PLEDGE
      AGREEMENT

     

    THIS
      PLEDGE AGREEMENT (the “Pledge Agreement”) is made and dated this 8th
      day of
      September, 2006 by and between Patient Safety Technologies, Inc., a Delaware
      corporation (“Debtor”), and Steven J. Caspi, an individual (“Secured
      Party”).

     

    RECITALS

     

    A. Secured
      Party has agreed to extend credit to Debtor on the terms and subject to the
      conditions set forth in that certain Secured Convertible Promissory Note dated
      as of even date herewith (as the same may be amended, extended or replaced
      from
      time to time, the “Note”). The Note is being issued pursuant to that certain
      Note and Warrant Purchase Agreement dated as of even date herewith (as the
      same
      may be amended, extended or replaced from time to time, the “Purchase
      Agreement”). Capitalized terms used herein without definition have the meanings
      assigned thereto in the Purchase Agreement.

     

    B. To
      induce
      Secured Party to extend such credit, Debtor has agreed to pledge and to grant
      to
      Secured Party a security interest in and lien upon certain property of Debtor
      described more particularly herein.

     

    NOW,
      THEREFORE, in consideration of the above Recitals and for other good and
      valuable consideration, the receipt and adequacy of which are hereby
      acknowledged, the parties hereto hereby agree as follows:

     

    AGREEMENT

     

    1. Pledge.

     

    Debtor
      hereby pledges, assigns and grants to Secured Party a security interest in
      the
      property described in Section 2 below (collectively and severally, the
“Collateral”) to secure payment and performance of the Obligations (as defined
      below).

     

    2. Collateral.

     

    The
      Collateral consists of all right, title and interest of Debtor in and to the
      following, whether now existing or hereafter acquired: (a) all equity interests
      listed on Schedule 1 to this Pledge Agreement and all other equity interests
      obtained by Debtor and the certificates representing all such equity interests
      (the “Pledged Interests”) and all security accounts, deposit accounts, and
      commodity accounts in which such equity interests are held; (b) all other
      property that may be delivered to and held by Secured Party pursuant to the
      terms of this Pledge Agreement; (c) all payments of dividends, cash, securities,
      instruments and other property from time to time received, receivable or
      otherwise distributed, in respect of, in exchange for or upon the conversion
      of
      the securities referred to in subparagraph
      (a)
      above;
      (d) all rights, powers and privileges of Debtor with respect to the Collateral
      referred to above; and (e) all proceeds of the foregoing Collateral.


     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    Upon
      delivery to Secured Party (a) any stock certificates, promissory notes or other
      securities now or hereafter included in the Collateral (the “Pledged
      Securities”) shall be accompanied by stock powers duly executed in blank or
      other instruments of transfer satisfactory to Secured Party and by such other
      endorsement, instruments and documents as Secured Party may reasonably request
      and (b) all other property comprising part of the Collateral shall be
      accompanied by proper instruments of assignment duly executed by Debtor and
      such
      other endorsements, instruments or documents as Secured Party may reasonably
      request. Debtor promises promptly to deliver to Secured Party any and all
      Pledged Securities and any and all certificates or other instruments or
      documents representing the Collateral. Each delivery of Pledged Securities
      shall
      be accompanied by a schedule describing the securities theretofore and then
      being pledged hereunder, which schedule shall be attached hereto as Schedule
      I
      and made a part hereof. Each schedule so delivered shall supersede any prior
      schedules so delivered.

     

    3. Obligations.

     

    The
      Obligations secured by this Pledge Agreement consists of any and all debts,
      obligations, and liabilities of Debtor to Secured Party arising out of or
      related to the Note, the Purchase Agreement and this Pledge Agreement (whether
      principal, interest, fees or otherwise, whether now existing or hereafter
      arising, whether voluntary or involuntary, whether or not jointly owed with
      others, whether direct or indirect, absolute or contingent, contractual or
      tortious, liquidated or unliquidated, arising by operation of law or otherwise,
      whether or not from time to time decreased or extinguished and later increased,
      created or incurred and whether or not extended, modified, rearranged,
      restructured, refinanced, or replaced, including without limitation,
      modifications to interest rates or other payment terms of such debts,
      obligations, or liabilities).

