shares issued in the equity
placement (or shares into which debt is convertible). The warrants will have a
term of five years and an exercise price equal to the per share price of any
equity raised or the conversion price of common stock for any convertible debt
offerings. In the event Kriegsman arranges for the merger, sale or acquisition
of Cytomedix, then all remaining outstanding options shall immediately vest and
Kriegsman will be paid a success fee on the closing of the transaction equal to
6% of the value of the consideration received in such transaction by Cytomedix
or its stockholders.

NOTE 3 - CAPITAL STOCK ACTIVITY

In February 2000, Cytomedix completed a private placement offering to
one accredited investor. The private placement offering was for 250,000 shares
of Cytomedix's common stock at $3.00 per share, raising gross proceeds of
$750,000. Costs paid for investment banking fees relating to this offering
amounted to $75,000.

In March 2000, Cytomedix completed another private placement offering
of its common stock. Cytomedix sold 771,500 shares of it common stock at $10.00
per share, raising gross proceeds of $7,715,000. In connection with this private
placement, Cytomedix paid investment banking fees of approximately $441,267. In
addition, 10,000 shares of Cytomedix's common stock were issued to an investment
banker as a placement fee; and warrants for 26,500 shares of common stock were
issued as a placement fee pursuant to an agreement between Kriegsman (see Note
2) and Cytomedix, based on gross funds raised by Kriegsman. This private
placement also completed the requirements of the Agreement of Merger and
Reorganization between Cytomedix and old AuTologous Wound Therapy, whereby
Cytomedix was required to raise gross proceeds of $1,200,000 in a series of
private placements over one year following the merger. The merger agreement
called for the conversion of one share of Series B preferred stock into three
shares of Cytomedix's common stock for each share of common stock sold in
private placements to raise the $1,200,000. Therefore, Cytomedix, issued 885,000
shares of its common stock in conversion of 295,000 shares of Series B preferred
stock.

Cytomedix has 1,625,000 shares of Series A 5% cumulative preferred
stock outstanding, with a par value of $.0001, a liquidation preference of $1.00
per share and pays a 5% cumulative dividend on the liquidation value. The Series
A preferred stock has a mandatory redemption feature, whereby at the earlier of
seven years after issuance or Cytomedix meeting certain performance criteria,
Cytomedix is obligated to redeem the shares in cash at the liquidation value
plus all accrued and unpaid dividends. Cytomedix may, in its sole discretion,
pay the dividends in cash or in common stock of Cytomedix. Each share of Series
A preferred stock has one vote in all matters voted on by holders of the common
stock of Cytomedix. As of March 31, 2000, Cytomedix had accrued cumulative
preferred dividends in the amount of $33,446.

NOTE 4 - OPTIONS AND WARRANTS GRANTED

During the quarter ended March 31, 2000, Cytomedix issued 425,000
options to Kriegsman representing the 150,000 options guaranteed per the
agreement, and 275,000 for the placement of the senior executive and placement
of the Board members. Cytomedix recorded consulting expense in the amount of
$4,985,000 in connection with the issuance of these options. In addition,
Kriegsman raised approximately $2,650,000 of the proceeds from the March private
placement (see Note 3) and was issued warrants for 26,500 shares of Cytomedix's
common stock with an exercise price equal to the offering price of $10.00 per
share, as per its agreement with

<PAGE>

CYTOMEDIX, INC.
(A DEVELOPMENT STAGE ENTITY)
Notes to Condensed Financial Statements
(Unaudited)

NOTE 4 - OPTIONS AND WARRANTS GRANTED (CONTINUED)

Cytomedix. The issuance of these warrants was considered to be a cost of raising
capital. Therefore, the warrants were recorded by an increase and corresponding
decrease to additional paid in capital.

Cytomedix recorded consulting expense in the amount of $338,500 in
connection with the issuance of options to purchase 50,000 shares of common
stock granted to Sigma Healthcare Consulting in January 2000. The options have
an exercise price of $4.00 per share and a term of five years.

In March 2000, Cytomedix issued options to purchase 1,600,000 shares of
Cytomedix's common stock to four new executives under their respective
employment agreements with Cytomedix. The options have an exercise price of
$7.00 per share. The deferred compensation related to the options will be
amortized over the three year vesting period, ending on December 31, 2002.
However, all options shall become immediately exercisable at such time that the
common stock of Cytomedix trades at or above 37 and 5/8ths dollars per share
(the "Target Price"), as quoted on the securities exchange where Cytomedix stock
is currently being traded and during either of the two periods, chosen at the
option of the respective executive, the closing price for the stock is at or
above the Target Price for fifteen consecutive trading days; or the closing
price for the stock is at or above the Target Price for twenty out of thirty
consecutive trading days.

The 1,600,000 options issued to the new executives have anti-dilution
provisions, which would prevent the value of the options from being reduced
should Cytomedix issue any type of equity security, or act in any other way that
would immediately reduce the value of the options. Therefore, as a result of the
March 2000 private placement, Cytomedix is required under the anti-dilution
provisions to issue 173,440 additional options. The options to purchase shares
expire ten years from the date each option becomes exercisable. Cytomedix
recorded $18,754,128 of deferred compensation in connection with the 1,773,440
options to be issued to the new executives. As of March 31, 2000 Cytomedix had
amortized approximately $29,375 of the above deferred compensation.

Cytomedix issued options to purchase 45,000 shares of Cytomedix's
common stock to other employees. These options have exercise prices ranging from
$4.00 to $5.00 per share. The options all carry terms of five years from the
date of issuance, and vest 12 months after issuance. Cytomedix recorded $478,063
of deferred compensation in connection with the issuance, $46,452 of which was
expensed as compensation during the quarter. The remaining balance of $431,611
will be ratably expensed over the vesting period.

NOTE 5 - LOSS PER SHARE

As of March 31, 1999 and 2000 Cytomedix had issued and issuable
warrants and options to acquire 750,000 and 4,067,490 shares of common stock of
Cytomedix, respectively, with exercise prices ranging from $.0002 to $10.00 per
share. These options and warrants were not included in the calculation of
weighted average common stock outstanding as of March 31, 1999 and 2000 because
the effect would have been anti-dilutive to the presentation of loss per share.

NOTE 6 - NEW CORPORATE HEADQUARTERS

Cytomedix is relocating its corporate headquarters to suburban Chicago,
Illinois while maintaining its current offices in Little Rock, Arkansas. In
April 2000, Cytomedix, Inc. entered into a three year lease for this office
space at an annual rental rate of approximately $149,000 per year.

7
<PAGE>

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS AND PLAN OF OPERATIONS

The following discussion should be read in conjunction with our
condensed financial statements and related notes thereto included in Item 1
above and our audited financial statements and related notes thereto, and
management's discussion and analysis for the year ended December 31, 1999,
included in our annual report filed on Form 10-KSB for such period.

The terms "Cytomedix," "our" and "we," as used in this quarterly
report, refer to Cytomedix, Inc.

When used in this Form 10-QSB and in other filings by Cytomedix with
the Securities and Exchange Commission, the words "believes," "plans,"
"anticipates", "will likely result," "will continue," "projects," "expects," and
similar expressions are intended to identify "forward-looking statements" within
the meaning of the Private Securities Litigation Reform Act of 1995. Such
statements are subject to certain risks and uncertainties, which could cause
actual results to differ materially from those projected.

Cytomedix cautions the readers not to place undue reliance on any
forward looking statements, which are based on certain assumptions and
expectations which may or may not be valid or actually occur, and which involve
risks of product demand, market acceptance, economic conditions, competitive
products and pricing, difficulties in product development, adequacy and
availability of reimbursement or other payments from private and public
insurance programs, adverse changes in government regulation or policy,
commercialization, and technology and other risks. In addition, sales and other
revenues may not commence and/or continue as anticipated due to delays or
otherwise. As a result, our actual results for future periods could differ
materially from those anticipated or projected.

These forward-looking statements speak only as of the date hereof. We
do not intend to update the forward-looking statements contained in this report,
so as to reflect events or circumstances after the date hereof or to reflect the
occurrence of unanticipated events, except as may occur as part of our ongoing
periodic reports filed with the Securities and Exchange Commission.

OVERVIEW

We are a Delaware corporation formed on April 29, 1998. Prior to
November 4, 1999, we were known as Informatix Holdings, Inc., which was
originally a public shell company, defined as an inactive, publicly-traded
company with nominal assets and liabilities. On November 4, 1999, AuTologous
Wound Therapy, Inc., an Arkansas corporation formed on December 11, 1998, merged
with and into Informatix Holdings. In the merger, each share of issued and
outstanding common stock of AuTologous Wound Therapy was converted into fifty
shares of common stock and fifty shares of Series B convertible preferred stock
of Informatix Holdings after giving effect to a one-for-two reverse stock split
of Informatix Holdings' common stock effective November 8, 1999. Simultaneously
with the consummation of the merger, the name of the surviving corporation,
Informatix Holdings, was changed to AuTologous Wound Therapy, Inc. We
subsequently changed our name to Cytomedix, Inc., effective March 30, 2000.

PLAN OF OPERATIONS

Prior to the above merger, we had no products or services and we were
not conducting any viable enterprise. By virtue of the merger, we acquired the
business of AuTologous Wound Therapy. We are continuing this business, which
involves the development, marketing and sale of a proprietary system, known as
the AuTolo-Cure(TM) System, for the treatment of chronic, non-healing wounds.
The AuTolo-Cure(TM) System is based upon the use of a process for the
application of an autologous platelet-rich concentrated gel, known as
AuTolo-Gel(TM), to chronic, non-healing wounds. To date, we have realized
minimal revenues from the sale and licensing of the AuTolo-Cure(TM) System.
Since the inception of our predecessor, we have been engaged in extensive
research and testing of AuTolo-Gel(TM) and the development of the
AuTolo-Cure(TM) System. Our current activities include:

8
<PAGE>

1. Research and testing of AuTolo-Gel(TM).

2. Development of testing results and case studies.

3. Development and negotiation of licensing agreements.

4. Filing patent and trademark applications with the relevant government
agencies.

5. Raising working capital.

6. Development of our marketing plan and distribution methods.

7. Recruiting key management and sales representatives.

8. Development of reimbursement and third party payor strategies.

9. Development of AuTolo-Cure treatment packs and packaging.

For the next twelve months, we plan to continue to engage in the
activities enumerated above. We also intend to evaluate and pursue a broader
range of opportunities in cellular therapy and molecular biotechnology markets,
beyond our existing autologous treatments for chronic, non-healing wounds. We
expect to incur additional costs for the continued development of the
AuTolo-Cure(TM) System, legal and professional fees for licensing, patent and
trademark services, streamlining and rationalizing existing operations, and to
expand the promotion and marketing of AuTolo-Gel(TM) and the AuTolo-Cure(TM)
System. Management believes that the working capital described under the caption
"Liquidity and Capital Resources" below, and the collection of fees from the
initial licensing fees and sales of the AuTolo-Cure treatment packs, will be
sufficient to meet our operating needs for the next twelve months.

We do not anticipate any significant purchases or sales of plant or
significant equipment. While in the past we leased the sequestration machines
provided to licensees of the AuTolo-Cure(TM) System, we intend to require future
licensees of our AuTolo-Cure(TM) System to purchase the sequestration machines
directly from third-party manufacturers. In the event that we are unable to
impose such requirement on the licensees, or if we can no longer obtain our own
leasing agreements and are required to purchase the machines, our need for
working capital to fund the acquisition of these machines could increase.
However, because we now intend to require future licensees of the
AuTolo-Cure(TM) System to purchase the sequestration machines directly from
third-party manufacturers, we anticipate that we will not need significant
working capital for leases or purchases of the sequestration machines.

We currently have 19 employees and anticipate adding seven employees to
our staff. Five of the new employees will be site implementation personnel hired
to install and train a licensee's personnel in connection with the use of the
AuTolo-Cure(TM) System at the licensee's location, and the remaining two
employees will provide administrative support at the headquarters of Cytomedix.
The timing of the hiring of such site implementation personnel will be based
upon licensing activities and on an as needed basis. The working capital to fund
the cost of the site implementation teams would be provided from the initial
licensing fees paid by the licensees and is a variable cost to us.

The potential market response to the AuTolo-Cure(TM) System and the
timing of our receipt of the patents necessary to conduct our business could
significantly increase demands on our personnel and resources. While most of the
expenses relating to the AuTolo-Cure(TM) System and the sale of the treatment
packs are variable costs based on demand, we could require significant
additional working capital if the response to our product is as anticipated, our
pending patent applications are granted, and third party reimbursement is
obtained for the AuTolo-Cure (TM) System treatment.

9
<PAGE>

RESULTS OF OPERATIONS

This discussion and analysis of our results of operations utilizes our
financial statements which, for the period prior to November 4, 1999, are those
of AuTologous Wound Therapy, Inc., since the merger that occurred as of that
date has been treated as a recapitalization for accounting purposes, and not as
a business combination.

We are a development stage company as defined in Statement of Financial
Accounting Standards No. 7 and had only limited operations through March 31,
2000. Our main activities during this start-up phase have consisted of
recruiting and hiring a new management team and corresponding personnel, as well
as the development of the licensing strategy for, and market expansion of, our
AuTolo-Cure(TM) System. We generated minimal revenues from inception through
March 31, 2000, and recognized $34,504 of revenues during the three-month period
ended March 31, 2000.

Our net loss to common stockholders for the three months ended March
31, 2000 was $6,491,408, as compared to a net loss of $268,576 for the same
period in 1999. The increase in the net loss in 2000 compared to 1999 was
primarily due to higher consulting expenses, $5,573,500 of which was from
non-cash costs incurred from the issuance of stock and options to acquire our
common stock, and higher salaries, professional fees, and other general and
administrative expenses.

Our net sales for the three months ended March 31, 2000 were $34,504,
as compared to $1,100 for the same period in 1999. The increase in revenue in
the 2000 compared to 1999 was due to our entering into three license agreements,
which were not in effect during 1999.

Our general and administrative expenses for the three months ended
March 31, 2000, were $199,262 compared to $52,121 for the same period in 1999.
The increase was primarily due to an increase in most components of our general
and administrative expenses, such as rent, insurance, utilities, supplies,
marketing and travel.

Our compensation expense for the three months ended March 31, 2000
was approximately $434,178, as compared to $217,555 for the same period in 1999.
The increase in the compensation expense in 2000 compared to 1999 was primarily
due to our employment of additional personnel. We expect compensation expense to
grow as we amortize our deferred compensation and retain additional employees to
help us with administrative, marketing and support efforts as we continue to
grow our business. In March 2000 we granted 1,773,440 options (including
anti-dilutive options issued) to our new executives with an exercise price of
$7.00, which was less than the fair market value of our common stock on that
date. Consequently, we recorded deferred compensation expense for the difference
between the stock purchase price and the fair market value of our common stock
on the date of this grant. As of March 31, 2000 we had deferred approximately
$19,713,000 of compensation expense. We expect to amortize this deferral into
stock based compensation expense as follows: $6,030,182 in 2000, $6,892,747 in
2001 and $6,790,310 in 2002. As of March 31, 2000 we have deferred approximately
$4,583,000 of consulting fees which will be amortized ratably to expense through
September 2004.

Our consulting expenses for the three months ended March 31, 2000 were
approximately $5,668,023, as compared to $0 for the same period in 1999. The
increase in the consulting expenses in 2000 compared to 1999 was primarily due
to the costs incurred from the issuance of stock and options to acquire our
common stock, which amounted to $5,573,500 in the three months ended March 31,
2000. These expenses were mainly related to services provided to us in the areas
of marketing, investor relations and management placement.

During the three-month period ended March 31, 2000, we incurred
professional fees of approximately $196,004, as compared to $0 for the same
period in 1999. The increase in the professional fees in 2000 compared to 1999
was primarily due to an increase in legal and accounting fees.

Our interest income for the three months ended March 31, 2000, was
$19,795 compared to $0 for the three months ended March 31, 1999. This change
was primarily due to an increase of cash.

<PAGE>

LIQUIDITY AND CAPITAL RESOURCES

As of the date of this report, we have not generated positive cash flow
from our operations. This is primarily due to the start-up nature of our
operations, investment in development and testing of AuTolo-Gel(TM) and building
of a corporate infrastructure to support our future operations. During the first
quarter of 2000, we raised capital through private placements of our common
stock.

At March 31, 2000, we had cash and cash equivalents of approximately
$7,400,000. Working capital at March 31, 2000 was approximately $7,000,000. For
the three months ended March 31, 2000, we invested approximately $145,000 in
capital and leasehold improvements. These expenditures represent, primarily,
additional investment in program medical equipment and office furniture and
equipment.

In February 2000, we issued an aggregate of 250,000 shares of our
common stock to one accredited investor at a purchase price of $3.00 per share,
in a private placement pursuant to Rule 506 of Regulation D under the Securities
Act of 1933, as amended. We received gross cash proceeds from this placement of
$750,000, from which we paid aggregate advisory and placement fees of $75,000 to
SPH Investments, Inc. and LCP Capital Corporation.

In March 2000, we issued an aggregate of 771,500 shares of our
common stock to 31 accredited investors at a purchase price of $10.00 per share,
in a private placement pursuant to Rule 506 of Regulation D under the Securities
Act. We received gross proceeds from this placement of $7,715,000, from which we
paid aggregate advisory and placement fees of $441,267, and issued 10,000 shares
of our common stock and warrants representing the right to purchase 26,500
shares of common stock at $10.00 per share as additional placement fees. See
Notes 2 and 3 to the condensed financial statements included in Item 1 of Part I
of this report.

We believe that the working capital provided by the February and March
2000 private placements and the collections generated from the initial licensing
fees and sales of the AuTolo-Cure (TM) System treatment packs will be sufficient
to meet our operating needs and capital requirements for at least the next 12
months. There can be no assurance, however, that we will achieve profitability
in the near future. The continuation of our operating losses, together with the
risks associated with our ability to gain new client contracts, the sale of
disposable packs under existing contracts and other changes in our operating
assets and liabilities, may have a material adverse effect on our liquidity. In
this regard, we may need to raise additional capital in the foreseeable future
by way of equity or debt offerings in order to implement our business, sales or
marketing plans, and take advantage of opportunities that may present themselves
in the future, such as more rapid expansion, acquisitions of or partnerships
with complementary businesses. We may also need to respond to unforeseen
difficulties, such as the decrease in demand for our products and services,
meeting applicable regulatory requirements, or the timing of revenues due to a
variety of factors previously discussed. We may otherwise have to react to
unanticipated competitive or other market pressures. The need to raise
additional working capital may require us to delay, curtail or terminate some of
our development and clinical testing, sales and marketing efforts and could
otherwise have a material adverse effect on our operations. An additional equity
financing required in such event may involve a significant dilution to the
holdings of our shareholders.

11
<PAGE>

PART II
OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

None

ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS

For a complete discussion of the private placements of our common stock
during the first quarter of 2000, please see "Liquidity and Capital Resources"
under Item 2 of Part I of this report. Other issuances of unregistered options
and warrants are described in notes 2, 3 and 4 to the condensed financial
statements included in Item 1 of Part I of this report.

