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Exhibit 4.16

# ASSET PURCHASE
AGREEMENT

THIS
ASSET PURCHASE AGREEMENT is dated as of 26 day of October, 2005 by and among Qualmax,
Inc., an Oregon corporation, having its address at 340 West Fifth Avenue, Eugene, Oregon,
97401 (the Buyer), BOScom Ltd., an Israeli company, having its address
at Beit Rabin, Teradyon Industrial Park, Misgav 20179 (BOScom) and
B.O.S. Better Online Solutions Ltd., an Israeli company, having its address at Beit Rabin,
Teradyon Industrial Park, Misgav 20179, Israel (BOS). BOScom and BOS
shall be referred to, collectively, as Seller. Following closing of the
Bench Transaction Agreement (as defined below), references to the Buyer herein shall be
deemed to be to the merged company created by the Bench Transaction Agreement.

WHEREAS,
Seller is engaged, among other things in the business of corporate communication solutions
(the Business); and

WHEREAS,
the Seller wishes to sell to Buyer and Buyer wishes to purchase from Seller all of
Sellers assets and rights, tangible and intangible, relating to, or used in
connection with, the Business, all on the terms and conditions, and for the consideration,
set forth herein.

NOW,
THEREFORE, in consideration of the mutual promises and agreements set forth herein, the
Buyer and the Seller agree as follows:

|1. | PURCHASE
AND SALE.
|-- | ------------------

| | 1.1. | Acquired
Assets. Subject to the terms and conditions set forth in this
               Agreement, at the Closing referred to in Section 4 hereof,
Seller                shall sell, assign, transfer and deliver to the Buyer (or, at Buyers
               request delivered to Seller in writing no later than 10 business days
prior to                the Closing, to a wholly owned Israeli subsidiary of Buyer) and
the Buyer shall                purchase, acquire and take assignment and delivery of, all
of the assets and                rights of Seller relating to, or used in connection
with, the Business (all of                which assets and rights are hereinafter
referred to collectively as the                Acquired Assets), as
set forth in Exhibit                A attached hereto.
| | ---- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 1.2. | (a) | Seller represents and warrants to Buyer that, upon Buyers purchase of
               the Acquired Assets in accordance with this Agreement, Buyer will take the
               Acquired Assets free and clear of all encumbrances or rights and claims of
any                third party, except for: (i) the Office of the Chief Scientist of the
Israeli                Ministry of Trade, Industry and Labor (the OCS),
and (ii) the                Investment Center of the Israeli Ministry of Trade, Industry
and Labor (the                Investment Center), in each case as set
forth on Schedule 1.2(i). The amounts paid to date and the amounts
               remaining outstanding as royalties by Seller to the OCS are set forth on
Schedule 1.2(i).
| | ---- | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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| | (b) | On
the date hereof, Buyer shall execute and deliver to Seller for filing with
               the OCS (1) a Transfer of Rights and Obligations Agreement with
the                OCS, in the form attached as Schedule 1.2(ii)               hereto,
pursuant to which Buyer shall fully assume the payment to the OCS of
               royalties under OCS programs related to the Acquired Assets (the
               Transfer of Rights Form); and (2) an undertaking
towards the                OCS in the OCS standard form attached hereto as Schedule
               1.2(iii), pursuant to which Buyer undertakes to observe
               and comply with provisions of Israeli law relating to the transfer of
               intellectual property (the Undertaking Form). Buyer
               acknowledges that execution of the Undertaking Form is a condition to the
               OCSs consent to the transactions contemplated herein.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 1.3. | Any
responsibility or liability whatsoever for Sellers debts, warranties,
               guaranties, obligations to third parties, or other liabilities, contingent
or                otherwise, pertaining to the Acquired Assets, including without
limitation, any                liabilities related to the Hired Personnel (as defined
below), to the extent                they relate to the period up to the Closing Date,
shall be borne by Seller                alone.
| | ---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 1.4. | The
parties shall conduct an accounting with respect to: (i) any payments due to
               the Seller and received by Buyer following the Closing Date, or (ii) any
               payments received by Seller with respect to services or products to be
delivered                by Buyer following the Closing Date, all as set forth in Schedule
               1.4 hereto. The relevant calculation shall be performed
               by the parties until the Closing Date.
| | ---- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 1.5. | Prior
to or on the Closing Date, the parties shall enter into a transitional
               outsourcing agreement, substantially in the form attached as Exhibit
               B hereto (the OutsourcingAgreement),
               pursuant to which Seller shall provide Buyer, for a period set forth in
the                Outsourcing Agreement, with such services required by Buyer for the
continuous                operation of the Acquired Assets, including, without
limitation, accounting and                production services that relate to the Acquired
Assets. In consideration for any                such services after the first three
months thereof, Seller shall be entitled to                the service fees as set forth
in the Outsourcing Agreement.
| | ---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|2. | EMPLOYEES
|-- | ---------

| | 2.1. | A
list (the Employee List) setting forth the name of each
               employee of Seller relating to the Acquired Assets and the Business (the
               Employees) and the terms of his or her employment or
               engagement, including commencement date, compensation, social benefits,
bonus or                commission entitlement etc., has been provided to Buyer prior to
date hereof.                Seller represents and warrants that the Employee List is true
and complete in                all material respects and covenants to update the Employee
List if necessary in                order to ensure that it is true and complete in all
material respects                immediately prior to the Closing.
| | ---- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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| | 2.2. | Promptly
following the signing of this Agreement, Buyer shall provide Seller                with a
list specifying the Employees whom it is interested in employing or
               retaining as consultants (at Buyers sole discretion). Of such list,
those                employees and consultants who are interested in being retained by
Buyer and have                accepted its offer for employment or consulting engagement,
are referred to                herein as the Hired Personnel.
| | ---- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 2.3. | Seller
undertakes to retain all Hired Personnel until the Closing Date, on which
               date such Hired Personnel shall be terminated by Seller and begin to be
employed                or retained by Buyer on terms substantially similar to the terms
enjoyed by such                persons prior to the Closing Date.
| | ---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 2.4. | Seller
shall be liable for and shall pay to the Hired Personnel, on or before                the
Closing Date, any and all payments and social benefits due to them with
               respect to the period up to the Closing Date and their termination of
employment                or engagement (including, without limitation, payment of salary
or consultancy                fees, severance pay, any advance notice payment (if
applicable under the law)                and redemption of unused vacation days). Seller
shall fully indemnify and hold                Buyer harmless, upon Buyers first
demand, from and against any demand or                claim brought against Buyer by any
Employee (including the Hired Personnel) with                respect to its engagement by
Seller prior to the Closing Date.
| | ---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 2.5. | As
of the Closing Date, Buyer shall be exclusively responsible for any and all
               payments to the Hired Personnel and shall fully indemnify and hold Seller
               harmless, upon Sellers first demand, from and against any demand or
claim                brought against Seller by any member of the Hired Personnel with
respect to its                employment following the Closing Date.
| | ---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 2.6. | Seller
shall notify the Hired Personnel of the transfer of the Acquired Assets                to
the Buyer, and cooperate with Buyer in all respects relating to any actions
               to be taken pursuant to this Section 2 and in achieving the hiring or
               engagement of the Hired Personnel by Buyer. Seller will not take any
action that                is intended to interfere with Buyers efforts to retain
any of the Hired                Personnel.
| | ---- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|3. | CONSIDERATION.
|-- | --------------

| | 3.1. | In
consideration for Acquired Assets, Buyer shall pay and Seller agrees to
               accept the following consideration (collectively, the Purchase
               Price), which shall be paid to Seller as follows:
| | ---- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 3.1.1. | Share
Consideration. Buyer shall issue Seller 4,000,000                shares of
Common Stock, par value $0.001 each, of Bench Group, Inc. post the                Bench
Transaction Agreement, as defined below (the Buyer                Stock),
such payment by way of issuance of shares of Buyer Stock to                Seller shall
be referred to herein as the ShareConsideration.
| | ------ | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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| | In
this Agreement, the Bench Transaction Agreement means the Agreement
and Plan of Share Exchange between Buyer and Bench Group, Inc., dated June 24, 2005, as
amended on July 15, 2005 and which is attached hereto as Exhibit C.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 3.1.2. | Royalty
Fee.The parties agree that in addition to the Share           Consideration,
Buyer shall pay Seller a royalty initially equal to four percent           (4%) of the
gross sales (as defined by US GAAP) received by Buyer on any sales           generated by
the Royalty Base Business (as defined herein), commencing upon the           Closing, up
to the total amount of US$800,000 (the Royalty           Consideration).
The Royalty Consideration shall be paid to Seller           within forty-five (45) days
of the end of the fiscal quarter in which earned.           Together with each payment of
Royalty Consideration, Seller shall deliver to           Buyer un-audited details of the
sales generated during the past quarter. Within           ninety (90) days of the end of
any fiscal year, Buyer shall deliver to Seller an           annual accounting of sales as
reviewed by the Buyers auditors. Any           adjustment to the Royalty
Consideration for the past year shall be made in the           following quarterly
payment. For purposes of this Section 3          (Consideration),
the Royalty Base Business          will refer to the Business sold by
Seller to Buyer hereunder (as defined at the           preamble to this Agreement) and
any other Voice Over Internet Protocol           manufacturing business conducted by
Buyer at the relevant time, taken together.           To the extent Value Added Tax (VAT)
is imposed in connection           with the Share Consideration and/or the Royalty
Consideration payable by Buyer           pursuant to this Agreement, such VAT shall be
solely born and paid by Buyer.
| | ------ | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 3.1.3. | Adjustment
to Royalty Rate. Notwithstanding anything to the contrary in Section 3.1.2, if
the aggregate gross sales (defined by US GAAP)           received by Buyer on sales
generated by the Royalty Base Business for the period           ending on the third (3rd)
anniversary of the Closing is less than           Twenty Million Dollars ($20,000,000),
then: (i) the royalty rate for such period           shall be retroactively adjusted to
equal the Modified Royalty Rate (as defined           below); and (ii) Buyer shall,
within ninety (90) days of such anniversary, pay           to Seller any difference
between the amount of Royalty Consideration actually           paid to Seller during such
period and the amount of Royalty Consideration earned           using the Modified
Royalty Rate. The ModifiedRoyalty           Rate shall be
equal to the quotient of (a) Eight Hundred Thousand           Dollars ($800,000) divided
by (b) the aggregate gross sales (defined by US GAAP)           received by Buyer on
sales generated by the Royalty Base Business for the period           ending on the third
(3rd) anniversary of the Closing.
| | ------ | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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| | 3.1.4. | Stock
In Lieu of Cash. Buyer may, separately for each           quarterly
payment of Royalty Consideration, in its sole discretion, offer Seller           the
option (the ShareRoyalty Option) to elect that           all
or part of the Royalty Consideration be paid to Seller in shares of stock of
          Buyer (the Additional Buyer Stock) to be issued to Seller in
          lieu of cash royalty payments. If Buyer elects to offer Seller any Share
Royalty           Option hereunder, it shall give Seller written notice of same (Share
          Royalty Notice), which shall also state the per share value of the
          Additional Buyer Stock determined as provided below, at least twenty (20) days
          prior to the next scheduled royalty payment according to the provisions of Section
3.1.2 above. Upon receipt of any Share Royalty Notice,           Seller may elect to
exercise its Share Royalty Option by notifying Buyer of the           same at least five
(5) days prior to the next scheduled royalty payment           according to the
provisions of Section 3.1.2 above. For this           purpose the value of the
Additional Buyer Stock shall be based on the average           last sale price of Buyer
Stock for the twenty (20) trading days immediately           prior to the date of the
relevant Share Royalty Notice. In the event that Seller           exercises any Share
Royalty Option under this Section 3.1.4,           Seller shall have such
registration rights with respect to the Additional Buyer           Stock as described in
Section 7 below.
| | ------ | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 3.2. | Holdback
Shares
| | ---- | ---------------

| | 3.2.1. | Out
of the Share Consideration, 1,000,000 shares of Buyer Stock (the           Holdback
Shares) shall be delivered to Kramer Levin Naftalis           & Frankel LLP
(the Escrow Agent) pursuant to the terms           and conditions of
the Escrow Agreement attached as Exhibit           D hereto (the
Escrow Agreement). For as long           as the Holdback Shares remain
in Escrow, the Escrow Agent shall vote, execute           written instruments and/or
exercise any other rights of holders in connection           with the Holdback Shares
(other than any rights to sell, transfer or otherwise           dispose of any interest
therein) pursuant to the written instructions of the           Seller, all in accordance
with the provisions of the Escrow Agreement.
| | ------ | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 3.2.2. | All
dividends, bonus shares, options or other distributions (collectively,           Distributions)
to shareholders as may be declared by Buyer in           respect of the Holdback Shares
shall be paid, issued or distributed to the           Escrow Agent, who shall hold them
until such time that the Holdback Shares are           released from Escrow as herein
provided (all such Distributions shall be treated           hereunder identically to the
Holdback Shares to which they are attributable).
| | ------ | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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| | 3.2.3. | In
the event that during the full four (4) consecutive quarters following the
          Closing Date (the Escrow Period) the financial statements of
          Buyer reflect gross sales, as defined according to US GAAP, related to the
          Business, as reflected in Buyers consolidated financial statements and
          without including revenues from Qualmaxs other businesses (the
          Business  Revenues), equal, in aggregate, to Six Million US
          Dollars (US$ 6,000,000) or more (a Triggering Event), then
          the Holdback Shares (including any Distributions related thereto) shall be
          transferred by the Escrow Agent to the Seller in accordance with the provisions
          of the Escrow Agreement. In the event that Business Revenues during the Escrow
          Period amount to less than US$4,000,000 the Buyer shall be entitled to receive
          all of the Holdback Shares from the Escrow Agent. For every $100,000 deficit in
          Business Revenues below $6,000,000, 50,000 Holdback Shares shall be transferred
          by the Escrow Agent to the Buyer and the remainder of the Holdback Shares shall
          be transferred by the Escrow Agent to the Seller.
| | ------ | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 3.2.4. | Business
Operation. Following the Closing and until the end of the Escrow           Period,
Buyer shall operate the Business consistent with Sellers past           practices
and a reasonable business plan, and shall not take any action that           would
reasonably be expected to cause the non-occurrence of a Triggering Event.           Upon
any material breach by Buyer of the immediately preceding sentence (a Voiding
Action), Seller shall be entitled to have all of the           Holdback Shares
released and transferred to Seller by the Escrow Agent in           accordance with the
provisions of the Escrow Agreement.
| | ------ | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 3.2.5. | Reports.
During the Escrow Period, for so long as any royalty payments           are due hereunder
and for a period of six (6) months thereafter, Buyer shall           provide Seller with
quarterly reports certified by Buyers Chief Financial           Officer, covering
Buyers (and any Buyers subsidiary, as applicable)           activities with
respect to the Business for the respective quarter, including           financial
statements, new customers, status of all current customers, license           fees
received and such other information as is reasonably necessary to           determine:
(a) for so long as any royalty payments are due hereunder, the amount           of gross
sales (defined by US GAAP) received by Buyer on sales generated by the           Royalty
Base Business during such quarter; and (b) during the Escrow Period, the           amount
of Business Revenues generated during such quarter.
| | ------ | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 3.2.6. | Auditing
and Inspection Rights. During the Escrow Period and for a period           of six (6)
months thereafter, Seller shall be entitled to review and audit           Buyers
books and records with respect to the Business Revenues, provided           that such
audit shall be conducted by an independent auditor at Sellers           expense; provided,
however, that if such audit reveals that Buyer           had understated Business
Revenues (without subsequently correcting its           calculation thereof) by more than
ten percent (10%), then Buyer shall pay for           the reasonable expenses of such
audit. Seller shall be entitled to exercise its           audit rights under this Section
3.2.6 every six (6) months, upon           notice of seven (7) business days to
Buyer. Any audit pursuant to this Section 3.2.6 shall be conducted during Buyers
normal           business hours so as not to unreasonably interfere with Buyers
business           activities.
| | ------ | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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| | 3.3. | Legend.
The shares to be issued to Seller pursuant to this Section           3 shall bear
the following restrictive legend or similar legend           affixed thereto:
| | ---- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | THE
SECURITUES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED, OR UNDER ANY STATE SECURITIES OR BLUE SKY LAWS. THE SECURITIES
HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE SOLD OR TRANSFERRED FOR VALUE IN THE
ABSENCE OF AN EFFECTIVE REGISTRATION OF THEM UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, AND ANY APPLICABLE STATE SECURITIES LAWS OR AN OPINION OF COUNSEL THAT AN
EXEMPTION FROM SUCH REGISTRATION REQUIREMENTS IS AVAILABLE WITH RESPECT TO SUCH SALE OR
TRANSFER.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 3.4. | No
Dilution. Buyer shall neither effect, nor fix any record date with
               respect to any stock split, stock dividend, reverse stock split,
               recapitalization or similar change in Buyer Stock between the date of this
               Agreement and the Closing Date.
| | ---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|4. | CLOSING.
|-- | --------

| | 4.1. | Time
and Place. The closing of the transactions contemplated by this
Agreement (the Closing) shall occur no later than three (3)
business days after each of the closing conditions set forth in Sections
9and 10 hereto have been satisfied or waived in writing (the
Closing Date).
| | ---- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 4.2. | Transactions
at Closing. At the Closing, the following actions shall                occur, which
actions shall be deemed to take place simultaneously and no action                shall
be deemed to have been completed or any document delivered until all such
               actions have been completed and all required documents delivered:
| | ---- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (a) | The
Seller shall duly execute and deliver to the Buyer such certificates of
               title or other instruments of assignment and transfer with respect to the
               Acquired Assets as the Buyer may reasonably request and as may be
necessary to                vest in the Buyer good and marketable title to all of the
Acquired Assets;
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (b) | The
Seller shall provide the Buyer with true and correct copies of resolutions
               of the Sellers Board of Directors, authorizing the transactions
               contemplated under this Agreement;
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (c) | Buyer
shall provide the Seller with: (i) a validly executed share certificate
               covering the Share Consideration (other than the Holdback Shares), issued
in the                name of the Seller;
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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| | (d) | Buyer
shall provide the Escrow Agent with a validly executed share certificate
               covering the Holdback Shares, issued in the name of the Escrow Agent;
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (e) | Buyer
shall provide the Seller with true and correct copies of resolutions of
               Buyers Board of Directors approving the transaction contemplated
hereby,                the issuance of the Share Consideration (including the Holdback
Shares) and the                payment of the Royalty Consideration and the potential
issuance of Additional                Buyer Stock.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (f) | Buyer
shall provide the Seller with an opinion of Buyers counsel,
               addressed to Seller and dated as of the Closing date, substantially in the
form                attached hereto as Schedule 10.10.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|5. | REPRESENTATIONS
AND WARRANTIES OF THE SELLER.
|-- | ---------------------------------------------

