Document:

Exhibit
      4.20

    

    THE
      SECURITIES REPRESENTED HEREBY MAY NOT BE TRANSFERRED UNLESS
      (I) SUCH SECURITIES HAVE BEEN REGISTERED FOR SALE PURSUANT TO THE
      SECURITIES ACT OF 1933, AS AMENDED, (II) SUCH SECURITIES MAY BE SOLD
PURSUANT
      TO RULE 144(K), OR (III) THE COMPANY HAS RECEIVED AN OPINION OF
      COUNSEL REASONABLY SATISFACTORY TO IT THAT SUCH TRANSFER MAY LAWFULLY
      BE MADE WITHOUT REGISTRATION UNDER THE SECURITIES ACT OF 1933
      OR
      QUALIFICATION UNDER APPLICABLE STATE SECURITIES LAWS.

    

    SUBJECT
      TO THE PROVISIONS OF SECTION 10 HEREOF, THIS WARRANT SHALL
      BE
      VOID AFTER 5:00 P.M. EASTERN TIME ON NOVEMBER 3, 2011 (the “EXPIRATION
      DATE”).

    

    PATIENT
      SAFETY TECHNOLOGIES, INC.

    

    WARRANT
      TOPURCHASE 100,000 SHARES OF

    COMMON
      STOCK, PAR VALUE $0.33 PER SHARE

    

    FOR
      VALUE
      RECEIVED, Charles J. Kalina III
      (“Warrantholder”),
      is entitled to purchase,
      subject to the provisions of this Warrant, from Patient Safety Technologies,
      Inc., a Delaware
      corporation (the “Company”), at any time not later than 5:00 P.M., Eastern time,
      on the
      Expiration Date (as defined above), at an exercise price per share equal $1.25
      (the exercise price
      in
      effect being herein called the “Warrant Price”), 100,000 shares (“Warrant
      Shares”) of the Company’s
      Common Stock, par value $0.33 per share (“Common Stock”). The number of
Warrant
      Shares purchasable upon exercise of this Warrant and the Warrant Price shall
      be
      subject to
      adjustment from time to time as described herein.

    

    Section
      1. Registration.
      The
      Company shall maintain books for the transfer and registration
      of the Warrant. Upon the initial issuance of this Warrant, the Company shall
      issue and
      register the Warrant in the name of the Warrantholder.

    

    Section
      2. Transfers.
      As
      provided herein, this Warrant may be transferred only pursuant
      to a registration statement filed under the Securities Act of 1933, as amended
      (the “Securities
      Act”), or an exemption from such registration. Subject to such restrictions, the
      Company
      shall transfer this Warrant from time to time upon the books to be maintained
      by
      the Company for that purpose, upon surrender thereof for transfer properly
      endorsed or accompanied by
      appropriate instructions for transfer and such other documents as may be
      reasonably required by
      the
      Company, including, if required by the Company, an opinion of its counsel to
      the
      effect that
      such
      transfer is exempt from the registration requirements of the Securities Act,
      to
      establish that
      such
      transfer is being made in accordance with the terms hereof, and a new Warrant
      shall be issued to the transferee and the surrendered Warrant shall be canceled
      by the Company.

    

    
      
         

      

      
         

        
          

        

      

      
         

      

       

    

    Section
      3. Exercise
      of Warrant. Subject
      to the provisions hereof, the Warrantholder may
      exercise this Warrant in whole or in part at any time prior to its expiration
      upon surrender of the Warrant, together with delivery of the duly executed
      Warrant exercise form attached hereto as
      Appendix A (the “Exercise Agreement”) and payment by cash, certified check or
      wire transfer of
      funds
      for the aggregate Warrant Price for that number of Warrant Shares then being
      purchased,
      to the Company during normal business hours on any business day at the Company’s
      principal executive offices (or such other office or agency of the Company
      as it
      may designate by notice
      to
      the Warrantholder). The Warrant Shares so purchased shall be deemed to be issued
      to the
      Warrantholder or the Warrantholder’s designee, as the record owner of such
      shares, as of the close
      of
      business on the date on which this Warrant shall have been surrendered (or
      evidence of loss,
      theft or destruction thereof and security or indemnity satisfactory to the
      Company), the Warrant
      Price shall have been paid and the completed Exercise Agreement shall have
      been
delivered.
      Certificates for the Warrant Shares so purchased, representing the aggregate
      number of
      shares
      specified in the Exercise Agreement, shall be delivered to the Warrantholder
      within a reasonable
      time, not exceeding three (3) business days, after this Warrant shall have
      been
      so exercised.
      The certificates so delivered shall be in such denominations as may be requested
      by the Warrantholder and shall be registered in the name of the Warrantholder
      or
      such other name as
      shall
      be designated by the Warrantholder. If this Warrant shall have been exercised
      only in part,
      then, unless this Warrant has expired, the Company shall, at its expense, at
      the
      time of delivery
      of such certificates, deliver to the Warrantholder a new Warrant representing
      the number
      of
      shares with respect to which this Warrant shall not then have been exercised.
      As
      used herein,
      “business day” means a day, other than a Saturday or Sunday, on which banks in
      New York
      City
      are open for the general transaction of business. Each exercise hereof shall
      constitute the
      re-affirmation that the Warrantholder is an accredited investor according to
      Rule 501 of Regulation
      D.

    

    Section
      4. Compliance
      with the Securities Act of 1933. The
      Company may cause the legend
      set forth on the first page of this Warrant to be set forth on each Warrant
      or
      similar legend on
      any
      security issued or issuable upon exercise of this Warrant, unless counsel for
      the Company is
      of the
      opinion as to any such security that such legend is unnecessary.

    

    Section
      5. Payment
      of Taxes. The
      Company will pay any documentary stamp taxes attributable
      to the initial issuance of Warrant Shares issuable upon the exercise of the
      Warrant; provided, however, that the Company shall not be required to pay any
      tax or taxes which may be payable
      in respect of any transfer involved in the issuance or delivery of any
      certificates for Warrant
      Shares in a name other than that of the Warrantholder in respect of which such
      shares are
      issued, and in such case, the Company shall not be required to issue or deliver
      any certificate for
      Warrant Shares or any Warrant until the person requesting the same has paid
      to
      the Company the
      amount of such tax or has established to the Company’s reasonable satisfaction
      that such tax has been paid. The Warrantholder shall be responsible for income
      taxes due under federal, state or
      other
      law, if any such tax is due.

    

    Section
      6. Mutilated
      or Missing Warrants. In
      case
      this Warrant shall be mutilated, lost,
      stolen, or destroyed, the Company shall issue in exchange and substitution
      of
      and upon cancellation of the mutilated Warrant, or in lieu of and substitution
      for the Warrant lost, stolen or destroyed,
      a new Warrant of like tenor and for the purchase of a like number of Warrant
      Shares, but
      only
      upon receipt of evidence reasonably satisfactory to the Company of such loss,
      theft or destruction of the Warrant, and with respect to a lost, stolen or
      destroyed Warrant, reasonable indemnity or bond with respect thereto, if
      requested by the Company.

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    Section
      7. Reservation
      of Common Stock. The
      Company hereby represents and warrants
      that there have been reserved, and the Company shall at all applicable times
      keep reserved
      until issued (if necessary) as contemplated by this Section 7, out of the
      authorized and unissued shares of Common Stock, sufficient shares to provide
      for
      the exercise of the rights of purchase
      represented by this Warrant. The Company agrees that all Warrant Shares issued
      upon due
      exercise of the Warrant shall be, at the time of delivery of the certificates
      for such Warrant Shares,
      duly authorized, validly issued, fully paid and non-assessable shares of Common
      Stock of
      the
      Company.

    

    Section
      8. Adjustments.
      Subject
      and pursuant to the provisions of this Section 8, unless
      waived in a particular case by the Warrantholder, the Warrant Price and number
      of Warrant
      Shares subject to this Warrant shall be subject to adjustment from time to
      time
      as set forth
      hereinafter.

    

    (a) If
      the
      Company shall, at any time or from time to time while this Warrant is
outstanding,
      pay a dividend or make a distribution on its Common Stock in shares of Common
      Stock,
      subdivide its outstanding shares of Common Stock into a greater number of shares
      or combine
      its outstanding shares of Common Stock into a smaller number of shares or issue
      by reclassification
      of its outstanding shares of Common Stock any shares of its capital stock
(including
      any such reclassification in connection with a consolidation or merger in which
      the Company is the continuing corporation), then the number of Warrant Shares
      purchasable upon exercise of the Warrant and the Warrant Price in effect
      immediately prior to the date upon which such change shall become effective,
      shall be adjusted by the Company so that the Warrantholder thereafter
      exercising the Warrant shall be entitled to receive the number of shares of
      Common Stock
      or
      other capital stock which the Warrantholder would have received if the Warrant
      had been
      exercised immediately prior to such event upon payment of a Warrant Price that
      has been adjusted to reflect a fair allocation of the economics of such event
      to
      the Warrantholder. Such adjustments shall be made successively whenever any
      event listed above shall occur.

    

    (b) If
      any
      capital reorganization, reclassification of the capital stock of the
Company,
      consolidation or merger of the Company with another corporation in which the
      Company
      is not the survivor, or sale, transfer or other disposition of all or
      substantially all of the Company’s
      assets to another corporation shall be effected, then, as a condition of such
      reorganization,
      reclassification, consolidation, merger, sale, transfer or other disposition,
      lawful and
      adequate provision shall be made whereby each Warrantholder shall thereafter
      have the right to
      purchase and receive upon the basis and upon the terms and conditions herein
      specified and in lieu of the Warrant Shares immediately theretofore issuable
      upon exercise of the Warrant, such shares of stock, securities or assets as
      would have been issuable or payable with respect to or in exchange for a number
      of Warrant Shares equal to the number of Warrant Shares immediately theretofore
      issuable upon exercise of the Warrant, had such reorganization,
      reclassification, consolidation, merger, sale, transfer or other disposition
      not
      taken place, and in any such case appropriate
      provision shall be made with respect to the rights and interests of each
      Warrantholder to
      the
      end that the provisions hereof (including, without limitation, provision for
      adjustment of the
      Warrant Price) shall thereafter be applicable, as nearly equivalent as may
      be
      practicable in relation to any shares of stock, securities or assets thereafter
      deliverable upon the exercise hereof.

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    The
      Company shall not effect any such consolidation, merger, sale, transfer or
      other
      disposition unless
      prior to or simultaneously with the consummation thereof the successor
      corporation (if other
      than the Company) resulting from such consolidation or merger, or the
      corporation purchasing
      or otherwise acquiring such assets or other appropriate corporation or entity
      shall assume
      the obligation to deliver to the Warrantholder, at the last address of the
      Warrantholder appearing
      on the books of the Company, such shares of stock, securities or assets as,
      in
accordance
      with the foregoing provisions, the Warrantholder may be entitled to purchase,
      and the
      other
      obligations under this Warrant. The provisions of this paragraph (b) shall
      similarly apply
      to
      successive reorganizations, reclassifications, consolidations, mergers, sales,
      transfers or other dispositions.

