-----BEGIN PRIVACY-ENHANCED MESSAGE-----
Proc-Type: 2001,MIC-CLEAR
Originator-Name: webmaster@www.sec.gov
Originator-Key-Asymmetric:
 MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen
 TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB
MIC-Info: RSA-MD5,RSA,
 CA8soRa2bOxeVQj0uN58w0HsQc+41YtMZe6Vz5wxaq4qLMXN/MUxhKV4FKkzNEUd
 iNm5y2cZzVAsAcTOrReVlQ==

<SEC-DOCUMENT>0001003297-05-000345.txt : 20051102
<SEC-HEADER>0001003297-05-000345.hdr.sgml : 20051102
<ACCEPTANCE-DATETIME>20051102090437
ACCESSION NUMBER:		0001003297-05-000345
CONFORMED SUBMISSION TYPE:	8-K
PUBLIC DOCUMENT COUNT:		6
CONFORMED PERIOD OF REPORT:	20051031
ITEM INFORMATION:		Entry into a Material Definitive Agreement
ITEM INFORMATION:		Financial Statements and Exhibits
FILED AS OF DATE:		20051102
DATE AS OF CHANGE:		20051102

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			PRO DEX INC
		CENTRAL INDEX KEY:			0000788920
		STANDARD INDUSTRIAL CLASSIFICATION:	SURGICAL & MEDICAL INSTRUMENTS & APPARATUS [3841]
		IRS NUMBER:				841261240
		STATE OF INCORPORATION:			CO
		FISCAL YEAR END:			0630

	FILING VALUES:
		FORM TYPE:		8-K
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	000-14942
		FILM NUMBER:		051171506

	BUSINESS ADDRESS:	
		STREET 1:		MICRO MOTORS, INC.
		STREET 2:		151 EAST COLUMBINE
		CITY:			SANTA ANA
		STATE:			CA
		ZIP:			92707
		BUSINESS PHONE:		714-241-4411

	MAIL ADDRESS:	
		STREET 1:		MICRO MOTORS INC.
		STREET 2:		151 EAST COLUMBINE
		CITY:			SANTA ANA
		STATE:			CA
		ZIP:			92707
</SEC-HEADER>
<DOCUMENT>
<TYPE>8-K
<SEQUENCE>1
<FILENAME>pdex8k1.htm
<TEXT>
<html>

<head>


<title>Pro-Dex, Inc.Form 8-K by edgar2.com</title>



</head>

<body lang=EN-US link=blue vlink=purple>



<p><b>&nbsp;</b></p>









<p align="center"><b>UNITED STATES<br>
SECURITIES AND EXCHANGE COMMISSION<br>
Washington</b><b>,
 D.C.</b><b>&nbsp; 20549</b></p>





<p align=center style='text-align:center'><b>FORM 8-K</b></p>

<p align="center"><b>CURRENT REPORT<br>
Pursuant to Section 13 or 15(d) of the<br>
Securities Exchange Act of 1934</b></p>





<p align=center style='text-align:center'>Date of Report <br>
<font size="2">(Date of earliest event reported)</font><b><font size="2"> <br>
</font>October 31, 2005</b></p>





<p align=center style='text-align:center'><b><font size="4">PRO-DEX, INC.<br>
</font></b><font size="2">(Exact name of registrant as specified in its charter)</font></p>
<div align="center">
	<table border="0" width="740" id="table1">
		<tr>
			<td width="221" align="center">





<p align=center style='text-align:center'><b>COLORADO</b></p></td>
			<td align="center" width="275"><b>0-14942</b></td>
			<td align="center"><b>84-1261240</b></td>
		</tr>
		<tr>
			<td width="221" align="center"><font size="2">(State or other</font></td>
			<td align="center" width="275"><font size="2">(Commission File
			Number)</font></td>
			<td align="center"><font size="2">(IRS
Employer </font></td>
		</tr>
		<tr>
			<td width="221" align="center"><font size="2">jurisdiction of</font></td>
			<td align="center" width="275">&nbsp;</td>
			<td align="center"><font size="2">Identification Number)</font></td>
		</tr>
		<tr>
			<td width="221" align="center"><font size="2">incorporation)</font></td>
			<td align="center" width="275">&nbsp;</td>
			<td align="center">&nbsp;</td>
		</tr>
	</table>
</div>

<p align=center style='text-align:center'><b>151 East Columbine Avenue<br>
Santa Ana</b><b>, California </b><b>92707<br>
</b><font size="2">(Address of Principal Executive Offices)</font></p>

<p align=center style='text-align:center'><b>(714) 241-4411<br>
</b><font size="2">(Registrant's Telephone Number, Including Area Code)</font></p>





<p style='text-autospace:none'>Check the appropriate box below
if the Form 8-K filing is intended to simultaneously satisfy the filing
obligation of the registrant under any of the following provisions ( <i>see </i>General
Instruction A.2. below): </p>



<p style='text-autospace:none; margin-top:0; margin-bottom:0.001pt'>[&nbsp;&nbsp; ] &nbsp;Written
communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) </p>

<p style='text-autospace:none; margin-top:0; margin-bottom:0.001pt'>[&nbsp;&nbsp; ] &nbsp;Soliciting material
pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) </p>

<p style='margin-left:20.0pt;text-indent:-20.0pt;text-autospace:
none; margin-top:0; margin-bottom:0.001pt'>[&nbsp;&nbsp; ] &nbsp;Pre-commencement communications pursuant to Rule 14d-2(b)
under the Exchange Act (17 CFR 240.14d-2(b)) </p>

<p style='text-autospace:none; margin-top:0; margin-bottom:0.001pt'>[&nbsp;&nbsp; ] &nbsp;Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c)) </p>
<p style='text-autospace:none; margin-top:0; margin-bottom:0.001pt'>&nbsp;</p>
<p style='text-autospace:none; margin-top:0; margin-bottom:0.001pt'>&nbsp;</p>
<p style='text-autospace:none; margin-top:0; margin-bottom:0.001pt'>&nbsp;</p>



<div class=MsoNormal align=center style='text-align:center'>

<hr size=2 width="100%" noshade color=navy align=center>

</div>





<b><u><br
clear=all style='page-break-before:always'>
</u></b>













<p style='margin-left:108.0pt;text-indent:-108.0pt'><b>Item 1.01&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Entry into a Material
Definitive Agreement</b></p>

<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; On October
31, 2005, Pro-Dex, Inc. (the &quot;Company&quot;) entered into an Asset Purchase
Agreement (the &quot;Purchase Agreement&quot;) with IntraVantage, Inc., a Delaware
corporation (&quot;IntraVantage&quot;), whereby the Company purchased from IntraVantage
certain of IntraVantage's assets related to IntraVantage's dental products
business, including all of IntraVantage's intellectual property rights (the
&quot;Intellectual Property&quot; and, collectively with the other purchased assets, the
&quot;Assets&quot;).&nbsp; The purchase price for the Assets comprised of the following
consideration:</p>



<ul style='margin-top:0pt' type=disc>
 <li class=MsoNormal>$226,087 in cash paid to
     IntraVantage on October 31, 2005;</li>
 <li class=MsoNormal style='margin-top:12.0pt'>$893,271
     in cash paid to IntraVantage's bank on October 31, 2005 as full payoff and
     release of all of IntraVantage's credit obligations with such bank; and</li>
 <li class=MsoNormal style='margin-top:12.0pt'>$400,000
     in cash payable to IntraVantage in annual installments of $100,000 on each
     of October 31, 2006, 2007, 2008 and 2009.</li>
</ul>

<p style='margin-top:12.0pt;text-indent:35.0pt'>As further inducement for IntraVantage to enter into
the Purchase Agreement, Pro-Dex also entered into an Exclusive License
Agreement and a Royalty Agreement with IntraVantage in conjunction with the
October 31, 2005 closing of the Purchase Agreement.&nbsp; The Exclusive License
Agreement grants to IntraVantage an exclusive, worldwide, irrevocable,
royalty-free and perpetual license to use the Intellectual Property in any
non-dental related field of use.&nbsp; The Royalty Agreement requires that the
Company pay to IntraVantage certain royalty payments on revenues generated from
future sales of products by the Company which fall within the scope of,
incorporate, are a modification of or are substantially derived from one or
more of the patents included in the Intellectual Property.</p>



<p style='margin-left:0pt;text-indent:0pt'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Also
in conjunction with the closing of the Purchase Agreement, the Company agreed
to terminate a supply agreement between the Company and IntraVantage, along
with all amendments thereto. Pursuant to this termination, IntraVantage shall
return to the Company certain products previously delivered to IntraVantage
under the supply agreement in exchange for the Company issuing to IntraVantage
a credit memo equal to the full value of outstanding IntraVantage invoices
related to the supply agreement.</p>



<p style='margin-left:0pt;text-indent:0pt'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; On
November 2, the Company issued a press release announcing the Purchase
Agreement and the other agreements entered into in conjunction therewith.&nbsp; A
copy of the press release is attached hereto as Exhibit 99.1 and incorporated
herein by reference.</p>



<p style='margin-left:0pt;text-indent:0pt'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; The
foregoing descriptions of the agreements set forth above and included in the
above referenced press release do not purport to be a complete description of
all of the terms of such agreements, and are qualified in their entirety by
reference to the full terms of the Purchase Agreement, Exclusive License
Agreement and Royalty Agreement, copies of which are attached hereto as
Exhibits 10.1, 10.2 and 10.3, respectively, and incorporated herein by
reference.</p>
<p style='margin-left:0pt;text-indent:0pt'>&nbsp;</p>
<p style='margin-left:0pt;text-indent:0pt' align="center">2</p>



<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=624
 style='width:468.0pt;border-collapse:collapse'>
 <tr>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=120 valign=bottom style='width:90.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>

  &nbsp;</td>
 </tr>
</table>



<div class=MsoNormal align=center style='text-align:center'>

<hr size=2 width="100%" noshade color=navy align=center>

</div>



<br clear=all
style='page-break-before:always'>










<p><b><u>Item 9.01</u></b><b>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <u>Exhibits</u></b></p>

<p>&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Exhibits.</p>

<p style='margin-top:12.0pt;margin-right:0pt;
margin-bottom:0pt;margin-left:0pt;margin-bottom:.0001pt;text-indent:36.0pt'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <u>Exhibit
No.</u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <u>Description</u></p>

<p style='margin-top:12.0pt;margin-right:0pt;
margin-bottom:0pt;margin-left:144.0pt;margin-bottom:.0001pt;text-indent:-72.0pt'>
<font size="2">Exhibit
10.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Asset Purchase Agreement, dated October 31, 2005, between Pro-Dex,
Inc. and IntraVantage, Inc.</font></p>

<p style='margin-top:12.0pt;margin-right:0pt;
margin-bottom:0pt;margin-left:144.0pt;margin-bottom:.0001pt;text-indent:-72.0pt'>
<font size="2">Exhibit
10.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Exclusive License Agreement, dated October 31, 2005, between Pro-Dex,
Inc. and IntraVantage, Inc.</font></p>

<p style='margin-top:12.0pt;margin-right:0pt;
margin-bottom:0pt;margin-left:144.0pt;margin-bottom:.0001pt;text-indent:-72.0pt'>
<font size="2">Exhibit
10.3&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Royalty Agreement, dated October 31, 2005, between Pro-Dex, Inc. and
IntraVantage, Inc.</font></p>

<p style='margin-top:12.0pt;margin-right:0pt;
margin-bottom:0pt;margin-left:36.0pt;margin-bottom:.0001pt;text-indent:36.0pt'>
<font size="2">Exhibit
99.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Press Release dated November 2, 2005</font></p>
<p style='margin-top:12.0pt;margin-right:0pt;
margin-bottom:0pt;margin-left:36.0pt;margin-bottom:.0001pt;text-indent:36.0pt'>&nbsp;</p>
<p style='margin-top:12.0pt;margin-right:0pt;
margin-bottom:0pt;margin-left:36.0pt;margin-bottom:.0001pt;text-indent:36.0pt'>&nbsp;</p>
<p style='margin-top:12.0pt;margin-right:0pt;
margin-bottom:0pt;margin-left:36.0pt;margin-bottom:.0001pt;text-indent:36.0pt'>&nbsp;</p>
<p style='margin-top:12.0pt;margin-right:0pt;
margin-bottom:0pt;margin-left:36.0pt;margin-bottom:.0001pt;text-indent:36.0pt'>&nbsp;</p>
<p style='margin-top:12.0pt;margin-right:0pt;
margin-bottom:0pt;margin-left:36.0pt;margin-bottom:.0001pt;text-indent:36.0pt'>&nbsp;</p>
<p style='margin-top:12.0pt;margin-right:0pt;
margin-bottom:0pt;margin-left:36.0pt;margin-bottom:.0001pt;' align="center">3</p>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=624
 style='width:468.0pt;border-collapse:collapse'>
 <tr>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=120 valign=bottom style='width:90.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>

  &nbsp;</td>
 </tr>
</table>



<div class=MsoNormal align=center style='text-align:center'>

<hr size=2 width="100%" noshade color=navy align=center>

</div>



<br clear=all
style='page-break-before:always'>










<p align=center style='text-align:center'><b>SIGNATURES</b></p>





<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Pursuant to the requirements of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed
on its behalf by the undersigned hereunto duly authorized.</p>





<p>Date:&nbsp; November 1, 2005&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <b>PRO-DEX, INC.</b></p>





<p style='margin-left:234.0pt'>By:
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <u>/s/&nbsp; Patrick Johnson&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<br>
</u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Patrick Johnson<br>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Chief Executive Officer</p>

<p>&nbsp;</p>
<p>&nbsp;</p>
<p>&nbsp;</p>
<p>&nbsp;</p>
<p>&nbsp;</p>
<p align="center">4</p>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=624
 style='width:468.0pt;border-collapse:collapse'>
 <tr>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=120 valign=bottom style='width:90.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>

  &nbsp;</td>
 </tr>
</table>



<div class=MsoNormal align=center style='text-align:center'>

<hr size=2 width="100%" noshade color=navy align=center>

</div>



<br clear=all
style='page-break-before:always'>










<p align=center style='text-align:center'><b>INDEX TO EXHIBITS</b></p>

<p><b>&nbsp;</b></p>

<p><b>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </b></p>

<p><b>&nbsp;&nbsp;  Exhibit<br>
<u>&nbsp; Number&nbsp; </u></b><b>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <u>Description&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </u></b>
</p>



<p style='margin-left:72.0pt;text-indent:-54.0pt'><font size="2">10.1 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Asset
Purchase Agreement, dated October 31, 2005, between Pro-Dex, Inc. and
IntraVantage, Inc.</font></p>

<p style='margin-top:12.0pt;margin-right:0pt;margin-bottom:
0pt;margin-left:72.0pt;margin-bottom:.0001pt;text-indent:-54.0pt'>
<font size="2">10.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Exclusive
License Agreement, dated October 31, 2005, between Pro-Dex, Inc. and
IntraVantage, Inc.</font></p>

<p style='margin-top:12.0pt;margin-right:0pt;margin-bottom:
0pt;margin-left:72.0pt;margin-bottom:.0001pt;text-indent:-54.0pt'>
<font size="2">10.3&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Royalty
Agreement, dated October 31, 2005, between Pro-Dex, Inc. and IntraVantage, Inc.</font></p>

<p style='margin-top:12.0pt;margin-right:0pt;margin-bottom:
0pt;margin-left:72.0pt;margin-bottom:.0001pt;text-indent:-54.0pt'>
<font size="2">99.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Press
Release dated November 2, 2005</font></p>
<p style='margin-top:12.0pt;margin-right:0pt;margin-bottom:
0pt;margin-left:72.0pt;margin-bottom:.0001pt;text-indent:-54.0pt'>&nbsp;</p>
<p style='margin-top:12.0pt;margin-right:0pt;margin-bottom:
0pt;margin-left:72.0pt;margin-bottom:.0001pt;text-indent:-54.0pt'>&nbsp;</p>
<p style='margin-top:12.0pt;margin-right:0pt;margin-bottom:
0pt;margin-left:72.0pt;margin-bottom:.0001pt;text-indent:-54.0pt'>&nbsp;</p>
<p style='margin-top:12.0pt;margin-right:0pt;margin-bottom:
0pt;margin-left:72.0pt;margin-bottom:.0001pt;text-indent:-54.0pt'>&nbsp;</p>
<p style='margin-top:12.0pt;margin-right:0pt;margin-bottom:
0pt;margin-left:72.0pt;margin-bottom:.0001pt;text-indent:-54.0pt'>&nbsp;</p>
<p style='margin-top:12.0pt;margin-right:0pt;margin-bottom:
0pt;margin-bottom:.0001pt;' align="center">5</p>



<div class=MsoNormal align=center style='text-align:center'>

<hr size=2 width="100%" noshade color=navy align=center>

</div>







</body>

</html>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.1
<SEQUENCE>2
<FILENAME>ex991.htm
<TEXT>
<html>

<head>


<title>Exhibit 99.1</title>


</head>

<body lang=EN-US link=blue vlink=purple>















<p align=left style='text-align:left;line-height:normal'><img
width=175 height=77 src="image001.jpg">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </p>

<div align="left">
	<table border="0" width="740" id="table1">
		<tr>
			<td valign="top">
			<p align="right">Contact:&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</td>
			<td valign="top" width="390">

<p align=left style='text-align:left;line-height:
normal'>Patrick
Johnson, President &amp; CEO<br>
(714)
241-4411<br>
Matthew
Hayden, Investor Relations<br>
Hayden
Communications, Inc.<br>
(858)
704 - 5065</p></td>
		</tr>
	</table>
</div>

<p style='text-align:justify'><b><i>For
Immediate Release</i></b>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </p>

<p align="center"><b>PRO-DEX, INC. ANNOUNCES THE ACQUISITION OF<i> </i>INNOVATIVE
TECHNOLOGY IN DENTAL ANESTHESIA DELIVERY AND PAIN MANAGEMENT</b></p>

<p style='text-align:justify;text-autospace:none'><b>SANTA ANA, CA,</b> November 2, 2005 -
PRO-DEX, INC. (NASDAQ:
PDEX), a developer and manufacturer of <em style="font-style: normal">embedded
motion control and miniature rotary drive systems, serving the medical, dental,
factory automation, and scientific research markets,</em> today
announced that it has acquired certain assets related to the dental business of
IntraVantage Inc., the developer and marketer of intraosseous drug delivery
technology for medical and dental applications.</p>



<p style='text-align:justify;text-indent:36.0pt;text-autospace:
none'>Commenting
on the acquisition, Patrick Johnson, President and Chief Executive Officer
said, &quot;Completing this transaction marks a new chapter in growth for Pro-Dex as
it is indicative of how we intend to utilize the infrastructure we have put into
place during the past three years, and leverage the profits and cash we have
generated to enable us to benefit from products we have recently developed.&nbsp; The
IntraFlow&trade;
Intraosseous Anesthesia Delivery System is the latest technology in pain
management for the dental professional and represents a major breakthrough in providing
fear management for the anxious dental patient. Acquiring the technology related to a
product that we already exclusively manufacture will enable us to move one
level of distribution closer to the end-user, reducing the cost of the product
to the end-user while increasing the profitability of the product.&nbsp; The
promotion of the IntraFlow&trade; System fits seamlessly into our existing
sales and marketing efforts for branded dental products and as such, we expect revenue
growth from this product without a corresponding increase in expenses, and with
an incremental increase to profit contribution.&quot;</p>



<p style='text-align:justify;text-indent:36.0pt;text-autospace:
none'>The
IntraFlow&trade; System is a one-step intraosseous (intraosseous meaning &quot;within the
bone&quot;) technology that minimizes the facial numbness and patient discomfort,
during and after the dental procedure, which is normally associated with
delivering profound local anesthesia. The IntraFlow System
delivers effective, immediate anesthesia without the use of a traditional
hypodermic needle. For the first time, anesthetic can now be delivered via proven
intraosseous techniques, in a simple, one-step procedure providing immediate
pain relief and profound pulpal anesthesia in about one minute. Given the success of
the original IntraFlow&trade; Anesthesia Delivery System released in 2003, Pro-Dex was
engaged by IntraVantage to design a more compact, better performing and ergonomically
pleasing handpiece as the central component of the system.&nbsp; Pro-Dex subsequently
entered into an exclusive supply agreement with IntraVantage and began to
deliver handpieces to IntraVantage in March of 2005 as previously announced.&nbsp; IntraVantage
began selling the product in limited distribution in July of 2005, efforts that
will now be assumed and enhanced by Pro-Dex with the completion of this
transaction. In addition to the sale of the handpiece, Pro-Dex will also be
selling the disposable products related to the handpiece that are consumed with
each clinical procedure, creating a recurring revenue stream of approximately
$1.50 per use. </p>
<p style='text-align:justify;text-indent:36.0pt;text-autospace:
none'>&nbsp;</p>
<div class=MsoNormal align=center style='text-align:center'>

