Document:

Employment Agreement

     This Employment Agreement ("Agreement") is made effective as of the 1st day
of  October  2000.  by  and  between  ValCom,  Inc., a Delaware corporation (the
"Corporation")  and  Vince  M  Vellardita  ("Employee").

     WHEREAS,  the Corporation and Employee desire to enter into this Employment
Agreement  to insure the Corporation of the services of Employee during the term
hereof  and  to  insure Employee of his continued employment by the Corporation;
NOW,  THEREFORE,  in  consideration of the premises and the mutual covenants and
agreements  herein  set  forth,  the  parties  hereto  agree  as  follows:

     1.  Employment. The Corporation hereby employs Employee and Employee hereby
         -----------
accepts  such  employment  by  the  Corporation  upon  the  terms and conditions
hereinafter  set  forth,  all  other  agreements,  arrangements and undertakings
between the Corporation and Employee with respect to employment being superseded
hereby  for  all  purposes.

     2.  Term.  The  term  of  said  employment  shall  be  for  five (5) years,
         -----
beginning  on  October  1,  2000  and,  subject  to  Paragraph 8, terminating on
September  30,  2005,  unless  extended  pursuant  to  Paragraph  9.

     3.  Compensation.  As  compensation  for  all services he may render to the
         -------------
Corporation,  the  Corporation  shall  pay  to  Employee:
          3.1.  An  annual  salary  of  $120,000.00 for the first year beginning
October  1,  2000 and ending September 30, 2001. $150,000.00 for the second year
beginning October 1, 2001 and ending September 30, 2002, and $200,000.00 for the
third  year  beginning  October  1,  2002  and  ending  September 30, 2003; plus
          3.2.   Such bonus that may, but need not be, be declared and paid from
time  to  time  in the sole and absolute discretion of the Board of Directors of
the  Corporation or duly-authorized Compensation Committee thereof, after taking
into  consideration  the  performance of the Corporation, profitability, working
capital  requirements and such other factors as shall be determined by the Board
of  Directors  of  the Corporation or the duly-authorized Compensation Committee
thereof.

     4. Duties. For the entire term of this Employment Agreement, Employee shall
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be  employed  in  the  capacity  of President and Chief Executive Officer of the
Corporation.  As,  President  and Chief Executive Officer, Employee shall do and
perform all services or acts necessary or advisable, subject to the policies set
by  the  Board of Directors of the Corporation. As President and Chief Financial
Officer,  Employee  shall have such powers and authorities as shall be conferred
by  the  Board  of  Directors  of  the  Corporation.

     5.  Extent  of  Services.
         ---------------------

<PAGE>
          5.1.  For  the full terms of this Employment Agreement, Employee shall
devote  substantially  all  of  this  attention,  abilities  and energies to the
business  of  the  Corporation  during  regular  business  hours.
          5.2.  Employee  shall  not,  without the prior written, consent of the
Corporation,  or  unless  otherwise  permitted  pursuant  to  this  Paragraph 5,
directly  or indirectly, during the term of this Employment Agreement, engage in
any  activity  competitive  with  or  adverse  to  the Corporation's business or
welfare,  whether  alone,  as a partner, or as an officer, director, employee or
shareholder  of any other business entity, except that the ownership of not more
than  five  percent  (5%)  of  the  equity  securities  of  any  publicly traded
corporation  shall  not  be  deemed  a  violation  of  this  paragraph  5.2,
          5.3.  During  the term of employment, Employee will have access to and
acquire  various  confidential  knowledge,  including  without  limitation
compilations  of  information,  which are owned by the Corporation and which are
regularly  used  by  the  Corporation in the operation of its business. Employee
shall  not  disclose any of the aforesaid trade secrets, directly or indirectly,
or  use  them in any way, either during the term of this Employment Agreement or
at  any time thereafter, except as required in the course of his employment. All
files,  records,  documents  and,  other  items  relating to the business of the
Corporation,  whether  prepared  by  Employee  or  otherwise  corning  into  his
possession,  shall  remain  the  exclusive  property  of  the  Corporation.