We plan to use the proceeds from the above private placements to fund our
operating needs, product development and clinical testing, sales and marketing
efforts, and for general corporate purposes.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

During the three months ended March 31, 2000, we solicited consent of our
shareholders to the filing of a Certificate of Amendment to our Certificate of
Incorporation that would change our name from AuTologous Wound Therapy, Inc. to
Cytomedix, Inc. A copy of the Certificate of Amendment to Certificate of
Incorporation, as filed with the Secretary of State of the State of Delaware on
March 30, 2000, was made an exhibit to the Form 8-K discussed below under Item
6(b) of this report. This action was approved by shareholders consent by written
action in lieu of a meeting by shareholders representing more than 50 percent
of our issued and outstanding stock.

ITEM 5. OTHER INFORMATION

We wish to report certain information with respect to a change in our
senior management. Our press release announcing the change in management, dated
April 6, 2000, is attached hereto as Exhibit 99.1 and is incorporated by
reference in its entirety.

On April 14, 2000, we appointed Mr. James A. Cour to our Board of
Directors, and to serve as our President and Chief Executive Officer. Prior to
joining us, Mr. Cour served in a variety of management positions at Baxter
International Inc.

In addition, on April 14, 2000, we appointed Dr. Robin L. Geller to serve
as our Vice President of Science and Technology. Before this appointment, Dr.
Geller served in a variety of technical positions at Baxter Healthcare
Corporation since 1993, most recently serving as Associate Director of
Regulatory and Clinical Affairs. Prior to her Baxter employment, she was a
member of the faculty of the University of Minnesota in the departments of
Laboratory Medicine & Pathology and Pediatrics, where she also conducted
post-doctoral research in cellular immunology.

Further, on April 14, 2000, we appointed Mr. Christopher J. Caywood to
serve as our Vice President of Strategy & Business Development. Mr. Caywood has
been with Baxter International Inc. since 1998, where he worked as Director of
Business Planning and Development, and prior to that, Mr. Caywood was employed
in various financial and legal capacities by Sears, Roebuck and Co.

12
<PAGE>

Further, on April 14, 2000, we appointed Mr. David C. Demarest to serve
as our Vice President, General Counsel and Corporate Secretary. Mr. Demarest
practiced law with the firm of Preston, Gates & Ellis, LLP during the past three
years, where he specialized in biotechnology, pharmaceutical transactions,
high-technology research and development projects, and corporate transactional
matters. During the previous fourteen years, Mr. Demarest served as in-house
counsel for Baxter World Trade Corporation in a variety of expatriate
assignments.

Also, on April 13, 2000, William Brown and W. Michael Chunn resigned as
our Chief Operating Officer and Vice President of Technical Operations,
respectively. In addition, on April 17, 2000, Dennis Hendren resigned as our
President and Chief Executive Officer. These three individuals simultaneously
resigned as members of our Board of Directors. They did not have any
disagreement with our operating policies or practices.

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

(a) Exhibits

Exhibit
Number Description
------- -----------

10.1 Securities Purchase Agreement, dated as of January 25, 2000,
between AuTologous Wound Therapy, Inc. and Lancer Offshore,
Inc.

10.2 Form of Securities Purchase Agreement, dated as of March 1,
2000, among AuTologous Wound Therapy, Inc. and the investor
parties thereto

10.3 Consulting Agreement, dated as of January 12, 2000, between
AuTologous Wound Therapy, Inc. and The Kriegsman Group

10.4 First Amendment to Consulting Agreement, dated as of
February 22, 2000, between AuTologous Wound Therapy, Inc. and
The Kriegsman Group

10.5 Employment Agreement, dated as of March 3, 2000, between
AuTologous Wound Therapy, Inc. and James A. Cour

10.6 Employment Agreement, dated as of March 3, 2000, between
AuTologous Wound Therapy, Inc. and Robin L. Geller

10.7 Employment Agreement, dated as of March 3, 2000, between
AuTologous Wound Therapy, Inc. and Christopher J. Caywood

10.8 Employment Agreement, dated as of March 3, 2000, between
AuTologous Wound Therapy, Inc. and David C. Demarest

10.9 Lease, dated as of April 19, 2000, between Cytomedix, Inc. and
CarrAmerica Realty Corporation

99.1 Press Release, dated April 6, 2000

27 Financial Data Schedule

(b) Reports on Form 8-K

On April 4, 2000, we filed the following report on Form 8-K describing
a change of our name and completion of a private placement of our
common stock to certain investors.

Summary

On March 30, 2000, we filed a Certificate of Amendment to our
Certificate of Incorporation changing our name from AuTologous Wound Therapy,
Inc. to Cytomedix, Inc., so as to more accurately reflect our management's
intention to pursue diverse opportunities in cellular therapy and molecular
biotechnology markets. This change was approved by shareholder consent by
written action in lieu of a meeting by shareholders representing more than fifty
percent of our issued and outstanding voting common stock.

13
<PAGE>

In March 2000, we also completed a private placement of our common
stock to 31 accredited investors, at the purchase price of $10.00 per share, and
raised $7,715,000 in gross proceeds to be used for working capital and general
corporate purposes. We paid advisory fees of $212,000, and issued stock options
to acquire 26,500 shares at an exercise price of $10.00 per share, to The
Kriegsman Group for services relating to this offering. In addition, placement
fees of approximately $230,000 were paid, and 10,000 shares of our common stock
were issued, as a fee to other placement agents in connection with the offering.

SIGNATURES

In accordance with the requirements of the Securities Exchange Act of
1934, the registrant has caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.

CYTOMEDIX, INC.

Dated: May 12, 2000 /s/ James A. Cour
--------------------------------------------
James A. Cour
President and Chief Executive Officer
(Principal Executive Officer)

Dated: May 12, 2000 /s/ Glenn M. Charlesworth
--------------------------------------------
Glenn M. Charlesworth
Chief Financial Officer
(Principal Financial and Accounting Officer)

14
<PAGE>

EXHIBIT LIST

10.1 Securities Purchase Agreement, dated as of January 25, 2000,
between AuTologous Wound Therapy, Inc. and Lancer Offshore,
Inc.

10.2 Form of Securities Purchase Agreement, dated as of March 1,
2000, among AuTologous Wound Therapy, Inc. and the investor
parties thereto

10.3 Consulting Agreement, dated as of January 12, 2000, between
AuTologous Wound Therapy, Inc. and The Kriegsman Group

10.4 First Amendment to Consulting Agreement, dated as of February
22, 2000, between AuTologous Wound Therapy, Inc. and The
Kriegsman Group

10.5 Employment Agreement, dated as of March 3, 2000, between
AuTologous Wound Therapy, Inc. and James A. Cour

10.6 Employment Agreement, dated as of March 3, 2000, between
AuTologous Wound Therapy, Inc. and Robin L. Geller

10.7 Employment Agreement, dated as of March 3, 2000, between
AuTologous Wound Therapy, Inc. and Christopher J. Caywood

10.8 Employment Agreement, dated as of March 3, 2000, between
AuTologous Wound Therapy, Inc. and David C. Demarest

10.9 Lease, dated as of April 19, 2000, between Cytomedix, Inc. and
CarrAmerica Capital Corporation

99.1 Press Release, dated April 6, 2000

27 Financial Data Schedule

<PAGE>

Exhibit 10.1

AUTOLOGOUS WOUND THERAPY, INC.

-------------------------------------------------------------

Securities Purchase Agreement

-------------------------------------------------------------

Shares of Common Stock
offered at $3.00 per share

-------------------------------------------------------------

January 25, 2000

<PAGE>

SECURITIES PURCHASE AGREEMENT

THIS SECURITIES PURCHASE AGREEMENT (the "Agreement") is entered into as
of the day and year appearing on the signature page hereof by and between
AuTologous Wound Therapy, Inc., a Delaware corporation ("AuTologous" or the
"Company"), and the investor whose name appears at the end of this Agreement
(the "Purchaser").

R E C I T A L S:

In order to conform with the Plan of Reorganization between AuTologous
Wound Therapy, Inc. and Informatix, Inc., the Company wishes to issue, and the
Purchaser wishes to purchase shares of the Company's common stock, $3.00 par
value per share (the "Common Stock").

NOW, THEREFORE, in consideration of the premises hereof and the
agreements set forth herein below, the parties hereto hereby agree as follows:

1. Sale and Purchase of Shares.

(a) Subject to the terms and conditions hereof, on the date of
the Closing, as defined in Section 3 hereof, the Company agrees to issue and
sell, and the Purchaser agrees to purchase, that number of shares of Common
Stock as are indicated on the last page of this Agreement at a purchase price of
$3.00 per share (the "Shares").

(b) Restricted Securities. The shares of Common Stock of the
Company that are being offered hereby are "restricted securities" as that term
is defined under Rule 144 of the Securities Act of 1933, as amended (the "Act"),
and, accordingly, may not be offered for sale or sold or otherwise transferred
in a transaction which would constitute a sale thereof within the meaning of the
Act unless: (i) such security has been registered for sale under the Act and
registered or qualified under applicable state securities laws relating to the
offer and sale of securities; or (ii) exemptions from the registration
requirements of the Act and the registration or qualification requirements of
all such state securities laws are available and the Company shall have received
an opinion of counsel that the proposed sale or other disposition of such
securities may be effected without registration under the Act and would not
result in any violation of any applicable state securities laws relating to the
registration or qualification of securities for sale, such counsel and such
opinion to be satisfactory to the Company. As restricted securities, the resale
of the shares of Common Stock is subject to significant restrictions upon
resale. See Section 7 hereafter, "Understanding of Investment Risks."

(c) Voting Rights; Dividends. Holders of Common Stock of the
Company have equal rights to receive dividends when, as, and if declared by the
Board of Directors out of funds legally available therefor. Holders of Common
Stock of the Company have one vote for each share held of record and do not have
cumulative voting rights.

<PAGE>

(d) Liquidation; Redemption. Holders of Common Stock of the
Company are entitled upon liquidation of the Company to share ratably in the net
assets available for distribution, subject to the rights, if any, of holders of
any preferred stock of the Company then outstanding. Shares of Common Stock of
the Company are not redeemable and have no preemptive or similar rights. All
outstanding shares of common stock of the Company are fully paid and
nonassessable.

2. Shares Offered in a Private Placement Transaction.

(a) The Shares offered by this Securities Purchase Agreement
are to be offered as part of a private placement transaction pursuant to Section
4(2) and Rule 506 of Regulation D of the Act (the "Offering") by the Company on
a "best efforts" basis of up to 250,000 shares of Common Stock to be offered to
a number of sophisticated and accredited investors. Accordingly, as of the date
hereof, there can be no assurances as to the number of shares of Common Stock
that will be sold in the Offering. The Company reserves the right to increase
the number of shares of Common Stock sold without notice to or consent of the
subscribers or existing Company stockholders.

(b) The shares of Common Stock are being offered to a limited
number of accredited and other sophisticated investors by the Company directly,
without sales commission.

(d) The Offering will generally be maintained by the Company
until the earlier of: (i) the sale of all of the shares of Common Stock offered
pursuant to such Securities Purchase Agreements (or such greater number of
shares as the Company elects to offer); or (ii) such date that the Company
chooses to terminate the Offering (hereinafter the "Offering Period").

3. Binding Effect of Securities Purchase Agreement; The Closing.

(a) This Securities Purchase Agreement shall not be binding on
the Company unless and until the Company has accepted the offer represented by
an executed signature page at the end hereof. The Company may accept or reject
this Securities Purchase Agreement in the Company's sole discretion, if the
Purchaser does not meet the suitability standards established herein or for any
other reason. In the event the Company rejects this Agreement, the Purchaser's
funds will be promptly returned without deduction of any costs and without
interest.

(b) The closing of the purchase and sale of the Shares
hereunder (the "Closing") shall occur concurrently upon acceptance by the
Company of this Securities Purchase Agreement and deposit with the Company of
funds representing the Purchase Price. Notwithstanding the above, the Company
reserves the right to reject a subscription within ten (10) days of receipt of
the Purchase Price should the Company determine during that period that

2
<PAGE>

the Purchaser does not satisfy the subscriber qualifications or suitability
standards established hereafter.

4. Deliveries by the Company. Within ten (10) days after the Closing,
the Company shall deliver to the Purchaser a stock certificate bearing
applicable restrictive legends, duly executed by the appropriate officer (s) and
registered in Purchaser's name or its nominee.

5. Representations and Warranties of the Purchaser. The Purchaser
represents and warrants to the Company as follows:

(a) Accredited Investor. The Purchaser has such knowledge and
experience in business and financial matters such that the Purchaser is capable
of evaluating the merits and risks of purchasing the Shares. The Purchaser is an
"accredited investor" as that term is defined in Rule 501 of Regulation D of the
Act and represents that he satisfies the suitability standards identified in
Section 9 hereof;

(b) Loss of Investment. The Purchaser's (i) overall commitment
to investments which are not readily marketable is not disproportionate to his
net worth; (ii) investment in the Company will not cause such overall commitment
to become excessive; (iii) can afford to bear the loss of his entire investment
in the Company; and (iv) has adequate means of providing for his current needs
and personal contingencies and has no need for liquidity in his investment in
the Company;

(c) Special Suitability. The Purchaser satisfies any special
suitability or other applicable requirements of his state of residence and/or
the state in which the transaction by which the Shares are purchased occurs;

(d) Investment Intent.

(i) the Purchaser hereby acknowledges that the Purchaser
has been advised that this offering has not been registered with, or reviewed
by, the Securities and Exchange Commission ("SEC") because this offering is
intended to be a non-public offering pursuant to Section 4(2) and Rule 506 of
Regulation D of the Act. The Purchaser represents that the Shares are being
purchased for the Purchaser's own account and not on behalf of any other person,
for investment purposes only and not with a view towards distribution or resale
to others. The Purchaser agrees that the Purchaser will not attempt to sell,
transfer, assign, pledge or otherwise dispose of all or any portion of the
Shares unless they are registered under the Act or unless in the opinion of
counsel an exemption from such registration is available, such counsel and such
opinion to be satisfactory to the Company. The Purchaser understands that the
Shares have not been registered under the Act by reason of a claimed exemption
under the provisions of the Act which depends, in part, upon the Purchaser's
investment intention; and

(ii) the Shares and any certificates issued in replacement
therefor shall bear the following legend, in addition to any other legend
required by law or otherwise:

3
<PAGE>

"THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. THE
SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE BEEN TAKEN BY
THE REGISTERED OWNER FOR INVESTMENT, AND WITHOUT A VIEW TO
RESALE OR DISTRIBUTION THEREOF, AND MAY NOT BE TRANSFERRED OR
DISPOSED OF WITHOUT AN OPINION OF COUNSEL SATISFACTORY TO THE
ISSUER THAT SUCH TRANSFER OR DISPOSITION DOES NOT VIOLATE THE
SECURITIES ACT OF 1933, AS AMENDED, OR THE RULES AND
REGULATIONS THEREUNDER."

(e) State Securities Laws. The Purchaser understands that no
securities administrator of any state has made any finding or determination
relating to the fairness of this investment and that no securities administrator
of any state has recommended or endorsed, or will recommend or endorse, the
offering of the Shares;

(f) Authority; Power; No Conflict. The execution, delivery and
performance by the Purchaser of the Agreement are within the powers of the
Purchaser, have been duly authorized and will not constitute or result in a
breach or default under, or conflict with, any order, ruling or regulation of
any court or other tribunal or of any governmental commission or agency, or any
agreement or other undertaking, to which the Purchaser is a party or by which
the Purchaser is bound, and, if the Purchaser is not an individual, will not
violate any provision of the charter documents, By-Laws, indenture of trust or
partnership agreement, as applicable, of the Purchaser. The signatures on the
Agreement are genuine, and the signatory, if the Purchaser is an individual, has
legal competence and capacity to execute the same, or, if the Purchaser is not
an individual, the signatory has been duly authorized to execute the same; and
the Agreement constitutes the legal, valid and binding obligations of the
Purchaser, enforceable in accordance with its terms;

(g) No General Solicitation. The Purchaser acknowledges that
no general solicitation or general advertising (including communications
published in any newspaper, magazine or other broadcast) has been received by
him and that no public solicitation or advertisement with respect to the
offering of the Shares has been made to him;

(h) Advice of Tax and Legal Advisors. The Purchaser has relied
solely upon the advice of its own tax and legal advisors with respect to the tax
and other legal aspects of this investment; and

(i) Access to Information. The Purchaser has had access to all
material and relevant information concerning the Company, its management,
financial condition, capitalization, market information, properties and
prospects necessary to enable Purchaser to make an informed investment decision
with respect to its investment in the Shares. Purchaser has carefully read and
reviewed, and is familiar with and understands the contents thereof and

4
<PAGE>

hereof, including, without limitation, the risk factors described in this
Agreement. See "UNDERSTANDING OF INVESTMENT RISKS." Purchaser acknowledges that
it has had the opportunity to ask questions of and receive answers from, and to
obtain additional information from, representatives of the Company concerning
the terms and conditions of the acquisition of the Shares and the present and
proposed business and financial condition of the Company, and has had all such
questions answered to its satisfaction and has been supplied all information
requested.

6. Understanding of Investment Risks. An investment in the Shares
should not be made by a Purchaser who cannot afford the loss of its entire
Purchase Price. THE PURCHASER ACKNOWLEDGES THAT THE SHARES OFFERED HEREBY HAVE
NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION, OR
ANY STATE SECURITIES COMMISSIONS, NOR HAS THE SECURITIES AND EXCHANGE COMMISSION
OR ANY STATE SECURITIES COMMISSION PASSED UPON THE ADEQUACY OR ACCURACY OF THIS
SECURITIES PURCHASE AGREEMENT OR ANY EXHIBIT HERETO. An investment in the Shares
should not be made until the Purchaser has considered the following risk
factors:

(a) Arbitrary Offering Price. The price of the Shares offered
hereby has been arbitrarily determined by the Company without the benefit of an
arm's-length negotiation and is not based upon generally-recognized criteria,
such as earnings, price per share, net book value, etc. There can be no
assurances that the offering price is representative of the actual value of the
Shares.

(b) Dividends. The payment of dividends by the Company is not
contemplated in the foreseeable future. Earnings, if any, are expected to be
retained to finance and develop the business of the Company.

(c) Registration Rights; Restrictions Upon Resale. The Shares
have not been registered under the Act or any state securities or blue-sky law
and subscribers may not sell or otherwise transfer such securities except
pursuant to registration under the Act and any applicable state securities laws
or exemptions therefrom. Because of such restrictions, a subscriber for the
Shares must bear the economic risks of such investment for an indefinite period
of time.

(d) No Public Market. Although the Company's Common Stock is
eligible for trading on the OTC "pink sheets", there is currently no public
trading market for the Common Stock. There can be no assurances that a regular
trading market will ever develop for the Common Stock of the Company.

