EXHIBIT
10.25




Executive
Services Agreement




July 11,
2008





Bill
Adams


President


Patient
Safety Technologies, Inc.


43460
Ridge Park Drive, Suite 140


Temecula,
CA 92590





Dear
Bill:





Tatum,
LLC (“Tatum,” “we,” or “us”) is pleased that Patient Safety Technologies, Inc.
(the “Company,” “you” or “your”) desires to employ Mary Lay, a member of Tatum
(the “Employee”), to serve as the interim Chief Financial Officer of the
Company.  This letter along with the terms and conditions attached as
Exhibit A and any other exhibits or schedules attached hereto (collectively, the
“Agreement”) confirms our mutual understanding of the terms and conditions upon
which we will make available to you the Employee and Tatum’s intellectual
capital to the Employee for use in connection with the Employee’s employment
relationship with you.





Effective
as of July 14, 2008, the Employee will become your employee serving in the
capacity set forth above.  The Employee will work on a full-time basis
and be subject to the supervision, direction and control of and report directly
to the Company’s management.  While the Employee will remain a member
of Tatum and have access to Tatum’s intellectual capital to be used in
connection with the Employee’s employment relationship with you, we will have no
supervision, direction or control over the Employee with respect to the services
provided by the Employee to you.




You will
pay directly to the Employee a salary of $14,000 per month
(“Salary”).  In addition, you will reimburse the Employee for
out-of-pocket expenses incurred by the Employee to the same extent that you
reimburse other senior managers for such expenses.  In addition, you
will pay directly to Tatum a fee of $6,000 per month (“Fees”). The term of this
agreement is six months (180 days) after which time the above salary and fees
will be increased to $17,500 and $7,500 respectively for up to an additional
three months (90 days). In the event you terminate the agreement after 120 days
but prior to 180 days, other than to convert the Employee to a permanent
employee, the salary and fees will retroactively be adjusted to $17,500 and
$7,500, respectively.




Payments
to the Employee shall be made in accordance with the Company’s standard payroll
and expense reimbursement policies.  Payments to Tatum should be made
in accordance with the instructions set forth on Exhibit A at the same time
payments are made to the Employee.




Except as
specifically provided for herein, you will have no obligation to provide the
Employee with any health insurance benefits during the term of this
agreement  In lieu of the Employee participating in the
Company-sponsored employee health insurance plans, the Employee will remain on
her current health insurance plans.




As an
employee, the Employee will be eligible for any bonus and equity incentives,
vacation and holidays consistent with the Company’s policy as it applies to
senior management.




You will
have the opportunity to make the Employee a permanent, full-time member of
Company management at any time during the term of this Agreement by entering
into another form of Tatum agreement, the terms of which will be negotiated at
such time. (see Exhibit A, Section 5)




As a
condition to providing the services hereunder, we require a security deposit in
an amount equal to $10,000 (the “Deposit”), which will only be used by us under
the limited circumstances described on Exhibit A.  The Deposit is due
upon the execution of this Agreement.









To the
extent the Company has directors’ and officers’ liability insurance in effect,
the Company will provide such insurance coverage for the Employee at no
additional cost to the Employee, along with written evidence to Tatum or the
Employee that the Employee is covered by such insurance.  Furthermore,
the Company will maintain such insurance coverage with respect to occurrences
arising during the term of this Agreement for at least three years following the
termination or expiration of this Agreement or will purchase a directors’ and
officers’ extended reporting period or “tail” policy to cover the
Employee.




We
appreciate the opportunity to serve you and believe this Agreement accurately
reflects our mutual understanding.  We would be pleased to discuss
this Agreement with you at your convenience.  If the foregoing is in
accordance with your understanding, please sign a copy of this Agreement and
return it to my attention.




Sincerely,




Tatum,
LLC






/s/  Mark
C. Neilson


Mark C.
Neilson, Managing Partner-San Diego






Accepted
and agreed:






Patient
Safety Technologies, Inc.











Name:  William
Adams


Title:
Chief Executive Officer









Exhibit
A




Terms and
Conditions




1.Relationship
of the Parties.  The parties agree that Tatum will be serving the
Company as an independent contractor for all purposes and not as an employee,
agent, partner of, or joint venturer with the Company and that the Employee will
be serving the Company as an employee of the Company for all purposes and not as
an independent contractor.




2.Payment
Terms.  Payments to Tatum should be made by electronic transfer in
accordance with the instructions set forth below or such alternative
instructions as provided by Tatum from time to time.  Any amounts not
paid when due may be subject to a periodic service charge equal to the lesser of
1.5% per month and the maximum amount allowed under applicable law, until such
amounts are paid in full, including assessed service charges.  In lieu
of terminating this Agreement, Tatum may suspend the provision of services
(including the Employee’s services) if amounts owed are not paid in accordance
with the terms of this Agreement.