     6.  Benefits.
         ---------
          6.1.  Employee  shall  receive  medical  and  disability insurance and
other  fringe benefits on a basis not less favorable as the same are extended to
other  key  employees  of  the  Corporation.

          6.2.  Employee  shall  be  entitled  in  each year of the term of this
Employment  Agreement  to such vacation and sick leave as shall be determined by
the Board of Directors, during which time his compensation pursuant to Paragraph
3  hereof,  shall  be  paid  in  full.

          6.3.   Throughout  the  term  of this Agreement, The Corporation shall
provide  and pay for a mobile telephone and a credit card for Employee's use for
gas  and  company  related  expenses.

     7.  Expenses.  Subject  to  written policies, which may be established from
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time  to  time  by  the  Board  of  Directors  of  the  Corporation, Employee is
authorized to incur reasonable expenses in performing his obligations hereunder,
including  expenses for entertainment, travel and similar items. The Corporation
agrees  to  reimburse Employee for all such expenses upon presentation from time
to  time  of  itemized  accounts  of  such  expenditures,

     8.  Termination.
         ------------
          8.1.  The  employment  of  Employee hereunder may be terminated at any
time  by  action  of  the  Corporation's  Board  of  Directors:
          8.1.1.  Upon  thirty  (30)  days  prior written notice in the event of
illness  or permanent disability of Employee resulting in a failure to discharge
substantially his duties under this Employment Agreement for a period of six (6)
consecutive  months or a total of two hundred ten (210) days during any calendar
year, and upon such termination, Employee shall be entitled to receive and shall
be  paid  all  compensation pursuant to Paragraph 3 hereof through and including
the  date  of  termination;  or

<PAGE>
          8.1.2.  At  any  time  upon  the  occurrence of any one or more of the
following  events:
          8.1.2.1.  Employee's  repeated  intentional  failure  or  refusal  to
perform such duties consistent with his capacity as Director of the Corporation;
          8.1.2.2.  Employee's  fraud, dishonesty or other willful misconduct in
the  performance  of  services  on  behalf  of  the  Corporation;  or
          8.1.2.3.  A  material  breach  of  any  provision  of  this Employment
Agreement  that has not been corrected by Employee within thirty (30) days after
receipt  by  him of written notice of such breach, in which case the Corporation
shall  not  be required to pay any further compensation to Employee, Termination
of  Employee's  employment  under this Paragraph 8 shall not be in limitation of
any  other  right  or remedy that the Corporation may have under this Employment
Agreement  or  otherwise.

     8.2 Employee may terminate this Employment Agreement upon a material breach
of  any  provision  of this Employment Agreement by the Corporation that has not
been corrected by the Corporation within thirty (30) days after receipt by it of
written  notice  of  such  breach.

     8.3  This  Employment  Agreement  shall  not  be  terminated  by any of the
following:
          8.3.1  Merger  or  consolidation  where  the  Corporation  is  not the
resulting  or surviving  corporation  or  entity;  or
          8.3.2  Transfer of substantially all of the assets of the Corporation.
In  the  event  of  any  such  merger,  consolidation or transfer of assets, the
surviving  or  resulting  corporation  or  entity  or  the  transferee  of  the
Corporation's  assets  shall  remain  bound  by and shall continue to obtain the
benefits  of  the  provisions  of  this  Agreement.

     9.  Renewal.  This  Employment Agreement shall be automatically renewed for
         -------
successive  one  (1) year periods, unless written notice of termination is given
by  one party to the other party not less than three (3) months prior to the end
of  the  term  hereof  or  any  renewal  hereof.  For  any  renewal  period, the
compensation  to  be  paid  by  the Corporation to Employee shall be as mutually
determined by the Corporation and Employee but is to be not less than the amount
paid  pursuant  to  Paragraph  3.1.

