Document:

Exhibit 10.1

CONTACTS
--------
Robin Smith
CEO
Tel: (631) 574-4955
Fax: (631) 574-4956
E-mail: rsmith@neostem.com

                              FOR IMMEDIATE RELEASE

                    PHASE III MEDICAL ANNOUNCES COMPLETION OF

                           NEW FINANCING OF $2 MILLION

                                      - - -

 Funds to Expand Operations of NeoStem--A Newly Acquired Adult Stem Cell Company

MELVILLE, N.Y., June 12, 2006 - Phase III Medical, Inc. ("Phase III") (OTCBB:
PHSM), today announced that it has completed a financing in the amount of
$2,079,000. The money was raised to further develop the IP and market its new
business, NeoStem, Inc. ("NeoStem"), an adult stem cell collection, processing
and storage business which earlier in the year was acquired by Phase III
Medical, Inc.

On June 2, 2006, Phase III Medical, Inc. (the "Company") entered into a
Securities Purchase Agreement with 17 accredited investors. Pursuant to the
Securities Purchase Agreement, the Company issued to each Investor shares of its
common stock, par value $.001 per share (the "Common Stock"), at a per share
price of $0.044, along with a five-year warrant to purchase a number of shares
of Common Stock equal to 50% of the number of shares of Common Stock purchased
by the Investor. The gross proceeds from the sale were $2,079,000 with the
principal investors being Duncan Capital Partners LLC and Meyer Ventures LLC.

Robin Smith, Chairman and CEO of Phase III Medical, Inc., said, "With this
financing, NeoStem will be positioned for the growth needed to enable adults to
store their stem cells for the future so they are available for diagnostic and
therapeutic uses that are being developed for the treatment of diabetes, heart
disease, and other critical health problems.

Michael Crow, President of DC Associates LLC, whose fund was the principal
investor, said, "With the additional funds, Phase III will be equipped to expand
NeoStem and build upon its IP to be first movers in adult stem cell storage for
future therapeutic treatments."

On June 2, 2006, the Company issued an aggregate of 47,249,992 shares of Common
Stock to Investors pursuant to the Securities Purchase Agreement and also issued
to each Investor, in addition to the shares of Common Stock, five-year warrants
to purchase up to an aggregate of 23,624,991 shares of Common shares of Common
Stock, at an exercise price of $0.08 per share. In addition, the Company issued
an aggregate of 3,799,821 shares to certain officers of the Company for
conversion of an aggregate of $278,653.55 of accrued salary (less adjustments
for applicable payroll and withholding taxes), pursuant to the terms of the
Securities Purchase Agreement. The securities were not registered under the
Securities Act of 1933.

About Phase III Medical, Inc.
Phase III Medical, Inc. (OTCBB: PHSM), a Delaware corporation, is an innovative,
publicly traded company that, through the acquisition of NeoStem, is positioned
to become a leader in the adult stem cell field and to capitalize on the
increasing importance the Company believes adult stem cells will play in the
future of regenerative medicine. The management and Board of Directors and
Advisors of Phase III collectively have substantial experience in life science
marketing, business management, and financial expertise, as well as significant
technical, medical and scientific experience.

                                     ######

Certain statements in this press release constitute "forward-looking statements"
within the meaning of the Private Securities Litigation Reform Act of 1995,
including statements concerning the Company's ability to develop the adult stem
cell business, the future of regenerative medicine and the role of adult stem
cells in that future, the future use of adult stem cells as a treatment option
and the potential revenue growth of NeoStem's business. Such forward-looking
statements involve known and unknown risks, uncertainties and other factors,
which may cause the actual results, performance or achievements of Phase III
Medical, Inc. ("the Company"), or industry results, to be materially different
from any future results, performance, or achievements expressed or implied by
such forward-looking statements. The Company' s ability to enter the adult stem
cell arena and future operating results are dependent upon many factors,
including but not limited to (i) the Company's ability to obtain sufficient
capital or a strategic business arrangement to fund its expansion plans; (ii)
the Company's ability to build the management and human resources and
infrastructure necessary to support the growth of its business; (iii)
competitive factors and developments beyond the Company's control;(iv)
scientific and medical developments beyond the Company's control and (v) other
risk factors discussed in the Company's periodic filings with the Securities and
Exchange Commission which are available for review at www.sec.gov under "Search
for Company Filings."[FIRST CONSULTING GROUP, INC. LOGO]

June 2, 2006                      Exhibit 10.2

Larry R. Ferguson
6800 Medinah Court
Charlotte, N.C.  28210

Dear Larry:

We are very  pleased to confirm in writing  the offer of  employment  with First
Consulting Group, Inc. (FCG) to serve as our Chief Executive Officer (CEO). Upon
your  employment,  you will also be appointed to FCG's Board of  Directors.  The
terms of this offer  shall be remain  outstanding  until  June 15,  2006 and the
terms of the offer are as follows:

     o    Your anticipated start date will be June 26, 2006

     o    Your title will be Chief Executive  Officer (CEO).  You will report to
          FCG's Board of Directors,  and you will also be a member of the Board.
          You agree that your full time and  attention on business  matters will
          be devoted to FCG,  and that you will not serve on any other boards of
          directors  (other  than  incidental   not-for-profit   boards  or  the
          following  current boards of directors on which you serve:  Chamberlin
          Edmonds  &  Associates  and  Atstaff  without  the prior  consent  and
          approval of the FCG Board.  Any business travel shall be in accordance
          with  FCG's  standard  travel  policies   applicable  to  all  of  its
          associates.

     o    FCG is an "at will"  employer,  meaning that you or FCG can  terminate
          the employment relationship at any time, with or without prior notice,
          and for any reason not prohibited by statute. You agree that if you or
          FCG terminates your employment at any time, you shall also immediately
          resign from the Board of Directors. All employment is continued on the
          foregoing basis,  subject to the terms of employment set forth in this
          letter.

     o    Your total compensation package shall be as follows:

          >>   Your  semi-monthly  salary  will  be  $19,292  which  equates  to
               $463,000 per year.

          >>   You will be  eligible  for the  Management/Vice  President  Bonus
               Plan, which plan provides for quarterly  measurement  periods and
               is currently  reviewed and approved  annually by the Compensation
               Committee of the Board. Your actual participation will start with
               the  quarter  in  which  you meet  the  eligibility  requirements
               (January  1, April 1, July 1 or October  1). If your first day of
               employment  changes from the date described  above, the effective
               date of your bonus plan  eligibility  may be affected.  The bonus
               payout will be prorated for the first quarter of your  employment
               as long as you are employed by the 16th day of the quarter.  Your
               bonus  target will be 75% of your  annual base salary  (pro-rated
               for time in  position).The  bonus target will be divided into two
               components: (i) 50% will be based on the Firmwide Management/Vice
               President plan; and (ii) 25% based on personal MBO's  established
               by the Board of Directors  for you. The Firmwide  Management/Vice
               President  plan  currently is divided into two components (i) 90%
               of target bonus is payable only upon  achievement  by the firm of
               quarterly  operating  income targets approved by the Board and is
               then funded by any operating income overachievement dollars (2 of
               every 3  overachievement  dollars  fund this portion of the bonus
               pool);  and  (ii) 10% is based  upon  achievement  by the firm of
               quarterly  DSO targets.  Your  specific  goals for your  personal
               MBO's  will  be  set  by  the  FCG  Board  of  Directors,  or its
               Compensation Committee, as soon as practicable after you commence

<PAGE>

Larry R. Ferguson
June 2, 2006
Page 2

               employment  with FCG, and you and the Board will make all efforts
               to set  the  performance  goals  within  30 to 60  days  of  your
               commencement of employment with FCG. In the event that you do not
               achieve  a bonus  of  $50,000  in each of the  third  and  fourth
               quarters of 2006,  FCG will pay you additional  compensation  for
               such quarters so that you will receive a guaranteed minimum bonus
               of $50,000 in each such quarters  (i.e.,  if bonus earned through
               the  plans is  $25,000  in Q3,  FCG  will  pay you an  additional
               $25,000 at the time bonus payments for Q3 are made). This minimum
               bonus  guarantee  shall  not  apply  to  the  extent  you  or FCG
               terminate  your  employment  prior to the date of  payment of the
               applicable installment of the minimum amount.

          >>   Effective  with your first day of  employment,  the  Compensation
               Committee of the Board will approve and grant to you an option to
               purchase  500,000 shares of FCG common stock.  The exercise price
               of the option  will be the  closing  price of FCG's  stock on the
               Nasdaq  National  Market on the last trading day  preceding  your
               first day of employment. The options will vest over four years as
               follows:  25% shall be exercisable upon the first  anniversary of
               your  employment  with FCG and the remaining 75% shall vest in 36
               equal monthly  installments  over last three years of the vesting
               period. The options will have a ten (10) year term and be subject
               to the terms of FCG's 1997 Equity Incentive Plan, a copy of which
               is  included  with this  offer  letter.  The 1997  Plan  includes
               "double  trigger"  protections  allowing for  acceleration of the
               vesting of your options under certain customary  circumstances if
               your  employment is  terminated  (as defined in the 1997 Plan) in
               the event of a change in control of FCG.  You will  receive  your
               stock option  agreement and grant  documentation  within  fifteen
               (15) days of your first day of employment with FCG.

          >>   You will be party to a change in control  agreement that provides
               certain  compensation  and  benefits  to you in  the  event  your
               employment is  terminated in connection  with a change in control
               of  FCG.  Generally,  it  provides  for  payment  of 200% of your
               then-current base salary,  24 months of COBRA payments,  standard
               FCG executive outplacement  assistance and a pro-rated portion of
               your current  period bonus.  The trigger for payment of severance
               is similar to the "double  trigger"  set forth in the 1997 Equity
               Incentive  Plan.  A copy of the  agreement  is enclosed  for your
               review and execution concurrent with this letter.