     

    4. Representations
      and Warranties. 

     

    In
      addition to all representations and warranties of Debtor set forth in the Note
      and the Purchase Agreement which are incorporated herein by this reference,
      Debtor hereby represents and warrants that: (a) the Pledged Interests represent
      that percentage set forth on Schedule I of the issued and outstanding equity
      interests of the issuer with respect thereto, based on the most recent filings
      by the respective issuer if such issuer is a publicly reporting company, and
      in
      all other cases based on the corporate records of such issuer, in each case
      as
      of the date of this Agreement; (b) except for the security interest granted
      hereunder, Debtor (i) is and will at all times continue to be the direct owner,
      beneficially and of record, of the Pledged Securities indicated on Schedule
      I,
      (ii) holds the same free and clear of all liens except the lien in favor of
      Secured Party, (iii) will not dispose of or make any assignment, pledge,
      hypothecation or transfer of, or create or permit to exist any security interest
      in or other lien on, the Collateral, other than pursuant hereto, and (iv) will
      cause any and all Collateral, whether for value paid by Debtor or otherwise,
      to
      be forthwith pledged or assigned hereunder and deposited with Secured Party
      pursuant hereto, and; (c) Debtor (i) has the power and authority to pledge
      the
      Collateral in the manner hereby done or contemplated, and (ii) will defend
      its
      title or interest thereto or therein against any and all liens (other than
      the
      liens created by this Pledge Agreement), however arising, of all persons
      whomsoever; (d) no consent of any other person (including stockholders or
      creditors of Debtor and stockholders or creditors of any issuer of Pledged
      Securities) and no consent or approval of any governmental authority or any
      securities exchange was or is necessary to the validity or enforceability of
      the
      pledge effected hereby, except such consents as have been obtained and are
      in
      full force and effect; (e) by virtue of the execution and delivery by Debtor
      of
      this 

     

    
      
         

      

      
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    Pledge
      Agreement, when the Pledged Securities, certificates or other documents
      representing or evidencing the Collateral are delivered to Secured Party in
      accordance with this Pledge Agreement or, if a security interest in the
      Collateral may not under applicable law be perfected by possession, then upon
      the filing of appropriate financing statements, Secured Party will obtain a
      valid and perfected first lien upon and security interest in such Pledged
      Securities as security for the payment and performance of the Obligations;
      (f)
      all of the pledged equity interests have been duly authorized and validly issued
      and are fully paid and nonassessable and are in certificated form; provided
      that
      the representation and warranty set forth in this clause (f) is to the best
      knowledge of Debtor with respect to equity interests in any issuer that is
      not a
      subsidiary of Debtor; provided, further, however, that in the event that any
      such pledged equity interests do not comply with the representation and warranty
      set forth in this clause (f), Debtor shall be required to take all necessary
      action to cause such pledged equity interests to satisfy the representation
      and
      warranty set forth in this clause (f) within 30 days after obtaining knowledge
      of same; (g) the Collateral will not be represented by any certificates, notes,
      securities, documents, or other instruments other than those delivered
      hereunder; and (h) the terms of the governing documentation for the persons
      whose equity interests are pledged under this Pledge Agreement will at all
      times
      expressly provide that the equity interests are securities governed by Article
      8
      of the Uniform Commercial Code as in effect in the State of California and
      that
      such equity interests will at all times be represented by a certificate or
      certificates duly delivered to Secured Party under this Pledge
      Agreement.

