| x | Quarterly                report under Section 13 or 15(d) of the Securities Exchange Act of                1934 |
|---|-----------------------------------------------------------------------------------------------------------------|
|   |  |
|--------|--|
|   | For the quarterly period ended June              30, 2006 |
|--------|-----------------------------------------------------------|

| o | Transition                report under Section 13 or 15(d) of the Exchange                Act |
|---|-----------------------------------------------------------------------------------------------|
|   |   |
|--------|--------|
|   | For the transition period from _____________              to _____________ |
|--------|----------------------------------------------------------------------------|

| Delaware                                                                                     |   | 20-2374143                                                         |
|----------------------------------------------------------------------------------------------|--------|--------------------------------------------------------------------|
| (State                or other Jurisdiction of Incorporation                or Organization) |   | (I.R.S.                Employer Identification                No.) |

| 7                Gush Etzion, 3rd                Floor, Givaat Shmuel, Israel 54030 |
|-------------------------------------------------------------------------------------|
| (Address                of Principal Executive Office)                              |

----

**Explanatory        Note**

|                                                                                                   | Page   |
|--------------------------------------------------------------------------------------------------------|--------|
| Part                I: Financial Information:                                                          |   |
|                                                                                                   |   |
| Item                1 - Financial Statements (Unaudited):                                              |   |
|                                                                                                   |   |
| Condensed                Balance Sheet                                                                 | 3      |
|                                                                                                   |   |
| Condensed                Statements of Operations                                                      | 4      |
|                                                                                                   |   |
| Condensed                Statements of Stockholders’ Equity                                      | 5      |
|                                                                                                   |   |
| Condensed                Statements of Cash Flows                                                      | 6      |
|                                                                                                   |   |
| Notes                to Condensed Financial Statements                                                 | 7      |
|                                                                                                   |   |
| Item                2 - Management’s Discussion and Analysis or Plan of                Operation | 11     |
|                                                                                                   |   |
| Item                3 - Controls and Procedures                                                        | 13     |
|                                                                                                   |   |
| Part                II. Other Information                                                              |   |
|                                                                                                   |   |
| Item                2 - Unregistered Sales of Equity Securities and Use of                Proceeds     | 14     |
|                                                                                                   |   |
| Item                6 - Exhibits                                                                       | 14     |
|                                                                                                   |   |
| Signatures                                                                                             | 15     |

----

**ISRAEL      TECHNOLOGY ACQUISITION CORP.**

**(A      DEVELOPMENT STAGE ENTERPRISE)**

**CONDENSED      BALANCE SHEETS**

|                                                                                                        |   | **June                  30,** |       | **December                  31,** |   |
|-------------------------------------------------------------------------------------------------------------|--------|-------------------------------|------------|-----------------------------------|--------|
|                                                                                                        |   | **2006**                      |       | **2005**                          |   |
|                                                                                                        |   | **Unaudited**                 |       | **Audited**                       |   |
| **ASSETS**                                                                                                  |   |                          |       |                              |   |
|                                                                                                        |   |                          |       |                              |   |
| CURRENT                  ASSETS                                                                             |   |                          |       |                              |   |
| Cash                  and cash equivalents                                                                  |   | $                             | 382,656    |                              | $      | 372,952 |   |
| Short                  term deposit                                                                         |   |                          | -          |                              |   | 500,000 |   |
| Cash                  held in Trust Fund                                                                    |   |                          | 34,087,121 |                              |   | 33,472,678 |   |
| Prepaid                  expenses                                                                           |   |                          | -          |                              |   | 30,000 |   |
| Total                  current assets                                                                       |   | $                             | 34,469,777 |                              | $      | 34,375,630 |   |
|                                                                                                        |   |                          |       |                              |   |   |   |
| **LIABILITIES                  AND STOCKHOLDERS' EQUITY**                                                   |   |                          |       |                              |   |   |   |
|                                                                                                        |   |                          |       |                              |   |   |   |
| CURRENT                  LIABILITIES                                                                        |   |                          |       |                              |   |   |   |
|                                                                                                        |   |                          |       |                              |   |   |   |
| Accrued                  expenses                                                                           |   | $                             | 29,726     |                              | $      | 7,921 |   |
| Income                  tax payable                                                                         |   |                          | -          |                              |   | 96,000 |   |
|                                                                                                        |   |                          |       |                              |   |   |   |
| Total                  liabilities                                                                          |   |                          | 29,726     |                              |   | 103,921 |   |
|                                                                                                        |   |                          |       |                              |   |   |   |
| Common                  stock , subject to possible conversion,                                             |   |                          |       |                              |   |   |   |
| 1,262,968                  shares at conversion value                                                       |   |                          | 6,814,015  |                              |   | 6,691,188 |   |
|                                                                                                        |   |                          |       |                              |   |   |   |
| STOCKHOLDERS'                  EQUITY                                                                       |   |                          |       |                              |   |   |   |
| Share                  capital:                                                                             |   |                          |       |                              |   |   |   |
| Preferred                  Stock, $0.0001 par value -                                                       |   |                          |       |                              |   |   |   |
| Authorized:                  1,000,000 shares; none issuedCommon                  stock, $0.0001 par value- |   |                          |       |                              |   |   |   |
| Authorized                  30,000,000 shares, issued and outstanding: 7,818,000                  shares    |   |                          |       |                              |   |   |   |
| (less                  1,262,968 subject to possible conversion )                                           |   |                          | 656        |                              |   | 656 |   |
| Additional                  paid-in capital                                                            |   |                          | 27,405,347 |                              |   | 27,395,347 |   |
| Accumulated                  earnings during development stage                                              |   |                          | 220,033    |                              |   | 184,518 |   |
|                                                                                                        |   |                          |       |                              |   |   |   |
| Total                  stockholders' equity                                                            |   |                          | 27,626,036 |                              |   | 27,580,521 |   |
|                                                                                                        |   |                          |       |                              |   |   |   |
| Total                  liabilities and stockholders' equity                                            |   | $                             | 34,469,777 |                              | $      | 34,375,630 |   |

