Exhibit 4.6

                      STANDBY EQUITY DISTRIBUTION AGREEMENT

      THIS STANDBY EQUITY  DISTRIBUTION  AGREEMENT (the  "Agreement") is entered
into as of October 12, 2004 between  CORNELL  CAPITAL  PARTNERS,  LP, a Delaware
limited partnership (the "Investor"), and IPOINT-MEDIA LTD., a company chartered
under the laws of the State of Israel (the "Company").

      WHEREAS,  the  parties  desire  that,  upon the terms and  subject  to the
conditions  contained herein,  the Company shall issue and sell to the Investor,
from time to time as provided  herein,  and the Investor shall purchase from the
Company  up to Ten  Million  Dollars  ($10,000,000)  of the  Company's  ordinary
shares, par value NIS 1 per share (the "Common Stock"); and

      WHEREAS,  such investments will be made in reliance upon the provisions of
Regulation D ("Regulation D") of the Securities Act of 1933, as amended, and the
regulations  promulgated  thereunder (the  "Securities  Act"),  and or upon such
other exemption from the registration  requirements of the Securities Act as may
be available with respect to any or all of the investments to be made hereunder;
and

      WHEREAS, the Company has engaged Newbridge  Securities  Corporation to act
as the Company's  exclusive  placement  agent in connection with the sale of the
Company's Common Stock to the Investor hereunder pursuant to the Placement Agent
Agreement  dated the date hereof by and among the Company,  the Placement  Agent
and the Investor (the "Placement Agent Agreement").

      NOW, THEREFORE, the parties hereto agree as follows:


                                   ARTICLE I.
                               Certain Definitions

      Section 1.1.  "Advance"  shall mean the portion of the  Commitment  Amount
requested by the Company in the Advance Notice.

      Section 1.2.  "Advance Date" shall mean the date the David Gonzalez Escrow
Account is in receipt of the funds from the Investor and David Gonzalez , as the
Investor's Counsel, is in possession of free trading shares from the Company and
therefore  an  Advance  by the  Investor  to the  Company  can be made and David
Gonzalez can release the free trading  shares to the Investor.  The Advance Date
shall be on the first Trading Day after the end of each Pricing Period.

      Section 1.3.  "Advance Notice" shall mean a written notice to the Investor
setting forth the Advance amount that the Company requests from the Investor and
the Advance Date.

      Section  1.4.  "Advance  Notice  Date"  shall  mean each date the  Company
delivers to the  Investor an Advance  Notice  requiring  the Investor to advance
funds to the Company,  subject to the terms of this Agreement. No Advance Notice
Date  shall be less than six (6)  Trading  Days after the prior  Advance  Notice
Date.


<PAGE>

      Section 1.5.  "Bid Price" shall mean,  on any date,  the closing bid price
(as reported by Bloomberg  L.P.) of the Common Stock on the Principal  Market or
if the Common Stock is not traded on a Principal  Market,  the highest  reported
bid price for the Common  Stock,  as furnished by the  National  Association  of
Securities Dealers, Inc.

      Section  1.6.  "Closing"  shall mean one of the closings of a purchase and
sale of Common Stock pursuant to Section 2.3.

      Section 1.7.  "Commitment Amount" shall mean the aggregate amount of up to
Ten Million Dollars  ($10,000,000),  which the Investor has agreed to provide to
the Company in order to purchase  the  Company's  Common  Stock  pursuant to the
terms and conditions of this Agreement.

      Section 1.8.  "Commitment  Period" shall mean the period commencing on the
earlier to occur of (i) the  Effective  Date,  or (ii) such  earlier date as the
Company and the  Investor  may  mutually  agree in writing,  and expiring on the
earliest to occur of (x) the date on which the Investor  shall have made payment
of Advances  pursuant to this  Agreement in the aggregate  amount of Ten Million
Dollars  ($10,000,000),  (y) the date this  Agreement is terminated  pursuant to
Section 2.5, or (z) the date occurring  twenty-four months (24) months after the
Effective Date.

      Section 1.9.  "Common  Stock" shall mean the Company's  common stock,  par
value $0.001 per share.

      Section  1.10.  "Condition  Satisfaction  Date" shall have the meaning set
forth in Section 7.2.

      Section 1.11.  "Damages" shall mean any loss,  claim,  damage,  liability,
costs and expenses (including,  without limitation,  reasonable  attorney's fees
and disbursements and costs and expenses of expert witnesses and investigation).

      Section 1.12.  "Effective Date" shall mean the date on which the SEC first
declares  effective  a  Registration  Statement  registering  the  resale of the
Registrable Securities as set forth in Section 7.2(b).

      Section 1.13. "Escrow Agreement" shall mean the escrow agreement among the
Company, the Investor, and David Gonzalez dated the date hereof.

      Section 1.14.  "Exchange  Act" shall mean the  Securities  Exchange Act of
1934, as amended, and the rules and regulations promulgated thereunder.

      Section  1.15.   "Material  Adverse  Effect"  shall  mean  any  condition,
circumstance, or situation that would prohibit or otherwise materially interfere
with the ability of the Company to enter into and perform any of its obligations
under this  Agreement  or the  Registration  Rights  Agreement  in any  material
respect.


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<PAGE>

      Section  1.16.  "Market  Price"  shall mean the lowest  VWAP of the Common
Stock during the Pricing Period.

      Section 1.17. "Maximum Advance Amount" shall be One Hundred Fifty Thousand
Dollars  ($150,000) per Advance  Notice up to a maximum of Six Hundred  Thousand
Dollars ($600,000) in any thirty (30) day period.

      Section  1.18 "NASD"  shall mean the National  Association  of  Securities
Dealers, Inc.

      Section  1.19  "Person"  shall  mean  an  individual,  a  corporation,   a
partnership, an association, a trust or other entity or organization,  including
a government or political subdivision or an agency or instrumentality thereof.

      Section   1.20   "Placement   Agent"  shall  mean   Newbridge   Securities
Corporation, a registered broker-dealer.

      Section 1.21 "Pricing Period" shall mean the five (5) consecutive  Trading
Days after the Advance Notice Date.

      Section 1.22 "Principal Market" shall mean the Nasdaq National Market, the
Nasdaq SmallCap Market,  the American Stock Exchange,  the OTC Bulletin Board or
the New York Stock  Exchange,  whichever  is at the time the  principal  trading
exchange or market for the Common Stock.

      Section 1.23  "Purchase  Price" shall be set at ninety eight percent (98%)
of the Market Price during the Pricing Period.

      Section  1.24  "Registrable  Securities"  shall  mean the shares of Common
Stock to be issued hereunder (i) in respect of which the Registration  Statement
has not been declared  effective by the SEC, (ii) which have not been sold under
circumstances  meeting  all of the  applicable  conditions  of Rule  144 (or any
similar  provision then in force) under the Securities Act ("Rule 144") or (iii)
which have not been otherwise  transferred to a holder who may trade such shares
without  restriction  under the Securities  Act, and the Company has delivered a
new certificate or other evidence of ownership for such securities not bearing a
restrictive legend.

      Section 1.25  "Registration  Rights Agreement" shall mean the Registration
Rights Agreement dated the date hereof, regarding the filing of the Registration
Statement for the resale of the Registrable Securities, entered into between the
Company and the Investor.

      Section 1.26 "Registration  Statement" shall mean a registration statement
on Form  S-1 or  SB-2  (if use of such  form is then  available  to the  Company
pursuant to the rules of the SEC and, if not, on such other form  promulgated by
the SEC for which the Company then  qualifies  and which counsel for the Company
shall deem appropriate,  and which form shall be available for the resale of the
Registrable  Securities  to be  registered  there under in  accordance  with the
provisions  of this  Agreement and the  Registration  Rights  Agreement,  and in
accordance with the intended method of distribution of such securities), for the
registration of the resale by the Investor of the Registrable  Securities  under
the Securities Act.


                                       3
<PAGE>

      Section  1.27  "Regulation  D" shall  have the  meaning  set  forth in the
recitals of this Agreement.

      Section 1.28 "SEC" shall mean the Securities and Exchange Commission.

      Section  1.29  "Securities  Act" shall have the  meaning  set forth in the
recitals of this Agreement.

      Section  1.30 "SEC  Documents"  shall mean Annual  Reports on Form 10-KSB,
Quarterly  Reports  on  Form  10-QSB,  Current  Reports  on Form  8-K and  Proxy
Statements  of the  Company as  supplemented  to the date  hereof,  filed by the
Company for a period of at least twelve (12) months  immediately  preceding  the
date  hereof or the  Advance  Date,  as the case may be,  until such time as the
Company  no  longer  has  an  obligation  to  maintain  the  effectiveness  of a
Registration Statement as set forth in the Registration Rights Agreement.

      Section  1.31  "Trading  Day" shall mean any day during which the New York
Stock Exchange shall be open for business.

      Section 1.32 "VWAP" shall mean the volume  weighted  average  price of the
Company's common stock as quoted by Bloomberg, LP.

                                   ARTICLE II.
                                    Advances

      Section 2.1. Investments.

            (a)  Advances.  Upon the  terms  and  conditions  set  forth  herein
(including,  without  limitation,  the provisions of Article VII hereof), on any
Advance  Notice Date the  Company may request an Advance by the  Investor by the
delivery  of an Advance  Notice.  The number of shares of Common  Stock that the
Investor  shall  receive for each Advance  shall be  determined  by dividing the
amount of the Advance by the  Purchase  Price.  No  fractional  shares  shall be
issued.  Fractional  shares  shall be rounded to the next higher whole number of
shares.  The aggregate maximum amount of all Advances that the Investor shall be
obligated to make under this Agreement shall not exceed the Commitment Amount.