| | Acknowledging
that the Buyer is relying on the representations and warranties set forth in this
Section 5, Seller jointly and severally hereby represent and warrant to the
Buyer as follows:
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 5.1. | Organization.
Each Seller is a company duly incorporated and validly                     existing under
the laws of the State of Israel, and has the corporate power and                     is
duly authorized, qualified, franchised, and licensed under all applicable
                    laws, regulations, ordinances, and orders of public authorities to
own all of                     its properties and assets and to carry on its business in
all material respects                     as it is now being conducted, and there is no
jurisdiction in which it is not                     qualified in which the character and
location of the assets owned by it or the                     nature of the business
transacted requires qualification, except where the                     failure to be so
qualified would not reasonably be expected to result in a                     Seller MAE.
| | ---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 5.2. | Authorization. The
execution and delivery of this Agreement and the                     consummation of the
transactions contemplated in this Agreement have been duly                     and
validly authorized by each Seller and no other corporate proceedings or
                    approvals on the part of any Seller are necessary to authorize this
Agreement or                     any such transactions, which approvals have not been
obtained on or prior to the                     Closing.
| | ---- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 5.3. | Enforceability.This Agreement has been duly                     and validly executed and
delivered by Seller and is a valid and legally binding                     obligation of
Seller enforceable against Seller in accordance with its terms.
| | ---- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 5.4. | Acquired
Assets. Seller is the owner of and has good and marketable title
                    to all of the Acquired Assets, free and clear of all encumbrances or
rights and                     claims of any third party (except for the OCS, to the
extent set forth on Schedules1.2(i) hereto) or restrictions
on                     transfer. To the best of Sellers knowledge: (i) no claims
were made or                     threatened in relation to the Acquired Assets; (ii) the
Acquired Assets do not                     breach or infringe on any third partys
rights; and (iii) the Acquired                     Assets are in operable condition and
repair. Except as set forth on Schedule 5.4, the Acquired Assets
constitute all of the                     assets that Seller currently uses in, or that
are necessary for the conduct of,                     the Business.
| | ---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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| | 5.5. | Non-Contravention.
Neither the execution and the delivery of this                     Agreement, the Escrow
Agreement or the Outsourcing Agreement, nor the                     consummation of the
transactions contemplated hereby and thereby, will (i)                     violate any
constitution, statute, regulation, rule, injunction, judgment,                     order,
decree, ruling, charge, or other restriction of any government,
                    governmental agency, or court, or any stock exchange or quotation
system, to                     which Seller is subject or any provision of the
certificate of incorporation,                     bylaws or analogous instruments of
Seller, (ii) conflict with, result in a                     breach of, constitute a
default under, result in the acceleration of, create in                     any party the
right to accelerate, terminate, modify, or cancel, or require any
                    notice under any agreement, contract, lease, license, instrument, or
other                     arrangement to which Seller is a party or by which it is bound
or to which any                     of its assets is subject, or, (iii) result in the
imposition of any lien or                     other encumbrance upon any of Sellers
assets (including, without                     limitation, the Acquired Assets), except
where the violation, conflict, breach,                     default, acceleration,
termination, modification, cancellation, failure to give                     notice, or
encumbrance would not reasonably be expected to have a material
                    adverse effect on the business, operations, properties, prospects, or
conditions                     of Seller, taken as a whole or solely with respect to the
Business, or on the                     ability of the parties to consummate the
transactions contemplated by this                     Agreement (a Seller MAE).
| | ---- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 5.6. | Governmental
Authorization. Seller has all licenses, franchises, permits,                     and
other government authorizations, that are legally required to enable it to
                    conduct its business operations in all material respects as conducted
on the                     date hereof. Except for (a) compliance with federal and state
securities or                     corporation laws, and (b) obtaining the approval of the
OCS and the Investment                     Center, as applicable, as provided in this
Agreement, no authorization,                     approval, consent, or order of, or
registration, declaration, or filing with,                     any court or other
governmental body, or any stock exchange or quotation system,                     is
required in connection with the execution and delivery by Seller of this
                    Agreement and the consummation by Seller of the transactions
contemplated                     hereby.
| | ---- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 5.7. | Compliance
With Laws and Regulations. Seller has complied with all
                    applicable statutes and regulations of any federal, state, or other
applicable                     governmental entity or agency thereof, and with all
applicable rules of any                     stock exchange or quotation system, except to
the extent that noncompliance                     would not reasonably be expected to
result in a Seller MAE.
| | ---- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 5.8. | Business
Books and Records.The business                     books
and records of Seller that have been provided to Buyer (including with
                    respect to the presentation of the Sellers inventory) are
accurate records                     of the information purported to be reflected
therein..
| | ---- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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| | 5.9. | Financial
Statements; Public Filings. Sellers audited balance sheet
                    at December 31, 2004 and the related financial statements for the
period then                     ending (including the notes thereto) included in its
Annual Report on Form 20-F                     filed on June 27, 2005 (the SellerAnnual Report) and                     Sellers un-audited balance
sheet at June 30, 2005 and the related                     un-audited financial
statements for the period then ending (including the notes                     thereto)
included in its Form 6-K filed on August 23, 2005 (collectively, the
                    SellerFinancial Statements) have been
prepared in                     accordance with United States generally accepted
accounting principles                     consistently applied, present fairly the
financial condition of Seller as of                     such date and the results of
operations of Seller for such period, are correct                     and complete, and
are consistent with the books and records of Seller. The                     Seller
Annual Report and all reports Seller has filed with the SEC thereafter,
                    when filed, were free of material errors and omissions, and as of the
date                     hereof and the Closing shall continue to be free of material
errors and                     omissions, except to the extent modified or superceded by
disclosures made in                     this Agreement, including the Schedules hereto.
| | ---- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 5.10. | Absence
of Certain Changes or Events. Except as set forth in Schedule 5.10,
in the Employee List referenced in                     Section 2.1 above, and/or in
filings made prior to October 9, 2005 under                     the Securities Exchange
Act of 1934, since June 30, 2005:
| | ----- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (a) | There
has not been any material adverse change, financial or otherwise, in the
               business, operations, properties, assets, or condition of Seller (whether
or not                covered by insurance) materially and adversely affecting the
business,                operations, properties, assets, or condition of Seller;
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (b) | Seller
has not (i) amended its Certificate of Incorporation or bylaws, or
               analogous instruments; (ii) declared or made, or agreed to declare or make
any                payment of dividends or distributions of any assets of any kind
whatsoever to                stockholders or purchased or redeemed, or agreed to purchase
or redeem, any of                its capital stock; (iii) waived any rights of value
which in the aggregate are                extraordinary or material with respect to the
Business; (iv) made any material                change in its method of management,
operation, or accounting with respect to the                Business; (v) entered into
any other material transactions with respect to the                Business; (vi) made
any accrual or arrangement for or payment of bonuses or                special
compensation of any kind or any severance or termination pay to any
               present or former officer or employee who is or was primarily involved in
the                Business, other than in the ordinary course of business; (vii)
increased the                rate of compensation payable or to become payable by it to
any of its officers                or directors or any of its employees primarily
involved in the Business, other                than in the ordinary course of business;
or (viii) made any increase in any                profit sharing, bonus, deferred
compensation, insurance, pension, retirement, or                other employee benefit
plan, payment, or arrangement, made to, for, or with its                officers,
directors, or employees who are or were involved in the Business,                other
than in the ordinary course of business;
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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| | (c) | Seller
has not (i) borrowed or agreed to borrow any funds or incurred, or become
               subject to, any material obligation or liability (absolute or contingent)
except                liabilities incurred in the ordinary course of business or which
could not                reasonably be expected to have a material adverse effect on the
Business; (ii)                sold or transferred, or agreed to sell or transfer, any of
the Acquired Assets,                or canceled, or agreed to cancel, any material debts
or claims with respect to                the Business; or (iii) made or permitted any
amendment or termination of any                material contract, agreement, or license
related to the Business to which it is                a party, other than in the ordinary
course of business; and
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (d) | Seller
has not become subject to any law or regulation which could reasonably be
               expected to have a Seller MAE.
| | --- | ------------------------------------------------------------------------------------------------------------------------------

| | 5.11. | Material
Contracts. Except as set forth on Schedule5.11, there
are no material contracts, agreements,                     franchises, license
agreements, or other commitments related to the Business to                     which
Seller is a party or by which it or any of its assets, products,
                    technology, or properties are bound other than the exhibits to the
Seller Annual                     Report.
| | ----- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 5.12. | Business
Conduct. Seller has conducted the Business and the related
                    Acquired Assets in a regular and ordinary course. Seller undertakes
that until                     the Closing Date, it will continue to conduct the Acquired
Assets and the                     Business in a consistent manner without material
change of policy or procedure                     and shall not act in any way that may
result in a Seller MAE.
| | ----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 5.13. | Employees.
The Seller has complied with all of its commitments and                     obligations
towards the Hired Personnel on or prior to the Closing Date.
| | ----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 5.14. | Offshore
Transaction. Seller is not a U.S. Person, as
                    such term is defined in Regulation S under the Securities Act of
1933, its                     principal address is outside the United States and it has
no present intention                     of becoming a resident of (or moving its
principal place of business to) the                     United States. Seller hereby
represents and warrants that each of the                     representations set forth in
Schedule5.14,                     which is incorporated
herein by reference, is true with respect to each Seller.
| | ----- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 5.15. | No
Litigation. Seller, with respect to the Acquired Assets, (i) is not
                    subject to any outstanding injunction, judgment, order, decree,
ruling, or                     charge and (ii) is not a party and, to the knowledge of
Seller, is not                     threatened to be made a party to any action, suit,
proceeding, hearing, or                     investigation of, in, or before any court or
quasi judicial or administrative                     agency of any federal, state, local,
or foreign jurisdiction or before any                     arbitrator. Seller has no
reason to believe that any such action, suit,                     proceeding, hearing, or
investigation may be brought or threatened against                     Seller.
| | ----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 5.16. | Brokers.
Except as set forth on Schedule                     5.16 hereto,
Seller has not entered into any contract                     with any person, firm or
other entity that would obligate Seller or Buyer to pay                     any
commission, brokerage or finders fee in connection with the
                    transactions contemplated herein.
| | ----- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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| | 5.17. | No
Other Representations or Warranties of Buyer. Seller acknowledges that
                    Buyer is making no, and represents that Seller is not relying on any,
                    representations or warranties (either express or implied) other than
those                     expressly made pursuant to this Agreement.
| | ----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 5.18. | Information.
The information concerning Seller set forth in this                     Agreement and the
Sellers schedulesare and will be accurate in all
                    material respects and does not contain any untrue statement of a
material fact                     or omit to state a material fact required to make the
statements made, in light                     of the circumstances under which they were
made, not misleading as of the date                     hereof and as of the Closing
Date.
| | ----- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|6. | REPRESENTATIONS
AND WARRANTIES OF THE BUYER.
|-- | --------------------------------------------

| | Acknowledging
that the Seller is relying on the representations and warranties set forth in this
Section 6, Buyer hereby represent and warrant to the Seller as follows:
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 6.1. | Organization.
Buyer is a corporation duly organized, validly existing,                     and in good
standing under the laws of the State of Delaware, and has the
                    corporate power and is duly authorized, qualified, franchised, and
licensed                     under all applicable laws, regulations, ordinances, and
orders of public                     authorities to own all of its properties and assets
and to carry on its business                     in all material respects as it is now
being conducted, and there is no                     jurisdiction in which it is not
qualified in which the character and location of                     the assets owned by
it or the nature of the business transacted by it requires
                    qualification, except where the failure to be so qualified would not
reasonably                     be expected to have a material adverse effect on Buyer.
| | ---- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 6.2. | Authorization.
The execution and delivery of this Agreement does not, and                     the
consummation of the transactions contemplated hereby will not, violate any
                    provision of Buyers organizational documents. The execution and
delivery                     of this Agreement and the consummation of the transactions
contemplated in this                     Agreement have been duly and validly authorized
by Buyer and no other corporate                     proceedings or approvals on the part
of Buyer are necessary to authorize this                     Agreement or any such
transaction, which approval have not been obtained on or                     prior to the
Closing. Buyer has provided Seller, prior to the Closing, with
                    complete and correct copies of the organizational documents of Buyer
in effect                     as to date of this Agreement.
| | ---- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 6.3. | Enforceability.This Agreement has been duly                     and validly executed and
delivered by Buyer and is a valid and legally binding                     obligation of
Buyer enforceable against Buyer in accordance with its terms.
| | ---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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| | 6.4. | Non-Contravention.
Neither the execution and the delivery of this                     Agreement, the Escrow
Agreement or the Outsourcing Agreement, nor the                     consummation of the
transactions contemplated hereby and thereby, will (i)                     violate any
constitution, statute, regulation, rule, injunction, judgment,                     order,
decree, ruling, charge, or other restriction of any government,
                    governmental agency, or court, or any stock exchange or quotation
system, to                     which Buyer is subject or any provision of the certificate
of incorporation,                     bylaws or analogous instruments of Buyer, (ii)
conflict with, result in a breach                     of, constitute a default under,
result in the acceleration of, create in any                     party the right to
accelerate, terminate, modify, or cancel, or require any                     notice under
any agreement, contract, lease, license, instrument, or other
                    arrangement to which Buyer is a party or by which it is bound or to
which any of                     its assets is subject, or, (iii) result in the
imposition of any lien or other                     encumbrance upon any of Buyers
assets, except where the violation,                     conflict, breach, default,
acceleration, termination, modification,                     cancellation, failure to
give notice, or encumbrance would not reasonably be                     expected to have
a material adverse effect on the business, operations,                     properties,
prospects, or conditions of Buyer, taken as a whole or solely with
                    respect to the Business, or on the ability of the parties to
consummate the                     transactions contemplated by this Agreement (a Buyer
MAE).
| | ---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 6.5. | Capitalization.
Immediately prior to the Closing, Buyers authorized                     share
capital shall consist of: (i) no more than 40,000,000 shares of Buyer
                    Stock, of which no more than 25,000,000 shares will have been issued
and                     outstanding, or will be issuable upon exercise of options and
warrants that are                     issued outstanding, immediately prior to Closing;
and (ii) 100 shares of                     Preferred Stock, of which no shares are issued
and outstanding. Schedule                     6.5 hereto constitutes
the share capitalization table of                     Buyer on a fully diluted basis, as
of the date hereof. All presently issued and                     outstanding shares are
legally issued, fully paid, and non-assessable and not                     issued in
violation of the pre-emptive or other rights of any person. The Share
                    Consideration (including the Holdback Shares) will be legally issued,
fully paid                     and non-assessable and shall not be issued in violation of
the pre-emptive or                     other rights of any other person.
| | ---- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 6.6. | Subsidiaries.
Buyer owns the following wholly owned subsidiaries:                     Qualmax, Inc.,
iNode Corporation, Qualmax Professional Services LLC, Rent IT                     Telecom
LLC, IP Gear, Inc. and, as of the Closing, will own a wholly-owned
                    Israeli subsidiary (the Israeli  Subsidiary).
Buyer                     represents and undertakes that the Israeli Subsidiary shall
have been                     established prior to the Closing to hold the Acquired
Assets and to conduct                     Business, and that it shall be free and clear
of any and all liabilities and                     encumbrances whatsoever. Buyer further
undertakes, as soon as practicable                     following the establishment of the
Israeli Subsidiary, to cause same to execute                     a confirmation to the
effect that any and all continuing obligations and                     undertakings
contained in this Agreement and binding the Buyer (including                     without
limitation pursuant to Section 8 hereof), shall be, to the                     extent
applicable, binding on and observed by the Israeli Subsidiary.
| | ---- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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| | 6.7. | Financial
Statements.
| | ---- | ---------------------

| | (a) | On
or before the Closing, Buyer shall have delivered to Seller: (i) audited
               financial statements and notes thereto covering the fiscal year ended
December                31, 2004, including income statements, balance sheets and
statements of cash                flow and stockholders equity and including an audit
report issued by                Buyers certified public accountants (the Buyer
Audited Financial                Statements); and (ii) un-audited financial
statements and notes                thereto covering the six (6) months ended June 30,
2005, including reviewed                income statements, balance sheets and statements
of cash flow and stockholders                equity (the Buyer Unaudited
FinancialStatements).                The Buyer Audited Financial
Statements and the Buyer Unaudited Financial                Statements are hereinafter
collectively referred to as the Buyer Financial                Statements.
The Buyer Financial Statements are attached as Schedule6.7(a) hereto.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (b) | The
Buyer Audited Financial Statements have been prepared in conformity with
               U.S. generally accepted accounting principles consistently applied and
shall be                the subject of an opinion of Buyers certified public
accountants. The                Buyer Unaudited Financial Statements: (i) have been
prepared in conformity with                U.S. generally accepted accounting principles
consistently applied; and (ii)                shall be in approximate Form 10-Q format.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (c) | Buyer
has no liabilities with respect to the payment of any federal, state,
               county, local, or other taxes (including any deficiencies, interest, or
               penalties), except for taxes accrued but not yet due and payable, for
which                Buyer may be liable in its own right, or as a transferee of the
assets of or as                a successor to, any other corporation or entity.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (d) | Buyer
has filed all federal, state and local income tax returns required to be
               filed by it from inception to the date hereof All such returns are
complete and                accurate in all material respects.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (e) | The
books and records, financial and otherwise, of Buyer are in all material
               respects accurate records of the information purported to be reflected
therein                and have been maintained in accordance with good business and
accounting                practices.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (f) | No
deficiency for any taxes has been proposed, asserted or assessed against
               Buyer. There has been no tax audit, nor has there been any notice to Buyer
by                any taxing authority regarding any such tax audit, or, to the knowledge
of                Buyer, is any such tax audit threatened with regard to any taxes or
Buyer tax                returns. Buyer does not expect the assessment of any additional
taxes of Buyer                for any period prior to the date hereof and has no
knowledge of any unresolved                questions concerning the liability for taxes
of Buyer.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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| | (g) | Buyer
has good and marketable title to its assets and has no material contingent
               liabilities, direct or indirect, matured or un-matured with respect
thereof.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 6.8. | Information.
The information concerning Buyer set forth in this Agreement                     and the
Buyers schedulesare and will be accurate in all material
                    respects and does not contain any untrue statement of a material fact
or omit to                     state a material fact required to make the statements
made, in light of the                     circumstances under which they were made, not
misleading as of the date hereof                     and as of the Closing Date.
| | ---- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 6.9. | Options
or Warrants. Except as set forth in Schedule                     6.9,
there are no existing options, warrants, calls, or                     commitments of any
character relating to authorized and unissued stock of Buyer.
| | ---- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 6.10. | Absence
of Certain Changes or Events. Except as set forth in Schedule 6.10,
since the date of the Buyer                     Financial Statements:
| | ----- | -------------------------------------------------------------------------------------------------------------------------------------------------

| | (a) | There
has not been (i) any material adverse change, financial or otherwise, in
               the business, operations, properties, assets, or condition of Buyer
(whether or                not covered by insurance) materially and adversely affecting
the business,                operations, properties, assets, or condition of Buyer;
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (b) | Buyer
has not (i) amended its Certificate of Incorporation or bylaws; (ii)
               declared or made, or agreed to declare or make any payment of dividends or
               distributions of any assets of any kind whatsoever to stockholders or
purchased                or redeemed, or agreed to purchase or redeem, any of its capital
stock; (iii)                waived any rights of value which in the aggregate are
extraordinary or material                considering the business of Buyer; (iv) made any
material change in its method                of management, operation, or accounting; (v)
entered into any other material                transactions; (vi) made any accrual or
arrangement for or payment of bonuses or                special compensation of any kind
or any severance or termination pay to any                present or former officer or
employee; (vii) increased the rate of compensation                payable or to become
payable by it to any of its officers or directors or any of                its employees;
or (viii) made any increase in any profit sharing, bonus,                deferred
compensation, insurance, pension, retirement, or other employee benefit
               plan, payment, or arrangement, made to, for, or with its officers,
directors, or                employees;
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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| | (c) | Buyer
has not (i) granted or agreed to grant any options, warrants, or other
               rights for its stocks, bonds, or other corporate securities calling for
the                issuance thereof; (ii) borrowed or agreed to borrow any funds or
incurred, or                become subject to, any material obligation or liability
(absolute or contingent)                except liabilities incurred in the ordinary
course of business; (iii) paid or                agreed to pay any material obligation or
liability (absolute or contingent)                other than current liabilities
reflected in or shown on the most recent Buyer                consolidated balance sheet
and current liabilities incurred since that date in                the ordinary course of
business; (iv) sold or transferred, or agreed to sell or                transfer, any of
its assets, property, or rights (except assets, property, or                rights not
used or useful in its business which, in the aggregate have a value                of
less than $50,000), or canceled, or agreed to cancel, any debts or claims
               (except debts or claims which in the aggregate are of a value of less than
               $50,000); (v) made or permitted any amendment or termination of any
contract,                agreement, or license to which it is a party, other than in the
ordinary course                of business, if such amendment or termination is material,
considering the                business of Buyer; or (vi) issued, delivered, or agreed to
issue or deliver any                stock, bonds, or other corporate securities including
debentures (whether                authorized and un-issued or held as treasury stock),
except in connection with                this Agreement; and
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (d) | Buyer
has not become subject to any law or regulation which could reasonably be
               expected to have a Buyer MAE.
| | --- | ----------------------------------------------------------------------------------------------------------------------------

| | 6.11. | Title
and Related Matters. Buyer has good and marketable title to all of
                    its properties, interest in properties, and assets, real and
personal, which are                     reflected in the Buyer Financial Statements or
acquired after the date of such                     Buyer Financial Statements (except
properties, interest in properties, and                     assets sold or otherwise
disposed of since such date in the ordinary course of                     business), free
and clear of all liens, pledges, charges, or encumbrances                     except:
| | ----- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (a) | statutory
liens or claims not yet delinquent;
| | --- | ---------------------------------------------

| | (b) | such
imperfections of title and easements as would not reasonably be expected to
               have a Buyer MAE; and
| | --- | ---------------------------------------------------------------------------------------------------------------------

| | (c) | as
described in Schedule 6.11 attached hereto.
| | --- | ----------------------------------------------

| | 6.12. | Litigation
and Proceedings. There are no actions, suits, or proceedings
                    pending or, to the knowledge of Buyer, threatened by or against or
affecting                     Buyer, or its properties, at law or in equity, before any
court or other                     governmental agency or instrumentality, domestic or
foreign, or before any                     arbitrator of any kind.
| | ----- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 6.13. | Contracts.
Schedule6.13 sets forth a                     list of all
material contracts, agreements, franchises, license agreements, or
                    other commitments to which Buyer is a party or by which it or any of
its assets,                     products, technology, or properties are bound,
specifically including any such                     contracts, agreement or arrangements
referred to in Section 6.13                    hereof.
| | ----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 6.14. | Governmental
Authorizations. Buyer has all licenses, franchises, permits,                     and
other government authorizations, that are legally required to enable it to
                    conduct its business operations in all material respects as conducted
on the                     date hereof. Except for compliance with federal and state
securities or                     corporation laws, as hereinafter provided, no
authorization, approval, consent,                     or order of, or registration,
declaration, or filing with, any court or other                     governmental body, or
any stock exchange or quotation system, is required in                     connection
with the execution and delivery by Buyer of this Agreement and the
                    consummation by Buyer of the transactions contemplated hereby.
| | ----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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| | 6.15. | Compliance
With Laws and Regulations. Buyer has complied with all                     applicable
statutes and regulations of any federal, state, or other applicable
                    governmental entity or agency thereof, and with all applicable rules
of any                     stock exchange or quotation system, except to the extent that
noncompliance                     would not reasonably be expected to result in a Buyer
MAE.
| | ----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 6.16. | Insurance.
| | ----- | ----------

| | (a) | Schedule
6.16 hereto lists all of the insurance                     policies
currently maintained by the Buyer (the Insurance                     Policies).
All the Insurance Policies are in full force and effect,                     all premiums
due and payable thereunder have been paid, and no notice of
                    cancellation or termination has been received with respect to any
such policy.                     The Insurance Policies are valid, outstanding and
enforceable in accordance with                     their terms and will remain in full
force and effect through the Closing.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (b) | Buyer
believes that the coverage provided by the Insurance Policies is
                    reasonable and appropriate for a company in Buyers position.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------

| | (c) | There
are currently no claims pending under any Insurance Policies. There is no
                    threatened termination of any such Insurance Policies. The Buyer has
not been                     refused any insurance with respect to its assets or
operations, nor has its                     coverage been limited by any insurance
carrier to which it has applied for any                     such insurance or with which
it carried insurance since its incorporation.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 6.17. | Continuity
of Business Enterprises. Buyer has no commitment or present
                    intention to liquidate Buyer or sell or otherwise dispose of a
material portion                     of its business or assets (other than sale of
products in the ordinary course of                     business) following the
consummation of the transactions contemplated hereby.
| | ----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 6.18. | Brokers.
Except as set forth on the Schedule                     6.18 hereto,
Buyer has not entered into any contract with                     any person, firm or
other entity that would obligate Seller or Buyer to pay any
                    commission, brokerage or finders fee in connection with the
transactions                     contemplated herein.
| | ----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 6.19. | No
Other Representations or Warranties of Seller. Buyer acknowledges that
                    Seller is making no, and represents that Buyer is not relying on any,
                    representations or warranties (either express or implied) other than
those                     expressly made pursuant to this Agreement.
| | ----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 6.20. | Buyer
shall cause the Buyers schedules attached hereto and the instruments
                    and data delivered to Seller hereunder to be updated after the date
hereof up to                     and including the Closing Date.
| | ----- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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|7. | REGISTRATION;
LOCK-UP.
|-- | ----------------------

| | 7.1. | As
soon as practicable following the Closing, and in no event later than six (6)
                    months following the closing of the Bench Transaction Agreement,
Buyer shall                     file a registration statement with respect to the Buyer
Stock on Form 10, Form                     10-SB or any successor form with the SEC (the
Registration                     Statement).
| | ---- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 7.2. | Buyer
shall grant to Seller piggy-back registration rights with respect to (a)
                    the Share Consideration, including any Holdback Shares issued and/or
transferred                     to Seller pursuant to this Agreement, and (b) any
Additional Buyer Stock                     actually issued by Buyer to Seller pursuant to
this Agreement (collectively, (a)                     and (b) shall be referred to as the
Registerable Securities),                     all in accordance with
the Registration Rights Agreement to be executed by the                     parties
hereto on or prior to the Closing, such that if Buyer undertakes to
                    register the resale of shares of Buyer Stock held by any affiliates
of Buyer,                     Buyer must allow Seller to have a pro rata amount of
Registrable Securities                     included in such registration statement. Said
registration rights shall also                     apply to any bonus shares and/or
rights offerings and/or similar distributions                     made by Buyer with
respect to the Registerable Securities.
| | ---- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|8. | RESTRICTIVE
PROVISIONS.
|-- | -----------------------

Until the earlier of (a) such time as
all Registerable Securities may be sold by non-affiliates of Seller immediately without
registration under the Securities Act and without volume restrictions pursuant to Rule
144(k); and (b) such time as Seller ceases to hold at least thirty percent (30%) of the
Buyer Stock issued to Buyer pursuant to this Agreement (adjusted for any stock splits,
combinations or the like), Buyer shall not make any payment to, or sell, lease, transfer,
license or otherwise dispose of any of its properties or assets to, or purchase any
property or assets from, or enter into or make or amend any transaction, contract,
agreement, understanding, loan, advance or guarantee with, or for the benefit of, any
affiliate of Buyer other than its wholly-owned subsidiaries (each of the foregoing, an
Affiliate Transaction) without Sellers prior written consent,
unless (i) such Affiliate Transaction is on terms that are not materially less
favorable to Buyer than those that could have been obtained in a comparable transaction by
Buyer with an unrelated person or (ii) such Affiliate Transaction has been approved by a
majority of the independent members of Buyers Board of Directors. Notwithstanding
anything to the contrary herein, this Section 8 shall not prohibit: (x) any
reasonable employment agreement between Buyer and an executive officer of Buyer that is
approved (1) by a majority of the Board of Directors or (2) if such executive officer is a
director, by a majority of the Board of Directors excluding such executive officer; (y)
any reasonable employment agreement or other compensation plan or arrangement paid or made
available to officers or employees of Buyer for services actually rendered or to be
rendered and entered into by Buyer in the ordinary course of business and consistent with
past practice; or (z) any transaction described on Schedule 8.