(e) Additional Dilution. Pursuant to the Agreement and Plan of
Reorganization between the Company and Informatix, Inc., the Company is required
to raise an additional $750,000 through the sale of additional securities. Any
future offerings may have a significantly dilutive effect on the Purchaser's
interest in the Company.

5
<PAGE>

7. Representations and Warranties of the Company. The Company hereby
represents and warrants to Purchaser as follows:

(a) Organization and Standing of the Company. The Company is a
duly organized and validly existing corporation in good standing under the laws
of the State of Delaware with adequate power and authority to conduct the
business in which it is now engaged and has the corporate power and authority to
enter into this Agreement, and is duly qualified and licensed to do business as
a foreign corporation in such other states or jurisdictions as is necessary to
enable it to carry on its business, except where failure to do so would not have
a material adverse effect on its business;

(b) Corporate Power and Authority. The execution and delivery
of this Agreement and the transactions contemplated hereby have been duly
authorized by the Board of Directors of the Company. No other corporate act or
proceeding on the part of the Company is necessary to authorize this Agreement
or the consummation of the transactions contemplated hereby. When duly executed
and delivered by the parties hereto, this Agreement will constitute a valid and
legally binding obligation of the Company enforceable against it in accordance
with its terms, except as such enforceability may be limited by (i) bankruptcy,
insolvency, moratorium, reorganization or other similar laws and legal and
equitable principles limiting or affecting the rights of creditors generally;
and/or (ii) general principles of equity, regardless of whether considered in a
proceeding in equity or at law;

(c) Noncontravention. The execution and delivery of this
Agreement and the consummation of the transactions contemplated hereby will not,
to the best of the Company's knowledge and belief, (i) permit the termination or
acceleration of the maturity of any material indebtedness or material obligation
of the Company; (ii) permit the termination of any material note, mortgage,
indenture, license, agreement, contract, or other instrument to which the
Company is a party or by which it is bound or the Certificate of Incorporation
or By-Laws of the Company; (iii) except as expressly provided in this Agreement
and except for state "blue sky" approvals that may be required and those
consents and waivers which already have been obtained by the Company, require
the consent, approval, waiver or authorization from or registration or filing
with any party, including but not limited to any party to a material agreement
to which the Company is a party or by which it is bound, or any regulatory or
governmental agency, body or entity except where failure to obtain such consent,
approval, waiver or authorization would not have a material adverse effect on
the Company's business; (iv) result in the creation or imposition of any lien,
claim or encumbrance of any kind or nature on any material properties or assets
of the Company; or (v) violate in any material aspect any statute, law, rule,
regulation or ordinance, or any judgment, decree, order, regulation or rule of
any court, tribunal, administrative or governmental agency, body or entity to
which the Company or its properties is subject except where such violation would
not have a material adverse effect on the Company's business; and

(d) Reservation of Securities. The requisite number of shares
of Common Stock of the Company have been duly authorized and reserved for
issuance upon the Company's receipt and acceptance of payment therefore, and no
further corporate action is required for the valid issuance of such Shares.

6
<PAGE>

8. IMPORTANT CONSIDERATIONS: SUITABILITY STANDARDS - WHO SHOULD
INVEST.

INVESTMENT IN THE SHARES INVOLVES A HIGH DEGREE OF RISK AND IS
SUITABLE ONLY FOR PERSONS OF SUBSTANTIAL FINANCIAL RESOURCES WHO HAVE NO NEED
FOR LIQUIDITY IN THEIR INVESTMENT.

A substantial number of state securities commissions have
established investor suitability standards for the marketing within their
respective jurisdictions of restricted securities. Some have also established
minimum dollar levels for purchases in their states. The reasons for these
standards appear to be, among others, the relative lack of liquidity of
securities of such programs as compared with other securities investments.
Investment in the Shares involves a high degree of risk and is suitable only for
persons of substantial financial means who have no need for liquidity in their
investments.

The Company has adopted as a general investor suitability
standard the requirement that each Purchaser of Shares represents in writing
that he: (a) is acquiring the Shares for investment and not with a view to
resale or distribution; (b) can bear the economic risk of losing his entire
investment; (c) his overall commitment to investments which are not readily
marketable is not disproportionate to his net worth, and an investment in the
Shares will not cause such overall commitment to become excessive; (d) has
adequate means of providing for his current needs and personal contingencies and
has no need for liquidity in this investment in the Shares; (e) has evaluated
all the risks of investment in the Company; and (f) has such knowledge and
experience in financial and business matters as to be capable of evaluating the
merits and risks of investing in the Company or is relying on his own purchaser
representative, in making an investment decision.

In addition, each of the Subscribers for Shares must be: (1) a
sophisticated investor with substantial net worth and experience in making
investments of this nature; and (2) an "accredited investor," as defined in Rule
501 of Regulation D under the Act, by meeting any of the following conditions:

(i) he has an individual income in excess of $200,000 in each
of the two most recent years or joint income with his spouse in excess of
$300,000 in each of those years, and he reasonably expects an income in excess
of the aforesaid levels in the current year, or

(ii) he has an individual net worth, or a joint net worth with
his spouse, at the time of his purchase, in excess of $1,000,000 (net worth for
these purposes includes homes, home furnishings and automobiles), or

(iii) he otherwise satisfies the Company that he is an
accredited investor, as defined in Rule 501 under the Act.

7
<PAGE>

investment companies; business development companies (as defined under the
Investment Company Act of 1940); Small Business Investment Companies licensed by
the Small Business Administration; certain employee benefit plans; private
business development companies (as defined in the Investment Advisers Act of
1940); tax exempt organizations (as defined in Section 501(c)(3) of the Internal
Revenue Code) with total assets in excess of $5,000,000; entities in which all
the equity owners are accredited investors; and certain affiliates of the
Company.

A partnership subscriber, which satisfies the requirements set
forth in clauses (a) through (f) above shall satisfy the suitability standards
if it is an accredited investor by reason of clause (iii) above, or if all of
its partners are accredited investors. A corporate subscriber, which satisfies
the requirements set forth in clauses (a) through (f) above shall satisfy the
investor suitability standards if it is an accredited investor by reason of
clause (iii) above, or if all of its shareholders are accredited investors.
Corporate subscribers must have net worth of at least three (3) times the amount
of their investment in the Shares.

The suitability standards referred to above represent minimum
suitability requirements for prospective purchasers and the satisfaction of such
standards by a prospective purchaser does not necessarily mean that the Shares
are a suitable investment for such purchaser. The Company may, in circumstances
it deems appropriate, modify such requirements. The Company may also reject
subscriptions for whatever reasons, in its sole discretion, it deems
appropriate.

A Purchaser who is a resident of certain state may be required
to meet certain additional suitability standards.

THE ACCEPTANCE OF A SUBSCRIPTION FOR SHARES BY THE COMPANY
DOES NOT CONSTITUTE A DETERMINATION BY THE COMPANY THAT AN INVESTMENT IN THE
SHARES IS SUITABLE FOR A PROSPECTIVE PURCHASER. THE FINAL DETERMINATION OF THE
SUITABILITY OF INVESTMENT IN THE SHARES MUST BE MADE BY THE PROSPECTIVE
PURCHASER AND HIS ADVISERS.

9. State Law Considerations.

IN MAKING AN INVESTMENT DECISION, THE PURCHASER MUST RELY ON
HIS OWN EXAMINATION OF THE ISSUER AND THE TERMS OF THE OFFERING, INCLUDING THE
MERITS AND RISKS INVOLVED. THESE SHARES HAVE NOT BEEN RECOMMENDED BY ANY FEDERAL
OR STATE SECURITIES COMMISSION OR REGULATORY AUTHORITY. FURTHERMORE, THE
FOREGOING AUTHORITIES HAVE NOT CONFIRMED THE ACCURACY OR DETERMINED THE ADEQUACY
OF THE DESCRIPTION OF BUSINESS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.

THESE SECURITIES ARE SUBJECT TO RESTRICTIONS ON
TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS
PERMITTED UNDER THE SECURITIES ACT AND THE APPLICABLE STATE SECURITIES LAWS,
PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM. INVESTORS SHOULD BE AWARE THAT
THEY WILL BE REQUIRED TO BEAR THE FINANCIAL RISKS OF THIS INVESTMENT FOR AN
INDEFINITE PERIOD OF TIME.

8
<PAGE>

10. Notices. All notices, requests, consents or other communications
required or permitted hereunder shall be in writing and shall be hand delivered
or mailed first class postage prepaid, registered or certified mail, to the
following addresses:

If to the Company:

Autologous Wound Therapy, Inc.
1520 Bowman Road, Suite A
Little Rock, AR 72211

With a copy to:

Price Gardner, Esquire
Friday, Eldridge & Clark
400 West Capitol Avenue, Suite 2000
Little Rock, AR 72201

In the case of Purchaser:

To the address set forth at the end of this Agreement or to
such other addresses as may be specified in accordance herewith from time to
time.

Unless specified otherwise, such notices and other
communications shall for all purposes of this Agreement be treated as being
effective upon being delivered personally or, if sent by mail, five days after
the same has been deposited in a regularly maintained receptacle for the deposit
of United States mail, addressed as set forth above, and postage prepaid.

11. Survival of Representations and Warranties. Representations and
warranties contained herein shall survive the execution and delivery of this
Agreement.

12. Parties in Interest. All the terms and provisions of this Agreement
shall be binding upon and inure to the benefit of and be enforceable by the
respective successors and permitted assigns of the parties hereto, provided that
this Agreement and the interests herein may not be assigned by either party
without the express written consent of the other party.

13. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware.

14. Sections and Other Headings. The section and other headings
contained in this Agreement are for the convenience of reference only, do not
constitute part of this Agreement or otherwise affect any of the provisions
hereof.

9
<PAGE>

15. Counterpart and Facsimile Signatures. This Agreement may be signed
in counterparts and all counterparts together shall become effective only when
the counterpart(s) have been executed and delivered by and on behalf of the
Company and the Purchaser. Facsimile signatures to this Agreement shall be
deemed to be original signatures.

10
<PAGE>

IN WITNESS WHEREOF, intending to be legally bound, the parties hereto
have caused this Agreement to be signed by their duly authorized officers.

Purchaser:

By: Lancer Offshore, Inc.

250,000 Shares/at $3.00 /s/ illegible
- ------------------------------------ ------------------------------------
Number and dollar amount Name
of Shares purchased -
Purchase Price Address of Purchaser:

Kaya Flamboyan 9
Curacao, Netherlands Antilles

Social Security Number: n/a

Accredited Investor Certification
---------------------------------
(Place initials on the appropriate line(s))

[ ] (i) I am a natural person who had individual income of more than $200,000
in each of the most recent two years or joint income with my spouse in
excess of $300,000 in each of the most recent two years and reasonably
expect to reach that same income level for the current year ("income",
for purposes hereof, should be computed as follows: individual
adjusted gross income, as reported (or to be reported) on a federal
income tax return, increased by (1) any deduction of long-term capital
gains under section 1202 of the Internal Revenue Code of 1986 (the
"Code"), (2) any deduction for depletion under Section 611 et seq. of
the Code, (3) any exclusion for interest under Section 103 of the Code
and (4) any losses of a partnership as reported on Schedule E of Form
1040);

[ ] (ii) I am a natural person whose individual net worth (i.e., total assets
in excess of total liabilities), or joint net worth with my spouse,
will at the time of purchase of the Shares be in excess of $1,000,000;

[ ] (iii) The Purchaser is a "Qualified Institutional Buyer" as the term is
defined under Rule 144A of the Act.

[ ] (iv) The Purchaser is an investor satisfying the requirements of Section
501(a)(1), (2) or (3) of Regulation D promulgated under the Securities
Act, which includes but is not limited to, a self-directed employee
benefit plan where investment decisions are made solely

11
<PAGE>

by persons who are "accredited investors" as otherwise defined in
Regulation D;

[ ] (v) The Purchaser is a trust, which trust has total assets in excess of
$5,000,000, which is not formed for the specific purpose of acquiring
the Shares offered hereby and whose purchase is directed by a
sophisticated person as described in Rule 506(b)(ii) of Regulation D
and who has such knowledge and experience in financial and business
matters that it is capable of evaluating the risks and merits of an
investment in the Shares;

[ ] (vi) I am a director or executive officer of the Company; or

[X] (vii) The Purchaser is an entity (other than a trust) in which all of the
equity owners meet the requirements of at least one of the above
subparagraphs.

Agreed and Accepted by

AUTOLOGOUS WOUND THERAPY, INC.

By: /s/ Dennis G. Hendren
--------------------------------------
Name: Dennis G. Hendren
Title: President/CEO

DATED: 2-4-00

<PAGE>

Exhibit 10.2

AUTOLOGOUS WOUND THERAPY, INC.

-------------------------------------------------------------

Securities Purchase Agreement

-------------------------------------------------------------

Shares of Common Stock
offered at $10.00 per share

-------------------------------------------------------------

March 1, 2000

<PAGE>

SECURITIES PURCHASE AGREEMENT

R E C I T A L S:

In order to produce additional working capital for the Company, the
Company wishes to issue, and the Purchaser wishes to purchase shares of the
Company's common stock, $.0001 par value per share (the "Common Stock").

NOW, THEREFORE, in consideration of the premises hereof and the
agreements set forth herein below, the parties hereto hereby agree as follows:

1. Sale and Purchase of Shares.

<PAGE>

2. Shares Offered in a Private Placement Transaction.

(a) The Shares offered by this Securities Purchase Agreement
are to be offered as part of a private placement transaction pursuant to Section
4(2) and Rule 506 of Regulation D of the Act (the "Offering") by the Company on
a "best efforts" basis to be offered to a number of sophisticated and accredited
investors. Accordingly, as of the date hereof, there can be no assurances as to
the number of shares of Common Stock that will be sold in the Offering. The
Company reserves the right to increase the number of shares of Common Stock sold
without notice to or consent of the subscribers or existing Company
stockholders.

(b) The shares of Common Stock are being offered to a limited
number of accredited and other sophisticated investors. The Company may utilize
the services of a placement agent in which case, a sales commission will be paid
to the placement agent.

3. Binding Effect of Securities Purchase Agreement; The Closing.

(a) This Securities Purchase Agreement shall not be binding
on the Company unless and until the Company has accepted the offer represented
by an executed signature page at the end hereof. The Company may accept or
reject this Securities Purchase Agreement in the Company's sole discretion, if
the Purchaser does not meet the suitability standards established herein or for
any other reason. In the event the Company rejects this Agreement, the
Purchaser's funds will be promptly returned without deduction of any costs and
without interest.

2
<PAGE>

the Purchaser does not satisfy the subscriber qualifications or suitability
standards established hereafter.

5. Representations and Warranties of the Purchaser. The Purchaser
represents and warrants to the Company as follows:

(d) Investment Intent.

(i) the Purchaser hereby acknowledges that the
Purchaser has been advised that this offering has not been registered with, or
reviewed by, the Securities and Exchange Commission ("SEC") because this
offering is intended to be a non-public offering pursuant to Section 4(2) and
Rule 506 of Regulation D of the Act. The Purchaser represents that the Shares
are being purchased for the Purchaser's own account and not on behalf of any
other person, for investment purposes only and not with a view towards
distribution or resale to others. The Purchaser agrees that the Purchaser will
not attempt to sell, transfer, assign, pledge or otherwise dispose of all or any
portion of the Shares unless they are registered under the Act or unless in the
opinion of counsel an exemption from such registration is available, such
counsel and such opinion to be satisfactory to the Company. The Purchaser
understands that the Shares have not been registered under the Act by reason of
a claimed exemption under the provisions of the Act which depends, in part, upon
the Purchaser's investment intention; and

(ii) the Shares and any certificates issued in
replacement therefor shall bear the following legend, in addition to any other
legend required by law or otherwise:

3
<PAGE>

(h) Advice of Tax and Legal Advisors. The Purchaser has relied
solely upon the advice of its own tax and legal advisors with respect to the tax
and other legal aspects of this investment; and

4
<PAGE>

(b) Dividends. The payment of dividends by the Company is not
contemplated in the foreseeable future. Earnings, if any, are expected to be
retained to finance and develop the business of the Company.

7. Representations and Warranties of the Company. The Company hereby
represents and warrants to Purchaser as follows:

5
<PAGE>

necessary to enable it to carry on its business, except where failure to do
so would not have a material adverse effect on its business;

8. IMPORTANT CONSIDERATIONS: SUITABILITY STANDARDS - WHO SHOULD
INVEST.

INVESTMENT IN THE SHARES INVOLVES A HIGH DEGREE OF RISK AND IS
SUITABLE ONLY FOR PERSONS OF SUBSTANTIAL FINANCIAL RESOURCES WHO HAVE NO NEED
FOR LIQUIDITY IN THEIR INVESTMENT.

6
<PAGE>

(iii) he otherwise satisfies the Company that he is an
accredited investor, as defined in Rule 501 under the Act.

Other categories of investors included within the definition
of accredited investor include the following: certain institutional investors,
including certain banks, whether acting in their individual or fiduciary
capacities; certain insurance companies; federally registered investment
companies; business development companies (as defined under the Investment
Company Act of 1940); Small Business Investment Companies licensed by the Small
Business Administration; certain employee benefit plans; private business
development companies (as defined in the Investment Advisers Act of 1940); tax
exempt organizations (as defined in Section 501(c)(3) of the Internal Revenue
Code) with total assets in excess of $5,000,000; entities in which all the
equity owners are accredited investors; and certain affiliates of the Company.

7
<PAGE>

A Purchaser who is a resident of certain state may be required
to meet certain additional suitability standards.

9. State Law Considerations.

8
<PAGE>

If to the Company:

Autologous Wound Therapy, Inc.
1523 Bowman Road, Suite A
Little Rock, AR 72211

With a copy to:

Price Gardner, Esquire
Friday, Eldridge & Clark
400 West Capitol Avenue, Suite 2000
Little Rock, AR 72201

In the case of Purchaser:

To the address set forth at the end of this Agreement or to
such other addresses as may be specified in accordance herewith from time to
time.

11. Survival of Representations and Warranties. Representations and
warranties contained herein shall survive the execution and delivery of this
Agreement.

13. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware.

9
<PAGE>

IN WITNESS WHEREOF, intending to be legally bound, the parties hereto
have caused this Agreement to be signed by their duly authorized officers.

Purchaser:

By:
--------------------------------

Shares/$
- ------------------------ -----------------------------------
Number and dollar amount Name
of Shares purchased -
Purchase Price Address of Purchaser:

-----------------------------------

Social Security Number:
------------

Accredited Investor Certification
(Place initials on the appropriate line(s))

[ ] (iii) The Purchaser is a "Qualified Institutional Buyer" as the term is
defined under Rule 144A of the Act.

10
<PAGE>

by persons who are "accredited investors" as otherwise defined in
Regulation D;

[ ] (vi) I am a director or executive officer of the Company; or

[ ] (vii) The Purchaser is an entity (other than a trust) in which all of the
equity owners meet the requirements of at least one of the above
subparagraphs.

Agreed and Accepted by

AUTOLOGOUS WOUND THERAPY, INC.