     10.  Severable  Provisions. The provisions of this Employment Agreement are
          ----------------------
severable,  and  if  any  one or more provisions are determined to be illegal or
otherwise  unenforceable,  in  whole  or in part, the remaining provisions shall
nevertheless  be  binding  and  enforceable.

     11.  Waiver.  Either party's failure to enforce any provision or provisions
          -------
of  this  Employment  Agreement shall not in any way be construed as a waiver of
any  such  provision,  or  provisions  as  to  any future violation thereof, nor
prevent  that  party thereafter from enforcing each and every other provision of
this  Employment  Agreement.  The  rights  granted to both parties hereunder are
cumulative  and  waiver  of  any  single remedy shall not constitute a waiver of
either  party's  right to assert all other legal remedies available to him or it
under  the  circumstances.

     12.  Merger  Clause.  This  Employment  Agreement  supersedes  all  prior
          ---------------
agreements  and  understandings  between  the  parties  and may not be modified,

<PAGE>
waived  or  terminated  orally. No attempted modification, waiver or termination
shall  be  valid unless in writing and signed by the party against whom the same
is  sought  to  be  enforced.

     13.  Governing  Law.  This  Employment  Agreement  shall be governed by and
          ---------------
construed  in  accordance  with  the  laws  of  the  State  of  California,

     IN  WITNESS  WHEREOF, the parties hereto have duly executed this Employment
Agreement  effective  as  of  the  date  and  year  first  set  forth  above.

                                                    Valcom,  Inc.

                                               By:  /s/  Ron  Foster
                                                    ----------------------------
                                                    Ron Foster, its Secretary
                                                    And Executive Vice President

                                                    /s/  Vince  Vellardita
                                                    ----------------------------
                                                    Vince  Vellardita

<PAGE>PLACEMENT AGENT AGREEMENT

                                                         Dated November 19, 2004

Sterling Financial Investment Group, Inc.
1111 Brickell Avenue, Ste. 1375
Miami, FL 33131

Ladies and Gentlemen:

1.   Offering.
     --------

     A.   New  York  Health  Care, Inc., a New York corporation (the "Company"),
hereby  engages  Sterling  Financial  Investment  Group, Inc. ("Sterling" or the
"Placement  Agent")  to  act as its exclusive placement agent in connection with
the  issuance  and  sale by the Company (the "Offering") of $6,000,000 ("maximum
offering")/$4,000,000  ("minimum  offering")  of  shares of the Company's common
stock  ,  $.01  par  value  (the  "Common  Stock")  and five (5) year redeemable
warrants  for  the purchase of the Company's Common Stock ("Subscriber Warrants"
and  collectively  with  the Common Stock, the "Securities"). Sterling is hereby
authorized to engage, at Sterling's option, the services of other broker-dealers
who are members of the National Association of Securities Dealers, Inc. ("NASD")
to assist Sterling in soliciting subscribers and to remit to such broker-dealers
the  commissions  payable  to  Sterling  hereunder  as Sterling shall determine.

          The  Offering  is subject to (i) the terms and conditions set forth in
the  Company's Confidential Private Offering Memorandum dated September 23, 2004
(such  memorandum  with all amendments and exhibits thereto (the "Memorandum")).
The  Offering is also subject to a subscription agreement to be executed by each
purchaser  of  the  Common  Stock  and  Subscriber  Warrants  and  the  Company
(collectively,  the  "Subscription  Agreements") (The Subscription Agreement and
the  Memorandum  are collectively referred to as the "Offering Documents"). Upon
successful consummation of the Offering by Sterling, the Company shall issue and
sell  to  Sterling  or its designee(s), for nominal consideration, five (5) year
placement  agent  warrants  (as  defined)  to  purchase that number of shares of
Common Stock equal to 15% of the sum of (i) the number of shares of Common Stock
and  (ii)  shares  underlying  the Subscriber Warrants sold in the Offering (the
"Placement Agent Warrants"). The Placement Agent Warrants shall have an exercise
price  equal  to  100%  of  the  price  at which the Common Stock is sold in the
Offering.  The  Placement  Agent  Warrants  will  also  have a cashless exercise
provision as well as standard anti-dilution provisions (i.e. stock splits, stock
dividends,  recapitalizations).  The  Common Stock, the Subscriber Warrants, the
Placement  Agent  Warrants, the shares of Common Stock underlying the Subscriber
Warrants  (the  "Subscriber  Warrant  Shares")  and  the  shares of Common Stock
underlying  the  Placement  Agent  Warrants  (the  "Placement Agent Shares") are
hereinafter  sometimes  collectively referred to as the "Securities." The Common
Stock  and  Subscriber  Warrants  will be offered without registration under the
Securities  Act  of  1933,  as amended (the "Securities Act"). Purchasers of the
Common Stock and Subscriber Warrants will be granted certain registration rights
with  respect  to  the  Common  Stock  and  the  Subscriber

