Document:

EX-10.1

                     EXCLUSIVE LICENSE AND SUPPLY AGREEMENT
                                  BY AND AMONG
              SURGICOUNT MEDICAL, INC. A CALIFORNIA CORPORATION AND
               A PLUS INTERNATIONAL, INC. A CALIFORNIA CORPORATION

                                      DATED
                                JANUARY 26, 2007

         This Exclusive  License and Supply  Agreement  ("Agreement") is entered
into this day by and between SurgiCount Medical,  Inc., a California corporation
with an office  located  at 27555 Ynez Road,  Suite  330,  Temecula,  California
92591, ("SurgiCount"),  and A Plus International, Inc., a California corporation
with  an  office  located  at 5138 Eucalyptus  Avenue,  Chino,  California 91710
("A Plus").

         WHEREAS  SurgiCount  is the Owner of all right  title and  interest  in
United  States  Patent No.  5,031,824  and European  Patent  1032911  ("Licensed
Patent");

         WHEREAS  SurgiCount  plans to continue to market,  distribute  and sell
gauze sponges,  laparotomy sponges,  O.R. towels,  specialty sponges,  and gowns
which utilize machine-readable  information to identify and account for the item
("Product") to its customers world-wide;

         WHEREAS  SurgiCount  does not  have the  capacity  to  manufacture  its
Product;

         WHEREAS pursuant to the Supply Agreement dated August 10, 2005 ("Supply
Agreement"),  A Plus has previously been engaged in the business of manufacturer
of the Product to be marketed, distributed, and sold world-wide by SurgiCount;

         WHEREAS  A  Plus  desires  to  obtain   exclusive   license  rights  to
manufacture said Product; and

         WHEREAS  to  induce  A Plus  to  commit  the  resources,  forego  other
potential   opportunities,   and  incur  the  expenses   necessary  to  properly
manufacture  and distribute the Product,  SurgiCount  desires to grant A Plus an
exclusive license to manufacture the Product.

         NOW THEREFORE IT IS HEREBY AGREED AS FOLLOWS:

SECTION 1.        GRANT OF  LICENSE.  Upon the  terms and  conditions  set forth
herein and under the  Licensed  Patent  during the term of this  Agreement,  and
absent a material breach of this Agreement by A Plus,  SurgiCount  hereby grants
to A Plus the  exclusive,  world-wide  License  to  manufacture  and  import the
Product  produced under the Licensed Patent. A Plus is further granted the right
to  sublicense  the  Licensed  Patent to the extent  necessary to carry out this
grant.

SECTION 2.        SUPPLY OF PRODUCT;  EXCLUSIVITY  AND SOLE  SOURCE.  During the
term of this Agreement, SurgiCount shall purchase exclusively from A Plus, and A
Plus shall use its best  efforts to supply to  SurgiCount,  all of  SurgiCount's
requirements for the Product. A Plus shall not manufacture, import

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or otherwise provide the Product for any party other than SurgiCount.  If A Plus
fails to (i) provide  SurgiCount with all its required supply of Product ordered
pursuant to this Agreement or (ii) meet any mutually pre-determined criteria for
pricing  thresholds,  quality  standards  or service  levels,  and such  failure
continues for more than thirty (30) days after written notice from SurgiCount to
A Plus  specifying  the nature of the failure,  then such  failure  shall not be
considered a breach of this  Agreement  but will entitle  SurgiCount to purchase
Product  from an  alternative  manufacturer.  SurgiCount  shall be  entitled  to
purchase Product from an alternative  manufacturer  until such time as A Plus is
able to cure the  nature  of the  failure,  to the  reasonable  satisfaction  of
SurgiCount.

SECTION 3.        DEMAND PROJECTIONS / PRICE PROJECTIONS. Upon the execution of,
and on each anniversary date of, this Agreement, SurgiCount shall provide A Plus
with projections of the maximum/minimum  levels of inventory of Product required
by SurgiCount for the upcoming twelve (12) month period.  Such projections shall
be forecasted on a quarterly  basis.  SurgiCount  shall be obligated to purchase
the minimum level of inventory projected by SurgiCount on an annual basis before
the end of such twelve-month  period,  and A Plus shall be obligated to maintain
sufficient  inventory  of  Product  on hand at all times to satisfy at least the
next sixty (60) days of SurgiCount's  minimum Product  projections.  The pricing
schedule of the Product for SurgiCount shall remain at its current price for the
first three (3) years of this agreement, thereafter said price schedule shall be
based upon the Cotlook Index and the RMB exchange rate, all as more specifically
set forth in Exhibit A attached hereto.

SECTION 4.        SHIPMENT OF GOODS; TITLE AND RISK OF LOSS;  DEFECTIVE PRODUCT.
A Plus  shall ship the  Product  to  SurgiCount  on such  schedules  and to such
destinations as requested by SurgiCount,  at A Plus's sole cost and expense, FOB
Chino,  California.  Legal  title  and  risk of loss  with  respect  to  Product
furnished by A Plus  hereunder  shall pass to  SurgiCount  upon  delivery of the
Product by A Plus to Chino, California.

SECTION 5.        INVOICE.  A Plus shall  invoice  SurgiCount  for Product  upon
delivery of Product  according to the  purchase  orders of  SurgiCount.  Payment
terms for  SurgiCount  are net 30 days from delivery of Product to SurgiCount or
its customer or date of the invoice to SurgiCount;  whichever is later.  Payment
shall be in United States Dollars and made in immediately available funds.

SECTION 6.        TERM AND TERMINATION.

                  (a)      The Term of this  Agreement  shall be eight (8) years
from the date it is executed by both  parties  (the  "Term").  Either  party may
terminate this Agreement  without cause at any time after expiration of the Term
upon delivery of ninety (90) days prior written  notice.  If either party shall,
at any time during the Term of this Agreement,  materially breach any obligation
hereunder  and such  breach  shall not be cured  within  thirty  (30) days after
written notice from the non-breaching party specifying the nature of the breach,
the non-breaching party may terminate this Agreement immediately upon expiration
of such cure period.

                  (b)      Should  SurgiCount  terminate this Agreement  without
cause prior to the expiration of the Term, or if it materially defaults upon any
obligation  set forth  herein and  remains in default for thirty (30) days after
written notice from A Plus, including but not limited to

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SurgiCount's failure to timely make any payments to A Plus required herein, then
A Plus may,  in  addition  to all other  remedies  it may have at either  law or
equity,  take either of the  following  remedial  actions,  at the election of A
Plus:

                      (1)  Require  SurgiCount  to purchase  all Product that is
                           (i) in A Plus's  inventory  or the  inventory of an A
                           Plus supplier on the date of  termination or default,
                           (ii) in transit to or from an A Plus  facility on the
                           date of termination or default, (iii) work in process
                           at A  Plus  or an A Plus  supplier  on  the  date  of
                           termination  or  default,  or (iv) on order from an A
                           Plus supplier on the date of  termination  or default
                           (collectively, the "Current A Plus Inventory"); or

                      (2)  A Plus  may  sell the A Plus  Inventory  directly  to
                           SurgiCount's customers.

SECTION 7.        NOTICES. Any notice required to be given hereunder shall be in
writing  (other  than  Purchase  Orders or unless  specifically  provided to the
contrary in this  Agreement),  addressed to each party at the last known address
of its  principal  place of  business,  which at the time of  execution  of this
Agreement is as follows:

         To SurgiCount:      SurgiCount Medical, Inc.
                             27555 Ynez Road, Suite 330
                             Temecula, California 92591
                             Attn: Rick Bertran, President

         To A Plus:          A Plus International Inc.
                             5138 Eucalyptus Avenue
                             Chino, California 91710
                             Attn: David Lee, Executive Vice President

Notices  shall be deemed given when  personally  delivered  or mailed  certified
mail,  postage  prepaid,  return  receipt  requested,  or consigned to a private
overnight  delivery service. A party may change its address to which notices are
to be sent by  written  notice  to A Plus,  and such  changed  address  shall be
effective ten (10) days after the giving of notice thereof.

SECTION 8.        TIME  OF  THE  ESSENCE.   Time  is  of  the  essence  for  the
performance of all the obligations of the parties under this Agreement.

SECTION 9.        HEADINGS; ENTIRE AGREEMENT. The headings of this Agreement are
provided for convenience of reference only, and are not an integral part of this
Agreement  and  shall  not  affect  its  construction  or  interpretation.  This
Agreement  embodies the entire agreement and understanding of the parties hereto
with  respect  to  the  subject  matter  hereof,  and  supersedes  all  previous
understandings,  agreements, negotiations, commitments, or any other writings or
communications with respect to such matter,  including the Supply Agreement.  If
any terms of any purchase order conflict with any term of this  Agreement,  this
Agreement shall control. This Agreement may only be amended by written agreement
of the parties.

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SECTION 10.       APPLICABLE LAW. This Agreement is made under,  governed by and
shall be interpreted  solely under the laws of the State of California,  without
regard to any choice of law provisions of the State of California.

SECTION 11.       ASSIGNMENT,  SUCCESSORS, AND NO THIRD-PARTY RIGHTS. The rights
and obligations of the parties under this Agreement shall benefit and be binding
upon the successors  and assigns of each party,  including any entity with which
said party may merge or consolidate or to which all or substantially  all of its
assets may be  transferred.  Nothing  expressed or referred to in this Agreement
will be construed  to give any person  other than the parties to this  Agreement
any legal or  equitable  right,  remedy,  or claim under or with respect to this
Agreement or any  provision of this  Agreement.  This  Agreement  and all of its
provisions and conditions are for the sole and exclusive  benefit of the parties
to this Agreement and their successors and permitted assigns.

SECTION 12.       RELATIONSHIP  OF THE  PARTIES.  A Plus is only an  independent
contractor and supplier to SurgiCount.  This Agreement does not in any manner or
for any purpose create a partnership,  joint venture, or employment relationship
between the parties hereto.

SECTION 13.       INDEMNIFICATION.

         (a)      BY SURGICOUNT.  SurgiCount agrees to indemnify,  defend,  save
and hold harmless A Plus from and against all losses,  suits and claims that may
(i) arise due to SurgiCount's  breach of this Agreement or (ii) arising from any
claim of patent  infringement upon the manufacture,  use or sale of the Product.
In such  event,  and in  addition  to payment of all  losses,  suits and claims,
SurgiCount,  at its own cost and expense,  shall pay all  reasonable  charges of
attorneys and all other costs and other expenses  arising  therefrom or incurred
by A Plus in connection therewith.

         (b)      BY A PLUS. A Plus agrees to indemnify,  defend,  save and hold
harmless SurgiCount from and against all losses, suits and claims (i) that arise
due to A Plus's  breach of this  Agreement or (ii) arising from A Plus's  direct
acts, errors or omissions in manufacturing the Product. Any indemnity obligation
set forth herein shall not include A Plus'  indemnity of SurgiCount  for losses,
suits or claims  arising from any claim  related to component  parts used in the
Product.  In such event,  and in  addition  to payment of all losses,  suits and
claims, A Plus, at its own cost and expense, shall pay all reasonable charges of
attorneys and all other costs and other expenses  arising  therefrom or incurred
by SurgiCount in connection therewith.