      Section 2.2. Mechanics.

            (a) Advance Notice.  At any time during the Commitment  Period,  the
Company may deliver an Advance Notice to the Investor, subject to the conditions
set forth in Section  7.2;  provided,  however,  the amount for each  Advance as
designated  by the Company in the  applicable  Advance  Notice shall not be more
than the Maximum Advance Amount.  The aggregate amount of the Advances  pursuant
to  this  Agreement  shall  not  exceed  the  Commitment   Amount.  The  Company
acknowledges  that the  Investor may sell shares of the  Company's  Common Stock
corresponding  with a particular Advance Notice on the day the Advance Notice is
received  by the  Investor.  There  will be a minimum  of six (6)  Trading  Days
between each Advance Notice Date.


                                       4
<PAGE>

            (b) Date of Delivery of Advance  Notice.  An Advance Notice shall be
deemed delivered on (i) the Trading Day it is received by facsimile or otherwise
by the Investor if such notice is received  prior to 12:00 noon Eastern Time, or
(ii) the  immediately  succeeding  Trading Day if it is received by facsimile or
otherwise after 12:00 noon Eastern Time on a Trading Day or at any time on a day
which is not a Trading Day. No Advance  Notice may be deemed  delivered on a day
that is not a Trading Day.

            (c) Pre-Closing Share Credit. Within two (2) business days after the
Advance  Notice Date,  the Company shall credit  shares of the Company's  Common
Stock to the  Investor's  balance  account  with The  Depository  Trust  Company
through its Deposit  Withdrawal At Custodian  system,  in an amount equal to the
amount  of the  requested  Advance  divided  by the  closing  Bid  Price  of the
Company's Common Stock as of the Advance Notice Date multiplied by one point one
(1.1).  Any  adjustments to the number of shares to be delivered to the Investor
at the  Closing  as a result of  fluctuations  in the  closing  Bid Price of the
Company's  Common Stock shall be made as of the date of the Closing.  Any excess
shares  shall be credited to the next  Advance.  In no event shall the number of
shares issuable to the Investor pursuant to an Advance cause the Investor to own
in excess of nine and 9/10 percent (9.9%) of the then  outstanding  Common Stock
of the Company.

            (d) Hardship.  In the event the Investor sells the Company's  Common
Stock  pursuant to  subsection  (c) above and the  Company  fails to perform its
obligations  as mandated in Section 2.5 and 2.2 (c), and  specifically  fails to
provide the Investor with the shares of Common Stock for the applicable Advance,
the Company  acknowledges that the Investor shall suffer financial  hardship and
therefore  shall  be  liable  for any  and all  losses,  commissions,  fees,  or
financial hardship caused to the Investor.

      Section  2.3.  Closings.  On each  Advance  Date,  which  shall be one (1)
Trading Day after the  expiration of the Pricing  Period,  (i) the Company shall
deliver to the Investor's  Counsel, as defined pursuant to the Escrow Agreement,
shares of the Company's Common Stock,  representing the amount of the Advance by
the  Investor  pursuant  to Section 2.1  herein,  registered  in the name of the
Investor  which shall be delivered to the  Investor,  or otherwise in accordance
with the Escrow  Agreement and (ii) the Investor shall deliver to David Gonzalez
(the "Escrow  Agent") the amount of the Advance  specified in the Advance Notice
by wire transfer of immediately  available funds which shall be delivered to the
Company, or otherwise in accordance with the Escrow Agreement.  In addition,  on
or prior to the Advance Date, each of the Company and the Investor shall deliver
to the other  through the  Investor's  Counsel all  documents,  instruments  and
writings  required to be delivered by either of them pursuant to this  Agreement
in order to implement and effect the transactions  contemplated herein.  Payment
of funds to the  Company  and  delivery  of the  Company's  Common  Stock to the
Investor shall occur in accordance with the conditions set forth above and those
contained in the Escrow  Agreement;  provided,  however,  that to the extent the
Company has not paid the fees, expenses,  and disbursements of the Investor, the
Investor's  counsel in accordance  with Section  12.4,  the amount of such fees,
expenses,  and  disbursements may be deducted by the Investor (and shall be paid
to the  relevant  party) from the amount of the Advance with no reduction in the
amount of shares of the  Company's  Common Stock to be delivered on such Advance
Date.


                                       5
<PAGE>

      Section 2.4. Termination of Investment.  The obligation of the Investor to
make an  Advance to the  Company  pursuant  to this  Agreement  shall  terminate
permanently  (including  with  respect  to an  Advance  Date  that  has  not yet
occurred)  in the event that (i) there shall occur any stop order or  suspension
of the  effectiveness  of the  Registration  Statement for an aggregate of fifty
(50)  Trading  Days,  other  than due to the acts of the  Investor,  during  the
Commitment  Period,  and (ii) the Company  shall at any time fail  materially to
comply with the  requirements of Article VI and such failure is not cured within
thirty (30) days after receipt of written  notice from the  Investor,  provided,
however,  that  this  termination  provision  shall  not  apply  to  any  period
commencing upon the filing of a  post-effective  amendment to such  Registration
Statement  and ending upon the date on which such post  effective  amendment  is
declared effective by the SEC.

      Section 2.5. Agreement to Advance Funds.

            (a) The  Investor  agrees to  advance  the amount  specified  in the
Advance  Notice to the Company  after the  completion  of each of the  following
conditions and the other conditions set forth in this Agreement:

                  (i)  the  execution  and  delivery  by the  Company,  and  the
Investor, of this Agreement, and the Exhibits hereto;

                  (ii) the Company's Common Stock shall have been authorized for
quotation on the Principal Market.

                  (iii)  Investor's  Counsel  shall have  received the shares of
Common Stock applicable to the Advance in accordance with Section 2.2(c) hereof;

                  (iv) the Company's  Registration Statement with respect to the
resale  of the  Registrable  Securities  in  accordance  with  the  terms of the
Registration Rights Agreement shall have been declared effective by the SEC;

                  (v) the Company shall have  obtained all material  permits and
qualifications  required by any  applicable  state for the offer and sale of the
Registrable Securities,  or shall have the availability of exemptions therefrom.
The sale and issuance of the Registrable  Securities shall be legally  permitted
by all laws and regulations to which the Company is subject;

                  (vi) the  Company  shall have filed with the  Commission  in a
timely manner all reports,  notices and other documents required of a "reporting
company" under the Exchange Act and applicable Commission regulations;

                  (vii) the fees as set forth in Section  12.4 below  shall have
been paid or can be withheld as provided in Section 2.3;

                  (viii) the conditions set forth in Section 7.2 shall have been
satisfied;

                  (ix) The  Company  shall  have  provided  to the  Investor  an
acknowledgement,  from Kost, Forer, Gabbay & Kasierer, a member of Ersnt & Young
Global,  as to its ability to provide all  consents  required in order to file a
registration statement in connection with this transaction; and


                                       6
<PAGE>

                  (x) The Company's transfer agent shall be DWAC eligible.

      Section 2.6. Lock Up Period.

                  (i) During the Commitment  Period, the Company shall not issue
or sell, without the prior written consent of the Investor, (i) any Common Stock
or Preferred Stock without  consideration or for a consideration  per share less
than the Bid Price on the date of  issuance  or (ii) issue or sell any  warrant,
option,  right,  contract,  call, or other  security or instrument  granting the
holder thereof the right to acquire Common Stock without  consideration or for a
consideration  per  share  less  than the Bid  Price  on the  date of  issuance;
hereunder  after the one year  anniversary  hereof,  upon a minimum  of 10 days'
prior  written  notice,  the Company  may at its  discretion  grant  warrants or
options  to its  employees  in an  amount  not to  exceed  10% of the  Company's
outstanding Common Stock.

                  (ii) On the date  hereof,  the Company  shall obtain from each
officer and director a lock-up agreement,  as defined below, in the form annexed
hereto as  Schedule  2.6  agreeing  to only sell in  compliance  with the volume
limitation of Rule 144.

                                  ARTICLE III.
                   Representations and Warranties of Investor

      Investor  hereby  represents and warrants to, and agrees with, the Company
that the  following  are true and as of the date  hereof and as of each  Advance
Date:

      Section  3.1.  Organization  and  Authorization.   The  Investor  is  duly
incorporated  or  organized  and  validly  existing in the  jurisdiction  of its
incorporation  or  organization  and has all  requisite  power and  authority to
purchase and hold the securities issuable hereunder.  The decision to invest and
the execution and delivery of this Agreement by such Investor,  the  performance
by such  Investor of its  obligations  hereunder  and the  consummation  by such
Investor of the transactions  contemplated  hereby have been duly authorized and
requires no other  proceedings on the part of the Investor.  The undersigned has
the right,  power and  authority to execute and deliver this  Agreement  and all
other  instruments  (including,  without  limitations,  the Registration  Rights
Agreement), on behalf of the Investor. This Agreement has been duly executed and
delivered by the Investor and,  assuming the  execution and delivery  hereof and
acceptance thereof by the Company,  will constitute the legal, valid and binding
obligations of the Investor, enforceable against the Investor in accordance with
its terms.