----

**ISRAEL      TECHNOLOGY ACQUISITION CORP.**

**(A      DEVELOPMENT STAGE ENERPRISE)**

**CONDENSED      STATEMENT OF OPERATIONS**

|                                                                                                                                           |   | **Three                months ended****June                30,** |      | **Three                months ended****June                30,** |   | **For                the period of six months ended****June                30,** |   | **For                the period February 22, 2005 (inception) to June                30,** |      | **For                the period February 22, 2005 (inception) to****June                30,** |   |
|------------------------------------------------------------------------------------------------------------------------------------------------|--------|------------------------------------------------------------------|-----------|------------------------------------------------------------------|--------|----------------------------------------------------------------------------------|--------|--------------------------------------------------------------------------------------------|-----------|-----------------------------------------------------------------------------------------------|--------|
|                                                                                                                                           |   | **2006**                                                         |      | **2005**                                                         |   | **2006**                                                                         |   | **2005**                                                                                   |      | **2006**                                                                                      |   |
|                                                                                                                                           |   | **Unaudited**                                                    |      | **Unaudited**                                                    |   | **Unaudited**                                                                    |   | **Unaudited**                                                                              |      | **Unaudited**                                                                                 |   |
|                                                                                                                                           |   |                                                             |      |                                                             |   |                                                                             |   |                                                                                       |      |                                                                                          |   |
| General                and administrative expenses                                                                                             |   | $                                                                | 153,211   |                                                             | $      | 1,500                                                                            |   | $                                                                                          | 433,911   |                                                                                          | $      | 2,600 |   | $ | 577,698 |   |
|                                                                                                                                           |   |                                                             |      |                                                             |   |                                                                             |   |                                                                                       |      |                                                                                          |   |   |   |   |   |   |
| Operating                loss                                                                                                                  |   |                                                             | (153,211  | )                                                                |   | (1,500                                                                           | )      |                                                                                       | (433,911  | )                                                                                             |   | (2,600 | ) |   | (577,698 | ) |
|                                                                                                                                           |   |                                                             |      |                                                             |   |                                                                             |   |                                                                                       |      |                                                                                          |   |   |   |   |   |   |
| Financial                income, net                                                                                                           |   |                                                             | 223,380   |                                                             |   | -                                                                                |   |                                                                                       | 498,821   |                                                                                          |   | - |   |   | 923,127 |   |
|                                                                                                                                           |   |                                                             |      |                                                             |   |                                                                             |   |                                                                                       |      |                                                                                          |   |   |   |   |   |   |
| Net                income ( loss ) before income taxes                                                                                         |   |                                                             | 70,169    |                                                             |   | (1,500                                                                           | )      |                                                                                       | 64,910    |                                                                                          |   | (2,600 | ) |   | 345,429 |   |
|                                                                                                                                           |   |                                                             |      |                                                             |   |                                                                             |   |                                                                                       |      |                                                                                          |   |   |   |   |   |   |
| Income                taxes                                                                                                                    |   |                                                             | -         |                                                             |   | -                                                                                |   |                                                                                       | (29,396   | )                                                                                             |   | - |   |   | (125,396 | ) |
|                                                                                                                                           |   |                                                             |      |                                                             |   |                                                                             |   |                                                                                       |      |                                                                                          |   |   |   |   |   |   |
| Net                income ( loss)                                                                                                              |   | $                                                                | 70,169    |                                                             | $      | (1,500                                                                           | )      | $                                                                                          | 35,514    |                                                                                          | $      | (2,600 | ) | $ | 220,033 |   |
|                                                                                                                                           |   |                                                             |      |                                                             |   |                                                                             |   |                                                                                       |      |                                                                                          |   |   |   |   |   |   |
|                                                                                                                                           |   |                                                             |      |                                                             |   |                                                                             |   |                                                                                       |      |                                                                                          |   |   |   |   |   |   |
|                                                                                                                                           |   |                                                             |      |                                                             |   |                                                                             |   |                                                                                       |      |                                                                                          |   |   |   |   |   |   |
| Basic                and diluted net income ( loss ) per share                                                                                 |   | $                                                                | 0.01      |                                                             | $      | (0.00                                                                            | )      | $                                                                                          | 0.01      |                                                                                          | $      | (0.00 | ) | $ | 0.04 |   |
|                                                                                                                                           |   |                                                             |      |                                                             |   |                                                                             |   |                                                                                       |      |                                                                                          |   |   |   |   |   |   |
|                                                                                                                                           |   |                                                             |      |                                                             |   |                                                                             |   |                                                                                       |      |                                                                                          |   |   |   |   |   |   |
| Weighted                average number of Common shares used in computing basic and diluted                net                income per share |   |                                                             | 6,555,032 |                                                             |   | 1,500,000                                                                        |   |                                                                                       | 6,555,032 |                                                                                          |   | 1,500,000 |   |   | 5,977,663 |   |