         (c)      INDEMNIFICATION  PROCEDURES.  As promptly as practicable after
any  indemnitee  referred to in Section 13(a) or 13(b) obtains  knowledge of any
action,  suit,  claim  or  demand  as to  which  it will or may be  entitled  to
indemnity under Section 13(a) or 13(b), such indemnitee shall give notice to the
indemnifying  party. The indemnifying  party shall be entitled to assume control
of the defense or settlement of such action,  suit,  claim or demand,  provided,
however, that (i) the indemnitee shall be entitled to participate in the defense
of such matter and to employ  counsel of its own choosing and at its own expense
to assist in the handling of such matter,  and (ii) the indemnifying party shall
obtain the prior written approval of the indemnitee, which approval shall not be
unreasonably  withheld or delayed,  before  entering into any settlement of such

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matter or ceasing to defend against such matter.

SECTION 14.       CONFIDENTIAL INFORMATION.

         (a)      In order to assist  each of the parties  hereto in  performing
their  respective  obligations  set  forth  herein  the  parties  will  exchange
financial  and other  information.  The  parties  acknowledge  that some of this
information may consist of Confidential Information.  As used in this Agreement,
the term "Confidential  Information"  shall mean (i) proprietary  information of
any of the parties;  (ii) information marked or designated by any of the parties
as confidential;  (iii) information,  whether or not in written form and whether
or not designated as confidential, which is known to a party as being treated by
as confidential by the other party; and (iv)  information  provided to any party
by third parties which a party is obligated to keep  confidential.  Confidential
Information  includes,  but is not  limited  to,  discoveries,  ideas,  designs,
specifications,  drawings,  techniques,  models, data, programs,  documentation,
manufacturing  processes  both  automated and direct labor,  know-how,  customer
lists, marketing plans, financial, and technical information.

         (b)      SurgiCount  hereby  acknowledges  that  A  Plus'  Confidential
Information  is and  shall  continue  to be the  exclusive  property  of A Plus,
whether or not disclosed or entrusted to SurgiCount pursuant to this Agreement.

         (c)      SurgiCount   acknowledges  that  any  disclosure  of  A  Plus'
Confidential  Information  to any third party will cause  irreparable  harm to A
Plus. SurgiCount agrees not to disclose any Confidential  Information of A Plus,
directly or indirectly,  under any  circumstances  or by any means, to any third
person without the express written consent of A Plus.  SurgiCount further agrees
that it will  not  copy,  transmit,  reproduce,  summarize,  quote,  or make any
commercial or other use  whatsoever of any  Confidential  Information  of A Plus
without the express written consent of A Plus. SurgiCount agrees to exercise the
highest degree of care in safeguarding  the  Confidential  Information of A Plus
against loss,  theft, or other inadvertent  disclosure,  and agrees generally to
take  all  steps  necessary  to  ensure  the  maintenance  of   confidentiality.
Confidential  Information may be disclosed or revealed to employees or agents of
SurgiCount where such employees or agents are required to keep  confidential the
Confidential Information under similar obligations or confidentiality.

SECTION 15.       ADDITIONAL  SURGICOUNT  OBLIGATIONS.  SurgiCount shall provide
appropriate scanners,  software and other hardware to A Plus to proceed with the
manufacturing   process,   together  with  all  data  matrix  and  master  tags.
Additionally,  SurgiCount  shall  on each  anniversary  date  of this  agreement
provide a validation report to A Plus and assist in the validation process.

         IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed this 26th day of January, 2007.

                         [SIGNATURES ON FOLLOWING PAGE]

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"A PLUS"                          A Plus International, Inc. a California
                                  corporation

                              By:
                                  -------------------------------------------
                                  David Lee, its Executive Vice President

 "SURGICOUNT"                     SurgiCount Medical, Inc. a California
                                  corporation

                              By:
                                  -------------------------------------------
                                  William  Horne,  its  Director  and  CEO of
                                  Patient Safety Technologies, Inc., its sole
                                  shareholder

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                                  EXHIBIT A TO

                     EXCLUSIVE LICENSE AND SUPPLY AGREEMENT
                                  BY AND AMONG
              SURGICOUNT MEDICAL, INC. A CALIFORNIA CORPORATION AND
               A PLUS INTERNATIONAL, INC. A CALIFORNIA CORPORATION

                                      DATED
                                JANUARY 26, 2007

         After the third  (3rd)  anniversary  of this  Agreement,  the price for
Product  shall  be  subject  to  adjustment  from  time to time  based  upon the
occurrence of any of the following:

         a.       CHANGE IN COST OF COTTON. The current price for cotton per the
CotLook 'A' Index (C/F Far East) ("CotLook Index") is 58.90 cents USD per pound.
If the price of cotton as  published in the CotLook  Index  changes to $0.70 USD
per pound or more and sustains that change for 90 days, the price of the Product
shall be adjusted by the corresponding  change in the cost of cotton used in the
Product.  If the price of cotton published in the CotLook Index changes to $0.50
USD per pound or less and  sustains  that  change for 90 days,  the price of the
Product shall be adjusted by the corresponding change in the cost of cotton used
in the Product. Such adjustment shall be based upon the 90 day average price set
forth in the CotLook  Index for the 90 days  immediately  prior to the Notice of
Adjustment.

         b.       CHANGE IN EXCHANGE  RATE.  The current  exchange  rate for the
Industrial  &  Commercial  Bank of  China  RMB  Spot  Rate to the US  dollar  is
777.35RMB to 100USD. The price of the Product shall be adjusted each January 2nd
and July 1st during the term of this agreement and any extension thereof, by the
corresponding change in the exchange rate for RMB to USD.

         c.       CHANGE IN PRICE OF DATA MATRIX TAGS. Until the data matrix tag
becomes a vendor supplied component from SurgiCount directly,  any change in the
cost of the data matrix tag from  Technographics  will be reflected in the final
cost of the sponge from A Plus.

         d.       NOTICE OF  ADJUSTMENTS.  Whenever  the price shall be adjusted
pursuant to the provisions set forth above, the party calling for the adjustment
shall within thirty (30) days of such adjustment  deliver a Notice of Adjustment
setting forth, in reasonable  detail,  the event  requiring the adjustment,  the
amount of the  adjustment,  the new price of the Product  after giving effect to
such  adjustment,  the method by which such  adjustment  was  calculated and the
effective date of the adjustment.EX-10.2

                             SUBSCRIPTION AGREEMENT

         This  Subscription  Agreement (this  "AGREEMENT") is entered into as of
January 26, 2007 by and among  Patient  Safety  Technologies,  Inc.,  a Delaware
corporation  (together with its successors and permitted assigns, the "ISSUER"),
and A Plus International,  Inc., a California corporation with an office located
at 5138 Eucalyptus Avenue, Chino, California 91710 (together with its successors
and permitted assigns, the "INVESTOR").

                                    RECITALS

         Subject to the terms and  conditions  of this  Agreement,  the Investor
desires to subscribe for and purchase,  and the Issuer desires to issue and sell
to the Investor, certain shares of the Issuer's common stock, par value $.33 per
share (the "COMMON  STOCK"),  to purchase shares of Common Stock.  The Issuer is
offering  One  Million  ($1,000,000)  in shares of  Common  Stock,  in a private
placement  to the  Investor  at a purchase  price of One Dollar and  Twenty-Five
Cents ($1.25) per share and on the other terms and conditions  contained in this
Agreement (the "OFFERING"),  including thirty seven and one half percent (37.5%)
warrant  coverage at Two Dollars ($2.00) per share,  exercisable for a period of
five (5) years (the  "WARRANT");  PROVIDED that the Issuer reserves the right to
issue and sell a lesser or  greater  number of  shares.  Additional  information
disclosed  in  the  Company's  10-K's  and  10-Q's  is  hereby  incorporated  by
reference.

                               TERMS OF AGREEMENT

         In  consideration  of  the  mutual   representations   and  warranties,
covenants and agreements contained herein, the parties hereto agree as follows:

1.       SUBSCRIPTION AND ISSUANCE OF COMMON STOCK.

         1.1      SUBSCRIPTION  AND  ISSUANCE  OF COMMON  STOCK.  Subject to the
terms and conditions of this  Agreement,  the Issuer shall issue and sell to the
Investor,  and the Investor  subscribes  for and shall purchase from the Issuer,
that number of shares of Common Stock set forth on such  Investor's  counterpart
signature page hereof (the "Shares" or "SECURITIES") for the aggregate  purchase
price set forth on such  counterpart  signature page,  which aggregate  purchase
price  shall be equal to the product of the number of Shares  subscribed  for by
such Investor  multiplied by the per share purchase price specified in the above
Recitals to this Agreement (the "PURCHASE  Price").  The Purchase Price includes
the Warrant.

         1.2      LEGENDS.

                  Any certificate or certificates  representing the Shares shall
                  bear the following  legend, in addition to any legend that may
                  be required by any Requirements of Law:

                  THE SHARES REPRESENTED BY THIS CERTIFICATE ARE BEING
                  ISSUED  PURSUANT  TO  THE  TERMS  OF A  SUBSCRIPTION
                  AGREEMENT  WITH THE ISSUER DATED AS OF  ___________,
                  2007,  A COPY OF WHICH IS ON FILE  WITH THE  ISSUER.
                  THE SHARES REPRESENTED BY THIS CERTIFICATE ISSUED

<PAGE>

                  HEREWITH UNDER SUCH SUBSCRIPTION  AGREEMENT WILL NOT
                  BE SEPARATELY TRANSFERABLE.

                  IN  ADDITION,   THE  SHARES   REPRESENTED   BY  THIS
                  CERTIFICATE  MAY  NOT  BE  SOLD,   TRANSFERRED,   OR
                  OTHERWISE  DISPOSED OF BY THE HOLDER EXCEPT PURSUANT
                  TO AN EFFECTIVE  REGISTRATION  STATEMENT FILED UNDER
                  THE  SECURITIES  ACT OF  1933,  AS  AMENDED,  AND IN
                  COMPLIANCE  WITH  APPLICABLE  SECURITIES LAWS OF ANY
                  STATE WITH RESPECT  THERETO OR IN ACCORDANCE WITH AN
                  OPINION   OF   COUNSEL   IN   FORM   AND   SUBSTANCE
                  SATISFACTORY  TO THE ISSUER THAT AN  EXEMPTION  FROM
                  SUCH  REGISTRATION  IS AVAILABLE AND ALSO MAY NOT BE
                  SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF EXCEPT IN
                  COMPLIANCE   WITH  ANY   APPLICABLE   RULES  OF  THE
                  SECURITIES AND EXCHANGE COMMISSION.

         1.3      FUTURE FINANCINGS. In the event the Issuer conducts additional
financings,  the Investor shall have the right to participate in such financings
such that its percentage ownership interest in the Issuer remains unchanged.