          >>   You will be party to FCG's  standard  employee  agreement,  which
               provides   for   normal   and   customary   confidentiality   and
               non-solicitation  of clients and employees.  In addition to FCG's
               standard terms, your employee agreement also contains  provisions
               that allow for payment of lump sum cash  severance  to you in the
               amount of 100% of your  then-current base salary in the event FCG
               terminates your employment, other than for "cause" (as defined in
               the employee agreement).

          >>   You  will be  party to  FCG's  standard  officer  indemnification
               agreement  under which FCG provides  contractual  indemnification
               allowed by Delaware law for certain directors and officers of the
               Company.  A copy of the agreement is enclosed for your review and
               execution concurrent with this letter.

          >>   You  will be  eligible  to  participate  in the FCG  Supplemental
               Executive Retirement Plan ("SERP") under the terms and conditions
               thereof  as in effect  from time to time.  You can elect to defer
               your own pay on a pre-tax  basis to your SERP  account (up to 50%
               of base  salary  and  100%  of  bonus).  In  addition,  FCG  will
               contribute  $10,000 to your SERP  account in 2006  (normally  the
               contribution  occurs in the fourth  quarter  of the year).  FCG's
               contributions   have  a  five-year   vesting   period,   but  the
               contributions  you make are  immediately  vested,  subject to the
               terms of the SERP.

          >>   You will be provided  the option of temporary  furnished  housing
               accommodations  up to  $3,000/month  in  order  to  make  it more
               convenient  for you to spend time in the  corporate  offices when
               you are not  otherwise  traveling on  business.  Please note that
               this housing allowance is taxable to you.

<PAGE>

Larry R. Ferguson
June 2, 2006
Page 3

          >>   You will be eligible to  participate in the FCG 401(k) plan under
               the terms and conditions  thereof as in effect from time to time.
               Once eligible, you can contribute up to 50% of your annual salary
               to the 401(k)  plan,  up to the  maximum set by the IRS each year
               ($15,000  in 2006).  FCG will  match 50% of the first  $10,000 of
               your own contribution  (This means a matching  contribution of up
               to $5,000  per  year).  You can  elect to  receive  the  matching
               contribution in cash or FCG stock.

          >>   You  will  be  eligible  for  FCG's  benefits  program  for  Vice
               Presidents,  which  program is outlined  briefly in the  enclosed
               document titled, "Discretionary Benefits for Vice Presidents."

          >>   Except as set forth in this letter or the  agreements  referenced
               herein above,  you will be subject to all standard FCG's policies
               as set forth in the FCG  Associate  Handbook,  a copy of which is
               provided for your information with this letter.

Please understand that it is not FCG's desire or intent to induce you to violate
any agreement that you may have with your current or any former  employer.  This
offer is  contingent  on FCG receiving  assurance  that your  acceptance of this
offer  and  commencement  of work  with FCG will not  violate  the  terms of any
agreement that you may have with your current or any former employer. This offer
is also  contingent  upon the  favorable  completion  of  referencing  which may
include:  current  employer,  the verification of  degrees/licenses,  a criminal
background  investigation,  etc. Our independent  auditors,  Grant Thornton LLP,
will also  conduct a  standard  background  check  that it  conducts  on all new
executive or financial officers for its public company clients.

The terms of this offer  letter,  along  with the  change in control  agreement,
employee  agreement,  and  indemnification  agreement  referenced  above,  shall
constitute the terms of your employment with FCG.

If the terms of  employment  set forth in this  letter  are  acceptable  to you,
please execute all documents and fax back to Jan Blue at (562) 437-1895.  Please
also send the originals to Jan's  attention in FCG Human Resources (an addressed
envelope is included).  I can be reached at (714) 520-6367  and will be happy to
assist you if you have any questions about this offer or our benefits package.

After we have received your signed copy of this letter indicating  acceptance of
this offer, you will be sent an information  packet which includes documents you
will need to bring  with you on your first day of  employment.  You will need to
provide a copy of your Social  Security  card for payroll  purposes,  as well as
original documentation  verifying your employment eligibility per federal law. A
list of acceptable  documents  will be provided in the  information  packet.  In
addition,  please  bring a voided,  blank  check if you would  like to  initiate
direct deposit of your payroll and/or expense checks.

Larry,  we think you will find FCG a challenging  and rewarding  company to lead
and we look forward to your favorable response to our offer.

Yours very truly,

FIRST CONSULTING GROUP, INC.                 I hereby accept this offer of
                                             employment in accordance with the
                                             terms stated above.
                                             My expected start date is See above
                                                                       ---------

/s/ Robert Funari                             /s/ Larry R. Ferguson
-----------------------------------          -----------------------------------
Robert Funari                                Signature
Chair of the Compensation Committee
of the Board of Directors

                                             -----------------------------------
                                             Please print your name as you would
                                             like it to appear on your business
                                             cards.
Enclosures

cc:  Douglas G. Bergeron
     Cora Tellez
     HR File

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