By:
--------------------------------
Name:
Title:

DATED:
-----------------------------

<PAGE>

Exhibit 10.3

CONSULTING AGREEMENT

This Consulting Agreement is executed effective as of the 12th of January,
2000, by and between Autologous Wound Therapy, Inc., a Delaware corporation
("AWT"), and The Kriegsman Group, a sole proprietorship based in California and
owned by Steven Kriegsman, an individual and resident of the State of
California (collectively "Kriegsman").

WITNESSETH:

WHEREAS, AWT desires to engage Kriegsman as a consultant to provide
consulting and advisory services to AWT on the terms and conditions hereinafter
provided; and

WHEREAS, Kriegsman desires to be so engaged by AWT as an independent
contractor, and not as an employee, in order to perform the services subject to
this engagement;

NOW, THEREFORE, in consideration of the mutual promises and covenants
contained herein, and other good and valuable consideration the receipt and
adequacy of which are hereby acknowledged, the parties hereto, intending to be
legally bound, agree as follows:

1. Engagement. Upon the terms and conditions contained herein, AWT hereby
engages Kriegsman, and Kriegsman hereby accepts such engagement as an
independent consultant and advisor to AWT. Throughout the term of this
Agreement, Kriegsman shall provide the following services to AWT:

(a) Assist AWT in developing and recruiting members of the Board of
Directors and Board of Advisors which reflects prominent and recognized
members involved in the health care industry and AWT's business;

(b) Assist AWT's Board of Directors and management in recruiting
senior executives to complete the management team and successfully
implement AWT's business plan;

(c) Assist AWT in arranging and negotiating appropriate strategic
alliances, joint venture arrangements and licensing agreements with major
companies both nationally and internationally,

(d) Recruit potential members to serve on AWT's Board of Directors or
Board of Advisors;

(e) Assist AWT in raising equity capital through private placements
and/or public offerings;

<PAGE>

(f) Initiate research coverage of AWT's common stock with a "buy"
recommendation;

(g) Seek out and approach investment bankers and other sources of
equity or debt funding for AWT in an effort to develop an interest in
having a future relationship with AWT; and

(h) Develop and assist AWT in expanding its media presence for AWT
and its wound therapy in trade and financial publications.

AWT shall have no specific control over Kriegsman's particular methods and
procedures for performing the services hereunder outside the general guidelines
prescribed from time to time by AWT. Kriegsman agrees to perform the duties
described herein in a faithful, diligent, and professional manner and shall be
at all times courteous and considerate to potential and actual customers of AWT
so as to maintain AWT's goodwill in the community.

2. Term. The term of this engagement shall be for a period of thirty-six
(36) months commencing on the effective date hereof and shall continue until
the third anniversary of such date unless otherwise terminated as provided
herein, or by mutual agreement of the parties.

3. Compensation.

(a) Monthly Consulting Fee. Kriegsman will be paid a monthly consulting
fee of up to Twenty-Five Thousand Dollars ($25,000.00) per month based upon the
dollar value of equity placements or funds from joint ventures, strategic
alliances or licenses arranged for AWT by Kriegsman. Kriegsman will be paid an
initial non-refundable consulting fee in the amount of Twenty-Five Thousand
Dollars ($25,000.00) upon the execution of this Agreement. Once Kriegsman has
raised a minimum of Three Million Dollars ($3,000,000.00) on behalf of AWT,
Kriegsman will receive the sum of Five Thousand Dollars ($5,000.00), due and
payable on the first (1st) day of each month beginning with the first month
following AWT's receipt of proceeds aggregating Three Million Dollars
($3,000,000.00) from the efforts of Kriegsman under this Agreement and
continuing each month thereafter during the term of this Agreement. The monthly
consulting fees shall be increased from Five Thousand Dollars ($5,000.00) up to
Twenty Five Thousand Dollars ($25,000.00) per month once AWT has received
aggregate proceeds in excess of Three Million Dollars ($3,000,000.00). The
amount of the consulting fee due and payable shall be determined based upon a
formula which shall be a fraction multiplied times Twenty-Five Thousand Dollars
($25,000.00). The numerator of the fraction shall be the amount of proceeds
received by AWT from the efforts of Kriegsman and the denominator shall be
Fifteen Million Dollars ($ 15,000,000.00). For example, if Kriegsman has raised
Twelve Million Dollars ($12,000,000.00), then the amount of the consulting fee
will be Twenty Thousand Dollars ($20,000.00) ($12,000,000.00 / $15,000,000.00 x
$25,000.00). In no event shall the

<PAGE>

monthly fee payable exceed Twenty-Five Thousand Dollars ($25,000.00)
regardless of the monies raised by Kriegsman for the benefit of AWT.

(b) Reimbursement of Expenses. AWTX will reimburse Kriegsman for
reasonable out-of-pocket expenses incurred by Kriegsman in performing his
services hereunder. Expenses aggregating in excess of Five Hundred Dollars
($500.00) per month must be approved in advance by AWT. Reimbursement shall be
made on a monthly basis following Kriegsman's submission of reasonable
documentation.

(c) Stock Options. In addition to the consulting fees due and payable
under subparagraph (a) above, Kriegsman shall be entitled to the following
stock options and warrants to purchase stock in the Company on the following
terms and conditions:

(i) Award of Initial Options. Upon the execution of this Agreement,
AWT shall grant Kriegsman the option to purchase up to One Hundred Fifty
Thousand (150,000) shares of AWT common stork at an exercise price of Four
Dollars ($4.00) per share. The options must be exercised within five (5)
years of the date of grant. AWT agrees to include the shares issued in
connection with the exercise of the options granted under this
subparagraph (c)(i) to Kriegsman in the next registration statement filed
by the Company or on behalf of any other shareholder having demand
registration rights following the exercise of said options.

(ii) Additional Options. AWT agrees to issue additional options to
purchase its common stock to Kriegsman aggregating in an amount not to
exceed Four Hundred Fifty Thousand (450,000) shares, exercisable at Four
Dollars ($4.00) per share, which shall be issued based upon Kriegsman
meeting the following performance obligations:

(A) Options to purchase One Hundred Fifty Thousand (150,000)
shares shall be issued immediately following AWT's hiring of a senior
executive officer introduced by Kriegsman to AWT;

(B) Options to purchase One Hundred Twenty-Five Thousand
(125,000) shares shall be issued after two (2) members introduced by
Kriegsman accept appointment to AWT's Board of Directors;

(C) Options to purchase One Hundred Twenty-Five Thousand
(125,000) shares will be issued for each One Million Dollars
($1,000,000.00) in excess of Three Million Dollars ($3,000,000.00) in
equity capital or funds from joint ventures, strategic alliances or
licensing transactions arranged for AWT by Kriegsman have been
received by AWT; and

(D) Subject to the issuance of the options described in (A)
through (C) above in the aggregate limitation of Four Hundred Fifty
Thousand (450,000) options to be granted under this subparagraph (c),
up to One Hundred Fifty

3
<PAGE>

Thousand (150,000) options will be issued on the first (1st ), second
(2nd) and third (3rd) anniversary date of the execution of this
Agreement.

(iii) The foregoing options will (a) vest immediately upon
issuance to Kriegsman, (b) permit cashless exercise to the
extent of the option price, (c) be exercisable for a five (5)
year period following the date of issue; however, AWT will agree
to extend the exercise term for the options for up to an
additional three (3) year period if it is determined that FDA
approval is required for AWT's chronic wound care therapy and
(d) AWT agrees to include the shares issued in connection with
the exercise of the options granted under this subparagraph (c)
to Kriegsman in the next registration statement filed by the
Company or on behalf of any other shareholder having demand
registration rights following the exercise of said options.
Kriegsman shall be solely responsible for any income tax
liability, withholding or deposits required in connection with
the issuance or exercise of any option.

(d) Fee on Equity or Debt Placements. In addition to the amounts
payable under subparagraph (a) and the issuance of the options
described in subparagraph (c) above, for any equity capital or
convertible debt placement with sources introduced exclusively by
Kriegsman, Kriegsman shall be paid a fee equal to eight percent (8%)
of the proceeds from such equity or debt placement. Additionally, AWT
shall issue Kriegsman warrants representing the right to purchase ten
percent (10%) of the number of shares issued in the equity placement
(or shares in which the debt is convertible into) which warrants
shall be exercisable at any time during a five (5) year period
following the date of issuance at an exercise price equal to the per
share purchase price of the equities sold or the conversion price for
the debt into equity of AWT. The fees shall be due and payable at the
time of AWT's receipt of the proceeds from the equity or debt
offering.

(e) Merger, Sale or Acquisition of AWT. In addition to the
amounts payable under subparagraph (a) and the issuance of the
options described in subparagraph (c) above, in the event Kriegsman
arranges for the merger, sale or acquisition of AWT, then all
remaining outstanding options shall immediately vest and Kriegsman
will be paid a success fee on the closing of the transaction equal to
six percent (6%) of the value of the consideration received in such
transaction by AWT or AWT's stockholders. At the option of Kriegsman
the fees payable under this subparagraph (e) may be payable either in
cash or in the form of stock in AWT or the surviving company in such
merger, sale or acquisition. In the event the consideration payable
to AWT or the AWT stockholders is in the form of installment or
deferred payments, then the payment of any fees attributable to such
installment or deferred payments shall be paid at such time or times
as AWT or AWT's shareholders receive the installment or deferred
payments from the acquiring Company.

(f) Form of Warrant. Any warrants issued pursuant to
subparagraphs (d) or (e) above shall be in the form a standard
underwriter's and similar to that used previously by AWT and permit
cashless exercise to the extent of the warrant price. Kriegsman shall
be solely responsible for any income tax liability, withholding or

<PAGE>

deposits required in connection with the issuance or exercise of any
warrant. AWT agrees to include the shares issued in connection with
the exercise of the warrants granted under subparagraphs (d) or (e)
to Kriegsman in the next registration statement filed by the Company
or on behalf of any other shareholder having demand registration
rights following the exercise of said warrants.

(g) Limited Assignment. Kriegsman shall have the right to assign
his rights and obligations under subparagraphs (d) and (e) to one or
more persons or entities acceptable to AWT (such acceptance not to be
unreasonably withheld).

3. Tools, Equipment and Supplies. Kriegsman shall be responsible for
supplying his/her own office space, equipment, and supplies as necessary to
properly perform the services described herein.

4. Covenant Not to Disclose Confidential Information. Except in connection
with the performance of his duties, Kriegsman covenants that he will not,
during or after the term of this engagement, disclose or make public or
otherwise use or exploit for profit any confidential proprietary information
relating to AWT's business. Upon breach by Kriegsman of the provisions of this
covenant, AWT shall be entitled to such an injunction restraining Kriegsman
from disclosing or using such information or from rendering any services to any
person, firm, partnership, corporation, association, or other entity to whom
such information has been disclosed or is threatened to be disclosed; provided,
however, nothing contained herein shall be construed as prohibiting AWT from
pursuing any other remedies available to it for any such breach or threatened
breach, including recovery of damages.

5. Termination for Cause. Notwithstanding the term specified in paragraph
2 hereof AWT shall have the right to terminate this Agreement on the eleventh
(11th) month anniversary date of the execution of this Agreement (or at any
time thereafter) upon delivering written notice of such termination to
Kriegsman of the effective date of such termination, in the event that
Kriegsman has not accomplished the following performance objectives:

(a) Raising a minimum of Two Million Dollars ($2,000,000.00) in
equity capital or proceeds from joint ventures, strategic alliances or
licensing transactions arranged for AWT by Kriegsman;

(b) Initiated research coverage of AWT by Kriegsman with a "buy"
recommendation; and

Upon AWT's election to terminate this Agreement, any remaining unissued options
shall not be issued and any rights thereto immediately forfeited without any
further action on behalf of AWT. Consulting payments, options warrants and any
other fees earned, due

5
<PAGE>

and payable under this Agreement shall be paid for the services of Kriegsman
occurring on or before the effective date of the termination of this Agreement.
Any notice of termination under this paragraph shall be given not less than
thirty (30) days prior to the effective date of termination.

6. Exclusivity Covenant. [Intentionally Deleted]

7. Assignment. Except as specifically provided herein, this agreement and
the rights, obligations and duties of Kriegsman hereunder shall not be
assignable or otherwise transferable by Kriegsman.

8. Modification. No provision contained herein may be modified, amended, or
waived except by written agreement signed by the parties to be bound thereby.

9. Binding Effect and Benefit. This agreement shall inure to the benefit
of, and shall be binding upon, the parties hereto, their heirs, executors,
administrators personal representatives, successors and permitted assigns.

10. Headings and Captions. Subject headings and captions are included for
convenience purposes only and shall not affect the interpretation of this
agreement.

11. Notice. All notices required hereunder shall be in writing and shall
be deemed to have been duly given upon delivery if delivered in person, upon
the date postmarked if mailed, registered or certified United States Mail,
postage prepaid, as follows if to Kriegsman:

Steven Kriegsman
The Kriegsman Group
920 Greentree Road
Pacific Palisades, CA 90272
Fax: 310 230-9410

if to AWT:
Autologous Wound Therapy, Inc.
1523 Bowman Road Suite A
Little Rock, AR 72211
Attn: Dennis G. Hendren, President
Fax: 501 225-8428

or to such other address as either party may designate by notice.

12. Severability. If any portion of this agreement is held invalid,
illegal, or unenforceable, such determination shall not impair or affect the
enforceability of the remaining terms and provisions herein.

6
<PAGE>

13. Waiver. No waiver of a breach or violation of any provision of this
agreement shall operate or be construed as a waiver of any subsequent breach.

14. Gender and Pronouns. Throughout this agreement, the masculine shall
include the feminine and neuter and the singular shall include the plural and
vice versa as the context requires.

15. Entire Agreement. This document constitutes the entire agreement of
the parties and supersedes any and all other prior agreements, oral or written,
with respect to the subject matter contained herein.

16. Governing Law. This agreement shall be subject to and governed by the
laws of the State of California.

17. No Joint Venture or Partnership. This agreement shall not be
considered to create any type of joint venture partnership, or other legal
relationship between the parties where either party shall share or be
responsible for the debts or liabilities of the other party. In addition, this
agreement shall not be construed as making either party an agent of the other
party beyond the extent expressly provided in and limited by this agreement, or
as giving the right of one party to legally bind the other in any manner so as
to permit the incurrence of debts and liabilities on behalf of the other party.

18. Relationship Between the Parties. The relationship between Kriegsman
and AWT shall be that of an independent contractor and not that of an employee.
Accordingly, Kriegsman shall not be entitled to any rights, privileges, or
benefits generally established for AWT employees.

19. Indemnification. AWT agrees to indemnify and hold harmless Kriegsman
from and against any and all losses, claims damages, liabilities, judgments,
charges and expenses (including all legal and other out-of-pocket expenses
reasonably incurred by Kriegsman) in connection with investigating or defending
against or providing evidence in any litigation, whether commenced or
threatened, in connection with any claim, action or proceeding whether or not
resulting in any liability, to which Kriegsman may become subject under any
other statute, at common law or otherwise, caused by or arising out of any
services provided under this Agreement; provided, however, that AWT shall not
be liable in any such case to the extent that any such loss claim, damage or
liability is incurred by Kriegsman as a result of Kriegsman's negligence or
willful misconduct. In connection with any such proceedings, Kriegsman shall be
entitled to employ counsel separate from AWT and from any other party in such
action. In such event, the reasonable fees and out-of-pocket disbursements of
such separate counsel, as incurred, shall be paid by AWT, subject to
Kriegsman's obligation to reimburse AWT to the extent that any loss, claim
damage, or liability is determined to be as a result of Kriegsman's negligence
or willful misconduct. To the extent that AWT, its officers, directors,
shareholders, agents or affiliates suffer or incur any loss, claim, damage,
liability or expense by reason of Kriegsman's negligence or willful misconduct,
then Kriegsman shall indemnify and hold such persons harmless and each such
person shall have the

<PAGE>

rights of indemnification from Kriegsman as are provided by AWT to Kriegsman
hereunder.

20. Arbitration. Any dispute arising from any interpretation, validity or
performance of this Agreement or any of its terms and provisions shall be
submitted to binding arbitration and to be conducted in accordance with the
rules of the American Arbitration Association. The proceedings shall be
conducted by one arbitrator mutually selected by the parties. If the parties
are unable to agree on an arbitrator, then one arbitrator shall be designated
by the American Arbitration Association. Arbitration proceedings shall be
conducted in Los Angeles, California or such site as otherwise mutually agreed
to by the parties. Except as otherwise specifically covered by an arbitrator's
award, each party shall bear its own respective fees and expenses in connection
with the arbitration proceedings; however, the arbitrator shall have the right
to award such fees and expenses as part of the arbitrator's decision. Any
decision by the arbitrator shall be entitled to enforcement as any judgment
entered by a court having jurisdiction over the subject matter of the dispute
and may be enforced as the same. To the extent any party is required to bring
proceedings to enforce the decision of the arbitrator, such party shall be
entitled to recover the reasonable fees and expenses incurred in such
enforcement proceedings from the other party.

8
<PAGE>

IN WITNESS WHEREOF, the parties hereto have executed this agreement
effective as of the day and year aforesaid.

Autologous Wound Therapy, Inc.

By: /s/ Dennis G. Hendren
---------------------------
Dennis G. Hendren, President

Kriegsman:

The Kriegsman Group

By: /s/ Steven Kriegsman
---------------------------
Steven Kriegsman

<PAGE>
Exhibit 10.4

FIRST AMENDMENT TO CONSULTING AGREEMENT

This First Amendment to Consulting Agreement (the "Amendment") is executed
effective as of the 22nd day of February, 2000, by and between Autologous Wound
Therapy, Inc., a Delaware corporation ("AWT"), and The Kriegsman Group, a sole
proprietorship based in California and owned by Steven Kriegsman, an individual
and a resident of the State of California (collectively "Kriegsman").

WITNESSETH:

WHEREAS, as of January 12, 2000 AWT and Kriegsman entered into a
Consulting Agreement (the "Agreement"), a copy of which is attached hereto as
Exhibit 1; and

WHEREAS, AWT and Kriegsman wish to amend certain provisions of the
Agreement;

1. Kriegsman has introduced to AWT a potential senior management team led
by Jim Cour of Baxter International, Inc. (the "Baxter Team"). AWT and the
Baxter Team are presently in negotiations regarding the terms and conditions
upon which the Baxter Team will join AWT. The Baxter Team consists of Jim Cour
and other persons from senior management at Baxter International, Inc. or
persons who had previously served in senior management roles at Baxter
International, Inc.

2. Upon Jim Cour or other members of the Baxter Team joining AWT as senior
management (the "New Management Event"), Kriegsman shall be deemed to have
earned and shall immediately receive the 150,000 options due Kriegsman pursuant
to paragraph 3(c)(ii)(A) of the Agreement.

3. Upon the New Management Event occurring Kriegsman shall be deemed to
have satisfied the performance objectives set forth in paragraph 5 of the
Agreement, such that the Agreement shall not be subject to termination prior to
the conclusion of its 36 month term.