    

    (c)
      In
      case the Company shall fix a payment date for the making of a distribution
      to all holders of Common Stock (including any such distribution made in
      connection with a consolidation or merger in which the Company is the continuing
      corporation) of evidences of
      indebtedness or assets (other than cash dividends or cash distributions payable
      out of consolidated
      earnings or earned surplus or dividends or distributions referred to in Section
      8(a)), or subscription rights or warrants, the Warrant Price to be in effect
      after such payment date shall be determined by multiplying the Warrant Price
      in
      effect immediately prior to such payment date by a fraction, the numerator
      of
      which shall be the total number of shares of Common Stock outstanding
multiplied
      by the Market Price (as defined below) per share of Common Stock immediately
      prior to
      such
      payment date, less the fair market value (as determined by the Company’s Board
      of Directors
      in good faith) of said assets or evidences of indebtedness so distributed,
      or of
      such subscription
      rights or warrants, and the denominator of which shall be the total number
      of
      shares of
      Common
      Stock outstanding multiplied by such Market Price per share of Common Stock
      immediately
      prior to such payment date. “Market Price” as of a particular date (the
“Valuation Date”)
      shall mean the following: (a) if the Common Stock is then listed on a national
      stock exchange,
      the closing sale price of one share of Common Stock on such exchange on the
      last
trading
      day prior to the Valuation Date; (b) if the Common Stock is then quoted on
      The
      Nasdaq Stock Market, Inc. (“Nasdaq”), the National Association of Securities
      Dealers, Inc. OTC Bulletin Board (the “Bulletin Board”) or such similar exchange
      or association, the closing sale price of one share
      of
      Common Stock on Nasdaq, the Bulletin Board or such other exchange or association
      on the
      last
      trading day prior to the Valuation Date or, if no such closing sale price is
      available, the average
      of the high bid and the low asked price quoted thereon on the last trading
      day
      prior to
      the
      Valuation Date; or (c) if the Common Stock is not then listed on a national
      stock exchange
      or quoted on Nasdaq, the Bulletin Board or such other exchange or association,
      the fair market
      value of one share of Common Stock as of the Valuation Date, shall be determined
      in good
      faith by the Board of Directors of the Company and the Warrantholder. If the
      Common Stock
      is
      not then listed on a national securities exchange, the Bulletin Board or such
      other exchange
      or association, the Board of Directors of the Company shall respond promptly,
      in
writing,
      to an inquiry by the Warrantholder prior to the exercise hereunder as to the
      fair market value of a share of Common Stock as determined by the Board of
      Directors of the Company. In the
      event
      that the Board of Directors of the Company and the Warrantholder are unable
      to
      agree upon
      the
      fair market value in respect of subpart (c) hereof, the Company and the
      Warrantholder shall
      jointly select an appraiser, who is experienced in such matters. The decision
      of
      such appraiser shall
      be
      final and conclusive, and the cost of such appraiser shall be borne equally
      by the Company and the Warrantholder. Such adjustment shall be made successively
      whenever
      such a payment date is fixed.

    

    
      
         

      

      
         

        
          

        

      

      
         

      

       

    

    (d) An
      adjustment to the Warrant Price shall become effective immediately after
      the
      payment date in the case of each dividend or distribution and immediately after
      the effective
      date of each other event which requires an adjustment.

    

    (e) In
      the
      event that, as a result of an adjustment made pursuant to this Section 8,
the
      Warrantholder shall become entitled to receive any shares of capital stock
      of
      the Company other
      than shares of Common Stock, the number of such other shares so receivable
      upon
      exercise of
      this
      Warrant shall be subject thereafter to adjustment from time to time in a manner
      and on terms
      as
      nearly equivalent as practicable to the provisions with respect to the Warrant
      Shares contained in this Warrant.

    

    Section
      9. Fractional
      Interest. The
      Company shall not be required to issue fractions of
      Warrant Shares upon the exercise of this Warrant. If any fractional share of
      Common Stock would,
      except for the provisions of the first sentence of this Section 9, be
      deliverable upon such exercise, the Company, in lieu of delivering such
      fractional share, shall pay to the exercising Warrantholder an amount in cash
      equal to the Market Price of such fractional share of Common Stock on the date
      of exercise.

    

    Section
      10. Benefits.
      Nothing
      in this Warrant shall be construed to give any person, firm
      or
      corporation (other than the Company and the Warrantholder) any legal or
      equitable right, remedy
      or
      claim, it being agreed that this Warrant shall be for the sole and exclusive
      benefit of the
      Company and the Warrantholder.

    

    Section
      11. Limitations
      on Exercise. Notwithstanding
      anything to the contrary contained
      herein, the number of Warrant Shares that may be acquired by Warrantholder
      upon
      any exercise of this Warrant (or otherwise in respect hereof) shall be limited
      to the extent necessary to insure
      that, following such exercise (or other issuance), the total number of shares
      of
      Common Stock
      then beneficially owned by Warrantholder and its affiliates and any other
      persons whose beneficial
      ownership of Common Stock would be aggregated with the Warrantholder’s for
      purposes of
      Section 13(d) of the Exchange Act does not exceed 9.999% of the total number
      of
      issued and outstanding shares of Common Stock (including for such purpose the
      shares of Common Stock issuable upon such exercise). For such purposes,
      beneficial ownership shall be determined in accordance with Section 13(d) of
      the
      Exchange Act and the rules and regulations promulgated thereunder.
      This restriction may not be waived and may not be amended by agreement of the
      parties.

    

    Section
      12. Trading
      Market Limitations. Unless
      permitted by the applicable rules and regulations
      of the principal securities market on which the Common Stock is then listed
      or
      traded, in no
      event
      shall the Company issue upon exercise of or otherwise pursuant to this Warrant
      and upon conversion of or otherwise pursuant to the Note issued in connection
      with this Warrant more than the
      maximum number of shares of Common Stock that the Company can issue pursuant
      to
      any rule of the principal securities market on which the Common Stock is then
      traded (the “Maximum Share Amount”),
      which shall be 19.99% of the total shares of Common Stock then outstanding.
      In
      the event
      that the sum of (x) the aggregate number of shares of Common Stock issued upon
      exercise of this Warrant and upon conversion of the Note and (y) the aggregate
      number of shares of Common Stock that remain issuable upon exercise of the
      Warrant and conversion of the Note represents at least one hundred percent
      (100%) of the Maximum Share Amount (the “Triggering Event”), the Company will
      use its best efforts to seek and obtain Stockholder Approval (or obtain such
      other relief as will allow exercises hereunder in excess of the Maximum Share
      Amount) as soon as practicable
      following the Triggering Event. As used herein, “Stockholder Approval” means
approval
      by the shareholders of the Company to authorize the issuance of the full number
      of shares of
      Common
      Stock that would be issuable upon full exercise of this Warrant and upon full
      conversion
      of the Note but for the Maximum Share Amount.

    

    
      
         

      

      
         

        
          

        

      

      
         

      

       

    

    Section
      13. Stock
      Dividends and Splits. If
      the
      Company, at any time while this Warrant is outstanding,
      (i) pays a stock dividend on its Common Stock or otherwise makes a distribution
      on any class
      of
      capital stock that is payable in shares of Common Stock, (ii) subdivides
      outstanding shares of Common Stock into a larger number of shares, or (iii)
      combines outstanding shares of Common Stock into a smaller number of shares,
      then in each such case the Warrant Price shall be multiplied by a fraction
      of
      which the numerator shall be the number of shares of Common Stock outstanding
      immediately before such event and of which the denominator shall be the number
      of shares of Common
      Stock outstanding immediately after such event. Any adjustment made pursuant
      to
      clause (i)
      of
      this paragraph shall become effective immediately after the record date for
      the
      determination of stockholders entitled to receive such dividend or distribution,
      and any adjustment pursuant to clause (ii) or (iii) of this paragraph shall
      become effective immediately after the effective date of such subdivision or
      combination.

    

    Section
      14. Notices
      to Warrantholder. Upon
      the
      happening of any event requiring an adjustment of the Warrant Price, the Company
      shall promptly give written notice thereof to the Warrantholder
      at the address appearing in the records of the Company, stating the adjusted
      Warrant
      Price and the adjusted number of Warrant Shares resulting from such event and
      setting forth
      in
      reasonable detail the method of calculation and the facts upon which such
      calculation is based. Failure to give such notice to the Warrantholder or any
      defect therein shall not affect the legality or validity of the subject
      adjustment.

    

    Section
      15. Notices.
      Unless
      otherwise provided, any notice required or permitted under
      this Warrant shall be given in writing and shall be deemed effectively given
      as
      hereinafter described
      (i) if given by personal delivery, then such notice shall be deemed given upon
      such delivery,
      (ii) if given by telex or facsimile, then such notice shall be deemed given
      upon
      receipt of
      confirmation of complete transmittal, (iii) if given by mail, then such notice
      shall be deemed given upon the earlier of (A) receipt of such notice by the
      recipient or (B) three days after such notice
      is
      deposited in first class mail, postage prepaid, and (iv) if given by an
      internationally recognized overnight air courier, then such notice shall be
      deemed given one business day after delivery to such carrier. All notices shall
      be addressed as follows: if to the Warrantholder, at its address as set forth
      in
      the Company’s books and records and, if to the Company, at the address as
follows,
      or at such other address as the Warrantholder or the Company may designate
      by
      ten days’
      advance written notice to the other:

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    If
      to the
      Company:

     

    Patient
      Safety Technologies, Inc. 

    1800
      Century Park East, Suite 200 

    Los
      Angeles, California 90067 

    Attn:
      Lynne
      Silverstein

    Telephone:
      (310) 895-7750

    Facsimile:
      (310) 895-7751

    

    With
      a
      copy to (which shall not constitute notice):

    Sichenzia
      Ross Friedman Ference LLP

    1065
      Avenue of the Americas 

    New
      York,
      New York 10018 

    Attention:
      Marc J. Ross, Esq. 

    Telephone:
      (212) 930-9700 

    Facsimile:
      (212) 930-9725

    

    Section
      16. Successors.
      All
      the
      covenants and provisions hereof by or for the benefit of
      the
      Warrantholder shall bind and inure to the benefit of its respective successors
      and assigns hereunder.

    

    Section
      17. Governing
      Law; Consent to Jurisdiction; Waiver of Jury Trial. This
      Warrant
      shall be governed by, and construed in accordance with, the internal laws of
      the
      State of California,
      without reference to the choice of law provisions thereof. The Company and,
      by
accepting
      this Warrant, the Warrantholder, each irrevocably submits to the exclusive
      jurisdiction of
      the
      courts of the State of California located in Los Angeles County and federal
      courts located in Los
      Angeles County, California for the purpose of any suit, action, proceeding
      or
      judgment relating
      to or arising out of this Warrant and the transactions contemplated hereby.
      Service of process
      in connection with any such suit, action or proceeding may be served on each
      party hereto
      anywhere in the world by the same methods as are specified for the giving of
      notices under
      this Warrant. The Company and, by accepting this Warrant, the Warrantholder,
      each irrevocably
      consents to the jurisdiction of any such court in any such suit, action or
      proceeding and to
      the
      laying of venue in such court. The Company and, by accepting this Warrant,
      the
Warrantholder,
      each irrevocably waives any objection to the laying of venue of any such suit,
      action
      or
      proceeding brought in such courts and irrevocably waives any claim that any
      such
      suit, action
      or
      proceeding brought in any such court has been brought in an inconvenient forum.
      EACH
      OF THE COMPANY AND, BY ITS ACCEPTANCE HEREOF, THE WARRANTHOLDER
      HEREBY WAIVES ANY RIGHT TO REQUEST A TRIAL BY JURY
      IN ANY LITIGATION WITH RESPECT TO THIS WARRANT AND REPRESENTS
      THAT COUNSEL HAS BEEN CONSULTED SPECIFICALLY AS TO THIS
      WAIVER.