<hr size=2 width="100%" noshade color=navy align=center>

</div>



<br
clear=all style='page-break-before:always'>












<p style='text-align:justify;text-indent:36.0pt;text-autospace:
none'>Pro-Dex
paid approximately $1.1 million in cash to close the transaction with
additional cash payments of $400,000 to be paid over the next four years and
also expects to incur approximately $60,000 in extra-ordinary expenses related
to the completion of the transaction. In addition, Pro-Dex will pay IntraVantage
royalties on total net sales above pre-determined sales targets over the next
five years and has licensed back to IntraVantage the rights to develop and sell
non-dental products based on the acquired proprietary technologies.&nbsp; Sales of
the IntraFlow System are not expected to impact Pro-Dex's previously announced
revenue guidance as anticipated sales of the product to IntraVantage were
already included in previous guidance. In conjunction with this transaction,
Pro-Dex will be reversing approximately $300,000 in sales to IntraVantage
during the second fiscal quarter, sales that relate to product which was
returned to Pro-Dex at the close of the transaction. Pro-Dex will also reduce
its open order backlog by approximately $900,000 to eliminate all orders
currently in place from IntraVantage. Additionally, this adjustment is not
expected to unfavorably impact bottom-line earnings during the second quarter
and the remainder of the year as the impact on profit was previously addressed
through increased reserves for accounts receivable during the fourth quarter of
fiscal 2005 and the first quarter of fiscal year 2006. </p>



<p style='text-align:justify;text-indent:36.0pt;text-autospace:
none'>&quot;According
to the Surgeon General, 80% of patients dislike going to the dentist because
they fear pain and do not like the lingering facial numbness caused by
anesthesia, stated Mr. Johnson.&nbsp; Patients who experience the IntraFlow System
say it provides immediate comfort without the side effects usually associated
with traditional syringe injections. With immediate onset, IntraFlow saves time
and clinicians may work on multiple quadrants of the mouth during a single patient
visit. Following treatment with the IntraFlow System, patients can resume
normal activities such as eating, drinking and talking, without having to wait
for the anesthesia to &quot;wear off&quot;. While intraosseous anesthesia has been
historically perceived as a supplemental procedure to traditional syringe
delivered techniques, we believe that through effective education and
promotion, the IntraFlow System will be viewed as a primary means of
anesthesia, used in multiple quadrant restorative procedures and longer
endodontic treatments. Consequently, we see the potential for this product to
make significant inroads into a market where approximately 120 to 150 million
injections are given each year in the US alone and where there have been no
real broad-based innovations in dental anesthesia for decades.&quot;</p>



<p style='text-align:justify'>Pro-Dex Inc., with operations in
Santa Ana, California and Beaverton, Oregon, specializes in bringing speed to
market&nbsp;in the&nbsp;development and manufacture of&nbsp;technology-based
solutions that incorporate embedded motion control and miniature rotary drive
systems, serving the medical, dental, factory automation, and scientific
research markets. Pro-Dex's products are found in hospitals, dental offices,
medical engineering labs, scientific research facilities and high tech manufacturing
operations&nbsp;around the world.
For more information, visit the Company's website at <font color="#0000FF"> <u>www.pro-dex.com</u></font>.
</p>



<p align="justify"><font size="2">Statements
herein concerning the Company's plans, growth and strategies may include
'forward-looking statements' within the context of the federal securities laws.
Statements regarding the Company's future events, developments and future
performance, as well as management's expectations, beliefs, plans, estimates or
projections relating to the future, are forward-looking statements within the
meaning of these laws. The Company's actual results may differ materially from
those suggested as a result of various factors. Interested parties should refer
to the disclosure concerning the operational and business concerns of the
Company set forth in the Company's filings with the Securities and Exchange
Commission.</font></p>
<p>&nbsp;</p>
<p>&nbsp;</p>





<div class=MsoNormal align=center style='text-align:center'>

<hr size=2 width="100%" noshade color=navy align=center>

</div>







</body>

</html>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.1
<SEQUENCE>3
<FILENAME>ex10-11.htm
<TEXT>
<html>

<head>


<title>Exhibit 10.1</title>


</head>

<body lang=EN-US>















<p style='margin-top:0pt;' align="justify">&nbsp;</p>
<p style='margin-top:0pt;' align="justify"><b><font size="2">EXHIBIT 10.1</font></b></p>



<p style='margin-top:0pt' align="center"><b><font size="2">ASSET PURCHASE AGREEMENT</font></b></p>



<p style="text-indent: 0.5in" align="justify"><font size="2">THIS ASSET PURCHASE AGREEMENT (the &quot;<u>Agreement</u>&quot;) is entered
into as of October 31, 2005, between Pro-Dex, Inc., a Colorado corporation with
offices located at 151 East Columbine Avenue, Santa Ana, California 92707 (&quot;<u>Purchaser</u>&quot;),
and IntraVantage, Inc., a Delaware corporation with offices located at 2950
Xenium Lane North, Suite 148, Plymouth, Minnesota, 55441-2623 (&quot;<u>Seller</u>&quot;).</font></p>

<p align="center"><b><u><font size="2">R E C I
T A L S</font></u></b></p>

<p align="justify" style="text-indent: 0.5in"><font size="2">A.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Seller owns and operates a dental products business
(the &quot;<u>Business</u>&quot;).</font></p>

<p align="justify" style="text-indent: 0.5in"><font size="2">B.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Purchaser desires to acquire from Seller, and Seller
desires to sell to Purchaser, all of the Assets (as defined below) used by
Seller in the operation of the Business.</font></p>

<p align="justify" style="text-indent: 0.5in"><font size="2">NOW, THEREFORE, THE PARTIES AGREE AS FOLLOWS:</font></p>

<p style='margin-left:0pt;text-indent:0pt' align="center"><b><font size="2">ARTICLE
I</font></b><font size="2"><br>
</font>
<a name="_Toc115780158"><b><u><font size="2">DEFINED TERMS</font></u></b></a></p>

<p align="justify" style="text-indent: 0.5in"><font size="2">The following capitalized terms, when used in this Agreement,
shall have the meanings set forth below, unless the context clearly indicates
otherwise.</font></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780159">
<font size="2">1.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<b><u>Affiliate</u></b>&quot; has the meaning set
forth in Rule 12b-2 of the regulations promulgated under the Securities
Exchange Act of 1934.</font></a></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780160">
<font size="2">1.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<b><u>Agreement</u></b>&quot; means this Asset
Purchase Agreement.</font></a></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780161">
<font size="2">1.3&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<b><u>Amendment to Supply Agreement</u></b>&quot;
means the Amendment to Supply Agreement, dated June 17, 2005, between Purchaser
and Seller.</font></a></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780162">
<font size="2">1.4&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<b><u>Amendment No. 2 to Supply Agreement</u></b>&quot; means the Amendment No. 2 to Supply Agreement, dated
September 1, 2005, between Purchaser and Seller.</font></a></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780163">
<font size="2">1.5&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<b><u>Assets</u></b>&quot; means all right, title and
interest in and to all of the assets of Seller set forth on <u>Attachment 1.5</u>.</font></a><font size="2">
</font>
</p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780164">
<font size="2">1.6&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<b><u>Assignment Agreements</u></b>&quot; means the
assignment agreements in the forms attached as <u>Exhibit B</u>, under which
Seller will assign, and Purchaser will assume, all of Seller's right, title and
interest in and to all of those Assets which are contracts, agreements,
Purchased Intellectual Property and permits.</font></a></p>
<p style='margin-left:0pt; text-indent:0.5in' align="justify">&nbsp;</p>



<div class=MsoNormal align=center style='text-align:center'>

<hr noshade color=navy align=justify>

</div>



<font size="2">



<br clear=all
style='page-break-before:always'>










</font>










<p style='margin-left:0pt; text-indent:0.5in' align="justify"><font size="2">1.7&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&quot;<b><u>Assumed Liabilities</u></b>&quot; means the
liabilities set forth on <u>Attachment 1.7</u>, and only the liabilities set
forth on <u>Attachment 1.7</u>.&nbsp; The Assumed Liabilities shall not include any
liability of Seller which is not expressly included on <u>Attachment 1.7</u>.</font></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780166">
<font size="2">1.8&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&quot;<b><u>Bill of Sale</u></b>&quot; means the bill of
sale in the form attached as <u>Exhibit C</u>, under which Seller will sell,
transfer, assign and convey to Purchaser all of Seller's rights, title and
interest in and to all of those Assets which are tangible personal property.</font></a></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780167">
<font size="2">1.9&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<b><u>Business</u></b>&quot; means the dental
products business owned and operated by Seller.</font></a></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780168">
<font size="2">1.10&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<b><u>Closing</u></b>&quot; means the closing of the
purchase and sale of the Assets in accordance with this Agreement.</font></a></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780169">
<font size="2">1.11&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<b><u>Closing Date</u></b>&quot; means
the date on which Closing will take place, as specified in <u>Section 3.1</u>.</font></a></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780170">
<font size="2">1.12&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<b><u>Credit Facility</u></b>&quot; means
Seller's credit facility specified in <u>Section 2.2(d)</u>.</font></a></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780171">
<font size="2">1.13&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<b><u>Disclosure Schedule</u></b>&quot; means the disclosure schedules described in the preamble to
Article IV and attached hereto as <u>Exhibit A</u>.</font></a></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780172">
<font size="2">1.14&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<b><u>Governmental Authority</u></b>&quot; shall mean any federal, state, local or foreign governmental,
administrative or regulatory authority, agency, commission, tribunal, court or
other body.</font></a></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780173">
<font size="2">1.15&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<b><u>Installment Payments</u></b>&quot; means the installment payments payable by Purchaser to Seller
pursuant to <u>Section 2.2(b)</u>.</font></a></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780174">
<font size="2">1.16&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<b><u>Liabilities</u></b>&quot; means all
indebtedness, claims, liabilities, obligations, responsibilities, losses,
damages, judgments, punitive damages, economic damages, treble damages, costs
and expenses (including, without limitation, reasonable attorney, expert,
engineering and consulting fees and costs and any fees and costs associated
with any investigation, feasibility, or remedial action studies or
transportation, disposal or other remedial actions), fines, penalties and
monetary sanctions, and interest, whether accrued, absolute or contingent,
known or unknown, and whether or not of a kind required by generally accepted
accounting principles to be set forth on a financial statement or in notes
thereto.</font></a></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780175">
<font size="2">1.17&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<b><u>License Agreement</u></b>&quot; means
the License Agreement in the form attached as <u>Exhibit D</u>, whereby
Purchaser shall license to Seller all Purchased Intellectual Property for use
in conjunction with any non-dental product or application.</font></a></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780176">
<font size="2">1.18&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<b><u>Losses</u></b>&quot; means any
demand, claims, actions, suits, proceedings, assessments, judgments, awards,
costs, losses, damages, liabilities and expenses (including, without
limitation, reasonable attorneys' fees and related costs).</font></a></p>
<p style='margin-left:0pt' align="center"><font size="2">2</font></p>



<div class=MsoNormal align=center style='text-align:center'>

<hr noshade color=navy align=justify>

</div>



<font size="2">



<br clear=all
style='page-break-before:always'>










</font>










<p style='margin-left:0pt; text-indent:0.5in' align="justify"><font size="2">1.19&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<b><u>Person</u></b>&quot; means an individual, a
partnership, a corporation, a limited liability company, an association, a
joint stock company, a trust, a joint venture, an unincorporated organization,
or a governmental entity (or any department, agency, or political subdivision
thereof).</font></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780178">
<font size="2">1.20&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<b><u>Purchase Price</u></b>&quot; means
the purchase price to be paid for the Assets in accordance with <u>Section 2.2</u>.</font></a></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780179">
<font size="2">1.21&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<b><u>Purchase Price Adjustment</u></b>&quot; has the
meaning set forth in <u>Section 2.3</u>.</font></a></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780180">
<font size="2">1.22&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<b><u>Purchaser</u></b>&quot; means
Pro-Dex, Inc., a Colorado corporation.</font></a></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780181">
<font size="2">1.23&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<b><u>Purchased Intellectual
Property</u></b>&quot; means Seller's intellectual property
set forth on <u>Schedule 4.7</u>.</font></a></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780182">
<font size="2">1.24&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<b><u>Restricted Territory</u></b>&quot; means all states, territories, districts, provinces and
commonwealths of the United States, and Canada and throughout the world in
which Seller has conducted any aspect of the Business, and all states,
territories, districts and commonwealths of the United States, Canada and
throughout the world in which Purchaser conducts its business (including,
without limitation, the Business) hereafter.</font></a></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780183">
<font size="2">1.25&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<b><u>Royalty Agreement</u></b>&quot; means the
Royalty Agreement in the form attached as <u>Exhibit E</u>, whereby Purchaser
agrees to make certain royalty payments to Seller for the five year period
immediately following the Closing Date.</font></a></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780184">
<font size="2">1.26&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<b><u>Seller</u></b>&quot; means IntraVantage, Inc.,
a Delaware corporation.</font></a><font size="2">&nbsp; </font> </p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780185">
<font size="2">1.27&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<b><u>Seller's Knowledge</u></b>&quot; means
(i) the actual knowledge of the directors of Seller, and (ii) the actual
knowledge, after reasonable investigation, of any executive officer, or key
employee (identified on <u>Attachment 1.27</u> hereto) of Seller.</font></a></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780186">
<font size="2">1.28&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<b><u>Supply Agreement</u></b>&quot; means
the Supply Agreement, dated June 28, 2004, between Purchaser and Seller.</font></a></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780187">
<font size="2">1.29&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<b><u>Termination and Release Agreement</u></b>&quot; means the Termination and Release Agreement in the form attached
as <u>Exhibit F</u>, whereby Purchaser and Seller shall terminate the Supply
Agreement, the Amendment to Supply Agreement, and the Amendment No. 2 to Supply
Agreement and release the other party from its respective obligations under
such agreements; provided, however, that Sections 10 and 11 of the Supply
Agreement shall survive such termination and release.</font></a></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780188">
<font size="2">1.30&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<b><u>UCC Termination Statements</u></b>&quot; means
the UCC3 Termination Statements in the forms attached hereto as <u>Exhibit H</u>.</font></a></p>

<p style='margin-left:0pt;text-indent:0pt' align="center"><b><font size="2">ARTICLE
II</font></b><font size="2"><br>
</font>
<a name="_Toc115780189"><b><u><font size="2">PURCHASE AND SALE OF ASSETS AND ASSUMPTION OF
LIABILITIES</font></u></b></a></p>
<p style='margin-left:0pt;text-indent:0pt' align="center">&nbsp;</p>
<p style='margin-left:0pt;text-indent:0pt' align="center"><font size="2">3</font></p>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=624
 style='width:468.0pt;border-collapse:collapse'>
 <tr>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=120 valign=bottom style='width:90.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>

  &nbsp;</td>
 </tr>
</table>



<div class=MsoNormal align=center style='text-align:center'>

<hr noshade color=navy align=justify>

</div>



<b><u><font size="2"><br
clear=all style='page-break-before:always'>
</font>
</u></b>









<p style='margin-left:0pt; text-indent:0.5in' align="justify"><font size="2">2.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<b><u>Sale of Assets</u></b>.&nbsp; Subject to the
terms and conditions set forth in this Agreement, Purchaser agrees to purchase
from Seller, and Seller agrees to sell, transfer, convey and deliver to
Purchaser, all of the Assets at the Closing for the consideration specified in <u>Section
2.2</u> below, subject to the adjustment in <u>Section 2.3</u> below.&nbsp; In
addition, at the Closing, Purchaser agrees to assume and become responsible for
all of the Assumed Liabilities.&nbsp; Purchaser will not assume or have any
responsibility, however, with respect to any other obligation or liability or
Seller not specifically included within the definition of Assumed Liabilities.</font></p>

<p style='margin-left:0pt;page-break-after:avoid; text-indent:0.5in' align="justify"><a name="_Toc115780191">
<font size="2">2.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<b><u>Purchase Price</u></b>.&nbsp; The Purchase Price
for the Assets shall be payable as follows:</font></a></p>

<p style='page-break-after:avoid; text-indent:1in' align="justify">
<font size="2">(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Two Hundred Fifty Thousand Dollars ($250,000) in cash to Seller at
Closing, subject to the Purchase Price Adjustment as set forth in <u>Section
2.3</u>.</font></p>

<p align="justify" style="text-indent: 1in"><font size="2">(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Four Hundred Thousand Dollars ($400,000) in cash to Seller, payable in
annual installments of $100,000 on each of the first through fourth anniversary
of the Closing Date (the &quot;<u>Installment Payments</u>&quot;).&nbsp; If Purchaser fails to
timely make any Installment Payment, then the unpaid sum of such Installment
Payment shall accrue interest, commencing on the first day after the
Installment Payment was due, at a rate of five percent (5%) per annum.&nbsp;
Notwithstanding the foregoing, no interest shall accrue on any non-payment or
late payment resulting from Purchaser's exercise of its offset rights pursuant
to <u>Section 7.4</u>.</font></p>

<p align="justify" style="text-indent: 1in"><font size="2">(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Purchaser shall assume the Assumed Liabilities at Closing.</font></p>

<p align="justify" style="text-indent: 1in"><font size="2">(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Purchaser shall cause Seller to be released from any further obligation
under Seller's secured commercial bank credit facility with Equity Bank (the &quot;<u>Credit
Facility</u>&quot;) as of Closing.&nbsp; Purchaser shall have the option, in its sole
discretion, to assume Seller's obligation under the Credit Facility, payoff the
Credit Facility, or a combination of partial payoff and assumption of the
remaining obligation under the Credit Facility.</font></p>

<p align="justify" style="text-indent: 1in"><font size="2">(e)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Purchaser shall enter into the Termination and Release Agreement in the
form attached as <u>Exhibit F</u>.</font></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780192">
<font size="2">2.3&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<b><u>Purchase Price Adjustment</u></b>.&nbsp; The Purchase Price shall be adjusted as follows: In the
event, as of Closing, any amounts are owed by Seller to Purchaser pursuant to
the Amendment to Supply Agreement and/or pursuant to the Amendment No. 2 to
Supply Agreement, including, without limitation, any amounts uncollectible by
Purchaser as a result of prior credits to Seller's customers, then the $250,000
otherwise due to Seller at Closing will be reduced by such total amount due to
Purchaser pursuant to the Amendment to Supply Agreement and/or Amendment No. 2
to Supply Agreement (the &quot;<u>Purchase Price Adjustment</u>&quot;).</font></a></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780193">
<font size="2">2.4&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<b><u>Purchase Price Allocation; Taxes</u></b>.&nbsp;
The parties agree to allocate the Purchase Price among the Assets for all
purposes (including financial accounting and tax purposes) in accordance with
the allocation schedule attached to this Agreement as <u>Attachment&nbsp;2.4</u>.&nbsp;
Any transfer, documentary, sales, use or other taxes assessed upon or with
respect to the transfer of the Assets to Purchaser, and any recording or filing
fees with respect thereto, shall be the responsibility of Seller.</font></a></p>
<p style='margin-left:0pt; text-indent:0.5in' align="justify">&nbsp;</p>
<p style='margin-left:0pt' align="center"><font size="2">4</font></p>