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|9. | CONDITIONS
PRECEDENT TO BUYERS OBLIGATIONS.
|-- | --------------------------------------------

The obligation of the Buyer to
consummate the Closing shall be subject to the satisfaction at or prior to the Closing of
each of the following conditions (to the extent noncompliance is not waived in writing by
the Buyer):

| | 9.1. | Representations
and Warranties True at Closing. The representations and
                    warranties made by Seller in or pursuant to this Agreement shall be
true and                     correct at and as of the Closing Date with the same effect
as though such                     representations and warranties had been made or given
at and as of the Closing                     Date.
| | ---- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 9.2. | Compliance
with Agreement. The Seller shall have performed and complied                     with
all of its obligations and covenants under this Agreement to be performed
                    or complied with by it on or prior to the Closing Date.
| | ---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 9.3. | No
Material Adverse Change. The Acquired Assets shall remain intact and
                    in the same operating condition and repair as of the date hereof and
no material                     adverse change shall have been incurred, in the
reasonable judgment of Buyer,                     with respect thereof since the date
hereof.
| | ---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 9.4. | 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, which                     prohibits the consummation of any of the
transactions contemplated by this                     Agreement.
| | ---- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 9.5. | Employment
Agreements. Each of the Hired Personnel shall have executed                     and
delivered to the Buyer an employment or consultancy agreement in forms
                    acceptable to Buyer.
| | ---- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 9.6. | Escrow
Agreement. Seller and Escrow Agent shall have executed and
                    delivered the Escrow Agreement.
| | ---- | ---------------------------------------------------------------------------------------------------------------------

| | 9.7. | Consents
of Third Parties. The Seller shall have obtained any third party
                    consents, waivers, undertakings and agreements required in connection
with the                     transactions contemplated hereby, as evidenced in documents
to the satisfaction                     of the Buyer and the Buyers counsel.
| | ---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 9.8. | Government
Approvals. Buyer shall have received any required governmental
                    approvals with regard to the consummation of the transactions
contemplated under                     this Agreement.
| | ---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 9.9. | Due
Diligence Review. Buyers legal, financial and technical due
                    diligence review of the Business and the Acquired Assets shall have
been                     completed, with the results of such review being to the sole and
complete                     satisfaction of Buyer.
| | ---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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| | 9.10. | Notices
to NASDAQ the TASE and the ISA. The Seller shall have made all
                    required filings of notices with NASDAQ, the Tel Aviv Stock Exchange
and the                     Israel Securities Authority, if any, and has received no
notice that could                     reasonably be expected to have a Seller MAE.
| | ----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 9.11. | Bridge
Financing. Buyer shall have obtained a bridge financing in an
                    amount of no less than $1,000,000 upon commercially reasonable terms
for such an                     instrument.
| | ----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|10. | CONDITIONS
PRECEDENT TO SELLERS OBLIGATIONS.
|--- | ---------------------------------------------

The obligation of the Seller to
consummate the Closing shall be subject to the satisfaction, at or prior to the Closing,
of each of the following conditions (to the extent noncompliance is not waived in writing
by the Seller):

| | 10.1. | Representations
and Warranties True at Closing. The representations and
                    warranties made by the Buyer in this Agreement shall be true and
correct at and                     as of the Closing Date with the same effect as though
such representations and                     warranties had been made or given at and as
of the Closing Date.
| | ----- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 10.2. | Compliance
with Agreement. The Buyer shall have performed and complied                     with
all of its obligations and covenants under this Agreement that are to be
                    performed or complied with by it at or prior to the Closing.
| | ----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 10.3. | No
Material Adverse Change. From the date hereof until the Closing, there
                    will have been no material adverse change in the financial or
business condition                     of the Buyer, in the reasonable judgment of the
Seller.
| | ----- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 10.4. | 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, which                     prohibits the consummation of any of the
transactions contemplated by this                     Agreement.
| | ----- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 10.5. | Good
Standing. Buyer shall have received a certificate of good standing
                    from the Secretary of State of the State of Delaware or other
appropriate                     office, dated as of a date within ten days prior to the
Closing Date certifying                     that Buyer is in good standing as a
corporation in the State of Delaware and has                     filed all tax returns
required to have been filed by it to date and has paid all                     taxes
reported as due thereon.
| | ----- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 10.6. | Stockholders
Register. The Buyer shall have delivered to Seller a                     certified
copy of the Buyers Stockholders Register. Promptly after the
                    Closing, the Buyer shall make all adjustments to its Stockholders
Register as                     may be necessary to reflect the issuance of the Share
Consideration (including                     the Holdback Shares) and shall deliver a
certified copy of such Stockholders                     Register, as so adjusted, to the
Seller.
| | ----- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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| | 10.7. | Closing
of the Bench Transaction Agreement. Buyer shall have consummated
                    the closing of the Bench Transaction Agreement in accordance with its
terms, and                     the merged company shall assume in writing all of Buyers
undertakings                     hereunder. Furthermore, the price per share of Buyer
Stock sold in the Offering                     (as defined in the Bench Transaction
Agreement), and the exchange price per                     share of Buyer Stock in Buyers
proposed transaction pursuant to an                     Agreement and Plan of Share
Exchange to be entered into with World Wide Pin                     Payment, Inc. (if
consummated), shall have been at least $1.50.
| | ----- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 10.8. | Consents
of Third Parties. The Buyer shall have obtained all third party
                    consents, waivers, undertakings and agreements, including without
limitation all                     consents necessary from Buyers lenders,
creditors, vendors and lessors                     under contracts set forth in Schedule6.13 attached hereto, required in connection with
                    the transactions contemplated hereby, as evidenced in documents to
the                     satisfaction of the Seller and the Sellers counsel.
| | ----- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 10.9. | Government
Approvals. Seller shall have received all required                     governmental
approvals with regard to the consummation of the transactions
                    contemplated under this Agreement.
| | ----- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 10.10. | Opinion
of Counsel. Kramer Levin Naftalis & Frankel LLP, counsel to
                    Buyer, shall have delivered to the Seller a written opinion,
addressed to the                     Seller and dated as of the Closing Date,
substantially in the form of Schedule 10.10 attached hereto.
| | ------ | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 10.11. | Employment
Agreements. Each of the Hired Personnel shall have executed                     and
delivered to the Seller a release from any rights or demands in connection
                    with their employment with the Seller or the termination thereof, in
                    substantially the form of Schedule 10.11 attached
                    hereto.
| | ------ | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 10.12. | Registration
Rights Agreement. The Buyer shall have delivered to Seller a                     duly
executed Registration Rights Agreement, substantially in the form of Exhibit D attached
hereto.
| | ------ | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 10.13. | Due
Diligence Review. Sellers due diligence review of the Buyer
                    shall have been completed, with the results of such review being to
the sole and                     complete satisfaction of Seller.
| | ------ | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 10.14. | Bridge
Financing. Buyer shall have obtained a bridge financing in an
                    amount of no less than $1,000,000 upon commercially reasonable terms
for such an                     instrument.
| | ------ | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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|11. | CONFIDENTIALITY.
|--- | ----------------

| | 11.1. | Confidential
Information. The Parties acknowledge that each Party (in                     such
capacity, the Receiving Party) may have access to or
                    have disclosed to it or to its affiliates and their respective
officers,                     directors, employees, agents and shareholders information
relating to the other                     Party (in such capacity, the Disclosing
Party), its                     affiliates or its or their business, clients
and/or potential clients which is                     of a confidential nature (Confidential
Information).                     Confidential Information shall include, but
not be limited to, methods,                     processes, formulae, compositions,
systems, techniques, machines, computer                     programs, electronic data,
research projects, story research, potential story                     topics, business
memos, customer and contact lists, pricing data, sources of                     supply,
financial data and marketing, production or merchandising systems or
                    plans. Confidential Information may be designated or marked as
proprietary or                     confidential by the Disclosing Party, but the absence
of such designation or                     marking shall not support a conclusion that
the information does not comprise                     Confidential Information.
| | ----- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 11.1.1. | The
Receiving Party shall at all times keep documents or other materials
                    containing Confidential Information in a secure place, shall not use
the                     Confidential Information for any purpose other than the
evaluation of the                     transactions contemplated by this Agreement, except
as otherwise agreed to in a                     writing signed by the Disclosing Party,
and shall not disclose any of the                     Confidential Information in any
manner whatsoever, in whole or in part, to any                     Person for any reason
or purpose whatsoever except (i) if the Receiving Party is                     required
by a court of competent jurisdiction to so disclose after notice has
                    been given to the Disclosing Party and the Disclosing Party has had
an                     opportunity to oppose such disclosure or seek a protective order
to the extent                     practicable, (ii) to employees and representatives of
the Receiving Party who                     need to know such information in connection
with Sellers acquisition of                     Buyer Stock and Buyers
acquisition of the Acquired Assets pursuant to this                     Agreement and
with the other transactions contemplated hereby                     (Necessary
Agents) provided that Receiving Party shall inform                     each
such Necessary Agent of the confidential nature of such information, obtain
                    their agreement (the Necessary Agent ConfidentialityAgreement)
to hold all Confidential Information in strict                     confidence and not to
use it for any purpose other than as permitted hereunder                     and ensure
the performance by each Necessary Agent of such Necessary Agent
                    Confidentiality Agreement.
| | ------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 11.1.2. | Notwithstanding
anything in this Agreement to the contrary, the term                     ConfidentialInformation does not include information                     that: (1)
is generally known to the public other than as a result of the breach
                    by Receiving Party or its affiliates or any of their respective
officers,                     directors, employees, agents and shareholders of an
obligation of                     confidentiality to Disclosing Party, (2) was known by
Receiving Party (as                     evidenced by written records) prior to its
receipt by the Holder from Disclosing                     Party, (3) was disclosed to
Receiving Party by a third party under no obligation                     of confidence,
(4) was developed by Receiving Party independently of any                     disclosure
made by Disclosing Party to Receiving Party, provided, that Receiving
                    Party shall have the burden of showing that such Confidential
Information was                     developed independently of any disclosure by
Disclosing Party.
| | ------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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| | 11.2. | Publicity.Except
as required by law, regulation or stock                     exchange, or as may be
required to enforce its rights under this Agreement, each                     of the
parties shall (a) keep the material terms of this Agreement confidential
                    and (b) obtain the prior written consent of the other Party to any
public                     announcement relating to the transactions contemplated by this
Agreement,                     including the text and the exact timing of any such
announcement. Each party                     acknowledges that the other party may likely
be required publicly to describe                     and to file a copy of this Agreement
as an exhibit to its Securities Act filings                     (including, with respect
to the Buyer, the Registration Statement) and to                     reports it files
under the Exchange Act.
| | ----- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|12. | REPORTS.
|--- | --------

| | The
Buyer undertakes to  provide Seller with: (i) audited, US dollar-denominated
annual financial statements, according to the US GAAP, within ninety (90) days after the
end of each fiscal year; (ii) unaudited, US dollar-denominated quarterly
financial statements, according to the US GAAP, within forty-five (45) days of the end of
each fiscal quarter; and (iii)  promptly following Sellers written
request, such other information or consents as may be required to allow Seller
to comply with any applicable rule or regulation, in the United States and Israel,
including without limitation, rules of the SEC, Nasdaq, the Israeli Securities
Authority and the Tel-Aviv Stock Exchange.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|13. | INDEMNIFICATION.
|--- | ----------------

| | Subject
to the provisions hereof, Buyer and Seller each agree (in such capacity, the
Indemnifying Party) fully to indemnify and hold harmless, the other
Party and its affiliates and their respective shareholders, directors, officers and agents
(in such capacities, collectively, the Indemnified Party), effective as
and from the date hereunder, from and against all claims, losses, liabilities and expenses
which may be made or brought against the Indemnified Party or which it may suffer or
incur, directly or indirectly as a result of or in connection with: (i) any material
breach of this Agreement on the part of the Indemnifying Party; or (ii) any material
misstatement or omission contained in any representation or warranty of the Indemnifying
Party made in this Agreement (including its Schedules), and such indemnity shall include
reasonable legal fees and expenses in connection with any action or proceeding against the
Indemnifying Party. It is hereby agreed that the indemnification obligations under this
Section 13 shall remain in effect for a period of thirty six (36) months
following the Closing.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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|14. | TERMINATION.
|--- | ------------

| | 14.1. | The
Seller and the Buyer will use their reasonable best efforts to effect the
                    Closing and to cause the conditions to the other Partys
obligations to                     close to be timely satisfied. Unless otherwise agreed
in writing by the parties,                     this Agreement may be terminated at any
time prior to the Closing Date by either                     the Buyer or the Seller in
writing, without liability to the terminating party                     on account of
such termination (provided the terminating party is not otherwise                     in
default or in breach of this Agreement) if one or more of the conditions to
                    the terminating partys obligation to effect the Closing
hereunder is not                     fully satisfied within forty-five (45) days from the
date hereof. If either                     Seller or Buyer is in breach of the first
sentence of this Section                     14.1, then the other may terminate
this Agreement no fewer than                     fifteen (15) days after providing a
Termination Notice (as defined below) to the                     breaching party;
provided that the breaching party has not cured such breach and
                    caused all closing conditions identified in the Termination Notice to
be                     satisfied prior to the expiration of such fifteen (15) day period.
                    Termination Notice shall mean a written notice
which                     specifies: (i) which closing conditions remain unsatisfied that
are not waived                     (the OutstandingConditions)
(it being agreed that                     any conditions not identified in the
Termination Notice shall be deemed waived);                     (ii) the date (which must
be no fewer than fifteen (15) days after the                     Termination Notice is
delivered) as of which this Agreement shall be terminated                     if the
Outstanding Conditions are not satisfied prior thereto.
| | ----- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 14.2. | In
the event that this Agreement is terminated and the transactions contemplated
                    hereby are abandoned as described in Section 14.1, this
                    Agreement shall become null and void and of no further force and
effect, except                     for the provisions of (i) Section 11.1
regarding                     confidentiality; (ii) Section 11.2 regarding
publicity; and                     (iii) this Section 14. Nothing in this Section 14 shall
be deemed to release any party from any                     liability for any breach by
such party of the terms and provisions of this                     Agreement.
| | ----- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|15. | GENERAL.
|--- | --------

| | 15.1. | Survival
of Representations and Warranties. The representations and
                    warranties of the parties hereto contained in this Agreement or
otherwise made                     in writing in relation to, or in connection with, the
transactions contemplated                     hereby shall survive the Closing Date and
the consummation of the transactions                     contemplated herein.
| | ----- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 15.2. | Brokers.
Except as set forth in Schedules 5.16 or                     6.18 hereto,
Buyer and Seller agree that there were no                     finders or brokers involved
in bringing the parties together or who were                     instrumental in the
negotiation, execution, or consummation of this Agreement.                     Buyer and
Seller each agree to indemnify the other against any claim by any
                    third person for any commission, brokerage, or finders fee
arising from                     the transactions contemplated hereby based on any
alleged agreement or                     understanding between the indemnifying party and
such third person, whether                     express or implied from the actions of the
indemnifying party.
| | ----- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 15.3. | Expenses
and Taxes. Each party shall bear its own legal fees and                     any
other fees incurred by it in connection with the transaction hereunder,
                    including in connection with the negotiations, due diligence and
preparation of                     this Agreement. Buyer and Seller shall bear all of
their respective taxes in                     connection with this Agreement and the
transactions contemplated hereunder.
| | ----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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| | 15.4. | Notices.
All notices, demands and other communications hereunder shall be                     in
writing or by written telecommunication, and shall be deemed to have been
                    duly given if delivered personally or if mailed by certified or
registered mail,                     return receipt requested, postage prepaid, or if
sent by overnight courier, or                     sent by written telecommunication with
confirmation of receipt, as follows:
| | ----- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | If
to the Seller, to:
| | ---------------------

| | B.O.S. Better Online Solutions Ltd. 
Beit Rabin, Teradyon Industrial Park, Misgav  
Facsimile: 972-4-999-0334  
Attn: Adiv Baruch, CEO and Nehemia Kaufman, CFO
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------

| | with
a copy sent contemporaneously to:
| | --------------------------------------

| | Amit, Pollak, Matalon, & Ben-Naftali, Erez &Co. 
NYP Tower  19th Floor 
17 Yitzhak Sadeh Street 
Tel Aviv, 67775, Israel  
Facsimile:  972-3-5613620 
Attn: Shlomo Landress, Adv.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | If
to the Buyer, to:
| | --------------------

| | Qualmax, Inc. 
340 West Fifth Avenue 
Eugene, Oregon 97401 
Facsimile: (541) 683-4009 
Attn: Mr. M.
David Kamrat
| | ----------------------------------------------------------------------------------------------------------------

| | with
a copy sent contemporaneously to:
| | --------------------------------------

| | Kramer Levin Naftalis & Frankel LLP 
1177 Avenue of the Americas 
New York, New York 10036 
Facsimile: (212) 715-8000 
Attn: Scott S. Rosenblum, Esq.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------

| | Any
such notice shall be effective (a) if delivered personally, when received, (b) if sent by
reputable courier, the date of delivery by such courier, and (c) if sent by facsimile,
when transmitted with written confirmation of transmission having been received, and if
delivery or transmission is not made on a business day, on the immediately following
business day.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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| | 15.5. | Entire
Agreement. This Agreement (including the Exhibits and Schedules
                    hereof), together with the Escrow Agreement and the Outsourcing
Agreement,                     contain the entire understanding of the parties, supersede
all prior agreements                     and understandings relating to the subject
matter hereof and shall not be                     amended except by a written instrument
hereafter signed by both of the parties                     hereto.
| | ----- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 15.6. | Governing
Law; Venue. This Agreement shall be deemed to have been                     executed
and delivered in the State of New York, and the validity, enforcement
                    and construction hereof shall be governed in all respects by the
internal laws                     (without regard to principles of conflicts of law) of
the State of New York. Any                     legal action or proceeding arising under
or in relation to this Agreement shall                     be brought exclusively in a
federal or state court of competent jurisdiction                     within the State and
County of New York. In addition, each of the undersigned                     parties
consents and agrees that any court in which such legal action or
                    proceeding is commenced may exercise jurisdiction over his, her or
its person                     for purposes of enforcing the terms of this Agreement and
agrees not to assert                     that venue in New York is inappropriate or
inconvenient.
| | ----- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 15.7. | Sections
and Section Headings. The headings of sections and subsections
                    are for reference only and shall not limit or control the meaning
thereof.
| | ----- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 15.8. | Assigns.
This Agreement shall be binding upon and inure to the benefit of                     the
parties hereto and their respective heirs, successors and permitted assigns.
                    Neither this Agreement nor the obligations of any party hereunder
shall be                     assignable or transferable by such party without the prior
written consent of                     the other party hereto.
| | ----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 15.9. | Severability.
In the event that any covenant, condition, or other                     provision herein
contained is held to be invalid, void, or illegal by any court                     of
competent jurisdiction, the same shall be deemed to be severable from the
                    remainder of this Agreement and shall in no way affect, impair, or
invalidate                     any other covenant, condition, or other provision
contained herein.
| | ----- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 15.10. | Further
Assurances. The parties agree, without any additional
                    consideration, to take such reasonable steps and execute such other
and further                     documents as may be necessary or appropriate to cause the
terms and conditions                     contained herein to be carried into effect.
| | ------ | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 15.11. | NEITHER
PARTY OR ITS AFFILIATES SHALL BE LIABLE TO THE OTHER PARTY OR ITS
                    AFFILIATES UNDER THIS AGREEMENT FOR OR IN RESPECT OF ANY PUNITIVE,
SPECIAL,                     INDIRECT, EXEMPLARY INCIDENTAL OR CONSEQUENTIAL LOSS OR
DAMAGES (INCLUDING BUT                     NOT LIMITED TO LOST PROFITS) OF ANY KIND
WHATSOEVER, WHETHER BASED UPON THEORIES                     OF CONTRACT, NEGLIGENCE, TORT
OR OTHERWISE, AND EVEN IF SUCH PARTY KNEW OF THE                     POSSIBILITY OR
LIKELIHOOD OF THE POTENTIAL FOR SUCH DAMAGES.
| | ------ | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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| | 15.12. | Counterparts.
This Agreement may be executed in multiple counterparts,                     each of
which shall be deemed an original, but all of which together shall
                    constitute one and the same instrument.
| | ------ | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

(remainder
of the page is left intentionally blank)

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IN
WITNESS WHEREOF, and intending to be legally bound hereby, the parties hereto have caused
this Agreement to be duly executed and delivered as of the date and year first above
written.

| |  | QUALMAX, INC.By: 
Name: __________________________Title: ___________________________
| |  | -----------------------------------------------------------------------------------------------------

| |  | B.O.S. BETTER ONLINE SOLUTIONS LTD.By: 
Name: Adiv Baruch     Nehemia Kaufman
Title:           CEO
                     CFO
| |  | --------------------------------------------------------------------------------------------------------------------------------------------



---

---

# List of Exhibits and
Schedules

# [omitted]

|Exhibit / Schedule | Title                                                   
|------------------ | --------------------------------------------------------
|Exhibit A          | Acquired Assets                                         
|Exhibit B          | Form of Outsourcing Agreement                           
|Exhibit C          | The Bench Transaction Agreement                         
|Exhibit D          | Form of Escrow Agreement                                
|                   |                                                         
|Schedule 1.2(i)    | Encumbrances on Acquired Assets                         
|Schedule 1.2(ii)   | OCS Transfer of Rights Form                             
|Schedule 1.2(iii)  | OCS Undertaking Form                                    
|Schedule 1.4       | Schedule of Payments - Qualmax & BOS                    
|Schedule 5.4       | Non-Acquired Assets used in the Business                
|Schedule 5.10      | Absence of Changes - BOS                                
|Schedule 5.11      | BOS Material Contracts Related to the Business          
|Schedule 5.14      | Supplemental Regulation S Representations and Warranties
|Schedule 5.16      | BOS Brokers                                             
|Schedule 6.5       | Buyer Capitalization Table                              
|Schedule 6.7(a)    | Qualmax Financial Statements                            
|Schedule 6.9       | Qualmax Options and Warrants                            
|Schedule 6.10      | Absence of Changes - Qualmax                            
|Schedule 6.11      | Encumbrances on Assets - Qualmax                        
|Schedule 6.13      | Qualmax Material Contracts                              
|Schedule 6.16      | Qualmax Insurance Policies                              
|Schedule 6.18      | Qualmax Brokers                                         
|Schedule 8         | Permitted Affiliate Transactions                        
|Schedule 10.10     | Opinion of Counsel to Qualmax                           
|Schedule 10.11     | Employee Release                                        



---

---

# AMENDMENT NO. 1 TO
ASSET PURCHASE AGREEMENT

AMENDMENT
NO. 1 TO ASSET PURCHASE AGREEMENT (this Amendment), dated as of
November 2, 2005 by and among Qualmax, Inc., an Oregon corporation
(Buyer), BOScom Ltd., an Israeli company having its address at Beit
Rabin, Teradyon Industrial Park, Misgav 20179 (BOScom) and B.O.S.
Better Online Solutions Ltd., an Israeli company having its address at Beit Rabin,
Teradyon Industrial Park, Misgav 20179 (BOS and, together with BOScom,
Seller). Capitalized terms used but not defined herein have the
respective meanings ascribed to them in the Asset Purchase Agreement, dated as of October
26, 2005, by and among Buyer, BOScom and BOS (the Agreement).