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    Section
      18. No
      Rights as Stockholder. Prior
      to
      the exercise of this Warrant, the Warrantholder
      shall not have or exercise any rights as a stockholder of the Company by virtue
      of its
      ownership of this Warrant.

    

    Section
      19. Amendment;
      Waiver. Any
      term
      of this Warrant may be amended or waived
      upon the written consent of the Company and the holder of the
      Warrant.

    

    Section
      20. Section
      Headings. The
      section headings in this Warrant are for the convenience
      of the Company and the Warrantholder and in no way alter, modify, amend, limit
      or restrict the provisions hereof.

    

    

    IN
      WITNESS WHEREOF, the Company has caused this Warrant to be duly executed as
      of
      the
      3rd
      day
      of
      November 2006.

     

     

    
      	 	
              PATIENT
                SAFETY TECHNOLOGIES, INC.

              

              By:                                                                       
                

              Name:
                Milton “Todd” Ault, III 

              Title:
                Chief Executive Officer

            

    

    
 

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    
      
APPENDIX
      A

    PATIENT
      SAFETY TECHNOLOGIES, INC.

    WARRANT
      EXERCISE FORM

    

    To
      Patient Safety Technologies, Inc.:

     

    The
      undersigned hereby irrevocably elects to exercise the right of purchase
      represented by
      the
      within Warrant (“Warrant”) for, and to purchase thereunder by the payment of the
      Warrant Price and surrender of the Warrant, 100,000 shares of Common Stock
      (“Warrant Shares”)
      provided for therein, and requests that certificates for the Warrant Shares
      be
      issued as follows:

     

                                                             
      

    Name

    

    Address
      _________________________

                   
      _________________________

    
                                                         

    Federal
      Tax ID or Social Security No.

     

    and
      delivered by (certified mail to the above address, or (electronically (provide
      DWAC Instructions:

    ________________________
      ), or (other (specify): ____________________________________ ),
      and,
      if the
      number of Warrant Shares shall not be all the Warrant Shares purchasable upon
      exercise of the Warrant, that
      a
      new Warrant for the balance of the Warrant Shares purchasable upon exercise
      of
      this Warrant be registered
      in the name of the undersigned Warrantholder or the undersigned’s Assignee as
      below indicated and delivered to the address stated below.

    

    Dated:
      ____________________ ,

     

    Note:
      The
      signature must correspond with the name of the Warrantholder as written on
      the
      first page of the
      Warrant in every particular, without alteration or enlargement or any change
      whatever, unless the Warrant has
      been
      assigned.

     

     

    
      	 	
              Warrant
                Signature:

            	
              ______________________________

            
	 	 	 
	 	
              Name
                (please print):  

            	
              ______________________________

            
	 	 	 
	 	Address	
              ______________________________

              
                ______________________________

                
                  ______________________________

                

              

            
	 	 	 
	 	Federal Identification
              or Social Security No.
	 	 	 
	 	
               Assignee:

            	
              ______________________________

              
                ______________________________

                
                  ______________________________Exhibit
      10.39

     

    SUBSCRIPTION
      AGREEMENT

     

    SUBSCRIPTION
      AGREEMENT (this “Agreement”) made as of the last date set forth on the signature
      page hereof between Patient Safety Technologies, Inc., a Delaware corporation
      (the “Company”), and the undersigned (the “Subscriber”).

     

    WITNESSETH:

     

    WHEREAS,
      the Company is conducting a private offering (the “Offering”) consisting of up
      to 1,600,000 shares (the “Shares”) of common stock, $.33 par value per share
      (“Common Stock”) and five-year warrants to purchase up to 800,000 shares of
      Common Stock at $2.00 per share (the “Warrants,” together with the Shares, the
“Securities”), pursuant to Section 4(2) of the Securities Act of 1933, as
      amended (the “Securities Act”) and Rule 506 promulgated thereunder;
      and

     

    WHEREAS,
      the Subscriber desires to purchase that number of Shares set forth on the
      signature page hereof on the terms and conditions hereinafter set
      forth.

     

    NOW,
      THEREFORE, in consideration of the premises and the mutual representations
      and
      covenants hereinafter set forth, the parties hereto do hereby agree as
      follows:

     

    
      	
              I.

            	
              SUBSCRIPTION
                FOR SHARES AND REPRESENTATIONS BY
                SUBSCRIBER

            

    

     

    1.1 Subject
      to the terms and conditions hereinafter set forth and in the Confidential
      Private Placement Memorandum dated February 28, 2007 (such memorandum, together
      with all amendments thereof and supplements and exhibits thereto, the
“Memorandum”), the Subscriber hereby irrevocably subscribes for and agrees to
      purchase from the Company such number of Shares, and the Company agrees to
      sell
      to the Subscriber as is set forth on the signature page hereof, at a per share
      price equal to $1.25 per Share. The purchase price is payable by wire transfer
      of immediately available funds to:

     

    Wire
      instructions:

    

    
      	
              Account
                Name:  

            	 	
              Transfer
                Online FBO Patient Safety Technologies, Inc.

            
	 	 	 
	
              Account
                #        

            	 	
              370151013155

            
	 	 	 
	
              Routing
                #        

            	 	
              123002011

            
	 	 	 
	
              Bank:             

            	 	
              KeyBank
                National Association

            
	 	 	 
	
              Address:           

            	 	
              444
                SW 5th Ave

            
	 	 	
              Portland,
                OR  97204

            

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    1.2 The
      Subscriber recognizes that the purchase of the Shares involves a high degree
      of
      risk including, but not limited to, the following: (a) the Company will likely
      require substantial funds in addition to the proceeds of the Offering; (b)
      an
      investment in the Company is highly speculative, and only investors who can
      afford the loss of their entire investment should consider investing in the
      Company and the Shares; (c) the Subscriber may not be able to liquidate its
      investment; (d) transferability of the Shares is limited; (e) in the event
      of a
      disposition, the Subscriber could sustain the loss of its entire investment;
      and
      (f) the Company may issue additional securities in the future which have rights
      and preferences that are senior to those of the Common Stock. Without limiting
      the generality of the representations set forth in Section 1.5 below, the
      Subscriber represents that the Subscriber has carefully reviewed the section
      of
      the Memorandum captioned “Risk Factors” as well as the exhibits to the
      Memorandum that contain additional risk factors.

     

    1.3 The
      Subscriber represents that the Subscriber is an “accredited investor” as such
      term is defined in Rule 501 of Regulation D (“Regulation D”) promulgated under
      the Securities Act, as indicated by the Subscriber’s responses to the questions
      contained in Article VII hereof, and that the Subscriber is able to bear the
      economic risk of an investment in the Shares.

     

    1.4 The
      Subscriber hereby acknowledges and represents that (a) the Subscriber has
      knowledge and experience in business and financial matters, prior investment
      experience, including investment in securities that are non-listed, unregistered
      and/or not traded on a national securities exchange nor on the National
      Association of Securities Dealers, Inc. (the “NASD”) automated quotation system
      (“NASDAQ”), or the Subscriber has employed the services of a “purchaser
      representative” (as defined in Rule 501 of Regulation D), attorney and/or
      accountant to read all of the documents furnished or made available by the
      Company both to the Subscriber and to all other prospective investors in the
      Shares to evaluate the merits and risks of such an investment on the
      Subscriber’s behalf; (b) the Subscriber recognizes the highly speculative nature
      of this investment; (c) the Subscriber is aware that the Company’s Common Stock
      has been delisted from the American Stock Exchange (the “Amex”) and that the
      appropriate steps are being taken to have the Common Stock included for
      quotation on the OTC Bulletin Board but that there can be no assurance that
      the
      Common will be so included on an expedited basis, if at all; (d) the Subscriber
      understands that the Shares are a less liquid investment as a result of the
      delisting from the Amex; and (e) the Subscriber is able to bear the economic
      risk that the Subscriber hereby assumes.

     

    1.5 The
      Subscriber hereby acknowledges receipt and careful review of this Agreement,
      the
      Memorandum, including all exhibits thereto, all reports, schedules, forms
      statements and other documents required to be filed by it under the Securities
      Act and the Securities Exchange Act of 1934, as amended (the “Exchange Act”),
      including pursuant to Section 13(a) or 15(d) thereof, for the twelve months
      preceding the date hereof (or such shorter period as the Company was required
      by
      law to file such reports) (the foregoing materials being collectively referred
      to herein as the “SEC Reports” and, together with the Agreement and the
      Memorandum, and any documents which may have been made available upon request
      as
      reflected therein (collectively referred to as the “Offering Materials”) and
      hereby represents that the Subscriber has been furnished by the Company during
      the course of the Offering with all information regarding the Company, the
      terms
      and conditions of the Offering and any additional information that the
      Subscriber has requested or desired to know, and has been afforded the
      opportunity to ask questions of and receive answers from duly authorized
      officers or other representatives of the Company concerning the Company and
      the
      terms and conditions of the Offering.

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    1.6 (a) In
      making
      the decision to invest in the Shares the Subscriber has relied solely upon
      the
      information provided by the Company in the Offering Materials. To the extent
      necessary, the Subscriber has retained, at its own expense, and relied upon
      appropriate professional advice regarding the investment, tax and legal merits
      and consequences of this Agreement and the purchase of the Shares hereunder.
      The
      Subscriber disclaims reliance on any statements made or information provided
      by
      any person or entity in the course of Subscriber’s consideration of an
      investment in the Shares other than the Offering Materials. 

     

    (b) The
      Subscriber represents that (i) the Subscriber was contacted regarding the sale
      of the Shares by the Company (or an authorized agent or representative thereof)
      with whom the Subscriber had a prior substantial pre-existing relationship
      and
      (ii) no Shares were offered or sold to it by means of any form of general
      solicitation or general advertising, and in connection therewith, the Subscriber
      did not (A) receive or review any advertisement, article, notice or other
      communication published in a newspaper or magazine or similar media or broadcast
      over television or radio, whether closed circuit, or generally available; or
      (B)
      attend any seminar meeting or industry investor conference whose attendees
      were
      invited by any general solicitation or general advertising.

     

    1.7 The
      Subscriber hereby represents that the Subscriber, either by reason of the
      Subscriber’s business or financial experience or the business or financial
      experience of the Subscriber’s professional advisors (who are unaffiliated with
      and not compensated by the Company or any affiliate or selling agent of the
      Company, directly or indirectly), has the capacity to protect the Subscriber’s
      own interests in connection with the transaction contemplated
      hereby.

     

    1.8 The
      Subscriber hereby acknowledges that the Offering has not been reviewed by the
      United States Securities and Exchange Commission (the “SEC”) nor any state
      regulatory authority since the Offering is intended to be exempt from the
      registration requirements of Section 5 of the Securities Act, pursuant to
      Regulation D. The Subscriber understands that the Shares have not been
      registered under the Securities Act or under any state securities or “blue sky”
laws and agrees not to sell, pledge, assign or otherwise transfer or dispose
      of
      the Shares unless they are registered under the Securities Act and under any
      applicable state securities or “blue sky” laws or unless an exemption from such
      registration is available.