3.Deposit.  If
the Company breaches this Agreement and fails to cure such breach as provided
for herein, Tatum will be entitled to apply the Deposit to its or the Employee’s
damages resulting from such breach.  In the event the Deposit falls
below the amount required, the Company will pay Tatum an additional amount equal
to the shortfall.  Upon the expiration or termination of this
Agreement, Tatum will return to the Company the balance of the Deposit remaining
after application of any amounts to damages as provided for herein, including,
without limitation, unfulfilled payment obligations of the Company to Tatum or
the Employee.




4.Termination.




(a)           Either
party may terminate this Agreement by providing the other party a minimum of 15
days’ advance written notice and such termination will be effective as of the
date specified in such notice, provided that such date is no earlier than 15
days after the date of delivery of the notice.  Tatum will continue to
provide, and the Company will continue to pay for, the services until the
termination effective date.




(b)           Tatum
may terminate this Agreement immediately upon written notice to the Company if:
(i) the Company is engaged in or asks Tatum or the Employee to engage in or
ignore any illegal or unethical activity; (ii) the Employee ceases to be a
member of Tatum for any reason; (iii) the Employee becomes disabled; or (iv) the
Company fails to pay any amounts due to Tatum or the Employee when
due.  For purposes of this Agreement, disability will be defined by
the applicable policy of disability insurance or, in the absence of such
insurance, by Tatum’s management acting in good
faith.  Notwithstanding the foregoing, in lieu of terminating this
Agreement under (ii) and (iii) above, upon the mutual agreement of the parties,
the Employee may be replaced by another Tatum member.




(c)           In
the event that a party commits a breach of this Agreement, other than for the
reasons described in the above Section, and fails to cure the same within 10
days following delivery by the non-breaching party of written notice specifying
the nature of the breach, the non-breaching party may terminate this Agreement
effective upon written notice of such termination.




(d)           The
expiration or termination of this Agreement will not destroy or diminish the
binding force and effect of any of the provisions of this Agreement that
expressly, or y reasonable implication, come into or continue in effect on or
after such expiration or termination, including, without limitation, provisions
relating to payment of fees and expenses (including witness fees and expenses),
hiring the Employee, governing law, arbitration, limitation of liability, and
indemnity.




5.Hiring the Employee Outside
of a Tatum Agreement.  The parties recognize and agree that
Tatum is responsible for introducing the Employee to the Company. Therefore, if,
at any time during the term of this Agreement or the 12-month period following
the termination or expiration of this Agreement, other than in connection with
this Agreement or another Tatum agreement, the Company employs the Employee, or
engages the Employee as an independent contractor, Tatum will be entitled to
receive as a placement fee an amount equal to thirty percent (30%) of the
Annualized Compensation (as defined below).  The amount will be due and
payable to Tatum upon written demand to the Company.  “Annualized
Compensation” means the equivalent of the Employee’s base Salary calculated on a
full-time annual basis.











6.Warranties and
Disclaimers.  It is understood that Tatum does not have a contractual
obligation to the Company other than to provide the Employee to the Company and
to provide the Employee access to Tatum’s intellectual capital to be used in
connection with the Employee’s employment relationship with the
Company.  The Company acknowledges that any information, including any
resources delivered through Tatum’s proprietary information and technology
system, will be provided by Tatum as a tool to be used in the discretion of the
Company.  Tatum will not be responsible for any action taken by the
Company in following or declining to follow any of Tatum’s or the Employee’s
advice or recommendations.  Tatum represents to the Company that Tatum
has conducted its standard screening and investigation procedures with respect
to the Employee becoming a member of Tatum, and the results of the same were
satisfactory to Tatum.  Tatum disclaims all other warranties, whether
express, implied or statutory.  Without limiting the foregoing, Tatum
makes no representation or warranty as to the services provided by the Employee,
or the accuracy or reliability of reports, projections, certifications,
opinions, representations, or any other information prepared or made by Tatum or
the Employee (collectively, the “Information”) even if derived from Tatum’s
intellectual capital, and Tatum will not be liable for any claims of reliance on
the Information or that the Information does not comply with federal, state or
local laws or regulations.  The services provided by Tatum hereunder
are for the sole benefit of the Company and not any unnamed third
parties.  The services will not constitute an audit, review, or
compilation, or any other type of financial statement reporting or attestation
engagement that is subject to the rules of the AICPA or other similar state or
national professional bodies and will not result in an opinion or any form of
assurance on internal controls.




7.Limitation of
Liability; Indemnity.