      Section 3.2.  Evaluation  of Risks.  The Investor has such  knowledge  and
experience in financial tax and business  matters as to be capable of evaluating
the  merits  and risks of,  and  bearing  the  economic  risks  entailed  by, an
investment  in the Company and of protecting  its  interests in connection  with
this  transaction.  It recognizes that its investment in the Company  involves a
high degree of risk.

      Section 3.3. No Legal Advice From the Company.  The Investor  acknowledges
that it had the  opportunity  to  review  this  Agreement  and the  transactions
contemplated  by this Agreement with his or its own legal counsel and investment
and tax  advisors.  The Investor is relying  solely on such counsel and advisors
and  not on any  statements  or  representations  of the  Company  or any of its
representatives  or agents for legal,  tax or investment  advice with respect to
this  investment,  the  transactions  contemplated  by  this  Agreement  or  the
securities laws of any jurisdiction.


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<PAGE>

      Section 3.4. Investment Purpose. The securities are being purchased by the
Investor  for its own  account,  for  investment  and  without  any  view to the
distribution, assignment or resale to others or fractionalization in whole or in
part.  The Investor  agrees not to assign or in any way transfer the  Investor's
rights to the  securities  or any  interest  therein and  acknowledges  that the
Company  will not  recognize  any  purported  assignment  or transfer  except in
accordance with applicable  Federal and state  securities  laws. No other person
has or will have a direct or indirect beneficial interest in the securities. The
Investor  agrees not to sell,  hypothecate or otherwise  transfer the Investor's
securities  unless the securities  are  registered  under Federal and applicable
state securities laws or unless,  in the opinion of counsel  satisfactory to the
Company, an exemption from such laws is available.

      Section 3.5. Accredited Investor. The Investor is an "Accredited Investor"
as that term is defined in Rule 501(a)(3) of Regulation D of the Securities Act.

      Section 3.6. Information. The Investor and its advisors (and its counsel),
if any,  have  been  furnished  with all  materials  relating  to the  business,
finances and  operations of the Company and  information  it deemed  material to
making an informed investment decision.  The Investor and its advisors,  if any,
have been  afforded  the  opportunity  to ask  questions  of the Company and its
management.  Neither such  inquiries nor any other due diligence  investigations
conducted by such Investor or its advisors, if any, or its representatives shall
modify,  amend  or  affect  the  Investor's  right  to  rely  on  the  Company's
representations  and  warranties  contained  in  this  Agreement.  The  Investor
understands that its investment  involves a high degree of risk. The Investor is
in a position  regarding  the  Company,  which,  based upon  employment,  family
relationship or economic bargaining power,  enabled and enables such Investor to
obtain information from the Company in order to evaluate the merits and risks of
this investment. The Investor has sought such accounting,  legal and tax advice,
as it has  considered  necessary to make an informed  investment  decision  with
respect to this transaction.

      Section  3.7.  Receipt of  Documents.  The  Investor  and its  counsel has
received and read in their entirety: (i) this Agreement and the Exhibits annexed
hereto;  (ii) all due  diligence and other  information  necessary to verify the
accuracy and completeness of such representations, warranties and covenants; and
(iii) answers to all questions the Investor  submitted to the Company  regarding
an  investment  in the Company;  and the Investor has relied on the  information
contained  therein and has not been furnished any other  documents,  literature,
memorandum or prospectus.

      Section 3.8.  Registration  Rights  Agreement  and Escrow  Agreement.  The
parties have  entered  into the  Registration  Rights  Agreement  and the Escrow
Agreement, each dated the date hereof.

      Section 3.9. No General Solicitation.  Neither the Company, nor any of its
affiliates,  nor any person  acting on its or their  behalf,  has engaged in any
form of general  solicitation  or general  advertising  (within  the  meaning of
Regulation D under the Securities  Act) in connection  with the offer or sale of
the shares of Common Stock offered hereby.


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<PAGE>

      Section 3.10. Not an Affiliate.  The Investor is not an officer,  director
or a person that  directly,  or indirectly  through one or more  intermediaries,
controls or is controlled by, or is under common control with the Company or any
"Affiliate"  of the  Company  (as  that  term  is  defined  in  Rule  405 of the
Securities  Act).  Neither the  Investor  nor its  Affiliates  has an open short
position in the Common  Stock of the Company,  and the  Investor  agrees that it
will not,  and that it will  cause its  Affiliates  not to,  engage in any short
sales of or hedging transactions with respect to the Common Stock, provided that
the Company  acknowledges  and agrees that upon receipt of an Advance Notice the
Investor  will sell the  Shares to be issued  to the  Investor  pursuant  to the
Advance Notice, even if the Shares have not been delivered to the Investor.

      Section 3.11. Trading  Activities.  The Investor's trading activities with
respect to the Company's Common Stock shall be in compliance with all applicable
federal  and state  securities  laws,  rules and  regulations  and the rules and
regulations  of the  Principal  Market on which the  Company's  Common  Stock is
listed or traded.  Neither the  Investor  nor its  affiliates  has an open short
position in the Common Stock of the Company and, except as set forth below,  the
Investor shall not and will cause its affiliates not to engage in any short sale
as defined in any applicable SEC or National  Association of Securities  Dealers
rules on any hedging  transactions  with  respect to the Common  Stock.  Without
limiting the  foregoing,  the  Investor  agrees not to engage in any naked short
transactions  in excess of the  amount of shares  owned (or an  offsetting  long
position) during the Commitment  Period.  The Investor shall be entitled to sell
Common Stock during the applicable Pricing Period.

      Section 3.12. No Buyer makes any  representation or warranty regarding the
Company's  ability  to  successfully  become  a  public  company  or to have any
registration  statement filed by the Company pursuant to the Registration Rights
Agreement or otherwise  declared  effective by the SEC. The Company has the sole
obligation  to make any and all such  filings  as may be  necessary  to become a
public company and to have any registration  statement declared effective by the
SEC.

      Section 3.13.  The Company  acknowledges  that the Buyer is relying on the
representations  and  warranties  made by the  Company  hereunder  and that such
representations and warranties are a material inducement to the Buyer purchasing
the Convertible  Debentures.  The Company further acknowledges that without such
representations  and warranties of the Company made  hereunder,  the Buyer would
not enter into this Agreement.

                                   ARTICLE IV.
                  Representations and Warranties of the Company

      Except as stated  below or on the  Disclosure  Schedule  (the  "Disclosure
Schedule")  attached  hereto as Exhibit "B," the Company  hereby  represents and
warrants to, and  covenants  with,  the Investor that the following are true and
correct as of the date hereof:

      Section  4.1.   Organization  and  Qualification.   The  Company  is  duly
incorporated  or  organized  and  validly  existing in the  jurisdiction  of its
incorporation  or  organization  and  has  all  requisite  power  and  authority
corporate  power to own its properties and to carry on its business as now being
conducted.  Each of the  Company and its  subsidiaries  is duly  qualified  as a
foreign corporation to do business and is in good standing in every jurisdiction
in which the nature of the  business  conducted  by it makes such  qualification
necessary,  except to the extent  that the failure to be so  qualified  or be in
good standing  would not have a Material  Adverse  Effect on the Company and its
subsidiaries taken as a whole.


                                       9
<PAGE>

      Section   4.2.   Authorization,   Enforcement,   Compliance   with   Other
Instruments.  (i) The Company has the requisite corporate power and authority to
enter into and perform this Agreement,  the Registration  Rights Agreement,  the
Escrow Agreement,  the Placement Agent Agreement and any related agreements,  in
accordance with the terms hereof and thereof, (ii) the execution and delivery of
this Agreement,  the Registration  Rights Agreement,  the Escrow Agreement,  the
Placement  Agent  Agreement  and any related  agreements  by the Company and the
consummation by it of the  transactions  contemplated  hereby and thereby,  have
been duly  authorized by the Company's Board of Directors and no further consent
or  authorization  is required by the  Company,  its Board of  Directors  or its
stockholders,  (iii) this Agreement,  the  Registration  Rights  Agreement,  the
Escrow Agreement,  the Placement Agent Agreement and any related agreements have
been duly executed and delivered by the Company,  and (iv) this  Agreement,  the
Registration  Rights  Agreement,  the  Escrow  Agreement,  the  Placement  Agent
Agreement and assuming the execution and delivery  thereof and acceptance by the
Investor and any related agreements constitute the valid and binding obligations
of the Company  enforceable  against the Company in accordance with their terms,
except as such  enforceability may be limited by general principles of equity or
applicable bankruptcy,  insolvency,  reorganization,  moratorium, liquidation or
similar laws relating to, or affecting generally,  the enforcement of creditors'
rights and remedies.