     

    1.9 The
      Subscriber understands that the Shares have not been registered under the
      Securities Act by reason of a claimed exemption under the provisions of the
      Securities Act that depends, in part, upon the Subscriber’s investment
      intention. In this connection, the Subscriber hereby represents that the
      Subscriber is purchasing the Shares for the Subscriber’s own account for
      investment and not with a view toward the resale or distribution to others.
      The
      Subscriber, if an entity, further represents that it was not formed for the
      purpose of purchasing the Shares.

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    1.10 The
      Subscriber understands that, following the delisting from the Amex, the Common
      Stock is not currently traded or quoted on any market and that there is no
      market for the Common Stock until such time that it is included for quotation
      on
      the OTC Bulletin Board. The Subscriber understands that even if a public market
      redevelops for the Common Stock, Rule 144 (“Rule 144”) promulgated under the
      Securities Act requires for non-affiliates, among other conditions, a one-year
      holding period prior to the resale (in limited amounts) of securities acquired
      in a non-public offering without having to satisfy the registration requirements
      under the Securities Act. The Subscriber understands and hereby acknowledges
      that the Company is under no obligation to register any of the Shares under
      the
      Securities Act or any state securities or “blue sky” laws other than as set
      forth in Article V. 

     

    1.11 The
      Subscriber consents to the placement of a legend on any certificate or other
      document evidencing the Shares that such Shares have not been registered under
      the Securities Act or any state securities or “blue sky” laws and setting forth
      or referring to the restrictions on transferability and sale thereof contained
      in this Agreement. The Subscriber is aware that the Company will make a notation
      in its appropriate records with respect to the restrictions on the
      transferability of such Shares. The legend to be placed on each certificate
      shall be in form substantially similar to the following:

     

    “The
      securities represented by this certificate have not been registered under the
      Securities Act of 1933, as amended and may not be sold, transferred, pledged,
      hypothecated or otherwise disposed of in the absence of (i) an effective
      registration statement for such securities under said act or (ii) an opinion
      of
      company counsel that such registration is not required.”

    

    1.12 The
      Subscriber understands that the Company will review this Agreement and is hereby
      given authority by the Subscriber to call Subscriber’s bank or place of
      employment or otherwise review the financial standing of the Subscriber; and
      it
      is further agreed that the Company, at its sole discretion, reserves the
      unrestricted right, without further documentation or agreement on the part
      of
      the Subscriber, to reject or limit any subscription, to accept subscriptions
      for
      fractional Shares and to close the Offering to the Subscriber at any time and
      that the Company will issue stop transfer instructions to its transfer agent
      with respect to such Shares.

     

    1.13 The
      Subscriber hereby represents that the address of the Subscriber furnished by
      Subscriber on the signature page hereof is the Subscriber’s principal residence
      if Subscriber is an individual or its principal business address if it is a
      corporation or other entity.

     

    1.14 The
      Subscriber represents that the Subscriber has full power and authority
      (corporate, statutory and otherwise) to execute and deliver this Agreement
      and
      to purchase the Shares. This Agreement constitutes the legal, valid and binding
      obligation of the Subscriber, enforceable against the Subscriber in accordance
      with its terms.

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    1.15 If
      the
      Subscriber is a corporation, partnership, limited liability company, trust,
      employee benefit plan, individual retirement account, Keogh Plan, or other
      tax-exempt entity, it is authorized and qualified to invest in the Company
      and
      the person signing this Agreement on behalf of such entity has been duly
      authorized by such entity to do so.

     

    1.16 The
      Subscriber acknowledges that if he or she is a Registered Representative of
      an
      NASD member firm, he or she must give such firm the notice required by the
      NASD’s Rules of Fair Practice, receipt of which must be acknowledged by such
      firm in Section 7.4 below.

     

    1.17 The
      Subscriber acknowledges that at such time, if ever, as the Shares are registered
      (as such term is defined in Article V hereof), sales of the Shares will be
      subject to state securities laws.

     

    1.18 (a) The
      Subscriber agrees not to issue any public statement with respect to the
      Subscriber’s investment or proposed investment in the Company or the terms of
      any agreement or covenant between them and the Company without the Company’s
      prior written consent, except such disclosures as may be required under
      applicable law or under any applicable order, rule or regulation.

     

    (b) The
      Company agrees not to disclose the names, addresses or any other information
      about the Subscribers, except as required by law; provided, that the Company
      may
      use the name of the Subscriber for any offering or in any registration statement
      filed pursuant to Article V in which the Subscriber’s shares are
      included.

     

    1.19 The
      Subscriber agrees to hold the Company and its directors, officers, employees,
      affiliates, controlling persons and agents and their respective heirs,
      representatives, successors and assigns harmless and to indemnify them against
      all liabilities, costs and expenses incurred by them as a result of (a) any
      sale
      or distribution of the Shares by the Subscriber in violation of the Securities
      Act or any applicable state securities or “blue sky” laws; or (b) any false
      representation or warranty or any breach or failure by the Subscriber to comply
      with any covenant made by the Subscriber in this Agreement (including the
      Confidential Investor Questionnaire contained in Article VII herein) or any
      other document furnished by the Subscriber to any of the foregoing in connection
      with this transaction.

    

    
      	
              II.

            	
              REPRESENTATIONS
                BY AND COVENANTS OF THE COMPANY

            

    

     

    The
      Company hereby represents and warrants to the Subscriber that:

     

    2.1 Organization,
      Good Standing and Qualification.
      The
      Company is a corporation duly organized, validly existing and in good standing
      under the laws of the State of Delaware and has full corporate power and
      authority to conduct its business.

     

    2.2 Capitalization
      and Voting Rights.
      The
      authorized, issued and outstanding capital stock of the Company is as set forth
      in the Confidential Private Placement Memorandum and
      all
      issued and outstanding shares of the Company are validly issued, fully paid
      and
      nonassessable. Except as set forth in the Offering Materials, there are no
      outstanding options, warrants, agreements, convertible securities, preemptive
      rights or other rights to subscribe for or to purchase any shares of capital
      stock of the Company. Except as set forth in the Offering Materials and as
      otherwise required by law, there are no restrictions upon the voting or transfer
      of any of the shares of capital stock of the Company pursuant to the Company’s
      Certificate of Incorporation (the “Certificate of Incorporation”), Bylaws or
      other governing documents or any agreement or other instruments to which the
      Company is a party or by which the Company is bound.

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    2.3 Authorization;
      Enforceability.
      The
      Company has all corporate right, power and authority to enter into this
      Agreement and to consummate the transactions contemplated hereby. All corporate
      action on the part of the Company, its directors and stockholders necessary
      for
      the (a) authorization execution, delivery and performance of this Agreement
      by
      the Company; and (b) authorization, sale, issuance and delivery of the
      Securities contemplated hereby and the performance of the Company’s obligations
      hereunder has been taken. This Agreement has been duly executed and delivered
      by
      the Company and constitutes a legal, valid and binding obligation of the
      Company, enforceable against the Company in accordance with its terms, subject
      to laws of general application relating to bankruptcy, insolvency and the relief
      of debtors and rules of law governing specific performance, injunctive relief
      or
      other equitable remedies, and to limitations of public policy. The Shares,
      when
      issued and fully paid for in accordance with the terms of this Agreement, will
      be validly issued, fully paid and nonassessable. The issuance and sale of the
      Securities contemplated hereby will not give rise to any preemptive rights
      or
      rights of first refusal on behalf of any person which have not been waived
      in
      connection with this offering.

     

    2.4 No
      Conflict; Governmental Consents.

     

    (a) The
      execution and delivery by the Company of this Agreement and the consummation
      of
      the transactions contemplated hereby will not result in the violation of any
      material law, statute, rule, regulation, order, writ, injunction, judgment
      or
      decree of any court or governmental authority to or by which the Company is
      bound, or of any provision of the Certificate of Incorporation or Bylaws of
      the
      Company, and will not conflict with, or result in a material breach or violation
      of, any of the terms or provisions of, or constitute (with due notice or lapse
      of time or both) a default under, any lease, loan agreement, mortgage, security
      agreement, trust indenture or other agreement or instrument to which the Company
      is a party or by which it is bound or to which any of its properties or assets
      is subject, nor result in the creation or imposition of any lien upon any of
      the
      properties or assets of the Company.

     

    (b) No
      consent, approval, authorization or other order of any governmental authority
      is
      required to be obtained by the Company in connection with the authorization,
      execution and delivery of this Agreement or with the authorization, issue and
      sale of the Securities, except such filings as may be required to be made with
      the SEC, NASD, NASDAQ and with any state or foreign blue sky or securities
      regulatory authority.

     

    2.5 Licenses.
      Except
      as otherwise set forth in the Memorandum, the Company has sufficient licenses,
      permits and other governmental authorizations currently required for the conduct
      of its business or ownership of properties and is in all material respects
      in
      compliance therewith.

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

     

    2.6 Litigation.
      Except
      as set forth in the Memorandum, the Company knows of no pending or threatened
      legal or governmental proceedings against the Company which could materially
      adversely affect the business, property, financial condition or operations
      of
      the Company or which materially and adversely questions the validity of this
      Agreement or any agreements related to the transactions contemplated hereby
      or
      the right of the Company to enter into any of such agreements, or to consummate
      the transactions contemplated hereby or thereby. The Company is not a party
      or
      subject to the provisions of any order, writ, injunction, judgment or decree
      of
      any court or government agency or instrumentality which could materially
      adversely affect the business, property, financial condition or operations
      of
      the Company. There is no action, suit, proceeding or investigation by the
      Company currently pending in any court or before any arbitrator or that the
      Company intends to initiate.

     

    2.7 Disclosure.
      The
      information set forth in the Offering Materials as of the date hereof contains
      no untrue statement of a material fact nor omits to state a material fact
      necessary in order to make the statements contained therein, in light of the
      circumstances under which they were made, not misleading.

     

    2.8 Brokers.
      Except
      for Ault Glazer & Co. LLC, neither the Company nor any of the Company's
      officers, directors, employees or stockholders has employed or engaged any
      broker or finder in connection with the transactions contemplated by this
      Agreement and no fee or other compensation is or will be due and owing to any
      broker, finder, underwriter, placement agent or similar person in connection
      with the transactions contemplated by this Agreement. The Company is not party
      to any agreement, arrangement or understanding whereby any person has an
      exclusive right to raise funds and/or place or purchase any debt or equity
      securities for or on behalf of the Company.

     

    
      	
              III.

            	
              TERMS
                OF SUBSCRIPTION

            

    

     

    3.1 All
      funds
      paid hereunder shall be deposited with Transfer Online in the escrow account
      identified in Section 1.1 hereof. 

     

    3.2 Certificates
      representing the Shares and the Warrants purchased by the Subscriber pursuant
      to
      this Agreement will be prepared for delivery to the Subscriber within 15
      business days following the closing at which such purchase takes place. The
      Subscriber hereby authorizes and directs the Company to deliver the certificates
      representing the Shares and the Warrants purchased by the Subscriber pursuant
      to
      this Agreement directly to the Subscriber’s residential or business address
      indicated on the signature page hereto. 

     

    
      	
              IV.