<div class=MsoNormal align=center style='text-align:center'>

<hr noshade color=navy align=justify>

</div>



<font size="2">



<br clear=all
style='page-break-before:always'>










</font>










<p style='margin-left:0pt;text-indent:0pt' align="center"><b><font size="2">ARTICLE
III</font></b><font size="2"><br>
</font>
<a name="_Toc115780194"><b><u><font size="2">CLOSING</font></u></b></a></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780195">
<font size="2">3.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<b><u>Closing Date</u></b>.&nbsp; The Closing shall
occur at a time convenient to the parties; provided that all conditions to
Closing herein set forth will have been satisfied; and further provided that
Closing will occur not later than October 31, 2005, (the &quot;<u>Closing Date</u>&quot;),
unless the parties agree in writing to an extension of the Closing Date.</font></a></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780196">
<font size="2">3.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<b><u>Place of Closing</u></b>.&nbsp; Closing will
take place at the offices of Rutan &amp; Tucker, LLP at 611 Anton Boulevard,
Fourteenth Floor, Costa Mesa, California 92626 or at such other place as the
parties may agree in writing.</font></a></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780197">
<font size="2">3.3&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<b><u>Performance by Seller at Closing</u></b>.&nbsp;
At Closing, Seller will deliver to Purchaser the following:</font></a></p>

<p align="justify" style="text-indent: 1in"><font size="2">(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Within ten (10) calendar days of the Closing Date, Seller shall, at
Purchaser's expense, cause those Assets which are
tangible personal property to be delivered to Purchaser's warehouse located at 151
East Columbine Avenue, Santa Ana, California 92707.&nbsp;
Seller shall bear all risk of loss or damage with respect to all such Assets
until delivery is accepted by Purchaser at Purchaser's warehouse;</font></p>

<p align="justify" style="text-indent: 1in"><font size="2">(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Assignment Agreements, in the form attached as <u>Exhibit B</u>,
duly executed by Seller;</font></p>

<p align="justify" style="text-indent: 1in"><font size="2">(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Bill of Sale, in the form attached as <u>Exhibit C</u>, duly
executed by Seller;</font></p>

<p align="justify" style="text-indent: 1in"><font size="2">(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The License Agreement, in the form attached as <u>Exhibit D</u>, duly
executed by Seller;</font></p>

<p align="justify" style="text-indent: 1in"><font size="2">(e)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Royalty Agreement, in the form attached as <u>Exhibit E</u>, duly
executed by Seller;</font></p>

<p align="justify" style="text-indent: 1in"><font size="2">(f)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Termination and Release Agreement, in the form attached hereto as <u>Exhibit
F</u>, duly executed by Seller;</font></p>

<p align="justify" style="text-indent: 1in"><font size="2">(g)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;[reserved];</font></p>

<p align="justify" style="text-indent: 1in"><font size="2">(h)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The UCC Termination Statements, in the form attached hereto as <u>Exhibit&nbsp;H</u>,
duly executed by Dale E. Kleber and William Harris Investors Ventures
Fund&nbsp;1, LLC, respectively (which execution shall evidence the
authorization of Purchaser to file such UCC Termination Statements with the
Delaware Secretary of State, and such other agencies and in such other
jurisdictions as Purchaser deems necessary or appropriate to terminate the
security interests covered thereby);</font></p>

<p align="justify" style="text-indent: 1in"><font size="2">(i)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Copies of resolutions of both the Board of Directors and the
shareholders of Seller authorizing and approving this Agreement and all other
transactions and agreements contemplated hereby, certified by the Secretary of
Seller;</font></p>
<p align="center"><font size="2">5</font></p>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=624
 style='width:468.0pt;border-collapse:collapse'>
 <tr>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=120 valign=bottom style='width:90.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>

  &nbsp;</td>
 </tr>
</table>



<div class=MsoNormal align=center style='text-align:center'>

<hr noshade color=navy align=justify>

</div>



<font size="2">



<br clear=all
style='page-break-before:always'>










</font>










<p align="justify" style="text-indent: 1in"><font size="2">(j)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
A certificate of the Delaware Secretary of State verifying the good
standing of Seller on a date within twenty (20) days prior to the Closing Date;</font></p>

<p align="justify" style="text-indent: 1in"><font size="2">(k)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
[reserved];</font></p>

<p align="justify" style="text-indent: 1in"><font size="2">(l)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Evidence of all third party notices and/or consents (including, without
limitation, all notices and/or consents set forth on <u>Schedule 4.3</u>) which
may be necessary or desirable, in the reasonable opinion of Purchaser and its
counsel, for the sale, transfer and conveyance of the Assets to Purchaser; and</font></p>

<p align="justify" style="text-indent: 1in"><font size="2">(m)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; All other instruments and documents which are necessary, in the
reasonable opinion of Purchaser and its counsel, to fulfill the obligations of
Seller under this Agreement which are required to be fulfilled on or prior to
the Closing Date.</font></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780198">
<font size="2">3.4&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<b><u>Performance by Purchaser at Closing</u></b>.&nbsp;
At Closing, Purchaser will deliver to Seller the following:</font></a></p>

<p align="justify" style="text-indent: 1in"><font size="2">(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The cash portion of the Purchase Price by cashier's check or wire
transfer, payable to Seller as provided in <u>Section 2.2(a)</u>;</font></p>

<p align="justify" style="text-indent: 1in"><font size="2">(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; The Assignment Agreements, in the form attached as <u>Exhibit B</u>,
duly executed by Purchaser;</font></p>

<p align="justify" style="text-indent: 1in"><font size="2">(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The License Agreement, in the form attached as <u>Exhibit D</u>, duly
executed by Purchaser;</font></p>

<p align="justify" style="text-indent: 1in"><font size="2">(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Royalty Agreement, in the form attached as <u>Exhibit E</u>, duly
executed by Purchaser;</font></p>

<p align="justify" style="text-indent: 1in"><font size="2">(e)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Termination and Release Agreement, in the form attached hereto as <u>Exhibit
F</u>, duly executed by Purchaser;</font></p>

<p align="justify" style="text-indent: 1in"><font size="2">(f)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
A letter from Equity Bank, attesting to its release of Seller from any
further obligation under the Credit Facility pursuant to <u>Section 2.2(d)</u>;</font></p>

<p align="justify" style="text-indent: 1in"><font size="2">(g)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
A certificate of the Colorado Secretary of State verifying the good
standing of Purchaser on a date within twenty (20) days prior to the Closing
Date;</font></p>

<p align="justify" style="text-indent: 1in"><font size="2">(h)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Copies of resolutions of the Board of Directors of Purchaser authorizing
and approving this Agreement and all other transactions and agreements
contemplated hereby, certified by the Secretary of Purchaser; and</font></p>

<p align="justify" style="text-indent: 1in"><font size="2">(i)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;All other instruments and documents which are necessary, in the
reasonable opinion of Seller and its counsel, to fulfill the obligations of
Purchaser under this Agreement which are required to be fulfilled on or prior
to the Closing Date.</font></p>
<p align="center"><font size="2">6</font></p>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=624
 style='width:468.0pt;border-collapse:collapse'>
 <tr>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=120 valign=bottom style='width:90.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>

  &nbsp;</td>
 </tr>
</table>



<div class=MsoNormal align=center style='text-align:center'>

<hr noshade color=navy align=justify>

</div>



<b><u><font size="2"><br
clear=all style='page-break-before:always'>
</font>
</u></b>









<p style='margin-left:0pt; text-indent:0.5in' align="justify"><font size="2">3.5&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<b><u>Approval of Documents</u></b>.&nbsp; Unless
otherwise provided herein, all instruments and documents to be delivered will
be dated as of the Closing Date and will be reasonably satisfactory to the
parties and their respective counsel, as to form and content.</font></p>

<p style='margin-left:0pt;text-indent:0pt' align="center"><b><font size="2">ARTICLE
IV</font></b><font size="2"><br>
</font>
<a name="_Toc115780200"><b><u><font size="2">REPRESENTATIONS AND WARRANTIES BY SELLER</font></u></b></a></p>

<p align="justify" style="text-indent: 0.5in"><font size="2">Seller represents and warrants to Purchaser that the following
statements are true and correct on the date hereof, except as set forth in the
disclosure schedule delivered by Seller to Purchaser on the date hereof and
attached hereto as <u>Exhibit&nbsp;A</u> (the &quot;<u>Disclosure Schedule</u>&quot;):</font></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780201">
<font size="2">4.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<b><u>Corporate Status</u></b>.&nbsp; Seller is a
corporation duly organized, validly existing and in good standing under the
laws of the State of Delaware, and has all requisite corporate power and
authority and all licenses, permits and authorizations necessary to own the
Assets and carry on its business as it is now being conducted.</font></a></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780202">
<font size="2">4.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<b><u>Corporate Documents</u></b>.&nbsp; Seller has
provided Purchaser true, correct and complete copies of Certificate of
Incorporation and Bylaws, including all amendments thereto, and true, correct
and complete copies of the minutes of all directors' and shareholders' meetings
of Seller.</font></a></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780203">
<font size="2">4.3&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<b><u>Authority to Perform Agreement</u></b>.&nbsp;
Seller has the power to enter into this Agreement and to carry out its
obligations hereunder, and the execution, delivery and performance of this
Agreement by Seller has been duly authorized by all necessary corporate action
on the part of the shareholders and board of directors of Seller.&nbsp; The
execution and performance of this Agreement does not violate, or result in a
beach of, or constitute a default under, any judgment, order or decree to which
Seller or any of the Assets may be subject.&nbsp; Such execution or performance does
not constitute a violation of or conflict with any duty to which Seller is
subject or any provision of the Certificate of Incorporation or Bylaws of
Seller.&nbsp; Neither the exercise and delivery of this Agreement, nor the
consummation of the transactions contemplated herein, nor compliance with the
terms and provisions hereof, will result in the creation or imposition of any
lien, charge or encumbrance upon any of the property of Seller pursuant to the
terms of, or conflict in any way with the provisions of, or constitute a
default under, or require the consent of any other party to, any indenture, mortgage,
deed of trust, agreement, lease, or other instrument to which Seller is a party
or by which it may be bound or to which it, the Business or any of the Assets
may be subject, except for the consents or approvals of those Persons
identified on <u>Schedule 4.3</u>, which consents or approvals have been
obtained or will be obtained prior to Closing.&nbsp; Except as set forth on <u>Schedule
4.3</u>, neither the execution of this Agreement nor consummation of the sale
of the Assets hereunder requires notice to or the approval or consent of any
Governmental Authority having jurisdiction over the Business or of any party to
any agreement with Seller, as a condition to the continuance of Seller's
conduct of its business or the continuance by Purchaser of the Business or of such
agreements after the sale, transfer and conveyance of the Assets in accordance
with this Agreement.</font></a></p>
<p style='margin-left:0pt; text-indent:0.5in' align="justify">&nbsp;</p>
<p style='margin-left:0pt' align="center"><font size="2">7</font></p>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=624
 style='width:468.0pt;border-collapse:collapse'>
 <tr>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=120 valign=bottom style='width:90.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>

  &nbsp;</td>
 </tr>
</table>



<div class=MsoNormal align=center style='text-align:center'>

<hr noshade color=navy align=justify>

</div>



<b><u><font size="2"><br
clear=all style='page-break-before:always'>
</font>
</u></b>









<p style='margin-left:0pt; text-indent:0.5in' align="justify"><font size="2">4.4&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<b><u>Litigation</u></b>.&nbsp; Except as set forth on
<u>Schedule 4.4</u>, there are no actions, suits, claims, proceedings or
investigations pending or, to Seller's Knowledge, threatened against or
affecting the Business or the Assets at law or in equity or before or by any
federal, state, municipal or other governmental court, department, commission,
board, bureau, agency or instrumentality, domestic or foreign.&nbsp; Except as set forth
on <u>Schedule 4.4</u>, Seller is not subject to or in default with respect to
any order, writ, injunction or decree of any court or federal, state, municipal
or other governmental department, commission, board, bureau, agency or
instrumentality with respect to the Business or the Assets.&nbsp; Seller has
complied in all material respects with all laws, regulations and orders
applicable to the Business and the Assets.&nbsp; None of the actions, suits, claims,
proceedings and investigations disclosed on <u>Schedule 4.4</u> could result in
any adverse change in the business, financial condition, operations, results of
operations or future prospects of the Business, or materially impair the value
of the Assets.</font></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780205">
<font size="2">4.5&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; &nbsp;
<b><u>Stockholder, Officer and Employee Claims</u></b>.&nbsp; No stockholder, officer or employee of Seller has any claim
or claims against the Business or the Assets.</font></a></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780206">
<font size="2">4.6&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; &nbsp;<b><u>Title to Assets</u></b>.&nbsp; Except as
disclosed on <u>Schedule 4.6</u>, Seller has good and marketable title to all
of the Assets, free and clear of any and all mortgages, liens, pledges, privileges,
charges or encumbrances of every kind, nature and description; all tangible
properties which comprise the Assets are in Seller's possession or custody or
under its control.</font></a></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780207">
<font size="2">4.7&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<b><u>Intellectual Properties</u></b>.&nbsp; Subject
to the terms of the Royalty Agreement between Purchaser and Seller of even date
herewith, (i) Seller owns or has the right to use pursuant to license,
sublicense, agreement or permission all patents, patent applications, patent
rights, licenses, trademarks, trademark applications, trademark rights, trade
names, trade name rights, service marks, service mark rights, copyrights,
copyright applications and similar rights necessary or desirable for the
operation of its Business as currently conducted (the &quot;<u>Purchased
Intellectual Property</u>&quot;),and&nbsp; (ii) each item of Purchased Intellectual
Property owned or used by Seller immediately prior to the Closing will be owned
or available for use by Purchaser on identical terms and conditions immediately
following the Closing.&nbsp; Seller has taken all necessary action to maintain and
protect each item of Purchased Intellectual Property.&nbsp; <u>Schedule 4.7</u>
identifies all patents, patent applications, patent rights, licenses,
trademarks, trademark applications, trademark rights, trade names, trade name
rights, service marks, service mark rights, copyrights, copyright applications
and similar rights constituting the Purchased Intellectual Property.&nbsp; Seller
has delivered to Purchaser true, correct and complete copies of all
registrations, applications, licenses, agreements and permission for the
Purchased Intellectual Property.&nbsp; Seller is not infringing or otherwise acting
adversely to the right of any other person under or in respect to, any patent,
license, trademark, trade name service mark, copyright or similar intangible
right.</font></a></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780208">
<font size="2">4.8&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; &nbsp;
<b><u>Insurance</u></b>.&nbsp; </font> </a><font size="2"><u>Schedule 4.8</u> sets forth the following information with
respect to each insurance policy to which Seller has been a party, a named
insured, or otherwise the beneficiary of coverage at any time within the past
three (3) years:</font></p>

<p align="justify" style="text-indent: 1in"><font size="2">(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;the name, address, and telephone number of the agent;</font></p>

<p align="justify" style="text-indent: 1in"><font size="2">(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
the name of the insurer, the name of the policyholder, and the name of
each covered insured;</font></p>

<p align="justify" style="text-indent: 1in"><font size="2">(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
the policy number and the period of coverage;</font></p>
<p align="justify" style="text-indent: 1in">&nbsp;</p>
<p align="center"><font size="2">8</font></p>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=624
 style='width:468.0pt;border-collapse:collapse'>
 <tr>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=120 valign=bottom style='width:90.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>

  &nbsp;</td>
 </tr>
</table>



<div class=MsoNormal align=center style='text-align:center'>

<hr noshade color=navy align=justify>

</div>



<font size="2">



<br clear=all
style='page-break-before:always'>










</font>










<p align="justify" style="text-indent: 1in"><font size="2">(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
the scope (including an indication of whether the coverage was on a
claim made, occurrence, or other basis) and amount (including a description of
how deductibles and ceilings are calculated and operate) of coverage; and</font></p>

<p align="justify" style="text-indent: 1in"><font size="2">(e)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
a description of any retroactive premium adjustments or other
loss-sharing arrangements.</font></p>

<p align="justify" style="text-indent: 0.5in"><font size="2">For the four year period prior to and
including June 23, 2005, Seller was covered by insurance (on an occurrence
basis) in scope and amount customary and reasonable for the business in which
it has engaged during the aforementioned period.&nbsp; <u>Schedule
4.8</u> describes any self-insurance arrangements affecting Seller.</font></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780209">
<font size="2">4.9&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<b><u>Financial Statements</u></b>.&nbsp; Seller has
provided Purchaser with a balance sheet of Seller as of September 30, 2005, and
the related statements of income, retained earnings and cash flow for the
period then ended, a copy of which is attached hereto as <u>Schedule 4.9</u>
(the &quot;<u>Financial Statements</u>&quot;), and such other financial information,
corporate records and documents material to the operation of Seller's business
as Purchaser has reasonably requested.&nbsp; The Financial Statements are true and
correct in all material respects and present fairly the financial condition and
results of operations of Seller for the period specified. The books of account
from which the Financial Statements were prepared accurately reflect all of the
items of income and expense, all assets and liabilities, and all accruals.&nbsp;
Seller has no undisclosed depreciable assets, and all depreciation and
investment credit taken for tax purposes is disclosed on the Financial
Statements.</font></a></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780210">
<font size="2">4.10&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<b><u>Conduct of Business, Licenses, Etc</u></b>.&nbsp;
Except as disclosed in <u>Schedule 4.10</u>, the conduct of the Business is not
dependent on any governmental or private license, permit or other
authorization, and the consummation of the transactions contemplated by this
Agreement will not terminate or adversely affect any such license, permit or
authorization.</font></a></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780211">
<font size="2">4.11&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<b><u>&nbsp;Disclosure</u></b>.&nbsp; Neither this Agreement
nor any of the Attachments, Schedules or Exhibits attached to this Agreement
contains any untrue statement of any material fact or omits to state any
material fact required to be stated herein or therein, or necessary in order to
make the statements contained herein or therein not misleading.&nbsp; To Seller's
Knowledge, there is no fact which materially adversely affects, or in the
future may (so far as Seller can now reasonably foresee) materially adversely
affect the Assets or the prospects or condition (financial or otherwise) of the
Business, which fact has not been disclosed in writing to Purchaser prior to
the date hereof or set forth herein or in the Schedules attached to this
Agreement.</font></a></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780212">
<font size="2">4.12&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<b><u>&nbsp;Condition of Tangible Assets</u></b>.&nbsp; All of those Assets which are tangible personal property
are in good condition and repair and are in conformity with all applicable
rules, regulations and laws.</font></a></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc114902586">
<font size="2">4.13&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<b><u>&nbsp;Tax Returns</u></b>.&nbsp; All federal, state,
local, county, franchise, sales, use, excise, property and other taxes which
are due and payable have been duly paid.&nbsp; Seller has withheld and paid all
taxes required to have been withheld and paid in connection with amounts paid
or owing to any employee, independent contractor, creditor, stockholder or
other third party.</font></a></p>
<p style='margin-left:0pt; text-indent:0.5in' align="justify">&nbsp;</p>
<p style='margin-left:0pt' align="center"><font size="2">9</font></p>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=624
 style='width:468.0pt;border-collapse:collapse'>
 <tr>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=120 valign=bottom style='width:90.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>

  &nbsp;</td>
 </tr>
</table>



<div class=MsoNormal align=center style='text-align:center'>

<hr noshade color=navy align=justify>

</div>



<font size="2">



<br clear=all
style='page-break-before:always'>










</font>










<p style='margin-left:0pt;text-indent:0pt' align="center"><b><font size="2">ARTICLE
V</font></b><font size="2"><br>
</font>
<a name="_Toc115780213"><b><u><font size="2">REPRESENTATIONS AND WARRANTIES BY PURCHASER</font></u></b></a></p>

<p align="justify" style="text-indent: 0.5in"><font size="2">Purchaser represents and warrants to Seller that the following
statements are true and correct on the date hereof:</font></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780214">
<font size="2">5.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<b><u>Organization in Good Standing</u></b>.&nbsp;
Purchaser is a corporation duly organized, validly existing and in good
standing under the laws of the State of Colorado.</font></a></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780215">
<font size="2">5.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<b><u>Authority to Perform Agreement</u></b>.&nbsp;
Purchaser has the corporate power to enter into this Agreement and to carry out
its obligations hereunder.&nbsp; The execution and delivery of this Agreement, the
payments provided for herein, and the consummation of transactions contemplated
hereby, have been duly authorized by Purchaser's board of directors, and no
other corporate proceeding on the part of Purchaser is necessary to authorize
Purchaser's officers to perform this Agreement and the transactions
contemplated herein.</font></a></p>