(a)           The
liability of Tatum in any and all categories and for any and all causes arising
out of this Agreement, whether based in contract, tort, negligence, strict
liability or otherwise will, in the aggregate, not exceed the actual Fees paid
by the Company to Tatum over the previous two months’ of the
Agreement.  In no event will Tatum be liable for incidental,
consequential, punitive, indirect or special damages, including, without
limitation, any interruption or loss of business, profit or
goodwill.  As a condition for recovery of any liability, the Company
must assert any claim against Tatum within three months after discovery or 60
days after the termination or expiration of this Agreement, whichever is
earlier.




(b)           The
Company agrees to indemnify Tatum and the Employee to the full extent permitted
by law for any losses, costs, damages, and expenses (including reasonable
attorneys’ fees), as they are incurred, in connection with any cause of action,
suit, or other proceeding arising in connection with the Employee’s services to
the Company.




8.Governing Law,
Arbitration, and Witness Fees.




(a)           This
Agreement will be governed by and construed in accordance with the laws of the
State of Georgia, without regard to conflicts of laws provisions.




(b)           If
the parties are unable to resolve any dispute arising out of or in connection
with this Agreement, the parties agree and stipulate that any such disputes will
be settled by binding arbitration in accordance with the Commercial Arbitration
Rules of the American Arbitration Association (“AAA”).  The
arbitration will be conducted in the Atlanta, Georgia office of the AAA by a
single arbitrator selected by the parties according to the rules of the AAA, and
the decision of the arbitrator will be final and binding on both
parties.  In the event that the parties fail to agree on the selection
of the arbitrator within 30 days after either party’s request for arbitration
under this Section, the arbitrator will be chosen by the AAA.  The
arbitrator may in his or her discretion order documentary discovery but will not
allow depositions without a showing of compelling need.  The
arbitrator will render his or her decision within 90 days after the call for
arbitration.  Judgment on the award of the arbitrator may be entered
in and enforced by any court of competent jurisdiction.  The
arbitrator will have no authority to award damages in excess or in contravention
of this Agreement and may not amend or disregard any provision of this
Agreement, including this Section.  Notwithstanding the foregoing,
either party may seek appropriate injunctive relief from any court of competent
jurisdiction, and Tatum may pursue payment of undisputed amounts through any
court of competent jurisdiction.




(c)           In
the event any member or employee of Tatum (including, without limitation, the
Employee to the extent not otherwise entitled in his or her capacity as an
employee of the Company) is requested or authorized by the Company or is
required by government regulation, subpoena, or other legal process to produce
documents or appear as witnesses in connection with any action, suit or other
proceeding initiated by a third party against the Company or by the Company
against a third party, the Company will, so long as Tatum is not a party to the
proceeding in which the information is sought, reimburse Tatum for its member’s
or employee’s professional time (based on customary rates) and expenses, as well
as the fees and expenses of its counsel (including the allocable cost of
in-house counsel), incurred in responding to such requests.











9.Miscellaneous.




(a)           This
Agreement constitutes the entire agreement between the parties with regard to
the subject matter hereof and supersede any and all agreements, whether oral or
written, between the parties with respect to its subject matter.  No
amendment or modification to this Agreement will be valid unless in writing and
signed by both parties.




(b)           If
any portion of this Agreement is found to be invalid or unenforceable, such
provision will be deemed severable from the remainder of this Agreement and will
not cause the invalidity or unenforceability of the remainder of this Agreement,
except to the extent that the severed provision deprives either party of a
substantial portion of its bargain.




(c)           Neither
the Company nor Tatum will be deemed to have waived any rights or remedies
accruing under this Agreement unless such waiver is in writing and signed by the
party electing to waive the right or remedy.  The waiver by any party
of a breach or violation of any provision of this Agreement will not operate or
be construed as a waiver of any subsequent breach of such provision or any other
provision of this Agreement.




(d)           Neither
party will be liable for any delay or failure to perform under this Agreement
(other than with respect to payment obligations) to the extent such delay or
failure is a result of an act of God, war, earthquake, civil disobedience, court
order, labor dispute, or other cause beyond such party’s reasonable
control.




(e)           The
Company may not assign its rights or obligations under this Agreement without
the express written consent of Tatum.  Nothing in this Agreement will
confer any rights upon any person or entity other than the parties hereto and
their respective successors and permitted assigns and the Employee.




(f)           The
Company agrees to reimburse Tatum for all costs and expenses incurred by Tatum
in enforcing collection of any monies due under this Agreement, including,
without limitation, reasonable attorneys’ fees.




(g)           The
Company agrees to allow Tatum to use the Company’s logo and name on Tatum’s
website and other marketing materials for the sole purpose of identifying the
Company as a client of Tatum.  Tatum will not use the Company’s logo
or name in any press release or general circulation advertisement without the
Company’s prior written consent.