----

**ISRAEL      TECHNOLOGY ACQUISITION CORP.**

**(A      DEVELOPMENT STAGE ENTERPRISE)**

**STATEMENT      OF STOCKHOLDERS’ EQUITY**

|                                                       |   |                              |         |        |   |                   |   | **Accumulated**                 |         |       |   |
|------------------------------------------------------------|--------|-----------------------------------|--------------|-------------|--------|------------------------|--------|---------------------------------|--------------|------------|--------|
|                                                       |   |                              |         |        |   |                   |   | **earnings**                    |         |       |   |
|                                                       |   |                              |         |        |   | **Additional**         |   | **during                  the** |         | **Total**  |   |
|                                                       |   | **Common                  Stock** |         | **paid-in** |   | **development**        |   | **stockholders'**               |         |
|                                                       |   | **Shares                  (1)**   |         | **Amount**  |   | **capital**            |   | **stage**                       |         | **equity** |   |
|                                                       |   |                              |         |        |   |                   |   |                            |         |       |   |
|                                                       |   |                              |         |        |   |                   |   |                            |         |       |   |
| Common                  shares issued February 22,         |   |                              | 1,500,000    |        | $      | 150                    |   | $                               | 24,850       |       | $      | - |   | $ | 25,000 |   |
| 2005                  at $0.0167                           |   |                              |         |        |   |                   |   |                            |         |       |   |   |   |   |   |   |
|                                                       |   |                              |         |        |   |                   |   |                            |         |       |   |   |   |   |   |   |
| Sale                  of 6,000,000 units , net of          |   |                              |         |        |   |                   |   |                            |         |       |   |   |   |   |   |   |
| underwriters’                  discount and offering |   |                              |         |        |   |                   |   |                            |         |       |   |   |   |   |   |   |
| expenses                  (include 1,199,400 shares        |   |                              |         |        |   |                   |   |                            |         |       |   |   |   |   |   |   |
| subject                  to possible conversion )          |   |                              | 6,000,000    |        |   | 600                    |   |                            | 32,238,542   |       |   | - |   |   | 32,239,142 |   |
|                                                       |   |                              |         |        |   |                   |   |                            |         |       |   |   |   |   |   |   |
| Proceeds                  from issuance of option          |   |                              | -            |        |   | -                      |   |                            | 100          |       |   | - |   |   | 100 |   |
| compensation                                               |   |                              |         |        |   |                   |   |                            |         |       |   |   |   |   |   |   |
|                                                       |   |                              |         |        |   |                   |   |                            |         |       |   |   |   |   |   |   |
| Allotment                  of 318,000 units , net of       |   |                              |         |        |   |                   |   |                            |         |       |   |   |   |   |   |   |
| underwriters’                  discount and offering |   |                              |         |        |   |                   |   |                            |         |       |   |   |   |   |   |   |
| expenses                                                   |   |                              | 318,000      |        |   | 32                     |   |                            | 1,719,505    |       |   | - |   |   | 1,719,537 |   |
|                                                       |   |                              |         |        |   |                   |   |                            |         |       |   |   |   |   |   |   |
| Proceeds                  subject to possible conversion   |   |                              |         |        |   |                   |   |                            |         |       |   |   |   |   |   |   |
| of                  1,262,968 shares                       |   |                              | (1,262,968   | )           |   | (126                   | )      |                            | (6,587,650   | )          |   | - |   |   | (6,587,776 | ) |
|                                                       |   |                              |         |        |   |                   |   |                            |         |       |   |   |   |   |   |   |
| Net                  income                                |   |                              | -            |        |   | -                      |   |                            | -            |       |   | 184,518 |   |   | 184,518 |   |
|                                                       |   |                              |    |        |   |              |   |                            |    |       |   |    |   |   |    |   |
| Balance                  as of December 31, 2005           |   |                              | 6,555,032    |        |   | 656                    |   |                            | 27,395,347   |       |   | 184,518 |   | $ | 27,580,521 |   |
|                                                       |   |                              |         |        |   |                   |   |                            |         |       |   |   |   |   |   |   |
| Reimbursement                  of issuance costs           |   |                              | -            |        |   | -                      |   |                            | 10,000       |       |   | - |   |   | 10,000 |   |
|                                                       |   |                              |         |        |   |                   |   |                            |         |       |   |   |   |   |   |   |
| Net                  income                                |   |                              | -            |        |   | -                      |   |                            | -            |       |   | 35,515 |   |   | 35,515 |   |
|                                                       |   |                              |         |        |   |                   |   |                            |         |       |   |   |   |   |   |   |
| Balance                  as of June 30, 2006 (Unaudited)   |   |                              | 6,555,032    |        |   | 656                  $ |   | $                               | 27,405,347   |       | $      | 220,033 |   | $ | 27,626,036 |   |