2.       CLOSING.

         2.1      CLOSING.  The closing of the transactions  contemplated herein
(the "CLOSING") shall take place simultaneously upon execution of this Agreement
at the  offices of Issuer  located at 1800  Century  Park East,  Suite 200,  Los
Angeles,  CA 90067.  At the  Closing:  (i) the  Investor  participating  in such
Closing shall pay to the Issuer, by wire transfer of immediately available funds
to an  account  designated  in writing by the  Issuer,  the cash  portion of the
Purchase  Price,  $500,000,  for the Shares  being  purchased  by such  Investor
hereunder;  (ii) the Investor  shall deliver to the Issuer,  as requested by the
Issuer,  Safety  Sponge  product  valued at  $500,000.  The value of such Safety
Sponge  product shall be determined  in  accordance  with the  provisions of the
Exclusive License and Supply Agreement entered into on January 26, 2007, between
the Issuers  wholly-owned  subsidiary,  SurgiCount  Medical,  Inc., a California
corporation, and the Investor; (iii) the Issuer shall issue to such Investor the
Shares being  purchased by the Investor  hereunder and shall deliver or cause to
be delivered to such Investor a certificate or  certificates  representing  such
Shares  duly  registered  in the  name of such  Investor,  as  specified  on the
signature pages hereto; and (iv) all other actions referred to in this Agreement
which  are  required  to be taken at such  Closing  shall be taken and all other
agreements  and documents  referred to in this  Agreement  that are required for
such Closing shall be executed and delivered.

         All funds can be wired to Issuer's escrow agent as follows:

         Bank:  Keybank National Association
                444 SW 5th Street
                Portland, Oregon 97204
         Name:  TOL FBO Patient Safety Technologies
         ABA:   123002011
         Acct:  370151012967

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<PAGE>

         Any checks are to be made out to Transfer Online, Inc. and mailed to:

         Transfer Online, Inc.
         317 SW Alder Street
         Portland, Oregon  97204
         Attn: Escrow Acct. 370151012967

3.       REPRESENTATIONS AND WARRANTIES OF THE INVESTOR.

         As a material inducement to the Issuer to enter into this Agreement and
issue the Securities,  the Investor represents,  warrants,  and covenants to the
Issuer as follows:

         3.1      POWER AND AUTHORITY.  Such  Investor,  if other than a natural
person, is an entity duly organized, validly existing and in good standing under
the laws of the state of its  incorporation or formation.  Such Investor has the
corporate,  partnership  or other  power (or,  in the case of a natural  person,
legal capacity) and authority  under  applicable law to execute and deliver this
Agreement and  consummate  the  transactions  contemplated  hereby,  and has all
necessary  authority to execute,  deliver and perform its obligations under this
Agreement and to consummate the transactions  contemplated hereby. Such Investor
has  taken all  necessary  action  to  authorize  the  execution,  delivery  and
performance of this Agreement and the transactions contemplated hereby.

         3.2      NO  VIOLATION.  The execution and delivery by such Investor of
this Agreement,  the consummation of the transactions  contemplated  hereby, and
the compliance by such Investor with the terms and provisions hereof,  will not:
(i)  result in a default  under (or give any  other  party the  right,  with the
giving of notice or the  passage  of time (or  both),  to  declare a default  or
accelerate any obligation  under) any Contract to which such Investor is a party
or by which it or its  properties or assets are bound (except to the extent such
defaults  or  accelerations,   individually  or  in  the  aggregate,  would  not
reasonably be expected to have a Material Adverse Effect on such Investor); (ii)
violate any  Requirement of Law  applicable to such  Investor;  or (iii) if such
Investor is other than a natural person, violate any charter,  bylaws or similar
documents of such Investor.  At or prior to the Closing, such Investor will have
complied with all  Requirements  of Law applicable to it in connection  with the
Offering  and at all  times  thereafter  such  Investor  will  comply  with  all
Requirements  of Law applicable to it in connection  with any resale or transfer
by such Investor of any  Securities  acquired by such Investor  pursuant to this
Agreement.

         3.3      CONSENTS/APPROVALS.  No consents,  filings,  authorizations or
actions  of  any  Governmental   Authority  are  required  for  such  Investor's
execution,  delivery and  performance of this Agreement.  No consent,  approval,
waiver or other  actions by any Person under any Contract to which such Investor
is a party or by which  such  Investor  or any of its  properties  or assets are
bound is required or necessary for the  execution,  delivery and  performance by
such  Investor  of this  Agreement  and  the  consummation  of the  transactions
contemplated hereby.

         3.4      ENFORCEABILITY.  This  Agreement  has been duly  executed  and
delivered by such Investor and (assuming it has been duly authorized,  executed,
and delivered by the Issuer)

                                       3
<PAGE>

constitutes a legal, valid and binding obligation of such Investor,  enforceable
against  such   Investor  in   accordance   with  its  terms,   except  as  such
enforceability may be limited by applicable bankruptcy,  insolvency,  fraudulent
conveyances,  reorganization,  moratorium  or similar  laws from time to time in
effect  affecting the enforcement of creditor's  rights  generally,  and general
equitable  principles,  regardless of whether  enforceability is considered in a
proceeding  at law or in  equity,  and except for the  indemnity  provisions  of
ARTICLE 5 of this  Agreement,  which may not be  enforceable  based upon  public
policy considerations.

         3.5      INVESTMENT  INTENT.  Buyer is acquiring the Shares for its own
account,  for  investment  purposes  only and not with a view to resale or other
distribution  thereof,  nor with  the  intention  of  selling,  transferring  or
otherwise  disposing of all or any part of such Shares, or any interest therein,
for any particular  price,  or at any particular  time, or upon the happening of
any  particular  event  or  circumstances,   except  selling,  transferring,  or
disposing of such Shares made in full compliance with all applicable  provisions
of the Securities Act of 1993 (the "Securities Act") and the Securities Exchange
Act of 1934,  and the Rules and  Regulations  promulgated  by the Securities and
Exchange Commission thereunder, all as amended.

         3.6      ACCREDITED INVESTOR. Such Investor is an "accredited investor"
as such term is defined in Rule 501(a) of Regulation D under the Securities Act.
Without limiting the foregoing  representation,  such Investor  confirms that it
has  reviewed  the  partial  definition  of an  "Accredited  Investor"  which is
attached  hereto as EXHIBIT A (which is not a complete  definition  of the term,
but which includes the most likely  categories of  qualification) to confirm the
accuracy  of such  representation,  and such  Investor  has  noted by  paragraph
number, on its signature page hereto,  the category(ies)  pursuant to which such
Investor qualifies as an "Accredited  Investor"  according to the definition set
forth in  EXHIBIT  A. Such  Investor  has not been  formed  for the  purpose  of
acquiring the Securities.  Such Investor is not an officer, director,  employee,
investment  advisor,  promoter,  general  partner,  Affiliate  or  member of the
advisory board of the Issuer.

         3.7      ADEQUATE  INFORMATION.  Such Investor has received either from
the Issuer or through a search of the Issuer's  public filings with the SEC (the
"SEC REPORTS"),  and has reviewed,  such information as such Investor  considers
necessary or  appropriate  to evaluate the risks and merits of an investment in,
and make an informed investment  decision with respect to, the Securities.  Such
Investor  acknowledges that each of the SEC Reports,  including the risk factors
contained therein, are specifically incorporated herein by reference and form an
integral part of this Agreement.

         3.8      OPPORTUNITY TO QUESTION. Such Investor has had the opportunity
to question, and has questioned,  to the extent deemed necessary or appropriate,
representatives  of the  Issuer  so as to  receive  answers  from  the  Issuer's
representatives  regarding  the terms and  conditions  of an  investment  in the
Securities and to verify information obtained in such Investor's  examination of
the Issuer,  including,  without limitation,  the information that such Investor
may have  received and reviewed as  referenced in SECTION 3.7 in relation to its
investment in the Securities.

         3.9      NO OTHER REPRESENTATIONS.  No oral or written  representations
have been made to such Investor in connection with such  Investor's  acquisition
of the  Securities  which  were in any way  inconsistent  with  the  information
reviewed by such Investor. Such Investor acknowledges

                                       4
<PAGE>

that,  in  deciding  whether to enter  into this  Agreement  and to acquire  the
Securities hereunder,  it has not relied on any representations or warranties of
any type or description  made by the Issuer or any of its  representatives  with
regard to the Issuer or its  business,  property or prospects of the  investment
contemplated herein, other than the representations and warranties of the Issuer
set forth in this ARTICLE 3.

         3.10     KNOWLEDGE AND EXPERIENCE.  Such Investor  understands  that an
investment in the Securities  involves  substantial risk. Such Investor has such
knowledge  and  experience  in financial,  tax and business  matters,  including
substantial  experience  in  evaluating  and investing in common stock and other
securities  (including  the common  stock and other  securities  of  speculative
companies), so as to enable such Investor to utilize the information referred to
in SECTION 3.7 hereof and any other  information made available by the Issuer to
such  Investor in order to evaluate the merits and risks of an investment in the
Securities  and to make an informed  investment  decision with respect  thereto.
Specifically,  such Investor has given  appropriate  consideration  to the early
stage of  development of the Issuer's  primary  business as well as the Issuer's
financial condition including its ability to continue as a going concern.

         3.11     INDEPENDENT  DECISION.  Such  Investor  is not  relying on the
Issuer  or on any  legal or other  opinion  in the  materials  reviewed  by such
Investor  with respect to the financial or tax  considerations  of such Investor
relating to its investment in the Securities. Such Investor has relied solely on
the  representations  and warranties,  covenants and agreements of the Issuer in
this  Agreement  (including  the  exhibits  and  schedules  hereto)  and  on its
examination and independent  investigation in making its decision to acquire the
Securities.

4.       REGISTRATION RIGHTS.

         The  Issuer is  required  to  include  the  Securities,  including  any
securities  acquired from the exercise of the Warrant,  acquired pursuant to the
terms  of  this  Agreement  in the  next  registration  statement,  excluding  a
registration  statement on Form S-4 or S-8, filed with the SEC. In the event the
Issuer files a registration statement pursuant to the Securities Act of 1933, as
amended, the Securities,  including any securities acquired pursuant to exercise
of the Warrant, shall be included for resale in such registration  statement, as
provided in EXHIBIT B hereto. A form of the Warrant to be issued pursuant hereto
is attached as EXHIBIT C.

5.       INDEMNIFICATION.

         5.1      INDEMNIFICATION  BY THE ISSUER.  The Issuer will indemnify and
hold  harmless  the  Holder  or  Selling  Stockholder  of  Shares  covered  by a
Registration  Statement  pursuant to the provisions of ARTICLE 6, any Person who
controls such Holder or Selling Stockholder within the meaning of the Securities
Act, and any officer,  director,  investment adviser,  employee, agent, partner,
member  or  Affiliate   of  such  Holder  or  Selling   Stockholder   (each,   a
"HOLDER/SELLING  STOCKHOLDER  INDEMNIFIED  PARTY"),  from and against,  and will
reimburse each such  Holder/Selling  Stockholder  Indemnified Party with respect
to, any and all claims, actions,  demands, losses, damages,  liabilities,  costs
and expenses to which such Holder/Selling Stockholder or any such Holder/Selling
Stockholder  Indemnified  Party may become  subject under the  Securities Act or
otherwise,   insofar  as  such  claims,  actions,   demands,   losses,  damages,
liabilities,  costs or expenses  arise out of or are based upon:  (a) any untrue
statement or alleged

                                       5
<PAGE>

untrue statement of any material fact contained in such registration  statement,
any prospectus contained therein or any amendment or supplement thereto; (b) the
omission or alleged  omission to state  therein a material  fact  required to be
stated therein or necessary to make the  statements  therein (in the case of any
preliminary prospectus or prospectus,  in light of the circumstances under which
they were made) not misleading;  or (c) any materially inaccurate representation
or  breach  of any  material  warranty,  agreement  or  covenant  of the  Issuer
contained  herein;  PROVIDED that the Issuer will not be liable in any such case
to the extent that any such claim, action, demand, loss, damage, liability, cost
or expense arises out of or is based upon an untrue  statement or alleged untrue
statement or omission or alleged omission (i) made in reliance on and conformity
with  information  furnished  by  any  Holder/Selling   Stockholder  in  writing
specifically  for use in the  preparation  thereof or (ii) which was cured in an
amendment or  supplement  to the  prospectus  (or any  amendment  or  supplement
thereto) delivered to the Holder/Selling Stockholder on a timely basis to permit
proper delivery  thereof prior to the date on which any Shares were  transferred
or sold.

