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Exhibit 10.17    
    

Watson Pharmaceuticals, Inc.
  2001 INCENTIVE AWARD PLAN

NOTICE OF GRANT AND SIGNATURE PAGE  

        Congratulations, you ("Holder") have been granted an option to purchase Common Stock of Watson Pharmaceuticals, Inc., a Nevada corporation (the "Company").
The Option is subject to the terms and conditions of the Award Agreement and the 2001 Incentive Award Plan of the Company, as amended from time to time (the "Plan"), which are attached hereto as
Exhibit 1-A and 1-B, and of which this Notice of Grant and Signature Page is a part. By signing this Notice of Grant and Signature Page, you represent and warrant to the
Company that you have read the Award Agreement and the Plan and agree to be bound by their terms. Capitalized terms not otherwise defined in this Notice of Grant and Signature Page shall be as defined
in the Plan and the Award Agreement. 

        Subject
to the terms of the Award Agreement and the Plan, the terms of this Option are set forth below: 

	Type of Option: Non-Qualified Stock Option	 	 	 	 
	 	 	 	 	 
	Holder's Name: [First Name and Last Name]	 	Total Number of Option Shares:	 
	 	 	 	 	

	Date of Grant: [Month, Day, Year]	 	 	Purchase Price Per Share:	$

        Subject
to the terms of the Award Agreement and the Plan, this Option shall become exercisable in accordance with the following schedule: 

	On and After This Date
 
	 	This Option Shall be Exercisable With Respect to

the Following Number of Shares in Each Period

Becoming Fully Vested on the Date Shown.

	Month, Day, Year	 	Number
	Month, Day, Year	 	Number
	Month, Day, Year	 	Number
	Month, Day, Year	 	Number
	Month, Day, Year	 	Number
	 	 	

	 	Total Shares	 	Total

NOTE, schedule does not reflect cumulative vesting.

        IN
WITNESS WHEREOF, the Company has granted this Option, subject to the terms set forth herein, or the date of grant specified above. 

	 	 	WATSON PHARMACEUTICALS, INC.
	

 	
 	

 
	 	 	
 Allen Chao, Ph.D.,

Chairman and Chief Executive Officer
	ACCEPTED:	 	 
	

 	
 	

 
	
 Holder's Signature	 	 
	

 	
 	

 
	
	 	 
	

 	
 	

 
	
 Address	 	 
	

 	
 	

 
	
 Holder's Taxpayer Identification Number	 	

GRANT NO: 0000XXXX
	

 	
 	
Note: This document constitutes the Company's offer to enter into an agreement under the terms set forth herein. This offer will expire without further notice at 5 o'clock Pacific Time
sixty days after the date of grant of the Option set forth above, unless this offer is accepted by Holder by the delivery of this original Notice of Grant and Signature Page, executed by Holder to the Company on or prior to the offer's
expiration date.

 
EXHIBIT 1-A  

 AWARD AGREEMENT  

        THIS AWARD AGREEMENT, dated as of the Date of Grant appearing on the Notice of Grant and Signature Page hereof, is made by and between Watson
Pharmaceuticals, Inc., a Nevada corporation (the "Company"), and the Director whose name and signature appear on the Notice of Grant and Signature Page hereof (the "Holder"). 

        WHEREAS,
the Company wishes to grant the Holder an option (the "Option") to purchase shares of its common stock, par value $.0033 per share (the "Common Stock"), pursuant to the terms of
the Notice of Grant and Signature Page, this Agreement and the 2001 Incentive Award Plan of Watson Pharmaceuticals, Inc., as amended from time to time (the terms of which are hereby
incorporated by reference and made a part of this Agreement, the "Plan"); and 

        WHEREAS,
it has been determined that it would be to the advantage and best interest of the Company and its stockholders to grant Holder the Option as an inducement to enter into or
remain in
the service of the Company or its Subsidiaries and as an incentive for increased efforts during such service. 

        NOW,
THEREFORE, in consideration of the mutual covenants herein contained and other good and valuable consideration, receipt of which is hereby acknowledged, the parties hereto do hereby
agree as follows: 

ARTICLE I
 GRANT OF OPTION  

        Section 1.1—Grant of Option and Purchase Price.    The
Company grants to Holder the option to purchase any part or all of an aggregate of that many shares of Common Stock as set forth on the Notice of Grant and Signature Page hereto, upon the terms and
conditions set forth in this Agreement. The per share purchase price of the shares of Common Stock covered by the Option shall be as set forth on the Notice of Grant and Signature Page hereto, without
commission or other charge. 

        Section 1.2—Consideration to Company.    In consideration of
the granting of this Option by the Company, the Holder agrees to render faithful and efficient services to the Company, with such duties and responsibilities as the Company shall from time to time
prescribe, for a period of at least one (1) year from the date this Option is granted. Nothing in this Agreement or in the Plan shall confer upon the Holder any right to continue as a Director
of the Company. 

ARTICLE II
 PERIOD OF EXERCISABILITY  

        Section 2.1—Exercisability.    Subject to Section 2.2
and Section 4.5, the Option shall become exercisable as set forth in the Notice of Grant and Signature Page hereto. No portion of the Option which is unexercisable at Termination of
Directorship shall thereafter become exercisable. Each such installment which becomes exercisable pursuant to this Section 2.1 shall remain exercisable until it becomes unexercisable under
Section 2.2 or the Plan. 