     

    5. Registration
      in Nominee Name; Denominations.

     

    After
      the
      occurrence and during the continuance of an Event of Default, Secured Party
      shall have the right (in its sole and absolute discretion) to hold the Pledged
      Securities in its own name as pledgee, the name of its nominee (as pledgee
      or as
      sub-agent) or the name of Debtor, endorsed or assigned in blank or in favor
      of
      Secured Party. Debtor will promptly give to Secured Party copies of any notices
      or other communication received by it with respect to the Pledged Securities
      registered in the name of Debtor. After the occurrence and during the
      continuance of an Event of Default, Secured Party shall have the right to
      exchange the certificates representing Pledged Securities for certificates
      of
      smaller or larger denominations for any purpose consistent with this Pledge
      Agreement. Debtor hereby grants to Secured Party an exclusive, irrevocable
      power
      of attorney, with full power and authority in the place and stead of Debtor
      to
      take all such action permitted under this Section 5. Debtor agrees to reimburse
      Secured Party upon demand for any costs and expenses, including, without
      limitation, reasonable attorneys’ fees, that Secured Party may incur while
      acting as Debtor’s attorney-in-fact hereunder, all of which costs and expenses
      are included in the Obligations secured hereby. It is further agreed and
      understood between the parties hereto that such care as Secured Party gives
      to
      the safekeeping of its own property of like kind shall constitute reasonable
      care of the Collateral when in Secured Party’s possession; provided, however,
      that Secured Party shall not be required to make any presentment, demand or
      protest, or give any notice and need not take any action to preserve any rights
      against any prior party or any other person in connection with the Obligations
      or with respect to the Collateral.

     

    
      
         

      

      
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    6. Administration
      of the Pledged Securities.

     

    (a) Until
      there shall have occurred and be continuing an Event of Default, Debtor shall
      be
      entitled to vote or consent with respect to the Pledged Securities in any manner
      not inconsistent with this Pledge Agreement or any document or instrument
      delivered or to be delivered pursuant to or in connection herewith and to
      receive all regular dividends paid with respect to the Pledged Securities;
      provided, however, that Debtor will not be entitled to exercise any such right
      if the result thereof could materially and adversely affect the rights inuring
      to a holder of the Pledged Securities or the rights and remedies of Secured
      Party under this Pledge Agreement, the Purchase Agreement or the Note or the
      ability of Secured Party to exercise the same. If there shall have occurred
      and
      be continuing an Event of Default and Secured Party shall have notified Debtor
      that Secured Party desires to exercise its proxy rights with respect to all
      or a
      portion of the Pledged Securities, Debtor hereby grants to Secured Party an
      irrevocable proxy for the Pledged Securities pursuant to which proxy Secured
      Party shall be entitled to vote or consent, in its discretion, and in such
      event
      Debtor agrees to deliver to Secured Party such further evidence of the grant
      of
      such proxy as Secured Party may request. Upon the occurrence and during the
      continuance of an Event of Default, all rights of Debtor to exercise the voting
      and consensual rights and powers it is entitled to exercise pursuant to this
      Pledge Agreement shall cease, and all such rights shall thereupon become vested
      in Secured Party, which shall have the sole and exclusive right and authority
      to
      exercise such voting and consensual rights and powers.

     

    (b) In
      the
      event that at any time or from time to time after the date hereof, Debtor,
      as
      record and beneficial owner of the Pledged Securities, shall receive or shall
      become entitled to receive, any dividend or any other distribution whether
      in
      securities or property by way of stock split, spin-off, split-up or
      reclassification, combination of shares or the like, or in case of any
      reorganization, consolidation or merger, and Debtor, as record and beneficial
      owner of the Pledged Securities, shall thereby be entitled to receive securities
      or property in respect of such Pledged Securities, then and in each such case,
      Debtor shall deliver to Secured Party and Secured Party shall be entitled to
      receive and retain all such securities or property as part of the Pledged
      Securities as security for the payment and performance of the Obligations.
      