<p style='margin-left:0pt;text-indent:0pt' align="center"><b><font size="2">ARTICLE
VI</font></b><font size="2"><br>
</font>
<a name="_Toc115780216"><b><u><font size="2">COVENANTS</font></u></b></a></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780217">
<font size="2">6.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<b><u>Reimbursement for Uncollectible Accounts</u></b>.&nbsp; Seller will indemnify and hold Purchaser harmless from any
accounts receivable included in the Assets which become more than ninety (90)
days past due (in addition to any obligation to indemnify created under <u>Article&nbsp;VII</u>
below).&nbsp; Purchaser may, at its option, offset against the payment of (i) any
Installment Payments and/or (ii) any royalty payment under the Royalty
Agreement, any and all amounts to which Purchaser is entitled pursuant to this <u>Section
6.1</u> in accordance with <u>Section&nbsp;7.4</u>.</font></a></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780218">
<font size="2">6.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<b><u>Further Action</u></b>.&nbsp; If at any time
after Closing any further action is necessary or desirable to carry out the
purposes of this Agreement, Purchaser and Seller will take such further action
(including the execution and delivery of such further instruments and
documents) as the other party to this Agreement reasonably may request, all at
the sole cost and expense of the requesting party unless the requesting party
is entitled to indemnification thereof under <u>Article&nbsp;VII</u> below.&nbsp;
Seller acknowledges and agrees that from and after the Closing, Purchaser will
be entitled to possession of all documents, books, records, tax records,
agreements and financial data of any sort relating to the Assets.</font></a><font size="2">&nbsp; To the extent that Purchaser fails to make required
administrative/governmental payments to maintain in force and effect the
Purchased Intellectual Property, then Seller shall have the right to make such
payments provided, however, that Seller's election to make such payments shall
have no effect on Purchaser's title, right and ownership of the Purchased
Intellectual Property which shall remain wholly in Purchaser's possession.
</font> </p>
<p style='margin-left:0pt' align="center"><font size="2">10</font></p>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=624
 style='width:468.0pt;border-collapse:collapse'>
 <tr>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=120 valign=bottom style='width:90.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>

  &nbsp;</td>
 </tr>
</table>



<div class=MsoNormal align=center style='text-align:center'>

<hr noshade color=navy align=justify>

</div>



<b><u><font size="2"><br
clear=all style='page-break-before:always'>
</font>
</u></b>









<p style='margin-left:0pt; text-indent:0.5in' align="justify"><font size="2">6.3&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<b><u>Litigation Support</u></b>.&nbsp; If and for so
long as any party actively is contesting or defending against any action, suit,
proceeding, hearing, investigation, charge, complaint, claim or demand in
connection with (i) any transaction contemplated under this Agreement or (ii)
any fact, situation, circumstance, status, condition, activity, practice, plan,
occurrence, event, incident, action, failure to act, or transaction on or prior
to the Closing Date involving the Business or the Assets, the other party will
cooperate with it and its counsel in the contest or defense, make available its
personnel, and provide such testimony and access to its books and records as
may be necessary or desirable in connection with the contest or defense, all at
the sole cost and expense of the contesting or defending party, unless the
contesting or defending party is entitled to indemnification therefor under <u>Article
VII</u> below.</font></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780220">
<font size="2">6.4&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<b><u>Transition</u></b>.&nbsp; Seller will not take
any action that is designed or intended to have the effect of discouraging any
lessor, licensor, customer, supplier, or other business associate of Seller
from maintaining the same business relationships with Purchaser after the
Closing as such party maintained with Seller prior to the Closing.&nbsp; Seller will
refer all customer inquiries relating to the Business to Purchaser from and
after Closing.</font></a></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780221">
<font size="2">6.5&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<b><u>Employees</u></b>.&nbsp; Purchaser
may need to contract with various key personnel of Seller as of or after the
Closing.&nbsp; Seller shall take all actions reasonably required by Purchaser to
assist in this process including, without limitation, providing Purchaser
access to all Seller's organizational charts, personnel records and payroll
records and by allowing and encouraging Seller's employees to meet with
Purchaser's representatives.&nbsp; Notwithstanding anything to the contrary in this
Agreement, Purchaser shall have no obligation of any kind with respect to any
of Seller's employees. Seller shall be solely responsible for the termination
and any related costs of all Seller's employees who are terminated or whose
employment is otherwise adversely affected by Seller's execution and
performance of this Agreement.</font></a></p>

<p style='margin-left:0pt;page-break-after:avoid; text-indent:0.5in' align="justify"><a name="_Toc115780222">
<font size="2">6.6&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<b><u>&nbsp;Non-Competition</u></b>.</font></a><font size="2">&nbsp; </font> </p>

<p style='page-break-after:avoid; text-indent:1in' align="justify">
<font size="2">(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
As further consideration for the purchase and sale of the Assets and the
other agreements and transactions contemplated by this Agreement, during the
period commencing on the Closing Date, and ending on the date which is five (5)
years thereafter (the &quot;<u>Restricted Period</u>&quot;), Seller shall not, in any
Restricted Territory, directly or indirectly:</font></p>

<p align="justify" style="text-indent: 1.5in"><font size="2">(i)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;engage in any business, activity, or enterprise competitive with or
substantially similar to the Business, including, without limitation, in the
manufacture, production, design, engineering, importation, purchase, marketing,
sale, distribution, research or development of any dental products, or engage
or invest in, own, manage, operate, finance, control, solicit business related
to, or participate in the ownership, management, operation, financing, or
control of, be employed by, lend its name or any similar name, or lend its
credit to, or render services or advice to, any Person engaged in any business,
activity or enterprise competitive with the Business including, without
limitation, in the manufacture, production, design, engineering, importation,
purchase, marketing, sale, distribution, research or development of any dental
products;</font></p>

<p align="justify" style="text-indent: 1.5in"><font size="2">(ii)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
on behalf of itself or any other Person, recruit or solicit&nbsp; any person
who has been an employee, representative, consultant or agent of Purchaser or
former employee of Seller hired by Purchaser, to terminate his or her
employment with Purchaser;</font></p>
<p align="justify" style="text-indent: 1.5in">&nbsp;</p>
<p align="center"><font size="2">11</font></p>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=624
 style='width:468.0pt;border-collapse:collapse'>
 <tr>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=120 valign=bottom style='width:90.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
 </tr>
</table>



<div class=MsoNormal align=center style='text-align:center'>

<hr noshade color=navy align=justify>

</div>



<font size="2">



<br clear=all
style='page-break-before:always'>










</font>










<p align="justify" style="text-indent: 1.5in"><font size="2">(iii)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
solicit, call upon, or attempt to communicate with any customer, former
customer, or prospective customer of Purchaser or Seller for the purposes of
manufacture, production, design, engineering, importation, purchase, marketing,
sale, distribution, research or development of any dental products; provided,
however, that Seller may solicit, call upon, or attempt to communicate with any
customer, former customer, or prospective customer of Purchaser or Seller
pursuant to specific written instructions from Purchaser.&nbsp; For purposes of this
paragraph, &quot;contact&quot; means interaction between Seller or any of its officers,
directors, employees or agents directly or indirectly, and the customer, former
customer or prospective customer which takes place to further the business
relationship, or performing of services, on behalf of Seller.</font></p>

<p align="justify" style="text-indent: 1in"><font size="2">(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Seller shall be deemed to be competing with Purchaser in violation of <u>Section
6.6(a)</u> if Seller, or any Affiliate of Seller (except the directors of
Seller currently members of William Harris), is engaged or participates in any
activity or activities described in <u>Section 6.6(a)</u>, directly or
indirectly, whether for its own account or for that of any other Person, and
whether as a shareholder, partner or investor controlling any such entity or as
principal, agent, representative, proprietor or partner, or in any other
capacity; <u>provided</u>, <u>however</u>, that nothing herein shall prohibit
purely passive investments in any business so long as the aggregate interest
represented by such investments does not exceed one percent (1%) of any class
of the outstanding debt or equity securities of said business.</font></p>

<p align="justify" style="text-indent: 1in"><font size="2">(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Because a breach, or failure to comply with, this <u>Section 6.6</u>
will cause irreparable injury to Purchaser for which there is no adequate
remedy at law and the exact amount of which will be difficult to ascertain, if
Seller or any Affiliate of Seller, should in any way breach, or fail to comply
with, the terms of this <u>Section 6.6</u>, Purchaser shall be entitled to seek
and obtain an injunction restraining such Seller and/or it Affiliate(s), as
applicable, from any such breach or failure without having to prove monetary
damages.&nbsp; All remedies expressly provided for herein are cumulative of any and
all other remedies now existing at law or in equity, to the extent permitted
under applicable law.&nbsp; Purchaser shall, in addition to the remedies herein
provided, be entitled to avail itself of all such other remedies as may now or
hereafter exist at law or in equity for compensation, and for the specific
enforcement of the covenants contained herein without the necessity of proving
actual damages.&nbsp; Resort to any remedy provided for hereunder or provided for by
law shall not preclude or bar the concurrent or subsequent employment of any other
appropriate remedy or remedies, or preclude the recovery by Purchaser of
monetary damages and compensation, including, without limitation, its right to
indemnification pursuant to <u>Article VII</u>.</font></p>
<p align="justify" style="text-indent: 1in">&nbsp;</p>
<p align="center"><font size="2">12</font></p>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=624
 style='width:468.0pt;border-collapse:collapse'>
 <tr>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=120 valign=bottom style='width:90.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>

  &nbsp;</td>
 </tr>
</table>



<div class=MsoNormal align=center style='text-align:center'>

<hr noshade color=navy align=justify>

</div>



<font size="2">



<br clear=all
style='page-break-before:always'>










</font>










<p align="justify" style="text-indent: 1in"><font size="2">(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
If any provision of this <u>Section&nbsp;6.6</u> shall finally be
judicially determined to be invalid, ineffective or unenforceable, such
determination shall apply only in the jurisdiction in which such adjudication
is made and every other provision of this <u>Section&nbsp;6.6</u> shall remain
in full force and effect.&nbsp; The invalid, ineffective or unenforceable provision
shall, without further action by the parties, be automatically amended, to the
extent permitted under applicable law, to effect the original purpose and
intent of the invalid, ineffective or unenforceable provision (and if such
provision governs the duration of the Restricted Period or geographic scope of
the Restricted Territory, such provision shall be amended to reduce such
duration or scope, as applicable, as minimally as possible so that such
provision is valid, effective and enforceable for the longest period of time
and fullest geographic area as is adjudged permissible for such provision to be
valid, effective and enforceable); <u>provided</u>, <u>however</u>, that such
amendment shall apply only with respect to the operation of such provision in
the particular jurisdiction in which such adjudication is made.</font></p>

<p align="justify" style="text-indent: 1in"><font size="2">(e)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Seller acknowledges that the duration of the Restricted Period, the
geographic scope of the Restricted Territory, and the scope of restricted
activities described in <u>Section&nbsp;6.6(a)</u> are reasonable and necessary
to protect the legitimate business interests of Purchaser in view of the nature
of the Business, the nature of the business in which Purchaser is engaged, and
the nature of the transactions contemplated by this Agreement. &nbsp;Seller
understands that the foregoing restrictions will significantly limit or bar its
ability to engage in business related to the Business, but nevertheless
believes that it has received and will receive, directly or indirectly,
sufficient consideration and other benefits pursuant to this Agreement and the
other agreements relating to this Agreement to clearly justify such
restrictions.</font></p>

<p align="justify" style="text-indent: 1in"><font size="2">(f)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Seller shall cooperate with Purchaser in Purchaser's communication and
negotiation with certain key equity-owning personnel of Seller with whom
Purchaser desires to enter into non-compete agreements on similar terms as set
forth in <u>Sections&nbsp;6.6(a)-(e)</u> above.</font></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><font size="2">6.7&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<b><u>FDA Regulatory Matters</u></b>.&nbsp; </font> </p>

<p align="justify" style="text-indent: 1in"><font size="2">(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
To the fullest extent permitted by applicable laws and regulations,
Seller agrees to permit Purchaser, without further compensation or obligation
to Seller, to sell products under Seller's United States Food and Drug
Administration (&quot;<u>FDA</u>&quot;) 510(k) certification relating to anesthesia
delivery products.&nbsp; </font> </p>

<p align="justify" style="text-indent: 1in"><font size="2">(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Seller agrees to take such action (including the execution and delivery
of such further instruments and documents) as Purchaser may reasonably request
to assist Purchaser in securing its own FDA 510(k) certification regarding
products related to the Business.</font></p>

<p align="justify" style="text-indent: 1in"><font size="2">(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Promptly upon the written request of Purchaser, Seller agrees to take
such action (including the execution and delivery of such further instruments
and documents) as Purchaser deems necessary or appropriate to terminate
Seller's 510(k) certification.&nbsp; Seller shall not take any action to terminate
Seller's 510(k) certification until requested in writing by Purchaser pursuant
to this <u>Section 6.7(c)</u>.</font></p>
<p align="justify" style="text-indent: 1in">&nbsp;</p>
<p align="center"><font size="2">15</font></p>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=624
 style='width:468.0pt;border-collapse:collapse'>
 <tr>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=120 valign=bottom style='width:90.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>

  &nbsp;</td>
 </tr>
</table>



<div class=MsoNormal align=center style='text-align:center'>

<hr noshade color=navy align=justify>

</div>



<font size="2">



<br clear=all
style='page-break-before:always'>










</font>










<p align="justify" style="text-indent: 1in"><font size="2">(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Seller shall promptly forward to Purchaser any communications or
inquiries received by Seller from or regarding (i) the United States Food and
Drug Administration, (ii) comparable state or foreign agencies, or (iii)
similar regulatory matters, which relate to or are connected with the
Business.&nbsp; In the event such communications or inquiries are received verbally,
Seller shall promptly provide Purchaser an accurate description of such
communications or inquiries, along with contact information for the source of
such communications or inquiries.</font></p>

<p style='margin-left:0pt;text-indent:0pt' align="center"><b><font size="2">ARTICLE
VII</font></b><font size="2"><br>
</font>
<a name="_Toc115780223"><b><u><font size="2">INDEMNIFICATION OF PURCHASER</font></u></b></a></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780224">
<font size="2">7.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<b><u>Survival of Representations, Warranties and Covenants</u></b>.&nbsp; The representations, warranties and covenants contained in
this Agreement shall survive the Closing.</font></a></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780225">
<font size="2">7.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<b><u>Indemnity for the Benefit of Purchaser</u></b>.&nbsp; Seller agrees to and shall indemnify Purchaser and hold
Purchaser harmless from and against the following:</font></a></p>

<p align="justify" style="text-indent: 1in"><font size="2">(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
For a period of two (2) years from the Closing
Date:</font></p>

<p align="justify" style="text-indent: 1.5in"><font size="2">(i)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;any and all Losses or Liabilities resulting from
any misrepresentation made, or breach of warranty given or covenant made by
Seller in this Agreement, except those set forth in <u>Sections 4.6 or 4.7</u>;
and</font></p>

<p align="justify" style="text-indent: 1.5in"><font size="2">(ii)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
any and all Losses or Liabilities incurred by,
arising out of, or relating in any way to matters pertaining to the conduct of
the Business which have arisen or may arise because or as a result of any fact,
event or transaction existing or occurring on or before the Closing Date,
regardless of when the cause of action thereof shall be deemed to arise.</font></p>

<p align="justify" style="text-indent: 1in"><font size="2">(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
For an indefinite period:</font></p>

<p align="justify" style="text-indent: 1.5in"><font size="2">(i)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
any and all Losses or Liabilities resulting from any misrepresentation
made, or breach of warranty given or covenant made in <u>Sections 4.6 or 4.7</u>;
and</font></p>

<p align="justify" style="text-indent: 1.5in"><font size="2">(ii)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
failure to comply with the provisions of any bulk sale laws pursuant to <u>Section
7.9</u>.</font></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780226">
<font size="2">7.3&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<b><u>Indemnity for the Benefit of Seller</u></b>.&nbsp;
For a period of two (2) years from the Closing Date, Purchaser agrees to and
shall indemnify Seller and hold Seller harmless from and against the following:</font></a></p>

<p align="justify" style="text-indent: 1in"><font size="2">(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Any and all Losses and Liabilities resulting from any misrepresentation
made or breach of warranty given or covenant made by Purchaser in this
Agreement; and </font> </p>

<p align="justify" style="text-indent: 1in"><font size="2">(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Any and all Losses and Liabilities incurred by, arising out of, or
relating in any way to matters pertaining to the conduct of the business of
Purchaser which may arise because or as a result of any fact, event or
transaction occurring after the Closing Date, except for claims which are
subject to Seller's indemnification obligations under <u>Section 7.2</u>. </font> </p>
<p align="justify" style="text-indent: 1in">&nbsp;</p>
<p align="center"><font size="2">14</font></p>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=624
 style='width:468.0pt;border-collapse:collapse'>
 <tr>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=120 valign=bottom style='width:90.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>

  &nbsp;</td>
 </tr>
</table>



<div class=MsoNormal align=center style='text-align:center'>

<hr noshade color=navy align=justify>

</div>



<b><u><font size="2"><br
clear=all style='page-break-before:always'>
</font>
</u></b>









<p style='margin-left:0pt; text-indent:0.5in' align="justify"><font size="2">7.4&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<b><u>Right of Offset</u></b>.&nbsp; In addition to
any other remedies which Purchaser may have against Seller at law, in equity or
pursuant to this Agreement, Purchaser may, at its option, offset against the
payment of (i) any Installment Payments and/or (ii) any royalty payment under
the Royalty Agreement, any and all amounts with respect to which Purchaser is
entitled to indemnification pursuant to <u>Sections 6.1, 7.2 or 7.6</u>,
regardless of when the claim for indemnification shall be deemed to arise.&nbsp;
Purchaser shall exercise its right of offset by notifying Seller that Purchaser
is reducing an Installment Payment or royalty payment anytime prior to the due
date for such Installment Payment or royalty payment.</font></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780228">
<font size="2">7.5&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<b><u>Notice</u></b>.&nbsp; If a party shall claim any
right of indemnity under <u>Sections 7.2 or 7.3</u>, the party shall give the
other party a written notice of such claim, setting forth in reasonable detail
the facts giving rise to the claim and the amount of liability asserted by
reason thereof.</font></a></p>

<p style='margin-left:0pt;page-break-after:avoid; text-indent:0.5in' align="justify"><a name="_Toc115780229">
<font size="2">7.6&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<b><u>&nbsp;Matters Involving Third Parties</u></b>.</font></a></p>

<p align="justify" style="text-indent: 1in"><font size="2">(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
If any third party shall notify either party to this Agreement (the &quot;<u>Indemnified
Party</u>&quot;) with respect to any matter (a &quot;<u>Third Party Claim</u>&quot;) which may
give rise to a claim for indemnification against any other party to this
Agreement (the &quot;<u>Indemnifying Party</u>&quot;) under this <u>Article VII</u>, then
the Indemnified Party shall promptly notify the Indemnifying Party thereof in
writing; provided, however, that no delay on the part of the Indemnified Party
in notifying the Indemnifying Party shall relieve the Indemnifying Party from
any obligation hereunder unless (and then solely to the extent) the
Indemnifying Party thereby is prejudiced.</font></p>

<p align="justify" style="text-indent: 1in"><font size="2">(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Indemnifying Party will have the right to defend the Indemnified
Party against the Third Party Claim with counsel of its choice reasonably
satisfactory to the Indemnified Party so long as (i) the Indemnifying Party
notifies the Indemnified Party that the Indemnifying Party will indemnify the
Indemnified Party from the Third Party Claim, (ii) the Indemnifying Party
provides the Indemnified Party with evidence reasonably acceptable to the
Indemnified Party that the Indemnifying Party will have the financial resources
to defend against the Third Party Claim and fulfill its indemnification
obligations hereunder, (iii) the Third Party Claim involves only money damages
and does not seek an injunction or other equitable relief, (iv) settlement of,
or an adverse judgment with respect to, the Third Party Claim is not, in the
good faith judgment of the Indemnified Party, likely to establish a precedential
custom or practice materially adverse to the continuing business interests of
the Indemnified Party, and (v) the Indemnifying Party conducts the defense of
the Third Party Claim actively and diligently.</font></p>