         5.2      INDEMNIFICATION  BY THE  HOLDER OR SELLING  STOCKHOLDER.  Each
Holder  and  each  Selling  Stockholder  of  Shares  covered  by a  Registration
Statement  pursuant  to the  provisions  of  ARTICLE 4 will  indemnify  and hold
harmless the Issuer,  any Person who  controls the Issuer  within the meaning of
the Securities Act, and any officer, director,  employee, agent, partner, member
or  Affiliate  of the Issuer  (each,  an "ISSUER  INDEMNIFIED  Party")  from and
against,  and will reimburse the Issuer Indemnified Parties with respect to, any
and all  claims,  actions,  demands,  losses,  damages,  liabilities,  costs  or
expenses to which such Issuer  Indemnified  Parties may become subject under the
Securities Act or otherwise, insofar as such losses, damages, liabilities, costs
or  expenses  arise out of or are based upon:  (a) any untrue or alleged  untrue
statement of any material fact  contained in such  Registration  Statement,  any
prospectus  contained therein or any amendment or supplement thereto; or (b) the
omission or the alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein,  (in the case of any
preliminary prospectus or prospectus,  in light of the circumstances under which
they were  made) not  misleading,  in each case to the  extent,  but only to the
extent,  that such untrue  statement or alleged untrue  statement or omission or
alleged  omission  was so  made  in  reliance  on and  conformity  with  written
information furnished by such Holder or Selling Stockholder specifically for use
in the preparation thereof; PROVIDED that the liability of any Holder or Selling
Stockholder  pursuant  to this  SECTION 5.2 shall be limited to an amount not to
exceed the net proceeds received by such Holder or Selling  Stockholder from the
sale of Registrable  Securities  pursuant to the  Registration  Statement  which
gives rise to such obligation to indemnify.

         5.3      PROCEDURES.  Promptly  after  receipt  by a party  indemnified
pursuant  to the  provisions  of  SECTION  5.1 or  SECTION  5.2 of notice of the
commencement  of any  action  involving  the  subject  matter  of the  foregoing
indemnity  provisions,  such indemnified party will, if a claim thereof is to be
made against the indemnifying party pursuant to the provisions of SECTION 5.1 or
SECTION 5.2, notify the indemnifying party of the commencement thereof; PROVIDED
the  omission to so notify the  indemnifying  party will not relieve it from any
liability  which it may have to an indemnified  party  otherwise than under this
ARTICLE 5, and shall not relieve the  indemnifying  party from  liability  under
this ARTICLE 5, except to the extent that such indemnifying  party is materially
prejudiced  by such  omission.  In case  such  action  is  brought  against  any
indemnified  party and it notifies the  indemnifying  party of the  commencement
thereof, the indemnifying

                                       6
<PAGE>

party  shall have the right to  participate  in,  and, to the extent that it may
wish, jointly with any other indemnifying  party similarly  notified,  to assume
the defense thereof,  with counsel  reasonably  satisfactory to such indemnified
party, and after notice from the indemnifying party to such indemnified party of
its election to assume the defense thereof,  the indemnifying  party will not be
liable to such  indemnified  party  pursuant to the provisions of SECTION 5.1 or
SECTION  5.2 for any  legal  or  other  expense  subsequently  incurred  by such
indemnified party in connection with the defense thereof.  No indemnifying party
shall be liable to an  indemnified  party for any  settlement  of any  action or
claim without the consent of the indemnifying  party. No indemnifying party will
consent to entry of any  judgment  or enter into any  settlement  which does not
include as an unconditional term thereof the giving by the claimant or plaintiff
to such  indemnified  party of an  unconditional  release from all  liability in
respect to such action, claim or litigation.

6.       MISCELLANEOUS.

         6.1      DEFINED TERMS.  As used herein the following  terms shall have
the following meanings:

                  (a)      "AFFILIATE"  has the  meaning  ascribed to it in Rule
12b-2 of the General Rules and Regulations  under the Exchange Act, as in effect
on the date hereof.

                  (b)      "AGREEMENT" has the meaning specified in the preamble
to this Agreement.

                  (c)      "AMEX" has the meaning  specified  in SECTION 6.12 of
this Agreement.

                  (d)      "BUSINESS DAY" means any day except Saturday,  Sunday
and any day which shall be a federal  legal holiday or a day on which either (i)
the SEC or (ii) banking  institutions in the State of New York are authorized or
required by law or other governmental action to close.

                  (e)      "BYLAWS" means the Bylaws of the Issuer,  as the same
may be supplemented, amended, or restated from time to time.

                  (f)      "CERTIFICATE  OF  INCORPORATION"  means the  Issuer's
Certificate  of  Incorporation,  as the same  may be  supplemented,  amended  or
restated from time to time.

                  (g)      "CLOSING" has the meaning specified in SECTION 2.1 of
this Agreement.

                  (h)      "COMMON  STOCK"  has  the  meaning  specified  in the
Recitals to this Agreement.

                  (i)      "CONFIDENTIAL  INFORMATION" has the meaning specified
in SECTION 6.13 of this Agreement.

                  (j)      "CONTRACT" means any indenture, lease, sublease, loan
agreement,  mortgage,  note,  restriction,   commitment,   obligation  or  other
contract, agreement or instrument.

                                       7
<PAGE>

                  (k)      Intentionally deleted.

                  (l)      "EXCHANGE ACT" means the  Securities  Exchange Act of
1934, as amended.

                  (m)      "GAAP" means generally accepted accounting principles
in effect in the United States of America.

                  (n)      "GOVERNMENTAL   AUTHORITY"   means   any   nation  or
government,  any state or other political subdivision thereof, and any entity or
official   exercising   executive,   legislative,    judicial,   regulatory   or
administrative functions of or pertaining to government.

                  (o)      "HOLDER/SELLING  STOCKHOLDER  INDEMNIFIED  PARTY" has
the meaning specified in SECTION 5.1 of this Agreement.

                  (p)      "INVESTOR" has the meaning  specified in the preamble
to this Agreement.

                  (q)      "ISSUER" means Patient Safety  Technologies,  Inc., a
Delaware corporation.

                  (r)      "ISSUER  INDEMNIFIED PARTY" has the meaning specified
in SECTION 5.2 of this Agreement.

                  (s)      "KNOWLEDGE"  means,  with respect to the Issuer,  the
actual knowledge of William B. Horne.

                  (t)      "MATERIAL   ADVERSE  EFFECT"  means  a  material  and
adverse change in, or effect on, the financial  condition,  properties,  assets,
liabilities, rights, obligations, operations or business, of a Person.

                  (u)      "OFFERING" has the meaning  specified in the Recitals
to this Agreement.

                  (v)      "PERMIT"  means  any  permit,  certificate,  consent,
approval,  authorization,  order, license, variance,  franchise or other similar
indicia of authority issued or granted by any Governmental Authority.

                  (w)      "PERSON"   means  a  natural   person,   partnership,
corporation,  limited liability  company,  business trust,  joint stock company,
estate, trust, unincorporated association, joint venture, Governmental Authority
or other entity, of whatever nature.

                  (x)      "PURCHASE PRICE" has the meaning specified in SECTION
1.1 of this Agreement.

                  (y)      "RULE  144"  means  Rule 144  promulgated  under  the
Securities Act, or any successor thereto.

                  (z)      "SEC" means the Securities and Exchange Commission.

                  (aa)     "SECURITIES" has the meaning specified in SECTION 1.1
of this Agreement.

                  (bb)     "SECURITIES ACT" means the Securities Act of 1933, as
amended.

                                       8
<PAGE>

                  (cc)     "SHARES" has the meaning  specified in SECTION 1.1 of
this Agreement.

                  (dd)     "WARRANT"  has the meaning  specified in the Recitals
to this Agreement.

         6.2      OTHER DEFINITIONAL PROVISIONS.

                  (a)      All terms  defined in this  Agreement  shall have the
defined meanings when used in any certificates,  reports or other documents made
or delivered pursuant hereto or thereto, unless the context otherwise requires.

                  (b)      Terms defined in the singular shall have a comparable
meaning when used in the plural, and vice versa.

                  (c)      All accounting terms shall have a meaning  determined
in accordance with GAAP.

                  (d)      The words  "hereof,"  "herein" and  "hereunder,"  and
words  of  similar  import,  when  used in this  Agreement  shall  refer to this
Agreement as a whole  (including  any exhibits and schedules  hereto) and not to
any particular provision of this Agreement.

         6.3      NOTICES.  All notices,  requests,  demands,  claims, and other
communications hereunder shall be in writing and shall be delivered by certified
or  registered  mail  (first  class  postage  pre-paid),   guaranteed  overnight
delivery,  or  facsimile  transmission  if such  transmission  is  confirmed  by
delivery by  certified or  registered  mail (first  class  postage  pre-paid) or
guaranteed  overnight delivery,  to the following addresses and telecopy numbers
(or to  such  other  addresses  or  telecopy  numbers  which  such  party  shall
subsequently designate in writing to the other party):

                  (a)      if to the Issuer to:

                           Patient Safety Technologies, Inc.
                           c/o William B. Horne
                           1800 Century Park East
                           Suite 200
                           Los Angeles, CA 90067
                           Facsimile: (310) 895-7751

                  (b)      if to an  Investor,  to the address set forth next to
such Investor's name on such Investor's counterpart signature page hereto.

         Each such notice or other  communication shall for all purposes of this
Agreement  be treated as  effective  or having  been  given  when  delivered  if
delivered by hand,  by messenger or by courier,  or if sent by  facsimile,  upon
confirmation of receipt.

         6.4      ENTIRE AGREEMENT.  This Agreement  (including the exhibits and
schedules attached hereto) and other documents delivered at the Closing pursuant
hereto,  contain  the  entire  understanding  of the  parties  in respect of its
subject matter and supersede all prior agreements and understandings between the
parties with respect to such subject matter.

                                       9
<PAGE>

         6.5      EXPENSES;  TAXES.  The  parties  shall  pay their own fees and
expenses,  including  their own counsel fees,  incurred in connection  with this
Agreement or any  transaction  contemplated  hereby.  Any sales tax, stamp duty,
deed transfer or other tax (except  taxes based on the income of the  Investors)
arising  out  of the  issuance  of the  Securities  (but  not  with  respect  to
subsequent  transfers) by the Issuer to the Investors  and  consummation  of the
transactions contemplated by this Agreement shall be paid by the Issuer.

