Exhibit
      10.12

    


    

    


    SPO
      MEDICAL INC.

    21860
      Burbank Blvd., North Building, Suite 380, Woodland Hills, California
      91367

    Tel:
      818-888-4380 Fax: 818-888-4385

    
      
        

      

    

     

    

      
        	
                March
                  27, 2006

              	 	
                By
                  Fax

              	 


      

    

     

    Innopex
      Limited. 

    140
      Cidermill Ave., 

    Concord,
      Ont. Canada L4K 4T5

    


    Dear
      Sir:

    


    RE: Line
      of Credit facility 

    


    I
      wish to
      confirm that we have agreed to the following:

    


    
      	1.  	
              Innopex
                Limited (“Innopex”) will extend to SPO Medical Inc.(“SPO”) a Line of
                Credit up to a maximum sum of US $200,000 (“Facility”). SPO may draw on
                the Facility from time to time at its discretion. Upon receipt of
                written
                notice from SPO, Innopex shall forthwith wire the funds requested
                under
                the Facility to SPO’s account.

            


    

    
      	 	 


    

    
      	2.  	
              Interest
                will be payable on a quarterly basis at the rate of 9% per annum,
                based on
                the Facility exercised in the same period.


            


    

    
      	 	 


    

    
      	3.  	
              Repayment
                of all moneys owing, including interest, under the Facility shall
                be paid
                with a value date no later than January 28, 2008. All payments to
                Innopex
                hereunder shall be wired directly to Innopex’s bank account.
                

            


    

    
      	 	 


    

    
      	4.  	
              Furthermore,
                in consideration of the Facility, SPO will issue to Innopex warrants
                for
                the purchase of shares of Common Stock of SPO. The said warrant is
                for the
                purchase of 50,000 shares of Common Stock of SPO at an exercise price
                per
                share of US$1.50. These warrants will be valid for three years from
                the
                date of issuance. The warrants shall be exercisable as follows: 20,000
                shares anytime after signing this agreement in consideration of Innopex’s
                commitment herein and the balance of 30,000 at any time after first
                draw
                by SPO for any amount under the
                Facility.

            


    

    


    Please
      sign below to confirm your acceptance of this agreement as stated
      above.

    
      	 	 	 	 
	Yours sincerely, 	 	 	 
	 	 	 	 
	
              /s/
                Micahel Braunold

            	 	 	
            
	
              

              Michael
                Braunold

            	 	 	
            
	
              President
                & CEO

            	 	 	
            




    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Acceptance
      of the terms in the above agreement:

    Innopex
      Limited.

    
      	 	 	 	 
	 	 	 	 
	
              

              Name:

            	 	 	
            
	
              Title:

            	 	 	 


    

     

    
      
        
        

      

      
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