STATMON TECHNOLOGIES CORP.
                            AUDIT COMMITTEE CHARTER

PURPOSE

      The Audit  Committee  is appointed by the Board of Directors to assist the
Board of Directors in monitoring  (1) the integrity of the financial  statements
of Statmon  Technologies  Corp. (the "Company"),  (2) the independent  auditor's
qualifications  and independence,  (3) the performance of the Company's internal
audit function and independent  auditors,  and (4) the compliance by the Company
with legal and regulatory requirements.

      The Audit  Committee will prepare the report  required by the rules of the
Securities  and Exchange  Commission  (the  "Commission")  to be included in the
Company's annual proxy statement.

COMMITTEE MEMBERSHIP

      The Audit Committee will consist of no fewer than two members. The members
of the Audit Committee will meet the independence and experience requirements of
Section  10A(m)(3) of the Securities  Exchange Act of 1934 (the "Exchange  Act")
and the rules and  regulations  of the  Commission.  At least one  member of the
Audit Committee will be a financial  expert as defined by the Commission.  Audit
committee members will not simultaneously  serve on the audit committees of more
than two other public companies.

      The  members  of the Audit  Committee  will be  appointed  by the Board of
Directors. Audit Committee members may be replaced by the Board of Directors.

MEETINGS

      The  Audit  Committee  will meet as often as it  determines,  but not less
frequently  than  quarterly.  The Audit  Committee will meet  periodically  with
management,  the  internal  auditors  and the  independent  auditor in  separate
executive  sessions.  The Audit Committee may request any officer or employee of
the Company or the Company's outside counsel or independent  auditor to attend a
meeting of the Committee or to meet with any members of, or consultants  to, the
Committee.

COMMITTEE AUTHORITY AND RESPONSIBILITIES

      The Audit Committee will have the sole authority to appoint or replace the
independent auditor (subject, if applicable, to shareholder  ratification).  The
Audit Committee will be directly  responsible for the compensation and oversight
of the work of the independent  auditor  (including  resolution of disagreements
between management and the independent  auditor regarding  financial  reporting)
for the purpose of  preparing or issuing an audit  report or related  work.  The
independent auditor will report directly to the Audit Committee.

      The Audit Committee will  pre-approve all auditing  services and permitted
non-audit  services  (including  the fees and terms thereof) to be performed for
the Company by its independent auditor, subject to the de minimus exceptions for
non-audit services  described in Section  10A(i)(1)(B) of the Exchange Act which
are approved by the Audit  Committee  prior to the completion of the audit.  The
Audit Committee may form and delegate  authority to subcommittees  consisting of
one  or  more  members  when  appropriate,  including  the  authority  to  grant
pre-approvals of audit and permitted non-audit services, provided that decisions
of such subcommittee to grant  pre-approvals will be presented to the full Audit
Committee at its next scheduled meeting.

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      The  Audit  Committee  will  have the  authority,  to the  extent it deems
necessary or  appropriate,  to retain  independent  legal,  accounting  or other
advisors. The Company will provide for appropriate funding, as determined by the
Audit Committee,  for payment of compensation to the independent auditor for the
purpose of rendering or issuing an audit report and to any advisors  employed by
the Audit Committee.

      The Audit  Committee  will make  regular  reports to the Board.  The Audit
Committee  will review and reassess  the  adequacy of this Charter  annually and
recommend any proposed  changes to the Board for approval.  The Audit  Committee
will annually review the Audit Committee's own performance.

      The Audit Committee, to the extent it deems necessary or appropriate, will
perform the following functions:

Financial Statement and Disclosure Matters

1.    Review and discuss with management and the independent  auditor the annual
      audited financial  statements,  including disclosures made in management's
      discussion  and  analysis,  and recommend to the Board whether the audited
      financial statements should be included in the Company's Form 10-KSB.