        Section 2.2—Expiration of Option.    The Option may not be
exercised to any extent by anyone after the first to occur of the following events: 

        (a)   The
expiration of ten (10) years from the date the Option was granted; 

        (b)   Except
in the case of the Holder's disability (within the meaning of Section 22(e)(3) of the Code) or as set forth in Sections 2.2(d), the expiration of three
(3) months from the date of the Holder's Termination of Directorship, unless the Holder dies within said three month period; 

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        (c)   In
the case of the Holder's disability (within the meaning of Section 22(e)(3) of the Code), the expiration of one (1) year from the date of the Holder's
Termination of Directorship by reason of the Holder's disability; or 

        (d)   The
expiration of one (1) year from the date of the Holder's death. 

ARTICLE III
 EXERCISE OF OPTION  

        Section 3.1—Person Eligible to Exercise.    During the
lifetime of the Holder, only Holder may exercise the Option or any portion thereof. After the death of Holder, any exercisable portion of the Option may, prior to the time when the Option becomes
unexercisable under Section 2.2 or the Plan, be exercised by Holder's personal representative or by any person empowered to do so under the deceased Holder's will or under the then applicable
laws of descent and distribution. 

        Section 3.2—Partial Exercise.    Any exercisable portion of
the Option or the entire Option, if then wholly exercisable, may be exercised in whole or in part as to whole shares only at any time prior to the time when the Option or portion thereof becomes
unexercisable under Section 2.2 or the Plan. 

        Section 3.3—Manner of Exercise.    The Option, or any
exercisable portion thereof, may be exercised solely by delivery to the Secretary of the Company, or such other person or entity designated by the Committee, or his, her or its office, as applicable,
of all of the following prior to the time when the Option or such portion becomes unexercisable under Section 2.2 or the Plan: 

        (a)   A
written notice complying with the applicable rules established by the Committee stating that the Option, or a portion thereof, is exercised. The notice shall be signed
by the Holder or other person then entitled to exercise the Option or such portion; and 

        (b)   (i) Full
cash payment to the Secretary of the Company for the shares with respect to which such Option or portion is exercised; 

        (ii)   With
the consent of the Committee (which consent may be withheld in its sole and absolute discretion), (A) shares of the Company's Common Stock owned by the
Holder, duly endorsed for transfer to the Company, with a Fair Market Value on the date of delivery equal to the aggregate exercise price of the Option or exercised portion thereof, or
(B) shares of the Company's Common Stock issuable to the Holder upon exercise of the Option, with a Fair Market Value on the date of delivery equal to the aggregate exercise price of the Option
or exercised portion thereof; 

        (iii)  With
the consent of the Committee (which consent may be withheld in its sole and absolute discretion), a notice that the Holder has placed a market sell order with a
broker with respect to shares of the Company's Common Stock then issuable upon exercise of the Option, and that the broker has been directed to pay a sufficient portion of the net proceeds of the sale
to the Company in satisfaction of the Option exercise price; or 

        (iv)  With
the consent of the Committee (which consent may be withheld in its sole and absolute discretion), any combination of the consideration provided in the foregoing
subparagraphs (i), (ii) and (iii); and 

        (c)   Full
payment to the Company (or other employer corporation) of all amounts which, under federal, state or local tax law, it is required to withhold upon exercise of the
Option. With the consent of the Committee (which consent may be withheld in its sole and absolute discretion), all or part of such payment may be made in the form of (i) shares of the Company's
Common Stock owned by Holder, duly endorsed for transfer, with a Fair Market Value equal to the sums required to be withheld, or (ii) shares of the Company's Common Stock issuable to Holder
upon 

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exercise
of the Option with a Fair Market Value equal to the sums required to be withheld; provided, that the number of shares of Common Stock which may
be withheld with respect to the issuance, vesting, exercise or payment of any Option (or which may be repurchased from the Optionee of such Option within six months after such shares of Common Stock
were acquired by the Optionee from the Company) in order to satisfy the Optionee's federal and state income and payroll tax liabilities with respect to the issuance, vesting, exercise or payment of
the Option shall be limited to the number of shares which have a Fair Market Value on the date of withholding or repurchase equal to the aggregate amount of such liabilities based on the minimum
statutory withholding rates for federal and state tax income and payroll tax purposes that are applicable to such supplemental taxable income; and 

        (d)   In
the event the Option or portion shall be exercised pursuant to Section 3.1 by any person or persons other than the Holder, appropriate proof of the right of
such person or persons to exercise the Option. 

        Section 3.4—Conditions to Issuance of Stock
Certificates.    The shares of stock deliverable upon the exercise of the Option, or any portion thereof, may be either previously authorized but unissued shares or,
to the extent applicable to the Company, issued shares which have then been reacquired by the Company. Such shares shall be fully paid and nonassessable. The Company shall not be required to issue or
deliver any certificate or certificates for shares of stock purchased upon the exercise of the Option or portion thereof prior to fulfillment of all of the following conditions: 

        (a)   The
admission of such shares to listing on all stock exchanges on which such class of stock is then listed; and 

        (b)   The
completion of any registration or other qualification of such shares under any state or federal law or under rulings or regulations of the Securities and Exchange
Commission or of any other governmental regulatory body, which the Committee shall, in its absolute discretion, deem necessary or advisable; and 

        (c)   The
obtaining of any approval or other clearance from any state or federal governmental agency which the Committee shall, in its absolute discretion, determine to be
necessary or advisable; and 

        (d)   The
lapse of such reasonable period of time following the exercise of the Option as the Committee may from time to time establish for reasons of administrative
convenience; and 

        (e)   The
receipt by the Company of full payment for such shares, including payment of all amounts which, under federal, state or local tax law, the Company (or other employer
corporation) is required to withhold upon exercise of the Option. 

        Section 3.5—Rights as Stockholder.    The Holder shall not
be, nor have any of the rights or privileges of, stockholder of the Company in respect of any shares purchasable upon the exercise of any part of an Option unless and until certificates representing
such shares have been issued by the Company to the Holder. 