WHEREAS,
Buyer has entered into a letter agreement with Bench providing, inter allia, that,
in connection with the Share Exchange, Bench would issue between 500,000 and 1,000,000
additional shares of Buyer Stock (the Delay Shares) to Buyers
former shareholders;

WHEREAS,
Buyer has caused Bench Group, Inc. to circulate a Supplement to Confidential Private
Placement Memorandum, dated November 2, 2005 (the PPM Supplement); and

WHEREAS,
the parties desire to revise the terms of the Agreement in accordance with this Amendment
in order to revise and clarify certain matters relating thereto.

NOW
THEREFORE, in consideration of the premises and the mutual agreements contained herein and
for other good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, and intending legally to be bound, the parties hereto hereby agree as
follows:

1.        Section
3.1.1 of the Agreement is hereby amended in its entirety to read as           follows:

| | 3.1.1. | Share
Consideration. At the Closing, Buyer shall issue
                    Seller 4,131,579 shares of Common Stock, par value $0.001 each (the
                    Buyer Stock), of Bench Group, Inc. post the
closing of the                     Bench Transaction Agreement (as defined below), and,
as soon as practicable                     following the termination of the Offering (as
defined in the Bench Transaction                     Agreement), Buyer shall issue Seller
an additional number of shares of Buyer                     Stock equal to 4,000,000
multiplied by a fraction, the numerator of which is the                     difference of
(x) the sum of 15,200,000 and the number of Delay Shares issued                     minus
(y) 15,700,000, and the denominator of which is 15,200,000. Such payments
                    by way of issuance of shares of Buyer Stock to Seller shall be
referred to                     herein as the ShareConsideration.
| | ------ | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | In
this Agreement, the Bench Transaction Agreement means the Agreement
and Plan of Share Exchange between Buyer and Bench Group, Inc., dated June 24, 2005, as
amended on July 15, 2005 and which is attached hereto as Exhibit C,
and as further amended by the letter agreement between Buyer and Bench Group, Inc., dated
as of October 28, 2005, a copy of which is attached hereto as Exhibit E.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

2.        The
Agreement is hereby amended by adding Exhibit E to this
          Amendment as Exhibit E thereto.

3.        The
first sentence of Section 3.2.1 of the Agreement is hereby amended in its
          entirety to read as follows:



---

---

| | 3.2.1. | One
quarter of the shares of Buyer Stock constituting Share Consideration (the Holdback
Shares) shall be delivered to Kramer Levin Naftalis                     & Frankel
LLP (the Escrow Agent) pursuant to the terms                     and
conditions of the Escrow Agreement attached as Exhibit                     D hereto
(the Escrow Agreement).
| | ------ | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

4.        Section
3.2.3 of the Agreement is hereby amended in its entirety to read as           follows:

| | 3.2.3 | In
the event that during the full four (4) consecutive quarters following the Closing Date
(the Escrow Period) the financial statements of Buyer reflect gross
sales, as defined according to US GAAP, related to the Business, as reflected in Buyers
consolidated financial statements and without including revenues from Qualmaxs
other businesses (the Business Revenues), equal, in aggregate, to Six
Million US Dollars (US$ 6,000,000) or more (a Triggering Event), then
the Holdback Shares (including any Distributions related thereto) shall be transferred by
the Escrow Agent to the Seller in accordance with the provisions of the Escrow Agreement.
In the event that Business Revenues during the Escrow Period amount to less than
US$4,000,000 the Buyer shall be entitled to receive all of the Holdback Shares from the
Escrow Agent. For every $100,000 deficit in Business Revenues below $6,000,000, five
percent (5%) of the Holdback Shares shall be transferred by the Escrow Agent to the Buyer
and the remainder of the Holdback Shares shall be transferred by the Escrow Agent to the
Seller.
| | ----- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

5.        Section
6.5 of the Agreement is hereby amended to delete 25,000,000           shares and
to replace it with 26,500,000 shares. Schedules 6.5           and 6.9 to the
Agreement are hereby amended in their entirety to read as set           forth in Schedules
6.5 and 6.9 attached to this Amendment.

6.        Section
10.7 of the Agreement is hereby amended to delete $1.50 at           the end
thereof and to replace it with the following:

| | $1.4522253,
if only 500,000 Delay Shares are issued, and such minimum per share price shall be
reduced, on a pro rata basis, to a minimum of $1.4074074, if and to the extent that any
additional Delay Shares (up to 500,000 additional Delay Shares) are issued.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

7.        Except
as amended hereby, the Agreement shall continue in full force and effect,           and
each party hereto hereby confirms its agreement to the Agreement as amended           by
this Amendment.

8.        This
Amendment may be executed in two or more counterparts, each of which shall           be
deemed an original, but all of which shall together constitute one and the           same
instrument.

# [Signature page
follows immediately]



---

---

IN
WITNESS WHEREOF, the parties hereto have executed, or have caused this Amendment to be
executed by their respective duly authorized officers, as of the date first above-written.

| |  | QUALMAX, INC.By: 
Name: __________________________Title: ___________________________
| |  | -----------------------------------------------------------------------------------------------------

| |  | BOSCOM LTD.By: 
Name: __________________________Title: ___________________________
| |  | ---------------------------------------------------------------------------------------------------

| |  | B.O.S. BETTER ONLINE SOLUTIONS LTD.By: 
Name: Adiv Baruch     Nehemia KaufmanTitle:           CEO
                     CFO
| |  | -------------------------------------------------------------------------------------------------------------------------------------------

[Exhibits and schedules omitted]



---

---

# AMENDMENT NO. 2 TO
ASSET PURCHASE AGREEMENT

AMENDMENT
NO. 2 TO ASSET PURCHASE AGREEMENT (this Amendment), dated as of
December 31, 2005 by and among Qualmax, Inc., a Delaware corporation f/k/a Bench Group,
Inc. and the successor by merger to Qualmax, Inc., an Oregon corporation
(Qualmax), Qualmax Ltd., an Israeli company and a wholly owned
subsidiary of Qualmax (Qualmax Sub and, together with Qualmax,
Buyer), BOScom Ltd., an Israeli company having its address at Beit
Rabin, Teradyon Industrial Park, Misgav 20179 (BOScom), B.O.S. Better
Online Solutions Ltd., an Israeli company having its address at Beit Rabin, Teradyon
Industrial Park, Misgav 20179 (BOS) and Quasar Telecom (2004) Ltd., an
Israeli company and a wholly owned subsidiary of BOS (Quasar and,
together with BOScom and BOS, Seller). Capitalized terms used but not
defined herein have the respective meanings ascribed to them in the Asset Purchase
Agreement, dated as of October 26, 2005, by and among Qualmax, BOScom and BOS, as amended
by Amendment No. 1 thereto, dated as of November 2, 2005 (collectively, the
Agreement).

WHEREAS,
the parties, in the interest of reaching a Closing, desire to amend the Agreement in
accordance with this Amendment.

NOW
THEREFORE, in consideration of the premises and the mutual agreements contained herein and
for other good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, and intending legally to be bound, the parties hereto hereby agree as
follows:

1.        Each
of Qualmax Sub and Quasar is hereby joined as a party to the Agreement.           Qualmax
Sub hereby agrees to be bound by the Agreement in its capacity as Buyer
          thereunder. Quasar hereby agrees to be bound by the Agreement in its capacity
as           Seller thereunder.

2.        Section
1.1 of the Agreement is hereby amended in its entirety to read as           follows:

| | 1.1 | Acquired
Assets. Subject to the terms and conditions set forth in this Agreement, at the
Closing referred to in Section 4 hereof, Seller shall sell, assign, transfer and
deliver to Qualmax Sub, and Qualmax Sub shall purchase, acquire and take assignment and
delivery of, all of the assets and rights of Seller relating to, or used in connection
with, the Business, including without limitation, the Business IP (as defined below),
except for those expressly set forth on Schedule 5.4 (all of which assets and
rights are hereinafter referred to collectively as the Acquired Assets).
The Acquired Assets shall include, without limitation, those assets set forth on Exhibit
A attached hereto.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

3.        Section
1.2(a) of the Agreement is hereby amended in its entirety to read as           follows:

| | 1.2. | (a) | Seller represents and warrants to Buyer that, upon Buyers purchase of
               the Acquired Assets in accordance with this Agreement, Buyer will take the
               Acquired Assets free and clear of all encumbrances or rights and claims of
any                third party, except for the obligation to pay royalties to the Office
of the                Chief Scientist of the Israeli Ministry of Trade, Industry and
Labor (the                OCS). The amounts paid to date and the
amounts remaining                outstanding as royalties by Seller to the OCS and,
subject to Section                8A.6 hereof, to which Buyer will become
obligated pursuant to this Agreement                as of the Closing, are set forth on
Schedule 1.2(i).
| | ---- | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



---

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4.        Section
2.2 of the Agreement is hereby amended in its entirety to read as           follows:

| | 2.2 | A
list specifying the Employees whom Buyer is interested in employing or retaining as
consultants (at Buyers sole discretion) following the Closing, and who, based on
Sellers representation to the Buyer, are interested in being retained by Buyer and
have informally accepted its offer for employment or consulting engagement is attached
hereto as Schedule 2.2, and such persons listed are referred to
herein as the Hired Personnel.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

5.        Section
2.3 of the Agreement is hereby amended in its entirety to read as           follows:

| | 2.3 | Seller
undertakes to retain all Hired Personnel until thirty (30) days following the Closing
Date (the Hirng Date), on which date such Hired Personnel shall begin
to be employed or retained by Buyer on terms substantially similar to the terms enjoyed
by such persons prior to the Closing Date. During the period between the Closing Date and
the Hiring Date, the Hired Personnel shall provide services to Buyer, and Buyer shall
compensate Seller for the use of such employees services, all as set forth more
fully in the Outsourcing Agreement.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

6.        Sections
2.4 and 2.5 of the Agreement are hereby amended by deleting all           references to
Closing Date contained therein and replacing such           references with
Hiring Date.

7.        The
first paragraph of Section 3.1.1 of the Agreement is hereby amended to read           as
follows:

| | 3.1.1. | Share
Consideration. At the Closing, Buyer shall issue to           BOS
3,195,725 shares of Common Stock, par value $0.001 each (the Buyer
          Stock), of Qualmax. Such payment by way of issuance of shares of
Buyer           Stock to BOS, together with any Earn-Out Shares (as defined below) issued
to BOS           pursuant to Section 3.2 hereof, shall be referred to herein as
the           Share Consideration.
| | ------ | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

8.        The
agreement is hereby amended by deleting the ultimate sentence of Section           3.1.2
and replacing it with the following new sentences:

| | Notwithstanding
anything to the contrary in the Agreement, to the extent that any Value Added Tax (VAT)
is imposed upon Buyer with respect to the transactions contemplated by the Agreement,
then, at least five (5) business days prior to the date on which such VAT payment is due,
Seller shall advance (each, a BOS VAT Advance) the amount of such VAT
liability to Buyer. Buyer hereby (i) assigns to Seller any of Buyers right to a
refund of any VAT for which, and to the extent that, Seller has made a BOS VAT Advance
with respect thereto, or (ii) undertakes to transfer to Seller, immediately upon receipt,
any and all sums it receives as a refund from the VAT authorities hereunder. The parties
expressly agree, that the value of the Share Consideration is $4,569,887, being the
product of 3,195,725 shares multiplied by $1.43, which is the value of each share.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



---

---

9.        Section
3.2 of the Agreement is hereby amended in its entirety to read as           follows:

| | 3.2 | Earn-Out
Shares.
| | --- | ----------------

| | 3.2.1 | In
the event that during the full four (4) consecutive quarters following the Closing Date
(the Earn-Out Period), the financial statements of Buyer reflect gross
sales, as defined according to US GAAP, related to sales generated solely by the sales
force of the Business as existing on the Closing Date (the Business Revenues),
equal, in aggregate, to Six Million US Dollars (US$ 6,000,000) or more (a Triggering
Event), then Qualmax shall issue to BOS 1,065,242 shares of Buyer Stock. If
Business Revenues during such full four (4) quarters equal less than US$6,000,000 but
greater than US$4,000,000, then for every $100,000 or portion thereof that Business
Revenues exceed $4,000,000, Qualmax shall issue 53,262 shares of Buyer Stock to BOS.
Shares of Buyer Stock issued pursuant to this Section 3.2.1 shall be referred to
herein as Earn-Out Shares.
| | ----- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 3.2.2 | Business
Operation. Following the Closing and until the end of the Earn-Out Period, Buyer
shall operate the Business consistent with Sellers past practices and a reasonable
business plan, and shall not take any action that would reasonably be expected to cause
the non-occurrence of a Triggering Event. Upon any material breach by Buyer of the
immediately preceding sentence (a Voiding Action), Seller shall be
entitled to have all of the Earn-Out Shares issued to BOS.
| | ----- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 3.2.3 | Reports.
During the Earn-Out Period, for so long as any royalty payments are due hereunder and for
a period of six (6) months thereafter, Buyer shall provide Seller with quarterly reports
certified by Buyers Chief Financial Officer, covering Qualmax Subs activities
with respect to the Business for the respective quarter, including financial statements,
new customers, status of all current customers, license fees received and such other
information as is reasonably necessary to determine: (a) for so long as any royalty
payments are due hereunder, the amount of gross sales (defined by US GAAP) received by
Buyer on sales generated by the Royalty Base Business during such quarter; and (b) during
the Earn-Out Period, the amount of Business Revenues generated during such quarter.
| | ----- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 3.2.4. | Auditing
and Inspection Rights. During the Earn-Out Period and for a           period of six
(6) months thereafter, Seller shall be entitled to review and           audit Buyers
books and records with respect to the Business Revenues,           provided that such
audit shall be conducted by an independent auditor at           Sellers expense;
provided, however, that if such audit reveals that Buyer           had understated
Business Revenues (without subsequently correcting its           calculation thereof) by
more than ten percent (10%), then Buyer shall pay for           the reasonable expenses
of such audit. Seller shall be entitled to exercise its           audit rights under this
Section 3.2.4 every six (6) months, upon notice           of seven (7) business
days to Buyer. Any audit pursuant to this Section           3.2.4 shall be
conducted during Buyers normal business hours so as not           to unreasonably
interfere with Buyers business activities.
| | ------ | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

10.        Subsection
4.2(c) of the Agreement is hereby amended in its entirety to read as           follows:

| | (c) | Buyer
shall provide the Seller with a validly executed share certificate           covering the
Share Consideration (other than any Earn-Out Shares), issued in the           name of the
Seller;
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



---

---

11.        Subsection
4.2(d) of the Agreement is hereby amended in its entirety to read as           follows:

| | (d) | [Reserved]
| | --- | ----------

12.        Subsection
4.2(e) of the Agreement is hereby amended in its entirety to read as           follows:

| | (e) | Buyer
shall provide the Seller with true and correct copies of resolutions of           Buyers
Board of Directors approving the transaction contemplated hereby,           the issuance
of the Share Consideration (including the Earn-Out Shares) and the           payment of
the Royalty Consideration and the potential issuance of Additional           Buyer Stock.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

13.        Subsection
4.2(f) is hereby amended in its entirety to read as follows:

| | (f) | [Reserved]
| | --- | ----------

14.        Section
5.4 of the Agreement is hereby amended in its entirety to read as           follows:

| | 5.4 | Acquired
Assets. Seller is the owner of and has good and marketable title to all of the
Acquired Assets, free and clear of all encumbrances or rights and claims of any third
party (except for the OCS, to the extent set forth on Schedule 1.2(i)hereto)
or restrictions on transfer. To the best of Sellers knowledge: (i) no claims were
made or threatened in relation to the Acquired Assets; (ii) the Acquired Assets do not
breach or infringe on any third partys rights; and (iii) the Acquired Assets are in
operable condition and repair. Except as set forth on Schedule 5.4,
the Acquired Assets constitute all of the assets that Seller currently uses in, or that
are necessary for the conduct of, the Business.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

15.        Section
5.6 of the Agreement is hereby amended in its entirety to read as           follows:

| | 5.6 | Except
as would not have a material adverse effect, Seller has all licenses (including, without
limitation, encryption licenses), franchises, permits, and other government
authorizations that are legally required to enable it to conduct the Business and related
operations in all material respects as such Business and operations are conducted as of
the Closing date, and to use, occupy and own all of the Acquired Assets in all material
respects as such Acquired Assets are currently used, occupied and owned as of the Closing
date. Copies of all such licenses, franchises, permits and other governmental
authorizations have been delivered to Buyer and its counsel. Except for (a) compliance
with federal and state securities or corporation laws, and (b) obtaining the approval of
the OCS and as provided for in this Agreement, no authorization, approval, consent, or
order of, or registration, declaration, or filing with, any court or other governmental
body, or any stock exchange or quotation system, is required in connection with the
execution and delivery by Seller of this Agreement and the consummation by Seller of the
transactions contemplated hereby.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



---

---

16.        Section
5.9 of the Agreement is hereby amended by replacing the last sentence
                    thereof with the following new sentence:

| | The
Seller Annual Report and all reports Seller has filed with the SEC thereafter, when
filed, were free of material errors and omissions, except to the extent modified or
superceded by subsequent filings and/or by disclosures made in this Agreement, including
the Schedules hereto.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

17.        The
following is hereby added at the end of Section 5.11 of the Agreement:

| | Each
material contract listed in said Schedule 5.11, is in full force and
effect. Neither Seller nor, to Sellers knowledge, any other party to such material
contract, is in breach of any such material contract.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

18.        Section
5.15 of the Agreement is hereby amended in its entirety to read as           follows:

| | 5.15 | No
Litigation. Except for a lawsuit instigated by BOSaNova Eurl against BOS, Qualmax,
and Media Partners International before the Trade Tribunal at Nanterre (France) (the
Bosanova Litigation), a copy of which has been provided to Buyer and
its counsel, Seller, with respect to the Acquired Assets, (i) is not subject to any
outstanding injunction, judgment, order, decree, ruling, or charge and (ii) is not a
party and, to the knowledge of Seller, is not threatened to be made a party to any
action, suit, proceeding, hearing, or investigation of, in, or before any court or quasi
judicial or administrative agency of any federal, state, local, or foreign jurisdiction
or before any arbitrator. Seller has no reason to believe that any such action; suit,
proceeding, hearing, or investigation may be brought or threatened against Seller.
| | ---- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

19.        The
Agreement is hereby amended to add the following Section 5.19 to Section 5
          thereof:

| | 5.19 | Grants
and Incentives. Schedule 5.19 sets forth a complete list of all
grants and incentive programs (Grants) from any Israeli governmental
entity to Seller with respect to the Business or the Acquired Assets or by which any of
the Acquired Assets is bound, including but not limited to: (a) Grants under Certificates
of Approval of the OCS (Approved Plans), and (b) Grants from the
Israeli Fund for the Promotion of Marketing. True and correct copies of all letters of
approval, and supplements thereto, granted to Seller with respect to any Grants and all
undertakings made by Seller with respect to such Grants have previously been delivered to
Buyer and its counsel. Seller is in material compliance with the terms and conditions of
the Grants and has fulfilled in all material respects all the undertakings and
obligations relating thereto. To the best knowledge of Seller, there are no events which
may lead to the annulment or limitation of any of the Grants.
| | ---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



---

---

20.        The
Agreement is hereby amended to add the following Section 5.20 to Section 5
          thereof:

| | 5.20 | Intellectual
Property. Seller owns or is licensed or otherwise has, and, shall transfer to Buyer
at Closing, the right to use all trademarks, service marks, trade names, copyrights,
trade secrets, licenses, franchises and other rights, products, processes and methods,
computer software, computer programs and similar intangible assets which are necessary
for the operation of the Business as presently conducted by Seller or that have been
developed by Seller for current or future use in connection with the Business or the
Acquired Assets (collectively the Business IP). Seller is not aware of
any violation or infringement by a third party of any of the Business IP owned by Seller.
To Sellers knowledge, no party other than Seller has any rights to or in, or any
claims against, any of the Business IP owned by Seller. Neither the execution nor
delivery of this Agreement or the agreements contemplated by this Agreement, nor the
consummation of the transactions contemplated thereby, will, to Sellers knowledge,
conflict with or result in a breach of any license or material contract listed in Schedule
5.11 herein, nor infringe upon any intellectual property rights of any
person or entity.
| | ---- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

21.        Section
6.1 of the Agreement is hereby amended in its entirety to read as           follows:

| | 6.1 | Organization.
Qualmax is a corporation duly organized, validly existing, and in good standing under the
laws of the State of Delaware. Qualmax Sub is a company duly incorporated and validly
existing under the laws of the State of Israel. Buyer has the corporate power to own all
of its properties and assets and to carry on its business in all material respects as it
is now being conducted, and there is no jurisdiction in which it is not qualified in
which the character and location of the assets owned by it or the nature of the business
transacted by it requires qualification, except where the failure to be so qualified
would not reasonably be expected to have a material adverse effect on Buyer.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

22.        Section
6.4 of the Agreement is hereby amended to remove reference to the           Escrow
Agreement in the first sentence thereof.