<PAGE>
Warrant Shares as more fully set forth in the Subscription Agreements.  Sterling
will  be granted certain registration rights with respect to the Placement Agent
Shares  as  more  fully  set  forth in the Placement Agent Warrants, which terms
shall be no more favorable than any registration rights granted to the investors
in  the  Offering.

     B.     The Common Stock and Subscriber Warrants will be offered by Sterling
on  a "best efforts," "all or none" basis as to the minimum offering and a "best
efforts"  as  to  the remaining amount.  The Company will issue the certificates
representing  the  Common  Stock  and  the Subscriber Warrants at a closing (the
"Closing")  after  subscriptions  have been received and accepted by the Company
and  when  funds  from  investors  have cleared the banking system in the normal
course  of  business.

     C.   The  Offering shall terminate on the earliest of (i) the date that the
Company  and  Sterling, in our mutual discretion, may determine, or (ii) October
29,  2004,  unless  the  Company  and Sterling extend the Offering at their sole
discretion  by  up  to  an  additional  90  days (the "Offering Period"). If the
Offering  is not sold prior to the end of the Offering Period, the Offering will
be  terminated  and  all funds received from investors will be returned thereto,
without  interest  thereon  or  deduction  therefrom.  With  respect  to  any
subscriptions  that  are  received  by  Sterling  or  accepted  by  the  Company
subsequent  to  the  Offering  Period,  all  funds received by investors will be
returned  thereto,  without interest thereon or deduction therefrom. The Company
and  Placement  Agent  reserve  the  right  to  reject  any and all subscription
agreements  in  excess  of  the  minimum  Offering.

2.   Information.
     -----------

     A.   The  Common  Stock  and  Subscriber  Warrants shall have the terms set
forth in and shall be offered by the Company by means of the Offering Documents.
Payment  for  the  Common  Stock  shall  be  made  by check, money order or wire
transfer  as  more  fully  described  in the Subscription Agreement. The minimum
purchase  by  any  purchaser  shall  be $25,000, unless subscriptions for lesser
amounts are accepted at the discretion of the Company and Sterling. Sterling and
the  Company agree that the Common Stock and Subscriber Warrants will be offered
"accredited  investors"  within  the  meaning  of  Rule  501  of  Regulation  D
("Accredited  Investors")  promulgated by the Securities and Exchange Commission
(the  "Commission")  under the Securities Act and Rule 506 of Regulation D under
the  Securities  Act.

