RETURN TO TREASURY AGREEMENT
THIS AGREEMENT is made as of the 14th day
of December, 2005
BETWEEN:
IPEX, INC., a
corporation formed
pursuant to the laws of the State
of Nevada and having an office for business located at 9255 Towne
Centre Drive, San Diego, CA 92121
(the "Company")
AND:
WOLFGANG GRABHER,
an individual
having an address
located at 7932
Prospect Place, La Jolla, CA 92037
(the
"Shareholder").
WHEREAS:
A. The Shareholder is the registered and
beneficial owner of
18,855,900 shares
of the Company's common stock.
B. The Shareholder has previously agreed to transfer 500,000 shares of the
Company's common stock to Patient Safety Technologies, Inc., a Delaware
corporation.
C. The Shareholder was previously an officer and member of the Board of
Directors of the Company.
D. The Company and the Shareholder
intend for the
Shareholder to return certain
of his shares of Company common stock to
the treasury of the Company.
NOW THEREFORE THIS AGREEMENT WITNESSETH THAT in consideration of the premises
and sum of $1.00 now paid by the
Company to the
Shareholder,
the receipt and
sufficiency whereof is hereby acknowledged, the parties hereto hereby agree
as
follows:
Surrender of Shares
1. The Shareholder hereby surrenders to the Company
14,855,900
shares of the
Company's common stock (the "Surrendered Shares"), which includes 1,936,728
shares of the Company's common stock currently held in escrow
pursuant to the
RGB Escrow Agreement (defined in Section 11
of this Agreement), by delivering to
the Company a share certificate or certificates representing the Surrendered
Shares, duly endorsed for transfer in
blank, signatures
medallion guaranteed.
The Shareholder shall deliver the Surrendered
Shares to the Company
within ten
(10) business days of the date of this Agreement for the sole purpose of
retiring the Surrendered Shares.
2. In addition to the Surrendered
Shares, the
Shareholder hereby agrees 500,000
of the Company's common stock (the "Holdback
Shares") are subject
to surrender
to the Company as follows:
(a) In the event that all of the conditions set forth in Schedule
A
hereto are not
satisfied within
twelve (12) months of
the date of
this Agreement, then the Company
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2
shall have the right to receive 125,000 of the Holdback Shares.
(b) In the event that
the Company
does not enter into a license
agreement relating to
the RGB Assets
(defined in Schedule A) which
generates revenue for the Company within twelve (12) months from
the
date of this
Agreement, then the
Company shall have the right to
receive 125,000 of the Holdback Shares.
(c) In the event that
the Company
does not file at least
five (5)
patent applications
relating to the RGB Assets (defined in Schedule
A) within twelve (12) months from the date of this Agreement, then
the Company shall have the right to receive 125,000 of the Holdback
Shares.
(d) In the event that the Company does not generate revenue of at
least three million dollars ($3,000,000) (calculated in accordance
with generally accepted accounting principles in the United
States)
derived from the RGB
Assets (defined in Schedule A) within the
twenty-four (24) months following the date of this
Agreement, then
the Company shall have the right to receive 125,000 of the Holdback
Shares.
3. The Company shall use reasonable
commercial efforts to
facilitate
achieving
each of the milestones described in Section 2. If at any time during the
twenty-four (24) months following the date of this
Agreement, the
Shareholder
believes the Company has not used
reasonable
commercial
efforts to
facilitate
achieving any of the milestones described in Section 2 solely as
it relates to
Holdback Shares that have not been
surrendered to the
Company (or cash paid in
lieu of surrendering such Holdback Shares pursuant to Section 5 of this
Agreement), then the Shareholder shall deliver
written notice of such belief to
the Company's Board of Directors ("Board").
Such written notice shall specify in
reasonable detail the facts and circumstances giving rise to such belief,
together with any documented evidence of
the basis for the Shareholder's belief.
After receipt of such notice, the Board shall have thirty (30)
calendar days to
remedy the allegations described in the written notice to the Shareholder's
satisfaction. If the Company does not remedy any such allegations to the
Shareholder's satisfaction, then the
Company and the Shareholder agree to submit
disputes between them relating to Section 2
to arbitration as
follows. If the
Shareholder fails to provide written notice to
the Company as described above,
recovery on the Shareholder's dispute will be barred. Arbitration will be
conducted in San Diego County, California pursuant to the Commercial
Rules of
the American Arbitration Association ("AAA"), as modified herein. The
arbitration shall be conducted by one (1)
arbitrator chosen in
accordance with
the rules of the AAA. Unless the arbitrator
finds that exceptional circumstances
require otherwise, the arbitrator will
grant the prevailing party in arbitration
its costs of arbitration and reasonable attorneys' fees as part of the
arbitration award. Either party will be entitled to receive in any court of
competent jurisdiction injunctive, preliminary or other equitable
relief, in
addition to damages, including court costs and fees of attorneys and other
professionals, to remedy any actual or threatened
violation of its
rights with
respect to which arbitration is not
required hereunder.
The parties incorporate
the provisions of California Code of Civil
Procedure Section 1283.05 into this
Agreement and make those provisions part of and applicable to any
arbitration
arising under this Agreement.
4. The Shareholder hereby grants the
Company a second priority security interest
in the Holdback Shares to secure the Shareholder's obligations pursuant to
Section 2 of this Agreement. The Shareholder hereby agrees to execute and
deliver to the Company such additional agreements and documents reasonably
necessary or advisable to accomplish the
purposes of this Section 4.
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