      Section 4.3. Capitalization. As of the date hereof, the authorized capital
stock of the Company  consists of 20,000,000  shares of Common Stock,  par value
NIS 1 per  share,  of which  297,000  shares of Common  Stock  were  issued  and
outstanding  (excluding  the  issuance  of  the  Buyer's  Stock).  All  of  such
outstanding   shares   have  been   validly   issued  and  are  fully  paid  and
nonassessable.  Except as disclosed  in the  Disclosure  Schedule,  no shares of
Common Stock are subject to preemptive rights or any other similar rights or any
liens or encumbrances suffered or permitted by the Company.  Except as disclosed
in the Disclosure Schedule,  as of the date hereof, (i) there are no outstanding
options,  warrants,  scrip,  rights to subscribe to, calls or commitments of any
character  whatsoever relating to, or securities or rights convertible into, any
shares of capital stock of the Company or any of its subsidiaries, or contracts,
commitments,  understandings  or arrangements by which the Company or any of its
subsidiaries is or may become bound to issue additional  shares of capital stock
of the Company or any of its subsidiaries or options, warrants, scrip, rights to
subscribe to, calls or commitments of any character  whatsoever  relating to, or
securities  or rights  convertible  into,  any  shares of  capital  stock of the
Company  or  any  of its  subsidiaries,  (ii)  there  are  no  outstanding  debt
securities (iii) there are no outstanding registration statements and (iv) there
are  no  agreements  or  arrangements  under  which  the  Company  or any of its
subsidiaries is obligated to register the sale of any of their  securities under
the Securities Act (except pursuant to the Registration Rights Agreement). There
are no securities or instruments containing  anti-dilution or similar provisions
that  will be  triggered  by this  Agreement  or any  related  agreement  or the
consummation of the transactions  described  herein or therein.  The Company has
furnished to the Investor true and correct  copies of the Company's  Certificate
of  Incorporation,  as  amended  and  as in  effect  on  the  date  hereof  (the
"Certificate of Incorporation"),  and the Company's By-laws, as in effect on the
date hereof (the "By-laws"), and the terms of all securities convertible into or
exercisable  for Common Stock and the material  rights of the holders thereof in
respect thereto.


                                       10
<PAGE>

      Section 4.4. No Conflict. The execution,  delivery and performance of this
Agreement by the Company and the consummation by the Company of the transactions
contemplated  hereby will not (i) result in a violation  of the  Certificate  of
Incorporation  or any certificate of  designations of any outstanding  series of
preferred  stock of the Company or By-laws or (ii) conflict with or constitute a
default (or an event  which with notice or lapse of time or both would  become a
default)  under,  or  give to  others  any  rights  of  termination,  amendment,
acceleration or cancellation of, any agreement, indenture or instrument to which
the Company or any of its  subsidiaries  is a party, or result in a violation of
any law, rule,  regulation,  order,  judgment or decree  (including  federal and
state  securities  laws and  regulations  and the rules and  regulations  of the
Principal Market on which the Common Stock is quoted)  applicable to the Company
or any of its  subsidiaries  or by which any  material  property or asset of the
Company or any of its  subsidiaries is bound or affected and which would cause a
Material Adverse Effect. Except as disclosed in the Disclosure Schedule, neither
the Company nor its  subsidiaries  is in  violation of any term of or in default
under its  Certificate  of  Incorporation  or  By-laws  or their  organizational
charter or by-laws, respectively, or any material contract, agreement, mortgage,
indebtedness,  indenture,  instrument, judgment, decree or order or any statute,
rule or regulation  applicable to the Company or its subsidiaries.  The business
of the Company and its  subsidiaries  is not being conducted in violation of any
material  law,  ordinance,  regulation  of any  governmental  entity.  Except as
specifically contemplated by this Agreement and as required under the Securities
Act and any  applicable  state  securities  laws, the Company is not required to
obtain  any  consent,   authorization  or  order  of,  or  make  any  filing  or
registration with, any court or governmental  agency in order for it to execute,
deliver  or  perform  any of its  obligations  under  or  contemplated  by  this
Agreement or the  Registration  Rights  Agreement in  accordance  with the terms
hereof  or  thereof.   All  consents,   authorizations,   orders,   filings  and
registrations  which the Company is required to obtain pursuant to the preceding
sentence  have been  obtained or effected  on or prior to the date  hereof.  The
Company and its subsidiaries are unaware of any fact or circumstance which might
give rise to any of the foregoing.

      Section 4.5.  Financial  Statements.  As of their  respective  dates,  the
financial  statements of the Company (the  "Financial  Statements")  for the two
most recently  completed fiscal years and any subsequent interim period complied
as to form in all material respects with applicable accounting  requirements and
the  published  rules and  regulations  of the SEC with  respect  thereto.  Such
financial  statements have been prepared in accordance  with generally  accepted
accounting principles, consistently applied, during the periods involved (except
(i) as may be otherwise  indicated  in such  financial  statements  or the notes
thereto, or (ii) in the case of unaudited interim statements, to the extent they
may exclude  footnotes or may be condensed or summary  statements)  and,  fairly
present in all material respects the financial position of the Company as of the
dates thereof and the results of its  operations  and cash flows for the periods
then ended  (subject,  in the case of unaudited  statements,  to normal year-end
audit adjustments). No other information provided by or on behalf of the Company
to the  Investor  contains any untrue  statement of a material  fact or omits to
state any material fact  necessary in order to make the statements  therein,  in
the light of the circumstances under which they were made, not misleading.


                                       11
<PAGE>

      Section 4.6. No Default.  Except as disclosed in the Disclosure  Schedule,
the Company is not in default in the  performance  or observance of any material
obligation,  agreement,  covenant  or  condition  contained  in  any  indenture,
mortgage, deed of trust or other material instrument or agreement to which it is
a party or by which it is or its  property is bound and  neither the  execution,
nor the  delivery  by the  Company,  nor the  performance  by the Company of its
obligations  under this Agreement or any of the exhibits or  attachments  hereto
will  conflict  with or result in the breach or violation of any of the terms or
provisions  of, or  constitute a default or result in the creation or imposition
of any lien or  charge on any  assets or  properties  of the  Company  under its
Certificate of Incorporation, By-Laws, any material indenture, mortgage, deed of
trust or other  material  agreement  applicable  to the Company or instrument to
which the  Company is a party or by which it is bound,  or any  statute,  or any
decree, judgment, order, rules or regulation of any court or governmental agency
or body having  jurisdiction  over the Company or its  properties,  in each case
which  default,  lien or charge is likely to cause a Material  Adverse Effect on
the Company's business or financial condition.

      Section 4.7. Absence of Events of Default. Except for matters described in
the Disclosure  Schedule and/or this Agreement,  no Event of Default, as defined
in the respective agreement to which the Company is a party, and no event which,
with the giving of notice or the passage of time or both,  would become an Event
of Default (as so defined),  has occurred and is continuing,  which would have a
Material  Adverse  Effect  on the  Company's  business,  properties,  prospects,
financial condition or results of operations.

      Section  4.8.   Intellectual   Property   Rights.   The  Company  and  its
subsidiaries  own or possess  adequate  rights or licenses  to use all  material
trademarks,  trade names,  service marks,  service mark  registrations,  service
names, patents,  patent rights,  copyrights,  inventions,  licenses,  approvals,
governmental authorizations, trade secrets and rights necessary to conduct their
respective businesses as now conducted.  The Company and its subsidiaries do not
have any knowledge of any  infringement  by the Company or its  subsidiaries  of
trademark,  trade name rights, patents, patent rights,  copyrights,  inventions,
licenses, service names, service marks, service mark registrations, trade secret
or other similar rights of others,  and, to the knowledge of the Company,  there
is no claim,  action or  proceeding  being  made or brought  against,  or to the
Company's  knowledge,  being threatened against, the Company or its subsidiaries
regarding trademark,  trade name, patents, patent rights, invention,  copyright,
license, service names, service marks, service mark registrations,  trade secret
or other  infringement;  and the Company and its subsidiaries are unaware of any
facts or circumstances which might give rise to any of the foregoing.

      Section  4.9.  Employee  Relations.  Neither  the  Company  nor any of its
subsidiaries  is involved in any labor  dispute  nor,  to the  knowledge  of the
Company or any of its subsidiaries,  is any such dispute threatened. None of the
Company's or its subsidiaries'  employees is a member of a union and the Company
and its subsidiaries believe that their relations with their employees are good.

      Section 4.10. Environmental Laws. The Company and its subsidiaries are (i)
in compliance with any and all applicable material foreign,  federal,  state and
local  laws and  regulations  relating  to the  protection  of human  health and
safety,  the environment or hazardous or toxic substances or wastes,  pollutants
or contaminants ("Environmental Laws"), (ii) have received all permits, licenses
or other  approvals  required  of them under  applicable  Environmental  Laws to
conduct their  respective  businesses and (iii) are in compliance with all terms
and conditions of any such permit, license or approval.


                                       12
<PAGE>

      Section 4.11. Title. Except as set forth in the Disclosure  Schedule,  the
Company has good and  marketable  title to its  properties  and material  assets
owned by it, free and clear of any pledge, lien, security interest, encumbrance,
claim or equitable  interest other than such as are not material to the business
of the Company. Any real property and facilities held under lease by the Company
and its  subsidiaries  are held by them under valid,  subsisting and enforceable
leases with such  exceptions as are not material and do not  interfere  with the
use made and proposed to be made of such  property and  buildings by the Company
and its subsidiaries.

      Section  4.12.  Insurance.  The Company and each of its  subsidiaries  are
insured by insurers of recognized financial  responsibility  against such losses
and risks and in such  amounts  as  management  of the  Company  believes  to be
prudent  and  customary  in  the   businesses  in  which  the  Company  and  its
subsidiaries  are engaged.  Neither the Company nor any such subsidiary has been
refused any insurance coverage sought or applied for and neither the Company nor
any such  subsidiary has any reason to believe that it will not be able to renew
its existing  insurance  coverage as and when such coverage expires or to obtain
similar  coverage  from  similar  insurers as may be  necessary  to continue its
business at a cost that would not materially and adversely affect the condition,
financial or otherwise,  or the earnings,  business or operations of the Company
and its subsidiaries, taken as a whole.