23.        Section
6.5 of the Agreement is hereby amended by replacing the sentence           beginning with
the words Schedule 6.5 hereto and ending with           the words as
of the date hereof with the following new           sentence:

| | Schedule
6.5 hereto constitutes the share capitalization table of Qualmax on a
fully diluted basis, as of the Closing date.
| | ---------------------------------------------------------------------------------------------------------------------------

24.        Section
6.6 of the Agreement is hereby amended in its entirety to read as           follows:

| | 6.6 | Subsidiaries.
Buyer owns the following wholly owned subsidiaries:  IP Gear, Inc., a corporation
duly incorporated in the United States, and Qualmax Sub, a company incorporated in
Israel. Qualmax Sub is wholly owned by Qualmax. Buyer represents and undertakes that
Qualmax Sub has been established for the initial purpose of holding the Acquired Assets
and to conduct the Business, and that is free and clear of any and all liabilities and
encumbrances whatsoever.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

25.        Section
6.12 of the Agreement is hereby amended in its entirety to read as           follows:

| | 6.12 | Litigation
and Proceedings. Except for the Bosanova Litigation, there are no actions, suits, or
proceedings pending or, to the knowledge of Buyer, threatened by or against or affecting
Qualmax and/or Qualmax Sub, or their respective properties, at law or in equity, before
any court or other governmental agency or instrumentality, domestic or foreign, or before
any arbitrator of any kind, which would reasonably be expected to have a Buyer MAE.
| | ---- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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26.        Section
7.2 of the Agreement is hereby amended in its entirety to read as           follows:

| | 7.2 | Buyer
shall grant to Seller piggy-back registration rights with respect to (a) the Share
Consideration, including any Earn-Out Shares, issued and/or transferred to Seller
pursuant to this Agreement, (b) any Additional Buyer Stock actually issued by Buyer to
Seller pursuant to this Agreement, and (c) any Outsourcing Shares, as such terms are
defined in the Registration Rights Agreement attached hereto as Schedule 7.2 (collectively,
(a), (b) and (c) shall be referred to as the Registrable Securities),
all in accordance with the aforesaid Registration Rights Agreement to be executed by the
parties hereto at the Closing, such that if Buyer undertakes to register the resale of
shares of Buyer Stock held by any affiliates of Buyer, Buyer must allow Seller to have a
pro rata amount of Registrable Securities included in such registration statement. Said
registration rights shall also apply to any bonus shares and/or rights offerings and/or
similar distributions made by Buyer with respect to the Registrable Securities.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

27.        Section
8 of the Agreement is hereby amended as follows:

| | (a) | Sub-section
(ii) therein is hereby amended in its entirety to read as follows:
| | --- | ------------------------------------------------------------------------------

| | (ii)
such Affiliate Transaction, whether of Qualmax and/or Qualmax Sub, has been
          approved by a majority of the independent members of the Board of Directors of
          Qualmax, and if the Affiliate Transaction is that of Qualmax Sub, then by the
          Board of Directors of Qualmax Sub as well.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (b) | The
last sentence of Section 8 is hereby amended in its entirety as follows:
| | --- | ----------------------------------------------------------------------------

| | Notwithstanding
anything to the contrary herein, this Section 8 shall not prohibit: (x) any
reasonable employment agreement between Buyer and an executive officer of Buyer that is
approved (1) by a majority of the Board of Directors of Qualmax, or (2) if such executive
officer is a director, by a majority of the Board of Directors of Qualmax, excluding such
executive officer, for such agreements of both Qualmax and Qualmax Sub; (y) any
reasonable employment agreement or other compensation plan or arrangement paid or made
available to officers or employees of Buyer for services actually rendered or to be
rendered and entered into by Buyer in the ordinary course of business and consistent with
past practice; or (z) any transaction described on Schedule 8.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

28.        A
new Section 8A is hereby added after Section 8 to read as follows:

| | 8A.
          SELLER AND BUYER COVENANTS
| | ----------------------------------------

| | 8A.1 | Seller
Source Code. Within thirty (30) days following the Closing, Seller shall have
provided Buyer with all source codes for all software constituting Acquired Assets,
including current developments, in writing and/or burned onto CDs, as the case may be, as
well as any literature regarding such software (including without limitation, manuals and
white papers).
| | ---- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



---

---

| | 8A.2 | Assignment
of Contracts. Seller hereby undertakes to, immediately following the Closing, use its
best efforts to obtain any third party consent necessary for the assignment or transfer
of each material contract included in the Acquired Assets. If a required consent is not
obtained, or if an attempted assignment or transfer of a material contract would be
ineffective or would adversely affect the rights of Buyer thereunder so that Buyer would
not in fact receive all of the rights and benefits thereunder, Seller shall use its
commercially reasonable efforts jointly with Buyer to secure to Buyer the same economic
rights and benefits thereunder through a mutually agreeable alternate arrangement
(including subcontracting, sublicensing or subleasing to Buyer, or an arrangement under
which Seller would enforce for the benefit of Buyer, with Buyer assuming Sellers
obligations, any and all rights of Seller against a third party thereto). Seller will
promptly pay to Buyer when received all monies received by Seller under any such contract
or any claim or right or any benefit arising thereunder not transferred pursuant to this
Section 8A.2.
| | ---- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 8A.3 | Encryption
License. Seller hereby undertakes to use its best efforts to assist Buyer to obtain
or arrange for the assignment of the encryption license Seller has from the Ministry of
Defense of the State of Israel (the MoD). Attached hereto as Schedule
8A.3 is an email from the MoD stating that until Qualmax Sub obtains an
encryption license directly from the MoD, Qualmax Sub is permitted to continue the
development, production, integration, export, sale and distribution of the Bosanova Claro
product.
| | ---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 8A.4 | Non-Solicitation.
Commencing upon the Closing and during the five (5) year period immediately thereafter
(the Restriction Period), no Seller nor any of its respective
subsidiaries shall, directly or indirectly, solicit the employment of, assist in the
soliciting of the employment of, or otherwise solicit the association in business with,
any Hired Personnel, or induce any Hired Personnel to terminate such relationship, or to
join with Seller or any of their affiliates or any other person or entity for the purpose
of leaving the employ or such other relationship with Buyer.
| | ---- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 8A.5 | Non-Competition.
During the Restriction Period, neither BOScom nor Quasar nor any of its respective
subsidiaries shall, directly or indirectly, own, manage or control, or participate in the
ownership, management or control of, or be engaged by or otherwise affiliated or
associated as a consultant, independent contractor or otherwise with, any business or
entity that is engaged in activities that are competitive with the Business (any Competitor).
For purposes of clarity, any business or entity engaged exclusively in the Connectivity
business shall not be considered a Competitor. Notwithstanding this Section 8A.5 or
any other provision of this Agreement, BOScom and Quasar are permitted to collectively
own up to one percent (1%) of the outstanding capital stock or other equity interests of
any publicly-traded entity that is a Competitor.
| | ---- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 8A.6 | OCS
Royalties. Seller hereby agrees to pay to the OCS, and to prepare any required
reports related to, any royalty payments or other amounts, if any, owing to the OCS which
were due, accrued or relate to the period prior to the Closing Date.
| | ---- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 8A.7 | Issuance
of Stock. Qualmax hereby covenants to BOS that Qualmax shall issue any shares of Buyer
Stock that are required to be issued pursuant to the terms of the Outsourcing Agreement.
| | ---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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29.        Section
9.6 of the Agreement is hereby amended in its entirety to read as           follows:

| | 9.6 | [Reserved]
| | --- | ----------

30.        Section
9.7 of the Agreement is hereby amended in its entirety to read as           follows:

| | 9.7 | [Reserved]
| | --- | ----------

31.        [Reserved]

32.        Section
10.6 of the Agreement is hereby amended such that the words           Holdback
Shares are hereby replaced with the words Earn-Out           Shares.

33.        Section
10.10 of the Agreement is hereby amended in its entirety to read as           follows:

| | 10.10 | [Reserved]
| | ----- | ----------

34.        Section
10.11 of the Agreement is hereby amended in its entirety to read as           follows:

| | 10.11 | [Reserved]
| | ----- | ----------

35.        Section
10.12 of the Agreement is hereby amended such that reference to Exhibit           D is
hereby replaced with reference to Schedule 7.2.

36.        The
following is hereby added to the end of Section 13 of the Agreement:

| | In
addition to, and not in limitation of, the foregoing, Seller hereby agrees fully to
indemnify and hold harmless Buyer and its affiliates and their respective shareholders,
directors, officers and agents (in such capacities, collectively, the Buyer
Indemnified Parties) from and against all claims, losses, liabilities and
expenses which may be made or brought against the Buyer Indemnified Parties or which they
may suffer or incur, directly or indirectly, as a result of or in connection with the
Bosanova Litigation, provided however that, such indemnity shall only include (i) any
amounts ordered against the Buyer Indemnified Parties in any settlement approved in
writing by Seller or in any final judgment and (ii) reasonable legal fees and expenses
incurred by the Buyer Indemnified Parties in connection with such litigation.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Such
indemnification by Seller shall be subject to the following procedure:
| | ---------------------------------------------------------------------------

| | (a) | The
Buyer Indemnified Parties shall deliver to Seller without delay all
                    documents they receive or possess in connection with the Bosanova
Litigation.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (b) | Seller
shall be entitled to undertake the conduct of the defense of the Buyer
                    Indemnified Parties in respect of the Bosanova Litigation. At the
request of                     Seller, the Buyer Indemnified Parties shall cooperate with
Seller and execute                     all documents reasonably required to enable Seller
to conduct the defense in the                     name of the Buyer Indemnified Parties.
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



---

---

| | (c) | Seller
will have no liability or obligation under this indemnification
                    obligation for any amount expended by the Buyer Indemnified Parties
pursuant to                     any compromise or settlement agreement reached in
Bosanova Litigation without                     Sellers prior written consent to
such compromise or settlement.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | For
avoidance of doubt, the provisions of Section 15.11 herein shall apply to Sellers
obligation to indemnify the Buyer Indemnified Parties under this Section 13 in
connection with the Bosanova Litigation.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

37.        Section
15.10 of the Agreement is hereby amended in its entirety to read as           follows:

| | Further
Assurances. The parties agree, without any additional consideration, to take all
necessary measures and execute such other and further documents as may be necessary or
appropriate to give full force and effect to the transaction contemplated herein. Without
derogating from the generality of the foregoing or from any of the provision set forth
hereunder, the parties agree that the aforesaid commitment shall continue to apply after
the Closing and the Seller undertakes to perform any additional post-Closing action, to
effectuate the Buyers title and interest in the Acquired Assets, to retain the
Hired Personnel and to deliver and comply with any post-Closing deliverable hereunder.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

38.        The
list of Exhibits and Schedules at the end of the Agreement is hereby deleted           in
its entirety.

39.        Except
as amended hereby, the Agreement shall continue in full force and effect,           and
each party hereto hereby confirms its agreement to the Agreement as amended           by
this Amendment.

40.        This
Amendment may be executed in two or more counterparts, each of which shall           be
deemed an original, but all of which shall together constitute one and the           same
instrument.

# [Signature page follows
immediately]



---

---

IN
WITNESS WHEREOF, the parties hereto have executed, or have caused this Amendment to be
executed by their respective duly authorized officers, as of the date first above-written.

| |  | QUALMAX, INC.By: 
Name: __________________________Title: ___________________________
| |  | -----------------------------------------------------------------------------------------------------

| |  | QUALMAX LTD.By: 
Name: __________________________Title: ___________________________
| |  | ----------------------------------------------------------------------------------------------------

| |  | BOSCOM LTD.By: 
Name: __________________________Title: ___________________________
| |  | ---------------------------------------------------------------------------------------------------

| |  | B.O.S. BETTER ONLINE SOLUTIONS LTD.By: 
Name: Adiv Baruch     Nehemia KaufmanTitle:           CEO
                     CFO
| |  | -------------------------------------------------------------------------------------------------------------------------------------------

| |  | QUASAR TELECOM (2004) LTD.By: 
Name: __________________________Title: ___________________________
| |  | ------------------------------------------------------------------------------------------------------------------



---

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# LOAN AGREEMENT

THIS
LOAN AGREEMENT (the Agreement) is made as of the 31st day of December,
2005 (the Effective Date), by and among B.O.S. Better Online Solutions
Ltd. (the Lender), a company organized under the laws of the State of
Israel, with its principal offices located at Beit Rabin, Teradyon, Misgav 20179, Israel,
and Qualmax Ltd. (the Borrower), an Israeli Company, with its
registered offices located at c/o Shibolet, Yisraeli, Roberts, Zisman and Co., Adv., 46
Montifiore St., Tel-Aviv 65201, Israel.

W I T N E S S E T H:

WHEREAS,
Borrower and Lender have entered into an Asset Purchase Agreement dated October 26, 2005,
as amended from time to time pursuant to which Borrower is acquiring from Lender the
communications solutions business of Lender (the APA);

WHEREAS,
as a condition to the closing of the APA, Borrower must receive a bridge financing in the
amount of at least US$1,000,000;

WHEREAS,
in order to facilitate the closing of the APA, Lender has agreed to extend to Borrower a
loan in the amount of US$1,000,000 on the terms and conditions set forth herein; and

WHEREAS,
Borrower desires to receive such loan from Lender on the terms and conditions set forth
herein;

NOW
THEREFORE, the parties hereto hereby agree as follows:

1.    
          Loan; Interest.

1.1        Lender
shall lend to Borrower an aggregate amount of US$1,000,000 (the Loan Amount).
The Loan Amount shall bear and accrue interest at a rate per annum (the Interest
Rate) equal to the prime rate published on The Wall Street Journal
from time to time, plus two and a half percent (2.5%), but no more than twelve percent
(12%). The Interest Rate shall be increased or decreased, as the case may, be for each
increase or decrease in the prime rate in an amount equal to such increase or decrease in
the prime rate; each change to be effective as of the day of the change in such rate.
Interest on the Loan Amount shall be calculated on the basis of a 360-day year. The
amount accrued as interest on the Loan Amount at the Interest Rate is referred to herein
as the Interest. Interest shall accrue from the date of Closing of
this Agreement and until the full repayment of the Loan Amount by Borrower in accordance
with the terms of this Agreement. Collectively, the Loan Amount and the Interest shall be
referred to in this Agreement as the Loan.

1.2        At
the Closing Lender shall transfer the Loan Amount to a bank account in the name of
Qualmax Ltd. (or on its behalf and for its benefit) in Israel, according to the details
to be provided in a written notice by Borrower prior to the Closing.

1.3        Borrower
shall use the Loan Amount exclusively for the financing and operation of the Business,
as defined in the APA. For the avoidance of doubt, no part of the Loan Amount shall be
used to pay management fees to Qualmax Inc. (Qualmax) nor shall it be
transferred to any of Qualmaxs affiliates.



---

---

2.    
          Payments.

2.1        Interest
Payments.

Interest
shall be payable monthly, in arrears, commencing on January 1, 2006 and on the first
Business Day (as defined below) of each consecutive calendar month thereafter until the
Final Repayment Date (and on the Final Repayment Date), whether by acceleration or
otherwise (each, a Repayment Date).

The
date, on which the last payment under this Agreement is due and payable by Borrower, shall
be referred to as the Final Repayment Date.

2.2        Monthly
Principal Payments. Amortizing payments of the aggregate outstanding Loan Amount at
any time (the Principal Amount) shall begin on July 1, 2007 and shall
recur on the first Business Day (as defined below) of each succeeding month thereafter
until the Final Repayment Date, all as set forth in the table below:

|Date     | Principal Amount | Date     | Principal Amount
|-------- | ---------------- | -------- | ----------------
|1-Jul-07 | $ 55,556         | 1-Apr-08 | $ 55,555        
|1-Aug-07 | $ 55,556         | 1-May-08 | $ 55,555        
|1-Sep-07 | $ 55,556         | 1-Jun-08 | $ 55,555        
|1-Oct-07 | $ 55,556         | 1-Jul-08 | $ 55,555        
|1-Nov-07 | $ 55,556         | 1-Aug-08 | $ 55,555        
|1-Dec-07 | $ 55,556         | 1-Sep-08 | $ 55,555        
|1-Jan-08 | $ 55,556         | 1-Oct-08 | $ 55,555        
|1-Feb-08 | $ 55,556         | 1-Nov-08 | $ 55,555        
|1-Mar-08 | $ 55,556         | 1-Dec-08 | $ 55,556        

All
payments by Borrower to Lender made under this Agreement shall be subject to withholding
tax as prescribed under Israeli law, unless Lender shall provide Borrower, prior to any
payment hereunder, with the authorization of the Israeli income tax commission to act
otherwise. In the event that any payment on account of the Loan is subject to Israeli VAT,
such VAT shall be paid by the Borrower against receipt of a valid VAT invoice.

All
payments by Borrower to Lender made under this Agreement shall be made on a Business Day
(as defined herein) in accordance with the provision of this Section 2. For purposes of
this Agreement, the term Business Day means any day on which banks in
Israel are open and execute foreign exchange transactions.

All
payments to Lender by Borrower, to be made under this Agreement shall be made to
Lenders bank account as follows:

| | United Mizrahi Bank Ltd. (Bank# 20) 
Haifa Business Center, City Wind Brosh Building 
2 Palyam St. Haifa, Israel (Branch# 444) 
Swift Code: MIZBILIT 
Account#: 20-44-125542 Attn. Alice B. 
Phone: 972-4-658207 Fax: 972-4-8622012
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

2

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or
to such other bank account details to be provided by Lender to Borrower in writing.

2.3        Repayment
in Borrower Stock. Notwithstanding the foregoing obligations of repayment of Borrower
as set forth in this Section 2, if in the first fiscal quarter of 2006, the Royalty Base
Business (as defined in Section 3.1.2 of the APA) operated in accordance with the budget
agreed to between the Lender and the Borrower, generates losses which exceed US$250,000,
then Borrower shall be entitled to make any payments due hereunder to the extent of the
amount of losses over said US$250,000 (the Excess Losses) in shares of
Common Stock of Qualmax (the Borrower Stock) in lieu of cash. For
purposes of this Section 2.3, each share of Borrower Stock shall be valued at US $1.43
(subject to appropriate adjustment in the event of any stock dividend, stock split,
subdivision, combination, recapitalization, reorganization, reclassification,
consolidation or like occurrence or event, the Borrower Stock Price).
It is expressly agreed that as a condition precedent to any determination regarding
Excess Losses hereunder, the Excess Losses must be reviewed and certified by an
independent accounting firm reasonably acceptable to the Lender.

2.4        Default
Interest on Late Payments. Without derogating from any rights or remedies afforded by
law, any delay of more than fifteen (15) days in the payment of any amount due to Lender
from Borrower on account of the Loan or otherwise due pursuant to the provisions of this
Agreement shall subject such amounts to additional interest which shall accrue thereon at
an annual rate of five and one-half percent (5.5%) from the date on which such payment
has become due and until actual payment thereof. Such default interest shall be
compounded daily.

2.5        Prepayment.
Notwithstanding the provisions of this Agreement, Borrower may, without penalty, prepay
any and all amounts due to Lender on account of the Loan, at any time prior to the Final
Repayment Date, provided that, Borrower delivers to Lender written notice, at least 30
days prior to the scheduled repayment date, and provided, further, that the prepayment is
in an amount of all outstanding amounts then due and payable to Lender pursuant to this
Agreement including accrued interest fees and default payments, if any.

2.6        Mandatory
Repayment. Notwithstanding anything to the contrary in this Agreement, Borrower shall
repay to Lender the Loan, immediately following an event of Qualifying Financing. Qualifying
Financing shall be deemed to have occurred as soon as the Borrower has raised,
by way of equity financing (or a series of equity financings) an aggregate amount equal
to at least US$4,500,000. Borrower shall notify Lender, in writing, promptly upon the
occurrence of a Qualifying Financing.

2.7        Issuance
of Borrower Stock Certificates. Any Borrower Stock to be issued pursuant to this
Agreement shall be issued by Qualmax, and any certificates evidencing such Borrower Stock
shall be issued no later than fifteen (15) business days following the time such Borrower
Stock is required to be issued in accordance with the provisions of this Agreement and/or
the Warrant.

2.8        Registration
Rights. Any and all Borrower Stock issued by Qualmax pursuant to this Agreement and
the Warrant shall be restricted stock and subject to incidental registration rights, as
more fully provided in the Registration Rights Agreement of even date hereof, entered
into between the Lender and Qualmax.

3

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3.    
          Closing.

3.1        The
closing of the transaction hereunder shall take place on the date of Closing of the APA
at such time and place as shall be agreed between the parties (the Closing).

3.2        At
the Closing, and as a condition to Lenders obligation to provide the Loan Amount,
Borrower shall provide the Lender with:

| | (a) | a
copy of the resolutions of the directors of Borrower duly authorizing the
               execution and performance by Borrower of this Agreement, and the Pledge
               Agreement (as defined in Section 9 below);
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (b) | a
copy of the resolutions of the directors of Qualmax duly authorizing the
               execution of this Agreement, the provision of the Guarantee (as defined
below)                and the issuance of the Warrant referred to in Section 8 below;
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (c) | to
the extent necessary and applicable, all consents, approvals and waivers
               which may be required from any third party;
| | --- | --------------------------------------------------------------------------------------------------------------------------------------

| | (d) | confirmation
of Borrowers officer that no other action, consent or                approval is
required to sign, deliver and perform this Agreement, the Pledge                Agreement
and all transactions contemplated hereunder;
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (e) | an
originally-executed, validly issued Warrant certificate in accordance with
               Section 8 below;
| | --- | -------------------------------------------------------------------------------------------------------------

| | (f) | a
copy, or copies, of the duly-executed Pledge Agreement and corresponding
               pledge notice to the Israeli Registrar of Companies, as more fully
described in                the Pledge Agreement, which materials shall be ready for
immediate filing                therewith (the Pledge).
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

3.3        The
obligations of Lender at the Closing and thereafter are subject to the fulfillment at or
before Closing of the following conditions precedent: (i) the representations and
warranties made by Borrower herein shall be true and correct as of the Closing; (ii) all
covenants to be performed by Borrower prior to or at the Closing shall have been
performed or complied with prior to or at the Closing; and (iii) Borrower shall have
secured all permits, consents and authorizations necessary or required lawfully for the
execution and consummation of this Agreement, the Warrant referenced herein and the
Pledge Agreement. It is hereby agreed that the Lender may, at its discretion, waive the
requirement of any of the abovementioned items.