2.    Review  and  discuss  with  management  and the  independent  auditor  the
      Company's quarterly  financial  statements prior to the filing of its Form
      10-Q,  including the results of the  independent  auditor's  review of the
      quarterly financial statements.

3.    Discuss with management and the independent auditor significant  financial
      reporting  issues and judgments made in connection with the preparation of
      the Company's financial  statements,  including any significant changes in
      the Company's selection or application of accounting principles, any major
      issues as to the  adequacy  of the  Company's  internal  controls  and any
      special steps adopted in light of material control deficiencies.

4.    Review and discuss quarterly reports from the independent auditors on:

      (a)   All critical accounting policies and practices to be used.

      (b)   All alternative treatments of financial information within generally
            accepted  accounting   principles  that  have  been  discussed  with
            management, ramifications of the use of such alternative disclosures
            and  treatments,  and the  treatment  preferred  by the  independent
            auditor.

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      (c)   Other  material  written   communications  between  the  independent
            auditor and management, such as any management letter or schedule of
            unadjusted differences.

5.    Discuss with management the Company's  earnings press releases,  including
      the use of "pro  forma" or  "adjusted"  non-GAAP  information,  as well as
      financial  information  and  earnings  guidance  provided to analysts  and
      rating  agencies.  Such  discussion may be done  generally  (consisting of
      discussing  the  types of  information  to be  disclosed  and the types of
      presentations to be made).

6.    Discuss  with  management  and  the  independent  auditor  the  effect  of
      regulatory  and  accounting  initiatives  as  well  as  off-balance  sheet
      structures on the Company's financial statements.

7.    Discuss with  management the Company's  major financial risk exposures and
      the steps  management  has taken to monitor  and control  such  exposures,
      including the Company's risk assessment and risk management policies.

8.    Discuss with the independent  auditor the matters required to be discussed
      by Statement on Auditing  Standards  No. 61 relating to the conduct of the
      audit,  including any difficulties  encountered in the course of the audit
      work, any  restrictions  on the scope of activities or access to requested
      information, and any significant disagreements with management.

9.    Review  disclosures  made to the Audit  Committee by the Company's CEO and
      CFO during their  certification  process for the Form 10-KSB and Form 10-Q
      about any significant  deficiencies in the design or operation of internal
      controls or material weaknesses therein and any fraud involving management
      or other employees who have a significant  role in the Company's  internal
      controls.

            Oversight of the Company's Relationship with the Independent Auditor

10.   Review and evaluate the lead partner of the independent auditor team.

11.   Obtain  and  review  a  report  from  the  independent  auditor,  at least
      annually, regarding (a) the independent auditor's internal quality-control
      procedures,  (b) any material  issues  raised by the most recent  internal
      quality-control  review, or peer review, of the firm, or by any inquiry or
      investigation  by  governmental  or  professional  authorities  within the
      preceding five years respecting one or more independent audits carried out
      by the firm, (c) any steps taken to deal with any such issues, and (d) all
      relationships  between the independent  auditor and the Company.  Evaluate
      the  qualifications,  performance  and  independence  of  the  independent
      auditor,  including considering whether the auditor's quality controls are
      adequate and the provision of permitted  non-audit  services is compatible
      with maintaining the auditor's  independence,  and taking into account the
      opinions of management  and internal  auditors.  The Audit  Committee will
      present its  conclusions  with respect to the  independent  auditor to the
      Board.

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12.   Ensure the rotation of the lead (or  coordinating)  audit  partner  having
      primary responsibility for the audit and the audit partner responsible for
      reviewing  the audit as required  by law.  Consider  whether,  in order to
      assure  continuing  auditor  independence,  it is  appropriate  to adopt a
      policy of rotating the independent auditing firm on a regular basis.

13.   Recommend to the Board  policies for the Company's  hiring of employees or
      former  employees  of the  independent  auditor  who  participated  in any
      capacity in the audit of the Company.