ARTICLE IV
 OTHER PROVISIONS  

        Section 4.1—Administration.    The Committee shall have the
power to interpret the Plan and this Agreement, and to adopt such rules for the administration, interpretation and application of the Plan as are consistent therewith, to interpret, amend or revoke
any such rules and to amend this Agreement provided that the rights or obligations of the Holder are not affected adversely. Any grant or award under the Plan need not be the same with respect to each
holder. All actions taken and all interpretations and determinations made by the Committee in good faith shall be final and binding 

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upon
the Holder, the Company and all other interested persons. No member of the Committee shall be personally liable for any action, determination or interpretation made in good faith with respect to
the Plan or the Option. In its absolute discretion, the Board may at any time and from time to time exercise any and all rights and duties of the Committee under the Plan and this Agreement except
with respect to matters which under Rule 16b-3 or Section 162(m) of the Code, or any regulations or rules issued thereunder, are required to be determined in the sole
discretion of the Committee. In addition, the Committee has the authority, in its discretion, to delegate all or any part of its responsibilities and powers under this Agreement to any person or
persons selected by it. 

        Section 4.2—Option Not Transferable.    Neither the Option
nor any interest or right therein or part thereof shall be sold, pledged, assigned or transferred in any manner other than by will or the laws of descent and distribution or, subject to the consent of
the Administrator, pursuant to a DRO, unless and until the shares underlying such Option have been issued. Neither the Option nor any interest or right therein or part thereof shall be liable for the
debts, contracts or engagements of the Holder or his successors in interest or shall be subject to disposition by transfer, alienation, anticipation, pledge, encumbrance, assignment or any other means
whether such disposition be voluntary or involuntary or by operation of law by judgment, levy, attachment, garnishment or any other legal or equitable proceedings (including bankruptcy), and any
attempted disposition thereof shall be null and void and of no effect, except to the extent that such disposition is permitted by the preceding sentence. 

        During
the lifetime of the Holder, only he may exercise an Option (or any portion thereof) granted to him under the Plan, unless it has been disposed of with the consent of the
Administrator pursuant to a DRO. After the death of the Holder, any exercisable portion of an Option may, prior to the time when such portion becomes unexercisable under the Plan or this Agreement, be
exercised by his personal representative or by any person empowered to do so under the deceased Holder's will or under the then applicable laws of descent and distribution. 

        Section 4.3—Notices.    Any notice to be given under the
terms of this Agreement to the Company shall be addressed to the Company in care of its Secretary, and any notice to be given to the Holder shall be addressed to him at the address given beneath his
signature hereto. By a notice given
pursuant to this Section 4.3, either party may hereafter designate a different address for notices to be given to him. Any notice which is required to be given to the Holder shall, if the
Holder is then deceased, be given to the Holder's personal representative if such representative has previously informed the Company of his status and address by written notice under this
Section 4.3. Any notice shall be deemed duly given when enclosed in a properly sealed envelope or wrapper addressed as aforesaid, deposited (with postage prepaid) in a post office or branch
post office regularly maintained by the United States Postal Service. 

        Section 4.4—Titles and Construction.    Titles are provided
herein for convenience only and are not to serve as a basis for interpretation or construction of this Agreement. This Agreement shall be administered, interpreted and enforced under the internal laws
of the State of California, without regard to conflicts of laws thereof. 

        Section 4.5—Conformity to Securities Laws.    The Holder
acknowledges that the Plan is intended to conform to the extent necessary with all provisions of the Securities Act and the Exchange Act and any and all regulations and rules promulgated by the
Securities and Exchange Commission thereunder, including without limitation Rule 16b-3. Notwithstanding anything herein to the contrary, the Plan shall be administered, and the
Option is granted and may be exercised, only in such a manner as to conform to such laws, rules and regulations. To the extent permitted by applicable law, the Plan and this Agreement shall be deemed
amended to the extent necessary to conform to such laws, rules and regulations. 

ARTICLE V
 DEFINITIONS  

        All capitalized terms used herein without definition shall have the meanings ascribed to such terms in the Plan. 

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EXHIBIT 1-B  

 2001 INCENTIVE AWARD PLAN  

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Exhibit 10.12  

 
 

EMPLOYMENT AGREEMENT    
    

        THIS EXECUTIVE EMPLOYMENT AGREEMENT (this "Agreement") dated as of September 1, 2004, is by and between Isolagen, Inc., a Delaware corporation (together with its
subsidiaries, the "Company" or "Isolagen"), and Robert Bitterman, an individual residing in Radnor Township, Pennsylvania (the "Executive"). 

W I T N E S S E T H:  

        WHEREAS, the Executive desires to serve the Company as its President and Chief Executive Officer; and 

        WHEREAS,
the Company desires to employ Executive as its President and Chief Executive Officer; 

        NOW
THEREFORE in consideration of the mutual benefits to be derived from this Agreement, the Company and the Executive hereby agree as follows: 

1.     Term of Employment; Office and Duties.  

        (a)   Commencing
on September 1, 2004 (the "Employment Date"), and for an initial term ending December 31, 2007, the Company shall employ the Executive as a
senior executive of the Company with the title of President and Chief Executive Officer, with the duties and responsibilities prescribed for such offices in the Bylaws of the Company and such
additional duties and responsibilities consistent with such positions as may from time to time be assigned to the Executive by the Board of Directors. Specifically included in the Executive's
responsibilities shall be the identification, recruitment and retention of the members of the senior management team of the Company, with the advice and consent of the Board of Directors. Executive
agrees to perform such duties and discharge such responsibilities in accordance with the terms of this Agreement. This Agreement shall be renewed for an additional one (1) year term, by the
mutual written agreement of the Executive and the Company at least thirty (30) days prior to its expiration. 