            	
              CONDITIONS
                TO OBLIGATIONS OF THE
                SUBSCRIBERS

            

    

     

    4.1 The
      Subscriber’s obligation to purchase the Shares at the closing at which such
      purchase is to be consummated is subject to the fulfillment on or prior to
      such
      closing of the following conditions, which conditions may be waived at the
      option of each Subscriber to the extent permitted by law:

     

    (a) Covenants.
      All
      covenants, agreements and conditions contained in this Agreement to be performed
      by the Company on or prior to the date of such closing shall have been performed
      or complied with in all material respects.

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

     

    (b) No
      Legal Order Pending.
      There
      shall not then be in effect any legal or other order enjoining or restraining
      the transactions contemplated by this Agreement.

     

    (c) No
      Law
      Prohibiting or Restricting Such Sale.
      There
      shall not be in effect any law, rule or regulation prohibiting or restricting
      such sale or requiring any consent or approval of any person, which shall not
      have been obtained, to issue the Shares (except as otherwise provided in this
      Agreement).

     

    
      	
              V.

            	
              REGISTRATION
                RIGHTS

            

    

     

    5.1 Definitions.
      As used
      in this Agreement, the following terms shall have the following
      meanings.

     

    (a) The
      term
“Closing Date” shall mean the earlier of: (i) the date on which subscriptions
      for Shares totaling $2,000,000 shall have been received and accepted by the
      Company, or (ii) May 31, 2007

     

    (b) The
      term
“Holder” shall mean any person owning or having the right to acquire Registrable
      Securities or any permitted transferee of a Holder.

     

    (c) The
      terms
“register,” “registered” and “registration” refer to a registration effected by
      preparing and filing a registration statement or similar document in compliance
      with the Securities Act, and the declaration or order of effectiveness of such
      registration statement or document.

     

    (d) The
      term
“Registrable Securities” shall mean the Shares; provided, however, that
      securities shall only be treated as Registrable Securities if and only for
      so
      long as they (A) have not been disposed of pursuant to a registration statement
      declared effective by the SEC; (B) have not been sold in a transaction exempt
      from the registration and prospectus delivery requirements of the Securities
      Act
      so that all transfer restrictions and restrictive legends with respect thereto
      are removed upon the consummation of such sale; (C) are held by a Holder or
      a
      permitted transferee of a Holder pursuant to Section 5.10; and (D) may not
      be
      disposed of under Rule 144(k) under the Securities Act without restriction.
      

     

    5.2 Required
      Registration .

     

    (a) As
      promptly as practicable after the Closing Date, but in no event later than
      thirty (30) days after the
      Closing Date, the Company agrees to file a Registration Statement to register
      the resale of all of the
      Shares.
      The
      Company shall use its reasonable best efforts to cause the SEC to declare
      the Registration Statement effective no later than one hundred twenty (120)
      days
      following the Closing
      Date (the "Registration
      Deadline"). In
      the
      event that the Registration Statement has not been filed on or prior to the
      Registration Deadline, then in addition
      to any other rights the Holders may have hereunder or under applicable law,
      for
      each thirty
      (30) day period (each, a "Liquidated
      Damages Period') following
      such Registration Deadline
      until the date on which the Registration Statement is first filed or is no
      longer required to be filed pursuant to this Agreement, the Company shall issue
      to each Holder, as liquidated damages and
      not
      as a penalty,
      warrants with a term of five (5) years and an exercise price of $2.00 per share
      to purchase shares of Common Stock equal to 2.5% of the number of shares of
      Common Stock purchased by such Holder. Once the Registration
      Statement has been declared effective, the Company shall thereafter maintain
      the
effectiveness
      of the Registration Statement until the earlier of: (i) such time as the Company
      reasonably determines, based on the advice of counsel, that each Holder, acting
      independently of all other Holders, will be eligible to sell under Rule 144
      promulgated under the Securities Act all of the Shares then
      owned by such Holder within the volume limitations imposed by Rule 144(e) in
      the
      three (3)
      month
      period immediately following the termination of the effectiveness of the
      Registration, or (ii) the date on which all of the Shares held by the Holders
      are eligible for sale pursuant to Rule 144(k) promulgated under the Securities
      Act. Notwithstanding anything herein to the contrary, to the extent that the
      registration of any or all of the Shares by the Company on the Registration
      Statement is prohibited (the “Non-Registered
      Shares”)
      under
      Rule 415 in the opinion of the Commission, the liquidated damages described
      in
      this Section 5.2(a) shall not be applicable to such Non-Registered Shares,
      in
      which case the Company will file additional Registration Statements (each,
      a
“Subsequent
      Registration Statement”)
      each
      registering the Non-Registered Shares until all of the Registrable Securities
      have been registered. The Filing Date and Effective Date of each such Subsequent
      Registration Statement shall be, respectively, fourteen (14) and forty-five
      (45)
      days after the first day such Subsequent Registration Statement may be filed
      without objection by the Commission under Rule 415. The Company’s failure to
      meet the Filing Date and Effective Date as they relate to the Subsequent
      Registration Statements shall subject it to all liquidated damage provisions
      set
      forth in this Section 5.2(a).

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

     

    (b) If
      the
      total amount of securities, including Registrable Securities, requested by
      stockholders to be included in a registration statement exceeds the amount
      of
      securities permitted to be sold under Rule 415 promulgated under the Securities
      Act (“Rule 415”), then the Company shall be required to include in the offering
      only that number of such securities, including Registrable Securities, which
      the
      Company in its sole discretion determines will be permitted to be registered
      without objection by the SEC under Rule 415 (the securities so included to
      be
      apportioned pro rata among the selling stockholders according to the total
      amount of securities entitled to be included therein owned by each selling
      stockholder or in such other proportions as shall mutually be agreed to by
      such
      selling stockholders).

     

    5.3 Registration
      Procedures.
      Whenever required under this Article V to include Registrable Securities in
      a
      Company registration statement, the Company shall, as expeditiously as
      reasonably possible:

     

    (a) Use
      best
      efforts to (i) cause such registration statement to become effective, and (ii)
      cause such registration statement to remain effective until the earliest to
      occur of (A) such date as the sellers of Registrable Securities (the “Selling
      Holders”) have completed the distribution described in the registration
      statement and (B) such time that all of such Registrable Securities are no
      longer, by reason of Rule 144(k) under the Securities Act, required to be
      registered for the sale thereof by such Holders. The Company will also use
      its
      best efforts to, during the period that such registration statement is required
      to be maintained hereunder, file such post-effective amendments and supplements
      thereto as may be required by the Securities Act and the rules and regulations
      thereunder or otherwise to ensure that the registration statement does not
      contain any untrue statement of material fact or omit to state a fact required
      to be stated therein or necessary to make the statements contained therein,
      in
      light of the circumstances under which they are made, not misleading; provided,
      however, that if applicable rules under the Securities Act governing the
      obligation to file a post-effective amendment permits, in lieu of filing a
      post-effective amendment that (i) includes any prospectus required by Section
      10(a)(3) of the Securities Act or (ii) reflects facts or events representing
      a
      material or fundamental change in the information set forth in the registration
      statement, the Company may incorporate by reference information required to
      be
      included in (i) and (ii) above to the extent such information is contained
      in
      periodic reports filed pursuant to Section 13 or 15(d) of the Exchange Act
      in
      the registration statement. 

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

     

    (b) Prepare
      and file with the SEC such amendments and supplements to such registration
      statement, and the prospectus used in connection with such registration
      statement, as may be necessary to comply with the provisions of the Securities
      Act with respect to the disposition of all securities covered by such
      registration statement.

     

    (c) Make
      available for inspection upon reasonable notice during the Company’s regular
      business hours by each Selling Holder, any underwriter participating in any
      distribution pursuant to such registration statement, and any attorney,
      accountant or other agent retained by such Selling Holder or underwriter, all
      financial and other records, pertinent corporate documents and properties of
      the
      Company, and cause the Company’s officers, directors and employees to supply all
      information reasonably requested by any such Selling Holder, underwriter,
      attorney, accountant or agent in connection with such registration
      statement.

     

    (d) Furnish
      to the Selling Holders such numbers of copies of a final prospectus, in
      conformity with the requirements of the Securities Act, and such other documents
      as they may reasonably request in order to facilitate the disposition of
      Registrable Securities owned by them.

     

    (e) Use
      best
      efforts to register and qualify the securities covered by such registration
      statement under such other federal or state securities laws of such
      jurisdictions as shall be reasonably requested by the Selling Holders; provided,
      however, that the Company shall not be required in connection therewith or
      as a
      condition thereto to qualify to do business or to file a general consent to
      service of process in any such states or jurisdictions, unless the Company
      is
      already subject to service in such jurisdiction and except as may be required
      by
      the Securities Act.

     

    (f) In
      the
      event of any underwritten public offering, enter into and perform its
      obligations under an underwriting agreement, in usual and customary form, with
      the managing underwriter of such offering. Each Selling Holder participating
      in
      such underwriting shall also enter into and perform its obligations under such
      an agreement.

     

    (g) Notify
      each Holder of Registrable Securities covered by such registration statement,
      at
      any time when a prospectus relating thereto is required to be delivered under
      the Securities Act, (i) when the registration statement or any post-effective
      amendment and supplement thereto has become effective; (ii) of the issuance
      by
      the SEC of any stop order or the initiation of proceedings for that purpose
      (in
      which event the Company shall make every effort to obtain the withdrawal of
      any
      order suspending effectiveness of the registration statement at the earliest
      possible time or prevent the entry thereof); (iii) of the receipt by the Company
      of any notification with respect to the suspension of the qualification of
      the
      Registrable Securities for sale in any jurisdiction or the initiation of any
      proceeding for such purpose; and (iv) of the happening of any event as a result
      of which the prospectus included in such registration statement, as then in
      effect, includes an untrue statement of a material fact or omits to state a
      material fact required to be stated therein or necessary to make the statements
      therein not misleading in the light of the circumstances then
      existing.

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

     

    (h) Cause
      all
      such Registrable Securities registered hereunder to be listed on each securities
      exchange or quotation service on which similar securities issued by the Company
      are then listed or quoted or, if no such similar securities are listed or quoted
      on a securities exchange or quotation service, apply for qualification and
      use
      best efforts to qualify such Registrable Securities for inclusion on the New
      York Stock Exchange, American Stock Exchange or listing on a quotation system
      of
      the National Association of Securities Dealers, Inc.

     

    (i) Cooperate
      with the Selling Holders and the managing underwriters, if any, to facilitate
      the timely preparation and delivery of certificates representing the Registrable
      Securities to be sold, which certificates will not bear any restrictive legends;
      and enable such Registrable Securities to be in such denominations and
      registered in such names as the managing underwriters, if any, shall request
      at
      least five business days prior to any sale of the Registrable Securities to
      the
      underwriters.

     

    (j) In
      connection with an underwritten offering, cause the officers of the Company
      to
      provide reasonable assistance in the preparation of, any “road show”
presentation to potential investors as the managing underwriter may determine.
      