      Section 4.13. Regulatory Permits. The Company and its subsidiaries possess
all material certificates,  authorizations and permits issued by the appropriate
federal,  state or foreign  regulatory  authorities  necessary to conduct  their
respective  businesses,  and neither the  Company  nor any such  subsidiary  has
received any notice of proceedings relating to the revocation or modification of
any such certificate, authorization or permit.

      Section 4.14.  Internal Accounting  Controls.  The Company and each of its
subsidiaries  maintain a system of internal  accounting  controls  sufficient to
provide  reasonable  assurance that (i)  transactions are executed in accordance
with  management's  general or specific  authorizations,  (ii)  transactions are
recorded  as  necessary  to  permit  preparation  of  financial   statements  in
conformity with generally accepted  accounting  principles and to maintain asset
accountability,  (iii) access to assets is  permitted  only in  accordance  with
management's   general  or  specific   authorization   and  (iv)  the   recorded
accountability  for assets is compared  with the existing  assets at  reasonable
intervals and appropriate action is taken with respect to any differences.

      Section 4.15. No Material  Adverse  Breaches,  etc. Except as set forth in
the  Disclosure  Schedule,  neither the Company nor any of its  subsidiaries  is
subject to any charter,  corporate or other legal restriction,  or any judgment,
decree,  order,  rule or  regulation  which  in the  judgment  of the  Company's
officers has or is expected in the future to have a Material  Adverse  Effect on
the business, properties, operations, financial condition, results of operations
or  prospects  of the  Company or its  subsidiaries.  Except as set forth in the
Disclosure  Schedule,  neither  the Company  nor any of its  subsidiaries  is in
breach of any  contract  or  agreement  which  breach,  in the  judgment  of the
Company's officers,  has or is expected to have a Material Adverse Effect on the
business, properties,  operations, financial condition, results of operations or
prospects of the Company or its subsidiaries.


                                       13
<PAGE>

      Section 4.16. Absence of Litigation. Except as set forth in the Disclosure
Schedule, there is no action, suit, proceeding,  inquiry or investigation before
or by any court, public board, government agency,  self-regulatory  organization
or body pending against or affecting the Company, the Common Stock or any of the
Company's subsidiaries, wherein an unfavorable decision, ruling or finding would
(i) have a Material Adverse Effect on the transactions  contemplated hereby (ii)
adversely affect the validity or enforceability  of, or the authority or ability
of the Company to perform its  obligations  under,  this Agreement or any of the
documents  contemplated  herein,  or (iii) except as expressly  disclosed in the
Disclosure Schedule, have a Material Adverse Effect on the business, operations,
properties,  financial  condition or results of operation of the Company and its
subsidiaries taken as a whole.

      Section  4.17.  Subsidiaries.   Except  as  disclosed  in  the  Disclosure
Schedule, the Company does not presently own or control, directly or indirectly,
any  interest  in any  other  corporation,  partnership,  association  or  other
business entity.

      Section 4.18. Tax Status.  Except as disclosed in the Disclosure Schedule,
the Company and each of its subsidiaries has made or filed all federal and state
income and all other tax  returns,  reports  and  declarations  required  by any
jurisdiction  to which it is subject and (unless and only to the extent that the
Company  and each of its  subsidiaries  has set  aside on its  books  provisions
reasonably adequate for the payment of all unpaid and unreported taxes) has paid
all taxes and other  governmental  assessments  and charges that are material in
amount, shown or determined to be due on such returns, reports and declarations,
except  those  being  contested  in good  faith  and has set  aside on its books
provision  reasonably  adequate  for  the  payment  of  all  taxes  for  periods
subsequent to the periods to which such returns,  reports or declarations apply.
There are no unpaid taxes in any material amount claimed to be due by the taxing
authority of any jurisdiction,  and the officers of the Company know of no basis
for any such claim.

      Section 4.19. Certain Transactions.  Except as set forth in the Disclosure
Schedule,  none of the  officers,  directors,  or  employees  of the  Company is
presently a party to any  transaction  with the Company (other than for services
as employees,  officers and  directors),  including  any contract,  agreement or
other  arrangement  providing for the furnishing of services to or by, providing
for rental of real or  personal  property  to or from,  or  otherwise  requiring
payments to or from any officer,  director or such employee or, to the knowledge
of the Company, any corporation, partnership, trust or other entity in which any
officer,  director,  or any such  employee has a  substantial  interest or is an
officer, director, trustee or partner.

      Section  4.20.  Fees and  Rights  of First  Refusal.  The  Company  is not
obligated to offer the securities  offered hereunder on a right of first refusal
basis or otherwise to any third parties  including,  but not limited to, current
or former shareholders of the Company,  underwriters,  brokers,  agents or other
third parties.

      Section  4.21.  Use of  Proceeds.  The  Company  represents  that  the net
proceeds  from  this  offering  will be used  for  general  corporate  purposes.
However,  in no event shall the net proceeds  from this  offering be used by the
Company for the  payment  (or loaned to any such person for the  payment) of any
judgment,  or other  liability,  incurred  by any  executive  officer,  officer,
director or  employee  of the  Company,  except for any  liability  owed to such
person for services rendered,  or if any judgment or other liability is incurred
by such person originating from services rendered to the Company, or the Company
has indemnified such person from liability.


                                       14
<PAGE>

      Section 4.22. Further Representation and Warranties of the Company. For so
long  as  any  securities   issuable  hereunder  held  by  the  Investor  remain
outstanding, the Company acknowledges,  represents,  warrants and agrees that it
will maintain the listing of its Common Stock on the Principal Market

      Section 4.23. Opinion of Counsel. Investor shall receive an opinion letter
from counsel acceptable to the Investor on the date hereof.

      Section  4.24.  Opinion  of  Counsel.  The  Company  will  obtain  for the
Investor, at the Company's expense, any and all opinions of counsel which may be
reasonably  required in order to sell the securities  issuable hereunder without
restriction.

      Section  4.25.  Dilution.  The  Company  is aware  and  acknowledges  that
issuance  of shares of the  Company's  Common  Stock  could  cause  dilution  to
existing shareholders and could significantly increase the outstanding number of
shares of Common Stock.

                                   ARTICLE V.
                                 Indemnification

      Section 5.1. Indemnification.

            (a) In  consideration  of the  Investor's  execution and delivery of
this Agreement,  and in addition to all of the Company's other obligations under
this Agreement,  the Company shall defend, protect,  indemnify and hold harmless
the Investor, and all of its officers, directors, partners, attorneys, employees
and agents (including, without limitation, those retained in connection with the
transactions  contemplated  by  this  Agreement)  (collectively,  the  "Investor
Indemnitees")  from and against any and all  actions,  causes of action,  suits,
claims, losses, costs, penalties, fees, liabilities and damages, and expenses in
connection therewith  (irrespective of whether any such Investor Indemnitee is a
party  to the  action  for  which  indemnification  hereunder  is  sought),  and
including  reasonable   attorneys'  fees  and  disbursements  (the  "Indemnified
Liabilities"),  incurred by the Investor  Indemnitees or any of them as a result
of, or arising out of, or relating to (a) any misrepresentation or breach of any
representation  or  warranty  made  by the  Company  in  this  Agreement  or the
Registration  Rights Agreement or any other certificate,  instrument or document
contemplated  hereby or thereby,  (b) any breach of any  covenant,  agreement or
obligation of the Company contained in this Agreement or the Registration Rights
Agreement or any other certificate,  instrument or document  contemplated hereby
or thereby,  or (c) any cause of action,  suit or claim  brought or made against
such  Investor  Indemnitee  arising  out of or  resulting  from  the  execution,
delivery,  performance or enforcement of this Agreement or any other instrument,
document  or  agreement   executed  pursuant  hereto  by  any  of  the  Investor
Indemnitees.  To the extent that the foregoing undertaking by the Company may be
unenforceable for any reason, the Company shall make the maximum contribution to
the payment and  satisfaction of each of the Indemnified  Liabilities,  which is
permissible under applicable law.


                                       15
<PAGE>

            (b) In consideration of the Company's execution and delivery of this
Agreement, and in addition to all of the Investor's other obligations under this
Agreement,  the Investor shall defend, protect,  indemnify and hold harmless the
Company and all of its officers, directors,  shareholders,  attorneys, employees
and agents (including, without limitation, those retained in connection with the
transactions  contemplated  by  this  Agreement)  (collectively,   the  "Company
Indemnitees") from and against any and all Indemnified  Liabilities  incurred by
the  Company  Indemnitees  or any of them as a result of, or arising  out of, or
relating  to (a)  any  misrepresentation  or  breach  of any  representation  or
warranty  made  by the  Investor  in this  Agreement,  the  Registration  Rights
Agreement, or any instrument or document contemplated hereby or thereby executed
by the Investor, (b) any breach of any covenant,  agreement or obligation of the
Investor(s)  contained in this Agreement,  the Registration  Rights Agreement or
any other  certificate,  instrument or document  contemplated  hereby or thereby
executed by the Investor,  or (c) any cause of action,  suit or claim brought or
made against such Company  Indemnitee  based on  misrepresentations  or due to a
breach by the  Investor  and arising  out of or  resulting  from the  execution,
delivery,  performance or enforcement of this Agreement or any other instrument,
document  or  agreement   executed   pursuant  hereto  by  any  of  the  Company
Indemnitees. To the extent that the foregoing undertaking by the Investor may be
unenforceable for any reason,  the Investor shall make the maximum  contribution
to the payment and satisfaction of each of the Indemnified Liabilities, which is
permissible under applicable law.