         6.6      AMENDMENT;   WAIVER.  This  Agreement  may  not  be  modified,
amended,  supplemented,  canceled or  discharged,  except by written  instrument
executed by the parties to this Agreement.  No failure to exercise, and no delay
in exercising,  any right, power or privilege under this Agreement shall operate
as a waiver,  nor shall any single or partial  exercise  of any right,  power or
privilege  hereunder  preclude  the  exercise  of  any  other  right,  power  or
privilege.  No waiver of any  breach  of any  provision  shall be deemed to be a
waiver of any preceding or succeeding breach of the same or any other provision,
nor shall any waiver be implied from any course of dealing  between the parties.
No extension of time for  performance of any obligations or other acts hereunder
or under any other  agreement shall be deemed to be an extension of the time for
performance of any other  obligations or any other acts. The rights and remedies
of the parties  under this  Agreement  are in  addition to all other  rights and
remedies, at law or equity, that they may have against each other.

         6.7      BINDING EFFECT; ASSIGNMENT. The rights and obligations of this
Agreement  shall  bind  and  inure  to the  benefit  of the  parties  and  their
respective  successors  and legal  assigns.  The rights and  obligations  of the
Issuer pursuant to this Agreement may not be assigned to any third party without
the prior  written  consent  of the  Holders of a  majority  of the  Registrable
Securities.

         6.8      COUNTERPARTS;  FACSIMILE  SIGNATURE.  This  Agreement  may  be
executed by facsimile signature and in any number of counterparts, each of which
shall be an original but all of which together shall constitute one and the same
instrument.

         6.9      HEADINGS.  The headings  contained in this  Agreement  are for
convenience of reference only and are not to be given any legal effect and shall
not affect the meaning or interpretation of this Agreement.

         6.10     GOVERNING  LAW;   INTERPRETATION.   This  Agreement  shall  be
construed  in  accordance  with and governed for all purposes by the laws of the
State of California  applicable to contracts executed and to be wholly performed
within such state.

         6.11     SEVERABILITY.   The  parties  stipulate  that  the  terms  and
provisions  of this  Agreement  are fair and  reasonable  as of the date of this
Agreement.  However,  any provision of this  Agreement  shall be determined by a
court of  competent  jurisdiction  to be  invalid,  void or  unenforceable,  the
remainder of the terms, provisions, covenants and restrictions of this Agreement
shall remain in full force and effect and shall in no way be affected,  impaired
or invalidated.  If,  moreover,  any of those provisions shall for any reason be
determined  by a court of competent  jurisdiction  to be  unenforceable  because
excessively  broad or vague as to  duration,  activity or  subject,  it shall be
construed by limiting, reducing or defining it, so as to be enforceable.

                                       10
<PAGE>

         6.12     FURTHER  ASSURANCES.  Each of the parties hereto shall execute
and deliver such additional  instruments and other documents and shall take such
further  actions as may be reasonably  necessary or  appropriate  to effectuate,
carry  out  and  comply  with  all  of the  terms  of  this  Agreement  and  the
transactions contemplated hereby. Each of the Investor and the Issuer shall make
on a prompt and timely basis all  governmental or regulatory  notifications  and
filings  required  to be made by it with  or to any  Governmental  Authority  in
connection with the consummation of the transactions  contemplated  hereby.  The
Issuer and the Investor agree to cooperate  with one another in the  preparation
and  filing  of all  forms,  notifications,  reports  and  information,  if any,
required or reasonably  deemed  advisable  pursuant to any Requirement of Law or
the American Stock Exchange  ("AMEX") rules in connection with the  transactions
contemplated  by  this  Agreement  and  to  use  their  respective  commercially
reasonable  efforts to agree  jointly on a method to overcome any  objections by
any Governmental Authority to any such transactions.

         6.13     CONFIDENTIAL  INFORMATION.  The Investor  confirms that it has
entered into a confidentiality agreement with the Issuer, pursuant to which such
Investor has agreed to keep  confidential  certain  information  relating to the
Issuer that has been disclosed by the Issuer to the Investor in connection  with
such  Investor's  investment in the  Securities,  and that such  Investor  shall
continue to be bound by such  confidentiality  agreement  after the Closing.  In
addition,  the Investor agrees that no portion of the  Confidential  Information
(as  defined  below)  shall be  disclosed  to third  parties,  except  as may be
required  by law,  without  the prior  express  written  consent of the  Issuer;
PROVIDED that the Investor may share such  information with such of its officers
and  professional  advisors as may need to know such  information to assist such
Investor in its evaluation  thereof, on the condition that such parties agree to
be bound by the terms of this SECTION 6.13. "CONFIDENTIAL INFORMATION" means the
existence and terms of this Agreement, the transactions contemplated hereby, and
the  disclosures  and  other  information   contained   herein,   excluding  any
disclosures or other information that is publicly available.

         6.14     BOARD  REPRESENTATION.  The Board of  Directors  of the Issuer
("Board")  shall  include at least 1 member  designate by the  Investor,  namely
Wenchen Lin.

         6.15     MATTERS REQUIRING INVESTOR DIRECTOR APPROVAL.  The Issuer will
not, without Board approval, which approval must include the affirmative vote of
the Investor designated Director: (i) incur any aggregate indebtedness in excess
of $200,000 that is not already included in a Board-approved  budget, other than
trade credit incurred in the ordinary  course of business and  convertible  debt
that shall automatically  convert to common stock upon the requisite  approvals;
or (ii) sell, transfer,  license,  pledge or encumber technology or intellectual
property, other than licenses granted in the ordinary course of business

         6.16     MANAGEMENT AND INFORMATION RIGHTS. Until the later time of two
years from the closing of a Financing or such time as the Issuer's  revenues are
sufficient to fund the Issuer's  operations  the Investor will be granted access
to Company  facilities  and  personnel  during  normal  business  hours and with
reasonable  advance  notification.  The Issuer will  deliver to the Investor (i)
annual,  quarterly,  and, to the extent  readily  available,  monthly  financial
statements,  and other  information as determined by the Board; (ii) thirty days
prior  to the  end  of  each  fiscal  year,  a  comprehensive  operating  budget
forecasting   the  Issuer's   revenues,   expenses,   and  cash  position  on  a
month-to-month  basis for the upcoming fiscal year; and (iii) promptly following
the end of

                                       11
<PAGE>

each quarter an up-to-date capitalization table, certified by the CFO.

         6.17     Registration of Shares.  The Issuer shall,  within the earlier
of ninety  (90) days of an equity  raise  with gross  proceeds  of at least Four
Million Dollars  ($4,000,000) or July 15, 2007, cause to be filed a Registration
Statement under the Securities Act of 1933, as amended, for the registration and
resale of the Share and Warrants as applicable.

                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

                                       12
<PAGE>

         IN WITNESS  WHEREOF,  the parties hereto have caused this  Subscription
Agreement to be duly executed and delivered as of the date set forth below.

                                      ISSUER:

                                      PATIENT SAFETY TECHNOLOGIES, INC.

                                      By:
                                         ---------------------------------------

                                      Name: William B. Horne
                                           -------------------------------------

                                      Title: Chief Executive Officer
                                            ------------------------------------

                                       13
<PAGE>

                      [INVESTOR COUNTERPART SIGNATURE PAGE]

NAME OF INVESTOR (please print)                ADDRESS FOR NOTICE (please print)

                                               5138 Eucalyptus Avenue
                                               ---------------------------------
A Plus International, Inc.                     Chino, CA 91710
------------------------------------           ---------------------------------

                                               ---------------------------------
                                               Attention:
                                                         -----------------------
                                               Tax Identification #:
                                                                    ------------
SIGNATURE

By:
   ---------------------------------

Name:
     -------------------------------

Title:
      ------------------------------

Date:
     -------------------------------

Exact name to appear on stock certificate:     Number of Shares subscribed for:

A Plus International, Inc.                     800,000
------------------------------------                  --------------------------

Aggregate Purchase Price (see SECTION 1.1):    Categories pursuant to which
                                               Investor qualifies as an
                                               Accredited Investor as defined
                                               in EXHIBIT A to this Agreement
                                               (please indicate the applicable
                                               section numbers noted on
                                               EXHIBIT A to this Agreement):

                                               Category 3
$1,000,000                                     ---------------------------------
          ---------

                                       14
<PAGE>

                                    EXHIBIT A

                       DEFINITION OF "ACCREDITED INVESTOR"

         "ACCREDITED INVESTOR" shall mean any person who comes within any of the
following categories,  or who the Issuer reasonably believes comes within any of
the  following  categories,  at the time of the sale of the  Securities  to that
person:

                  1.       Any bank as defined in section 3(a)(2) of the Act, or
any  savings and loan  association  or other  institution  as defined in section
3(a)(5)(A) of the Act whether  acting in its  individual or fiduciary  capacity;
any  broker  or dealer  registered  pursuant  to  section  15 of the  Securities
Exchange Act of 1934;  any insurance  company as defined in section 2(13) of the
Act; any investment  company registered under the Investment Company Act of 1940
or a business  development  company as defined in section  2(a)(48) of that Act;
any Small  Business  Investment  Company  licensed  by the U.S.  Small  Business
Administration  under section 301(c) or (d) of the Small Business Investment Act
of  1958;  any  plan  established  and  maintained  by a  state,  its  political
subdivisions,  or any  agency  or  instrumentality  of a state or its  political
subdivisions, for the benefit of its employees, if such plan has total assets in
excess of  $5,000,000;  any  employee  benefit  plan  within the  meaning of the
Employee  Retirement  Income Security Act of 1974 if the investment  decision is
made by a plan  fiduciary,  as defined in  section  3(21) of such act,  which is
either a bank, savings and loan association,  insurance  company,  or registered
investment  adviser,  or if the employee benefit plan has total assets in excess
of $5,000,000 or, if a self-directed plan, with investment decisions made solely
by persons that are Accredited Investors;

                  2.       Any private business  development  company as defined
in section 202(a)(22) of the Investment Advisers Act of 1940;

                  3.       Any  organization  described in section  501(c)(3) of
the Internal Revenue Code, corporation, Massachusetts or similar business trust,
or partnership,  not formed for the specific purpose of acquiring the securities
offered, with total assets in excess of $5,000,000;

                  4.       Any director,  executive officer,  or general partner
of the Issuer,  or any  director,  executive  officer,  or general  partner of a
general partner of the Issuer;

                  5.       Any natural  person whose  individual  net worth,  or
joint net worth with that person's  spouse,  at the time of his purchase exceeds
$1,000,000;

                  6.       Any natural  person who had an  individual  income in
excess of  $200,000 in each of the two most  recent  years or joint  income with
that  person's  spouse in excess of  $300,000  in each of those  years and has a
reasonable expectation of reaching the same income level in the current year;

                  7.       Any trust, with total assets in excess of $5,000,000,
not formed for the specific purpose of acquiring the Securities,  whose purchase
is directed by a sophisticated person as described in 230.506(b)(2)(ii); and

                  8.       Any  entity in which  all of the  equity  owners  are
Accredited Investors.

<PAGE>

                                    EXHIBIT B

                            NOTICE AND QUESTIONNAIRE

         The undersigned  beneficial holder of Registrable Securities of Patient
Safety Technologies,  Inc. (the "ISSUER")  understands that the Issuer has filed
or intends to file with the  Securities  and  Exchange  Commission  (the "SEC"),
within the earlier of ninety (90) days of an equity raise with gross proceeds of
at least Four Million  Dollars  ($4,000,000)  or July 15,  2007, a  Registration
Statement under the Securities Act of 1933, as amended (the  "SECURITIES  ACT"),
for the registration and resale of the Registrable Securities in accordance with
the terms of the Subscription  Agreement (the  "SUBSCRIPTION  AGREEMENT") by and
among the Issuer and the purchasers of the Issuer's securities  thereunder.  The
Subscription  Agreement is available from the Issuer upon request at the address
set forth below.  All  capitalized  terms used but not otherwise  defined herein
shall have the respective meanings given to them in the Subscription Agreement.