     

    (k) Comply
      with all applicable rules and regulations of the SEC and make generally
      available to its security holders earning statements satisfying the provisions
      of Section 11(a) of the Securities Act and Rule 158 thereunder (or any similar
      rule promulgated under the Securities Act) no later than 50 calendar days after
      the end of any 3-month period (or 105 calendar days after the end of any
      12-month period if such period is a fiscal year) (i) commencing at the end
      of
      any fiscal quarter in which Registrable Securities are sold to underwriters
      in a
      firm commitment or best efforts underwritten offering, and (ii) if not sold
      to
      underwriters in such an offering, commencing on the first day of the first
      fiscal quarter of the Company, after the effective date of a registration
      statement, which statements shall cover said period.

     

    (l) If
      the
      offering is underwritten and at the request of any Selling Holder, use its
      best
      efforts to furnish on the date that Registrable Securities are delivered to
      the
      underwriters for sale pursuant to such registration: (i) opinions dated such
      date of counsel representing the Company for the purposes of such registration,
      addressed to the underwriters and the transfer agent for the Registrable
      Securities so delivered, respectively, to the effect that such registration
      statement has become effective under the Securities Act and such Registrable
      Securities are freely tradable, and covering such other matters as are
      customarily covered in opinions of issuer’s counsel delivered to underwriters
      and transfer agents in underwritten public offerings and (ii) a letter dated
      such date from the independent public accountants who have certified the
      financial statements of the Company included in the registration statement
      or
      the prospectus, covering such matters as are customarily covered in accountants’
letters delivered to underwriters in underwritten public offerings.

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

     

    5.4 Furnish
      Information.
      It
      shall be a condition precedent to the obligation of the Company to take any
      action pursuant to this Article V with respect to the Registrable Securities
      of
      any Selling Holder that such Holder shall furnish to the Company such
      information regarding the Holder, the Registrable Securities held by the Holder,
      and the intended method of disposition of such securities as shall be reasonably
      required by the Company to effect the registration of such Holder’s Registrable
      Securities.

     

    5.5 Registration
      Expenses.
      The
      Company shall bear and pay all registration expenses incurred in connection
      with
      any registration, filing or qualification of Registrable Securities with respect
      to registrations hereto for each Holder, but excluding underwriting discounts
      and commissions relating to Registrable Securities and excluding any
      professional fees or costs of accounting, financial or legal advisors to any
      of
      the Holders.

     

    5.6 Underwriting
      Requirements.
      In
      connection with any offering involving an underwriting of shares of the
      Company’s capital stock, the Company shall not be required to include any of the
      Holders’ Registrable Securities in such underwriting unless they accept the
      terms of the underwriting as agreed upon between the Company and the
      underwriters selected by it (or by other persons entitled to select the
      underwriters), and then only in such quantity as the underwriters determine
      in
      their sole discretion will not jeopardize the success of the offering by the
      Company. If the total amount of securities, including Registrable Securities,
      requested by stockholders to be included in such offering exceeds the amount
      of
      securities sold other than by the Company that the underwriters determine in
      their sole discretion is compatible with the success of the offering, then
      the
      Company shall be required to include in the offering only that number of such
      securities, including Registrable Securities, which the underwriters determine
      in their sole discretion will not jeopardize the success of the offering (the
      securities so included to be apportioned pro rata among the selling stockholders
      according to the total amount of securities entitled to be included therein
      owned by each selling stockholder or in such other proportions as shall mutually
      be agreed to by such selling stockholders). For purposes of the preceding
      parenthetical concerning apportionment, for any selling stockholder who is
      a
      holder of Registrable Securities and is a partnership or corporation, the
      partners, retired partners and stockholders of such holder, or the estates
      and
      family members of any such partners and retired partners and any trusts for
      the
      benefit of any of the foregoing persons shall be deemed to be a single “selling
      stockholder,” and any pro-rata reduction with respect to such “selling
      stockholder” shall be based upon the aggregate amount of shares carrying
      registration rights owned by all entities and individuals included in such
      “selling stockholder,” as defined in this sentence.

     

    5.7 Delay
      of Registration.
      No
      Holder shall have any right to obtain or seek an injunction restraining or
      otherwise delaying any such registration as the result of any controversy that
      might arise with respect to the interpretation or implementation of this
      Article. 

     

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

     

    5.8 Indemnification.
      In the
      event that any Registrable Securities are included in a registration statement
      under this Article V:

     

    (a) To
      the
      extent permitted by law, the Company will indemnify and hold harmless each
      Holder, any underwriter (as defined in the Securities Act) for such Holder
      and
      each person, if any, who controls such Holder or underwriter within the meaning
      of the Securities Act or the Exchange Act, against any losses, claims, damages,
      or liabilities (joint or several) to which they may become subject under the
      Securities Act, or the Exchange Act, insofar as such losses, claims, damages,
      or
      liabilities (or actions in respect thereof) arise out of or are based upon
      any
      of the following statements, omissions or violations (collectively a
“Violation”): (i) any untrue statement of a material fact contained in such
      registration statement, including any preliminary prospectus or final prospectus
      contained therein or any amendments or supplements thereto, (ii) the omission
      to
      state therein a material fact required to be stated therein, or necessary to
      make the statements therein not misleading, or (iii) any violation by the
      Company of the Securities Act, the Exchange Act, or any rule or regulation
      promulgated under the Securities Act, or the Exchange Act, and the Company
      will
      pay to each such Holder, underwriter or controlling person, as incurred, any
      legal or other expenses reasonably incurred by them in connection with
      investigating or defending any such loss, claim, damage, liability, or action;
      provided, however, that the indemnity agreement contained in this Section 5.8(a)
      shall not apply to amounts paid in settlement of any such loss, claim, damage,
      liability, or action if such settlement is effected without the consent of
      the
      Company (which consent shall not be unreasonably withheld), nor shall the
      Company be liable in any such case for any such loss, claim, damage, liability,
      or action to the extent that it arises out of or is based upon a Violation
      which
      occurs in reliance upon and in conformity with written information furnished
      expressly for use in connection with such registration by any such Holder,
      underwriter or controlling person.

     

    (b) To
      the
      extent permitted by law, each Selling Holder will indemnify and hold harmless
      the Company, each of its directors, each of its officers, each person, if any,
      who controls the Company within the meaning of the Securities Act, any
      underwriter, any other Holder selling securities in such registration statement
      and any controlling person of any such underwriter or other Holder, against
      any
      losses, claims, damages, or liabilities (joint or several) to which any of
      the
      foregoing persons may become subject, under the Securities Act, or the Exchange
      Act, insofar as such losses, claims, damages, or liabilities (or actions in
      respect thereto) arise out of or are based upon any Violation, in each case
      to
      the extent (and only to the extent) that such Violation occurs in reliance
      upon
      and in conformity with written information furnished by such Holder expressly
      for use in connection with such registration; and each such Holder will pay,
      as
      incurred, any legal or other expenses reasonably incurred by any person intended
      to be indemnified pursuant to this Section 5.8(b), in connection with
      investigating or defending any such loss, claim, damage, liability, or action;
      provided,
      however,
      that
      the indemnity agreement contained in this Section 5.8(b) shall not apply to
      amounts paid in settlement of any such loss, claim, damage, liability or action
      if such settlement is effected without the consent of the Holder, which consent
      shall not be unreasonably withheld; provided,
      further,
      that, in
      no event shall any indemnity under this Section 5.8(b) exceed the greater of
      the
      cash value of the (i) gross proceeds from the Offering received by such Holder
      or (ii) such Holder’s investment pursuant to this Agreement as set forth on the
      signature page attached hereto.

     

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

     

    (c) Promptly
      after receipt by an indemnified party under this Section 5.8 of notice of the
      commencement of any action (including any governmental action), such indemnified
      party shall, if a claim in respect thereof is to be made against any
      indemnifying party under this Section 5.8, deliver to the indemnifying party
      a
      written notice of the commencement thereof and the indemnifying party shall
      have
      the right to participate in, and, to the extent the indemnifying party so
      desires, jointly with any other indemnifying party similarly notified, to assume
      the defense thereof with counsel selected by the indemnifying party and approved
      by the indemnified party (whose approval shall not be unreasonably withheld);
      provided, however, that an indemnified party (together with all other
      indemnified parties which may be represented without conflict by one counsel)
      shall have the right to retain one separate counsel, with the fees and expenses
      to be paid by the indemnifying party, if representation of such indemnified
      party by the counsel retained by the indemnifying party would be inappropriate
      due to actual or potential differing interests between such indemnified party
      and any other party represented by such counsel in such proceeding. The failure
      to deliver written notice to the indemnifying party within a reasonable time
      of
      the commencement of any such action, if prejudicial to its ability to defend
      such action, shall relieve such indemnifying party of any liability to the
      indemnified party under this Section 5.8, but the omission so to deliver written
      notice to the indemnifying party will not relieve it of any liability that
      it
      may have to any indemnified party otherwise than under this Section
      5.8.

     

    (d) If
      the
      indemnification provided for in this Section 5.8 is held by a court of competent
      jurisdiction to be unavailable to an indemnified party with respect to any
      loss,
      liability, claim, damage, or expense referred to therein, then the indemnifying
      party, in lieu of indemnifying such indemnified party hereunder, shall
      contribute to the amount paid or payable by such indemnified party as a result
      of such loss, liability, claim, damage, or expense in such proportion as is
      appropriate to reflect the relative fault of the indemnifying party on the
      one
      hand and of the indemnified party on the other in connection with the statements
      or omissions that resulted in such loss, liability, claim, damage, or expense
      as
      well as any other relevant equitable considerations. The relative fault of
      the
      indemnifying party and of the indemnified party shall be determined by reference
      to, among other things, whether the untrue or alleged untrue statement of a
      material fact or the alleged omission to state a material fact relates to
      information supplied by the indemnifying party or by the indemnified party
      and
      the parties’ relative intent, knowledge, access to information, and opportSharey
      to correct or prevent such statement or omission.

     

    (e) Notwithstanding
      the foregoing, to the extent that the provisions on indemnification and
      contribution contained in an underwriting agreement entered into in connection
      with an underwritten public offering are in conflict with the foregoing
      provisions, the provisions in such underwriting agreement shall
      control.

     

    (f) The
      obligations of the Company and Holders under this Section 5.8 shall survive
      the
      completion or termination of the Offering.

     

    5.9 Reports
      Under Securities Exchange Act of 1934.
      With a
      view to making available to the Holders the benefits of Rule 144 and any other
      rule or regulation of the SEC that may at any time permit a Holder to sell
      securities of the Company to the public without registration or pursuant to
      a
      registration on Form S-3 (or other applicable form), the Company agrees
      to:

     

    (a) file
      with
      the SEC all reports and other documents required of the Company under the
      Securities Act and the Exchange Act; and

     

    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

    

     

    (b) furnish
      to any Holder, so long as the Holder owns any Registrable Securities, forthwith
      upon request (i) a copy of the most recent annual or quarterly report of the
      Company and such other reports and documents so filed by the Company, and (ii)
      such other information as may be reasonably requested in availing any Holder
      of
      any rule or regulation of the SEC which permits the selling of any such
      securities without registration or pursuant to such form.