4.    
          Events of Acceleration.

4.1        If
any of the events specified in this Section 4 shall occur (each, an Event of
Acceleration), the entire Loan Amount, together with any Interest then due
thereon, shall be immediately due and payable:

4

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| | (a) | Failure
to Pay Principal, Interest or other Fees. The                Borrower (i)
fails to pay when due any installment of principal, interest or                other fees
hereon in accordance herewith, or (ii) the Borrower fails to pay when                due
any amount exceeding $100,000 due under any other promissory note issued by
               Borrower (unless the Borrower shall in good faith contest the validity of
such                amounts), and in any such case, such failure shall continue for a
period of                thirty (30) days following the date upon which any such payment
was due.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (b) | Breach
of Covenant. The Borrower breaches any covenant or                any
other term or condition of this Agreement or the Borrower and/or Qualmax
               breaches the provisions of Section 3.1.2 of the APA regarding the Royalty
               Consideration (as defined in the APA) in any material respect, or the
Borrower                breaches any covenant or any other term or condition of any
Related Agreement                (as defined herein) in any material respect and, in any
such case, such breach,                if subject to cure, continues for a period of
thirty (30) days after the                occurrence thereof. Related Agreement shall
mean any of the                Warrant and the Pledge Agreement entered into by and
between the Borrower and                the Lender.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (c) | Breach
of Representations and Warranties. Any                representation or
warranty made by the Borrower in this Agreement, or any                Related Agreement,
shall, in any such case, be false or misleading in any                material respect on
the date that such representation or warranty was made or                deemed made,
provided that if such breach is subject to cure, it shall not have                been
cured for a period of thirty (30) days of written notice.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (d) | Receiver
or Trustee. The Borrower shall make an assignment                for the
benefit of creditors, or apply for or consent to the appointment of a
               receiver or trustee for it or for a substantial part of its property or
               business; or such a receiver or trustee shall otherwise be appointed,
provided                such proceeding is not revoked within forty-five (45) days.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (e) | Judgments.
Any money judgment, writ or similar final                process shall be entered or
filed against the Borrower or any of its                subsidiaries or any of their
respective property or other assets for more than                $100,000, and shall
remain unvacated, unbonded or unstayed for a period of                ninety (90) days.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

5

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| | (f) | Bankruptcy.
Bankruptcy, insolvency, reorganization or                liquidation proceedings or other
proceedings or relief under any bankruptcy law                or any law for the relief
of debtors shall be instituted by or against the                Borrower or any of its
subsidiaries and such proceedings, shall continue                undismissed or unstayed
for ninety (90) business days. It is hereby clarified                that any cure
periods in this Section 4.1 shall not be cumulative to the                aforementioned
ninety (90) business days.
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (g) | Failure
to Deliver Shares of Common Stock. The Borrower                shall fail
to timely deliver shares of Borrower Stock pursuant to and in the                form
required by this Agreement or the Warrant, if such failure shall not be
               cured within fifteen (15) Business Days.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (h) | Default
Under Related Agreements or Other Agreements. The occurrence and
               continuance of any material event of default (or similar term) by Borrower
under                any other material indebtedness of the Borrower in excess of
$200,000, which                default is not cured during the applicable cure period
provided therein. Lender                shall give Borrower fifteen (15) business days
advance notice prior to calling                for the repayment of the entire Loan
Amount hereunder.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

4.2        Without
limitation to the provisions of Section 4.1 above, upon the occurrence of an Event of
Acceleration described in Section 4.1(a)  (h) above, the Lender may, at its sole
discretion, elect to receive, in full satisfaction of the Default Amount (as
defined below), and in lieu of calling in the Loan for immediate repayment in accordance
with the provisions of Section 4.1 above, Borrower Stock in such number equal to the
quotient obtained by dividing (a) the amount of repayment of Loan defaulted (the Default
Amount) plus fifty percent (50%) of such Default Amount, by (b) the Borrower
Stock Price.

5.    Required
Approvals. For so long as twenty-five percent                (25%) of the
principal amount of the Loan is outstanding, the Borrower, without                the
prior written consent of the Lender, shall not:

| | (a) | directly
or indirectly declare or pay any dividends;
| | --- | ----------------------------------------------------

| | (b) | liquidate,
dissolve or effect a material reorganization provided, however, that                the
Borrower may merge or effect a material reorganization if the Borrower is
               the surviving entity;
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (c) | become
subject to (including, without limitation, by way of amendment to or
               modification of) any agreement or instrument which by its terms would
(under any                circumstances) restrict the Borrowers right to perform
the provisions of                this Agreement, any Related Agreement or any of the
agreements contemplated                hereby or thereby; or
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

6

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| | (d) | cancel
any debt owing to it in excess of $500,000 in the aggregate during any 12
               month period.
| | --- | -------------------------------------------------------------------------------------------------------------

6.    Representations
and Warranties of Borrower. The Borrower                hereby represents
and warrants to the Lender as of immediately prior to the                Closing, as
follows:

6.1.        Borrower
is a company duly organized and validly existing under the laws of the
               State of Israel, and has the power to own and lease its properties and to
carry                on its business as now being conducted.

|6.2.        Borrower
has full power and authority to consummate the transactions                contemplated
hereunder and under the Pledge Agreement. Except as set forth on Schedule 6.2 hereof
or as shall be obtained                prior to the Closing, no consents, authorizations
or approvals of any kind of                any governmental authority, shareholder,
holder of any other interest in the                Borrower or other third party are
required in connection with the execution or                performance of this Agreement
and/or the Pledge Agreement by the Borrower. The                consummation of the
transactions contemplated hereunder, and the performance of                this Agreement
and the Pledge Agreement by the Borrower, do not violate the                provisions of
any applicable law, and will not result in any material breach of,                or
constitute a material default under, any material agreement or material
               instrument to which it is a party or under which it is bound, except as
would                not result in a Borrower MAE (as defined below). The execution and
performance                of this Agreement and the Pledge Agreement by the Borrower
have been duly                authorized by all necessary action, and this Agreement and,
as of the Closing,                has been (or, by the Closing, will have been) duly
executed and delivered by the                Borrower. This Agreement and the Pledge
Agreement are legal, valid, and binding                obligations of the Borrower and
they are enforceable as to the Borrower in                accordance with their
respective terms except as the enforceability hereof and                thereof may be
limited by applicable bankruptcy, insolvency, reorganization,                moratorium
or similar laws affecting the enforcement of creditors rights
               generally, by general equitable principles (whether enforcement is sought
by                proceedings in equity or at law) and an implied covenant of good faith
and fair                dealing.
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

6.3        There
are no outstanding legal proceedings (including arbitration and mediation proceedings)
against or initiated by the Borrower or a subsidiary thereof that would be reasonably
likely to have a material adverse effect on the business, operations, properties,
prospects or conditions of Borrower, taken as a whole (a Borrower MAE),
and the Borrower is not aware of any legal proceedings that any third parties intend or
threaten to initiate against the Borrower and/or a subsidiary thereof that would be
reasonably likely to result in a Borrower MAE.

6.4        Neither
the Borrower nor any subsidiary thereof has any material contingent liabilities, except
current liabilities incurred in the ordinary course of business and liabilities disclosed
in the Schedules to the APA that would be reasonably likely to result in a Borrower MAE.

6.5        Except
as set forth on the Schedules to the APA there are no agreements, understandings,
instruments, contracts, judgments, orders, writs or decrees to which the Borrower is a
party or by which it is bound which may involve: (i) obligations (contingent or
otherwise) of the Borrower in excess of $500,000 (other than obligations arising from
purchase or sale agreements entered into in the ordinary course of business); or (ii)
provisions restricting the development, manufacture or distribution of the Borrowers
products or services.

7

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6.6        Except
as set forth on the Schedules to the APA, the Borrower has good and marketable title to
its material properties and assets, and good title to its material leasehold estates, in
each case subject to no mortgage, pledge, lien, lease, encumbrance or charge, other than:

| | (a) | those
resulting from taxes which have not yet become delinquent;
| | --- | ----------------------------------------------------------------

| | (b) | minor
liens and encumbrances which do not materially detract from the value of
               the property subject thereto or materially impair the operations of the
               Borrower; and
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (c) | those
that have otherwise arisen in the ordinary course of business.
| | --- | --------------------------------------------------------------------

6.7        Neither
the execution and the delivery of this Agreement nor the consummation of the transactions
contemplated hereby, will (i) violate any constitution, statute, regulation, rule,
injunction, judgment, order, decree, ruling, charge, or other restriction of any
government, governmental agency, or court, or any stock exchange or quotation system, to
which Borrower is subject or any provision of the certificate of incorporation, bylaws or
analogous instruments of Borrower, or (ii) conflict with, result in a breach of,
constitute a default under, result in the acceleration of, create in any party the right
to accelerate, terminate, modify, or cancel, or require any notice under any agreement,
contract, lease, license, instrument, or other arrangement to which Borrower is a party
or by which it is bound or to which any of its assets is subject, except where the
violation, conflict, breach, default, acceleration, termination, modification,
cancellation, failure to give notice, or encumbrance would not reasonably be expected to
result in a Borrower MAE; or (iii) result in the imposition of any lien or other
encumbrance upon any of Borrowers assets, other than the Pledge and except for any
lien or encumbrance that would not reasonably be expected to result in a Borrower MAE.

6.8        Borrower
has no liabilities with respect to the payment of any taxes (including any deficiencies,
interest, or penalties), except for taxes accrued but not yet due and payable, for which
Borrower may be liable in its own right, or as a transferee of the assets of or as a
successor to, any other corporation or entity. Borrower has filed all income tax returns
required to be filed by it from inception to the date hereof. All such returns are
complete and accurate in all material respects.

6.9        Borrower
has all licenses, franchises, permits, and other government authorizations, that are
legally required to enable it to conduct its business operations in all material respects
as conducted on the date hereof, except to the extent that failure to obtain same would
not reasonably be expected to result in a Borrower MAE. Except for compliance with
federal and state securities or corporation laws, as hereinafter provided, no
authorization, approval, consent, or order of, or registration, declaration, or filing
with, any court or other governmental body, or any stock exchange or quotation system, is
required in connection with the execution and delivery by Borrower of this Agreement and
the consummation by Borrower of the transactions contemplated hereby. Borrower has
complied with all applicable statutes and regulations of any federal, state, Israeli or
other applicable governmental entity or agency thereof, and with all applicable rules of
any stock exchange or quotation system, except to the extent that noncompliance would not
reasonably be expected to result in a Borrower MAE.

8

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7.    
          Representations and Warranties of Lender. The Lender hereby
          represents and warrants to the Borrower as follows:

7.1.        Lender
is a corporation duly incorporated and validly existing under the laws of           the
State of Israel, and has the power to own and lease its properties and to           carry
on its business as now being conducted.

7.2.        Lender
has full power and authority to consummate the transactions contemplated
          hereunder. Except as set forth on Schedule           7.2 hereof
or as shall be obtained prior to Closing,           no consents, authorizations or
approvals of any kind of any governmental           authority, shareholder, holder of any
other interest in the Lender or other           third party are required in connection
with the execution or performance of this           Agreement by the Lender. The
consummation of the transactions contemplated           hereunder, and the performance of
this Agreement by the Lender, do not violate           the provisions of any applicable
law, and will not result in any material breach           of, or constitute a material
default under, any material agreement or material           instrument to which it is a
party or under which it is bound, except as would           not have a material adverse
effect on the business, operations, properties,           prospects or conditions of the
Lender and its subsidiaries, taken as a whole.           The execution and performance of
this Agreement by the Lender have been duly           authorized by all necessary action,
and this Agreement and, as of the Closing,           has been (or, by the Closing, will
have been) duly executed and delivered by the           Lender. This Agreement is the
legal, valid, and binding obligation of the Lender           and it is enforceable as to
the Lender in accordance with its respective terms           except as the enforceability
hereof may be limited by applicable bankruptcy,           insolvency, reorganization,
moratorium or similar laws affecting the enforcement           of creditors rights
generally, by general equitable principles (whether           enforcement is sought by
proceedings in equity or at law) and an implied           covenant of good faith and fair
dealing.

8.    
          Warrant. In further consideration for advancing the Loan
          Amount, the Lender shall be granted, at the Closing, a warrant to purchase
          107,143 shares of Borrower Stock (the Warrant) pursuant to the terms
          of a warrant in the form attached hereto as Schedule
          7. The Warrant to be issued to the Lender at the
          Closing pursuant to this Section 8 shall remain in effect in accordance with its
          terms, notwithstanding any conversion, acceleration, or the repayment of the
          Loan.

9.    
          Pledge.

9.1        In
order to secure the fulfillment of all of Borrowers obligations hereunder, the
Borrower shall, at the Closing, pledge in favor of Lender, by way of first-priority
floating charge all of its properties, assets and rights, including the Acquired Assets
(as defined in the APA). The pledge shall be governed by a floating charge and debenture
agreement in the form attached hereto as Schedule 9 (the Pledge
Agreement), which shall be executed by Borrower, on or prior to the Closing.
The Pledge shall be registered with the Israeli Registrar of Companies, by filing the
necessary forms therewith, promptly following the Closing. The Borrower shall fully
cooperate with the Lender and execute all documents as may be necessary to effect the
Pledge, and the Borrower and Lender shall equally bear any applicable stamp taxes and/or
registration fees.

9

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9.2        Lender
agrees that the Pledge shall rank junior and be subordinated to a charge or any other
security interest in favor of Bank of America, N.A. (BoA), if and to the
extent such charge or any other security interest (the Charge) is mandated
pursuant to the Business Loan Agreement dated April 20, 2005, as amended between Qualmax
and BoA, and provided that the Charge is recorded with the Israeli Registrar of
Companies. Lender shall cooperate with Borrower for the purpose of facilitating the
registration of the Charge under the circumstances provided above. The provisions of this
Section 9.2 shall serve as Lenders consent to the registration of the Charge.
Nothing herein shall be deemed to otherwise derogate from the Lenders rights
pursuant hereunder and under the Pledge.

10.     Miscellaneous.

10.1        Furtherance
of Cooperation. Each of the parties hereto shall perform such further acts and
execute such further documents as may reasonably be necessary to carry out and give full
effect to the provisions of this Agreement and the intentions of the parties as reflected
thereby.

10.2        Reports.
Borrower undertakes to provide Lender with: (i) audited, US dollar-denominated annual
financial statements, according to the US or Israeli GAAP, within ninety (90) days after
the end of each fiscal year; (ii) unaudited, US dollar-denominated quarterly
financial statements, according to the US or Israeli GAAP, within sixty (60) days of the
end of each fiscal quarter. Borrower and Qualmax shall promptly following Lenders
written request, and subject to any applicable rule and regulation, provide the Lender
with a detailed cap table reflecting Borrowers and/or Qualmaxs share capital
and such other information as may be required to allow Lender to comply with
any applicable rule or regulation, in the United States and Israel, including
without limitation, rules of the SEC, Nasdaq, the Israeli Securities Authority and the
Tel-Aviv Stock Exchange. Qualmax shall provide the Lender with its annual and quarterly
financial statements promptly after filing of these documents with the SEC.

10.3        Governing
Law. This Agreement shall be deemed to have been executed and delivered in the State
of New York, and the validity, enforcement and construction hereof shall be governed in
all respects by the internal laws (without regard to principles of conflicts of law) of
the State of New York. Any legal action or proceeding arising under or in relation to
this Agreement shall be brought exclusively in a federal or state court of competent
jurisdiction within the State and County of New York. In addition, each of the
undersigned parties consents and agrees that any court in which such legal action or
proceeding is commenced may exercise jurisdiction over his, her or its person for
purposes of enforcing the terms of this Agreement and agrees not to assert that venue in
New York is inappropriate or inconvenient. Notwithstanding the above, any action related
to the realization of the Pledge, including, without limitation, a motion for related
interim and/or temporary orders, may be adjudicated under Israeli law (without regard to
principles of conflicts of law) in the competent courts of Tel Aviv- Jaffa, Israel.

10

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10.4        Assigns
and Successors. Except as otherwise expressly limited herein, the provisions hereof
shall inure to the benefit of, and be binding upon, the successors, assigns, heirs,
executors, and administrators of the parties hereto. None of the rights, privileges, or
obligations set forth in, arising under, or created by this Agreement may be assigned or
transferred by either party without the prior consent in writing of the other party,
provided, however, that the Borrowers consent shall not be required with respect to
any assignment, delegation or transfer of the rights and obligations of this Agreement by
the Lender. The transfer of rights and obligations by Lender shall be contingent upon the
transferee thereof undertaking in writing to assume all obligations of the Lender (in its
capacity as a Lender) under this Agreement.

10.5        Entire
Agreement. This Agreement, together with the Schedules and Exhibits hereto constitute
the full and entire understanding and agreement among the parties with regard to the Loan
to Borrower hereunder and supersede all prior agreements among the parties hereof with
regard to such subject matters.

10.6        Amendment.
This Agreement may not be amended, supplemented, discharged, terminated or altered except
by a writing signed by the Borrower and Lender.

10.7        Preamble.The preamble hereto constitutes an integral part hereof.

10.8        Notices.
All notices, demands and other communications hereunder shall be in writing or by written
telecommunication, and shall be deemed to have been duly given if delivered personally or
if mailed by certified or registered mail, return receipt requested, postage prepaid, or
if sent by overnight courier, all to the following addresses:

| | If
to the Lender, to:
| | ---------------------

| | B.O.S. Better Online Solutions Ltd. 
Beit Rabin, Teradyon, Misgav 
Attn: Adiv Baruch, CEO and Nehemia Kaufman, CFO
| | ------------------------------------------------------------------------------------------------------------------

| | with
a copy sent contemporaneously to:
| | --------------------------------------

| | Amit, Pollak, Matalon & Co. 
NYP Tower - 19th Floor 
17 Yitzhak Sadeh Street 
Tel Aviv, 67775, Israel 
Attn: Shlomo Landress, Adv.
| | ----------------------------------------------------------------------------------------------------------------------------------

| | If
to the Borrower, to:
| | -----------------------

| | Qualmax, Ltd. 
C/O Shibolet, Yisraeli, Roberts, Zisman and Co., Adv 
44 Montifiore St., Tel-Aviv 65201, Israel 
Attn:  Ofer Manor, Adv.
| | ---------------------------------------------------------------------------------------------------------------------------------------

11

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| | with
copies sent contemporaneously to:
| | --------------------------------------

| | 1. Qualmax, Inc. 
340 West Fifth Avenue, 
Eugene, Oregon 97401, USA 
Attn: Mr. M. David Kamrat; and
| | ---------------------------------------------------------------------------------------------------

| | 2. Kramer Levin Naftalis & Frankel LLP 
1177 Avenue of the Americas 
New York, New York  10036 
Attn:  Scott S. Rosenblum, Esq.
| | -------------------------------------------------------------------------------------------------------------------------------

Any
such notice shall be effective (a) if delivered personally, when received, and (b) if sent
by reputable courier, on the date of delivery by such courier, and if delivery or
transmission is not made on a business day, on the immediately following business day.

10.9        Waiver.
No delay or omission to exercise any right, power, or remedy accruing to any party upon
any breach or default under this Agreement, shall be deemed a waiver of any other breach
or default theretofore or thereafter occurring. Any waiver, permit, consent, or approval
of any kind or character on the part of any party of any breach or default under this
Agreement, or any waiver on the part of any party of any provisions or conditions of this
Agreement, must be in writing and shall be effective only to the extent specifically set
forth in such writing. All remedies, either under this Agreement or by law or otherwise
afforded to any of the parties, shall be cumulative and not alternative.

10.10        Severability.
If any provision of this Agreement is held by a court of competent jurisdiction to be
unenforceable under applicable law, then such provision shall be excluded from this
Agreement and the remainder of this Agreement shall be interpreted as if such provision
were so excluded and shall be enforceable in accordance with its terms; provided,
however, that in such event this Agreement shall be interpreted so as to give
effect, to the greatest extent consistent with and permitted by applicable law, to the
meaning and intention of the excluded provision as determined by such court of competent
jurisdiction.

10.11        Damages.
NEITHER PARTY OR ITS AFFILIATES SHALL BE LIABLE TO THE OTHER PARTY OR ITS AFFILIATES
UNDER THIS AGREEMENT FOR OR IN RESPECT OF ANY PUNITIVE, SPECIAL, INDIRECT, EXEMPLARY
INCIDENTAL OR CONSEQUENTIAL LOSS OR DAMAGES (INCLUDING BUT NOT LIMITED TO LOST PROFITS)
OF ANY KIND WHATSOEVER, WHETHER BASED UPON THEORIES OF CONTRACT, NEGLIGENCE, TORT OR
OTHERWISE, AND EVEN IF SUCH PARTY KNEW OF THE POSSIBILITY OR LIKELIHOOD OF THE POTENTIAL
FOR SUCH DAMAGES.

10.12        Taxes.
Borrower shall bear, pay and discharge all stamp, documentary, registration or other like
duties or taxes, including any penalties, additions, fines, surcharges or interest
relating to those duties and taxes, which are imposed or chargeable on or in connection
with this Agreement and the Pledge Agreement and any document in connection therewith,
provided however that Israeli stamp duty, to the extent applicable, shall be equally
borne and paid by both parties.

12

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10.13        Survival.
Without derogating from the above, all covenants made in this Agreement shall continue to
remain in full force and effect for so long as this Agreement remains in effect pursuant
to its terms.

10.14        Counterparts.
This Agreement may be executed in one or more counterparts, each of which shall be deemed
an original, but all of which together shall constitute one and the same instrument.