            (c) The obligations of the parties to indemnify or make contribution
under this Section 5.1 shall survive termination.

                                   ARTICLE VI.
                            Covenants of the Company

      Section 6.1. Registration Rights. The Company shall cause the Registration
Rights Agreement to remain in full force and effect and the Company shall comply
in all material respects with the terms thereof.

      Section  6.2.  Listing  of Common  Stock.  The  Company  shall  obtain and
maintain  the  Common  Stock's  authorization  for  quotation  on  the  National
Association  of  Securities  Dealers  Inc.'s  Over the  Counter  Bulletin  Board
("OTCBB").

      Section 6.3. Exchange Act Registration.  The Company will cause its Common
Stock to be  registered  under Section 12(g) of the Exchange Act, will file in a
timely  manner all  reports  and other  documents  required of it as a reporting
company under the Exchange Act and will not take any action or file any document
(whether or not permitted by Exchange Act or the rules  thereunder) to terminate
or suspend such registration or to terminate or suspend its reporting and filing
obligations under said Exchange Act.

      Section 6.4. Transfer Agent Instructions.  Not later than two (2) business
days after each Advance  Notice Date and prior to each Closing and resale of the
Common  Stock by the  Investor,  the Company will  deliver  instructions  to its
transfer agent to issue shares of Common Stock free of restrictive legends.


                                       16
<PAGE>

      Section  6.5.  Corporate  Existence.  The  Company  will  take  all  steps
necessary to preserve and continue the corporate existence of the Company.

      Section 6.6. Notice of Certain Events Affecting  Registration;  Suspension
of Right to Make an Advance.  The Company will  immediately  notify the Investor
upon its becoming  aware of the  occurrence  of any of the  following  events in
respect  of a  registration  statement  or  related  prospectus  relating  to an
offering of  Registrable  Securities:  (i) receipt of any request for additional
information  by the SEC or any other  Federal  or state  governmental  authority
during the period of effectiveness of the Registration  Statement for amendments
or supplements to the  registration  statement or related  prospectus;  (ii) the
issuance by the SEC or any other Federal or state governmental  authority of any
stop order suspending the  effectiveness  of the  Registration  Statement or the
initiation  of  any  proceedings   for  that  purpose;   (iii)  receipt  of  any
notification  with respect to the suspension of the  qualification  or exemption
from  qualification  of  any of  the  Registrable  Securities  for  sale  in any
jurisdiction  or the  initiation  or  threatening  of any  proceeding  for  such
purpose;  (iv) the happening of any event that makes any  statement  made in the
Registration  Statement or related  prospectus of any document  incorporated  or
deemed to be incorporated therein by reference untrue in any material respect or
that requires the making of any changes in the Registration  Statement,  related
prospectus or documents so that, in the case of the Registration  Statement,  it
will not contain any untrue  statement  of a material  fact or omit to state any
material fact required to be stated  therein or necessary to make the statements
therein not misleading,  and that in the case of the related prospectus, it will
not  contain  any  untrue  statement  of a  material  fact or omit to state  any
material fact required to be stated  therein or necessary to make the statements
therein,  in the light of the  circumstances  under  which they were  made,  not
misleading; and (v) the Company's reasonable determination that a post-effective
amendment to the  Registration  Statement would be appropriate;  and the Company
will promptly make available to the Investor any such supplement or amendment to
the related  prospectus.  The  Company  shall not  deliver to the  Investor  any
Advance Notice during the continuation of any of the foregoing events.

      Section 6.7. Expectations Regarding Advance Notices.  Within ten (10) days
after the  commencement  of each calendar  quarter  occurring  subsequent to the
commencement of the Commitment Period, the Company must notify the Investor,  in
writing, as to its reasonable expectations as to the dollar amount it intends to
raise  during such  calendar  quarter,  if any,  through the issuance of Advance
Notices.  Such  notification  shall  constitute  only the  Company's  good faith
estimate and shall in no way  obligate the Company to raise such amount,  or any
amount,  or otherwise limit its ability to deliver Advance Notices.  The failure
by the  Company  to comply  with this  provision  can be cured by the  Company's
notifying  the  Investor,   in  writing,  at  any  time  as  to  its  reasonable
expectations with respect to the current calendar quarter.

      Section 6.8.  Restriction on Sale of Capital Stock.  During the Commitment
Period,  the Company shall not issue or sell,  without the prior written consent
of the Investor,  (i) any Common Stock or Preferred Stock without  consideration
or for a  consideration  per share less than the bid price of the  Common  Stock
determined  immediately prior to its issuance,  (ii) issue or sell any Preferred
Stock warrant,  option, right,  contract,  call, or other security or instrument
granting  the  holder   thereof  the  right  to  acquire  Common  Stock  without
consideration or for a consideration per share less than such Common Stock's Bid
Price  determined   immediately  prior  to  its  issuance,  or  (iii)  file  any
registration statement on Form S-8; provided that with respect to items (ii) and
(iii)  hereunder  after the one year  anniversary  hereof,  upon a minimum of 10
days' prior written notice,  the Company may at its discretion grant warrants or
options  to its  employees  in an  amount  not to  exceed  10% of the  Company's
outstanding Common Stock.


                                       17
<PAGE>

      Section 6.9.  Consolidation;  Merger.  The Company  shall not, at any time
after the date hereof, without the prior written consent of the Investor, effect
any merger or consolidation of the Company with or into, or a transfer of all or
substantially  all the assets of the Company to another entity (a "Consolidation
Event")  regardless of whether the Company is the surviving entity,  unless such
Consolidation  Event would result in the Investor receiving earning a net return
of 100% on the  investment  made pursuant to that  Investment  Agreement of even
date herewith.

      Section  6.10.  Issuance of the Company's  Common  Stock.  The sale of the
shares of Common  Stock  shall be made in  accordance  with the  provisions  and
requirements of Regulation D and any applicable state securities law.

                                  ARTICLE VII.
                Conditions for Advance and Conditions to Closing

      Section 7.1. Conditions  Precedent to the Obligations of the Company.  The
obligation hereunder of the Company to issue and sell the shares of Common Stock
to the  Investor  incident to each  Closing is subject to the  satisfaction,  or
waiver by the Company, at or before each such Closing, of each of the conditions
set forth below.

            (a) Accuracy of the Investor's  Representations and Warranties.  The
representations  and warranties of the Investor shall be true and correct in all
material respects.

            (b) Performance by the Investor.  The Investor shall have performed,
satisfied  and  complied in all  respects  with all  covenants,  agreements  and
conditions  required by this Agreement and the Registration  Rights Agreement to
be  performed,  satisfied  or complied  with by the Investor at or prior to such
Closing.

      Section 7.2.  Conditions  Precedent to the Right of the Company to Deliver
an Advance  Notice and the  Obligation  of the  Investor to  Purchase  Shares of
Common  Stock.  The right of the  Company to  deliver an Advance  Notice and the
obligation  of the  Investor  hereunder  to  acquire  and pay for  shares of the
Company's  Common Stock  incident to a Closing is subject to the  fulfillment by
the  Company,  on (i) the date of delivery of such  Advance  Notice and (ii) the
applicable Advance Date (each a "Condition  Satisfaction  Date"), of each of the
following conditions:

            (a) Listing of the  Company's  Common Stock.  The  Company's  Common
Stock shall have been  authorized  for quotation on the National  Association of
Securities Dealers Inc.'s Over the Counter Bulletin Board.


                                       18
<PAGE>

            (b) Registration of the Common Stock with the SEC. The Company shall
have filed with the SEC a  Registration  Statement with respect to the resale of
the  Registrable  Securities  in accordance  with the terms of the  Registration
Rights  Agreement.  As set  forth  in the  Registration  Rights  Agreement,  the
Registration  Statement shall have previously  become effective and shall remain
effective on each  Condition  Satisfaction  Date and (i) neither the Company nor
the Investor  shall have  received  notice that the SEC has issued or intends to
issue a stop order with  respect to the  Registration  Statement or that the SEC
otherwise  has  suspended or withdrawn  the  effectiveness  of the  Registration
Statement, either temporarily or permanently, or intends or has threatened to do
so (unless the SEC's concerns have been addressed and the Investor is reasonably
satisfied that the SEC no longer is considering or intends to take such action),
and (ii) no other  suspension of the use or withdrawal of the  effectiveness  of
the Registration  Statement or related  prospectus shall exist. The Registration
Statement  must  have  been  declared  effective  by the SEC  prior to the first
Advance Notice Date.

            (c)  Authority.  The  Company  shall have  obtained  all permits and
qualifications   required  by  any  applicable  state  in  accordance  with  the
Registration  Rights  Agreement  for the offer and sale of the  shares of Common
Stock,  or shall have the  availability  of exemptions  therefrom.  The sale and
issuance of the shares of Common  Stock shall be legally  permitted  by all laws
and regulations to which the Company is subject.

            (d)  Fundamental  Changes.  There  shall not  exist any  fundamental
changes to the information set forth in the  Registration  Statement which would
require  the  Company to file a  post-effective  amendment  to the  Registration
Statement.

            (e)  Performance by the Company.  The Company shall have  performed,
satisfied and complied in all material  respects with all covenants,  agreements
and conditions required by this Agreement  (including,  without limitation,  the
conditions  specified  in  Section  2.5  hereof)  and  the  Registration  Rights
Agreement to be performed, satisfied or complied with by the Company at or prior
to each Condition Satisfaction Date.