     

    5.10 Permitted
      Transferees.
      The
      rights to cause the Company to register Registrable Securities granted to the
      Holders by the Company under this Article V may be assigned in full by a Holder
      in connection with a transfer by such Holder of its Registrable Securities
      if:
      (a) such Holder gives prior written notice to the Company; (b) such
      transferee agrees to comply with the terms and provisions of this Agreement;
      (c) such transfer is otherwise in compliance with this Agreement; and
      (d) such transfer is otherwise effected in accordance with applicable
      securities laws. Except as specifically permitted by this Section 5.10, the
      rights of a Holder with respect to Registrable Securities as set out herein
      shall not be transferable to any other Person, and any attempted transfer shall
      cause all rights of such Holder therein to be forfeited. 

     

    5.11 Termination
      of Registration Rights
      The
      right of any Holder to request inclusion in any registration pursuant to Section
      5.3 shall terminate if all shares of Registrable Securities held by such Holder
      may immediately be sold under Rule 144(k).

     

    
      	
              VI.

            	
              ADDITIONAL
                RIGHTS

            

    

     

    6.1 Right
      of First Refusal.
      Until
      270 days from the Closing Date, the Subscriber shall be given not less than
      ten
      (10) Business Days prior written notice of any proposed sale by the Company
      of
      its Common Stock or other equity securities, except in connection with (i)
      full
      or partial consideration in connection with a strategic merger, acquisition,
      consolidation or purchase of substantially all of the securities or assets
      of
      corporation or other entity which holders of such securities or debt are not
      at
      any time granted registration rights, (ii)
      the
      Company’s issuance of securities in connection with strategic license agreements
      and other partnering arrangements so long as such issuances are not for the
      purpose of raising capital and which
      holders of such securities or debt are not at any time granted registration
      rights,
      or
      (iii) the Company’s issuance of Common Stock or the issuances or grants of
      options to purchase Common Stock pursuant to stock option plans and employee
      stock purchase plans at prices equal to or higher than the closing price of
      the
      Common Stock on the issue date of any of the foregoing (each, an “Exempt
      Issuance”).
      The
      Subscriber who exercises its rights pursuant to this Section 6.1 shall have
      the
      right during the ten (10) Business Days following receipt of the notice to
      purchase such offered Common Stock, debt or other securities in accordance
      with
      the terms and conditions set forth in the notice of sale in the same proportion
      to purchase of Shares in this Offering. In the event such terms and conditions
      are modified during the notice period, the Subscriber shall be given prompt
      notice of such modification and shall have the right during the ten (10)
      Business Days following the notice of modification to exercise such right.
      With
      respect to the issuance of Shares in this Offering, prior written notice need
      not be given more than five business days prior to such issuance.

     

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

    

     

    6.2 Participation
      in Future Financing.

     

    (a) From
      the
      date hereof until the date that is the 9 month anniversary of the Closing Date,
      upon any issuance by the Company of Common Stock or Common Stock Equivalents for
      cash consideration (a “Subsequent
      Financing”),
      the
      Subscriber shall have the right to participate in up to an amount of the
      Subsequent Financing equal to 100% of the Subsequent Financing (the
“Participation
      Maximum”)
      on the
      same terms, conditions and price provided for in the Subsequent
      Financing. 

     

    (b) At
      least
      5 Trading Days prior to the closing of the Subsequent Financing, the Company
      shall deliver to each Subscriber in the Offering a written notice of its
      intention to effect a Subsequent Financing (“Pre-Notice”),
      which
      Pre-Notice shall ask such Purchaser if it wants to review the details of such
      financing (such additional notice, a “Subsequent
      Financing Notice”). 
      Upon the request of the Subscriber, and only upon a request by the Subscriber,
      for a Subsequent Financing Notice, the Company shall promptly, but no later
      than
      1 Trading Day after such request, deliver a Subsequent Financing Notice to
      such
      Purchaser.  The Subsequent Financing Notice shall describe in reasonable
      detail the proposed terms of such Subsequent Financing, the amount of proceeds
      intended to be raised thereunder, the Person or Persons through or with whom
      such Subsequent Financing is proposed to be effected, and attached to which
      shall be a term sheet or similar document relating
      thereto.   

     

    (c) Any
      Subscriber desiring to participate in such Subsequent Financing must provide
      written notice to the Company by not later than 5:30 p.m. (New York City time)
      on the 5th
      Trading
      Day after all of the Purchasers have received the Pre-Notice that the Purchaser
      is willing to participate in the Subsequent Financing, the amount of the
      Purchaser’s participation, and that the Subscriber has such funds ready,
      willing, and available for investment on the terms set forth in the Subsequent
      Financing Notice. If the Company receives no notice from a Subscriber as of
      such
      5th
      Trading
      Day, such Subscriber shall be deemed to have notified the Company that it does
      not elect to participate.  

     

    (d) If
      by
      5:30 p.m. (New York City time) on the 5th
      Trading
      Day after all of the Subscribers have received the Pre-Notice, notifications
      by
      the Subscribers of their willingness to participate in the Subsequent Financing
      (or to cause their designees to participate) is, in the aggregate, less than
      the
      total amount of the Subsequent Financing, each Subscribers shall be deemed
      to
      have notified the Company that it does not elect to participate and the Company
      may effect the Subsequent Financing on the terms and with the Subscribers set
      forth in the Subsequent Financing Notice.  

     

    (e) If
      by
      5:30 p.m. (New York City time) on the 5th
      Trading
      Day after all of the Subscribers have received the Pre-Notice, the Company
      receives responses to a Subsequent Financing Notice from Subscribers seeking
      to
      purchase more than the aggregate amount of the Participation Maximum, each
      such
      Subscriber shall have the right to purchase the greater of (a) their Pro Rata
      Portion (as defined below) of the Participation Maximum and (b) the difference
      between the Participation Maximum and the aggregate amount of participation
      by
      all other Purchasers.  “Pro
      Rata Portion”
is
      the
      ratio of (x) the Subscription Amount of Securities purchased on the Closing
      Date
      by a Purchaser participating under this Section 4.13 and (y) the sum of the
      aggregate Subscription Amounts of Securities purchased on the Closing Date
      by
      all Purchasers participating under this Section 4.13.

     

    
      
        
        

      

      
        16

        
          

        

      

      
        
        

      

    

     

    (f) The
      Company must provide the Subscribers with a second Subsequent Financing Notice,
      and the Subscribers will again have the right of participation set forth above
      in this Section 4.13, if the Subsequent Financing subject to the initial
      Subsequent Financing Notice is not consummated for any reason on the terms
      set
      forth in such Subsequent Financing Notice within 60 Trading Days after the
      date
      of the initial Subsequent Financing Notice.

     

    (g) Notwithstanding
      the foregoing, this Section 6.2 shall not apply in respect of an underwritten
      public offering of Common Stock. In addition, with
      respect to the issuance of Shares in this Offering, prior written notice need
      not be given more than five business days prior to such issuance.

    

    
      	
              VII.

            	
              MISCELLANEOUS

            

    

     

    7.1 Any
      notice or other communication given hereunder shall be deemed sufficient if
      in
      writing and sent by registered or certified mail, return receipt requested,
      or
      delivered by hand against written receipt therefor, addressed as
      follows:

     

    if
      to the
      Company, to:

     

    Patient
      Safety Technologies, Inc.

    c/o
      William B. Horne

    1800
      Century Park East

    Suite
      200

    Los
      Angeles, CA 90067

     

    With
      a
      copy to (which shall not constitute notice):

    

    Sichenzia
      Ross Friedman Ference LLP

    1065
      Avenue of the Americas

    New
      York,
      NY 10018

    Attn:
      Marc Ross, Esq.

    

    if
      to the
      Subscriber, to the Subscriber’s address indicated on the signature page of this
      Agreement.

     

    Notices
      shall be deemed to have been given or delivered on the date of mailing, except
      notices of change of address, which shall be deemed to have been given or
      delivered when received.

     

    
      
        
        

      

      
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    7.2 Except
      as
      otherwise provided herein, this Agreement shall not be changed, modified or
      amended except by a writing signed by the parties to be charged, and this
      Agreement may not be discharged except by performance in accordance with its
      terms or by a writing signed by the party to be charged.

     

    7.3 Subject
      to the provisions of Section 5.11, this Agreement shall be binding upon and
      inure to the benefit of the parties hereto and to their respective heirs, legal
      representatives, successors and assigns. This Agreement sets forth the entire
      agreement and understanding between the parties as to the subject matter hereof
      and merges and supersedes all prior discussions, agreements and understandings
      of any and every nature among them.

     

    7.4 Upon
      the
      execution and delivery of this Agreement by the Subscriber, this Agreement
      shall
      become a binding obligation of the Subscriber with respect to the purchase
      of
      Shares as herein provided, subject, however, to the right hereby reserved by
      the
      Company to enter into the same agreements with other subscribers and to add
      and/or delete other persons as subscribers. 

     

    7.5 NOTWITHSTANDING
      THE PLACE WHERE THIS AGREEMENT MAY BE EXECUTED BY ANY OF THE PARTIES HERETO,
      THE
      PARTIES EXPRESSLY AGREE THAT ALL THE TERMS AND PROVISIONS HEREOF SHALL BE
      CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF CALIFORNIA
      WITHOUT REGARD TO SUCH STATE’S PRINCIPLES OF CONFLICTS OF LAW. IN THE EVENT THAT
      A JUDICIAL PROCEEDING IS NECESSARY, THE SOLE FORUM FOR RESOLVING DISPUTES
      ARISING OUT OF OR RELATING TO THIS AGREEMENT IS THE COURTS STATE OF CALIFORNIA
      IN AND FOR THE COUNTY OF LOS ANGELES OR THE FEDERAL COURTS FOR SUCH STATE AND
      COUNTY, AND ALL RELATED APPELLATE COURTS, THE PARTIES HEREBY IRREVOCABLY CONSENT
      TO THE JURISDICTION OF SUCH COURTS AND AGREE TO SAID VENUE. 

     

    7.6 In
      order
      to discourage frivolous claims the parties agree that unless a claimant in
      any
      proceeding arising out of this Agreement succeeds in establishing his claim
      and
      recovering a judgment against another party (regardless of whether such claimant
      succeeds against one of the other parties to the action), then the other party
      shall be entitled to recover from such claimant all of its/their reasonable
      legal costs and expenses relating to such proceeding and/or incurred in
      preparation therefor.

     

    7.7 The
      holding of any provision of this Agreement to be invalid or unenforceable by
      a
      court of competent jurisdiction shall not affect any other provision of this
      Agreement, which shall remain in full force and effect. If any provision of
      this
      Agreement shall be declared by a court of competent jurisdiction to be invalid,
      illegal or incapable of being enforced in whole or in part, such provision
      shall
      be interpreted so as to remain enforceable to the maximum extent permissible
      consistent with applicable law and the remaining conditions and provisions
      or
      portions thereof shall nevertheless remain in full force and effect and
      enforceable to the extent they are valid, legal and enforceable, and no
      provisions shall be deemed dependent upon any other covenant or provision unless
      so expressed herein.

     

    
      
        
        

      

      
        18

        
          

        

      

      
        
        

      

    

     

    7.8 It
      is
      agreed that a waiver by either party of a breach of any provision of this
      Agreement shall not operate, or be construed, as a waiver of any subsequent
      breach by that same party.

     

    7.9 The
      parties agree to execute and deliver all such further documents, agreements
      and
      instruments and take such other and further action as may be necessary or
      appropriate to carry out the purposes and intent of this Agreement.

     

    7.10 This
      Agreement may be executed in two or more counterparts each of which shall be
      deemed an original, but all of which shall together constitute one and the
      same
      instrument.