        (b)   The
Executive shall devote substantially all of his working time to the business and affairs of the Company other than during vacations of four weeks per year and
periods of illness or incapacity; provided, however, that nothing in this Agreement shall preclude the Executive from devoting time required: (i) for serving as a director or officer of any
organization or entity not in a competing business with the Company, and any other businesses in which the Company becomes involved; (ii) delivering lectures, writing articles or books, or
fulfilling speaking engagements; or (iii) engaging in charitable and community activities provided that such activities do not interfere with the performance of his duties hereunder. 

        (c)   The
Board of Directors shall appoint Executive to serve on the Board of directors within thirty (30) days of the employment Date. 

        (d)   The
Company agrees that Executive may move to promptly establish executive offices of the Company for a senior management team in the Philadelphia, Pennsylvania, area,
at a location to be approved by the Board of Directors. 

2.     Compensation and Benefits.  

        For
all services rendered by the Executive in any capacity during the period of Executive's employment by the Company, including without limitation, services as an executive officer or
member 

 

of
any committee of the Board of Directors or any subsidiary, affiliate or division thereof, from and after the Effective Date, the Executive shall be compensated as follows: 

        (a)   Base Salary. The Company shall pay the Executive a fixed salary ("Base Salary") at a rate of Four Hundred Thousand
Dollars ($400,000) per year. The Board of Directors may periodically review the Executive's Base Salary and may determine to increase (but not decrease) the Executive's salary, in accordance with such
policies as the Company may hereafter adopt from time to time, if it deems appropriate. Base Salary will be payable in accordance with the customary payroll practices of the Company. 

        (b)   Bonus. Executive shall be entitled to a one-time bonus in the amount of $50,000, payable to Executive within thirty (30)
days of his commencement of service as President and Chief Executive Officer. Beginning in fiscal year 2005, Executive will also be entitled to receive an annual bonus (the "Annual Bonus"), payable
each year subsequent to the issuance of final audited financial statements, but in no case later than 120 days after the end of the Company's most recently completed fiscal year. The final
determination on the amount of the Annual Bonus will be made by the Compensation Committee of the Board of Directors, based primarily on mutually agreed upon criteria, established with respect to the
ensuing fiscal year, within thirty (30) days of the end of each fiscal year. The Compensation Committee may also consider other more subjective factors in making its determination. The targeted amount
of the Annual Bonus shall be 50% of the Executive's base salary. The actual Annual Bonus for any given period may be higher or lower than 50%. 

        (c)   Fringe Benefits, Option Grants and Miscellaneous Employment Matters.

          (i)  The
Executive shall be entitled to participate in such disability, health and life insurance and other fringe benefit plans or programs offered to all employees of the
Company, as well as to the key executive employees of Company, including a Section 401(k) and retirement plan of the Company as may be established from time to time by the Board of Directors,
subject to the rules and regulations applicable thereto. In addition, the Executive shall be entitled to the following benefits. 

         (ii)  Contemporaneous
with the execution of this Agreement, the Executive will be granted a non-qualified stock option (the "Employment Option") to purchase 500,000 shares of
the Company's Common Stock, par value $.001 per share (the "Common Stock") with an exercise price per share equal to the average closing transaction price on the ten trading days preceding the grant.
In the Company's discretion, the Employment Option may be issued pursuant to the Company's existing stock option plans or apart from those plans. The term of the Employment Option will be for a period
of five (5) years from the date of grant. The shares eligible for purchase under the Employment Option grant vest ratably, on a monthly basis over the three years following the Employment Date;
provided, however, that if Executive's employment with the Company is terminated (i) without "Cause" or (ii) "For Good Reason," all unvested portions of the Employment Option shall vest
immediately upon such termination. 

        (iii)  On
or before September 1, 2005, the Company will grant to Executive an additional non-qualified stock option (the "Additional Employment Option") to purchase
166,666 shares of the Company's Common Stock with an exercise price per share equal to the average closing transaction price on the ten trading days preceding the grant, provided that Executive has
satisfied the conditions that will be agreed to by the Company and Executive in writing on or before March 31, 2005. In the Company's discretion, the Additional Employment Option may be issued
pursuant to the Company's existing stock option plans or apart from those plans. To the extent eligible and available, the Additional Employment Option will be Incentive Stock Options. The term of the
Additional Employment Option will be for a period of five (5) years 

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from
the date of grant. The shares eligible for purchase under the Employment Option grant vest ratably, on a monthly basis over the three years following the date of grant of the Additional
Employment Option; provided, however, that if Executive's employment with the Company is terminated (i) without "Cause" or (ii) "For Good Reason," all unvested portions of the Additional
Employment Option, once granted, shall vest immediately upon such termination. 

        (iv)  The
vesting of the Employment Option and the Additional Employment Option shall accelerate and vest immediately upon a change in control of the Company as defined in
Rule 405 of the Securities Act of 1933 or upon sale of substantially all of the assets of the Company or the merger out of existence of the Company. 

        (d)   Withholding and Employment Tax. Payment of all compensation hereunder shall be subject to customary withholding tax and
other employment taxes as may be required with respect to compensation paid by an employer/corporation to an employee. 

        (e)   Disability. The Company shall provide the Executive with a policy of disability insurance benefits of at least sixty
percent (60%) of his gross Base Salary per month. To the extent permitted by the Company's existing disability policy, the Executive's disability policy will be a portable policy. The Executive agrees
to pay for any additional premium payments resulting from providing a portable policy (in comparison to a group policy) and further agrees to have the additional premium payments deducted from his
pay. In the event of the Executive's Disability (as hereinafter defined), the Executive and his family shall continue to be covered by all of the Company's life, medical, health and dental plans, at
the Company's expense, to the extent such benefits can be obtained at a reasonable cost, for the lesser of the term of such Disability (as hereinafter defined) or eighteen (18) months, in accordance
with the terms of such plans. 