# [Signatures Page
Immediately Follows]

13

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IN WITNESS WHEREOF, the
parties have signed this Agreement in one or more counterparts as of the date first
appearing above.

|B.O.S BETTER ONLINE SOLUTIONS LTD.
Name: __________________Title: __________________ | QUALMAX LTD.
Name: __________________Title: __________________
|-------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------

The undersigned, Qualmax, having full
power and authority to do so, hereby:

|1. | agrees, to the extent applicable, to deliver to Seller the Borrower Stock
          pursuant to Sections 2.3 and 4.2 of the Agreement; and
|-- | ------------------------------------------------------------------------------------------------------------------------------------------

|2. | irrevocably and unconditionally guarantees the payment by the Borrower of the
          Loan and Interest hereunder (the Guarantee). This Guarantee is in
          addition to any other security granted to Lender, and shall remain in effect
          until the Borrowers indebtedness is discharged in full. Qualmax expressly
          agrees that Lender shall not be required to exhaust its remedies against the
          Borrower prior to demanding performance by Qualmax hereunder.
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Qualmax represents that section 6.7
above applies to Qualmax, mutatis mutandis, with respect to the provision of the
Guarantee.

|QUALMAX, INC.
Name: __________________Title: __________________ |  | 
|----------------------------------------------------------------------------- |  | 

[Schedules omitted]

14

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# REGISTRATION RIGHTS
AGREEMENT

This
Registration Rights Agreement (this "Agreement") is made and entered into as of
December 31, 2005, by and between Qualmax, Inc, a Delaware corporation (the "Company")
and B.O.S. Better Online Solutions Ltd., an Israeli corporation ("BOS").

This
Agreement is made pursuant to the Asset Purchase Agreement, dated as of October 26, 2005,
by and between BOS and the Company, as amended from time to time (the Asset
Purchase Agreement) and pursuant to the Loan Agreement and the Outsourcing
Agreement (each, as defined below).

The
Company and BOS hereby agree as follows:

1.        Definitions.
Capitalized terms used and not otherwise defined herein that           are defined in the
Asset Purchase Agreement shall have the meanings given to           such terms in the
Asset Purchase Agreement. As used in this Agreement, the           following terms shall
have the following meanings:

| | Commission means
the Securities and Exchange Commission.
| | ----------------------------------------------------------

| | Common
Stock means the Companys shares of Common Stock, US$0.001 par value per
share.
| | ----------------------------------------------------------------------------------------

| | Company
Affiliate means any person, directly or indirectly, controlling or controlled
by or under common control with the Company, including without limitation any shareholder
of the Company holding at the date hereof 10% or more of the Companys issued and
outstanding share capital. For the purpose of this definition control as used
with respect to any person, shall mean the possession, directly or indirectly, of the
power to direct or cause the direction of the management or policies of such person,
whether through the ownership of voting securities or by agreement or otherwise.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Discontinuation
Event shall mean (i) when the Commission notifies the Company that there will
be a review of such registration statement and whenever the Commission
comments in writing on such registration statement (the Company shall provide true and
complete copies thereof and all written responses thereto to the Holder); (ii) any
request by the Commission or any other Federal or state governmental authority for
amendments or supplements to such registration statement or prospectus or for additional
information; (ii) the issuance by the Commission of any stop order suspending the
effectiveness of any registration statement covering any or all of the Registrable
Securities or the initiation of any Proceedings for that purpose; (iv) the receipt by the
Company 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; or (v)
the occurrence of any event or passage of time that makes the financial statements
included in such registration statement ineligible for inclusion therein or any statement
made in such registration statement or prospectus or any document incorporated or deemed
to be incorporated therein by reference untrue in any material respect or that requires
any revisions to such registration statement, prospectus or other documents so that, in
the case of such registration statement or prospectus, as the case may be, 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 light of
the circumstances under which they were made, not misleading;
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



---

---

| | Exchange
Act means the Securities Exchange Act of 1934, as amended, and any successor
statute.
| | ------------------------------------------------------------------------------------------------

| | Holderor
Holders means BOS or any of its successors to the extent any of them
holds Registrable Securities.
| | ---------------------------------------------------------------------------------------------------------------

| | Indemnified
Party shall have the meaning set forth in Section 6(c).
| | ---------------------------------------------------------------------

| | Indemnifying
Party shall have the meaning set forth in Section 6(c).
| | ----------------------------------------------------------------------

| | Loan
Agreement shall mean that Loan Agreement dated December 31, 2005, entered into
between Qualmax Ltd., and BOS.
| | --------------------------------------------------------------------------------------------------------------------

| | Offering
Registration Statement means any registration statement under the Securities
Act that registers the resale of any Registrable Securities.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------

| | Outsourcing
Agreement shall mean that Outsourcing Agreement dated December 31, 2005,
entered into between Qualmax Ltd., the Companys wholly owned subsidiary, and BOS.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Proceeding means
an action, claim, suit, investigation or proceeding (including, without limitation, an
investigation or partial proceeding, such as a deposition), whether commenced or
threatened.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Prospectus means
the prospectus included in the Offering Registration Statement (including, without
limitation, a prospectus that includes any information previously omitted from a
prospectus filed as part of an effective registration statement in reliance upon Rule
430A promulgated under the Securities Act), as amended or supplemented by any prospectus
supplement, with respect to the terms of the offering of any portion of the Registrable
Securities covered by the Offering Registration Statement, and all other amendments and
supplements to the Prospectus, including post-effective amendments, and all material
incorporated by reference or deemed to be incorporated by reference in such Prospectus.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Registrable
Securities means (a) the Share Consideration, including any Earn-Out Shares
issued and/or transferred to BOS pursuant to the Asset Purchase Agreement, (b) any
Additional Buyer Stock actually issued to BOS by the Company pursuant to the Asset
Purchase Agreement; (c) the shares of Common Stock underlying the Class A Warrants issued
by the Company to BOS in connection with the Loan Agreement (the Warrant Shares);
(d) any shares of Common Stock issued to BOS pursuant to Section 2.3 of the Loan
Agreement (the Loss Shares); (e) any shares of Common Stock issued to
BOS pursuant to Section 4.2 of the Loan Agreement (Default Shares) (f)
any shares of Commons Stock issued to BOS pursuant to Section 3 of the Outsourcing
Agreement (the Outsourcing Shares); and (g) any shares of Common Stock
issued in a stock split or as a dividend or other distribution made by Buyer with respect
to the aforementioned securities. Notwithstanding the foregoing, securities shall cease
to be Registrable Securities once they are eligible to be sold or distributed pursuant to
Rule 144 within any consecutive three month period (including, without limitation, Rule
144(k)) without volume limitations.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

2

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| | Rule
144 means Rule 144 promulgated by the Commission pursuant to the Securities
Act, as such Rule may be amended from time to time, or any similar rule or regulation
hereafter adopted by the Commission having substantially the same effect as such Rule.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Securities
Act means the Securities Act of 1933, as amended, and any successor statute.
| | -----------------------------------------------------------------------------------------

2.        All
references in this Agreement to amendments or supplements to the Offering
          Registration Statement, any preliminary Prospectus or Prospectus shall be
deemed           to mean and include the filing of any document under the Exchange Act,
after the           date of such Offering Registration Statement, preliminary Prospectus
or           Prospectus, as the case may be, which is incorporated by reference therein.

3.        Registration.

3.1        If
the Company at any time shall determine to prepare and file with the Commission a
registration statement registering an offering of its equity securities, for the account
of any Company Affiliate(s), each such time it will give written notice to the Holder of
its intention so to do. The Company shall, upon the written request of the Holder,
received by the Company within 20 days after the giving of any such notice by the
Company, to register any of its Registrable Securities, use its best efforts to cause the
Registrable Securities as to which registration shall have been so requested to be
included in the securities to be covered by the registration statement proposed to be
filed by the Company, all to the extent requisite to permit the sale or other disposition
by the holders of such Registrable Securities.

3.2        Registration
of Warrants Shares, Loss Shares, Outsourcing Shares and Default Shares. Without
limitation to the provisions of Section 3.1 above, if the Company at any time shall
determine to prepare and file with the Commission a registration statement registering an
offering of its equity securities, for its own account or for the account of others
(other than a Registration Statement on Form S-8, S-4 or any successor forms), the
Company shall cause the Warrant Shares, the Loss Shares, Outsourcing Shares and
Default Shares (if any) to be included in the securities to be covered by the
registration statement proposed to be filed by the Company, all to the extent requisite
to permit the sale or other disposition by the holders of such Warrant Shares and Loss
Shares. The Company expressly undertakes that in any event, unless previously registered,
the Company shall file an Offering Registration Statement covering all of the Warrant
Shares, and any outstanding Loss Shares, Outsourcing Shares and/or Default Shares within
Eighteen (18) months from the date hereof.

3.3        (a)
In the event that any registration pursuant to Section 3.1 shall be, in whole or in
part, an underwritten public offering, and the managing underwriter advises the Company
that the inclusion of all Registrable Securities proposed to be included in such
registration would interfere with the successful marketing (including pricing) of the
offering, then the size of the offering shall be reduced accordingly and include the
shares of Common Stock proposed to be registered for the account of the Company
Affiliate(s) and the Registrable Securities proposed to be registered for the account of
the Holder, pro-rata.

3

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| | (b)
In the event that any registration pursuant to Section 3.2 shall be, in
          whole or in part, an underwritten public offering, and the managing underwriter
          advises the Company that the inclusion of all securities proposed to be
included           in such registration would interfere with the successful marketing
(including           pricing) of the offering, then the size of the offering shall be
reduced           accordingly and include the shares of Common Stock proposed to be
registered for           the account of the Company, the shares of Common Stock proposed
to be registered           for the account of others, and the Warrant Shares and Loss
Shares proposed to be           registered for the account of the Holder, pro-rata.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

4.        Registration
Procedures. If and whenever the Company is required by the           provisions
hereof to effect the registration of any Registrable Securities under           the
Securities Act, the Company will, as expeditiously as practicable:

| | (a) | use
its best efforts to cause an Offering Registration Statement that registers
               such Registrable Securities to become and remain effective until the
earliest                of: (i) 2 years from the date of effectiveness; (ii) such time as
all of such                Registrable Securities have been disposed of; and (iii) such
time as such                Registrable Securities cease to be Registrable Securities
(such period, the                Registration Period); it being understood
that such Offering                Registration Statement may, in the Companys
discretion, be on any form                that the Company is eligible to use to register
the resale of the Registrable                Securities; it being further understood that
before or following the                effectiveness of an Offering Registration
Statement, the Company may change to                another form of registration
statement for which the Company is then eligible to                register its
securities, provided that at least one Offering Registration                Statement
covering the Registrable Securities not yet sold remains effective                during
such Registration Period.
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (b) | prepare
and file with the Commission such amendments and supplements to such
               Offering Registration Statement and the Prospectus used in connection
therewith                as may be necessary to keep such Offering Registration Statement
(or, in the                Companys discretion, a registration statement on another
form that the                Company is eligible to use to register its securities)
effective for a period of                2 years or until all of such Registrable
Securities have been disposed of (if                earlier) and to comply with the
provisions of the Securities Act with respect to                the sale or other
disposition of such Registrable Securities.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (c) | use
its best efforts to register or qualify such Registrable Securities under
               such other securities or blue sky laws of such jurisdictions as the Holder
               reasonably request and do any and all other acts and things that may be
               reasonably necessary or advisable to enable the Holder to consummate the
               disposition in such jurisdictions of the Registrable Securities owned by
the                Holder; provided, however, that the Company will not be required to
qualify                generally to do business, subject itself to general taxation or
consent to                general service of process in any jurisdiction where it would
not otherwise be                required to do so but for this paragraph (c) or to
provide any material                undertaking or make any changes in its By-laws or
Certificate of Incorporation                which the Board of Directors determines to be
contrary to the best interests of                the Company or to modify any of its
contractual relationships then existing;
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

4

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| | (d) | furnish
to the Holder and each duly authorized underwriter such number of copies
               of a summary Prospectus, if any, or other Prospectus, including a
preliminary                Prospectus, in conformity with the requirements of the
Securities Act, and such                other documents as the Holder may reasonably
request in order to facilitate the                public sale or other disposition of
such Registrable Securities;
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (e) | without
limiting subsection (c) above, use its best efforts to cause such
               Registrable Securities to be registered with or approved by such other
               governmental agencies or authorities as may be necessary by virtue of the
               business and operations of the Company to enable the Holder to consummate
the                disposition of such Registrable Securities;
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (f) | immediately
notify the Holder, at any time when a Prospectus relating to such
               Registrable Securities is required to be delivered under the Securities
Act                within the appropriate period mentioned in subparagraph (a) of this
Section 4,                of the happening of any event as a result of which the
Prospectus included in                such Offering Registration Statement, as then in
effect, includes an untrue                statement of a material fact or omits to state
a material fact required to be                stated therein or necessary to make the
statements therein not misleading in                light of the circumstances then
existing and, at the request of the Holder,                prepare and furnish to the
Holder a reasonable number of copies of a supplement                to, or an amendment
of, such Prospectus as may be necessary so that, as                thereafter delivered
to the offerees of such shares, such prospectus shall not                include an
untrue statement of a material fact or omit to state a material fact
               required to be stated therein or necessary to make the statements therein
not                misleading in light of the circumstances then existing;
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (g) | provide
a transfer agent and registrar for all Registrable Securities registered
               pursuant to this Agreement and a CUSIP number for all such Registrable
               Securities, in each case not later than the effective date of such
Offering                Registration Statement;
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (h) | furnish,
at the request of the Holder, on the date such Registrable Securities                are
delivered to the underwriters for sale in connection with a registration
               pursuant to this Agreement, if such securities are being sold through
               underwriters, or, if such securities are not being sold through
underwriters, on                the date that the Offering Registration Statement with
respect to such                securities becomes effective (1) an opinion, dated such
date, of counsel                representing the Company for the purposes of such
registration, in form and                substance as is customarily given to
underwriters in an underwritten public                offering, addressed to the
underwriters, if any, and to such the Holder, and (2)                a letter dated such
date, from the independent certified public accountants of                the Company, in
form and substance as is customarily given by independent                certified public
accountants to underwriters in an underwritten public offering                addressed
to the underwriters, if any, and to the Holder;
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

5

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| | (i) | immediately
notify the Holder of a Discontinuation Event and provide the Holder                true
and complete copies of any documentation related to such Discontinuation
               Event;
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (j) | list
any Registrable Securities that are eligible for such listing on the NASD
               OTC Bulletin Board, Nasdaq Small Cap Market and/or on any other trading
market                or markets on which the Common Stock is then listed;
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (k) | subject
to all the other provisions of this Agreement, use its best efforts to
               take all other steps necessary to effect the registration of the
Registrable                Securities that are required to be registered hereby.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

5.        Registration
Expenses. All expenses relating to the Companys                compliance with
Sections 3 and 4 hereof, including, without limitation, all                registration
and filing fees, printing expenses, fees and disbursements of                counsel and
independent public accountants for the Company, fees and expenses
               (including reasonable counsel fees) incurred in connection with complying
with                state securities or blue sky laws, fees of the NASD,
transfer taxes,                fees of transfer agents and registrars, reasonable fees
of, and disbursements                incurred by, one counsel for the Holder (to the
extent such counsel is required                due to Companys failure to meet any
of its obligations hereunder), are                called Registration Expenses. All
selling commissions applicable to                the sale of Registrable Securities,
including any fees and disbursements of any                special counsel to the Holder
beyond those included in Registration Expenses,                are called Selling
Expenses. The Company shall only be responsible                for all Registration
Expenses and not for any Selling Expenses.

6.        Indemnification.

(a)        In
the event of a registration of any Registrable Securities under the
               Securities Act pursuant to this Agreement, the Company will indemnify and
hold                harmless the Holder, and its officers, directors and each other
person, if any,                who controls the Holder within the meaning of the
Securities Act (collectively,                the Holder Indemnified Parties),
against any losses, claims, damages                or liabilities, joint or several, to
which the Holder, or such persons may                become subject under the Securities
Act or otherwise, insofar as such losses,                claims, damages or liabilities
(or actions in respect thereof) arise out of or                are based upon any untrue
statement or alleged untrue statement of any material                fact contained in
any Offering Registration Statement under which such                Registrable
Securities were registered under the Securities Act pursuant to this
               Agreement, any preliminary Prospectus or final Prospectus contained
therein, or                any amendment or supplement thereof, or arise out of or are
based upon the                omission or alleged omission to state therein a material
fact required to be                stated therein or necessary to make the statements
therein not misleading, and                will reimburse the Holder, and each such
person for any reasonable legal or                other expenses incurred by them in
connection with investigating or defending                any such loss, claim, damage,
liability or action; provided, however, that the Company will not be liable
in any such case if and to                the extent that any such loss, claim, damage or
liability arises out of or is                based upon (A) any untrue statement or
alleged untrue statement or omission or                alleged omission so made in
conformity with information furnished by or on                behalf of the Holder or any
such person in writing specifically for use in any                such document; (B) use
of the registration statement or the related prospectus                following a
Discontinuation Event, provided Holder received prior notice of such
               Discontinuation Event; or (C) if the Holder fails to deliver a Prospectus,
as                then amended or supplemented, provided that the Company shall have
delivered to                the Holder such Prospectus.

6

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(b)        In
the event of a registration of the Registrable Securities under the
               Securities Act pursuant to this Agreement, the Holder will indemnify and
hold                harmless the Company, and its officers, directors and each other
person, if any,                who controls the Company within the meaning of the
Securities Act, against all                losses, claims, damages or liabilities, joint
or several, to which the Company                or such persons may become subject under
the Securities Act or otherwise,                insofar as such losses, claims, damages
or liabilities (or actions in respect                thereof) arise out of or are based
upon any untrue statement or alleged untrue                statement of any material fact
which was furnished in writing by the Holder to                the Company expressly for
use in (and such information is contained in) an                Offering Registration
Statement under which Registrable Securities were                registered under the
Securities Act pursuant to this Agreement, any preliminary                Prospectus or
final Prospectus contained therein, or any amendment or supplement
               thereof, or arise out of or are based upon the omission or alleged
omission to                state therein a material fact required to be stated therein or
necessary to make                the statements therein not misleading, and will
reimburse the Company and each                such person for any reasonable legal or
other expenses incurred by them in                connection with investigating or
defending any such loss, claim, damage,                liability or action; provided,
however, that the Holder will be                liable in any such case if and
only to the extent that any such loss, claim,                damage or liability arises
out of or is based upon an untrue statement or                alleged untrue statement or
omission or alleged omission so made in conformity                with information
furnished in writing to the Company by or on behalf of the                Holder
specifically for use in any such document.

(c)        Promptly
after receipt by a party entitled to claim indemnification hereunder                (an
Indemnified Party) of notice of the commencement of any action,
               such Indemnified Party shall, if a claim for indemnification in respect
thereof                is to be made against a party hereto obligated to indemnify such
Indemnified                Party (an Indemnifying Party), notify the
Indemnifying Party in                writing thereof, but the omission or delay so to
notify the Indemnifying Party                shall not relieve it from any liability
which it may have to such Indemnified                Party unless and to the extent the
Indemnifying Party is actually prejudiced by                such omission or delay. In
case any such action shall be brought against any                Indemnified Party and it
shall notify the Indemnifying Party of the commencement                thereof, the
Indemnifying Party shall be entitled to participate in and, to the                extent
it shall wish, to assume and undertake the defense thereof with counsel
               reasonably satisfactory to such Indemnified Party, provided however, that
if the                defendants in any action include both the Indemnified and
Indemnifiable Party                and if in the reasonable judgment of the Indemnified
Party there is a conflict                of interest that would prevent counsel for the
Indemnifying Party from also                representing the Indemnified Party, the
Indemnified Party shall have the right                to select, at the expense of the
Indemnifying Party, separate counsel to                participate in the defense of such
action; provided, further, however, that if any of the Holder
Indemnified Parties is an Indemnified                Party, then the Holder Indemnified
Parties shall, in the aggregate, be entitled                to one (1) separate counsel
at the expense of the Indemnifying Party. After                notice from the
Indemnifying Party to such Indemnified Party of its election so                to assume
and undertake the defense thereof, the Indemnifying Party shall not be
               liable to such Indemnified Party under this Section 6(c) for any legal
expenses                subsequently incurred by such Indemnified Party in connection
with the defense                thereof, unless (i) the Indemnified Party shall have
employed counsel in                accordance with the provision of the preceding
sentence, (ii) the Indemnifying                Party shall not have employed counsel
satisfactory to the Indemnified Party to                represent the same within a
reasonable time after the notice of commencement of                the action and within
fifteen (15) days after written notice of the Indemnified                Partys
intention to employ separate counsel pursuant to the provisions of                the
previous sentence, (iii) the Indemnifying Party has authorized the
               employment of counsel for the Indemnified Party at the expense of the
               Indemnifying Party, or (iv) the Indemnifying Party has authorized the
employment                of counsel but such party or counsel fails to vigorously defend
the action. No                Indemnifying Party will consent to entry of any judgment or
shall enter into any                settlement with respect to any claim for which
indemnification is sought                hereunder, which does not include as an
unconditional term thereof the giving by                the claimant or plaintiff to such
Indemnified Party of a release from all                liability in respect to such claim
or litigation. No Indemnified Party shall                consent to entry of any judgment
or shall enter into any settlement with respect                to any claim for which
indemnification is sought hereunder, without the prior                written consent of
the Indemnifying Party, which consent shall not be                unreasonably withheld
or conditioned.

7

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(d)        In
order to provide for just and equitable contribution in the event of joint
               liability under the Securities Act in any case in which an Indemnified
Party or                any officer, director or controlling person thereof, makes a
claim for                indemnification pursuant to this Section 6 but it is judicially
determined (by                the entry of a final judgment or decree by a court of
competent jurisdiction and                the expiration of time to appeal or the denial
of the last right of appeal) that                such indemnification may not be
enforced, notwithstanding the fact that this                Section 6 provides for
indemnification in such case, then the Indemnifying Party                will contribute
to the aggregate losses, claims, damages or liabilities to which                it may be
subject (after contribution from others) in such proportion as is
               appropriate to reflect the relative fault of the Indemnifying Party and
the                relative fault of the Indemnified Party as well as any other relevant
equitable                considerations. Relative fault shall be determined by reference
to, among other                things, whether any untrue statement or omission or
alleged untrue statement of                a material fact or the omission to state a
material fact relates to information                provided by the Indemnifying Party or
the Indemnified Party, and the                parties relative intent, knowledge,
access to information and opportunity                to correct or prevent such statement
or omission. Notwithstanding the foregoing,                no person or entity guilty of
fraudulent misrepresentation (within the meaning                of Section 11(f) of the
Securities Act) will be entitled to contribution from                any person or entity
that was not guilty of such fraudulent misrepresentation.

(e)        The
provisions of this Section 6 will remain in full force and effect and
               survive the sale by the Holder of the Registrable Securities covered by an
               Offering Registration Statement pursuant to which such Registrable
Securities                shall have been sold under this Agreement.

8

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7.        Public
Information.