         Each beneficial  owner of Registrable  Securities that has agreed to be
bound by certain  provisions  of the  Subscription  Agreement is entitled to the
benefits of the Subscription  Agreement under such provisions.  In order to sell
or otherwise dispose of any Registrable  Securities pursuant to the Registration
Statement,  a  beneficial  owner of  Registrable  Securities  generally  will be
required  to be named as a selling  securityholder  in the  related  prospectus,
deliver a prospectus  to purchasers of  Registrable  Securities  and be bound by
those  provisions of the  Subscription  Agreement  applicable to such beneficial
owner  (including  certain  indemnification   provisions  as  described  below).
Beneficial owners that do not complete this Notice and Questionnaire and deliver
it to the Issuer as provided below will not be named as selling  securityholders
in the prospectus  and therefore  will not be permitted to sell any  Registrable
Securities pursuant to the Registration Statement.

         Certain  legal  consequences  may arise  from  being  named as  selling
securityholders  in the  Registration  Statement  and  the  related  prospectus.
Accordingly, holders and beneficial owners of Registrable Securities are advised
to consult their own securities law counsel  regarding the consequences of being
named  or not  being  named  as a  selling  securityholder  in the  Registration
Statement and the related prospectus.

NOTICE

         The  undersigned   beneficial  owner  (the  "SELLING  STOCKHOLDER")  of
Registrable   Securities   hereby  requests  that  the  Issuer  include  in  the
Registration Statement the Registrable  Securities  beneficially owned by it and
listed below in Item 3 (unless otherwise specified under Item 3) pursuant to the
Registration  Statement.  The undersigned  Selling  Stockholder,  by signing and
returning this Notice and  Questionnaire,  understands  that it will be bound by
the terms and conditions of this Notice and  Questionnaire  and the Subscription
Agreement.

<PAGE>

         The  undersigned  Selling  Stockholder  hereby  provides the  following
information to the Issuer and  represents and warrants that such  information is
accurate and complete:

QUESTIONNAIRE

      1.   (a)    Full Legal Name of Selling Stockholder: ______________________

           (b)    Full legal name of  registered  holder (if not the same as (a)
                  above)  through  which  Registrable  Securities  listed in (3)
                  below are held: _________________________

           (c)    Full legal name of  broker-dealer or other third party through
                  which  Registrable  Securities  listed  in (3) below are held:
                  __________________________________

           (d)    Full legal name of DTC  participant  (if applicable and if not
                  the  same  as (b)  or (c)  above)  through  which  Registrable
                  Securities listed in (3) below are held:

      2.   Address for Notices to Selling Stockholder:

           Telephone:___________________________________________________________

           Fax:_________________________________________________________________

           Contact Person:______________________________________________________

      3.   Beneficial ownership of Registrable Securities:______________________

           _____________________________________________________________________

           _____________________________________________________________________

           UNLESS OTHERWISE INDICATED IN THE SPACE PROVIDED BELOW, ALL SHARES OF
           COMMON STOCK LISTED IN RESPONSE TO ITEM (3) ABOVE WILL BE INCLUDED IN
           THE REGISTRATION STATEMENT. IF THE UNDERSIGNED DOES NOT WISH ALL SUCH
           SHARES OF COMMON STOCK TO BE SO INCLUDED,  PLEASE  INDICATE BELOW THE
           PRINCIPAL AMOUNT OR THE NUMBER OF SHARES TO BE INCLUDED:_____________
           ______________________________

      4.   Beneficial Ownership of the Issuer's securities  owned by the Selling
           Stockholder:__________________________________________________

                  EXCEPT AS SET FORTH BELOW IN THIS ITEM (4), THE UNDERSIGNED IS
                  NOT THE  BENEFICIAL OR REGISTERED  OWNER OF ANY  SECURITIES OF
                  THE ISSUER OTHER THAN THE REGISTRABLE  SECURITIES LISTED ABOVE
                  IN ITEM (3).

           (a)    Type and  amount of other securities beneficially owned by the
                  Selling Stockholder:__________________________________________

           (b)    CUSIP No(s). of such other securities beneficially owned:_____

      5.   Relationship with the Issuer:________________________________________

                                       2
<PAGE>

           EXCEPT AS SET FORTH  BELOW,  NEITHER THE  UNDERSIGNED  NOR ANY OF ITS
           AFFILIATES,  DIRECTORS OR PRINCIPAL  EQUITY  HOLDERS (5% OR MORE) HAS
           HELD  ANY   POSITION  OR  OFFICE  OR  HAS  HAD  ANY  OTHER   MATERIAL
           RELATIONSHIP  WITH THE ISSUER  (OR ITS  PREDECESSORS  OR  AFFILIATES)
           DURING THE PAST THREE YEARS.

State any exceptions to the foregoing here:_______________________________

         The undersigned  Selling  Stockholder  acknowledges that it understands
its  obligation to comply with the provisions of the Exchange Act, and the rules
thereunder relating to stock manipulation,  particularly Regulation M thereunder
(or any successor rules or regulations) and the provisions of the Securities Act
relating to prospectus delivery,  in connection with any offering of Registrable
Securities  pursuant to the  Registration  Statement.  The  undersigned  Selling
Stockholder  agrees  that  neither it nor any person  acting on its behalf  will
engage in any transaction in violation of such provisions.

         The Selling  Stockholder hereby  acknowledges its obligations under the
Subscription  Agreement to indemnify and hold harmless certain persons set forth
therein.  Pursuant to the  Subscription  Agreement,  the Issuer has agreed under
certain  circumstances  to indemnify the Selling  Stockholders  against  certain
liabilities.

         In accordance with the  undersigned  Selling  Stockholder's  obligation
under the  Subscription  Agreement to provide such information as maybe required
by law for inclusion in the  Registration  Statement,  the  undersigned  Selling
Stockholder  agrees to promptly notify the Issuer of any inaccuracies or changes
in the information  provided herein that may occur subsequent to the date hereof
at any time while the  Registration  Statement  remains  effective.  All notices
hereunder and pursuant to the Subscription Agreement shall be made in writing at
the address set forth below.

         In the event any Selling  Stockholder  transfers  all or any portion of
the Registrable Securities listed in Item (3) above after the date on which such
information is provided to the Issuer,  the Selling  Stockholder will notify the
transferees  at the time of  transfer of its rights and  obligations  under this
Notice and Questionnaire and the Subscription Agreement.

         By signing below, the undersigned Selling  Stockholder  consents to the
disclosure  of the  information  contained  herein in its  answers  to items (1)
through (5) above and the  inclusion  of such  information  in the  Registration
Statement  and any  related  prospectus.  The  undersigned  Selling  Stockholder
understands  that such  information  will be relied  upon by the Issuer  without
independent  investigation  or inquiry in  connection  with the  preparation  or
amendment of the Registration Statement and any related prospectus.

                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

                                       3
<PAGE>

         IN WITNESS WHEREOF, the undersigned Selling  Stockholder,  by authority
duly  given,  has  caused  this  Notice and  Questionnaire  to be  executed  and
delivered either in person or by its authorized agent.

                                       Selling Stockholder:

                                       By:______________________________________
                                          Name:
                                          Title:

      Dated:__________________

PLEASE RETURN THE COMPLETED AND EXECUTED NOTICE AND QUESTIONNAIRE TO:

                    PATIENT SAFETY TECHNOLOGIES, INC.
                    c/o WILLIAM B. HORNE
                    1800 CENTURY PARK EAST
                    SUITE 200
                    LOS ANGELES, CA 90067

                                       4
<PAGE>

                                    EXHIBIT C

                                     WARRANT

THIS WARRANT IS BEING ISSUED  TOGETHER WITH SHARES OF COMMON STOCK OF THE ISSUER
PURSUANT TO A  SUBSCRIPTION  AGREEMENT  WITH THE ISSUER  DATED AS OF JANUARY 26,
2007,  A COPY OF WHICH IS ON FILE WITH THE ISSUER.  NEITHER THIS WARRANT NOR THE
SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE  HEREOF HAVE BEEN  REGISTERED WITH
THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE
IN RELIANCE UPON AN EXEMPTION  FROM  REGISTRATION  UNDER THE  SECURITIES  ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), AND,  ACCORDINGLY,  MAY NOT BE OFFERED,
SOLD,  TRANSFERRED  OR  OTHERWISE  DISPOSED OF EXCEPT  PURSUANT TO AN  EFFECTIVE
REGISTRATION  STATEMENT  UNDER THE  SECURITIES  ACT OR PURSUANT TO AN  AVAILABLE
EXEMPTION  FROM,  OR  IN  A  TRANSACTION   NOT  SUBJECT  TO,  THE   REGISTRATION
REQUIREMENTS  OF THE  SECURITIES  ACT AND IN ACCORDANCE  WITH  APPLICABLE  STATE
SECURITIES  LAWS AS EVIDENCED BY AN OPINION OF COUNSEL TO THE TRANSFEROR TO SUCH
EFFECT, THE FORM AND SUBSTANCE OF WHICH SHALL BE ACCEPTABLE TO THE COMPANY.

                          COMMON STOCK PURCHASE WARRANT

                  To Purchase 300,000 Shares of Common Stock of

                       PATIENT SAFETY TECHNOLOGIES, INC.

         This certifies that, for value  received,  A Plus  Internation,  Inc. a
California corporation (the "Holder"),  is entitled,  upon the terms and subject
to the limitations on exercise and the conditions  hereinafter set forth, at any
time on or after the date hereof (the "INITIAL  EXERCISE  DATE") and on or prior
to the fifth (5th)  anniversary of the Initial  Exercise Date (the  "TERMINATION
DATE") but not  thereafter,  to subscribe for and purchase  from Patient  Safety
Technologies,  Inc.,  a  Delaware  corporation  (the  "ISSUER"),  up to  300,000
shares(1) (the "WARRANT  SHARES") of Common Stock,  par value $.33 per share, of
the Issuer (the "COMMON  STOCK").  The purchase price of each Warrant Share (the
"EXERCISE PRICE") under this Warrant shall be equal to $2.00. The Exercise Price
and the number of shares for which the Warrant is  exercisable  shall be subject
to adjustment as provided  herein.  This Warrant is being issued pursuant to the
terms and conditions of that certain  Subscription  Agreement,  dated as of even
date  herewith,  by and among the Issuer and the investors  listed  therein (the
"SUBSCRIPTION AGREEMENT").