        (f)    Death. The Company shall provide the Executive with a policy of life insurance benefits in the amount of at least Two
Million Dollars ($2,000,000). To the extent permitted by the Company's existing life insurance policy, the Executive's life insurance policy will be a portable policy. The Executive agrees to pay for
any additional premium payments resulting from providing a portable policy (in comparison to a group policy) and further agrees to have the additional premium payments deducted
from his pay. In the event of the Executive's death, the Executive's family shall continue to be covered by all of the Company's medical, health and dental plans, at the Company's expense, to the
extent such benefits can be obtained at a reasonable cost, for eighteen (18) months following the Executive's death in accordance with the terms of such plans. 

        (g)   Vacation. Executive shall receive four (4) weeks of vacation annually, administered in accordance with the Company's
existing vacation policy. 

        (h)   Relocation. The Company shall reimburse Executive for all reasonable costs incident to relocating Executive and
Executive's family (and their household), and provided that they are deductible by the Company against its taxable income, if at any time during the term of employee's employment by the Company the
parties shall agree to a relocation to an area greater than fifty miles from the Executive's current residence. These costs shall include, but not be limited to, the costs of packing and moving the
household goods, the closing costs and realtor fees associated with the sale of the Executive's residence in Pennsylvania, as well as unpacking of the household goods and all closing costs on
Executive's residence at the new location. 

        (i)    Temporary Living. In the event of a relocation as described above, the Company will provide up to 6 months of temporary
living accommodations for Executive and his family. These accommodations will be appropriate to Executive's needs and the demands of the business. 

        (j)    Travel. It is anticipated that Executive will be engaged in regular travel between Philadelphia and Houston. The Company
agrees to reimburse all expenses related to such travel 

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for
all members of Executive's family (air travel shall be via coach class) for up to a 6-month period from the Date of Employment. 

3.     Business Expenses.  

        The
Company shall pay or reimburse all reasonable travel and entertainment expenses incurred by the Executive in connection with the performance of his duties under this Agreement,
including travel between Executive's current domicile in the Philadelphia, Pennsylvania metropolitan area, travel to the Company's various offices and facilities in the United States and abroad,
reimbursement for attending out-of-town meetings of the Board of Directors, and such other travel as may be required or
appropriate in Executive's discretion, consistent with duly approved Company budgets, to fulfill the responsibilities of his office, all in accordance with such policies and procedures as the Company
may from time to time establish for senior officers and as required to preserve any deductions for federal income taxation purposes to which the Company may be entitled and subject to the Company's
normal requirements with respect to reporting and documentation of such expenses. The Company shall provide the Executive with the use of a suitable lodgings during the times he is in Houston, as well
as with suitable transportation. The Company shall pay to Executive a non-accountable automobile allowance of one thousand dollars ($1,000) per month for all expenses incurred by the Executive for
Executive's automobile (including lease payments, insurance, maintenance, and gasoline). The Company shall also pay or reimburse Executive for all membership fees and dues in appropriate professional
associations and organizations utilized by Executive in the course of his service for the Company, as well as all expenses incurred by the Executive for Executive's cellular telephone including
monthly service charges, equipment maintenance and all other ancillary charges including, but not limited to, text messaging, paging, and wireless communications. 

4.     Termination of Employment.

        Notwithstanding
any other provision of this Agreement, Executive's employment with the Company may be terminated upon written notice to the other party as follows: 

        (a)   By
the Company, in the event of the Executive's death or Disability (as hereinafter defined) or for Cause (as hereinafter defined). For purposes of this Agreement,
"Cause" shall mean either: (i) the indictment of, or the bringing of formal charges against Executive on charges involving criminal fraud or embezzlement; (ii) the conviction of
Executive of a crime involving an act or acts of dishonesty, fraud or moral turpitude by the Executive, which act or acts constitute a felony; (iii) Executive having caused the Company to
violate the Company's Bylaws; (iv) Executive having committed acts or omissions constituting gross negligence or willful misconduct with respect to the Company including with respect to any
valid contract to which the Company is a party; (v) Executive having committed acts or omissions constituting a material breach of Executive's obligations under this Agreement or of Executive's
duty of loyalty or fiduciary duty to the Company or any material act of dishonesty or fraud with respect to the Company which are not cured in a reasonable time, which time shall be 30 days from
receipt of written notice from the Company of such material breach; or (vi) Executive having committed acts or omissions constituting a material breach of this Agreement which are not cured in
a reasonable time, which time shall be 30 days from receipt of written notice from the Company setting forth with specificity the particulars of any such material breach as well as the corrective
actions required. A determination that Cause exists as defined in clauses (iv), (v), or (vi) (as to this Agreement) of the preceding sentence shall be made by at least a majority of the members
of the Board of Directors. For purposes of this Agreement, "Disability" shall mean the inability of Executive, in the reasonable judgment of a physician jointly appointed by the Executive and Board of
Directors, to perform, even with reasonable accommodation, his duties of employment for the Company or any of its subsidiaries because of any physical or mental disability or incapacity, where such
disability 

4

 

shall
exist for an aggregate period of more than 120 days in any 365-day period or for any period of 90 consecutive days. The Company shall by written notice to the Executive specify the event relied
upon for termination pursuant to this Section 4(a), and Executive's employment hereunder shall be deemed terminated as of the date of such notice. In the event of any termination under this
Subsection 4(a), the Company shall pay all amounts then due to the Executive under Section 2(a) of this Agreement for any portion of the payroll period worked but for which payment has
not yet been made up to the date of termination, and, if such termination was for Cause, the Company shall have no further obligations to Executive under this Agreement, and any and all options
granted hereunder shall terminate according to their terms. In the event of a termination due to Executive's Disability or death, the Company shall comply with its obligations under
Sections 2(e) and 2(f). 