4. If a total of two or more members of the Baxter Team, and/or persons
acquainted with or proposed by the Baxter Team, accept appointment to AWT's
board of directors, then Kriegsman shall be deemed to have earned and shall
immediately receive the 125,000 options due Kriegsman pursuant to paragraph
3(c)(ii)(B) of the Agreement, without regard to whether Kriegsman introduced
such persons to AWT.

5. If, on or after a New Management Event, a merger, sale, acquisition or
strategic alliance occurs, then in such event Kriegsman shall be deemed to have
carried and shall receive the compensation due Kriegsman pursuant to paragraph
3(e) of the Agreement, without regard to whether Kriegsman arranged such
transaction.

<PAGE>

6. In all other respects the Agreement shall remain in full force and
effect. Any inconsistency between this Amendment and the Agreement shall be
resolved in favor of the terms of this Amendment.

IN WITNESS WHEREOF, the parties hereto have executed this Amendment
effective as of the day and year aforesaid.

Autologous Wound Therapy, Inc,

By: /s/ Dennis G. Hendren
---------------------------------
Dennis G. Hendren

The Kriegsman Group

By: /s/ illegible
---------------------------------

<PAGE>
Exhibit 10.5

EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT (the "Agreement") is made effective as of March
3, 2000 (the "Effective Date"), between AUTOLOGOUS WOUND THERAPY, INC., a
Delaware corporation (the "Company"), and JAMES A. COUR ("Executive").

WHEREAS, the Company desires to employ Executive on the terms and
conditions hereinafter set forth;

WHEREAS, the Company recognizes that Executive's employment is critical to
the growth and success of the Company and therefore desires to assure the
Company of Executive's continued employment; and

WHEREAS, based on the foregoing, the Company and Executive wish to enter
into this agreement to come into force as of the Effective Date.

NOW, THEREFORE, in consideration of the promises and the mutual covenants
and agreements herein contained, the Company and Executive hereby agree as
follows:

ARTICLE 1. EMPLOYMENT

A. EMPLOYMENT AND DUTIES. The Company shall employ Executive for the Term (as
hereinafter defined) as President and Chief Executive Officer. In this
capacity, Executive shall have the full authority and be responsible to manage
the operations of the Company consistent with the Company's annual and
strategic business plans, such plans to set forth guidelines related to
budgeting, capital expenditures, hiring and other initiatives, and to be
formulated by Executive and approved by the Company's Board of Directors.
Executive shall have the authority to bind the Company to contracts that are
consistent with the Executive's duties and responsibilities, subject only to
specific limitations imposed by the Company's Board of Directors. During the
Term of his employment, Executive's authority and responsibilities to manage
the operations of the Company shall not be materially diminished without his
prior consent. Executive hereby accepts such employment and agrees to render
such services on behalf of the Company. Executive shall perform his duties and
carry out his responsibilities hereunder in a diligent manner, and shall devote
his exclusive and full working time, attention and effort to the affairs of the
Company, shall use all reasonable efforts to promote the interests of the
Company and shall be just and faithful in the performance of his duties and in
carrying out his responsibilities.

B. LOCATION. The principal location for performance of Executive's services
hereunder shall be at the Company's executive offices, which are to be
re-located to north suburban Chicago, Illinois, subject to reasonable travel
requirements during the course of performing such services.

C. BOARD OF DIRECTORS. Executive agrees to accept election and to serve during
all or any part of the Term as a director of the Company and of any subsidiary
or affiliate of the Company, without any compensation therefor other than that
specified herein, if elected to any such position by the Board of Directors or
by the stockholders of the Company or of any subsidiary or

<PAGE>

affiliate, as the case may be. The Company will use its best efforts to cause
and maintain the election of Executive to the Company's Board of Directors. In
connection therewith, the Company shall use its best efforts to include
Executive in the management slate for election as a director at every annual
meeting of shareholders of the Company at which his term as a director would
otherwise expire. Upon the termination of this Agreement or Executive's
employment hereunder for any reason, Executive shall resign from the Board and
from all other positions as an officer or director of any of the Company's
subsidiaries or affiliates.

ARTICLE 2. EMPLOYMENT TERM

The term of Executive's employment hereunder (the "Term") shall be deemed
to commence on the Effective Date and shall end on December 31, 2001, unless
sooner terminated in accordance with the terms of this Agreement; provided,
however, that the Term shall be automatically renewed and extended for
additional and successive Terms of two (2) years each at the end of each Term
(and any subsequent renewal Term thereof) unless either party gives Notice of
Termination (as hereinafter defined) to the other party no later than ninety
(90) days before the expiry of the then-current Term.

ARTICLE 3. COMPENSATION AND BENEFITS

In consideration for performing services on behalf of the Company, the
Executive shall receive the following compensation and benefits:

A. CASH COMPENSATION.

i. BASE SALARY. The Company shall pay Executive an annual salary of
Two Hundred and Twenty-Five Thousand Dollars ($225,000), payable in
bi-weekly installments, in arrears (the "Base Salary"). The Base
Salary shall be reviewed annually by the Company's Board of Directors
and may be increased, but not decreased (unless mutually agreed upon
by Executive and the Company).

ii. BONUS AND INCENTIVE PLANS. The Company shall establish, and
Executive shall be entitled to participate in, Executive Bonus
Compensation and Long-Term Incentive Programs, which shall be
substantially in accordance with the summary points contained in Part
A of Appendix I, attached hereto and made part hereof.

Page 2

<PAGE>

(20) days of vacation per year, to be used in accordance with the
Company's vacation policy for senior executives as may be in force
from time to time. During the existence of a Benefit Period, if any,
(as hereinafter defined), the Company will arrange to provide
Executive with welfare benefits (including life and health insurance
benefits) of substantially similar design and cost to Executive as
the welfare benefits and other employee benefits available to
Executive prior to Executive's or the Company's, as the case may be,
receipt of Notice of Termination (as hereinafter defined). In the
event that Executive shall obtain full-time employment providing
comparable welfare benefits during the Benefit Period, such benefits
as otherwise receivable hereunder by Executive shall be discontinued.

iv. EXPENSES. The Company will pay or reimburse Executive for all
reasonable and necessary out-of-pocket expenses incurred by him in
the performance of his duties under this Agreement, including first
class air travel and reasonable capital and operating expenses for an
office in Executive's home. Executive shall keep detailed and
accurate records of expenses incurred in connection with the
performance of his duties hereunder and reimbursement therefor shall
be in accordance with policies and procedures to be established from
time to time by the Company's Board of Directors.

B. STOCK WARRANTS. As a special incentive to obtain the services of
Executive, Company hereby grants Executive the option to purchase one
million (1,000,000) shares of the common stock of the Company at $7.00
per share at any time, under either periodic or accelerated exercise
terms as described below.

i. PERIODIC EXERCISE RIGHTS. Executive's option to purchase shares
shall vest and become fully and freely exercisable with respect to
the first three hundred thirty-four thousand (334,000) shares on
December 31, 2000; with respect to the next three hundred
thirty-three thousand (333,000) shares on December 31, 2001, and with
respect to the final three hundred thirty-three thousand (333,000)
shares on December 31, 2002; subject, however, to the provisions of
Sub-section (iii), of this Section (B):

ii. ACCELERATED EXERCISE RIGHTS. Notwithstanding periodic exercise
rights, all of Executive's options that are not already exercisable
in accordance with Sub-section 3(B)(i) shall become immediately
exercisable at such time that the common stock of the Company trades
at or above 37 and 5/8ths dollars per share (the "Target Price") as
quoted on the securities exchange where the Company stock is
currently being traded and during either of the two periods, chosen
at the option of the Executive:

a. the closing price for the stock is at or above the Target
Price for fifteen (15) consecutive trading days; or

b. the closing price for the stock is at or above the Target
Price for twenty (20) out of any thirty (30) consecutive trading
days.

Page 3
<PAGE>

The determination of the Target Price during either of such periods
shall be conclusive as reported by any independent financial
reporting service, such as Reuters or Bloomberg Financial Markets.

iii POST-TERMINATION EXERCISE RIGHTS. Notwithstanding any of the
foregoing, Executive shall have the right to exercise options to
purchase any stock warrants or other stock grants given by the
Company in accordance with the following:

(a) if Executive's employment is terminated for Cause (as
defined in Article 4(A)(ii), hereunder), or in the event that
Executive voluntarily resigns his employment with the Company,
vesting of all options shall cease immediately upon the
effective date of termination or resignation;

(b) if Executive's employment is terminated by reason of
Death or Disability (as defined in Article 4(B) hereunder),
Executive's legal representatives, conservators, heirs or
assigns shall have the right to exercise all such options until
such options expire in accordance with the option plan under
which such options were granted. The rights granted under this
Sub-paragraph (iii)(b) shall apply whether or not the option was
vested at the time of Death or Disability; provided, however,
tha Executive was employed by the Company for at least twelve
(12) months after the grant of any option; or

(c) if Executive's employment is terminated for any reason
other than Death or Disability, or in the event that Executive
voluntarily resigns, then Executive shall have the right to
exercise all options that have already vested as of the
effective date of termination or resignation (or that become
vested by reason of termination or resignation) during a period
of ninety (90) days following the effective date of termination
or resignation.

iv. ISSUANCE OF REGISTERED SHARES. The Company hereby guarantees that
it will issue registered common stock (the term "registered" as
defined in the Securities and Exchange Act of 1934) to the Executive
pursuant to the exercise of his options under Sub-sections (i) -
(iii) of this Section 3(B). In the event that the Company does not
have sufficient quantities of registered shares available to satisfy
this obligation, it shall immediately take all steps necessary to
issue a registration statement and to make sufficient registered
shares available in satisfaction of this Sub-section (iv).

v. DILUTION. In the event that the Company issues new or additional
equity securities, debt securities convertible into equity, declares
a stock dividend, stock split, grants stock rights, or performs any
other action that would reasonably be expected to reduce the value of
the warrants, the Company shall immediately reduce the purchase
price, increase number of the warrants, or both, so that value of the
warrants granted to Executive remains unchanged.

Page 4
<PAGE>

vi. EXPIRATION DATE. The options to purchase shares shall expire ten
(10) years from the date each option becomes exercisable.

ARTICLE 4. TERMINATION OF EMPLOYMENT

A. DEFINITIONS. The following terms shall have the definitions as described in
this Section A:

i. "Benefit Period" shall mean:

a. the twenty-four (24) month period commencing on the Date of
Termination which occurs in connection with a termination of
employment described in the first sentence of Section 4(E)(i);
or

b. the period consisting of the remainder, if any, of the then
current Term in which occurs a termination of employment
described in the first sentence of Section 4(E)(ii), plus the
immediately succeeding twenty-four (24) month period.

ii. "Cause" shall mean any of the following:

a. any act or failure to act (or series or combination thereof)
by Executive done with the intent to harm in any material
respect to the interests of the Company;

b. the commission by Executive of a felony involving moral
turpitude;

c. the perpetration by Executive of a dishonest act or common
law fraud against the Company or any subsidiary thereof;

d. a grossly negligent act or failure to act (or series or
combination thereof) by Executive detrimental in any material
respect to the interests of the Company;

e. the material breach by Executive of his agreements or
obligations under this Agreement; or

f. the continued refusal to follow the directives of the
President or Board of Directors that are consistent with
Executive's duties and responsibilities identified in Section
1(A) hereof.

iii. A "Change of Control" shall mean any of the following:

a. a sale of all or substantially all of the assets of the
Company;

b. the acquisition of more than eighty percent (80%) of the
Common Stock of the Company (with all classes or series thereof
treated as a single class) by any

Page 5

<PAGE>

person or group of persons, except a Permitted Shareholder (as
hereinafter defined), acting in concert. A "Permitted
Shareholder" means a holder, as of the date the Stock Option
Plan was adopted by the Company, of Common Stock;

c. a reorganization of the Company wherein the holders of Common
Stock of the Company receive stock in another company, a merger
of the Company with another company wherein there is an eighty
percent (80%) or greater change in the ownership of the Common
Stock of the Company as a result of such merger, or any other
transaction in which the Company (other than as the parent
corporation) is consolidated for federal income tax purposes or
is eligible to be consolidated for federal income tax purposes
with another corporation;

d. in the event that the Common Stock is traded on an
established securities market, a public announcement that any
person has acquired or has the right to acquire beneficial
ownership of fifty-one percent (51%) or more of the
then-outstanding Common Stock and for this purpose the terms
"person" and "beneficial ownership" shall have the meanings
provided in Section 13(d) of the Securities and Exchange Act of
1934 or related rules promulgated by the Securities and Exchange
Commission, or the commencement of or public announcement of an
intention to make a tender offer or exchange offer for fifty-one
percent (51%) or more of the then outstanding Common Stock;

e. a majority of the Board of Directors is not comprised of
Continuing Directors. A "Continuing Director" means a director
recommended by the Board of Directors of the Company for
election as a director of the Company by the stockholders; or

f. the Board of Directors of the Company, in its sole and
absolute discretion, determines that there has been a sufficient
change in the share ownership of the Company to constitute a
change of effective ownership or control of the Company.

iv. "Good Reason" shall mean the occurrence of any one or more of the
following events during the Term:

a. the assignment to Executive of any duties inconsistent in any
respect with Executive's position (including status, offices,
title, and reporting requirements), authority, duties or other
responsibilities or any other action of the Company that results
in a diminishment in such position, authority, duties or
responsibilities, other than an insubstantial and inadvertent
action that is remedied by the Company promptly after receipt of
notice thereof given by Executive;

b. a reduction by the Company in Executive's Base Salary as in
effect on the Effective Date and as the same shall be increased
from time to time hereafter;

Page 6

<PAGE>

c. the Company's requiring Executive to be based at a location
in excess of fifteen (15) miles from the location of Executive's
principal residence without the consent of Executive;

d. the failure by the Company to: (a) continue in effect any
material compensation or benefit plan, program, policy or
practice in which Executive was participating during the Term of
his employment or at the time of a Change of Control; or (b)
provide Executive with compensation and benefits at least equal
(in terms of benefit levels and/or reward opportunities) to
those provided for under each employee benefit plan, program,
policy and practice as in effect immediately prior to a Change
of Control (or as in effect following the Change of Control, if
greater);

e. the failure of the Company to obtain a satisfactory agreement
from any successor to the Company to assume and agree to perform
this Agreement; or

f. any purported termination by the Company of Executive's
employment that is not effected pursuant to a Notice of
Termination (as defined below).

v. "Date of Termination" shall mean the date specified in the Notice
of Termination (as hereinafter defined) (except in the case of
Executive's death, in which case Date of Termination shall be the
date of death); provided, however, that if Executive's employment is
terminated by the Company other than for Cause, the date specified in
the Notice of Termination shall be at least thirty (30) days from the
date the Notice of Termination is given to Executive and if
Executive's employment is terminated by Executive for Good Reason,
the date specified in the Notice of Termination shall not be more
than sixty (60) days from the date the Notice of Termination is given
to the Company.

vi. "Notice of Termination" shall mean a written notice either from
the Company to Executive, or Executive to the Company, that indicates
Section 2 or the specific provision of Section 4 of this Agreement
relied upon as the reason for such termination or non-renewal, the
Date of Termination, and, in reasonable detail, the facts and
circumstances claimed to provide a basis for termination or
non-renewal pursuant to Section 2 or this Section 4 of this
Agreement.

B. TERMINATION UPON DEATH OR DISABILITY. This Agreement, and Executive's
employment hereunder, shall terminate automatically and without the necessity
of any action on the part of the Company upon the death of Executive. In
addition, if at any time during the Term Executive shall become physically or
mentally disabled, whether totally or partially, so that he is unable
substantially to perform his duties and services hereunder for:

Page 7

<PAGE>
i. a period of six (6) consecutive months; or

ii. for shorter periods aggregating six (6) months during any twelve
(12) month period;

then, the Company may at any time after the last day of the sixth consecutive
month of disability or the day on which the shorter periods of disability shall
have equaled an aggregate of six (6) months, by written notice to Executive
(but before Executive has recovered from such disability), terminate this
Agreement and Executive's employment hereunder.

C. COMPANY'S AND EXECUTIVE'S RIGHT TO TERMINATE PRIOR TO CHANGE OF CONTROL.
Prior to a Change of Control, this Agreement and Executive's employment
hereunder may be terminated at any time by the Company, with or without Cause,
upon thirty (30) days prior written notice to Executive, and by Executive, at
any time, upon thirty (30) days prior written notice to the Company. Any
termination of Executive's employment by the Company without Cause prior to a
Change of Control that occurs at the request or insistence of any person (other
than the Company) relating to such Change of Control shall be deemed to have
occurred after the Change of Control for the purposes of this Agreement.

D. COMPANY'S AND EXECUTIVE'S RIGHT TO TERMINATE FOLLOWING A CHANGE OF CONTROL.
Following a Change of Control, this Agreement and Executive's employment
hereunder may be terminated at any time:

i. by the Company, with or without Cause, upon thirty (30) days prior
written notice to Executive, or

ii. by Executive for Good Reason upon thirty (30) days prior written
notice to the Company. Executive's right to terminate his employment
pursuant to this Section 4(D) shall not be affected by incapacity due
to physical or mental illness. Executive's continued employment
following a Change of Control shall not constitute consent to, or a
waiver of, rights with respect to, any circumstance constituting Good
Reason hereunder.

E. COMPENSATION UPON TERMINATION.

Page 8

<PAGE>

otherwise required under the Company's Stock Option Plan or any award
agreement with Executive, any unvested stock option awards
theretofore awarded to Executive shall vest and become exercisable on
the Date of Termination. In the event this Agreement is terminated
(or not renewed) for any reason other than by the Company without
Cause, and such termination (or non-renewal) occurs prior to a Change
of Control, Executive shall not be entitled to the continuation of
any compensation, bonuses or benefits provided hereunder, or any
other payments following the Date of Termination, other than Base
Salary earned through such Date of Termination.

ii. TERMINATION FOLLOWING CHANGE OF CONTROL. If this Agreement is
terminated (or not renewed)

a. by the Company without Cause; or

b. by the Executive for Good Reason during the twelve (12) month
period immediately following a Change of Control, and such
termination (or non-renewal) occurs following a Change of
Control;

then, the Executive shall be entitled to receive his full Base Salary
through the Date of Termination, the welfare benefits described in
Section 3(A)(iii) for the Benefit Period and, not later than thirty
(30) days after the Date of Termination, a lump sum severance payment
equal to the sum of the Base Salary which would otherwise have been
payable for the remainder (if any) of the then current Term, plus an
amount equal the product of two (2) times the sum of Executive's then
current annual Base Salary plus the arithmetic average of payments
made to Executive pursuant to the Company's Executive Bonus
Compensation Program with respect to the three (3) fiscal years
immediately preceding the fiscal year in which the Date of
Termination occurs.