         1.       CERTAIN DEFINITIONS.  Capitalized terms used but not otherwise
defined  herein  shall  have  the  meanings  set  forth  for  such  terms in the
Subscription  Agreement.  In  addition,  the  following  terms  shall  have  the
following respective meanings for purposes of this Warrant:

---------------------------
(1) Equals 37.5% of the number of Shares purchased by the Holder pursuant to the
    Subscription Agreement.

                                       1
<PAGE>

         (a)      "CLOSING  PRICE" means on any  particular  date:  (i) the last
reported  closing  bid  price  per  share of  Common  Stock on such  date on the
Exchange (as  reported by Bloomberg  L.P. at 4:15 p.m. New York time as the last
reported  closing bid price for regular  session  trading on such day);  (ii) if
there is no such closing bid price per share on such date, the closing bid price
on the  Exchange  on the  date  nearest  preceding  such  date (as  reported  by
Bloomberg  L.P. at 4:15 p.m.  New York time as the closing bid price for regular
session  trading on such day;  (iii) if the Common  Stock is not then  listed or
quoted on an Exchange  and if prices for the Common  Stock are then  reported in
the "pink  sheets"  published by Pink Sheets LLC (or a similar  organization  or
agency  succeeding  to its functions of reporting  prices),  the most recent bid
price per share of the Common Stock so reported; or (iv) if the shares of Common
Stock are not then publicly  traded,  the fair market value of a share of Common
Stock as determined in good faith by the Issuer's Board of Directors.

         (b)      "EXCHANGE"  means the following  markets or exchanges on which
the  Common  Stock is listed or quoted  for  trading  on a given  date:  (i) the
American  Stock  Exchange;  (ii) the New York Stock  Exchange;  (iii) the Nasdaq
National Market; or (iv) the Nasdaq SmallCap Market.

         (c)      "EXERCISE   PERIOD"  means  the  period  between  the  Initial
Exercise Date and the Termination Date.

         (d)      "TRADING  DAY" means:  (i) a day on which the Common  Stock is
traded on an Exchange;  (ii) if the Common Stock is not listed on an Exchange, a
day on which  the  Common  Stock is traded on the  over-the-counter  market,  as
reported by the OTC Bulletin  Board;  or (iii) if the Common Stock is not quoted
on the OTC  Bulletin  Board,  a day on which the  Common  Stock is quoted in the
over-the-counter  market  as  reported  by  Pink  Sheets  LLC  (or  any  similar
organization or agency succeeding its functions of reporting  prices);  PROVIDED
that in the event that the Common  Stock is not listed or quoted as set forth in
CLAUSE (I), (II) or (III) hereof, then Trading Day shall mean any Business Day.

         (e)      "WARRANT AGENT" means Transfer Online, Inc. in its capacity as
warrant  agent for the Issuer or, if it is no longer  serving in that  capacity,
such other Person, if any, that is then serving as Warrant Agent for the Issuer.

         2.       TITLE TO WARRANT.  At any time prior to the  Termination  Date
and  subject to  compliance  with  applicable  laws and the terms  hereof,  this
Warrant and all rights hereunder are  transferable,  in whole or in part, at the
office or agency of the  Issuer  (or any  Warrant  Agent for the  Issuer) by the
holder hereof in person or by duly authorized  attorney,  upon surrender of this
Warrant  together with the  Assignment  Form annexed hereto  properly  endorsed;
PROVIDED  that any  transferee  of this Warrant  shall,  upon the request of the
Issuer,  deliver to the Issuer:  (i) a written  opinion of legal counsel in form
and  substance  acceptable to the Issuer to the effect that such transfer may be
made without  registration  under the Securities Act or under  applicable  state
securities laws; (ii) an investment  representation letter in form and substance
acceptable to the Issuer;  and (iii) if the registration  rights with respect to
the Warrant Shares set forth in the Subscription Agreement are to be assigned to
such  transferee,  a notice of assignment and  agreement,  duly executed by such
transferee, to be bound by certain provisions of the

                                       2
<PAGE>

Subscription  Agreement,  as set forth in the Subscription  Agreement or in this
Warrant.

         3.       AUTHORIZATION OF SHARES.  The Issuer covenants that all shares
of Common  Stock that may be issued  upon the  exercise of the  purchase  rights
represented  by this  Warrant  will,  upon such  exercise,  be duly  authorized,
validly issued,  fully paid and nonassessable and free from all taxes, liens and
charges  in  respect of the issue  thereof  (other  than taxes in respect of any
transfer occurring contemporaneously with such issue).

         4.       EXERCISE OF WARRANT.

         (a)      This  Warrant may be  exercised,  in whole or in part,  at any
time or times during the Exercise Period, subject to SECTION 4(c).

         (b)      In order to effect the  exercise of this  Warrant,  the Holder
shall:  (i)  surrender  this  Warrant  and the Notice of Exercise  form  annexed
hereto,  duly  executed,  at the office of the  Issuer (or such other  office or
agency of the Issuer as it may designate by notice in writing to the  registered
holder  hereof  at the  address  of such  holder  appearing  on the books of the
Issuer);  (ii) remit  payment of the  aggregate  Exercise  Price for the Warrant
Shares  being  acquired by wire  transfer or  cashier's  check drawn on a United
States bank to the Issuer in accordance with the instructions of the Issuer; and
(iii) pay all taxes  required  to be paid by the  Holder,  if any,  pursuant  to
SECTION 6 hereof.  This Warrant shall be deemed to have been exercised,  and the
Holder shall be deemed to have become the holder of record of the Warrant Shares
for which this  Warrant has  exercised,  on the first date upon which the Holder
has complied with each of the conditions set forth in this SECTION 4(b).

         (c)      The Issuer  shall have the right to "call"  the  Warrant  (the
"WARRANT  CALL") and cause the Holder to exercise  this  Warrant with respect to
50% of the  Warrant  Shares  subject  hereto  in the  event  that,  at any  time
following the Initial Exercise Date: (i) any one of the following events occurs:
(A) a Registration  Statement  covering all the Warrant Shares issuable upon the
exercise of this Warrant has been filed and declared  effective,  or (B) all the
Warrant  Shares  then owned by the  Holder,  acting  independently  of all other
Holders,  are  eligible  for  sale  under  Rule  144,  or (C) the  second  (2nd)
anniversary  of the Initial  Exercise Date; AND (ii) after the occurrence of any
one of the events  listed in CLAUSE (I), the Closing  Price  exceeds 200% of the
Exercise Price for at least five (5)  consecutive  Trading Days (the  conditions
described in CLAUSES (I) and (II) being  collectively  referred to herein as the
"WARRANT CALL  CONDITIONS").  If the Issuer chooses to exercise the Warrant Call
at any time following the fulfillment of the Warrant Call  Conditions,  then the
Issuer shall deliver to the Holder written  notice (the "CALL  NOTICE")  stating
that Warrant Call  Conditions  have been  satisfied and specifying the number of
Warrant  Shares with  respect to which the  Warrant  must be  exercised.  Within
twenty (20)  Business Days of the delivery of the Call Notice to the Holder (the
"CALL  PERIOD"),  the Holder shall exercise this Warrant with respect to the 50%
of the Warrant Shares subject hereto in accordance  with the procedure set forth
in SECTION  4(b).  If the Holder  fails to timely pay the amount  required  upon
exercise of the Warrant Call, then the Issuer's sole remedy shall be to cancel a
corresponding portion (50%) of this Warrant,  which cancellation may be effected
by the Issuer in its sole  discretion and without  further written notice to the
Holder.  Notwithstanding the foregoing provisions of this SECTION 4(c), it shall
be a condition  to (i) the  Issuer's  exercise of the Warrant  Call and (ii) the
Holder's  obligation  to  exercise  this  Warrant  during the Call Period that a

                                       3
<PAGE>

Registration  Statement  covering  the Warrant  Shares be effective at all times
during the Call Period.

         (d)      Upon any proper  exercise of this Warrant in  accordance  with
SECTION 4(b), the Holder shall be entitled to promptly receive a certificate for
the number of Warrant Shares acquired in connection with such exercise.

         (e)      If this Warrant shall have been  exercised in part, the Issuer
shall, at the time of delivery of the  certificate or certificates  representing
Warrant Shares,  deliver to Holder a new Warrant evidencing the rights of Holder
to acquire the  remaining  Warrant  Shares  subject to this  Warrant,  which new
Warrant shall in all other respects be identical with this Warrant.

         5.       NO FRACTIONAL SHARES OR SCRIP. No fractional Warrant Shares or
scrip  representing  fractional Warrant Shares shall be issued upon the exercise
of this  Warrant.  As to any  fraction  of a Warrant  Share which  Holder  would
otherwise be entitled to acquire upon such exercise, the Issuer shall pay a cash
adjustment in respect of such final fraction in an amount equal to such fraction
multiplied by the Exercise Price.

         6.       CHARGES,  TAXES AND  EXPENSES.  Issuance of  certificates  for
Warrant  Shares  issued upon the exercise of this Warrant  shall be made without
charge to the Holder for any issue or transfer tax or other  incidental  expense
in respect of the issuance of such certificate,  all of which taxes and expenses
shall be paid by the Issuer,  and such certificates  shall be issued in the name
of the  Holder  or in such  name or  names  as may be  directed  by the  Holder;
PROVIDED that in the event certificates for Warrant Shares are to be issued in a
name other  than the name of the  Holder of this  Warrant,  this  Warrant,  when
surrendered  for exercise,  shall be accompanied by the Assignment Form attached
hereto duly executed by the Holder;  and the Issuer may require,  as a condition
thereto,  the payment of a sum  sufficient  to reimburse it for any transfer tax
incidental thereto.

         7.       CLOSING OF BOOKS.  The Issuer  will not close its  stockholder
books or records in any  manner  which  prevents  the  timely  exercise  of this
Warrant pursuant to the terms hereof.

         8.       NO RIGHTS AS STOCKHOLDER UNTIL EXERCISE. This Warrant does not
entitle the Holder to any voting rights or other rights as a stockholder  of the
Issuer prior to the exercise hereof in accordance with SECTION 4 hereof.

         9.       LOSS, THEFT,  DESTRUCTION OR MUTILATION OF WARRANT. The Issuer
covenants that upon receipt by the Issuer of evidence reasonably satisfactory to
it of the loss, theft,  destruction or mutilation of this Warrant certificate or
any stock certificate relating to the Warrant Shares, and in case of loss, theft
or destruction,  of indemnity or security  reasonably  satisfactory to it (which
shall not include the posting of any bond),  and upon surrender and cancellation
of such Warrant or stock  certificate,  if  mutilated,  the Issuer will make and
deliver a new  Warrant or stock  certificate  of like tenor and dated as of such
cancellation, in lieu of such Warrant or stock certificate.

                                       4
<PAGE>

         10.      SATURDAYS,  SUNDAYS,  HOLIDAYS,  ETC. If the last or appointed
day for the  taking of any action or the  expiration  of any right  required  or
granted  herein  shall not be a Business  Day,  then such action may be taken or
such right may be exercised on the next succeeding Business Day.