        (b)   By
the Company, in the absence of Cause, for any reason and in its sole and absolute discretion, provided that in such event the Company shall, as liquidated damages or
severance pay, or both, continue to pay to Executive the Base Salary (at a monthly rate equal to the rate in effect immediately prior to such termination) for the longer of the remaining term through
December 31, 2007 or twelve months from the date of termination (the "Termination Payments"), when, as and if such payments would have been made in the absence of Executive's termination. The
Termination Payments shall be made regardless of Executive's subsequent re-employment as long as any new employment is not in violation of Sections 5 or 6 of this Agreement. 

        (c)   By
the Executive for "Good Reason," (as the Executive shall reasonably determine in good faith) which shall be deemed to exist: (i) if the Company's Board of Directors
or that of any successor entity of Company, fails to appoint or reappoint the Executive or removes the Executive from the title and/or office of President, or the title and/or office of CEO, of the
Company or from any successor entity
operating the Company; (ii) if Executive is assigned any duties materially inconsistent with the duties or responsibilities of the President and CEO of the Company as contemplated by this
Agreement or any other action by the Company that results in a material diminution in such position, authority, duties, or responsibilities, excluding an isolated, insubstantial, and inadvertent
action not taken in bad faith and which is remedied by the Company promptly after receipt of notice thereof given by Executive (but not excluding changes resulting from a sale of the Company, whether
by merger, tender offer or otherwise) provided that Executive shall act within 30 days of any such diminution in the scope of his duties, responsibilities, authority or position;
(iii) if the Company shall breach or shall have continued to fail to comply with any material provision of this Agreement after a 30-day period to cure (if such failure is curable) following
written notice to the Company of such non-compliance; (iv) if the Board of Directors requires Executive without his express written consent to relocate to Houston, Texas, or to any other area
outside a thirty (30) mile radius of Radnor Township, Pennsylvania, (v) upon a change in control of the Company, or within twelve (12) months of any such change in control (for these purposes
the term "change in control" shall have the meaning set forth in Rule 405 of the Securities Act of 1933) or within twelve (12) months of a sale of substantially all of the assets of the Company
or the merger out of existence of the Company. In the event of any termination for "Good Reason" under this Section 4(c), the Company shall, as liquidated damages or severance pay, or both, pay
the Termination Payments, as defined in (b) of this Section 4, to Executive, when, as and if such payments would have been made in the absence of Executive's termination. 

        (d)   During
any period in which Executive is obligated not to compete with the Company pursuant to Section 5 hereof (unless Executive was terminated for Cause as
defined herein), Executive and his family shall continue to be covered by the Company's life, medical, health and death plans. Such coverage shall be at the Company's life, medical, health and death
plans. Such coverage shall be at the Company's expense to the same extent as if Executive were still employed 

5

 

by
the Company. In the event of a termination pursuant to Sections 4(b) or 4(c), the Company shall provide to Executive the pro-rata share of his annual bonus, to the extent one is awarded by
the Compensation Committee the consideration of which shall be taken in good faith, giving a full month's credit for any partial month worked in that bonus year. Additionally, in the event of a
termination pursuant to Sections 4(b) or 4(c), the Company shall provide to Executive, at the Company's expense, outplacement services of a nature customarily provided to a senior executive.
Notwithstanding the foregoing, the obligations of the Company pursuant to this Section 4(d) shall remain in effect no longer than the term of the Termination Payments. 

5.     Non-Competition.  

        During
the period of Executive's employment hereunder and during the period, if any, during which payments are required to be made to the Executive by the Company pursuant to
Sections 4(b) or 4(c), the Executive shall not, within any state or foreign jurisdiction in which the Company or any subsidiary
of the Company is then providing services or products or marketing its services or products (or engaged in active discussions to provide such services), or within a fifty (50) mile radius of any such
state, directly or indirectly own any interest in, manage, control, participate in, consult with, render services for, or in any manner engage in any business engaged in by the Company (unless the
Board of Directors shall have authorized such activity and the Company shall have consented thereto in writing). The term "business engaged in by the Company" shall mean the development and
commercialization of autologous fibroblast system technology for application in, among other therapies, dermatology, surgical and post-traumatic scarring, skin ulcers, cosmetic surgery, periodontal
disease, reconstructive dentistry, vocal chord injuries, urinary incontinence, and digestive and gastroenterological disorders and other applications relating to the market for autologous fibroblast
or UMC cells and the five derivative cell lines: osteoblast, chondroblast, fibroblast, adipocyte, and neutroectoderm. Investments in less than five percent of the outstanding securities of any class
of a corporation subject to the reporting requirements of Section 13 or Section 15(d) of the Securities Exchange Act of 1934, as amended, shall not be prohibited by this
Section 5. At the option of Executive, Executive's obligations under this Section 5 arising after the termination of Executive shall be suspended during any period in which the Company
fails to pay to him Termination Payments required to be paid to him pursuant to this Agreement. The provisions of this Section 5 are subject to the provisions of Section 14 of this
Agreement. 