<p align="justify" style="text-indent: 1in"><font size="2">(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
So long as the Indemnifying Party is conducting the defense of the Third
Party Claim in accordance with <u>Section 7.6(b)</u> above, (i) the Indemnified
Party may retain separate co-counsel at its sole cost and expense and
participate in the defense of the Third Party Claim, (ii) the Indemnified Party
will not consent to the entry of any judgment or enter into any settlement with
respect to the Third Party Claim without the prior written consent of the
Indemnifying Party, which shall not be unreasonably withheld, and (iii) the
Indemnifying Party will not consent to the entry of any judgment or enter into
any settlement with respect to the Third Party Claim without the prior written
consent of the Indemnified Party, which shall not be withheld unreasonably.</font></p>
<p align="justify" style="text-indent: 1in">&nbsp;</p>
<p align="center"><font size="2">15</font></p>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=624
 style='width:468.0pt;border-collapse:collapse'>
 <tr>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=120 valign=bottom style='width:90.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>

  &nbsp;</td>
 </tr>
</table>



<div class=MsoNormal align=center style='text-align:center'>

<hr noshade color=navy align=justify>

</div>



<font size="2">



<br clear=all
style='page-break-before:always'>










</font>










<p align="justify" style="text-indent: 1in"><font size="2">(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
If any of the conditions in <u>Section 7.6(b)</u> above is or becomes
unsatisfied, however, (i) the Indemnified Party may defend against, and consent
to the entry of any judgment or enter into any settlement with respect to, the
Third Party Claim in any manner it reasonably may deem appropriate (and the
Indemnified Party need not consult with, or obtain any consent from, any
Indemnifying Party in connection therewith), (ii) the Indemnifying Party will
reimburse the Indemnified Party promptly and periodically for the costs of
defending against the Third Party Claim (including reasonable attorneys' fees
and expenses), and (iii) the Indemnifying Party will remain responsible for any
Losses and Liabilities the Indemnified Party may suffer resulting from, arising
out of, relating to, in the nature of, or caused by the Third Party Claim to
the fullest extent provided in this <u>Article VII</u>.</font></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780230">
<font size="2">7.7&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<b><u>Amount of Damages</u></b>.&nbsp; Each party
agrees that the amount of any Liabilities or Losses claimed by it under the
indemnity provided in this <u>Article VII</u><b> </b>shall be a net amount
after adjustment for any benefit to such party from insurance receipts from
third parties or offsetting tax advantages.</font></a></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780231">
<font size="2">7.8&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<b><u>Resolution of Disputes</u></b>.&nbsp; Any
dispute arising under or related to this Agreement shall be resolved by
arbitration in accordance with the Commercial Arbitration Rules of the American
Arbitration Association, in Orange County, California.&nbsp; The arbitration hearing
shall be conducted by a single neutral arbitrator, who shall be an active
California State Bar member in good standing.&nbsp; In addition to all other powers,
the arbitrator shall have the right to determine all issues of arbitrability
and shall have the authority to issue subpoenas.&nbsp; The parties shall be entitled
to conduct discovery in connection with any claims that are arbitrated under
this Section.&nbsp; All discovery shall be completed within ninety (90) calendar
days after the request for arbitration is filed with the appropriate
authorities and the first hearing date shall be set for no later than thirty
(30) calendar days after the completion of discovery.&nbsp; The arbitrator may
extend such period for any reason, including without limitation, legal
objections raised to such discovery or unavailability of a witness due to
absence or illness.&nbsp; Depositions may be taken by either party upon seven
calendar days written notice, and requests for production or inspection of
documents shall be responded to within 10 calendar days after service.&nbsp; All
disputes relating to discovery that cannot be resolved by the parties shall be
submitted to the arbitrator, whose decision shall be final and binding upon the
parties.&nbsp; The prevailing party in any such arbitration shall be entitled to any
award of its reasonable attorneys' fees and expenses.&nbsp; Any party shall be
entitled to file an action in Orange County Superior Court, which shall have
jurisdiction over the parties of this Agreement, to compel or aid in the
arbitration, or for injunctive relief.&nbsp; Judgment on any arbitration award may
be entered in any court of appropriate jurisdiction.</font></a></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780232">
<font size="2">7.9&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<b><u>Waiver of Bulk Sales Law Compliance</u></b>.&nbsp; Purchaser acknowledges that Seller will not comply with the
provisions of any bulk sales laws of any jurisdiction in connection with the
transactions contemplated by this Agreement.&nbsp; Seller hereby covenants and
agrees to indemnify and hold Purchaser harmless, in accordance with this <u>Article
VII</u>, from and against any and all Liabilities or Losses which Purchaser may
incur as a result of any failure to comply with any applicable bulk sales laws
in connection with this Agreement.</font></a></p>
<p style='margin-left:0pt; text-indent:0.5in' align="justify">&nbsp;</p>
<p style='margin-left:0pt' align="center"><font size="2">16</font></p>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=624
 style='width:468.0pt;border-collapse:collapse'>
 <tr>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=120 valign=bottom style='width:90.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>

  &nbsp;</td>
 </tr>
</table>



<div class=MsoNormal align=center style='text-align:center'>

<hr noshade color=navy align=justify>

</div>



<b><u><font size="2"><br
clear=all style='page-break-before:always'>
</font>
</u></b>









<p style='margin-left:0pt; text-indent:0.5in' align="justify"><font size="2">7.10&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<b>&nbsp; <u>Indemnification Cap</u></b>.&nbsp;
Notwithstanding any provision herein to the contrary, the total liability of
Seller to indemnify and hold Purchaser harmless pursuant to this <u>Article VII</u>
shall be limited to $650,000 in the aggregate.</font></p>

<p style='margin-left:0pt;text-indent:0pt' align="center"><b><font size="2">ARTICLE
VIII</font></b><font size="2"><br>
</font>
<a name="_Toc115780233"><b><u><font size="2">MISCELLANEOUS</font></u></b></a></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780234">
<font size="2">8.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<b><u>Notices</u></b>.&nbsp; All notices, requests,
demands, and other communications called for by this Agreement shall be in
writing and shall be deemed to have been given if delivered or mailed first
class, postage prepaid:</font></a></p>

<p align=justify style='margin-left:108.0pt;'><font size="2">If to
Seller, to:<br>
IntraVantage, Inc.<br>
2950 Xenium Lane North, Suite 148<br>
Plymouth, Minnesota 55441-2623<br>
Attn: </font> <u><font size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</font> </u></p>



<p align=justify style='margin-left:108.0pt;page-break-after:avoid'>
<font size="2">If to Purchaser, to:<br>
Pro-Dex, Inc.<br>
151 East Columbine Avenue<br>
Santa Ana, California 92707<br>
Attn: Patrick Johnson</font></p>

<p align=justify style='margin-left:108.0pt;'><font size="2">With
copy to:<br>
Rutan &amp; Tucker, LLP<br>
611 Anton Blvd., 14<sup>th</sup> Floor<br>
Costa Mesa, California 92626-1931<br>
Attn: Thomas J. Crane</font></p>

<p align=justify style='margin-left:72.0pt;'><font size="2">In the
event any party shall change its address contained in this <u>Section 8.1</u>
such party shall provide the other party to this Agreement notification of such
change in accordance with this <u>Section 8.1</u>.</font></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780235">
<font size="2">8.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<b><u>Counterparts</u></b>.&nbsp; For the convenience
of the parties hereto, this Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original but all of which
together shall constitute one and the same instrument.</font></a></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780236">
<font size="2">8.3&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<b><u>Headings</u></b>.&nbsp; The headings of the
several articles and sections herein are inserted for convenience of reference
only and are not intended to be a part of, or affect the meaning of
interpretation of, this Agreement.</font></a></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780237">
<font size="2">8.4&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<b><u>Parties in Interest</u></b>.&nbsp; This
Agreement shall benefit and bind the parties and their respective successors
and assigns.</font></a></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780238">
<font size="2">8.5&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<b><u>Governing Law</u></b>.&nbsp; This Agreement
shall be construed and enforced in accordance with the laws of the State of
California, without reference to the choice of law principles thereof.</font></a></p>
<p style='margin-left:0pt; text-indent:0.5in' align="justify">&nbsp;</p>
<p style='margin-left:0pt' align="center"><font size="2">17</font></p>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=624
 style='width:468.0pt;border-collapse:collapse'>
 <tr>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=120 valign=bottom style='width:90.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>

  &nbsp;</td>
 </tr>
</table>



<div class=MsoNormal align=center style='text-align:center'>

<hr noshade color=navy align=justify>

</div>



<b><u><font size="2"><br
clear=all style='page-break-before:always'>
</font>
</u></b>









<p style='margin-left:0pt; text-indent:0.5in' align="justify"><font size="2">8.6&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<b><u>Amendment</u></b>.&nbsp; This Agreement may be
amended by written instrument executed by both Seller and Purchaser.</font></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780240">
<font size="2">8.7&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<b><u>Entire Agreement</u></b>.&nbsp; This Agreement,
including the agreements referenced herein, contain the entire understanding of
the parties relating to the subject matter hereof and supersede any prior
agreements, written or oral, with respect to the same subject matter.&nbsp; The
Attachments, Exhibits and Schedules identified in this Agreement are
incorporated in and made a part of this Agreement by reference.</font></a></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780241">
<font size="2">8.8&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<b><u>Expenses</u></b>.&nbsp; Each party shall
separately bear the expenses incurred by it in connection with this Agreement;
provided, however, that if either party shall commence legal action to
specifically enforce or otherwise seek redress under or for breach of this
Agreement, the prevailing party in such action shall be entitled to recover its
costs and reasonable attorneys' fees therein, including costs and fees incurred
in any appellate proceeding.</font></a><font size="2">&nbsp; Seller shall be
entitled to recover from Purchaser all expenses (including reasonable
attorneys' fees and costs) incurred in conjunction with the collection of any
Installment Payments due pursuant to <u>Section&nbsp;2.2(b)</u>, except where
Purchaser's failure to pay any such Installment Payments is a result of
Purchaser's exercise of its offset rights pursuant to <u>Section&nbsp;7.4</u>.</font></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780242">
<font size="2">8.9&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<b><u>Waiver</u></b>.&nbsp; Any of the terms or
conditions of this Agreement may be waived at any time by the party which is
entitled to the benefit thereof.&nbsp; All such waivers shall be in writing and no
waiver by any party of any default, misrepresentation, or breach of warranty or
covenant hereunder, whether intentional or not, shall be deemed to extend to
any prior or subsequent default, misrepresentation, or breach of warranty or
covenant hereunder or affect in any way any rights arising by virtue of any
prior or subsequent such occurrence.</font></a></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><a name="_Toc115780243">
<font size="2">8.10&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; &nbsp;
<b><u>Construction</u></b>.&nbsp; The
parties have participated jointly in the negotiation and drafting of this
Agreement.&nbsp; In the event an ambiguity or question of intent or interpretation
arises, this Agreement shall be construed as if drafted jointly by the parties
an no presumption or burden of proof shall arise favoring or disfavoring any
party by virtue of the authorship of any of the provisions of the Agreement.&nbsp;
Any reference to any federal, state, local or foreign statute or law shall be
deemed also to refer to all rules and regulations promulgated thereunder,
unless the context requires otherwise.&nbsp; The parties intend that each
representation, warranty and covenant contained in this Agreement shall have
independent significance.&nbsp; If any party has breached any representation,
warranty or covenant contained herein in any respect, the fact that there
exists another representation, warranty or covenant relating to the same
subject matter (regardless of their relative levels of specificity) which the
parties have not breached shall not detract from or mitigate the fact that the
parties in breach of the first representation, warranty or covenant.</font></a></p>



<p align=center style='margin-top:0pt;text-indent:
0pt;line-height:1.0pt'><font size="2">[SIGNATURE PAGE FOLLOWS]</font></p>
<p align=center style='margin-top:0pt;text-indent:
0pt;line-height:1.0pt'>&nbsp;</p>
<p align=center style='margin-top:0pt;text-indent:
0pt;line-height:1.0pt'>&nbsp;</p>
<p align=center style='margin-top:0pt;text-indent:
0pt;line-height:1.0pt'>&nbsp;</p>
<p align=center style='margin-top:0pt;text-indent:
0pt;line-height:1.0pt'>&nbsp;</p>
<p align=center style='margin-top:0pt;text-indent:
0pt;line-height:1.0pt'>&nbsp;</p>
<p align=center style='margin-top:0pt;text-indent:
0pt;line-height:1.0pt'>&nbsp;</p>
<p align=center style='margin-top:0pt;text-indent:
0pt;line-height:1.0pt'>&nbsp;</p>
<p align=center style='margin-top:0pt;text-indent:
0pt;line-height:1.0pt'><font size="2">18</font></p>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=624
 style='width:468.0pt;border-collapse:collapse'>
 <tr>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=120 valign=bottom style='width:90.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>

  &nbsp;</td>
 </tr>
</table>



<div class=Body align=center style='margin-top:0pt;text-align:center;
text-indent:0pt'>

<hr noshade color=navy align=justify>

</div>



<font size="2">



<br clear=all
style='page-break-before:always'>












</font>












<p align="justify" style="text-indent: 0.5in"><font size="2">IN WITNESS WHEREOF, Purchaser and Seller have executed this Asset
Purchase Agreement as of the date and year first above written.</font></p>

<p align=justify style='margin-left:216.0pt;text-indent:-216.0pt;page-break-after:avoid'>
<font size="2">PURCHASER:&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Pro-Dex,
Inc., a Colorado corporation<br>
<br>
<br>
By:<u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; /s/ Patrick Johnson&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </u><br>
<br>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Its:</font><u><font size="2">&nbsp; &nbsp; President and C.E.O.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</font> </u></p>



<p align=justify style='margin-left:216.0pt;text-indent:-216.0pt'>
<font size="2">SELLER:&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; IntraVantage,
Inc., a Delaware corporation<br>
<br>
<br>
By:<u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; /s/ Daniel W. Larkin&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </u><br>
<br>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Its:</font><u><font size="2">&nbsp; &nbsp; President and C.O.O.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</font> </u></p>
<p align=justify style='margin-left:216.0pt;text-indent:-216.0pt'>&nbsp;</p>
<p align=justify style='margin-left:216.0pt;text-indent:-216.0pt'>&nbsp;</p>
<p align="justify" style="text-indent: -216.0pt; margin-left: 216.0pt">&nbsp;</p>
<p align="justify" style="text-indent: -216.0pt; margin-left: 216.0pt">&nbsp;</p>
<p align="justify" style="text-indent: -216.0pt; margin-left: 216.0pt">&nbsp;</p>
<p align=center style='margin-left:216.0pt;text-indent:-216.0pt'><font size="2">19</font></p>



<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=624
 style='width:468.0pt;border-collapse:collapse'>
 <tr>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=120 valign=bottom style='width:90.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>

  &nbsp;</td>
 </tr>
</table>



<div class=MsoNormal align=center style='text-align:center'>

<hr noshade color=navy align=justify>

</div>







</body>

</html>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.2
<SEQUENCE>4
<FILENAME>ex10-21.htm
<TEXT>
<html>

<head>


<title>Exhibit 10.2</title>



</head>

<body lang=EN-US>











<p align=right style='text-align:justify'><b><font size="2">&nbsp;</font></b></p>



<p align=left style='text-align:justify'><b><font size="2">EXHIBIT 10.2</font></b></p>

<p align="center" style="text-indent: 0.5in"><b><font size="2">EXCLUSIVE LICENSE AGREEMENT</font></b></p>

<p align="justify" style="text-indent: 0.5in"><font size="2">THIS EXCLUSIVE LICENSE AGREEMENT (&quot;<u>Agreement</u>&quot;) is entered
into by and between Pro-Dex, Inc., a Colorado corporation (&quot;<u>Licensor</u>&quot;),
and IntraVantage, Inc., a Delaware corporation (&quot;<u>Licensee</u>&quot;), on and as
of October 31, 2005 (&quot;<u>Effective Date</u>&quot;). Each of the parties hereto is
sometimes referred to herein as a &quot;<u>Party</u>,&quot; and collectively as the &quot;<u>Parties</u>.&quot;</font></p>

<p align="justify" style="text-indent: 0.5in"><font size="2">WHEREAS, the Parties are concurrently herewith entering into the
Asset Purchase Agreement (as defined below), pursuant to which Licensor shall
purchase, among other assets, all of Licensee's right, title and interest in
and to the Licensed Intellectual Property, and</font></p>

<p align="justify" style="text-indent: 0.5in"><font size="2">WHEREAS, the Parties desire to evidence in writing certain rights
being granted by Licensor to Licensee with respect to the Licensed Intellectual
Property in the Authorized Fields of Use as set forth in this Agreement.</font></p>

<p align="justify" style="text-indent: 0.5in"><font size="2">NOW THEREFORE, in consideration of the Asset Purchase Agreement
and the foregoing recitals and the following covenants and promises, the
Parties hereby agree as follows:</font></p>

<p style='margin-left:0pt;text-indent:0pt' align="justify"><font size="2">1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<u>Definitions</u>.</font></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><font size="2">1.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<u>Asset Purchase Agreement</u>&quot; shall mean the Asset Purchase
Agreement between Licensee and Licensor dated as of the Effective Date, a copy
of which is attached hereto as <u>Exhibit B</u> and incorporated herein by
reference.</font></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><font size="2">1.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<u>Authorized Fields of Use</u>&quot; shall mean any non-dental product or
application.</font></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><font size="2">1.3&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<u>Licensed Intellectual Property</u>&quot; shall mean the intellectual
property (including any rights under patent law, copyright law, publicity
rights law, moral rights law, trade secret law, trademark law, unfair
competition law or similar protections related thereto) set forth on <u>Exhibit
A</u> attached hereto and incorporated herein by reference.</font></p>

<p style='margin-left:0pt;text-indent:0pt' align="justify"><font size="2">2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<u>Term</u>.&nbsp; This Agreement and the license
granted hereunder shall commence on the Effective Date and shall continue until
and unless terminated by written notice given by Licensee to Licensor (the &quot;<u>Term</u>&quot;).</font></p>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=624
 style='width:468.0pt;border-collapse:collapse'>
 <tr>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=120 valign=bottom style='width:90.0pt;padding:0pt 1.8pt 0pt 1.8pt'>

  &nbsp;</td>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>

  &nbsp;</td>
 </tr>
</table>



<div class=MsoNormal align=center style='text-align:center'>

<hr noshade color=navy align=justify>

</div>



<font size="2">



<br clear=all
style='page-break-before:always'>






</font>






<p align=right style='text-align:justify'><b><font size="2">&nbsp;</font></b></p>



<p style='margin-left:0pt;text-indent:0pt' align="justify"><font size="2">3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<u>Grant of License</u>.&nbsp; Pursuant to the terms and conditions of this
Agreement, Licensor hereby grants to Licensee for the Term of this Agreement an
exclusive (including, without limitation, to the exclusion of Licensor),
worldwide, irrevocable, royalty-free, perpetual right and license to use and
exploit any and all Licensed Intellectual Property in the Authorized Fields of
Use. For purposes of this Agreement, the license to use and exploit the
Licensed Intellectual Property in the Authorized Fields of Use hereunder shall
permit Licensee to make, adapt, modify, use, market, duplicate, sublicense,
import, export, sell and distribute any product or part thereof associated with
such Licensed Intellectual Property and to practice any methods or processes
associated therewith, and/or to otherwise make, adapt, modify, use, market,
duplicate, sublicense, import, export, sell, distribute or practice anything
associated therewith during the Term, so long as any and all of the foregoing
is conducted exclusively in the Authorized Fields of Use. </font> </p>

<p style='margin-left:0pt;text-indent:0pt' align="justify"><font size="2">4.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<u>Royalties</u>. Licensor's consideration for
the license granted herein shall be the consideration received by Licensor from
Licensee pursuant to the Asset Purchase Agreement.</font></p>