         11.      ADJUSTMENTS  OF EXERCISE  PRICE AND NUMBER OF WARRANT  SHARES.
The number and kind of securities  purchasable upon the exercise of this Warrant
and the Exercise  Price shall be subject to adjustment  from time to time in the
event that the Issuer  shall:  (i) pay a dividend  in shares of Common  Stock or
make a  distribution  in shares of Common  Stock to holders  of its  outstanding
Common  Stock;  (ii)  subdivide  its  outstanding  shares of Common Stock into a
greater number of shares of Common Stock;  (iii) combine its outstanding  shares
of Common Stock into a smaller  number of shares of Common Stock;  or (iv) issue
any  shares of its  capital  stock in a  reclassification  of the  Common  Stock
(including,  without  limitation,  any  spin-off  of any  subsidiary).  Upon the
occurrence  of any such event,  the number of Warrant  Shares  purchasable  upon
exercise of this Warrant immediately prior thereto shall be adjusted so that the
Holder  shall be entitled  to receive  the kind and number of Warrant  Shares or
other  securities  of the Issuer which such Holder would have owned or have been
entitled to receive had such  Warrant  been  exercised in advance of such event.
Upon each such  adjustment  of the kind and  number of  Warrant  Shares or other
securities  of the Issuer  which are  purchasable  hereunder,  the Holder  shall
thereafter  be  entitled  to  purchase  the  number of  Warrant  Shares or other
securities resulting from such adjustment at an Exercise Price per Warrant Share
or  other  security  obtained  by  multiplying  the  Exercise  Price  in  effect
immediately prior to such adjustment by the number of Warrant Shares purchasable
pursuant hereto  immediately prior to such adjustment and dividing the result by
the number of Warrant  Shares or other  securities of the Issuer  resulting from
such  adjustment.  An  adjustment  made pursuant to this SECTION 11 shall become
effective  immediately after the effective date of such event retroactive to the
record date, if any, for such event.

         12.      RECLASSIFICATION,  REORGANIZATION,  CONSOLIDATION,  MERGER AND
SALE  OF   ASSETS.   In  the  event  of:  (i)  any   reclassification,   capital
reorganization,  or  change in the  Common  Stock  (other  than as a result of a
subdivision,  combination,  stock dividend or other transaction  provided for in
SECTION 11 above); (ii) any share exchange, merger or similar transaction of the
Issuer  with or into  another  person or entity  (other  than a share  exchange,
merger or similar  transaction in which the Issuer is the acquiring or surviving
corporation  and which does not result in any change in the Common  Stock  other
than the  issuance of  additional  shares of Common  Stock);  or (iii) the sale,
exchange,  lease,  transfer or other disposition of all or substantially all the
properties  and  assets  of the  Issuer  as an  entirety  (in any such  case,  a
"REORGANIZATION  EVENT"),  then,  as a condition of such  Reorganization  Event,
lawful provisions shall be made, and duly executed documents evidencing the same
from the Issuer or its successor  shall be delivered to the Holder,  so that the
Holder shall have the right at any time prior to the  expiration of this Warrant
to purchase, at a total price equal to the aggregate Exercise Price then payable
upon the  exercise of this  Warrant,  the kind and amount of shares of stock and
other securities and property  receivable in connection with such Reorganization
Event  by a  holder  of the  same  number  of  shares  of  Common  Stock as were
purchasable by the Holder immediately prior to such Reorganization Event. In any
such case  appropriate  provisions  shall be made with respect to the rights and
interests  of the  Holder so that the  provisions  hereof  shall  thereafter  be
applicable with respect to any shares of stock or other  securities and property
deliverable upon exercise hereof, at the same

                                       5
<PAGE>

aggregate purchase price as is then payable hereunder.

         13.      VOLUNTARY ADJUSTMENT BY THE ISSUER.  Subject to any applicable
Requirements  of Law,  the Issuer may at any time  during  the  Exercise  Period
reduce the then-current  Exercise Price to any amount and for any period of time
deemed appropriate by the Board of Directors of the Issuer.

         14.      NOTICE OF ADJUSTMENT. Whenever the number of Warrant Shares or
number or kind of securities or other property  purchasable upon the exercise of
this Warrant or the Exercise  Price is adjusted as herein  provided,  the Issuer
shall promptly mail by registered or certified mail,  return receipt  requested,
to the Holder notice of such adjustment or adjustments  setting forth the number
of Warrant  Shares  (and other  securities  or  property)  purchasable  upon the
exercise of this Warrant and the  Exercise  Pri ce of such  Warrant  Shares (and
other  securities  or property)  after such  adjustment,  setting  forth a brief
statement  of  the  facts  requiring  such  adjustment  and  setting  forth  the
computation by which such  adjustment was made.  Such notice,  in the absence of
manifest  error,  shall  be  conclusive  evidence  of the  correctness  of  such
adjustment.

         15.      NOTICES  OF RECORD  DATE.  In the  event of any  taking by the
Issuer of a record of the holders of Common Stock for the purpose of determining
the holders  thereof who are entitled to receive any dividend (other than a cash
dividend which is the same as cash dividends paid in previous quarters) or other
distribution in respect of shares of Common Stock,  the Issuer shall mail to the
Holder,  at least ten (10) days prior to such record date,  a notice  specifying
the date on which  any  such  record  is to be  taken  for the  purpose  of such
dividend or distribution.

         16.      NO IMPAIRMENT.  The Issuer shall not by any action, including,
without  limitation,  amending its Certificate of  Incorporation  or through any
Reorganization  Event or any other voluntary action,  avoid or seek to avoid the
observance or performance  of any of the terms of this Warrant,  but will at all
times in good  faith  assist in the  carrying  out of all such  terms and in the
taking of all such  actions as may be necessary  or  appropriate  to protect the
rights of Holder against impairment.

         17.      MISCELLANEOUS.

         (a)      Any term of this Warrant may be amended and the  observance of
any term of this  Warrant may be waived  (either  generally  or in a  particular
instance  and either  retroactively  or  prospectively),  only with the  written
consent of the Issuer and the Holder.

         (b)      Any notice, request or other document required or permitted to
be given or delivered to the Holder or the Issuer shall be delivered or shall be
sent by certified mail,  postage prepaid,  to the Holder at its address as shown
on the books of the  Issuer or to the  Issuer  at the  address  set forth in the
Subscription  Agreement  or such  other  address as either may from time to time
provide to the other.

         (c)      This Warrant shall be binding upon any corporation  succeeding
the Issuer by merger,  consolidation or acquisition of all or substantially  all
the Issuer's assets. All the obligations of

                                       6
<PAGE>

the Issuer and the Holder  relating  to the  Warrant  Shares  issuable  upon the
exercise of this Warrant  shall  survive the exercise  and  termination  of this
Warrant.  All the  covenants  and  agreements of the Issuer and the Holder shall
inure to the benefit of the successors and assigns of the Holder and the Issuer,
respectively.

         (d)      The   description   headings  of  the  several   sections  and
paragraphs  of  this  Warrant  are  inserted  for  convenience  only  and do not
constitute a part of this Warrant.  This Warrant shall be construed and enforced
in accordance with, and the rights of the parties shall be governed by, the laws
of the State of California.

         (e)      Wherever  possible,  each  provision of this Warrant  shall be
interpreted  in such manner as to be effective and valid under  applicable  law,
but if any  provision of this Warrant  shall be  prohibited  by or invalid under
applicable  law,  such  provision  shall be  ineffective  to the  extent of such
prohibition or invalidity, without invalidating the remainder of such provisions
or the remaining provisions of this Warrant.

                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

                                       7
<PAGE>

         IN WITNESS  WHEREOF,  each of the Issuer and the Holder has caused this
Warrant to be executed as of the date set forth below.

Dated: As of January 26, 2007
                                     ISSUER:

                                     PATIENT SAFETY TECHNOLOGIES, INC.

                                     By:   _____________________________________
                                           William B. Horne
                                           Chief Executive Officer

                                     HOLDER:

                                     ________________________________________

                                     By:   _____________________________________

                                     Name: _____________________________________

                                     Title: ____________________________________

COUNTERSIGNED BY:

TRANSFER ONLINE, INC., AS WARRANT AGENT

By:_____________________________________

                                       8
<PAGE>

                               NOTICE OF EXERCISE

             (To be executed and submitted, along with the Warrant)

To:      Transfer Online, Inc.
         317 SW Alder Street, Second Floor
         Portland, Oregon  97204
         Facsimile: (503) 227-6874
         Attention:  Bryan Cochran

                  (1)      The  undersigned  hereby  elects to  purchase  (check
                           applicable box):

                           |_|      all of the shares of Common Stock of Patient
                                    Safety   Technologies,   Inc.  (the  "COMMON
                                    STOCK") covered by the attached Warrant; or

                           |_|      ______________   shares  of   Common   Stock
                                    covered by the attached Warrant.

                  The undersigned tenders herewith payment of the exercise price
         for such shares in full,  together with all applicable  transfer taxes,
         if any, as provided in the attached Warrant, which is $__________. Such
         payment takes the form of (check applicable box):

                           |_|      $__________  in lawful  money of the  United
                                    States by

                                    |_|      wire transfer to the Issuer

                                    |_|      cashier's check to the Issuer

                  (2)      Please   issue   a   certificate   or    certificates
representing  such shares of Common Stock in the name of the  undersigned  or in
such other name as is specified below:

                           ____________________________
                           (Name)

                           ____________________________
                           (Address)

                           ____________________________

          The  undersigned  represents and warrants that all offers and sales by
the  undersigned of the securities  issuable upon exercise of the within Warrant
shall be made pursuant to  registration of the Common Stock under the Securities
Act of 1933, as amended (the "SECURITIES ACT"), or pursuant to an exemption from
registration under the Securities Act.

Dated: _________________                          ______________________________
                                                  Signature

<PAGE>

                                 ASSIGNMENT FORM

                    (To assign the foregoing Warrant, execute
                   this form and supply required information.
                 Do not use this form to exercise the Warrant.)

   FOR VALUE RECEIVED,  the foregoing Warrant and all rights evidenced  thereby,
including  the  registration  rights set forth  therein  or in the  Subscription
Agreement that accompanied the form of warrant (the ("Subscription  Agreement"),
are  hereby  assigned  to  __________________________________  whose  address is
_________________________________________________________.

Dated:  ______________, _______

                 Holder's Signature:  _____________________________

                 Holder's Address:    _____________________________

                                      _____________________________

Signature Guaranteed:  _________________________________________

NOTE: The signature to this  Assignment Form must correspond with the name as it
appears on the face of the Warrant,  without  alteration or  enlargement  or any
change whatsoever,  and must be guaranteed by a bank or trust company.  Officers
of corporations and those acting in a fiduciary or other representative capacity
should file proper evidence of authority to assign the foregoing Warrant.

Agreement of Assignee:

I hereby agree to be bound by the terms of the Subscription  Agreement including
sections 4, 5 and 6 thereof.

Dated:  ______________, _______

                 Assignee's Signature:     _____________________________

                 Assignee's Address:       _____________________________

                                           _____________________________

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