            (f) No Injunction.  No statute, rule,  regulation,  executive order,
decree,  ruling or injunction shall have been enacted,  entered,  promulgated or
endorsed by any court or governmental  authority of competent  jurisdiction that
prohibits or directly and adversely affects any of the transactions contemplated
by this Agreement, and no proceeding shall have been commenced that may have the
effect  of   prohibiting  or  adversely   affecting  any  of  the   transactions
contemplated by this Agreement.

            (g) No Suspension  of Trading in or Delisting of Common  Stock.  The
trading of the Common Stock has  commenced on the  Principal  Market and has not
been  suspended by the SEC or the  Principal  Market.  The issuance of shares of
Common Stock with respect to the applicable  Closing,  if any, shall not violate
the  shareholder  approval  requirements  of the Principal  Market (if any). The
Company shall not have received any notice  threatening the continued listing of
the Common Stock on the Principal Market.

            (h) Maximum Advance Amount.  The amount of any Advance  requested by
the Company  shall not exceed the Maximum  Advance  Amount.  In addition,  in no
event shall the number of shares issuable to the Investor pursuant to an Advance
cause the Investor to beneficially own in excess of nine and 9/10 percent (9.9%)
of the then outstanding Common Stock of the Company.


                                       19
<PAGE>

            (i) No  Knowledge.  The Company has no  knowledge of any event which
would be more  likely than not to have the effect of causing  such  Registration
Statement to be suspended or otherwise ineffective.

            (j) Other. On each Condition  Satisfaction  Date, the Investor shall
have received the certificate  executed by an officer of the Company in the form
of Exhibit A attached hereto.

                                  ARTICLE VIII.
         Due Diligence Review; Non-Disclosure of Non-Public Information

      Section 8.1. Due Diligence Review. Prior to the filing of the Registration
Statement the Company  shall make  available  for  inspection  and review by the
Investor,  advisors to and  representatives  of the  Investor,  any  underwriter
participating in any disposition of the Registrable  Securities on behalf of the
Investor pursuant to the Registration Statement, any such registration statement
or amendment or supplement  thereto or any blue sky,  NASD or other filing,  all
financial and other  records,  all SEC Documents and other filings with the SEC,
and all other  corporate  documents  and  properties  of the  Company  as may be
reasonably  necessary  for the purpose of such review,  and cause the  Company's
officers,  directors  and  employees to supply all such  information  reasonably
requested by the Investor or any such representative,  advisor or underwriter in
connection with such Registration Statement (including,  without limitation,  in
response to all questions and other  inquiries  reasonably  made or submitted by
any of them),  prior to and from time to time after the filing and effectiveness
of the Registration  Statement for the sole purpose of enabling the Investor and
such representatives, advisors and underwriters and their respective accountants
and attorneys to conduct  initial and ongoing due diligence  with respect to the
Company and the accuracy of the Registration Statement.

      Section 8.2. Non-Disclosure of Non-Public Information.

            (a) The Company  shall not disclose  non-public  information  to the
Investor,  advisors  to or  representatives  of the  Investor  unless  prior  to
disclosure of such information the Company  identifies such information as being
non-public   information   and  provides  the   Investor,   such   advisors  and
representatives  with the  opportunity  to  accept  or  refuse  to  accept  such
non-public information for review. The Company may, as a condition to disclosing
any  non-public  information  hereunder,  require the  Investor's  advisors  and
representatives  to enter into a  confidentiality  agreement in form  reasonably
satisfactory to the Company and the Investor.

            (b) Nothing herein shall require the Company to disclose  non-public
information to the Investor or its advisors or representatives,  and the Company
represents that it does not disseminate  non-public information to any investors
who purchase stock in the Company in a public offering,  to money managers or to
securities analysts,  provided, however, that notwithstanding anything herein to
the contrary, the Company will, as hereinabove provided,  immediately notify the
advisors and representatives of the Investor and, if any,  underwriters,  of any
event or the existence of any  circumstance  (without any obligation to disclose
the specific  event or  circumstance)  of which it becomes  aware,  constituting
non-public  information (whether or not requested of the Company specifically or
generally  during  the course of due  diligence  by such  persons or  entities),
which, if not disclosed in the prospectus included in the Registration Statement
would  cause such  prospectus  to include a material  misstatement  or to omit a
material  fact  required to be stated  therein in order to make the  statements,
therein,  in light of the circumstances in which they were made, not misleading.
Nothing  contained  in this  Section  8.2 shall be  construed  to mean that such
persons or entities other than the Investor  (without the written consent of the
Investor  prior to disclosure  of such  information)  may not obtain  non-public
information  in the course of conducting  due  diligence in accordance  with the
terms of this  Agreement  and nothing  herein shall  prevent any such persons or
entities  from  notifying  the Company of their  opinion  that based on such due
diligence by such persons or entities,  that the Registration Statement contains
an untrue  statement of material  fact or omits a material  fact  required to be
stated  in the  Registration  Statement  or  necessary  to make  the  statements
contained  therein,  in light of the  circumstances in which they were made, not
misleading.


                                       20
<PAGE>

                                   ARTICLE IX.
                           Choice of Law/Jurisdiction

      Section  9.1.  Governing  Law.  This  Agreement  shall be  governed by and
interpreted  in  accordance  with the laws of the  State of New  Jersey  without
regard to the principles of conflict of laws. The parties further agree that any
action between them shall be heard exclusively in Hudson County, New Jersey, and
expressly  consent to the  jurisdiction  and venue of the Superior  Court of New
Jersey,  sitting in Hudson  County,  New Jersey and the United  States  District
Court of New Jersey,  sitting in Newark, New Jersey, for the adjudication of any
civil action asserted pursuant to this paragraph.

                                   ARTICLE X.
                             Assignment/Termination

      Section  10.1.  Assignment.  Neither this  Agreement nor any rights of the
Company hereunder may be assigned to any other Person.

      Section  10.2.  Termination.  The  obligations  of the  Investor  to  make
Advances under Article II hereof shall terminate  twenty-four  (24) months after
the Effective Date.

                                   ARTICLE XI.
                                     Notices

      Section  11.1.  Notices.   Any  notices,   consents,   waivers,  or  other
communications  required  or  permitted  to be  given  under  the  terms of this
Agreement  must be in writing and will be deemed to have been delivered (i) upon
receipt, when delivered  personally;  (ii) upon receipt, when sent by facsimile,
provided a copy is mailed by U.S.  certified  mail,  return  receipt  requested;
(iii) three (3) days after being sent by U.S.  certified  mail,  return  receipt
requested,  or (iv)  one (1) day  after  deposit  with a  nationally  recognized
overnight  delivery  service,  in each case  properly  addressed to the party to
receive the same.  The addresses and facsimile  numbers for such  communications
shall be:


                                       21
<PAGE>

If to the Company, to:          Ipoint-Media Ltd.
                                2a Habarzel Street
                                Tel-Aviv 61132, Israel
                                Attention:  Muki Geller
                                Telephone:  972-3-7657265
                                Facsimile:  972-3-7657139

With a copy to:                 Sichenzia Ross Friedman Ference LLP
                                1065 Avenue of the Americas
                                New York, New York 10018
                                Attn:       Gregory Sichenzia
                                Telephone:  (212) 930-9700
                                Facsimile:  (212) 930-9725

If to the Investor(s):          Cornell Capital Partners, LP
                                101 Hudson Street -Suite 3700
                                Jersey City, NJ 07302
                                Attention:  Mark Angelo
                                            Portfolio Manager
                                Telephone:  (201) 985-8300
                                Facsimile:  (201) 985-8266

With a copy to:                 Cornell Capital Partners, LP
                                101 Hudson Street -Suite 3700
                                Jersey City, NJ 07302
                                Attention:  Troy J. Rillo, Esq.
                                            Senior Vice President
                                Telephone:  (201) 985-8300
                                Facsimile:  (201) 985-8266

Each party shall provide five (5) days' prior written  notice to the other party
of any change in address or facsimile number.

                                  ARTICLE XII.
                                  Miscellaneous

      Section 12.1. Counterparts.  This Agreement may be executed in two or more
identical  counterparts,  all of  which  shall  be  considered  one and the same
agreement and shall become effective when  counterparts have been signed by each
party and  delivered  to the other  party.  In the event any  signature  page is
delivered  by  facsimile  transmission,  the party  using such means of delivery
shall  cause  four  (4)  additional  original  executed  signature  pages  to be
physically  delivered to the other party  within five (5) days of the  execution
and delivery hereof,  though failure to deliver such copies shall not affect the
validity of this Agreement.

      Section 12.2. Entire Agreement;  Amendments. This Agreement supersedes all
other prior oral or written agreements between the Investor,  the Company, their
affiliates  and  persons  acting on their  behalf  with  respect to the  matters
discussed  herein,  and this  Agreement and the  instruments  referenced  herein
contain  the entire  understanding  of the parties  with  respect to the matters
covered  herein and therein  and,  except as  specifically  set forth  herein or
therein,  neither  the  Company  nor  the  Investor  makes  any  representation,
warranty,  covenant or undertaking with respect to such matters. No provision of
this  Agreement  may be waived or amended other than by an instrument in writing
signed by the party to be charged with enforcement.