The Company shall undertake to make
publicly available and available to the Holder adequate current public information within
the meaning of, and as required pursuant to, Rule 144(c).

8.        Changes
in Registrable Securities.

If there are any changes in the
Registrable Securities by way of stock split, stock dividend , combination or
reclassification, or through merger, consolidation, reorganization or recapitalization, or
by any other means, appropriate adjustment shall be made in the provisions of this
Agreement, as may be required, so that the rights and privileges granted hereby shall
continue with respect to the Registrable Securities as so changed.

9.        Miscellaneous.

(a)        Remedies.
In the event of a breach by the Company or by the Holder, of           any of their
respective obligations under this Agreement, the Holder or the           Company, as the
case may be, in addition to being entitled to exercise all           rights granted by
law and under this Agreement, including recovery of damages,           will be entitled
to specific performance of its rights under this Agreement.

(b)        Other
Registrations Rights. Except as and to the extent specified in           Schedule
9(b) hereto, the Company has not previously entered into any agreement           granting
any registration rights with respect to any of its securities to any           person
that have not been fully satisfied.

(c)        Compliance.
The Holder covenants and agrees that it will comply with the           prospectus
delivery requirements of the Securities Act as applicable to it in           connection
with sales of Registrable Securities pursuant to any Offering           Registration
Statement to be filed in accordance with the provisions of this           Agreement.

(d)        Amendments
and Waivers. The provisions of this Agreement, including the           provisions of
this sentence, may not be amended, modified or supplemented, and           waivers or
consents to departures from the provisions hereof may not be given,           unless the
same shall be in writing and signed by the Company and the Holder.

(e)        Notices.
Any notice or request hereunder may be given to the Company or           the Holder at
the respective addresses set forth below or as may hereafter be           specified in a
notice designated as a change of address under this Section 9(e).           Any notice or
request hereunder shall be given by registered or certified mail,           return
receipt requested, hand delivery, overnight mail or Federal Express or           other
national overnight next day carrier (collectively, Courier).
          Notices and requests shall be, in the case of those by hand delivery, deemed to
          have been given when delivered to any party to whom it is addressed, in the
case           of those by mail or overnight mail, deemed to have been given seven (7)
business           days after the date when deposited in the mail or three (3) business
days after           the date when deposited with the overnight mail carrier and, in the
case of a           Courier, then upon delivery of the package by the Courier. The
address for such           notices and communications shall be as follows:

9

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| | If to th Holder: | B.O.S.
Better Online Solutions Ltd. 
To the address set forth under the Holders 
name on the signature page hereto.
| | ---------------- | --------------------------------------------------------------------------------------------------------------------

| | with a copy to:
Amit, Pollak, Matalon & Co. 
NYP Tower, 17 Yitzhak Sadeh Street, 19th Floor 
Tel Aviv, 67775, Israel 
Attention: Shlomo Landress, Adv.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------

| | If to the Company: | To the  address set forth  under the  Companys  
name on the signature page hereto.
| | ------------------ | ------------------------------------------------------------------------------------

| | with a copy to:
Kramer Levin Naftalis & Frankel LLP 
1177 Avenue of The Americas 
New York, New York  10036 
Attention:  Scott S. Rosenblum, Esq.
| | -------------------------------------------------------------------------------------------------------------------------------------------------

| | or
such other address as may be designated in writing hereafter in accordance with this
Section 9(e) by such person.
| | --------------------------------------------------------------------------------------------------------------------

(f)        Successors
and Assigns. This Agreement shall inure to the benefit of and           be binding
upon the successors and permitted assigns of each of the parties and           shall
inure to the benefit of the Holder. The Company may not assign its rights           or
obligations hereunder without the prior written consent of the Holder. The
          Holder may assign its rights hereunder to any purchaser or transferee of
          Registrable Securities that agrees in writing to be bound hereby.

(g)        Execution
and Counterparts. This Agreement may be executed in any number           of
counterparts, each of which when so executed shall be deemed to be an           original
and, all of which taken together shall constitute one and the same           Agreement.
In the event that any signature is delivered by facsimile           transmission, such
signature shall create a valid binding obligation of the           party executing (or on
whose behalf such signature is executed) the same with           the same force and
effect as if such facsimile signature were the original           thereof.

(h)        Governing
Law; Venue. This Agreement shall be deemed to have been           executed and
delivered in the State of New York, and the validity, enforcement           and
construction hereof shall be governed in all respects by the internal laws
          (without regard to principles of conflicts of law) of the State of New York.
Any           legal action or proceeding arising under or in relation to this Agreement
shall           be brought exclusively in a federal or state court of competent
jurisdiction           within the State and County of New York. In addition, each of the
undersigned           parties consents and agrees that any court in which such legal
action or           proceeding is commenced may exercise jurisdiction over his, her or
its person           for purposes of enforcing the terms of this Agreement and agrees not
to assert           that venue in New York is inappropriate or inconvenient.

10

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(i)        Cumulative
Remedies. The remedies provided herein are cumulative and not           exclusive of
any remedies provided by law.

(j)        Severability.
If any term, provision, covenant or restriction of this           Agreement is held by a
court of competent jurisdiction to be invalid, illegal,           void or unenforceable,
the remainder of the terms, provisions, covenants and           restrictions set forth
herein shall remain in full force and effect and shall in           no way be affected,
impaired or invalidated, and the parties hereto shall use           their reasonable
efforts to find and employ an alternative means to achieve the           same or
substantially the same result as that contemplated by such term,           provision,
covenant or restriction. It is hereby stipulated and declared to be           the
intention of the parties that they would have executed the remaining terms,
          provisions, covenants and restrictions without including any of such that may
be           hereafter declared invalid, illegal, void or unenforceable.

(k)        Headings.
The headings in this Agreement are for convenience of reference           only and shall
not limit or otherwise affect the meaning hereof.

# [Balance Of Page
Intentionally Left Blank; 
Signature Page Follows]

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IN
WITNESS WHEREOF, the parties have executed this Registration Rights Agreement as of the
date first written above.

|B.O.S. BETTER ONLINE SOLUTIONS LTD.By: 
Name: Adiv Baruch     Nehemia KaufmanTitle:           CEO
                     CFO |  | QUALMAX, INC.By: 
Name: _______________Title: ________________
|---------------------------------------------------------------------------------------------------------------------------------------- |  | ----------------------------------------------------------------------------

|                                 |                      
|-------------------------------- | ---------------------
|
|
|
|
|Address for Notices:             | Address for Notices: 
|Beit Rabin, Teradyon             | 340 West Fifth Avenue
|                                 | Eugene, Oregon, 97401
|Misgav, 20179, Israel            | U.S.A.               
|Attention:  Nehemia Kaufman, CFO | Attention:           

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NEITHER THIS WARRANT NOR THE
SECURITUES ISSUABLE UPON EXERCISE HEREOF HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED, OR UNDER ANY STATE SECURITIES OR BLUE SKY LAWS. SUCH
SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE SOLD OR TRANSFERRED FOR VALUE
IN THE ABSENCE OF AN EFFECTIVE REGISTRATION OF THEM UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, AND ANY APPLICABLE STATE SECURITIES LAWS OR AN OPINION OF COUNSEL THAT AN
EXEMPTION FROM SUCH REGISTRATION REQUIREMENTS IS AVAILABLE WITH RESPECT TO SUCH SALE OR
TRANSFER.

Class A Warrant to Purchase Shares of Common Stock of

# Qualmax Inc.

|       |                              
|------ | -----------------------------
|
|
|
|
|No. A- | Issue Date: December 31, 2005

QUALMAX,
INC., a corporation incorporated under the laws of the State of Delaware (the
Company) hereby certifies that, for value received, B.O.S. BETTER
ONLINE SOLUTIONS LTD., and/or its assigns (the Holder), is entitled,
subject to the terms set forth below, to purchase from the Company from and after the
Issue Date of this Warrant and at any time or from time to time before 5:00 p.m., New York
time on December31, 2010 (the Expiration Date), up to 107,143 fully
paid and nonassessable shares of common stock, par value $0.001 per share, of the Company
(Common Stock), at an exercise price of $2.80 per share of Common
Stock, for an aggregate exercise price of three hundred thousand dollars and forty cents
($300,000.40) (the aggregate purchase price payable for the Warrant Shares (as defined
below) hereunder is hereinafter sometimes referred to as the Aggregate Exercise
Price). The number of shares of Common Stock purchasable by Holder and to be
received thereby upon exercise of this Warrant and the price to be paid for each share of
Common Stock are subject to possible adjustment from time to time as hereinafter set
forth. The shares of Common Stock or other securities or property deliverable upon such
exercise as adjusted from time to time is hereinafter sometimes referred to as the
Warrant Shares. The exercise price of per share of Common Stock in
effect at any time and as adjusted from time to time is hereinafter sometimes referred to
as the Per Share Exercise Price. The Per Share Exercise Price is
subject to adjustment as hereinafter provided; in the event of any such adjustment, the
number of Warrant Shares shall also be adjusted, by dividing the Aggregate Exercise Price
by the Per Share Exercise Price in effect immediately after such adjustment. The Aggregate
Exercise Price is not subject to adjustment except to the extent of any partial exercise
of this Warrant. This Warrant may constitute one in a series of warrants (the
Class A Warrants), which includes this Warrant and any other Class A
Warrant for the Purchase of Shares of Common Stock of the Company, of like tenor hereto.

1.        Exercise
of Warrant.

| | 1.1 | This
Warrant may be exercised in whole or in part at any time by its holder from the date
hereof until the Expiration Date, by presentation and surrender of this Warrant, together
with the duly executed subscription form attached hereto as Exhibit A (the
Exercise Notice), at the address set forth in Subsection 12.1 hereof,
together with payment, by certified or official bank check or wire transfer payable to
the order of the Company, of the Aggregate Exercise Price or the proportionate part
thereof if exercised in part.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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| | 1.2 | If
this Warrant is exercised in part only, the Company shall, upon presentation of this
Warrant upon such exercise, execute and deliver (along with the certificate to be
delivered pursuant to Section 2 hereof for the Warrant Shares purchased) a new Warrant
evidencing the rights of the Holder hereof to purchase the balance of the Warrant Shares
purchasable hereunder upon the same terms and conditions as herein set forth.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 1.3 | The
certificates representing the Warrant Shares shall bear the following legend:
| | --- | ---------------------------------------------------------------------------------

| | THE
SECURITUES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED, OR UNDER ANY STATE SECURITIES OR BLUE SKY LAWS. SUCH
SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE SOLD OR TRANSFERRED FOR VALUE
IN THE ABSENCE OF AN EFFECTIVE REGISTRATION OF THEM UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, AND ANY APPLICABLE STATE SECURITIES LAWS OR AN OPINION OF COUNSEL THAT AN
EXEMPTION FROM SUCH REGISTRATION REQUIREMENTS IS AVAILABLE WITH RESPECT TO SUCH SALE OR
TRANSFER.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

2.        Delivery
of Warrant Shares, Share Certificates, Etc., on Exercise. The           Company
agrees that the Warrant Shares purchased upon exercise of this Warrant           shall be
deemed to be issued to the Holder as the record owner of such shares as           of the
close of business on the date on which this Warrant shall have been           surrendered
and payment made for such shares in accordance herewith. As soon as           practicable
after the exercise of this Warrant in full or in part, and in any           event within
three (3) business days thereafter, the Company at its expense will           cause to be
issued in the name of and delivered to the Holder, a certificate or
          certificates for the number of Warrant Shares to which the Holder shall be
          entitled on such exercise pursuant to Section 1 or otherwise. The Warrant
Shares           when issued and delivered to the Holder, shall be duly and validly
issued, fully           paid and non-assessable shares of the Company.

3.        Effect
of Reorganization, Etc.; Adjustment of Exercise Price.

| | 3.1 | In
the event of any capital reorganization or reclassification not otherwise covered in
Section 4, or any consolidation or merger to which the Company is a party other than a
merger or consolidation in which the Company is the surviving corporation, or in case of
any sale or conveyance to another entity of the property of the Company as an entirety or
substantially as an entirety, or in the case of any statutory exchange of securities with
another corporation (including any exchange effected in connection with a merger of a
third corporation into the Company), the Holder of this Warrant shall have the right
thereafter to receive on the exercise of this Warrant the kind and amount of securities,
cash or other property which the Holder would have owned or have been entitled to receive
immediately after such reorganization, reclassification, consolidation, merger, statutory
exchange, sale or conveyance had this Warrant been exercised immediately prior to the
effective date of such reorganization, reclassification, consolidation, merger, statutory
exchange, sale or conveyance and in any such case, if necessary, appropriate adjustment
shall be made in the application of the provisions set forth in Section 4 with respect to
the rights and interests thereafter of the Holder of this Warrant to the end that the
provisions set forth in Section 4 shall thereafter correspondingly be made applicable, as
nearly as may reasonably be, in relation to any shares of stock or other securities or
property thereafter deliverable on the exercise of this Warrant. The above provisions of
this Section 3 shall similarly apply to successive reorganizations, reclassifications,
consolidations, mergers, statutory exchanges, sales or conveyances.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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| | 3.2 | If,
as a result of an adjustment made pursuant to this Section 3, the Holder shall become
entitled to receive, upon exercise of the Warrant, shares of two or more classes of
capital stock or shares of Common Stock and other capital stock of the Company, the Board
of Directors of the Company (whose determination shall be conclusive) shall determine the
allocation of the adjusted Per Share Exercise Price between or among shares or such
classes of capital stock or shares of Common Stock and other capital stock.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

4.        Extraordinary
Events Regarding Common Stock.

| | 4.1 | In
case the Company shall hereafter (i) pay a dividend or make a distribution on its capital
stock in shares of Common Stock, (ii) subdivide its outstanding shares of Common Stock
into a greater number of shares, (iii) combine its outstanding shares of Common Stock
into a smaller number of shares or (iv) issue by reclassification of its Common Stock any
shares of capital stock of the Company (each of (i) through (iv) an Action),
the Per Share Exercise Price shall be adjusted to be equal to a fraction, the numerator
of which shall be the Aggregate Exercise Price and the denominator of which shall be the
number of shares of Common Stock or other capital stock of the Company that the Holder
would have held (solely as a result of the exercise of this Warrant and the operation of
such Action) immediately following such Action if this Warrant had been exercised
immediately prior to such Action. An adjustment made pursuant to this Section 4 shall
become effective immediately after the record date in the case of a dividend or
distribution and shall become effective immediately after the effective date in the case
of a subdivision, combination or reclassification.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 4.2 | Whenever
the Per Share Exercise Price payable upon exercise of this Warrant is adjusted pursuant
to this Section 4, the number of shares of Common Stock underlying this Warrant shall
simultaneously be adjusted to equal the number obtained by dividing the Aggregate
Exercise Price (as the same shall be reduced to the extent of any partial exercise of
this Warrant) by the adjusted Per Share Exercise Price.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

3

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5.        Certificate
as to Adjustments. In each case of any adjustment or           readjustment in the
Warrant Shares issuable on the exercise of the Warrant or           the Per Share
Exercise Price thereof, the Company at its expense will promptly           cause its
Chief Financial Officer or other appropriate designee to compute such
          adjustment or readjustment in accordance with the terms of the Warrant and
          prepare a certificate setting forth such adjustment or readjustment and showing
          in detail the facts upon which such adjustment or readjustment is based,
          including a statement of the Exercise Price and the number and type of Warrant
          Shares to be received upon exercise of this Warrant, in effect immediately
prior           to such adjustment or readjustment and as adjusted or readjusted as
provided in           this Warrant. The Company will forthwith deliver a copy of each
such certificate           to the Holder of the Warrant.

6.        Reservation
of Shares, Etc., Issuable on Exercise of Warrant. The Company           will at all
times reserve and keep available, solely for issuance and delivery           on the
exercise of the Warrant, such number of Warrant Shares as are from time           to time
issuable on the exercise of the Warrant.

7.        Representations
and Warranties by the Holder. The Holder, by its           acceptance of its Warrant,
represents and warrants to the Company as follows:

| | 7.1 | Holder
understands that this Warrant and any securities obtainable upon exercise of this Warrant
have not been registered for sale under Federal or state securities laws and are being
offered and sold to the Holder pursuant to one or more exemptions from the registration
requirements of such securities laws. The Holder is an accredited investor within
the meaning of Regulation D under the Securities Act of 1933, as amended (the Act).
In the absence of an effective registration of such securities or an exemption therefrom,
any certificates for such securities shall bear the legend set forth on the first page
hereof. The Holder understands that it must bear the economic risk of its investment in
this Warrant and any securities obtainable upon exercise of this Warrant for an
indefinite period of time, as this Warrant and such securities have not been registered
under Federal or state securities laws and therefore cannot be sold unless subsequently
registered under such laws, unless as exemption from such registration is available.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 7.2 | Holder
is acquiring this Warrant and will acquire any securities obtainable upon exercise of
this Warrant for its own account for investment and not with a view to, or for sale in
connection with, any distribution thereof in violation of the Act. The Holder agrees that
this Warrant and any such securities will not be sold or otherwise transferred unless (i)
a registration statement with respect to such transfer is effective under the Act and any
applicable state securities laws or (ii) such sale or transfer is made pursuant to one or
more exemptions from the Act.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 8.        Assignment;
Exchange of Warrant. Subject to compliance with applicable           securities laws,
this Warrant, and the rights evidenced hereby, may be           transferred by any
registered Holder hereof (a Transferor) in           whole or in part.
On the surrender for exchange of this Warrant, with the           Transferors
endorsement in the form of Exhibit           B attached
hereto (the Transferor Endorsement           Form) and together with evidence
reasonably satisfactory to the Company           demonstrating compliance with applicable
securities laws, the Company at its           expense (but with payment by the Transferor
of any applicable transfer taxes)           will issue and deliver to or on the order of
the Transferor thereof a new Class           A Warrant, in the name of the Transferor
and/or the transferee(s) specified in           such Transferor Endorsement Form (each a
Transferee), calling in the           aggregate on the face or faces thereof
for the number of shares of Common Stock           called for on the face or faces of the
Warrant so surrendered by the Transferor.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

4

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9.        Replacement
of Warrant. On receipt of evidence reasonably satisfactory to           the Company
of the loss, theft, destruction or mutilation of this Warrant and           (i) in the
case of any such loss, theft or destruction of this Warrant, subject           to
delivery of a reasonable indemnity of the Company by the Holder in connection
          therewith or (ii) in the case of any such mutilation, on surrender and
          cancellation of this Warrant, the Company at its expense will execute and
          deliver, in lieu thereof, a new Class A Warrant of like date, tenor and
          denomination.

10.        Registration
Rights. The Holder of this Warrant has been granted certain           registration
rights by the Company. These registration rights are set forth in a
          Registration Rights Agreement entered into by the Company and the Holder dated
          as of even date of this Warrant.

11.        Rights
of Shareholders. No Holder shall be entitled, as a Warrant holder,           to vote
or receive dividends or be deemed the holder of the shares of Common           Stock or
any other securities of the Company, which may at any time be issuable           upon the
exercise of this Warrant for any purpose, nor shall anything contained           herein
be construed to confer upon the Holder, as such, any of the rights of a
          shareholder of the Company or any right to vote for the election of directors
or           upon any matter submitted to shareholders at any meeting thereof, or to give
or           withhold consent to any corporate action (whether upon any recapitalization,
          issuance of shares, reclassification of shares, change of nominal value,
          consolidation, merger, conveyance, or otherwise) or to receive notice of
          meetings, or to receive dividends or subscription rights or otherwise until the
          Warrant shall have been exercised and the Warrant Shares issuable upon the
          exercise hereof shall have become deliverable, as provided herein.

12.        Notices,
Etc. No notice or other communication under this Warrant shall           be effective
unless, but any notice or other communication shall be effective           and shall be
deemed to have been given if, the same is in writing and is mailed           by
first-class mail, postage prepaid, addressed to:

| | 12.1 | the
Company at 340 West Fifth Avenue,  Eugene  Oregon,  97401,  Attention:  Chief  Executive
 Officer,  or                   such other address as the Company has designated by
notice to the Holder; or
| | ---- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 12.2 | the
Holder at Beit Rabin,  Teradyon,  Misgav 20179, Israel,  Attention:  Chief Executive
Officer , or such                   other address as the Holder has designated by notice
to the Company.
| | ---- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

13.        Voluntary
Adjustment by the Company. The Company may at any time during           the term of
this Warrant reduce the then current Per Share Exercise Price to any           amount and
for any period of time deemed appropriate by the Board of Directors           of the
Company.

5

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14.        Miscellaneous.
This Warrant and any term hereof may be changed, waived,           discharged or
terminated only by an instrument in writing signed by the Company           and the
registered holders of a majority of the then outstanding Class A           Warrants.
Absent the Holders prior written consent, the Company undertakes           not to
issue any additional Class A Warrants, except pursuant to the provisions           of
this Warrant. This Warrant shall be governed by and construed in accordance
          with the laws of State of New York without regard to principles of conflicts of
          laws. Any action brought concerning the transactions contemplated by this
          Warrant shall be brought only in the state courts of New York or in the federal
          courts located in the state of New York. The Company and the Holder hereby
agree           to submit to the jurisdiction of such courts and waive trial by jury. The
          prevailing party shall be entitled to recover from the other party its
          reasonable attorneys fees and costs. In the event that any provision of
          this Warrant is invalid or unenforceable under any applicable statute or rule
of           law, then such provision shall be deemed inoperative to the extent that it
may           conflict therewith and shall be deemed modified to conform with such
statute or           rule of law. Any such provision, which may prove invalid or
unenforceable under           any law shall not affect the validity or enforceability of
any other provision           of this Warrant. The headings in this Warrant are for
purposes of reference           only, and shall not limit or otherwise affect any of the
terms hereof. The           invalidity or unenforceability of any provision hereof shall
in no way affect           the validity or enforceability of any other provision. Each of
the Company and           the Holder acknowledges that its legal counsel participated in
the preparation           of this Warrant and, therefore, stipulates that the rule of
construction that           ambiguities are to be resolved against the drafting party
shall not be applied           in the interpretation of this Warrant to favor any party
against the other           party.

# [BALANCE OF PAGE
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IN
WITNESS WHEREOF, the Company has executed this Warrant as of the date first written above.

| | QUALMAX INC.
By:
Name:Title: | 
| | ------------------------------------------ | 

7

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# EXHIBIT A

FORM OF SUBSCRIPTION 
(To Be Signed Only On
Exercise Of Warrant)

[omitted]

A-1



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# EXHIBIT B

FORM OF TRANSFEROR
ENDORSEMENT 
(To Be Signed Only On
Transfer Of Warrant)

[omitted]

B-1



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