In addition to the foregoing, to the extent not otherwise required
under the Company's Stock Option Plan or any other award agreement
with Executive, any unvested stock option awards theretofore awarded
to Executive shall vest and become immediately exercisable in full.
In the event this Agreement is terminated (or not renewed) for any
reason other than by the Company without Cause, or by Executive for
Good Reason, and such termination (or non-renewal) occurs following a
Change of Control, Executive shall not be entitled to the
continuation of any compensation, bonuses or benefits provided
hereunder, or any other payments following the Date of Termination,
other than Base Salary earned through the Date of Termination.

iii. At Executive's option to be exercised by written notice to the
Company, the severance benefits payable under this Section 4(E) shall
be paid in accordance with the Company's normal payroll procedures in
installments over a twenty-four (24) month period corresponding to
the amount of the payments instead of in a lump sum.

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<PAGE>

iv. Anything to the contrary contained herein notwithstanding, as a
condition to Executive receiving severance benefits to be paid
pursuant to this Section 4(E), Executive shall execute and deliver to
the Company a general release in form and substance reasonably
satisfactory to the Company releasing the Company and its officers,
directors, employees and agents from all liabilities, claims and
obligations of any nature whatsoever, excepting only the Company's
obligations under this Agreement, under any Stock Option Award
Agreements, and under any other employee benefit plans or programs in
which Executive participates under Section 3 hereof, subject to all
terms and conditions of such plans or programs and this Agreement.

ARTICLE 5. EMPLOYMENT COVENANTS

A. TRADE SECRETS AND CONFIDENTIAL INFORMATION. Executive agrees that he shall,
during the course of his employment and for a period of five (5) years
thereafter, hold inviolate and keep secret all documents, materials, knowledge
or other confidential business or technical information of any nature
whatsoever disclosed to or developed by him or to which he had access as a
result of his employment (hereinafter referred to as "Confidential
Information"). Such Confidential Information shall include technical and
business information, including, but not limited to, inventions, research and
development, engineering, products, designs, manufacture, methods, systems,
improvements, trade secrets, formulas, processes, marketing, merchandising,
selling, licensing, servicing, customer lists, records or financial
information, manuals or Company strategy concerning its business, strategy or
policies. Executive agrees that all Confidential Information shall remain the
sole and absolute property of the Company. During the course of his employment,
Executive shall not use, disclose, disseminate, publish, reproduce or otherwise
make available such Confidential Information to any person, firm, corporation
or other entity, except for the purpose of conducting business on behalf of the
Company. Following the Term, Executive shall not use, disclose, disseminate,
publish, reproduce, or otherwise make available such Confidential Information
to any person, firm, corporation, or other entity. Upon termination of his
employment with the Company, Executive will leave with or deliver to the
Company all records and any compositions, articles, devices, equipment and
other items which disclose or embody Confidential Information including all
copies or specimens thereof, whether prepared by his or by others. The
foregoing restrictions on disclosure of Confidential Information shall apply so
long as the information has not properly come into the public domain through no
action of Executive.

B. TRANSFER OF INVENTIONS. Executive, for himself and his heirs and
representatives, will promptly communicate and disclose to the Company, and
upon request will, without additional compensation, execute all papers
reasonably necessary to assign to the Company or the Company's nominees, free
of encumbrance or restrictions, all inventions, discoveries, improvements,
whether patentable or not, conceived or originated by Executive solely or
jointly with others, at the Company's expense or at the Company's facilities,
or at the Company's request, or in the course of his employment, or based on
knowledge or information obtained through his employment during the Term. All
such assignments shall include the patent rights in this and all foreign
countries. Notwithstanding the foregoing, this Section 5(B) shall not apply to

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<PAGE>

any invention for which no equipment, supplies, facilities or trade secret
information of the Company was used and which was developed entirely on
Executive's own time; and

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<PAGE>

i. that does not relate:

a. directly to the business of the Company, or

b. to the Company's actual or demonstrably anticipated research
or development; or

ii. that does not result from any work performed by Executive for the
Company.

C. EXCLUSIVITY OF EMPLOYMENT. During the Term, Executive shall not directly or
indirectly engage in any activity competitive with or adverse to the Company's
business or welfare or render a material level of services of a business,
professional or commercial nature to any other person or firm, whether for
compensation or otherwise, except for serving as a director of another firm.

D. COVENANT NOT TO COMPETE. Executive agrees to be bound and abide by the
following covenants not to compete:

i. TERM AND SCOPE. During his employment with the Company and for a
period of two (2) years after the Term, Executive will not render to
any Conflicting Organization (as hereinafter defined), services,
directly or indirectly, anywhere in the world in connection with any
Conflicting Product, except that Executive may accept employment with
a large Conflicting Organization whose business is diversified (and
which has separate and distinct divisions) if Executive first
certifies to the Board of Directors in writing that he has provided a
copy of Section 5 of this Agreement to such prospective employer,
that such prospective employer is a separate and distinct division of
the Conflicting Organization and that Executive will not render
services directly or indirectly in respect of any Conflicting Product
(as hereinafter defined). Such two-year time period shall be tolled
during any period that Executive is engaged in activity in violation
of this covenant.

ii. JUDICIAL ACTION. Executive and the Company agree that, if the
period of time or the scope of the restrictive covenant not to
compete contained in this Section 5(D) shall be adjudged unreasonable
in any court proceeding, then the period of time and/or scope shall
be reduced accordingly, so that this covenant may be enforced in such
scope and during such period of time as is judged by the court to be
reasonable. In the event of a breach or violation of this Section
5(D) by Executive, the parties agree than in addition to all other
remedies, the Company shall be entitled to equitable relief for
specific performance, and Executive hereby agrees and acknowledges
that the Company has no adequate remedy at law for the breach of the
covenants contained herein.

iii. DEFINITIONS. For purposes of the covenants contained in this
Section 5(D), the following terms shall have the following meanings:

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<PAGE>

a. "Conflicting Product" means any product, method or process,
system or service of any person or organization other than the
Company, in existence or under development at the time
Executive's employment with the Company terminates, that is the
same as or substantially or directly competes with a product,
method or process, system or service of or provided by the
Company or any of its affiliates or about which Executive
acquires Confidential Information.

b. "Conflicting Organization" means any person or organization
which is engaged in or about to become engaged in, research on
or development, production, marketing, licensing, selling or
servicing of a Conflicting Product.

iv. DISCLOSURE TO PROSPECTIVE EMPLOYERS. Executive will disclose to
any prospective employer, prior to accepting employment, the
existence of Section 5 of this Agreement. The obligation imposed by
this Section 5(D) shall terminate two (2) years after termination of
Executive's employment with the Company; provided, however, the
running of such two-year period shall be tolled to the extent the
covenant not to compete contained in Section 5(D) hereof is tolled.

ARTICLE 6. MISCELLANEOUS

A. NOTICES. Any notice required or permitted to be delivered hereunder shall be
in writing and shall be deemed to be delivered on the earlier of

i. the date received; or

ii. the date of delivery, refusal or non-delivery indicated on the
return receipt, if deposited in a United States Postal Service
depository, postage prepaid, sent registered or certified mail,
return receipt requested, addressed to the party to receive the same
at the address of such party set forth below:

If to the Company: If to the Executive:

Autologous Wound Therapy, Inc. James A. Cour
1523 Bowman Road, Suite A c/o Michael J. Caywood, Esq.
Little Rock, Arkansas Dresser, Dresser, Gilbert & Haas, PC
72211 USA 112 South Monroe Street
Sturgis, Michigan
49091 USA

A Party may change its address from time to time by Notice addressed
to the other Party.

B. HEADINGS. The headings of the articles and sections of this Agreement are
inserted for convenience only and shall not be deemed a part of or affect the
construction or interpretation of any provision hereof.

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<PAGE>

C. MODIFICATIONS & WAIVER. No modification of any provision of this Agreement
or waiver of any right or remedy herein provided shall be effective for any
purpose unless specifically set forth in a writing signed by the party to be
bound thereby. No waiver of any right or remedy in respect of any occurrence or
event on one occasion shall be deemed a waiver of such right or remedy in
respect of such occurrence or event on any other occasion.

D. ENTIRE AGREEMENT. This Agreement contains the entire agreement of the
parties with respect to the subject matter hereof and supersedes all other
agreements; oral or written, heretofore made with respect thereto.

E. SEVERABILITY. Any provision of this Agreement prohibited by or unlawful or
unenforceable under any applicable law of any jurisdiction shall as to such
jurisdiction be ineffective without affecting any other provision hereof. To
the full extent, however, that the provisions of such applicable law may be
waived, they are hereby waived, to the end that this Employment Agreement be
deemed to be a valid and binding agreement enforceable in accordance with its
terms.

F. GOVERNING LAW AND JURISDICTION. This Agreement shall be deemed to have been
entered into by the parties in the State of Illinois and shall be continued and
enforced in accordance with the laws of that State. Any disputes arising under
the terms and conditions of this Agreement shall be resolved in a court of
competent jurisdiction of that State and the parties hereto irrevocably submit
to such jurisdiction.

G. ASSIGNMENTS. The Company shall have the right to assign this Agreement and
to delegate all rights, duties and obligations hereunder to any entity that
controls the Company, that the Company controls or that may be the result of
the merger, consolidation, acquisition or reorganization of the Company and
another entity. Executive agrees that this Agreement is personal to him and his
rights and interest hereunder may not be assigned, nor may his obligations and
duties hereunder be delegated (except as to delegation in the normal course of
operation of the Company), and any attempted assignment or delegation in
violation of this provision shall be void. Notwithstanding any of the
foregoing, all of Executive's rights and interest hereunder shall be assignable
to Executive's legal representatives, executors or conservators in the event of
Executive's Death or Disability.

H. ATTORNEY FEES. In the event of litigation between the parties, to enforce
their respective rights under this Agreement, the prevailing party shall be
entitled to receive from the non-prevailing party reimbursement of the
prevailing party's reasonable attorney's fees and costs at all levels of trial
and appeal.

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<PAGE>

IN WITNESS WHEREOF, the parties have executed this Agreement as of the
Effective Date.

Executive Autologous Wound Therapy, Inc.

/s/ James Cour By: /s/ Dennis G. Hendren
---------------- ----------------------------
James A. Cour Title: President/CEO

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<PAGE>

APPENDIX I

Part A - Bonus and Incentive Plans

1. ANNUAL BONUS. In addition to Executive's Base Salary, the Company shall
pay to the Executive an annual bonus in an initial amount of Seventy-Five
Thousand Dollars ($75,000). The bonus shall be payable depending on the
achievement of the Executive and the Company of a specified list of
performance and payment criteria to be agreed to between the Executive and
the Company and approved by the Company's Board of Directors. In
accordance with the Executive's annual salary review, the Executive's
annual bonus shall be reviewed and increased by the Company's Board of
Directors as may be appropriate.

2. LONG TERM INCENTIVE PROGRAM. During the Term of Executive's employment by
the Company, Executive shall be entitled to participate in the Company's
Executive Long Term Incentive Program which will be established by the
Company's Board of Director's in accordance with a strategic plan
developed for the Company and on appropriate terms and conditions.

Part B - Employee Benefit Plans and Programs

1. INSURANCE PROGRAM. The Company shall establish for the benefit of the
Executive an insurance program, which shall include, among other things,
life, health, dental and long-term disability coverage. Such insurance
program shall be no less competitive than similar benefit programs that
are established for other health care companies or comparable industries.

2. PENSION OR PROFIT-SHARING PROGRAMS. In addition to the insurance program,
the Company shall establish a suitable pension, (401(k)) or other profit
sharing program, which shall be no less competitive than similar pension
or profit-sharing programs that are established for other health care
companies or comparable industries.

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<PAGE>
Exhibit 10.6

EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT (the "Agreement") is made effective as of
March 3, 2000 (the "Effective Date"), between AUTOLOGOUS WOUND THERAPY, INC., a
Delaware corporation (the "Company"), and ROBIN LEE GELLER, Ph.D. ("Executive").

WHEREAS, the Company desires to employ Executive on the terms and
conditions hereinafter set forth;

WHEREAS, the Company recognizes that Executive's employment is critical
to the growth and success of the Company and therefore desires to assure the
Company of Executive's continued employment; and

WHEREAS, based on the foregoing, the Company and Executive wish to
enter into this agreement to come into force as of the Effective Date.

NOW, THEREFORE, in consideration of the promises and the mutual
covenants and agreements herein contained, the Company and Executive hereby
agree as follows:

ARTICLE 1. EMPLOYMENT

A. EMPLOYMENT AND DUTIES. The Company shall employ Executive for the Term (as
hereinafter defined) as Vice President, Scientific Affairs, to perform such
duties as she shall reasonably be directed by the President to perform.
Executive hereby accepts such employment and agrees to render such services on
behalf of the Company. Executive shall perform her duties and carry out her
responsibilities hereunder in a diligent manner, and shall devote her exclusive
and full working time, attention and effort to the affairs of the Company, shall
use all reasonable her efforts to promote the interests of the Company and shall
be just and faithful in the performance of her duties and in carrying out her
responsibilities.

ARTICLE 2. EMPLOYMENT TERM

The term of Executive's employment hereunder (the "Term") shall be
deemed to commence on the Effective Date and shall end on December 31, 2001,
unless sooner terminated in accordance with the terms of this Agreement;
provided, however, that the Term shall be automatically renewed and extended for
additional and successive Terms of two (2) years each at the end of each Term
(and any subsequent renewal Term thereof) unless either party gives Notice of
Termination (as hereinafter defined) to the other party no later than ninety
(90) days before the expiry of the then-current Term.

<PAGE>

ARTICLE 3. COMPENSATION AND BENEFITS

In consideration for performing services on behalf of the Company, the
Executive shall receive the following compensation and benefits:

A. CASH COMPENSATION.

i. BASE SALARY. The Company shall pay Executive an annual salary of One
Hundred and Fifty Thousand Dollars ($150,000), payable in bi-weekly
installments, in arrears (the "Base Salary"). The Base Salary shall be
reviewed annually by the Company's Board of Directors and may be
increased, but not decreased (unless mutually agreed upon by Executive
and the Company).

ii. BONUS AND INCENTIVE PLANS. The Company shall establish, and
Executive shall be entitled to participate in, Executive Bonus
Compensation and Long-Term Incentive Programs, which shall be
substantially in accordance with the summary points contained in Part A
of Appendix I, attached hereto and made part hereof.

iii. PARTICIPATION IN BENEFIT PLANS. The Company shall establish, and
Executive shall be entitled to participate in (and to the extent that
Executive's position, title, tenure, salary, age, health, and other
qualifications make her eligible to participate in), employee benefit
plans or programs, which shall be substantially in accordance with the
summary points contained in Part B of Appendix I. The Company does not
guarantee the continuance of any particular employee benefit plan or
program during the Term and Executive's participation in any such plans
or programs shall be subject to all terms, provisions, rules, and
regulations applicable thereto. Executive will be entitled to twenty
(20) days of vacation per year, to be used in accordance with the
Company's vacation policy for senior executives as may be in force from
time to time. During the existence of a Benefit Period, if any, (as
hereinafter defined), the Company will arrange to provide Executive
with welfare benefits (including life and health insurance benefits) of
substantially similar design and cost to Executive as the welfare
benefits and other employee benefits available to Executive prior to
Executive's or the Company's, as the case may be, receipt of Notice of
Termination (as hereinafter defined). In the event that Executive shall
obtain full-time employment providing comparable welfare benefits
during the Benefit Period, such benefits as otherwise receivable
hereunder by Executive shall be discontinued.

iv. EXPENSES. The Company will pay or reimburse Executive for all
reasonable and necessary out-of-pocket expenses incurred by her in the
performance of her duties under this Agreement, including first class
air travel and reasonable capital and operating expenses for an office
in Executive's home. Executive shall keep detailed and accurate records
of expenses incurred in connection with the performance of her duties
hereunder

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<PAGE>

and reimbursement therefor shall be in accordance with policies and
procedures to be established from time to time by the Company's Board
of Directors.

B. STOCK WARRANTS. As a special incentive to obtain the services of
Executive, Company hereby grants Executive the option to purchase two
hundred thousand (200,000) shares of the common stock of the Company at
$7.00 per share at any time, under either periodic or accelerated
exercise terms as described below.

i. PERIODIC EXERCISE RIGHTS. Executive's option to purchase shares
shall vest and become fully and freely exercisable with respect to the
first sixty-seven thousand (67,000) shares on December 31, 2000; with
respect to the next sixty-seven thousand (67,000) shares on December
31, 2001, and with respect to the final sixty-six thousand (66,000)
shares on December 31, 2002; subject, however, to the provisions of
Sub-section (iii), of this Section (B):

ii. ACCELERATED EXERCISE RIGHTS. Notwithstanding periodic exercise
rights, all of Executive's options that are not already exercisable in
accordance with Sub-section 3(B)(i) shall become immediately
exercisable at such time that the common stock of the Company trades at
or above 37 and 5/8ths dollars per share (the "Target Price") as quoted
on the securities exchange where the Company stock is currently being
traded and during either of the two periods, chosen at the option of
the Executive:

a. the closing price for the stock is at or above the Target Price
for fifteen (15) consecutive trading days; or

b. the closing price for the stock is at or above the Target Price
for twenty (20) out of any thirty (30) consecutive trading days.

The determination of the Target Price during either of such periods
shall be conclusive as reported by any independent financial reporting
service, such as Reuters or Bloomberg Financial Markets.

iii. POST-TERMINATION EXERCISE RIGHTS. Notwithstanding any of the
foregoing, Executive shall have the right to exercise options to
purchase any stock warrants or other stock grants given by the Company
in accordance with the following:

(a) if Executive's employment is terminated for Cause (as defined
in Article 4(A)(ii), hereunder), or in the event that Executive
voluntarily resigns his employment with the Company, vesting of
all options shall cease immediately upon the effective date of
termination or resignation;

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<PAGE>

such options expire in accordance with the option plan under which
such options were granted. The rights granted under this
Sub-paragraph (iii)(b) shall apply whether or not the option was
vested at the time of Death or Disability; provided, however, that
Executive was employed by the Company for at least twelve (12)
months after the grant of any option; or

(c) if Executive's employment is terminated for any reason other
than Death or Disability, or in the event that Executive
voluntarily resigns, then Executive shall have the right to
exercise all options that have already vested as of the effective
date of termination or resignation (or that become vested by
reason of termination or resignation) during a period of ninety
(90) days following the effective date of termination or
resignation.

iv. ISSUANCE OF REGISTERED SHARES. The Company hereby guarantees that
it will issue registered common stock (the term "registered" as defined
in the Securities and Exchange Act of 1934) to the Executive pursuant
to the exercise of his options under Sub-sections (i) - (iii) of this
Section 3(B). In the event that the Company does not have sufficient
quantities of registered shares available to satisfy this obligation,
it shall immediately take all steps necessary to issue a registration
statement and to make sufficient registered shares available in
satisfaction of this Sub-section (iv).

v. DILUTION. In the event that the Company issues new or additional
equity securities, debt securities convertible into equity, declares a
stock dividend, stock split, grants stock rights, or performs any other
action that would reasonably be expected to reduce the value of the
warrants, the Company shall immediately reduce the purchase price,
increase number of the warrants, or both, so that value of the warrants
granted to Executive remains unchanged.

vi. EXPIRATION DATE. The options to purchase shares shall expire ten
(10) years from the date each option becomes exercisable.