6.     Inventions and Confidential Information.  

        The
parties hereto recognize that a major need of the Company is to preserve its specialized knowledge, trade secrets, and confidential information. The strength and good will of the
Company is derived from the specialized knowledge, trade secrets, and confidential information generated from experience with the activities undertaken by the Company and its subsidiaries. The
disclosure of this information and knowledge to competitors would be beneficial to them and detrimental to the Company, as would the disclosure of information about the marketing practices, pricing
practices, costs, profit margins, design specifications, analytical techniques, and similar items of the Company and its subsidiaries. The Executive acknowledges that the proprietary information,
observations and data obtained by him while employed by the Company concerning the business or affairs of the Company are the property of the Company. By reason of his being a senior executive of the
Company, the Executive has or will have access to, and has obtained or will obtain, specialized knowledge, trade secrets and confidential information about the Company's operations and the operations
of its subsidiaries, which operations extend throughout the United States. For purposes of this Section 6, "Company" shall mean the Company and each of its controlled subsidiaries. Therefore,
subject to the 

6

 

provisions
of Section 14 hereof, the Executive hereby agrees as follows, recognizing that the Company is relying on these agreements in entering into this Agreement: 

          (i)  During
the period of Executive's employment with the Company and thereafter, the Executive will not use, disclose to others, or publish or otherwise make available to
any other party any inventions or any confidential business information about the affairs of the Company, including but not limited to confidential information concerning the Company's products.
"Confidential Information" shall include commercial or trade secrets about Company's products, methods, engineering designs and standards, analytical techniques, technical information, customer
information, employee information, or financial and business records, any of which contains proprietary information created or acquired by the Company and which information is held in confidence by
Company. Confidential Information does not include information which: (i) becomes generally available to the public, unless said Confidential Information was disclosed in violation of a
confidentiality agreement; or (ii) becomes available to Executive on a non-confidential basis from a source other than the Company or its agents, provided that such source is not bound by a
confidentiality agreement with the Company. 

         (ii)  During
the period of Executive's employment with the Company and for twelve (12) months thereafter, (a) the Executive will not directly or indirectly through
another entity induce any employee of the Company to leave the Company's employ (unless the Board of Directors shall have authorized such employment and the Company shall have consented thereto in
writing) or in any way interfere with the relationship between the Company and any employee thereof or (b) tortiously interfere with the Company's business relationship with any customer,
supplier, licensee, licensor or other business relation of the Company. 

7.     Indemnification.  

        The Company will indemnify (and advance the costs of defense of) and hold harmless the Executive (and his legal representatives) to the fullest extent permitted
by the laws of the state in which the Company is incorporated, as in effect at the time of the subject act or omission, or by the Certificate of Incorporation and Bylaws of the Company, as in effect
at such time or on the date of the Agreement, whichever affords greater protection to the Executive, and the Executive shall be entitled to the protection of any insurance policies the Company may
elect to maintain generally for the benefit of its executive officers, against all judgments, damages, liabilities, costs, charges and expenses whatsoever incurred or sustained by him or his legal
representative in connection with any action, suit or proceeding to which he (or his legal representatives or other successors) may be made a party by reason of his being or having been an officer of
the Company or any of its subsidiaries except that the Company shall have no obligation to indemnify Executive for liabilities resulting from conduct of the Executive with respect to which a court of
competent jurisdiction has made a final determination that Executive committed gross negligence or willful misconduct. 

8.     Litigation Expenses.  

        In the event of any litigation or other proceeding between the Company and the Executive with respect to the subject matter of this Agreement and the enforcement
of the rights hereunder and such litigation or proceeding results in final judgment or order in favor of the Executive, the Company shall reimburse the Executive for all of his reasonable costs and
expenses relating to such litigation or other proceeding, including, without limitation, his reasonable attorney's fees and expenses. 

7

 

9.     Consolidation; Merger; Sale of Assets; Change of Control.  

        Nothing in this Agreement shall preclude the Company from combining, consolidating or merging with or into, transferring all or substantially all of its assets
to, or entering into a partnership or joint venture with, another corporation or other entity, or effecting any other kind of corporate combination provided that the corporation resulting from or
surviving such combination, consolidation or merger, or to which such assets are transferred, or such partnership or joint venture assumes this Agreement and all obligations and undertakings of the
Company hereunder. Upon such a consolidation, merger, transfer of assets or formation of such partnership or joint venture, this Agreement shall inure to the benefit of, be assumed by, and be binding
upon such resulting or surviving transferee corporation or such partnership or joint venture, and the term "Company," as used in this Agreement, shall mean such corporation, partnership or joint
venture or other entity, and this Agreement shall continue in full force and effect and shall entitle the Executive and his heirs, beneficiaries and representatives to exactly the same compensation,
benefits, perquisites, payments and other rights as would have been their entitlement had such combination, consolidation, merger, transfer of assets or formation of such partnership or joint venture
not occurred. 

10.   Survival of Obligations.  

        Sections 4, 5, 6, 7, 8, 9, 11, 12 and 14 shall survive the termination for any reason of this Agreement (whether such termination is by the Company, by the
Executive, upon the expiration of this Agreement or otherwise). 

11.   Executive's Representations.  

        The Executive hereby represents and warrants to the Company that to the best of his knowledge: (i) the execution, delivery and performance of this
Agreement by the Executive do not and shall not conflict with, breach, violate or cause a default under any contract, agreement, instrument, order, judgment or
decree to which the Executive is a party or by which he is bound, (ii) the Executive is not a party to or bound by any employment agreement, non-compete agreement or confidentiality agreement
with any other person or entity and (iii) upon the execution and delivery of this Agreement by the Company, this Agreement shall be the valid and binding obligation of the Executive,
enforceable in accordance with its terms. The Executive hereby acknowledges and represents that he has consulted with legal counsel regarding his rights and obligations under this Agreement and that
he fully understands the terms and conditions contained herein. 