<p style='margin-left:0pt;text-indent:0pt' align="justify"><font size="2">5.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<u>Indemnification</u>. Licensee hereby agrees to
indemnify and hold harmless Licensor and its officers, directors, employees,
shareholders, agents and representatives from and against any loss, damage,
claim, injury, action, cost or expense (including, without limitation,
reasonable attorneys' and experts' fees and costs) arising out of or in
connection with (i) the use of the Licensed Intellectual Property in the
Authorized Fields of Use or (ii) any use of the Licensed Intellectual Property
in violation of this Agreement by Licensee or any third party who has gained
access to the Licensed Intellectual Property as a result of any act or omission
of Licensee.</font></p>

<p style='margin-left:0pt;text-indent:0pt' align="justify"><font size="2">6.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<u>WARRANTY DISCLAIMER</u>.&nbsp; THE LICENSED INTELLECTUAL PROPERTY IS
LICENSED TO LICENSEE &quot;AS IS.&quot;&nbsp; LICENSOR MAKES NO REPRESENTATION OR WARRANTY
REGARDING ITS RIGHT, TITLE, AUTHORITY AND/OR CAPACITY TO GRANT THE RIGHTS TO
LICENSEE PROVIDED FOR HEREIN NOR REGARDING ANY PENDING OR THREATENED, PATENT
INFRINGEMENT, TRADEMARK INFRINGEMENT OR OTHER CLAIMS OF ANY KIND WITH RESPECT
TO THE LICENSED INTELLECTUAL PROPERTY. WITHOUT LIMITING THE FOREGOING, LICENSOR
MAKES NO WARRANTY OR GUARANTEE THAT THE LICENSED INTELLECTUAL PROPERTY WILL NOT
IN THE FUTURE BE INVOLVED IN ANY INTERFERENCE, REISSUE, REEXAMINATION OR
OPPOSITION PROCEEDING; DOES NOT NOW INTERFERE OR WILL NOT IN THE FUTURE
INTERFERE WITH A PATENT OR PATENT APPLICATION OF ANY THIRD PARTY; OR IS NOT
NOW, OR WILL NOT IN THE FUTURE BE, INFRINGED, CHALLENGED OR THREATENED.
LICENSOR HEREBY DISCLAIMS ALL WARRANTIES, EXPRESS OR IMPLIED, INCLUDING,
WITHOUT LIMITATION, WARRANTIES OR CONDITIONS OF MERCHANTABILITY, SATISFACTORY
QUALITY, AND FITNESS FOR A PARTICULAR PURPOSE, OR IMPLIED WARRANTIES ARISING
FROM COURSE OF PERFORMANCE, COURSE OF DEALING OR USAGE OF TRADE.</font></p>

<p style='margin-left:0pt;text-indent:0pt' align="justify"><font size="2">7.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<u>LIMITATION OF LIABILITY</u>.&nbsp; LICENSOR SHALL NOT BE LIABLE FOR ANY
INDIRECT, INCIDENTAL, SPECIAL, PUNITIVE, OR CONSEQUENTIAL DAMAGES, OR ANY LOSS
OF PROFITS, REVENUE, DATA, OR DATA USE. </font> </p>

<p style='margin-left:0pt;text-indent:0pt' align="justify"><font size="2">8.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<u>Prosecution of Infringement</u>.</font></p>

<p style='margin-left:0pt; text-indent:0.75in' align="justify"><font size="2">8.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<u>Prosecution by Licensee</u>.&nbsp; Licensee shall have the right to
enforce its rights in and to the Licensed Intellectual Property in the
Authorized Fields of Use as granted herein.&nbsp; In such event, Licensor shall take
such action as is reasonably requested in writing by Licensee to assist
Licensee in enforcing such rights during the Term.&nbsp; Licensee shall bear all
costs and expenses associated with any such enforcement and shall promptly
reimburse Licensor for any and all costs and/or expenses (including, without
limitation, reasonable attorneys' and experts' fees and costs) incurred by
Licensor in assisting Licensee with such enforcement.</font></p>
<p style='margin-left:0pt' align="center"><font size="2">2</font></p>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=624
 style='width:468.0pt;border-collapse:collapse'>
 <tr>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=120 valign=bottom style='width:90.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>

  &nbsp;</td>
 </tr>
</table>



<div class=MsoNormal align=center style='text-align:center'>

<hr noshade color=navy align=justify>

</div>



<u><font size="2"><br clear=all
style='page-break-before:always'>
</font>
</u>





<p align=right style='text-align:justify'><b><font size="2">&nbsp;</font></b></p>



<p style='margin-left:0pt; text-indent:0.75in' align="justify"><font size="2">8.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<u>Prosecution by Licensor</u>.&nbsp; Licensor shall have the right, but not
the obligation, to enforce its rights in and to the Licensed Intellectual
Property, including, without limitation, in the Authorized Fields of Use.&nbsp; In
such event, Licensee shall take any and all such action as is reasonably
requested in writing by Licensor to assist Licensor in enforcing such rights.&nbsp;
Licensor shall bear all costs and expenses associated with any such enforcement
and shall reimburse Licensee for any and all costs and/or expenses (including,
without limitation, reasonable attorneys' and experts' fees and costs)
requested by Licensor and incurred by Licensee in assisting Licensor with such
enforcement.</font></p>

<p style='margin-left:0pt; text-indent:0.75in' align="justify"><font size="2">8.3&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<u>Joint Enforcement</u>. In the event both Parties engage in, or
otherwise become involved with, a proceeding whereby each Party is enforcing
its respective rights in and to Licensed Intellectual Property against a common
third party or third parties, then each Party shall bear its respective costs
and expenses (including, without limitation, reasonable attorneys' and experts'
fees and costs) associated with the enforcement of its rights; provided,
however, that in the event either Party incurs any costs or expenses
(including, without limitation, reasonable attorneys' and experts' fees and
costs) as a result of fulfilling a written request of the other Party, the
requesting Party shall promptly reimburse the other Party for such costs and/or
expenses.&nbsp; The Parties agree to cooperate and work together in good faith to
enforce their respective rights in any joint proceeding against a common third
party or third parties.</font></p>

<p style='margin-left:0pt; text-indent:0.75in' align="justify"><font size="2">8.4&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<u>Actions Between the Parties</u>.&nbsp; In the event of a claim or
proceeding by one Party against the other Party, none of <u>Sections 8.1, 8.2
or 8.3</u> shall apply to any such claim or proceeding.</font></p>

<p style='margin-left:0pt;text-indent:0pt' align="justify"><font size="2">9.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<u>Injunctive Relief</u>.&nbsp; Because a breach, or failure to comply with,
this Agreement will cause irreparable injury to Licensor for which there is no
adequate remedy at law and the exact amount of which will be difficult to
ascertain, if Licensee should in any way breach, or fail to comply with, the
terms of this Agreement, Licensor shall be entitled to seek and obtain an
injunction restraining Licensee from any such breach or failure without having
to prove monetary damages.&nbsp; All remedies expressly provided for herein are
cumulative of any and all other remedies now existing at law or in equity, to
the extent permitted under applicable law.&nbsp; Licensor shall, in addition to the
remedies herein provided, be entitled to avail itself of all such other
remedies as may now or hereafter exist at law or in equity for compensation,
and for the specific enforcement of the covenants contained herein without the
necessity of proving actual damages.&nbsp; Resort to any remedy provided for
hereunder or provided for by law shall not preclude or bar the concurrent or
subsequent employment of any other appropriate remedy or remedies, or preclude
the recovery by Licensor of monetary damages and compensation, including,
without limitation, Licensor's right to indemnification under the Asset
Purchase Agreement.</font></p>

<p style='margin-left:0pt;text-indent:0pt' align="justify"><font size="2">10.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<u>General</u>.</font></p>

<p style='margin-left:0pt; text-indent:0.75in' align="justify"><font size="2">10.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<u>Governing Law and Venue</u>. This Agreement shall be governed by and
interpreted in accordance with the laws of the State of California, without
reference to the choice of law principles thereof.&nbsp; All disputes concerning the
validity, interpretation, or performance of this Agreement and any of its terms
or provisions, or of any rights or obligations of the parties hereto, shall be
resolved in and with exclusive venue in the Superior Courts of Orange County,
California, and the Parties hereby agree to submit to the exclusive venue of
such court. </font> </p>
<p style='margin-left:0pt; text-indent:0.75in' align="justify">&nbsp;</p>
<p style='margin-left:0pt' align="center"><font size="2">3</font></p>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=624
 style='width:468.0pt;border-collapse:collapse'>
 <tr>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=120 valign=bottom style='width:90.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>

  &nbsp;</td>
 </tr>
</table>



<div class=MsoNormal align=center style='text-align:center'>

<hr noshade color=navy align=justify>

</div>



<u><font size="2"><br clear=all
style='page-break-before:always'>
</font>
</u>





<p align=right style='text-align:justify'><b><font size="2">&nbsp;</font></b></p>



<p style='margin-left:0pt; text-indent:0.75in' align="justify"><font size="2">10.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<u>Notice</u>. All notices, including notices of address change,
required to be sent hereunder shall be in writing and shall be deemed to have
been given (i) 48 hours after being sent certified or registered mail, postage
prepaid, or (ii) 24 hours after being send via a reputable overnight courier,
to:</font></p>

<p align=left style='margin-left:72.0pt;text-align:justify;
text-indent:-72.0pt'><font size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; If to IntraVantage:<br>
<br>
IntraVantage, Inc.<br>
2950 Xenium Lane North, Suite 148<br>
Plymouth, Minnesota, 55441-2623<br>
Attn:_______________<br>
<br>
<br>
If to Pro-Dex:<br>
<br>
Pro-Dex, Inc.<br>
151 East Columbine Avenue<br>
Santa Ana, California 92707<br>
Attn:&nbsp;&nbsp;&nbsp;&nbsp; Patrick Johnson<br>
<br>
<br>
With a copy to:<br>
<br>
(which shall not constitute notice to Pro-Dex):<br>
<br>
Rutan &amp; Tucker, LLP<br>
611 Anton Blvd., Fourteenth Floor<br>
Costa Mesa, California 92626<br>
Attn: Thomas J. Crane, Esq.<br>
Phone: (714) 641-5100<br>
Facsimile: (714) 546-9035</font></p>

<p style='margin-left:0pt; text-indent:0.75in' align="justify"><font size="2">10.3&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<u>Export Administration</u>. Licensee agrees to comply with all
relevant export laws and regulations of the United States and the country or
territory in which any products based upon or incorporating the Licensed
Intellectual Property are delivered (&quot;<u>Export Laws</u>&quot;) to assure that no
product is (1) exported, directly or indirectly, in violation of Export Laws or
(2) intended to be used for any purposes prohibited by the Export Laws.</font></p>

<p style='margin-left:0pt; text-indent:0.75in' align="justify"><font size="2">10.4&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<u>Headings</u>. The headings appearing in this Agreement are inserted
for convenience only, and will not be used to define, limit or enlarge the
scope of this Agreement or any of the obligations herein.</font></p>

<p style='margin-left:0pt; text-indent:0.75in' align="justify"><font size="2">10.5&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; &nbsp;&nbsp;&nbsp;&nbsp;<u>Counterparts</u>. This Agreement may be executed in counterparts,
each of which will be an original, and such counterparts together will
constitute one and the same instrument. Execution may be effected by delivery
of facsimiles of signature pages (and the Parties will follow such delivery by
prompt delivery of originals of such pages).</font></p>
<p style='margin-left:0pt; text-indent:0.75in' align="justify">&nbsp;</p>
<p style='margin-left:0pt' align="center"><font size="2">4</font></p>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=624
 style='width:468.0pt;border-collapse:collapse'>
 <tr>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=120 valign=bottom style='width:90.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>

  &nbsp;</td>
 </tr>
</table>



<div class=MsoNormal align=center style='text-align:center'>

<hr noshade color=navy align=justify>

</div>



<u><font size="2"><br clear=all
style='page-break-before:always'>
</font>
</u>





<p align=right style='text-align:justify'><b><font size="2">&nbsp;</font></b></p>



<p style='margin-left:0pt; text-indent:0.75in' align="justify"><font size="2">10.6&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<u>Compliance with Law</u>. Each Party agrees to comply with all
federal, state and local laws and regulations applicable to this Agreement.</font></p>

<p style='margin-left:0pt; text-indent:0.75in' align="justify"><font size="2">10.7&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<u>Successors and Assigns</u>. Licensee shall provide Licensor thirty
(30) days written notice prior to any assignment of this Agreement or any of
its rights hereunder, including, without limitation, any transfer, assignment
or sublicense of the Licensed Intellectual Property.&nbsp; Any attempted assignment
by Licensee without providing Licensor such thirty (30) days prior written
notice shall be void. This Agreement shall be binding upon and shall inure to
the benefit of the parties hereto and their respective successors and assigns.</font></p>

<p style='margin-left:0pt; text-indent:0.75in' align="justify"><font size="2">10.8&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<u>Waiver</u>.&nbsp; No waiver by either Party of any breach shall be deemed
as a waiver of any prior or subsequent breach of the same or any other
provision of this Agreement.</font></p>

<p style='margin-left:0pt; text-indent:0.75in' align="justify"><font size="2">10.9&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<u>Integration</u>. This Agreement, along with the Asset Purchase
Agreement and the agreements referenced therein, represents the entire
understanding of the Parties with respect to the subject matter hereof and
supersedes all previous representations, understandings or agreements, oral or
written.&nbsp; Any modification to this Agreement must be in writing signed by the
Party against whom such modification is to be enforced.</font></p>

<p style='margin-left:0pt; text-indent:0.75in' align="justify"><font size="2">
10.10&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<u>Authority</u>. Each Party represents and warrants that the person
signing this Agreement on its behalf has full right, power and authority to
bind such Party and such execution of this Agreement has been duly authorized.</font></p>

<p style='margin-left:0pt; text-indent:0.75in' align="justify"><font size="2">10.11&nbsp;&nbsp;&nbsp;&nbsp; &nbsp;
<u>Attorneys' Fees</u>. If any action, at law or in equity, is necessary
to enforce or interpret this Agreement, the prevailing Party shall be entitled
to recover reasonable attorneys' fees, costs and necessary disbursements from
the non-successful Party in addition to any other relief to which it may be
entitled.</font></p>

<p align="center"><font size="2">[SIGNATURES CONTAINED ON THE FOLLOWING PAGE]</font></p>
<p align="center">&nbsp;</p>
<p align="center">&nbsp;</p>
<p align="center"><font size="2">5</font></p>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=624
 style='width:468.0pt;border-collapse:collapse'>
 <tr>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=120 valign=bottom style='width:90.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>

  &nbsp;</td>
 </tr>
</table>



<div class=MsoNormal align=center style='text-align:center'>

<hr noshade color=navy align=justify>

</div>



<font size="2">



<br clear=all
style='page-break-before:always'>






</font>






<p align=right style='text-align:justify'><b><font size="2">&nbsp;</font></b></p>



<p align="justify" style="text-indent: 0.5in"><font size="2">INTENDING TO BE LEGALLY BOUND, the parties have executed this
Agreement on and as of the Effective Date set forth above.</font></p>



<p align="justify"><u><font size="2">LICENSOR</font></u><font size="2">:&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <u>LICENSEE</u>:&nbsp;&nbsp;&nbsp;&nbsp;
</font> </p>

<p align=left style='text-align:justify'><b><font size="2">PRO-DEX, INC.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; INTRAVANTAGE,
INC.</font></b><font size="2"><br>
<br>
<br>
By: <u>&nbsp;&nbsp;/s/ Patrick Johnson&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; By:
<u>&nbsp;&nbsp;/s/ Daniel W. Larkin&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </u><br>
</font>
</p>

<p align=left style='margin-top:0pt;text-align:justify'><font size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Its:
<u>&nbsp;President &amp; C.E.O.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Its:
</font>
<u><font size="2">&nbsp;President &amp; C.O.O.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</font> </u></p>
<p align=left style='margin-top:0pt;text-align:justify'>&nbsp;</p>
<p align=left style='margin-top:0pt;text-align:justify'>&nbsp;</p>
<p align=left style='margin-top:0pt;text-align:justify'>&nbsp;</p>
<p align=left style='margin-top:0pt;text-align:justify'>&nbsp;</p>
<p align=left style='margin-top:0pt;text-align:center'><font size="2">6</font></p>



<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=624
 style='width:468.0pt;border-collapse:collapse'>
 <tr>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=120 valign=bottom style='width:90.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>

  &nbsp;</td>
 </tr>
</table>



<div class=MsoNormal align=center style='text-align:center'>

<hr noshade color=navy align=justify>

</div>





<font size="2">





<br clear=all
style='page-break-before:always'>








</font>








<p align=right style='text-align:justify'><b><font size="2">&nbsp;</font></b></p>



<p style='margin-top:0pt' align="center"><b><font size="2">EXHIBIT A</font></b></p>

<p style='margin-top:0pt' align="center"><b><font size="2">TO</font></b></p>

<p style='margin-top:0pt' align="center"><b><font size="2">EXCLUSIVE LICENSE AGREEMENT</font></b></p>

<p align="center"><font size="2">Licensed Intellectual Property</font></p>



<p style='text-indent:0pt' align="justify"><u><font size="2">Patents</font></u></p>

<p align=left style='margin-left:36.0pt;text-align:justify;text-indent:-36.0pt'>
<font size="2">1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;United States<br>
Patent No. 5,927,976<br>
Issued</font></p>

<p align=left style='margin-left:36.0pt;text-align:justify;text-indent:-36.0pt'>
<font size="2">2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;United States<br>
Patent No. 6,626,887<br>
Issued</font></p>

<p align=left style='text-align:justify;text-indent:0pt'><u><font size="2">Patent
Applications</font></u></p>

<p align=left style='margin-left:36.0pt;text-align:justify;text-indent:-36.0pt'>
<font size="2">3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;United States<br>
Cont. Appl. No. 10/662,744<br>
Pending</font></p>

<p align=left style='margin-left:36.0pt;text-align:justify;text-indent:-36.0pt'>
<font size="2">4.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Canada<br>
Appl. No. 2253897<br>
Pending</font></p>

<p align=left style='margin-left:36.0pt;text-align:justify;text-indent:-36.0pt'>
<font size="2">5.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Europe<br>
Appl. No. 97933174.1<br>
Pending</font></p>

<p align=left style='margin-left:36.0pt;text-align:justify;text-indent:-36.0pt'>
<font size="2">6.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Japan<br>
Appl. No. 10546927<br>
Pending</font></p>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=624
 style='width:468.0pt;border-collapse:collapse'>
 <tr>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=120 valign=bottom style='width:90.0pt;padding:0pt 1.8pt 0pt 1.8pt'>

  &nbsp;</td>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>

  &nbsp;</td>
 </tr>
</table>



<div class=MsoNormal align=center style='text-align:center'>

<hr noshade color=navy align=justify>

</div>



<font size="2">



<br clear=all
style='page-break-before:always'>






</font>






<p align=right style='text-align:justify'><b><font size="2">&nbsp;</font></b></p>



<p align="center"><b><font size="2">EXHIBIT B</font></b></p>

<p style='margin-top:0pt' align="center"><b><font size="2">TO</font></b></p>

<p style='margin-top:0pt' align="center"><b><font size="2">EXCLUSIVE LICENSE AGREEMENT</font></b></p>

<p align="center"><font size="2">Asset Purchase Agreement</font></p>

<p align="center"><font size="2">[Attached]</font></p>
<p align="center">&nbsp;</p>
<p align="center">&nbsp;</p>
<p align="center">&nbsp;</p>
<p align="center">&nbsp;</p>
<p align="center">&nbsp;</p>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=624
 style='width:468.0pt;border-collapse:collapse'>
 <tr>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=120 valign=bottom style='width:90.0pt;padding:0pt 1.8pt 0pt 1.8pt'>

  &nbsp;</td>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>

  &nbsp;</td>
 </tr>
</table>



<div class=MsoNormal align=center style='text-align:center'>

<hr noshade color=navy align=justify>

</div>







</body>

</html>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.3
<SEQUENCE>5
<FILENAME>ex10-31.htm
<TEXT>
<html>

<head>


<title>Exhibit 10.3</title>



</head>

<body lang=EN-US>











<p align=right style='text-align:justify'><b><font size="2">&nbsp;</font></b></p>



<p align=left style='text-align:justify'><b><font size="2">EXHIBIT 10.3</font></b></p>