     

    7.11 Nothing
      in this Agreement shall create or be deemed to create any rights in any person
      or entity not a party to this Agreement, except for the holders of Registrable
      Securities.

     

    [REMAINDER
      OF PAGE INTENTIONALLY LEFT BLANK]

     

    
      
        
        

      

      
        19

        
          

        

      

      
        
        

      

    

     

    
      	
              VIII.

            	CONFIDENTIAL INVESTOR
              QUESTIONNAIRE

    

     

    8.1 The
      Subscriber represents and warrants that he, she or it comes within one category
      marked below, and that for any category marked, he, she or it has truthfully
      set
      forth, where applicable, the factual basis or reason the Subscriber comes within
      that category. ALL INFORMATION IN RESPONSE TO THIS SECTION WILL BE KEPT STRICTLY
      CONFIDENTIAL. The undersigned agrees to furnish any additional information
      which
      the Company deems necessary in order to verify the answers set forth
      below.

     

    
      	
              Category
                A  ___

            	 	
              The
                undersigned is an individual (not a partnership, corporation, etc.)
                whose
                individual net worth, or joint net worth with his or her spouse,
                presently
                exceeds $1,000,000.

            
	 	 	 
	 	 	
              Explanation.
                In calculating net worth you may include equity in personal property
                and
                real estate, including your principal residence, cash, short-term
                investments, stock and securities. Equity in personal property and
                real
                estate should be based on the fair market value of such property
                less debt
                secured by such property.

            
	 	 	 
	
              Category
                B  ___

            	 	
              The
                undersigned is an individual (not a partnership, corporation, etc.)
                who
                had an income in excess of $200,000 in each of the two most recent
                years,
                or joint income with his or her spouse in excess of $300,000 in each
                of
                those years (in each case including foreign income, tax exempt income
                and
                full amount of capital gains and losses but excluding any income
                of other
                family members and any unrealized capital appreciation) and has a
                reasonable expectation of reaching the same income level in the current
                year.

            
	 	 	 
	
              Category
                C  ___

            	 	
              The
                undersigned is a director or executive officer of the Company which
                is
                issuing and selling the Shares.

            
	 	 	 
	
              Category
                D  ___

            	 	
              The
                undersigned is a bank; a savings and loan association; insurance
                company;
                registered investment company; registered business development company;
                licensed small business investment company (“SBIC”); or employee benefit
                plan within the meaning of Title 1 of ERISA and (a) the investment
                decision is made by a plan fiduciary which is either a bank, savings
                and
                loan association, insurance company or registered investment advisor,
                or
                (b) the plan has total assets in excess of $5,000,000 or (c) is a
                self
                directed plan with investment decisions made solely by persons that
                are
                accredited investors. (describe entity)

            
	 	 	 
	 	 	 
	 	 	 
	
              Category
                E  ___

            	 	
              The
                undersigned is a private business development company as defined
                in
                section 202(a)(22) of the Investment Advisors Act of 1940. (describe
                entity) 

            
	 	 	 
	 	 	 

    

     

    
      
        
        

      

      
        20

        
          

        

      

      
        
        

      

    

     

    
      	
              Category
                F  ___

            	 	
              The
                undersigned is either a corporation, partnership, Massachusetts business
                trust, or non-profit organization within the meaning of Section 501(c)(3)
                of the Internal Revenue Code, in each case not formed for the specific
                purpose of acquiring the Shares and with total assets in excess of
                $5,000,000. (describe entity)

            
	 	 	 
	 	 	 
	 	 	 
	
              Category
                G  ___

            	 	
              The
                undersigned is a trust with total assets in excess of $5,000,000,
                not
                formed for the specific purpose of acquiring the Shares, where the
                purchase is directed by a “sophisticated investor” as defined in
                Regulation 506(b)(2)(ii) under the Act.

            
	 	 	 
	
              Category
                H  ___

            	 	
              The
                undersigned is an entity (other than a trust) in which all of the
                equity
                owners are “accredited investors” within one or more of the above
                categories. If relying upon this Category alone, each equity owner
                must
                complete a separate copy of this Agreement. (describe
                entity)

            
	 	 	 
	 	 	 
	 	 	 
	
              Category
                I  ___

            	 	
              The
                undersigned is not within any of the categories above and is therefore
                not
                an accredited investor.

            
	 	 	 
	 	 	
              The
                undersigned agrees that the undersigned will notify the Company at
                any
                time on or prior to the closing in the event that the representations
                and
                warranties in this Agreement shall cease to be true, accurate and
                complete.

            

    

     

    8.2 SUITABILITY
      (please
      answer each question)

     

    (a) For
      an
      individual Subscriber, please describe your current employment, including the
      company by which you are employed and its principal business:

     

      
        

      

      
        

      

      
        

        
   

    

    (b) For
      an
      individual Subscriber, please describe any college or graduate degrees held
      by
      you:

     

    
      

      

      

      

    

     

    (c) For
      all
      Subscribers, please list types of prior investments:

     

    
      

      

      

      
    

    
      
        
        

      

      
        21

        
          

        

      

      
        
        

      

    

     

    (d) For
      all
      Subscribers, please state whether you have participated in other private
      placements
      before:

     

    YES
      _______   NO
      _______

     

    (e) If
      your
      answer to question (d) above was “YES”, please indicate frequency of such prior
      participation in private
      placements
      of:

     

    
      	 	 	
               

              Public

              Companies

            	
               

            	
               

              Private

              Companies

            	
               

            	
              Public
                or Private Companies

              with
                no, or insignificant, 

              assets
                and operations

            	 
	
              Frequently

            	 	 	 	 	 	 	 	 	 	 
	
              Occasionally

            	 	 	 	 	 	 	 	 	 	 
	
              Never

            	 	 	 	 	 	 	 	 	 	 

    

    

    (f) For
      individual Subscribers, do you expect your current level of income to
      significantly decrease in the foreseeable future:

     

    YES
      _______   NO
      _______

     

    (g) For
      trust, corporate, partnership and other institutional Subscribers, do you expect
      your total assets to significantly decrease in the foreseeable future:

     

    YES
      _______   NO
      _______

     

    (h) For
      all
      Subscribers, do you have any other investments or contingent liabilities which
      you reasonably anticipate could cause you to need sudden cash requirements
      in
      excess of cash readily available to you: 

     

    YES
      _______   NO
      _______

     

    (i) For
      all
      Subscribers, are you familiar with the risk aspects and the non-liquidity of
      investments such as the securities for which you seek to subscribe?

     

    YES
      _______   NO
      _______

     

    (j) 
      For all
      Subscribers, do you understand that there is no guarantee of financial return
      on
      this investment and that you run the risk of losing your entire
      investment?

     

    YES
      _______   NO
      _______

     

    8.3 MANNER
      IN WHICH TITLE IS TO BE HELD.
      (circle
      one)

     

    (a) Individual
      Ownership

     

    (b) Community
      Property

     

    (c) Joint
      Tenant with Right of Survivorship
      (both parties must
      sign)

     

    (d) Partnership*

     

    (e) Tenants
      in Common

     

    
      
        
        

      

      
        22

        
          

        

      

      
        
        

      

       

    

    (f) Company*

     

    (g) Trust*

     

    (h) Other*

     

    *If
      Securities are being subscribed for by an entity, the attached Certificate
      of
      Signatory must also be completed.

     

    8.4 NASD
      AFFILIATION.

     

    Are
      you
      affiliated or associated with an NASD member firm (please check
      one):

     

    Yes
      _________  No
      __________

     

    If
      Yes,
      please describe:

     

    
      

    

    
      

      

    

     

    *If
      Subscriber is a Registered Representative with an NASD member firm, have the
      following acknowledgment signed by the appropriate party:

     

    The
      undersigned NASD member firm acknowledges receipt of the notice required by
      Article 3, Sections 28(a) and (b) of the Rules of Fair Practice.

     

    _________________________________

    Name
      of
      NASD Member Firm

    
      	 	 	 	 
	 	 	 	 
	By:
	 	 	
            
	
              
                

              

              Authorized
                Officer

            	 	 	
            
	 	 	 	 
	Date: 	 	 	 
	
              
                
 

            	 	 	 

    

     

    8.5 The
      undersigned is informed of the significance to the Company of the foregoing
      representations and answers contained in the Confidential Investor Questionnaire
      contained in this Article VII and such answers have been provided under the
      assumption that the Company will rely on them.

     

    [REMAINDER
      OF PAGE INTENTIONALLY LEFT BLANK]

     

    
      
        
        

      

      
        23

        
          

        

      

      
        
        

      

    

    NUMBER
      OF SHARES _________ X $1.25 = $_________ (the “Purchase
      Price”) 

    

    
      	  
	 	
               
                

            
	
              Signature

            	 	
              Signature
                (if purchasing jointly)

            
	  
	 	
               
                

            
	
              Name
                Typed or Printed

            	 	
              Name
                Typed or Printed

            
	  
	 	
               
                

            
	
              Title
                (if Subscriber is an Entity)

            	 	
              Title
                (if Subscriber is an Entity)

            
	  
	 	
               
                

            
	
              Entity
                Name (if applicable)

            	 	
              Entity
                Name (if applicable

            
	  
	 	  

	  
	 	  

	
              Address

            	 	
              Address

            
	  
	 	
               
                

            
	
              City,
                State and Zip Code

            	 	
              City,
                State and Zip Code

            
	  
	 	
               
                

            
	
              Telephone-Business

            	 	
              Telephone-Business

            
	  
	 	
               
                

            
	
              Telephone-Residence

            	 	
              Telephone-Residence

            
	  
	 	
               
                

            
	
              Facsimile-Business

            	 	
              Facsimile-Business

            
	  
	 	
               
                

            
	
              Facsimile-Residence

            	 	
              Facsimile-Residence

            
	  
	 	
               
                

            
	
              Tax
                ID # or Social Security # 

            	 	
              Tax
                ID # or Social Security # 

            
	 	 	 
	
              Name
                in which securities should be issued:

            	 	  

    

     

    Dated:
      ________________ ,
      2007

    

    This
      Subscription Agreement is agreed to and accepted as of ________________,
      2007.

    
      	 	 	 
	 	PATIENT
              SAFETY
              TECHNOLOGIES, INC.
	 
 	 
 	 
 
	
            	By:  	
            
	 	
              
Name:
              William B. Horne 
	 	
              Title: Chief
                Executive Officer

            

    

     

    
      
        
        

      

      
        24

        
          

        

      

      
        
        

      

    

    CERTIFICATE
      OF SIGNATORY

    

    (To
      be
      completed if Shares are

    being
      subscribed for by an entity)

    

    I,
      ____________________________, am the ____________________________ of
      __________________________________________ (the “Entity”).

    

    I
      certify
      that I am empowered and duly authorized by the Entity to execute and carry
      out
      the terms of the Subscription Agreement and to purchase and hold the Shares,
      and
      certify further that the Subscription Agreement has been duly and validly
      executed on behalf of the Entity and constitutes a legal and binding obligation
      of the Entity.

    

    IN
      WITNESS WHEREOF, I have set my hand this ________ day of _________________,
      2007

    
      	 	 	 	 
	
            	 	 	
            
	
            	 	 	
              
(Signature)

    
      
        
        

      

      
        25

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