14.   Discuss  with the national  office of the  independent  auditor  issues on
      which they were consulted by the Company's audit team and matters of audit
      quality and consistency.

15.   Meet  with the  independent  auditor  prior to the  audit to  discuss  the
      planning and staffing of the audit.

Oversight of the Company's Internal Audit Function

16.   Review the appointment  and  replacement of the senior  internal  auditing
      executive.

17.   Review the  significant  reports to  management  prepared by the  internal
      auditing department and management's responses.

18.   Discuss with the  independent  auditor and  management  the internal audit
      department  responsibilities,  budget  and  staffing  and any  recommended
      changes in the planned scope of the internal audit.

Compliance Oversight Responsibilities

19.   Obtain from the independent  auditor  assurance that Section 10A(b) of the
      Exchange Act has not been implicated.

20.   Obtain reports from  management,  the Company's  senior internal  auditing
      executive   and  the   independent   auditor  that  the  Company  and  its
      subsidiary/foreign  affiliated  entities are in conformity with applicable
      legal  requirements and the Company's Code of Business Conduct and Ethics.
      Review  reports  and   disclosures   of  insider  and   affiliated   party
      transactions.  Advise the Board with respect to the Company's policies and
      procedures  regarding  compliance with applicable laws and regulations and
      with the Company's Code of Ethics.

21.   Establish   procedures  for  the  receipt,   retention  and  treatment  of
      complaints  received  by  the  Company  regarding   accounting,   internal
      accounting controls or auditing matters,  and the confidential,  anonymous
      submission by employees of concerns regarding  questionable  accounting or
      auditing matters.

22.   Discuss with  management and the  independent  auditor any  correspondence
      with regulators or governmental  agencies and any published  reports which
      raise  material  issues  regarding the Company's  financial  statements or
      accounting policies.

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23.   Discuss with the Company's  legal counsel matters that may have a material
      impact on the financial statements or the Company's compliance policies.

LIMITATION OF AUDIT COMMITTEE'S ROLE

      The function of the Audit  Committee is oversight.  The  management of the
Company is responsible for the  preparation,  presentation  and integrity of the
Company's financial statements.  Management and the internal auditing department
are responsible for maintaining  appropriate  accounting and financial reporting
principles and policies and internal controls and procedures  designed to assure
compliance with accounting  standards and applicable laws and  regulations.  The
outside auditors are responsible for planning and carrying out a proper audit of
the Company's annual financial  statements,  reviews of the Company's  quarterly
financial  statements prior to the filing of each quarterly report on Form 10-Q,
and other  procedures.  In fulfilling their  responsibilities  hereunder,  it is
recognized  that members of the Audit  Committee are not full-time  employees of
the Company and, except for the financial expert on the Committee,  are not, and
do not  represent  themselves  to be,  accountants  or auditors by profession or
experts in the fields of accounting or auditing, including in respect of auditor
independence. It is not the duty or responsibility of the Audit Committee or its
members to conduct "field work" or other types of auditing or accounting reviews
or procedures or to set auditor independence  standards,  and each member of the
Audit  Committee  will be entitled to rely on (i) the integrity of those persons
and  organizations  within  and  outside  the  Company  from  which it  receives
information,  (ii) the accuracy of the financial and other information  provided
to the Audit Committee by such persons or organizations  absent actual knowledge
to the contrary (which will be promptly reported to the Board of Directors), and
(iii)  representations  made by  management  as to any  information  technology,
internal  audit and other  non-audit  services  provided by the  auditors to the
Company.

      Accordingly, while the Audit Committee has the responsibilities and powers
set forth in this Charter,  it is not the duty of the Audit Committee to plan or
conduct  audits or to determine  that the  Company's  financial  statements  and
disclosures  are  complete and accurate  and are in  accordance  with  generally
accepted accounting  principles and applicable rules and regulations.  These are
the responsibilities of management and the independent auditor.


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