<p align="center"><b><font size="2">ROYALTY AGREEMENT</font></b></p>

<p align="justify" style="text-indent: 0.5in"><font size="2">THIS ROYALTY AGREEMENT (&quot;<u>Agreement</u>&quot;) is entered into by
and between Pro-Dex, Inc., a Colorado corporation (&quot;<u>Pro-Dex</u>&quot;), and
IntraVantage, Inc., a Delaware corporation (&quot;<u>IntraVantage</u>&quot;), on and as
of October 31, 2005 (&quot;<u>Effective Date</u>&quot;). Each of the parties hereto is
sometimes referred to herein as a &quot;<u>Party</u>,&quot; and collectively as the &quot;<u>Parties</u>.&quot;</font></p>

<p align="justify" style="text-indent: 0.5in"><font size="2">WHEREAS, the Parties are concurrently herewith entering into the
Asset Purchase Agreement (as defined below), pursuant to which Pro-Dex shall
purchase, among other assets, IntraVantage's right, title and interest in and
to the Purchased Intellectual Property (as that term is defined in the Asset
Purchase Agreement), and</font></p>

<p align="justify" style="text-indent: 0.5in"><font size="2">WHEREAS, the Parties desire to evidence in writing certain
royalty payments to be paid by Pro-Dex to IntraVantage in further consideration
for the Purchased Intellectual Property.</font></p>

<p align="justify" style="text-indent: 0.5in"><font size="2">NOW THEREFORE, in consideration of the Asset Purchase Agreement
and the foregoing recitals and the following covenants and promises, the
Parties hereby agree as follows:</font></p>

<p style='margin-left:0pt;text-indent:0pt' align="justify"><font size="2">1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<u>Definitions</u>.</font></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><font size="2">1.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<u>Asset Purchase Agreement</u>&quot; shall mean the Asset Purchase
Agreement between Pro-Dex and IntraVantage dated as of the Effective Date, a
copy of which is attached hereto as <u>Exhibit B</u> and incorporated herein by
reference.</font></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><font size="2">1.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<u>Combined Products</u>&quot; shall mean those products that incorporate
any one or more Patented Products.</font></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><font size="2">1.3&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<u>Derivative Products</u>&quot; shall mean those products that are a
modification of or substantially derived from the Patents.</font></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><font size="2">1.4&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<u>Patented Products</u>&quot; shall mean those products that fall within
the scope of one or more of the patent claims of the Patents and are not
Combined Products. </font> </p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><font size="2">1.5&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<u>Patents</u>&quot; shall mean any registered patent included in the
Purchased Intellectual Property and set forth on <u>Exhibit A</u> attached
hereto and incorporated by reference.</font></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><font size="2">1.6&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&quot;<u>Purchased Intellectual Property</u>&quot; shall have the meaning set
forth in the Asset Purchase Agreement.</font></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><font size="2">1.7&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; &nbsp;&nbsp;
<u>Other Terms</u>.&nbsp; Other capitalized terms used but not defined herein
shall have the meaning ascribed to them in the Asset Purchase Agreement.</font></p>

<p style='margin-left:0pt;text-indent:0pt' align="justify"><font size="2">2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<u>Term</u>.</font></p>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=624
 style='width:468.0pt;border-collapse:collapse'>
 <tr>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=120 valign=bottom style='width:90.0pt;padding:0pt 1.8pt 0pt 1.8pt'>

  &nbsp;</td>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>

  &nbsp;</td>
 </tr>
</table>



<div class=MsoNormal align=center style='text-align:center'>

<hr noshade color=navy align=justify>

</div>



<font size="2">



<br clear=all
style='page-break-before:always'>






</font>






<p align=right style='text-align:justify'>&nbsp;</p>



<p align="justify" style="text-indent: 0.5in"><font size="2">This Agreement and the royalty payments required hereunder shall
commence on the Effective Date and shall continue until the latest date on
which any of the Patents expire, unless earlier terminated in writing and
signed by both Parties (the &quot;<u>Term</u>&quot;).</font></p>

<p style='margin-left:0pt;text-indent:0pt;page-break-after:avoid' align="justify">
<font size="2">3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<u>Royalty Payment</u>.&nbsp; </font> </p>

<p style='margin-left:0pt;page-break-after:avoid; text-indent:0.5in' align="justify">
<font size="2">3.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Pursuant to the terms and conditions of this Agreement, Pro-Dex shall
pay IntraVantage a royalty payment on Net Sales (as defined below) of Patented
Products and Combined Products in accordance with the schedule set forth
below.&nbsp; &quot;Net Sales&quot; shall be calculated as follows: (i) for Patented Products,
Net Sales shall equal the aggregate gross sales revenue to Pro-Dex generated by
sales of Patented Products, less returns and (ii) for Combined Products, Net
Sales shall equal the aggregate of the then current stand alone price(s) of the
Patented Products included within each Combined Product multiplied by the
number of Combined Products sold, less returns of Combined Products.&nbsp; For
purposes of example only, with respect to the calculation of Net Sales for
Combined Products, and assuming no returns, if (i) each Combined Product A
incorporated one of Patented Product Y (with a stand alone price of $10) and
two of Patented Product Z (with a stand alone price of $20 each), and (ii)
Pro-Dex sold 10 units of Combined Product A at a price per unit of $10,000,
then (iii) the Net Sales would equal $500 (based on the following calculation
(($10 Patented Product Y stand alone price + [2 multiplied by $20 Patented
Product Z stand alone price]) multiplied by 10 units = $500).:</font></p>



<div align="left">



<table class=MsoNormalTable border=1 cellspacing=0 cellpadding=0 width=649
 style='width:740px;border-collapse:collapse;border:medium none; '>
 <tr>
  <td width=103 valign=top style='width:76.9pt;border:solid windowtext 1.0pt;
  padding:0pt 5.4pt 0pt 5.4pt' align="center">
  <p align=center><font size="2">One-Year Period
  Following <br>
  Effective Date</font></p>
  </td>
  <td width=130 valign=top style='width:97.7pt;border:solid windowtext 1.0pt;
  border-left:none;padding:0pt 5.4pt 0pt 5.4pt' align="center">
  <p align=center><font size="2">No Royalty Paid <br>
  on Net Sales Volume Up To:</font></p>
  </td>
  <td width=142 valign=top style='width:106.8pt;border:solid windowtext 1.0pt;
  border-left:none;padding:0pt 5.4pt 0pt 5.4pt' align="center">
  <p align=center><font size="2">10% Royalty Paid on
  Net Sales Volume Between:</font></p>
  </td>
  <td width=144 valign=top style='width:108.0pt;border:solid windowtext 1.0pt;
  border-left:none;padding:0pt 5.4pt 0pt 5.4pt' align="center">
  <p align=center><font size="2">12.5% Royalty Paid
  on Net Sales Volume Between:</font></p>
  </td>
  <td width=130 valign=top style='width:97.5pt;border:solid windowtext 1.0pt;
  border-left:none;padding:0pt 5.4pt 0pt 5.4pt' align="center">
  <p align=center><font size="2">15% Royalty Paid <br>
  on Net Sales Volume in Excess of:</font></p>
  </td>
 </tr>
 <tr>
  <td width=103 valign=top style='width:76.9pt;border:solid windowtext 1.0pt;
  border-top:none;padding:0pt 5.4pt 0pt 5.4pt'>
  <p style='margin-top:0pt' align="justify"><font size="2">1</font><sup><font size="2">st</font></sup></p>
  </td>
  <td width=130 valign=top style='width:97.7pt;border-top:none;border-left:
  none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
  padding:0pt 5.4pt 0pt 5.4pt'>
  <p style='margin-top:0pt' align="justify"><font size="2">&nbsp;$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 527,000.00</font></p>
  </td>
  <td width=142 valign=top style='width:106.8pt;border-top:none;border-left:
  none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
  padding:0pt 5.4pt 0pt 5.4pt'>
  <p style='margin-top:0pt' align="justify"><font size="2">$527,000.01 to $658,750.00</font></p>
  </td>
  <td width=144 valign=top style='width:108.0pt;border-top:none;border-left:
  none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
  padding:0pt 5.4pt 0pt 5.4pt'>
  <p style='margin-top:0pt' align="justify"><font size="2">$658,750.01 to $795,000.00</font></p>
  </td>
  <td width=130 valign=top style='width:97.5pt;border-top:none;border-left:
  none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
  padding:0pt 5.4pt 0pt 5.4pt'>
  <p style='margin-top:0pt' align="justify"><font size="2">&nbsp;$&nbsp;&nbsp;&nbsp;&nbsp; 795,000.00</font></p>
  </td>
 </tr>
 <tr>
  <td width=103 valign=top style='width:76.9pt;border:solid windowtext 1.0pt;
  border-top:none;padding:0pt 5.4pt 0pt 5.4pt'>
  <p style='margin-top:0pt' align="justify"><font size="2">2</font><sup><font size="2">nd</font></sup></p>
  </td>
  <td width=130 valign=top style='width:97.7pt;border-top:none;border-left:
  none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
  padding:0pt 5.4pt 0pt 5.4pt'>
  <p style='margin-top:0pt' align="justify"><font size="2">&nbsp;$&nbsp;&nbsp;&nbsp; 1,756,000.00</font></p>
  </td>
  <td width=142 valign=top style='width:106.8pt;border-top:none;border-left:
  none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
  padding:0pt 5.4pt 0pt 5.4pt'>
  <p style='margin-top:0pt' align="justify"><font size="2">$1,756,000.01 to $2,195,000.00</font></p>
  </td>
  <td width=144 valign=top style='width:108.0pt;border-top:none;border-left:
  none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
  padding:0pt 5.4pt 0pt 5.4pt'>
  <p style='margin-top:0pt' align="justify"><font size="2">$2,195,000.01 to $2,634,000.00</font></p>
  </td>
  <td width=130 valign=top style='width:97.5pt;border-top:none;border-left:
  none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
  padding:0pt 5.4pt 0pt 5.4pt'>
  <p style='margin-top:0pt' align="justify"><font size="2">&nbsp;$&nbsp;&nbsp;&nbsp; 2,634,000.00</font></p>
  </td>
 </tr>
 <tr>
  <td width=103 valign=top style='width:76.9pt;border:solid windowtext 1.0pt;
  border-top:none;padding:0pt 5.4pt 0pt 5.4pt'>
  <p style='margin-top:0pt' align="justify"><font size="2">3</font><sup><font size="2">rd</font></sup></p>
  </td>
  <td width=130 valign=top style='width:97.7pt;border-top:none;border-left:
  none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
  padding:0pt 5.4pt 0pt 5.4pt'>
  <p style='margin-top:0pt' align="justify"><font size="2">&nbsp;$&nbsp;&nbsp;&nbsp; 4,555,000.00</font></p>
  </td>
  <td width=142 valign=top style='width:106.8pt;border-top:none;border-left:
  none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
  padding:0pt 5.4pt 0pt 5.4pt'>
  <p style='margin-top:0pt' align="justify"><font size="2">$4,555,000.01 to $5,693,750.00</font></p>
  </td>
  <td width=144 valign=top style='width:108.0pt;border-top:none;border-left:
  none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
  padding:0pt 5.4pt 0pt 5.4pt'>
  <p style='margin-top:0pt' align="justify"><font size="2">$5,693,750.01 to $6,832,500.00</font></p>
  </td>
  <td width=130 valign=top style='width:97.5pt;border-top:none;border-left:
  none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
  padding:0pt 5.4pt 0pt 5.4pt'>
  <p style='margin-top:0pt' align="justify"><font size="2">&nbsp;$&nbsp;&nbsp;&nbsp; 6,832,500.00</font></p>
  </td>
 </tr>
 <tr>
  <td width=103 valign=top style='width:76.9pt;border:solid windowtext 1.0pt;
  border-top:none;padding:0pt 5.4pt 0pt 5.4pt'>
  <p style='margin-top:0pt' align="justify"><font size="2">4</font><sup><font size="2">th</font></sup></p>
  </td>
  <td width=130 valign=top style='width:97.7pt;border-top:none;border-left:
  none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
  padding:0pt 5.4pt 0pt 5.4pt'>
  <p style='margin-top:0pt' align="justify"><font size="2">&nbsp;$&nbsp;&nbsp;&nbsp; 7,125,000.00</font></p>
  </td>
  <td width=142 valign=top style='width:106.8pt;border-top:none;border-left:
  none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
  padding:0pt 5.4pt 0pt 5.4pt'>
  <p style='margin-top:0pt' align="justify"><font size="2">$7,125,000.01 to $8,902,250.00</font></p>
  </td>
  <td width=144 valign=top style='width:108.0pt;border-top:none;border-left:
  none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
  padding:0pt 5.4pt 0pt 5.4pt'>
  <p style='margin-top:0pt' align="justify"><font size="2">$8,902,250.01 to $10,687,500.00</font></p>
  </td>
  <td width=130 valign=top style='width:97.5pt;border-top:none;border-left:
  none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
  padding:0pt 5.4pt 0pt 5.4pt'>
  <p style='margin-top:0pt' align="justify"><font size="2">&nbsp;$&nbsp; 10,687,500.00</font></p>
  </td>
 </tr>
 <tr>
  <td width=103 valign=top style='width:76.9pt;border:solid windowtext 1.0pt;
  border-top:none;padding:0pt 5.4pt 0pt 5.4pt'>
  <p style='margin-top:0pt' align="justify"><font size="2">5</font><sup><font size="2">th</font></sup></p>
  </td>
  <td width=130 valign=top style='width:97.7pt;border-top:none;border-left:
  none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
  padding:0pt 5.4pt 0pt 5.4pt'>
  <p style='margin-top:0pt' align="justify"><font size="2">&nbsp;$&nbsp; 11,042,000.00</font></p>
  </td>
  <td width=142 valign=top style='width:106.8pt;border-top:none;border-left:
  none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
  padding:0pt 5.4pt 0pt 5.4pt'>
  <p style='margin-top:0pt' align="justify"><font size="2">$11,042,000.01 to $13,802,500.00</font></p>
  </td>
  <td width=144 valign=top style='width:108.0pt;border-top:none;border-left:
  none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
  padding:0pt 5.4pt 0pt 5.4pt'>
  <p style='margin-top:0pt' align="justify"><font size="2">$13,802,500.01 to $16,563,000.00</font></p>
  </td>
  <td width=130 valign=top style='width:97.5pt;border-top:none;border-left:
  none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
  padding:0pt 5.4pt 0pt 5.4pt'>
  <p style='margin-top:0pt' align="justify"><font size="2">&nbsp;$&nbsp; 16,563,000.00</font></p>
  </td>
 </tr>
</table>

</div>

<p align="justify" style="text-indent: 0.5in"><font size="2">For the period after the fifth anniversary of the Effective Date
until the last to expire of the Patents, a ten percent (10%) royalty payment
shall be paid on all Net Sales volume of Patented Products and Combined
Products.&nbsp; Notwithstanding any provision to the contrary in this Agreement, no
royalty payments shall be due on (i) Patented Products that fall within the
scope of the patent claim of a Patent that has expired or is otherwise
determined to be invalid or (ii) Patented Products that are incorporated into a
Combined Product, which Patented Products fall within the scope of the patent
claim of a Patent that has expired or is otherwise determined to be invalid.</font></p>
<p align="justify" style="text-indent: 0.5in">&nbsp;</p>
<p align="center"><font size="2">2</font></p>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=624
 style='width:468.0pt;border-collapse:collapse'>
 <tr>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=120 valign=bottom style='width:90.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>

  &nbsp;</td>
 </tr>
</table>



<div class=MsoNormal align=center style='text-align:center'>

<hr noshade color=navy align=justify>

</div>



<font size="2">



<br clear=all
style='page-break-before:always'>






</font>






<p align=right style='text-align:justify'><b><font size="2">&nbsp;</font></b></p>



<p style='margin-left:0pt; text-indent:0.5in' align="justify"><font size="2">3.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In addition to the royalty payments pursuant to <u>Section 3.1</u>,
Pro-Dex shall pay a ten percent (10%) royalty on gross revenues (less returns)
generated by any Derivative Products, after the offset of any and all expenses
incurred by Pro-Dex resulting from, or related to, the future development or
enhancement of the Patented Products and/or the Derivative Products.&nbsp; No
royalty payment shall be due on Derivative Products that are a modification of
or substantially derived from the Patents that have expired.&nbsp; For purposes of
clarity, Derivative Products shall only be subject to royalty payments pursuant
to this <u>Section 3.2</u> and not <u>Section 3.1</u>. Similarly, Patented
Products shall only be subject to royalty payments pursuant to <u>Section 3.1</u>
and not this <u>Section 3.2</u>.&nbsp; </font> </p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><font size="2">3.3&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The royalty payments payable by Pro-Dex to IntraVantage pursuant to <u>Sections&nbsp;3.1
and 3.2</u> shall be calculated by Pro-Dex each calendar quarter and shall be
paid by Pro-Dex within forty-five (45) days after the then ended quarter.</font></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><font size="2">3.4&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Pro-Dex shall keep detailed, true and accurate books of account with
respect to the sale of Patented Products and Derivative Products.&nbsp; IntraVantage's
appointed representatives may, upon ten (10) days written notice to Pro-Dex,
inspect and copy Pro-Dex's books and records as may be reasonably necessary to
verify the accuracy of the books of account relating to the Patented Products
and Derivative Products and royalty payments due to IntraVantage in conjunction
therewith.&nbsp; IntraVantage shall pay all fees and costs, including any cost
incurred by Pro-Dex, in conjunction with any such verification; provided,
however, that if the verification reveals an underpayment of five percent (5%)
or more, Pro-Dex shall make a correcting payment covering the reasonable
expenses incurred by IntraVantage in conjunction with such verification within
thirty (30) days of receipt of written notification of such expenses.</font></p>

<p style='margin-left:0pt;text-indent:0pt' align="justify"><font size="2">4.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<u>Offset</u>.&nbsp; Any and all royalty payments
otherwise due to IntraVantage hereunder shall be subject to Pro-Dex's right to
offset pursuant to Section 7.4 of the Asset Purchase Agreement.</font></p>

<p style='margin-left:0pt;text-indent:0pt' align="justify"><font size="2">5.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<u>General</u>.</font></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><font size="2">5.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<u>Governing Law and Venue</u>. This Agreement shall be governed by and
interpreted in accordance with the laws of the State of California, without
reference to the choice of law principles thereof.&nbsp; All disputes concerning the
validity, interpretation, or performance of this Agreement and any of its terms
or provisions, or of any rights or obligations of the Parties, shall be
resolved in and with exclusive venue in the Superior Courts of Orange County,
California, and the Parties hereby agree to submit to the exclusive venue of
such court. </font> </p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><font size="2">5.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<u>Notice</u>. All notices, including notices of address change,
required to be sent hereunder shall be in writing and shall be deemed to have
been given (i) 48 hours after being sent certified or registered mail, postage
prepaid, or (ii) 24 hours after being sent via a reputable overnight courier,
to:</font></p>
<p style='margin-left:0pt; text-indent:0.5in' align="justify">&nbsp;</p>
<p style='margin-left:0pt' align="center"><font size="2">3</font></p>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=624
 style='width:468.0pt;border-collapse:collapse'>
 <tr>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=120 valign=bottom style='width:90.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>

  &nbsp;</td>
 </tr>
</table>



<div class=MsoNormal align=center style='text-align:center'>

<hr noshade color=navy align=justify>

</div>



<font size="2">



<br clear=all
style='page-break-before:always'>






</font>






<p align=right style='text-align:justify'><b><font size="2">&nbsp;</font></b></p>