     

    (c) Upon
      the
      occurrence and during the continuance of an Event of Default, all rights of
      Debtor to regular dividends and distributions that Debtor is authorized to
      receive pursuant to this Pledge Agreement shall cease, and all such rights
      shall
      thereupon become vested in Secured Party, which shall have the sole and
      exclusive right and authority to receive and retain such dividends and
      distributions. All dividends and distributions received by Debtor contrary
      to
      the provisions of this Pledge Agreement shall be held in trust for the benefit
      of Secured Party, shall be segregated from other property or funds of Debtor
      and
      shall forthwith be delivered to Secured Party upon demand in the same form
      as so
      received (with any necessary endorsement). Any and all money and other property
      paid over to or received by Secured Party pursuant to the provisions of this
      subparagraph (c) shall be retained by Secured Party in an account to be
      established by Secured Party upon receipt of such money or other property and
      shall constitute Collateral under this Pledge Agreement to be applied in
      accordance herewith.

     

    
      
         

      

      
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    (d) Upon
      the
      occurrence and during the continuance of an Event of Default, Secured Party
      is
      authorized to sell the Pledged Securities and, at any such sale of any of the
      Pledged Securities, if it deems it advisable to do so, to restrict the
      prospective bidders or purchasers to persons or entities who (1) will represent
      and agree that they are purchasing for their own account, for investment, and
      not with a view to the distribution or sale of any of the Pledged Securities;
      and (2) satisfy the offeree and purchaser requirements for a valid private
      placement transaction under Section 4(2) of the Securities Act of 1933, as
      amended (the “Act”), and under Securities and Exchange Commission Release Nos.
      33-6383; 34-18524; 35-22407; 39-700; IC-12264; AS-306, or under any similar
      statute, rule or regulation. Debtor agrees that disposition of the Pledged
      Securities pursuant to any private sale made as provided above may be at prices
      and on other terms less favorable than if the Pledged Securities were sold
      at
      public sale, and that Secured Party has no obligation to delay the sale of
      any
      Pledged Securities for public sale under the Act. Debtor agrees that a private
      sale or sales made under the foregoing circumstances shall be deemed to have
      been made in a commercially reasonable manner. In the event that Secured Party
      elects to sell the Pledged Securities, or part of them, and there is a public
      market for the Pledged Securities, in a public sale Debtor shall use its best
      efforts to register and qualify the Pledged Securities, or applicable part
      thereof, under the Act and all state Blue Sky or securities laws required by
      the
      proposed terms of sale and all expenses thereof shall be payable by Debtor,
      including, but not limited to, all costs of (i) registration or qualification
      of, under the Act or any state Blue Sky or securities laws or pursuant to any
      applicable rule or regulation issued pursuant thereto, any Pledged Securities,
      and (ii) sale of such Pledged Securities, including, but not limited to,
      brokers’ or underwriters’ commissions, fees or discounts, accounting and legal
      fees, costs of printing and other expenses of transfer and sale.

     

    (e) If
      any
      consent, approval or authorization of any state, municipal or other governmental
      department, agency or authority should be necessary to effectuate any sale
      or
      other disposition of the Pledged Securities, or any part thereof, Debtor will
      execute such applications and other instruments as may be required in connection
      with securing any such consent, approval or authorization, and will otherwise
      use its best efforts to secure the same.

     

    (f) Nothing
      contained in this Section 6 shall be deemed to limit the other obligations
      of
      Debtor contained in the Purchase Agreement, the Note or this Pledge Agreement
      and the rights of Secured Party hereunder or thereunder.

     

    
      
         

      

      
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    7. Default.

     

    An
      event
      of default (an “Event of Default”) shall be deemed to exist under this Pledge
      Agreement if Debtor shall fail to observe any term or condition of the Note,
      the
      Purchase Agreement or this Pledge Agreement (in each case after any applicable
      cure period expressly provided in such instrument or agreement).