ARTICLE 4. TERMINATION OF EMPLOYMENT

A. DEFINITIONS. The following terms shall have the definitions as
described in this Section A:

i. "Benefit Period" shall mean:

a. the twenty-four (24) month period commencing on the Date of
Termination which occurs in connection with a termination of
employment described in the first sentence of Section 4(E)(i); or

b. the period consisting of the remainder, if any, of the then
current Term in which occurs a termination of employment described
in the first sentence of Section 4(E)(ii), plus the immediately
succeeding twenty-four (24) month period.

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<PAGE>

ii. "Cause" shall mean any of the following:

a. any act or failure to act (or series or combination thereof) by
Executive done with the intent to harm in any material respect to
the interests of the Company;

b. the commission by Executive of a felony involving moral
turpitude;

c. the perpetration by Executive of a dishonest act or common law
fraud against the Company or any subsidiary thereof;

d. a grossly negligent act or failure to act (or series or
combination thereof) by Executive detrimental in any material
respect to the interests of the Company;

e. the material breach by Executive of her agreements or
obligations under this Agreement; or

f. the continued refusal to follow the directives of the President
or Board of Directors that are consistent with Executive's duties
and responsibilities identified in Section 1(A) hereof.

iii. A "Change of Control" shall mean any of the following:

a. a sale of all or substantially all of the assets of the
Company;

b. the acquisition of more than eighty percent (80%) of the Common
Stock of the Company (with all classes or series thereof treated
as a single class) by any person or group of persons, except a
Permitted Shareholder (as hereinafter defined), acting in concert.
A "Permitted Shareholder" means a holder, as of the date the Stock
Option Plan was adopted by the Company, of Common Stock;

c. a reorganization of the Company wherein the holders of Common
Stock of the Company receive stock in another company, a merger of
the Company with another company wherein there is an eighty
percent (80%) or greater change in the ownership of the Common
Stock of the Company as a result of such merger, or any other
transaction in which the Company (other than as the parent
corporation) is consolidated for federal income tax purposes or is
eligible to be consolidated for federal income tax purposes with
another corporation;

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<PAGE>

"beneficial ownership" shall have the meanings provided in Section
13(d) of the Securities and Exchange Act of 1934 or related rules
promulgated by the Securities and Exchange Commission, or the
commencement of or public announcement of an intention to make a
tender offer or exchange offer for fifty-one percent (51%) or more
of the then outstanding Common Stock;

e. a majority of the Board of Directors is not comprised of
Continuing Directors. A "Continuing Director" means a director
recommended by the Board of Directors of the Company for election
as a director of the Company by the stockholders; or

f. the Board of Directors of the Company, in its sole and absolute
discretion, determines that there has been a sufficient change in
the share ownership of the Company to constitute a change of
effective ownership or control of the Company.

iv. "Good Reason" shall mean the occurrence of any one or more of the
following events during the Term:

b. a reduction by the Company in Executive's Base Salary as in
effect on the Effective Date and as the same shall be increased
from time to time hereafter;

c. the Company's requiring Executive to be based at a location in
excess of fifteen (15) miles from the location of Executive's
principal residence without the consent of Executive;

d. the failure by the Company to: (a) continue in effect any
material compensation or benefit plan, program, policy or practice
in which Executive was participating during the Term of her
employment or at the time of a Change of Control; or (b) provide
Executive with compensation and benefits at least equal (in terms
of benefit levels and/or reward opportunities) to those provided
for under each employee benefit plan, program, policy and practice
as in effect immediately prior to a Change of Control (or as in
effect following the Change of Control, if greater);

e. the failure of the Company to obtain a satisfactory agreement
from any successor to the Company to assume and agree to perform
this Agreement; or

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<PAGE>

f. any purported termination by the Company of Executive's
employment that is not effected pursuant to a Notice of
Termination (as defined below).

v. "Date of Termination" shall mean the date specified in the Notice of
Termination (as hereinafter defined) (except in the case of Executive's
death, in which case Date of Termination shall be the date of death);
provided, however, that if Executive's employment is terminated by the
Company other than for Cause, the date specified in the Notice of
Termination shall be at least thirty (30) days from the date the Notice
of Termination is given to Executive and if Executive's employment is
terminated by Executive for Good Reason, the date specified in the
Notice of Termination shall not be more than sixty (60) days from the
date the Notice of Termination is given to the Company.

vi. "Notice of Termination" shall mean a written notice either from the
Company to Executive, or Executive to the Company, that indicates
Section 2 or the specific provision of Section 4 of this Agreement
relied upon as the reason for such termination or non-renewal, the Date
of Termination, and, in reasonable detail, the facts and circumstances
claimed to provide a basis for termination or non-renewal pursuant to
Section 2 or this Section 4 of this Agreement.

B. TERMINATION UPON DEATH OR DISABILITY. This Agreement, and Executive's
employment hereunder, shall terminate automatically and without the necessity of
any action on the part of the Company upon the death of Executive. In addition,
if at any time during the Term Executive shall become physically or mentally
disabled, whether totally or partially, so that she is unable substantially to
perform her duties and services hereunder for:

i. a period of six (6) consecutive months; or

ii. for shorter periods aggregating six (6) months during any twelve
(12) month period;

then, the Company may at any time after the last day of the sixth consecutive
month of disability or the day on which the shorter periods of disability shall
have equaled an aggregate of six (6) months, by written notice to Executive (but
before Executive has recovered from such disability), terminate this Agreement
and Executive's employment hereunder.

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<PAGE>

Company) relating to such Change of Control shall be deemed to have
occurred after the Change of Control for the purposes of this Agreement.

D. COMPANY'S AND EXECUTIVE'S RIGHT TO TERMINATE FOLLOWING A CHANGE OF CONTROL.
Following a Change of Control, this Agreement and Executive's employment
hereunder may be terminated at any time:

i. by the Company, with or without Cause, upon thirty (30) days prior
written notice to Executive, or

ii. by Executive for Good Reason upon thirty (30) days prior written
notice to the Company. Executive's right to terminate her employment
pursuant to this Section 4(D) shall not be affected by incapacity due
to physical or mental illness. Executive's continued employment
following a Change of Control shall not constitute consent to, or a
waiver of, rights with respect to, any circumstance constituting Good
Reason hereunder.

E. COMPENSATION UPON TERMINATION.

i. TERMINATION PRIOR TO CHANGE OF CONTROL. In the event the Company
terminates (or elects not to renew) this Agreement without Cause, and
such termination (or non-renewal) without Cause occurs prior to any
Change of Control, Executive shall be entitled to receive her Base
Salary through the Date of Termination, the welfare benefits described
in Section 3(A)(iii) for the Benefit Period, and not later than thirty
(30) days after the Date of Termination, a lump sum severance payment
equal to the product of two (2) times the sum of Executive's
then-current Base Salary plus the arithmetic average of payments made
to Executive pursuant to the Company's Executive Bonus Compensation
Program with respect to the three (3) fiscal years immediately
preceding the fiscal year in which the Date of Termination occurs. In
addition to the foregoing, to the extent not otherwise required under
the Company's Stock Option Plan or any award agreement with Executive,
any unvested stock option awards theretofore awarded to Executive shall
vest and become exercisable on the Date of Termination. In the event
this Agreement is terminated (or not renewed) for any reason other than
by the Company without Cause, and such termination (or non-renewal)
occurs prior to a Change of Control, Executive shall not be entitled to
the continuation of any compensation, bonuses or benefits provided
hereunder, or any other payments following the Date of Termination,
other than Base Salary earned through such Date of Termination.

ii. TERMINATION FOLLOWING CHANGE OF CONTROL. If this Agreement is
terminated (or not renewed)

a. by the Company without Cause; or

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<PAGE>

b. by the Executive for Good Reason during the twelve (12) month
period immediately following a Change of Control, and such
termination (or non-renewal) occurs following a Change of Control;

then, the Executive shall be entitled to receive her full Base Salary
through the Date of Termination, the welfare benefits described in
Section 3(A)(iii) for the Benefit Period and, not later than thirty
(30) days after the Date of Termination, a lump sum severance payment
equal to the sum of the Base Salary which would otherwise have been
payable for the remainder (if any) of the then current Term, plus an
amount equal the product of two (2) times the sum of Executive's then
current annual Base Salary plus the arithmetic average of payments made
to Executive pursuant to the Company's Executive Bonus Compensation
Program with respect to the three (3) fiscal years immediately
preceding the fiscal year in which the Date of Termination occurs.

In addition to the foregoing, to the extent not otherwise required
under the Company's Stock Option Plan or any other award agreement with
Executive, any unvested stock option awards theretofore awarded to
Executive shall vest and become immediately exercisable in full. In the
event this Agreement is terminated (or not renewed) for any reason
other than by the Company without Cause, or by Executive for Good
Reason, and such termination (or non-renewal) occurs following a Change
of Control, Executive shall not be entitled to the continuation of any
compensation, bonuses or benefits provided hereunder, or any other
payments following the Date of Termination, other than Base Salary
earned through the Date of Termination.

iii. At Executive's option to be exercised by written notice to the
Company, the severance benefits payable under this Section 4(E) shall
be paid in accordance with the Company's normal payroll procedures in
installments over a twenty-four (24) month period corresponding to the
amount of the payments instead of in a lump sum.

iv. Anything to the contrary contained herein notwithstanding, as a
condition to Executive receiving severance benefits to be paid pursuant
to this Section 4(E), Executive shall execute and deliver to the
Company a general release in form and substance reasonably satisfactory
to the Company releasing the Company and its officers, directors,
employees and agents from all liabilities, claims and obligations of
any nature whatsoever, excepting only the Company's obligations under
this Agreement, under any Stock Option Award Agreements, and under any
other employee benefit plans or programs in which Executive
participates under Section 3 hereof, subject to all terms and
conditions of such plans or programs and this Agreement.

ARTICLE 5. EMPLOYMENT COVENANTS

A. TRADE SECRETS AND CONFIDENTIAL INFORMATION. Executive agrees that she shall,
during the course of her employment and for a period of five (5) years
thereafter, hold inviolate and keep secret all documents, materials, knowledge
or other confidential business or technical

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<PAGE>

information of any nature whatsoever disclosed to or developed by her or to
which she had access as a result of her employment (hereinafter referred to as
"Confidential Information"). Such Confidential Information shall include
technical and business information, including, but not limited to, inventions,
research and development, engineering, products, designs, manufacture, methods,
systems, improvements, trade secrets, formulas, processes, marketing,
merchandising, selling, licensing, servicing, customer lists, records or
financial information, manuals or Company strategy concerning its business,
strategy or policies. Executive agrees that all Confidential Information shall
remain the sole and absolute property of the Company. During the course of her
employment, Executive shall not use, disclose, disseminate, publish, reproduce
or otherwise make available such Confidential Information to any person, firm,
corporation or other entity, except for the purpose of conducting business on
behalf of the Company. Following the Term, Executive shall not use, disclose,
disseminate, publish, reproduce, or otherwise make available such Confidential
Information to any person, firm, corporation, or other entity. Upon termination
of her employment with the Company, Executive will leave with or deliver to the
Company all records and any compositions, articles, devices, equipment and other
items which disclose or embody Confidential Information including all copies or
specimens thereof, whether prepared by her or by others. The foregoing
restrictions on disclosure of Confidential Information shall apply so long as
the information has not properly come into the public domain through no action
of Executive.

B. TRANSFER OF INVENTIONS. Executive, for herself and her heirs and
representatives, will promptly communicate and disclose to the Company, and upon
request will, without additional compensation, execute all papers reasonably
necessary to assign to the Company or the Company's nominees, free of
encumbrance or restrictions, all inventions, discoveries, improvements, whether
patentable or not, conceived or originated by Executive solely or jointly with
others, at the Company's expense or at the Company's facilities, or at the
Company's request, or in the course of her employment, or based on knowledge or
information obtained through her employment during the Term. All such
assignments shall include the patent rights in this and all foreign countries.
Notwithstanding the foregoing, this Section 5(B) shall not apply to any
invention for which no equipment, supplies, facilities or trade secret
information of the Company was used and which was developed entirely on
Executive's own time; and

i. that does not relate:

a. directly to the business of the Company, or

b. to the Company's actual or demonstrably anticipated research
or development; or

ii. that does not result from any work performed by Executive for the
Company.

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<PAGE>

person or firm, whether for compensation or otherwise, except for serving as a
director of another firm.

D. COVENANT NOT TO COMPETE. Executive agrees to be bound and abide by the
following covenants not to compete:

i. TERM AND SCOPE. During her employment with the Company and for a
period of two (2) years after the Term, Executive will not render to
any Conflicting Organization (as hereinafter defined), services,
directly or indirectly, anywhere in the world in connection with any
Conflicting Product, except that Executive may accept employment with a
large Conflicting Organization whose business is diversified (and which
has separate and distinct divisions) if Executive first certifies to
the Board of Directors in writing that she has provided a copy of
Section 5 of this Agreement to such prospective employer, that such
prospective employer is a separate and distinct division of the
Conflicting Organization and that Executive will not render services
directly or indirectly in respect of any Conflicting Product (as
hereinafter defined). Such two-year time period shall be tolled during
any period that Executive is engaged in activity in violation of this
covenant.

ii. JUDICIAL ACTION. Executive and the Company agree that, if the
period of time or the scope of the restrictive covenant not to compete
contained in this Section 5(D) shall be adjudged unreasonable in any
court proceeding, then the period of time and/or scope shall be reduced
accordingly, so that this covenant may be enforced in such scope and
during such period of time as is judged by the court to be reasonable.
In the event of a breach or violation of this Section 5(D) by
Executive, the parties agree than in addition to all other remedies,
the Company shall be entitled to equitable relief for specific
performance, and Executive hereby agrees and acknowledges that the
Company has no adequate remedy at law for the breach of the covenants
contained herein.

iii. DEFINITIONS. For purposes of the covenants contained in this
Section 5(D), the following terms shall have the following meanings:

a. "Conflicting Product" means any product, method or process,
system or service of any person or organization other than the
Company, in existence or under development at the time
Executive's employment with the Company terminates, that is
the same as or substantially or directly competes with a
product, method or process, system or service of or provided
by the Company or any of its affiliates or about which
Executive acquires Confidential Information.

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<PAGE>

iv. DISCLOSURE TO PROSPECTIVE EMPLOYERS. Executive will disclose to any
prospective employer, prior to accepting employment, the existence of
Section 5 of this Agreement. The obligation imposed by this Section
5(D) shall terminate two (2) years after termination of Executive's
employment with the Company; provided, however, the running of such
two-year period shall be tolled to the extent the covenant not to
compete contained in Section 5(D) hereof is tolled.

ARTICLE 6. MISCELLANEOUS

A. NOTICES. Any notice required or permitted to be delivered hereunder shall be
in writing and shall be deemed to be delivered on the earlier of

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i. the date received; or

ii. the date of delivery, refusal or non-delivery indicated on the
return receipt, if deposited in a United States Postal Service
depository, postage prepaid, sent registered or certified mail, return
receipt requested, addressed to the party to receive the same at the
address of such party set forth below:

If to the Company: If to the Executive:

Autologous Wound Therapy, Inc. Robin Lee Geller, Ph.D.
1523 Bowman Road, Suite A c/o Michael J. Caywood, Esq.
Little Rock, Arkansas Dresser, Dresser, Gilbert & Haas, PC
72211 USA 112 South Monroe Street
Sturgis, Michigan
49091 USA

A Party may change its address from time to time by Notice addressed to
the other Party.

C. MODIFICATIONS & WAIVER. No modification of any provision of this Agreement or
waiver of any right or remedy herein provided shall be effective for any purpose
unless specifically set forth in a writing signed by the party to be bound
thereby. No waiver of any right or remedy in respect of any occurrence or event
on one occasion shall be deemed a waiver of such right or remedy in respect of
such occurrence or event on any other occasion.

D. ENTIRE AGREEMENT. This Agreement contains the entire agreement of the parties
with respect to the subject matter hereof and supersedes all other agreements;
oral or written, heretofore made with respect thereto.

E. SEVERABILITY. Any provision of this Agreement prohibited by or unlawful or
unenforceable under any applicable law of any jurisdiction shall as to such
jurisdiction be ineffective without affecting any other provision hereof. To the
full extent, however, that the provisions of such applicable law may be waived,
they are hereby waived, to the end that this Employment Agreement be deemed to
be a valid and binding agreement enforceable in accordance with its terms.

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<PAGE>

G. ASSIGNMENTS. The Company shall have the right to assign this Agreement and to
delegate all rights, duties and obligations hereunder to any entity that
controls the Company, that the Company controls or that may be the result of the
merger, consolidation, acquisition or reorganization of the Company and another
entity. Executive agrees that this Agreement is personal to her and her rights
and interest hereunder may not be assigned, nor may her obligations and duties
hereunder be delegated (except as to delegation in the normal course of
operation of the Company), and any attempted assignment or delegation in
violation of this provision shall be void. Notwithstanding any of the foregoing,
all of Executive's rights and interest hereunder shall be assignable to
Executive's legal representatives, executors or conservators in the event of
Executive's Death or Disability.

IN WITNESS WHEREOF, the parties have executed this Agreement as of the
Effective Date.

Executive Autologous Wound Therapy, Inc.

/s/ Robin Lee Geller By: /s/ Dennis G. Hendren
-------------------- ---------------------
Robin Lee Geller, Ph.D.
Title: /s/ President/CEO
-----------------

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<PAGE>

APPENDIX I

Part A - Bonus and Incentive Plans

1. ANNUAL BONUS. In addition to Executive's Base Salary, the Company shall
pay to the Executive an annual bonus in an initial amount of
Seventy-Five Thousand Dollars ($75,000). The bonus shall be payable
depending on the achievement of the Executive and the Company of a
specified list of performance and payment criteria to be agreed to
between the Executive and the Company and approved by the Company's
Board of Directors. In accordance with the Executive's annual salary
review, the Executive's annual bonus shall be reviewed and increased by
the Company's Board of Directors as may be appropriate.

2. LONG TERM INCENTIVE PROGRAM. During the Term of Executive's employment
by the Company, Executive shall be entitled to participate in the
Company's Executive Long Term Incentive Program which will be
established by the Company's Board of Director's in accordance with a
strategic plan developed for the Company and on appropriate terms and
conditions.

Part B - Employee Benefit Plans and Programs

1. INSURANCE PROGRAM. The Company shall establish for the benefit of the
Executive an insurance program, which shall include, among other
things, life, health, dental and long-term disability coverage. Such
insurance program shall be no less competitive than similar benefit
programs that are established for other health care companies or
comparable industries.

2. PENSION OR PROFIT-SHARING PROGRAMS. In addition to the insurance
program, the Company shall establish a suitable pension, (401(k)) or
other profit sharing program, which shall be no less competitive than
similar pension or profit-sharing programs that are established for
other health care companies or comparable industries.