| (1) | Share                  amounts have been restated to reflect a stock dividend of one share                  of                  common stock for each outstanding share of common stock affected                  on April                  14, 2005. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

**ISRAEL      TECHNOLOGY ACQUISITION CORP.**

**(A      DEVELOPMENT STAGE ENTERPRISE)**

**CONDENSED      STATEMENTS OF CASH FLOWS**

|                                                                      |   | **For                  the period of six months ended****June                  30,** |     | **For                  the period February 22, 2005 (inception) to****June                  30,** |   | **For                  the period February 22, 2005 (inception) to****June                  30,** |   |
|---------------------------------------------------------------------------|--------|--------------------------------------------------------------------------------------|----------|---------------------------------------------------------------------------------------------------|--------|---------------------------------------------------------------------------------------------------|--------|
|                                                                      |   | **2006**                                                                             |     | **2005**                                                                                          |   | **2006**                                                                                          |   |
|                                                                      |   | **Unaudited**                                                                        |     | **Unaudited**                                                                                     |   | **Unaudited**                                                                                     |   |
| Cash                  flows from operating activities:                    |   |                                                                                 |     |                                                                                              |   |                                                                                              |   |
| Net                  income ( loss )                                      |   | $                                                                                    | 35,515   |                                                                                              | $      | (2,600                                                                                            | )      | $ | 220,033 |   |
|                                                                      |   |                                                                                 |     |                                                                                              |   |                                                                                              |   |   |   |   |
| Decrease                  in prepaid expenses                             |   |                                                                                 | 30,000   |                                                                                              |   | -                                                                                                 |   |   | - |   |
| Decrease                  ( increase ) in accrued expenses                |   |                                                                                 | (74,195  | )                                                                                                 |   | 26,302                                                                                            |   |   | 29,726 |   |
| Accumulated                  interest on cash held in trust               |   |                                                                                 | (491,616 | )                                                                                                 |   | -                                                                                                 |   |   | (905,522 | ) |
| Net                  cash provided by ( used in ) operating activities    |   |                                                                                 | (500,296 | )                                                                                                 |   | 23,702                                                                                            |   |   | (655,763 | ) |
|                                                                      |   |                                                                                 |     |                                                                                              |   |                                                                                              |   |   |   |   |
| Cash                  flows from investing activities:                    |   |                                                                                 |     |                                                                                              |   |                                                                                              |   |   |   |   |
| Decrease                  in long term deposit                            |   |                                                                                 | 500,000  |                                                                                              |   | -                                                                                                 |   |   | - |   |
| Cash                  held in trust fund                                  |   |                                                                                 | -        |                                                                                              |   | -                                                                                                 |   |   | (32,955,360 | ) |
| Net                  cash provided by ( used in ) in investing activities |   |                                                                                 | 500,000  |                                                                                              |   | -                                                                                                 |   |   | (32,955,360 | ) |
|                                                                      |   |                                                                                 |     |                                                                                              |   |                                                                                              |   |   |   |   |
| Cash                  flows from financing activities:                    |   |                                                                                 |     |                                                                                              |   |                                                                                              |   |   |   |   |
| Gross                  proceeds from issuance of common stock             |   |                                                                                 |     |                                                                                              |   | -                                                                                                 |   |   | 37,908,056 |   |