                                       22
<PAGE>

      Section 12.3.  Reporting Entity for the Common Stock. The reporting entity
relied upon for the  determination of the trading price or trading volume of the
Common Stock on any given Trading Day for the purposes of this  Agreement  shall
be Bloomberg,  L.P. or any successor thereto.  The written mutual consent of the
Investor and the Company shall be required to employ any other reporting entity.

      Section  12.4.  Fees and  Expenses.  The Company  hereby agrees to pay the
following fees:

            (a) Legal Fees.  Except as provided in Section 12.4(b),  each of the
parties  shall  pay  its  own  fees  and  expenses  (including  the  fees of any
attorneys,  accountants,   appraisers  or  others  engaged  by  such  party)  in
connection with this Agreement and the transactions contemplated hereby.

            (b)  Structuring  Fees.  The Company shall pay the Investor a fee of
$75,000 for  due-diligence  and  structuring  fees,  as well as to reimburse the
Investor for legal fees and expenses.  This fee shall be deducted from the gross
proceeds  to be paid by the  Investor  to the  Company  in  connection  with the
Investor's  $1,000,000  equity  investment in the Company of even date herewith.
This fee shall be deemed fully earned on the date hereof.

            (c) Commitment Fees.

                  (i)  On  each  Advance  Date  the  Company  shall  pay  to the
Investor,  directly from the gross  proceeds held in escrow,  an amount equal to
five percent (5%) of the amount of each Advance.  The Company hereby agrees that
if such  payment,  as is  described  above,  is not made by the  Company  on the
Advance  Date,  such  payment  will be made at the  direction of the Investor as
outlined and mandated by Section 2.3 of this Agreement.

                  (ii) Upon the  listing of the  Company's  common  stock on the
OTCBB,  the Company shall issue to the Investor  shares of the Company's  Common
Stock equal to $200,000  (the "First  Investor's  Shares").  The number of First
Investor's  Shares shall be determined  using the Conversion  Price as set forth
below.

                  (iii) On the first  anniversary  (the "First  Anniversary") of
the effectiveness of a registration statement registering the Common Stock to be
issued  hereunder,  the  Company  shall  issue  to the  Investor  shares  of the
Company's  Common  Stock equal to $190,000  (the  "Second  Investor's  Shares");
provided  that the  Investor  shall only be entitled to the Bonus  Shares if the
Company (i) receives gross  proceeds  hereunder of $5,000,000 or more during the
one year period  beginning  on the  effectiveness  of a  registration  statement
registering  the  Common  Stock  to be  issued  hereunder  and  ending  one year
thereafter  or (ii) the Company does not terminate  this  Agreement on or before
the First  Anniversary.  Such shares  shall be valued at the  Issuance  Price as
determined in accordance with Section  12.4(c)(ii)  hereof. The number of Second
Investor's  Shares shall be determined  using the Conversion  Price as set forth
below.


                                       23
<PAGE>

                  (iv) Conversion  Price. The Conversion Price shall be equal to
the highest of either (i) the initial bid price (the "Initial Bid Price") of the
Company's  Common  Stock as  submitted  by a market  maker and  accepted  by the
National  Association of Securities Dealers,  Inc. or (ii) the closing bid price
of the Company's  Common Stock on the 60th day (or if such date is not a Trading
Day then the next  Trading Day)  following  date the  Company's  Common Stock is
first quoted on the Principal Market;  provided that if the Initial Bid Price is
less than $1.00 per Ordinary Share or the total  outstanding  Ordinary Shares is
less than  20,000,000,  then the Conversion  Price shall be equal to the Initial
Bid Price.

                  (v) Fully Earned.  The Investor's  Shares and the Bonus Shares
shall be deemed  fully  earned as of the date  hereof;  provided  that the Bonus
Shares  shall be subject to the  conditions  specified  in Section  12.4(c)(iii)
hereof.

                  (vi) Registration  Rights. The Investor's Shares and the Bonus
Shares shall be included in any registration filed by the Company.

      Section 12.5. Brokerage. Each of the parties hereto represents that it has
had no dealings in connection  with this  transaction  with any finder or broker
who will  demand  payment of any fee or  commission  from the other  party.  The
Company on the one hand, and the Investor, on the other hand, agree to indemnify
the other against and hold the other  harmless from any and all  liabilities  to
any  person  claiming  brokerage  commissions  or  finder's  fees on  account of
services  purported to have been rendered on behalf of the indemnifying party in
connection with this Agreement or the transactions contemplated hereby.

      Section  12.6.  Confidentiality.   If  for  any  reason  the  transactions
contemplated by this Agreement are not  consummated,  each of the parties hereto
shall keep  confidential  any information  obtained from any other party (except
information  publicly  available  or in such  party's  domain  prior to the date
hereof,  and except as required by court order) and shall promptly return to the
other  parties  all  schedules,  documents,  instruments,  work  papers or other
written information without retaining copies thereof, previously furnished by it
as a result of this Agreement or in connection herein.

                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]


                                       24
<PAGE>

      IN WITNESS  WHEREOF,  the parties  hereto have caused this Standby  Equity
Distribution  Agreement  to be  executed  by  the  undersigned,  thereunto  duly
authorized, as of the date first set forth above.

                                     COMPANY:
                                     IPOINT-MEDIA LTD..

                                     By:/s/ Muki Geller
                                     Name: Muki Geller
                                     Title: President


                                     INVESTOR:
                                     CORNELL CAPITAL PARTNERS, LP

                                     By:  Yorkville Advisors, LLC
                                     Its: General Partner

                                     By: /s/Mark Angelo
                                     Name: Mark Angelo
                                     Title: Portfolio Manager


                                       25
<PAGE>

                                    EXHIBIT A

                      ADVANCE NOTICE/COMPLIANCE CERTIFICATE

                                IPOINT-MEDIA LTD.


      The undersigned, _______________________ hereby certifies, with respect to
the sale of  shares  of  Common  Stock of  iPoint-Media  Ltd.  (the  "Company"),
issuable in connection with this Advance Notice and Compliance Certificate dated
___________________  (the  "Notice"),  delivered  pursuant to the Standby Equity
Distribution Agreement (the "Agreement"), as follows:

      1. The undersigned is the duly elected President of the Company.

      2. There are no fundamental  changes to the  information  set forth in the
Registration  Statement which would require the Company to file a post effective
amendment to the Registration Statement.

      3. The Company has  performed in all material  respects all  covenants and
agreements  to be  performed  by the  Company  on or prior to the  Advance  Date
related  to the  Notice  and has  complied  in all  material  respects  with all
obligations and conditions contained in the Agreement.

      4. The undersigned hereby  represents,  warrants and covenants that it has
made  all  filings  ("SEC  Filings")  required  to be  made  by it  pursuant  to
applicable securities laws (including,  without limitation, all filings required
under the Securities  Exchange Act of 1934, which include Forms 10-Q, 10-K, 8-K,
etc.  All  SEC  Filings  and  other  public  disclosures  made  by the  Company,
including,  without limitation, all press releases, analysts meetings and calls,
etc. (collectively,  the "Public Disclosures"),  have been reviewed and approved
for release by the Company's attorneys and, if containing financial information,
the Company's  independent  certified public accountants.  None of the Company's
Public  Disclosures  contain any untrue  statement of a material fact or omit to
state any material fact  required to be stated  therein or necessary to make the
statements  therein,  in the light of the  circumstances  under  which they were
made, not misleading.

      5. The Advance requested is _____________________.

      The   undersigned  has  executed  this   Certificate   this  ____  day  of
______________.

                                   IPOINT-MEDIA LTD.


                                   By:
                                      ----------------------------
                                   Name:  Muki Geller
                                   Title: President


                                   EXHIBIT A-1

<PAGE>

                                    EXHIBIT B

                              DISCLOSURE STATEMENT


                                   EXHIBIT B-1
<PAGE>

                                  SCHEDULED 2.6

                                IPOINT-MEDIA LTD.

      The  undersigned  hereby  agrees that for a period  commencing on the date
hereof and  expiring  on the  termination  of the  Agreement  dated May __, 2004
between iPoint-Media Ltd. (the "Company") and Cornell Capital Partners,  LP (the
"Investor")  (the  "Lock-up  Period"),  he,  she or it  will  not,  directly  or
indirectly,  without the prior written  consent of the Investor,  issue,  offer,
agree or offer to sell,  sell,  grant an  option  for the  purchase  or sale of,
transfer,  pledge,  assign,  hypothecate,  distribute  or otherwise  encumber or
dispose of except  pursuant  to Rule 144 of the  General  Rules and  Regulations
under the  Securities  Act of 1933,  any  securities  of the Company,  including
common  stock or  options,  rights,  warrants  or other  securities  underlying,
convertible  into,  exchangeable  or exercisable  for or evidencing any right to
purchase or subscribe for any common stock (whether or not beneficially owned by
the  undersigned),  or  any  beneficial  interest  therein  (collectively,   the
"Securities").

      In order to enable the aforesaid covenants to be enforced, the undersigned
hereby consents to the placing of legends and/or  stop-transfer  orders with the
transfer agent of the Company's securities with respect to any of the Securities
registered  in  the  name  of  the  undersigned  or  beneficially  owned  by the
undersigned, and the undersigned hereby confirms the undersigned's investment in
the Company.

Dated: _______________, 2004

                                    Signature


                                    --------------------------------------------
                                    Address:
                                            ------------------------------------
                                    City, State, Zip Code:
                                                          ----------------------



                                    --------------------------------------------
                                    Print Social Security Number
                                    or Taxpayer I.D. Number


                                 SCHEDULE 2.6-1