<p align=left style='margin-left:72.0pt;text-align:justify;
text-indent:-72.0pt'><font size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; If to IntraVantage:<br>
<br>
IntraVantage, Inc.<br>
2950 Xenium Lane North, Suite 148<br>
Plymouth, Minnesota, 55441-2623<br>
Attn:_______________<br>
Phone:&nbsp; _____________<br>
Fax:&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; _____________<br>
<br>
If to Pro-Dex:<br>
<br>
Pro-Dex, Inc.<br>
151 East Columbine Avenue<br>
Santa Ana, California 92707<br>
Attn:&nbsp;&nbsp;&nbsp;&nbsp; Patrick Johnson<br>
Phone:&nbsp; _____________<br>
Fax:&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; _____________<br>
<br>
With a copy to:<br>
<br>
(which shall not constitute notice to Pro-Dex):<br>
<br>
Rutan &amp; Tucker, LLP<br>
611 Anton Blvd., Fourteenth Floor<br>
Costa Mesa, California 92626<br>
Attn: Thomas J. Crane, Esq.<br>
Phone: (714) 641-5100<br>
Facsimile: (714) 546-9035</font></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><font size="2">5.3&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<u>Headings</u>. The headings appearing in this Agreement are inserted
for convenience only, and will not be used to define, limit or enlarge the
scope of this Agreement or any of the obligations herein.</font></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><font size="2">5.4&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<u>Counterparts</u>. This Agreement may be executed in counterparts,
each of which will be an original, and such counterparts together will
constitute one and the same instrument. Execution may be effected by delivery
of facsimiles of signature pages (and the Parties will follow such delivery by
prompt delivery of originals of such pages).</font></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><font size="2">5.5&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; &nbsp;&nbsp;<u>Compliance with Law</u>. Each Party agrees to comply with all
federal, state and local laws and regulations applicable to this Agreement.</font></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><font size="2">5.6&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<u>Successors and Assigns</u>. Pro-Dex may assign its rights and obligations
under this Agreement to any third party that acquires the right, title and
interest in and to the Patents. This Agreement shall be binding upon and shall
inure to the benefit of the parties hereto and their respective successors and
assigns.</font></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><font size="2">5.7&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<u>Waiver</u>.&nbsp; No waiver by either Party of any breach shall be deemed
as a waiver of any prior or subsequent breach of the same or any other
provision of this Agreement.</font></p>
<p style='margin-left:0pt; text-indent:0.5in' align="justify">&nbsp;</p>
<p style='margin-left:0pt' align="center"><font size="2">4</font></p>



<div class=MsoNormal align=center style='text-align:center'>

<hr noshade color=navy align=justify>

</div>



<u><font size="2"><br clear=all
style='page-break-before:always'>
</font>
</u>





<p align=right style='text-align:justify'><b><font size="2">&nbsp;</font></b></p>



<p style='margin-left:0pt; text-indent:0.5in' align="justify"><font size="2">5.8&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<u>Integration</u>. This Agreement, along with the Asset Purchase
Agreement and the agreements referenced therein, represents the entire
understanding of the Parties with respect to the subject matter hereof and
supersedes all previous representations, understandings or agreements, oral or
written.&nbsp; Any modification to this Agreement must be in writing signed by
the Party against whom such modification is to be enforced.</font></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><font size="2">5.9&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<u>Authority</u>. Each Party represents and warrants that the person signing
this Agreement on its behalf has full right, power and authority to bind such
Party and such execution of this Agreement has been duly authorized.</font></p>

<p style='margin-left:0pt; text-indent:0.5in' align="justify"><font size="2">5.10&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<u>Attorneys' Fees</u>. If any action, at law or in equity, is necessary to
enforce or interpret this Agreement, the prevailing Party shall be entitled to
recover reasonable attorneys' and experts' fees, costs and necessary
disbursements from the non-successful Party in addition to any other relief to
which it may be entitled.</font></p>

<p align="center"><font size="2">[SIGNATURES CONTAINED ON THE FOLLOWING PAGE]</font></p>
<p align="center">&nbsp;</p>
<p align="center">&nbsp;</p>
<p align="center">&nbsp;</p>
<p align="center">&nbsp;</p>
<p align="center">&nbsp;</p>
<p align="center">&nbsp;</p>
<p align="center"><font size="2">5</font></p>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=624
 style='width:468.0pt;border-collapse:collapse'>
 <tr>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=120 valign=bottom style='width:90.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>

  &nbsp;</td>
 </tr>
</table>



<div class=MsoNormal align=center style='text-align:center'>

<hr noshade color=navy align=justify>

</div>



<font size="2">



<br clear=all
style='page-break-before:always'>






</font>






<p align=right style='text-align:justify'><b><font size="2">&nbsp;</font></b></p>



<p align="justify" style="text-indent: 0.5in"><font size="2">INTENDING TO BE LEGALLY BOUND, the parties have executed this
Agreement on and as of the Effective Date set forth above.</font></p>



<p align=left style='text-align:justify'><b><font size="2">PRO-DEX, INC.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; INTRAVANTAGE,
INC.</font></b><font size="2"><br>
<br>
<br>
By: <u>&nbsp;/s/ Patrick Johnson&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; By:
</font>
<u><font size="2">&nbsp;/s/ Daniel W. Larkin&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</font> </u>
</p>

<p align=left style='margin-top:0pt;text-align:justify'><font size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Its:
<u>&nbsp;President and C.E.O.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Its:
</font> <u><font size="2">&nbsp;President
and C.O.O.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</font> </u></p>
<p align=left style='margin-top:0pt;text-align:justify'>&nbsp;</p>
<p align=left style='margin-top:0pt;text-align:justify'>&nbsp;</p>
<p align=left style='margin-top:0pt;text-align:justify'>&nbsp;</p>
<p align=left style='margin-top:0pt;text-align:justify'>&nbsp;</p>
<p align=left style='margin-top:0pt;text-align:justify'>&nbsp;</p>
<p align=left style='margin-top:0pt;text-align:center'><font size="2">6</font></p>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=624
 style='width:468.0pt;border-collapse:collapse'>
 <tr>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=120 valign=bottom style='width:90.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>

  &nbsp;</td>
 </tr>
</table>



<div class=MsoNormal align=center style='text-align:center'>

<hr noshade color=navy align=justify>

</div>





<font size="2">





<br clear=all
style='page-break-before:always'>








</font>








<p align=right style='text-align:justify'><b><font size="2">&nbsp;</font></b></p>



<p style='margin-top:0pt' align="center"><b><font size="2">EXHIBIT A</font></b></p>

<p style='margin-top:0pt' align="center"><b><font size="2">TO</font></b></p>

<p style='margin-top:0pt' align="center"><b><font size="2">ROYALTY AGREEMENT</font></b></p>

<p align="justify"><font size="2">Patents</font></p>

<p align=left style='text-align:justify;text-indent:0pt'><u><font size="2">Patents</font></u></p>

<p align=left style='margin-left:36.0pt;text-align:justify;text-indent:-36.0pt'>
<font size="2">1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;United States<br>
Patent No. 5,927,976<br>
Issued</font></p>

<p align=left style='margin-left:36.0pt;text-align:justify;text-indent:-36.0pt'>
<font size="2">2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;United States<br>
Patent No. 6,626,887<br>
Issued</font></p>

<p align=left style='text-align:justify;text-indent:0pt'><u><font size="2">Patent
Applications</font></u></p>

<p align=left style='margin-left:36.0pt;text-align:justify;text-indent:-36.0pt'>
<font size="2">3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;United States<br>
Cont. Appl. No. 10/662,744<br>
Pending</font></p>

<p align=left style='margin-left:36.0pt;text-align:justify;text-indent:-36.0pt'>
<font size="2">4.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Canada<br>
Appl. No. 2253897<br>
Pending</font></p>

<p align=left style='margin-left:36.0pt;text-align:justify;text-indent:-36.0pt'>
<font size="2">5.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Europe<br>
Appl. No. 97933174.1<br>
Pending</font></p>

<p align=left style='margin-left:36.0pt;text-align:justify;text-indent:-36.0pt'>
<font size="2">6.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Japan<br>
Appl. No. 10546927<br>
Pending</font></p>



<div class=MsoNormal align=center style='text-align:center'>

<hr noshade color=navy align=justify>

</div>



<font size="2">



<br clear=all
style='page-break-before:always'>






</font>






<p align=right style='text-align:justify'><b><font size="2">&nbsp;</font></b></p>



<p align="center"><b><font size="2">EXHIBIT B</font></b></p>

<p style='margin-top:0pt' align="center"><b><font size="2">TO</font></b></p>

<p style='margin-top:0pt' align="center"><b><font size="2">ROYALTY AGREEMENT</font></b></p>

<p align="center"><font size="2">Asset Purchase Agreement</font></p>

<p align="center"><font size="2">[Attached]</font></p>
<p align="center">&nbsp;</p>
<p align="center">&nbsp;</p>
<p align="center">&nbsp;</p>
<p align="center">&nbsp;</p>
<p align="center">&nbsp;</p>
<p align="center">&nbsp;</p>



<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=624
 style='width:468.0pt;border-collapse:collapse'>
 <tr>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>
  &nbsp;</td>
  <td width=120 valign=bottom style='width:90.0pt;padding:0pt 1.8pt 0pt 1.8pt'>

  &nbsp;</td>
  <td width=252 valign=bottom style='width:189.0pt;padding:0pt 1.8pt 0pt 1.8pt'>

  &nbsp;</td>
 </tr>
</table>



<div class=MsoNormal align=center style='text-align:center'>

<hr noshade color=navy align=justify>

</div>







</body>

</html>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>GRAPHIC
<SEQUENCE>6
<FILENAME>image001.jpg
<TEXT>
begin 644 image001.jpg
M_]C_X``02D9)1@`!`0$`8`!@``#_VP!#``H'!P@'!@H("`@+"@H+#A@0#@T-
M#AT5%A$8(Q\E)"(?(B$F*S<O)BDT*2$B,$$Q-#D[/CX^)2Y$24,\2#<]/CO_
MVP!#`0H+"PX-#AP0$!P[*"(H.SL[.SL[.SL[.SL[.SL[.SL[.SL[.SL[.SL[
M.SL[.SL[.SL[.SL[.SL[.SL[.SL[.SO_P``1"`!-`*\#`2(``A$!`Q$!_\0`
M'P```04!`0$!`0$```````````$"`P0%!@<("0H+_\0`M1```@$#`P($`P4%
M!`0```%]`0(#``01!1(A,4$&$U%A!R)Q%#*!D:$((T*QP152T?`D,V)R@@D*
M%A<8&1HE)B<H*2HT-38W.#DZ0T1%1D=(24I35%565UA96F-D969G:&EJ<W1U
M=G=X>7J#A(6&AXB)BI*3E)66EYB9FJ*CI*6FIZBIJK*SM+6VM[BYNL+#Q,7&
MQ\C)RM+3U-76U]C9VN'BX^3EYN?HZ>KQ\O/T]?;W^/GZ_\0`'P$``P$!`0$!
M`0$!`0````````$"`P0%!@<("0H+_\0`M1$``@$"!`0#!`<%!`0``0)W``$"
M`Q$$!2$Q!A)!40=A<1,B,H$(%$*1H;'!"2,S4O`58G+1"A8D-.$E\1<8&1HF
M)R@I*C4V-S@Y.D-$149'2$E*4U155E=865IC9&5F9VAI:G-T=79W>'EZ@H.$
MA8:'B(F*DI.4E9:7F)F:HJ.DI::GJ*FJLK.TM;:WN+FZPL/$Q<;'R,G*TM/4
MU=;7V-G:XN/DY>;GZ.GJ\O/T]?;W^/GZ_]H`#`,!``(1`Q$`/P#V:BBB@`HH
MHH`****`"BBFNX0>_I0`I(49)P*HKJ]O)/-!%DS0G#HWRD#L?<'UJ1F+G)K!
M\46CK9C5;5O*N[/Y@X_B3/(/J*J*3=BXI-ZEC_A(KA;@VLT$<-QU56)(D'JI
M[_3K4<GBBYMS^]M$=?\`98@U7!MO$.C022X220$KM/S(XZE?I61'+,TDMC>8
M-S!_$/\`EHO9JU44^AJHQ['3:=XQTF_<1-*;:4G&R;@$^QZ5N]:\5N(^6)&5
M+L/UK3T'QI=^'9TM[YGN=-8XYY:'Z>H]ORJG1O\`"$J-_A/6**BM[B&[MX[B
MWD66*10R.IR&![U+7,<X4444`%%%%`!1110`5@S>./"UO<RVT^O64,T+E)$D
ME"E6'!!S6]7R7XMO?[3\7ZM=KR)KN0KCTW$#]*`/I4^//"0Z^(]-_P#`A?\`
M&M#3=<TG6`3INI6MYMZB"57(^H!KRRS^`]A<Z-!-)J]U%>2PJ[#8I16(SC'7
M'XUY-9WU]X9UX7%G.8KJRF*[D/!P<$>X..E`'UW17+W_`,1/#6CQPKJNH"VN
M)8$F\GRG8X89&,"J]G\4O"UWIEWJ9NY+>TMI!'OFCVF5B,X1>I_*@#KR<#)J
MLS%FR:Y[PQX]TWQDUVNF6]TD=L5W23(%#9STP3Z5T2Q,PST'O3&AE9OB(X\/
M7Q_Z8FM?R21PP-0RQHZM'*BLIX96&0::>I2>IS/A?1S8Z>+JX!\^=<JI_P"6
M:>GMGJ?PJGX@AECU&TNK6)I)6)BV+U;(X'\ZZN9L"LY84N=2M589V2B0?45H
MI.]S12UN<A)X?U7["@_LZX:0G<0(SQFJ%SX:U>2W='TNY`(Z^63@UZ1XLUBX
MT71Q/:>7Y\DJQIY@)`ZDG&1V!KFM&\=Z@U_%!J:6\D,K!3)$A1D)Z'J015QG
M-JZ12G-JZ1E?#+Q'-8:K)X8U#<BN2UN)!@HXY*\]CU'N/>O5:Y+X@Z3%+HC:
MW#&J:AI1%S#,!AB%()4GN,9KH$U:S&BIJ\\Z06I@$S2.V%52,\FHJM3]]&=1
MJ7OHNT5Y=JGQXT*TN&BT_3KJ^53CS2PB5OIG)_05H>%/C#HGB74HM-FMIM/N
MICMB\Q@R.WIN'0_45B9'H-%<CXR^(-KX)N;=+_3+R:&Y4F.>':5R.JG)'/3\
MZ3P7\1M,\;7=U;65M<6\EL@?$^WY@3CC!/3C\Z`.OHK@?$OQ>T/PUKLVDS6M
MS=20`>8\&TJK'G;R1R.*ZCPWKA\1:1'J0L+BRCE)\M+C`9E[-@=C0!/KM^-+
MT"_OV./LUM))GW"DBOD[2WMO[9M)+^0I;^>C3/M)PN[)X'7BOHCXP:E_9WP\
MO$#8>[=+=?Q.3^BFO&OAGX2M?&'B1[*^,HM8H&D<Q-@YR`.?QH`]0U_XV>'K
M32Y%T0S7EXR%8@8BB(>Q);'3T%>0>$/#5[XQ\216<2LR%_,N9B.$3/))]3VK
MVB'X(>$(W#/]NE`_A:?`_05VFC:#I?A^S^R:5916L74A!RQ]2>I_&@#P3XUS
M1GQQ':1`!;.RBBP.W5OY$5+X&^$]WXMTA=2O=0:RLF8B!53<S^K8)P!D?CBN
M;\?W_P#:GCW6+A#N!NFC0^H7Y!_*OI;PSIXTOPQIMB!CR+9%(]\<_K0!E^#?
M!UOX.TX:9#.;@M(TTDK+M+9X`Q[`5KZJQE,-DKLBS$M*5.#L'49[9)`^F:MD
M8NP2WWD(`^AK/U$.FH"7:2AB"@@=\DG^E,:U)]/M;>V9A;1+$I'(7@&EG8MJ
M`B3DF+=C\:DLU*0&23Y<\\\8%83:I+-<SWMI)&H<A(FD0L"@[XR.IR?I3MJ.
MUWH:DUI<M]U!_P!]51TK]YK+KD$PA@V.QZ51E\0ZM#_RVLV^L##_`-FJSX/#
M2_:[ASN8M@MCJ3EC_.KLTG<NS2=S*^)5UM%A;9_OR$?D!_,UYY:W5Q)JEK;1
M-S+.B#(SU85T_P`3+W=XC$.>(;=5_$DG_"J/PZT&?5O$<>I/&19V3;]Y'#2?
MP@>N.OX5UTDHTKLZJ=HTKL]&\<W"VO@C5Y'/!MF0?5OE'ZFO#_'/BN>X\*Z!
MX<BD(BBM%FN<'[[9(0'Z`9_$>E>F_%C5XUT@Z2C@LR^=,!_"!PH/U//_``&O
M#/%-G-8:XUM."'2"'@^AC4_UKEM:E\SEM:G\STSX=6OA#PUX/_M[Q#-9/=76
MYDCEVR.$'`"IUR<>E<%HL+>)/B-;MIMK]G2>_P#.2)!Q$@?=VZ8%==X;^"AU
MO2K/5)-=1;>ZB60+%%EAGMDG&1TKU/PIX&T/P=&1I\6ZYD&'N)3EV'MZ#Z5B
M9#?B'X9'BGPA=V:(&NHAYUL>^]>WXC(_&OF_P]XBU+PKJ4E[ISB.X:)X3N&<
M`CKCU!P?J*^BOB!XZM?!>D;@5EU&X!%M`3_X\W^R/UZ5\T7ANIY#?W*-_I3L
M_F%<!VS\V.W4]J`/2?A=\.Y?$5X/$6NH[V8<O&LG)N'SDD^V?SKWI55%"J`J
M@8``X`KCOA7XACU_P1:<J+BR'V:91QRHX/XC!^N:[*@#AOB+X#U+QP]G%#JL
M5I:6VYC&T18LY[\'T_F:C^'7PXF\#WE]<3W\5V;F-479&5*X))Z_A7>T4`%,
MF$C0NL3!)"I",1D`XX-/HH`\6A^!&H+>QW4VO6\K"42.#"WS<Y/.:]H````Z
M"EHH`H:U!-+ISO;,4N(?WD3+UR/_`*V:XA?'VN6X"36EG*?[_P`RY_G7HU><
M>--%DTJ=M0MTW64QRX`_U3'^AK:DHR?*S:FHR=F17?BR]U)/+O0RPGK!`FU6
M_P!XDY(]N*K3:Q=7`V0Q^0G3>W4#VK"%^%^ZY7V!ICZEZL3^-=*I6V1TJFEL
MC:N=1XQNS6YX?\9Z+HVE""X-R\Q8O(8[=F`S[]^`*XM9%>'SF&!C/KQ67/?7
M-X3%:1-L/&0.OX]J;IJ:L-TU-6/1;_QM\/[Z?[5?6QGF``W/9L6('X4R3XEV
MTMJ;?PYI;QHHVK-.@CC3Z(.3^E>?6VAY8/>/N_Z9J>/Q-7;FZCLD2&*/?,^%
MA@C'+'L`*3HPV3;(=*.R=RU;V<_B7Q+:Z6\CSR7$HGO96Y/EKR<^F>`/PKH?
MBE\,I_$TT>KZ*$%]'&(Y86.T2J.A!]1T_*NB\!>%'\/V$EY?X;5+W#3G_GFO
M9!]._P#]:NLKFK23=ELCGJR3=ELCYQTK2?BEX>1K/3+;5+:(G/EIADSZC.0*
M[/P9HWCC3[V_\1Z]:W.H7R6ICL[>6X&69B,]\*.*];HK$R/G^?X=>./%7BM+
MSQ#;F-+F0>=-YBD1(/X5`/``X`KO/B-X`74O!-II^@V2F?377R(U(!*GAAD_
M@?PKT2B@#QOX7>&?&/A#Q"1>Z6PTZ]79.1(IV$<JV,_4?C7LE%%`!1110`44
M44`%%%%`!3)8HYXFBE17C<896&013Z*`/,O$_P`-+F-GN_#[!T/)M';!7_=)
MZ_0UYQ?+>:?,8+VWFMI1U65"I_6OI2H;FSM;V/R[JWBG3^[(@8?K773Q+CI)
M7.F&(<=):GSSI^N0Q1"&YR`OW7`SQ[U;D\0:?&ORN[^RI_C7L4O@3PK,Y9]#
MM,G^ZFW^53VGA'P[8.'MM%LT8=&\H$C\35.O3>MF6Z\'K8\?TVU\0^)'":-I
M;I$>#<S<(OXGC\LUZ5X1\`6?AQ_MUW+]NU-AS.XXC]D';Z]?I76@!0`H``Z`
A4M8SK.2LM$8SK.6BT04445@8A1110`4444`%%%%`'__9
`
end
</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
-----END PRIVACY-ENHANCED MESSAGE-----