| Proceeds                  from notes payable, stockholders                |   |                                                                                 |     |                                                                                              |   | 83,000                                                                                            |   |   | 83,000 |   |
| Payment                  of notes payables, stockholders                  |   |                                                                                 |     |                                                                                              |   | -                                                                                                 |   |   | (83,000 | ) |
| Proceeds                  from issuance of shares of common stock         |   |                                                                                 |     |                                                                                              |   | 25,000                                                                                            |   |   | 25,000 |   |
| Proceeds                  from issuance of option                         |   |                                                                                 |     |                                                                                              |   | -                                                                                                 |   |   | 100 |   |
| Reimbursement                  of issuance costs                          |   |                                                                                 | 10,000   |                                                                                              |   | -                                                                                                 |   |   | 10,000 |   |
| Payment                  of deferred offering costs                       |   |                                                                                 | -        |                                                                                              |   | (130,130                                                                                          | )      |   | (3,949,377 | ) |
| Net                  cash provided by ( used in ) financing activities    |   |                                                                                 | 10,000   |                                                                                              |   | )22,130                                                                                           | )      |   | 33,993,779 |   |
|                                                                      |   |                                                                                 |     |                                                                                              |   |                                                                                              |   |   |   |   |
|                                                                      |   |                                                                                 |     |                                                                                              |   |                                                                                              |   |   |   |   |
| Net                  change in cash and cash equivalents                  |   |                                                                                 | 9,704    |                                                                                              |   | 1,572                                                                                             |   |   | 382,656 |   |
| Cash                  and cash equivalents at the beginning               |   |                                                                                 |     |                                                                                              |   |                                                                                              |   |   |   |   |
| of                  the period                                            |   |                                                                                 | 372,952  |                                                                                              |   | -                                                                                                 |   |   | - |   |
| Cash                  and cash equivalents at the end                     |   |                                                                                 |     |                                                                                              |   |                                                                                              |   |   |   |   |
| of                  the period                                            |   | $                                                                                    | 382,656  |                                                                                              | $      | 1,572                                                                                             |   | $ | 382,656 |   |

----

| **1.  ** | **BASIS                OF PRESENTATION** |
|--------------------|------------------------------------------|

| **2.  ** | **ORGANIZATION                AND BUSINESS OPERATIONS** |
|--------------------|---------------------------------------------------------|

----

| **2.  ** | **COMMITMENTS** |
|--------------------|-----------------|

----

| **3.  ** | **NOTES                PAYABLE, STOCKHOLDER** |
|--------------------|-----------------------------------------------|

| **4.  ** | **COMMON                STOCK** |
|--------------------|---------------------------------|

| **5.  ** | **INITIAL                PUBLIC OFFERING** |
|--------------------|--------------------------------------------|

----

**.      **

| **6.  ** | **PROPOSED                BUSINESS COMBINATION** |
|--------------------|--------------------------------------------------|

----

**ITEM      2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF      OPERATION**

**Forward      Looking Statements**

**Overview**

**Recent      Development**

----

**Results      of Operations**

**Financial        Condition and Liquidity**

----

**ITEM      3. CONTROLS AND PROCEDURES.**

----

**PART      II. **

**OTHER      INFORMATION**

**ITEM      2: UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF      PROCEEDS**

**ITEM      6: EXHIBITS**

----

**SIGNATURES**

|                                        |                                                           |                                 |
|---------------------------------------------|----------------------------------------------------------------|--------------------------------------|
|                                        | **ISRAEL              TECHNOLOGY ACQUISITION CORP.**           |
|                                   |                                                      |                            |
| Dated:              November 14, 2006  | By:                                                  | /s/ Israel              Frieder |
|                                        | Israel              Frieder                                    |
|                                        | Chairman              of the Board and Chief Executive Officer |

|         |                                       |                             |
|--------------|--------------------------------------------|----------------------------------|
|    |                                  |                        |
|         | By:                              | /s/ Glen              Shear |
|         | Glen              Shear                    |
|         | Chief              Financial Officer  |

----