     

    8. Remedies.

     

    (a) Upon
      the
      occurrence of an Event of Default, Secured Party may, without notice to or
      demand on Debtor and in addition to all rights and remedies available to Secured
      Party with respect to the Obligations, at law, in equity or otherwise, do any
      one or more of the following: 

     

    (1) Foreclose
      or otherwise enforce Secured Party’s security interest in any manner permitted
      by law or provided for in this Pledge Agreement;

     

    (2) Sell,
      lease, license or otherwise dispose of any Collateral at one or more public
      or
      private sales at Secured Party’s place of business or any other place or places,
      including, without limitation, any broker’s board or securities exchange,
      whether or not such Collateral is present at the place of sale, for cash or
      credit or future delivery, on such terms and in such manner as Secured Party
      may
      determine;

     

    (3) Recover
      from Debtor all costs and expenses, including, without limitation, reasonable
      attorneys’ fees (including the allocated cost of internal counsel), incurred or
      paid by Secured Party in exercising any right, power or remedy provided by
      this
      Pledge Agreement; and/or

     

    (4) In
      connection with the disposition of any Collateral, disclaim any warranty
      relating to title, possession or quiet enjoyment.

     

    (b) Unless
      the Collateral threatens to decline speedily in value or is of a type
      customarily sold on a recognized market, Debtor shall be given ten (10) days’
prior notice of the time and place of any public sale or of the time after
      which
      any private sale or other intended disposition of Collateral is to be made
      pursuant to this Pledge Agreement, which notice Debtor hereby agrees shall
      be
      deemed reasonable notice thereof. 

     

    (c) Upon
      any
      sale or other disposition pursuant to this Pledge Agreement, Secured Party
      shall
      have the right to deliver, assign and transfer to the purchaser thereof the
      Collateral or portion thereof so sold or disposed of. Each purchaser at any
      such
      sale or other disposition (including Secured Party) shall hold the Collateral
      free from any claim or right of whatever kind, including any equity or right
      of
      redemption of Debtor and Debtor specifically waives (to the extent permitted
      by
      law) all rights of redemption, stay or appraisal which it has or may have under
      any rule of law or statute now existing or hereafter adopted. 

     

    
      
         

      

      
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    (d) Any
      deficiency with respect to the Obligations which exists after the disposition
      or
      liquidation of the Collateral shall be a continuing liability of Debtor to
      Secured Party and shall be immediately paid by Debtor to Secured
      Party.

     

    (e) Notwithstanding
      anything else contained in this Pledge Agreement, if any non-cash proceeds
      are
      received in connection with any sale or disposition of any Collateral, Secured
      Party shall not apply such non-cash proceeds to the Obligations unless and
      until
      such proceeds are converted to cash; provided, however, that if such non-cash
      proceeds are not expected on the date of receipt thereof to be converted to
      cash
      within one year after such date, Secured Party shall use commercially reasonable
      efforts to convert such non-cash proceeds to cash within such one year
      period.

     

    9. Cumulative
      Rights.

     

    The
      rights, powers, and remedies of Secured Party under this Pledge Agreement shall
      be in addition to all rights, powers, and remedies given to Secured Party by
      virtue of any statute or rule of law, the Purchase Agreement, the Note or any
      other agreement, all of which rights, powers, and remedies shall be cumulative
      and may be exercised successively or concurrently without impairing Secured
      Party’s security interest in the Collateral.

     

    10. Waiver.

     

    Any
      waiver, forbearance or failure or delay by Secured Party in exercising any
      right, power, or remedy shall not preclude the further exercise thereof, and
      every right, power, or remedy of Secured Party shall continue in full force
      and
      effect until such right, power or remedy is specifically waived in a writing
      executed by Secured Party. Debtor waives any right to require Secured Party
      to
      proceed against any person or to exhaust any Collateral or to pursue any remedy
      in Secured Party’s power.

     

    11. Setoff.

     

    Debtor
      agrees that Secured Party may exercise its rights of setoff with respect to
      the
      Obligations in the same manner as if the Obligations were
      unsecured.