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<PAGE>
Exhibit 10.7

EMPLOYMENT AGREEMENT

WHEREAS, the Company desires to employ Executive on the terms and
conditions hereinafter set forth;

WHEREAS, the Company recognizes that Executive's employment is critical to
the growth and success of the Company and therefore desires to assure the
Company of Executive's continued employment; and

WHEREAS, based on the foregoing, the Company and Executive wish to enter
into this agreement to come into force as of the Effective Date.

NOW, THEREFORE, in consideration of the promises and the mutual covenants
and agreements herein contained, the Company and Executive hereby agree as
follows:

ARTICLE 1. EMPLOYMENT

A. EMPLOYMENT AND DUTIES. The Company shall employ Executive for the Term (as
hereinafter defined) as Vice President of Strategy and Business Development, to
perform such duties as he shall reasonably be directed by the President to
perform. Executive hereby accepts such employment and agrees to render such
services on behalf of the Company. Executive shall perform his duties and carry
out his responsibilities hereunder in a diligent manner, and shall devote his
exclusive and full working time, attention and effort to the affairs of the
Company, shall use all reasonable efforts to promote the interests of the
Company and shall be just and faithful in the performance of his duties and in
carrying out his responsibilities.

ARTICLE 2. EMPLOYMENT TERM

<PAGE>

ARTICLE 3. COMPENSATION AND BENEFITS

In consideration for performing services on behalf of the Company, the
Executive shall receive the following compensation and benefits:

A. CASH COMPENSATION.

ii. BONUS AND INCENTIVE PLANS. The Company shall establish, and Executive
shall be entitled to participate in, Executive Bonus Compensation and
Long-Term Incentive Programs, which shall be substantially in accordance
with the summary points contained in Part A of Appendix I, attached hereto
and made part hereof.

iii. PARTICIPATION IN BENEFIT PLANS. The Company shall establish, and
Executive shall be entitled to participate in (and to the extent that
Executive's position, title, tenure, salary, age, health, and other
qualifications make him eligible to participate in), employee benefit
plans or programs, which shall be substantially in accordance with the
summary points contained in Part B of Appendix I. The Company does not
guarantee the continuance of any particular employee benefit plan or
program during the Term and Executive's participation in any such plans or
programs shall be subject to all terms, provisions, rules, and regulations
applicable thereto. Executive will be entitled to twenty (20) days of
vacation per year, to be used in accordance with the Company's vacation
policy for senior executives as may be in force from time to time. During
the existence of a Benefit Period, if any, (as hereinafter defined), the
Company will arrange to provide Executive with welfare benefits (including
life and health insurance benefits) of substantially similar design and
cost to Executive as the welfare benefits and other employee benefits
available to Executive prior to Executive's or the Company's, as the case
may be, receipt of Notice of Termination (as hereinafter defined). In the
event that Executive shall obtain full-time employment providing
comparable welfare benefits during the Benefit Period, such benefits as
otherwise receivable hereunder by Executive shall be discontinued.

iv. EXPENSES. The Company will pay or reimburse Executive for all
reasonable and necessary out-of-pocket expenses incurred by him in the
performance of his duties under this Agreement, including first class air
travel and reasonable capital and operating expenses for an office in
Executive's home. Executive shall keep detailed and accurate records of
expenses incurred in connection with the performance of his duties
hereunder

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<PAGE>

and reimbursement therefor shall be in accordance with policies and
procedures to be established from time to time by the Company's Board of
Directors.

i. PERIODIC EXERCISE RIGHTS. Executive's option to purchase shares shall
vest and become fully and freely exercisable with respect to the first
sixty-seven thousand (67,000) shares on December 31, 2000; with respect to
the next sixty-seven thousand (67,000) shares on December 31, 2001, and
with respect to the final sixty-six thousand (66,000) shares on December
31, 2002; subject, however, to the provisions of Sub-section (iii), of
this Section (B):

ii. ACCELERATED EXERCISE RIGHTS. Notwithstanding periodic exercise rights,
all of Executive's options that are not already exercisable in accordance
with Sub-section 3(B)(i) shall become immediately exercisable at such time
that the common stock of the Company trades at or above 37 and 5/8ths
dollars per share (the "Target Price") as quoted on the securities
exchange where the Company stock is currently being traded and during
either of the two periods, chosen at the option of the Executive:

a. the closing price for the stock is at or above the Target Price
for fifteen (15) consecutive trading days; or

b. the closing price for the stock is at or above the Target Price
for twenty (20) out of any thirty (30) consecutive trading days.

The determination of the Target Price during either of such periods shall
be conclusive as reported by any independent financial reporting service,
such as Reuters or Bloomberg Financial Markets.

iii. POST-TERMINATION EXERCISE RIGHTS. Notwithstanding any of the
foregoing, Executive shall have the right to exercise options to purchase
any stock warrants or other stock grants given by the Company in
accordance with the following:

(a) if Executive's employment is terminated for Cause (as defined in
Article 4(A)(ii), hereunder), or in the event that Executive
voluntarily resigns his employment with the Company, vesting of all
options shall cease immediately upon the effective date of
termination or resignation;

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<PAGE>

iv. if Executive's employment is terminated for any reason other than
Death or Disability, or in the event that Executive voluntarily resigns,
then Executive shall have the right to exercise all options that have
already vested as of the effective date of termination or resignation (or
that become vested by reason of termination or resignation) during a
period of ninety (90) days following the effective date of termination or
resignation.

iv. ISSUANCE OF REGISTERED SHARES. The Company hereby guarantees that it
will issue registered common stock (the term "registered" as defined in
the Securities and Exchange Act of 1934) to the Executive pursuant to the
exercise of his options under Sub-sections (i) - (iii) of this Section
3(B). In the event that the Company does not have sufficient quantities of
registered shares available to satisfy this obligation, it shall
immediately take all steps necessary to issue a registration statement and
to make sufficient registered shares available in satisfaction of this
Sub-section (iv).

v. DILUTION. In the event that the Company issues new or additional equity
securities, debt securities convertible into equity, declares a stock
dividend, stock split, grants stock rights, or performs any other action
that would reasonably be expected to reduce the value of the warrants, the
Company shall immediately reduce the purchase price, increase number of
the warrants, or both, so that value of the warrants granted to Executive
remains unchanged.

vi. EXPIRATION DATE. The options to purchase shares shall expire ten (10)
years from the date each option becomes exercisable.

ARTICLE 4. TERMINATION OF EMPLOYMENT

A. DEFINITIONS. The following terms shall have the definitions as described
in this Section A:

i. "Benefit Period" shall mean:

a. the twenty-four (24) month period commencing on the Date of
Termination which occurs in connection with a termination of
employment described in the first sentence of Section 4(E)(i); or

b. the period consisting of the remainder, if any, of the then
current Term in which occurs a termination of employment described in
the first sentence of Section 4(E)(ii), plus the immediately
succeeding twenty-four (24) month period.

Page 4

<PAGE>

ii. "Cause" shall mean any of the following:

a. any act or failure to act (or series or combination thereof) by
Executive done with the intent to harm in any material respect to the
interests of the Company;

b. the commission by Executive of a felony involving moral turpitude;

c. the perpetration by Executive of a dishonest act or common law
fraud against the Company or any subsidiary thereof;

d. a grossly negligent act or failure to act (or series or
combination thereof) by Executive detrimental in any material respect
to the interests of the Company;

e. the material breach by Executive of his agreements or obligations
under this Agreement; or

f. the continued refusal to follow the directives of the President or
Board of Directors that are consistent with Executive's duties and
responsibilities identified in Section 1(A) hereof.

iii. A "Change of Control" shall mean any of the following:

a. a sale of all or substantially all of the assets of the Company;

b. the acquisition of more than eighty percent (80%) of the Common
Stock of the Company (with all classes or series thereof treated as a
single class) by any person or group of persons, except a Permitted
Shareholder (as hereinafter defined), acting in concert. A "Permitted
Shareholder" means a holder, as of the date the Stock Option Plan was
adopted by the Company, of Common Stock;

c. a reorganization of the Company wherein the holders of Common
Stock of the Company receive stock in another company, a merger of
the Company with another company wherein there is an eighty percent
(80%) or greater change in the ownership of the Common Stock of the
Company as a result of such merger, or any other transaction in which
the Company (other than as the parent corporation) is consolidated
for federal income tax purposes or is eligible to be consolidated for
federal income tax purposes with another corporation;

Page 5
<PAGE>

e. a majority of the Board of Directors is not comprised of
Continuing Directors. A "Continuing Director" means a director
recommended by the Board of Directors of the Company for election as
a director of the Company by the stockholders; or

f. the Board of Directors of the Company, in its sole and absolute
discretion, determines that there has been a sufficient change in the
share ownership of the Company to constitute a change of effective
ownership or control of the Company.

iv. "Good Reason" shall mean the occurrence of any one or more of the
following events during the Term:

a. the assignment to Executive of any duties inconsistent in any
respect with Executive's position (including status, offices, title,
and reporting requirements), authority, duties or other
responsibilities or any other action of the Company that results in a
diminishment in such position, authority, duties or responsibilities,
other than an insubstantial and inadvertent action that is remedied
by the Company promptly after receipt of notice thereof given by
Executive;

b. a reduction by the Company in Executive's Base Salary as in effect
on the Effective Date and as the same shall be increased from time to
time hereafter;

c. the Company's requiring Executive to be based at a location in
excess of fifteen (15) miles from the location of Executive's
principal residence without the consent of Executive;

d. the failure by the Company to: (a) continue in effect any material
compensation or benefit plan, program, policy or practice in which
Executive was participating during the Term of his employment or at
the time of a Change of Control; or (b) provide Executive with
compensation and benefits at least equal (in terms of benefit levels
and/or reward opportunities) to those provided for under each
employee benefit plan, program, policy and practice as in effect
immediately prior to a Change of Control (or as in effect following
the Change of Control, if greater);

e. the failure of the Company to obtain a satisfactory agreement from
any successor to the Company to assume and agree to perform this
Agreement; or

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<PAGE>

f. any purported termination by the Company of Executive's employment
that is not effected pursuant to a Notice of Termination (as defined
below).

v. "Date of Termination" shall mean the date specified in the Notice of
Termination (as hereinafter defined) (except in the case of Executive's
death, in which case Date of Termination shall be the date of death);
provided, however, that if Executive's employment is terminated by the
Company other than for Cause, the date specified in the Notice of
Termination shall be at least thirty (30) days from the date the Notice of
Termination is given to Executive and if Executive's employment is
terminated by Executive for Good Reason, the date specified in the Notice
of Termination shall not be more than sixty (60) days from the date the
Notice of Termination is given to the Company.

vi. "Notice of Termination" shall mean a written notice either from the
Company to Executive, or Executive to the Company, that indicates Section
2 or the specific provision of Section 4 of this Agreement relied upon as
the reason for such termination or non-renewal, the Date of Termination,
and, in reasonable detail, the facts and circumstances claimed to provide
a basis for termination or non-renewal pursuant to Section 2 or this
Section 4 of this Agreement.

i. a period of six (6) consecutive months; or

ii. for shorter periods aggregating six (6) months during any twelve (12)
month period;

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<PAGE>

Company) relating to such Change of Control shall be deemed to have
occurred after the Change of Control for the purposes of this Agreement.

D. COMPANY'S AND EXECUTIVE'S RIGHT TO TERMINATE FOLLOWING A CHANGE OF CONTROL.
Following a Change of Control, this Agreement and Executive's employment
hereunder may be terminated at any time:

i. by the Company, with or without Cause, upon thirty (30) days prior
written notice to Executive, or

ii. by Executive for Good Reason upon thirty (30) days prior written
notice to the Company. Executive's right to terminate his employment
pursuant to this Section 4(D) shall not be affected by incapacity due to
physical or mental illness. Executive's continued employment following a
Change of Control shall not constitute consent to, or a waiver of, rights
with respect to, any circumstance constituting Good Reason hereunder.

E. COMPENSATION UPON TERMINATION.

i. TERMINATION PRIOR TO CHANGE OF CONTROL. In the event the Company
terminates (or elects not to renew) this Agreement without Cause, and such
termination (or non-renewal) without Cause occurs prior to any Change of
Control, Executive shall be entitled to receive his Base Salary through
the Date of Termination, the welfare benefits described in Section
3(A)(iii) for the Benefit Period, and not later than thirty (30) days
after the Date of Termination, a lump sum severance payment equal to the
product of two (2) times the sum of Executive's then-current Base Salary
plus the arithmetic average of payments made to Executive pursuant to the
Company's Executive Bonus Compensation Program with respect to the three
(3) fiscal years immediately preceding the fiscal year in which the Date
of Termination occurs. In addition to the foregoing, to the extent not
otherwise required under the Company's Stock Option Plan or any award
agreement with Executive, any unvested stock option awards theretofore
awarded to Executive shall vest and become exercisable on the Date of
Termination. In the event this Agreement is terminated (or not renewed)
for any reason other than by the Company without Cause, and such
termination (or non-renewal) occurs prior to a Change of Control,
Executive shall not be entitled to the continuation of any compensation,
bonuses or benefits provided hereunder, or any other payments following
the Date of Termination, other than Base Salary earned through such Date
of Termination.

ii. TERMINATION FOLLOWING CHANGE OF CONTROL. If this Agreement is
terminated (or not renewed)

a. by the Company without Cause; or

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<PAGE>

b. by the Executive for Good Reason during the twelve (12) month
period immediately following a Change of Control, and such
termination (or non-renewal) occurs following a Change of
Control;

then, the Executive shall be entitled to receive his full Base
Salary through the Date of Termination, the welfare benefits
described in Section 3(A)(iii) for the Benefit Period and, not
later than thirty (30) days after the Date of Termination, a lump
sum severance payment equal to the sum of the Base Salary which
would otherwise have been payable for the remainder (if any) of
the then current Term, plus an amount equal the product of two
(2) times the sum of Executive's then current annual Base Salary
plus the arithmetic average of payments made to Executive
pursuant to the Company's Executive Bonus Compensation Program
with respect to the three (3) fiscal years immediately preceding
the fiscal year in which the Date of Termination occurs.

In addition to the foregoing, to the extent not otherwise
required under the Company's Stock Option Plan or any other award
agreement with Executive, any unvested stock option awards
theretofore awarded to Executive shall vest and become
immediately exercisable in full. In the event this Agreement is
terminated (or not renewed) for any reason other than by the
Company without Cause, or by Executive for Good Reason, and such
termination (or non-renewal) occurs following a Change of
Control, Executive shall not be entitled to the continuation of
any compensation, bonuses or benefits provided hereunder, or any
other payments following the Date of Termination, other than Base
Salary earned through the Date of Termination.

ARTICLE 5. EMPLOYMENT COVENANTS

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<PAGE>

information of any nature whatsoever disclosed to or developed by him or to
which he had access as a result of his employment (hereinafter referred to as
"Confidential Information"). Such Confidential Information shall include
technical and business information, including, but not limited to, inventions,
research and development, engineering, products, designs, manufacture, methods,
systems, improvements, trade secrets, formulas, processes, marketing,
merchandising, selling, licensing, servicing, customer lists, records or
financial information, manuals or Company strategy concerning its business,
strategy or policies. Executive agrees that all Confidential Information shall
remain the sole and absolute property of the Company. During the course of his
employment, Executive shall not use, disclose, disseminate, publish, reproduce
or otherwise make available such Confidential Information to any person, firm,
corporation or other entity, except for the purpose of conducting business on
behalf of the Company. Following the Term, Executive shall not use, disclose,
disseminate, publish, reproduce, or otherwise make available such Confidential
Information to any person, firm, corporation, or other entity. Upon termination
of his employment with the Company, Executive will leave with or deliver to the
Company all records and any compositions, articles, devices, equipment and
other items which disclose or embody Confidential Information including all
copies or specimens thereof, whether prepared by his or by others. The
foregoing restrictions on disclosure of Confidential Information shall apply so
long as the information has not properly come into the public domain through no
action of Executive.

i. that does not relate:

a. directly to the business of the Company, or

b. to the Company's actual or demonstrably anticipated research
or development; or

ii. that does not result from any work performed by Executive for the
Company.

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<PAGE>

person or firm, whether for compensation or otherwise, except for serving as a
director of another firm.

D. COVENANT NOT TO COMPETE. Executive agrees to be bound and abide by the
following covenants not to compete:

iii. DEFINITIONS. For purposes of the covenants contained in this
Section 5(D), the following terms shall have the following meanings:

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<PAGE>

ARTICLE 6. MISCELLANEOUS

A. NOTICES. Any notice required or permitted to be delivered hereunder shall be
in writing and shall be deemed to be delivered on the earlier of:

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<PAGE>

i. the date received; or

If to the Company: If to the Executive:

Autologous Wound Therapy, Inc. Christopher J. Caywood
1523 Bowman Road, Suite A c/o Michael J. Caywood, Esq.
Little Rock, Arkansas Dresser, Dresser, Gilbert & Haas, PC
72211 USA 112 South Monroe Street
Sturgis, Michigan
49091 USA

A Party may change its address from time to time by Notice addressed
to the other Party.

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<PAGE>

IN WITNESS WHEREOF, the parties have executed this Agreement as of the
Effective Date.

Executive Autologous Wound Therapy, Inc.

/s/ Christopher Caywood By: /s/ Dennis G. Hendren
------------------------ --------------------------------
Christopher J. Caywood Title: President/CEO

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<PAGE>

APPENDIX I

Part A - Bonus and Incentive Plans

Part B - Employee Benefit Plans and Programs

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<PAGE>
Exhibit 10.8

EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT (the "Agreement") is made effective as of
March 3, 2000 (the "Effective Date"), between AUTOLOGOUS WOUND THERAPY, INC., a
Delaware corporation (the "Company"), and DAVID C. DEMAREST ("Executive").

WHEREAS, the Company desires to employ Executive on the terms and
conditions hereinafter set forth;

WHEREAS, the Company recognizes that Executive's employment is critical to
the growth and success of the Company and therefore desires to assure the
Company of Executive's continued employment; and

WHEREAS, based on the foregoing, the Company and Executive wish to enter
into this agreement to come into force as of the Effective Date.

NOW, THEREFORE, in consideration of the promises and the mutual covenants
and agreements herein contained, the Company and Executive hereby agree as
follows:

ARTICLE 1. EMPLOYMENT

A. EMPLOYMENT AND DUTIES. The Company shall employ Executive for the Term (as
hereinafter defined) as Vice President, Secretary and General Counsel, to
perform such duties as he shall reasonably be directed by the President to
perform. Executive hereby accepts such employment and agrees to render such
services on behalf of the Company. Executive shall perform his duties and carry
out his responsibilities hereunder in a diligent manner, and shall devote his
exclusive and full working time, attention and effort to the affairs of the
Company, shall use all reasonable efforts to promote the interests of the
Company and shall be just and faithful in the performance of his duties and in
carrying out his responsibilities.