12.   Company's Representations.  

        The Company hereby represents and warrants to the Executive that (i) the execution, delivery and performance of this Agreement by the Company do not and
shall not conflict with, breach, violate or cause a default under any contract, agreement, instrument, order, judgment or decree to which the Company is a party or by which it is bound;
(ii) upon the execution and delivery of this Agreement by the Executive, this Agreement shall be the valid and binding obligation of the Company, enforceable in accordance with its terms; and
(iii) the Company's representations made by the Board of Directors and members of senior management prior to the execution of this Agreement regarding the science, business or fiscal propriety
of the Company are accurate in all material respects. 

13.   Enforcement.  

        Because the Executive's services are unique and because the Executive has access to confidential information concerning the Company, the parties hereto agree that
money damages would not be an adequate remedy for any breach of this Agreement. Therefore, in the event of a breach of this Agreement, the Company may, in addition to other rights and remedies
existing in its favor, apply to 

8

 

any
court of competent jurisdiction for specific performance and/or injunctive or other relief in order to enforce, or prevent any violations of, the provisions hereof (without posting a bond or other
security). 

14.   Severability.  

        In
case any one or more of the provisions or part of a provision contained in this Agreement shall for any reason be held to be invalid, illegal or unenforceable in any respect in any
jurisdiction, such invalidity, illegality or unenforceability shall be deemed not to affect any other jurisdiction or any other provision or part of a provision of this Agreement, nor shall such
invalidity, illegality or unenforceability affect the validity, legality or enforceability of this Agreement or any provision or provisions hereof in any other jurisdiction; and this Agreement shall
be reformed and construed in such jurisdiction as if such provision or part of a provision held to be invalid or illegal or unenforceable had never been contained herein and such provision or part
reformed so that it would be valid, legal and enforceable in such jurisdiction to the maximum extent possible. In furthermore, and not in limitation of the foregoing, the Company and the Executive
each intend that the covenants contained in Sections 5 and 6 shall be deemed to be a series of separate covenants, one for each and every state of the United States and any foreign country set
forth therein. If, in any judicial proceeding, a court shall refuse to enforce any of such separate covenants, then such unenforceable covenants shall be deemed eliminated from the provisions hereof
for the purpose of such proceedings to the extent necessary to permit the remaining separate covenants to be enforced in such proceedings. If, in any judicial proceeding, a court shall refuse to
enforce any one or more of such separate covenants because the total time, scope or area thereof is deemed to be excessive or unreasonable, then it is the intent of the parties hereto that such
covenants, which would otherwise be unenforceable due to such excessive or unreasonable period of time, scope or area, be enforced for such lesser period of time, scope or area as shall be deemed
reasonable and not excessive by such court. 

15.   Entire Agreement; Amendment.  

        Except
as otherwise set forth in this Agreement, this Agreement contains the entire agreement between the Company and the Executive with respect to the subject matter hereof and thereof.
This Agreement may not be amended, waived, changed, modified or discharged except by an instrument in writing executed by or on behalf of the party against whom enforcement of any amendment, waiver,
change, modification or discharge is sought. No course of conduct or dealing shall be construed to modify, amend or otherwise affect any of the provisions hereof. 

16.   Notices.  

        All
notices, requests, demands and other communications hereunder shall be in writing and shall be deemed to have been duly given if physically delivered, delivered by express mail or
other expedited 

9

 

service
or upon receipt if mailed, postage prepaid, via registered mail, return receipt requested, addressed as follows: 

	(a)	 	To the Company:	 	(b)	 	To the Executive:
	

 	
 	

Isolagen Technologies, Inc.,

700 Gemini

Suite 100

Houston, TX 77058	
 	

 	
 	

Robert Bitterman

783 Woodlea Road

Rosemont, PA 19010
	

 	
 	

and to:	
 	

 	
 	

Copy to:
	

 	
 	

Dilworth Paxson, LLP

3200 Mellon Bank Center

1735 Market Street

Philadelphia, PA 19103-7595

Attn: Susan Stranahan Ciallella, Esquire	
 	

 	
 	

Robin Bond, Esq.

88 Militia Hill Drive

Wayne, PA 19087

and/or
to such other persons and addresses as any party shall have specified in writing to the other. 

17.   Assignability. 

        This
Agreement shall not be assignable by either party and shall be binding upon, and shall inure to the benefit of, the heirs, executors, administrators, legal representatives,
successors and assigns of the parties. In the event that all or substantially all of the business of the Company is sold or transferred, then this Agreement shall be binding on the transferee of the
business of the Company whether or not the Agreement is expressly assigned to the transferee. 

18.   Governing Law. 

        The
Agreement shall be governed by and construed under the laws of the Commonwealth of Pennsylvania. 

19.   Waiver and Further Agreement.  

        Any
waiver of any breach of any terms or conditions of this Agreement shall not operate as a waiver of any other breach of such terms or conditions or any other term or condition, nor
shall any failure to enforce any provision hereof operate as a waiver of such provision or of any other provision hereof. Each of the parties hereto agrees to execute all such further instruments and
documents and to take all such further action as the other party may reasonably require in order to effectuate the terms and purposes of this Agreement. 

20.   Headings of No Effect.  

        The
paragraph headings contained in this Agreement are for reference purposes only and shall not in any way effect the meaning or interpretation of this Agreement. 

10

 

        IN
WITNESS WHEREOF, the parties hereto have executed this Employment Agreement as of the date first above written. 

	 	 	COMPANY:
	

 	
 	

ISOLAGEN, INC.
	

    	
 	

 	

 	

 
	 	 	By:	/s/  STEVE MORRELL      
 Steve Morrell

Director	/s/  HENRY TOH      
 Henry Toh

Director
	

    	
 	

 	

 	

 
	 	 	EXECUTIVE:	 
	

    	
 	

 	

 	

 
	 	 	/s/  ROBERT BITTERMAN      
 Robert Bitterman

11

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EMPLOYMENT AGREEMENT

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