     

    12. Binding
      Upon Successors.

     

    All
      rights of Secured Party under this Pledge Agreement shall inure to the benefit
      of its heirs, executors, administrators, successors and assigns, and all
      obligations of Debtor shall bind its successors and assigns.

     

    
      
         

      

      
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    13. Severability.

     

    If
      any of
      the provisions of this Pledge Agreement shall be held invalid or unenforceable,
      this Pledge Agreement shall be construed as if not containing those provisions
      and the rights and obligations of the parties hereto shall be construed and
      enforced accordingly.

     

    14. Choice
      of Law.

     

    This
      Pledge Agreement shall be construed in accordance with and governed by the
      laws
      of California, without giving effect to choice of law rules, and, where
      applicable and except as otherwise defined herein, terms used herein shall
      have
      the meanings given them in the Uniform Commercial Code of such
      state.

     

    15. Amendment.

     

    This
      Pledge Agreement may not be amended or modified except by a writing signed
      by
      each of the parties hereto.

     

    16. Addresses
      for Notices.

     

    All
      demands, notices, and other communications to Debtor or Secured Party provided
      for hereunder shall be in writing or by telephone, promptly confirmed in
      writing, mailed, delivered, or sent by telefacsimile, addressed or sent to
      it to
      the address or telefacsimile number, as the case may be, of Debtor or Secured
      Party set forth beneath such party’s signature below, or to such other address
      as shall be designated by a party in a written notice to the other party. All
      such demands, notices, and other communications shall, when mailed or sent
      by
      telefacsimile, be effective when deposited in the mails, delivered or so sent,
      as the case may be, addressed as aforesaid.

     

    
      
         

      

      
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    17. Execution
      in Counterparts.

     

    This
      Pledge Agreement may be executed in counterparts each of which when so executed
      shall be deemed to be an original and all of which when taken together shall
      constitute one and the same agreement.

     

    
      	
              EXECUTED
                as of the date first written above. 

            	
            
	 	 	 	 
	
              DEBTOR: 

            	PATIENT SAFETY TECHNOLOGIES,
              INC.,
	 	a Delaware
              corporation 
	 	 	 	 
	 	By: 	 
	 	Name: 	 
	 	Title: 	 
	 	 	 	 
	 	Address: 	1800 Century Park East, Suite
              200
	 	 	Los Angeles, CA
              90067 


    

     

    
      	
              SECURED
                PARTY:

            	 
	 	
            
	 	By: 	 
	 	Name: 	Steven
              J. Caspi 
	 	 	 	 
	 	Address: 	3010 Westchester Avenue
	 	 	Purchase, New York
              10577


    

     

    
      
         

      

      
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    Schedule
      I

     

    Pledged
      Securities

     

    
      	
              Name
                of Issuer

            	 	
              Certificate
                No.

            	 	
              No.
                of Shares

            	 	
              %
                of Ownership
                in
                Issuer

            	 
	 	 	 	 	 	 	 	 
	
              Digicorp

            	 	 	
              2745
                and 2746; Held through AGB Securities

            	 	 	
              2,421,292

            	 	 	
              7.2

            	
              %

            
	 	 	 	 	 	 	 	 	 	 	 
	
              IPEX
                Inc.

            	 	 	
              1224
                and 1077; Warrants A-116 and B-116; Held through AGB
                Securities

            	 	 	
              950,000;
                
450,000

            	 	 	
              7.8

            	
              %

            
	 	 	 	 	 	 	 	 	 	 	 
	
              Automotive
                Services Group, Inc.

            	 	 	
              1

            	 	 	
              200

            	 	 	
              100

            	
              %

            
	 	 	 	 	 	 	 	 	 	 	 
	
              Alacra,
                Inc.

            	 	 	
              F-6

            	 	 	
              321,543

            	 	 	
              1.6

            	
              %

            


    

     

    
      
         

      

      
        10