     B.   All  Funds  received  from  subscriptions  arranged  will  be promptly
transmitted  to the escrow account maintained at Wachovia Bank and designated as
New  York  Health  Care  Escrow Agreement, Wachovia Bank NA. In the event that a
Closing occurs, the funds received in respect of the Common Stock and Subscriber
Warrants  closed  on  will  be forwarded to the Company, against delivery of the
appropriate  amount  of the Common Stock and Subscriber Warrants offered, net of
(i)  the  placement  agent  commission  equal  to ten percent (10%) of the gross
proceeds  from  the  Common Stock and Subscriber Warrants; (ii) an unaccountable
expense  fee  of  three percent (3%) of the gross proceeds from the Common Stock
and  Warrant,  less  the  $35,000  paid  by  the Company on account; (iii) up to
$40,000  of  fees for counsel to the Placement Agent upon receipt by the Company
of  appropriate  documentation  thereof  and  (iv)  any  other costs paid by the
Placement  Agent  on  the  Company's  behalf,  which  are  obligations  of

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<PAGE>
the  Company  under  Section 7 hereof and which Placement Agent shall provide an
itemized  list  thereof.

     C.   The  Company  and Sterling reserve the right to reject any subscriber,
in  whole  or  in  part, in their sole discretion. Funds received by the Company
from  any  subscriber  whose  subscription  is rejected will be returned to such
subscriber,  without deduction therefrom or interest thereon, but no sooner than
such  funds  have  cleared  the banking system in the normal course of business.

3.   Representations,  Warranties  and  Covenants  of  Sterling.
     ----------------------------------------------------------

     Sterling  represents,  warrants  and  covenants  as  follows:

          (i)  Sterling has the necessary power to enter into this Agreement and
to  consummate  the  transactions  contemplated  hereby.

          (ii) The  execution and delivery by Sterling of this Agreement and the
consummation  of  the  transactions  contemplated  herein will not result in any
violation  of,  or  be  in  conflict  with,  or  constitute a default under, any
agreement or instrument to which Sterling is a party or by which Sterling or its
properties  are  bound,  or  any  judgment,  decree,  order  or,  to  Sterling's
knowledge,  any  statute,  rule  or  regulation  applicable  to  Sterling.  This
Agreement  constitutes  the  legal,  valid  and  binding obligation of Sterling,
enforceable  against Sterling in accordance with its terms, except to the extent
that  (a)  the  enforceability  hereof may be limited by bankruptcy, insolvency,
reorganization,  moratorium  or  similar  laws  from  time to time in effect and
affecting  the  rights  of creditors generally, (b) the enforceability hereof is
subject  to  general principles of equity, or (c) the indemnification provisions
hereof  may  be  held  to  be  violative  of  public  policy.

          (iii) Sterling will deliver to each purchaser, prior to any submission
by  such  person of a written offer relating to the purchase of the Common Stock
and Subscriber Warrants, a copy of the Offering Documents, as they may have been
most  recently  amended  or  supplemented  by  the  Company.

          (iv) Upon receipt of an executed Subscription Agreement, Sterling will
promptly  forward  copies  of  the  subscription  documents  to  the  Company.

          (v)  Sterling will not deliver the Offering Documents to any person it
does  not  reasonably believe to be an Accredited Investor or to any person in a
state  where it does not reasonably believe that the Offering is exempt from the
applicable  state  "Blue  Sky"  laws.

          (vi) Sterling  will  not  intentionally  take  any  action  which  it
reasonably  believes  would  cause the Offering to violate the provisions of the
Securities  Act,  the Securities Exchange Act of 1934, as amended (the "Exchange
Act") or the respective rules and regulations promulgated thereunder (the "Rules
and  Regulations").

          (vii)  Sterling  shall  use  all  commercially  reasonable  efforts to
determine  (a)  whether any prospective purchaser is an Accredited Investor; and
(b)  that  any  information  furnished  by  a  prospective  investor is true and
accurate.  Sterling  shall  have  no  obligation  to

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<PAGE>
insure  that (a) any check, note, draft or other means of payment for the Common
Stock  will be honored, paid or enforceable against the subscriber in accordance
with  its terms; or (b) subject to the performance of Sterling's obligations and
the  accuracy  of  Sterling's  representations and warranties hereunder, (i) the
Offering  is  exempt from the registration requirements of the Securities Act or
any  applicable  state  "Blue  Sky" law; or (ii) any prospective purchaser is an
Accredited  Investor.

          (viii)  Sterling  is  a  member  of  the  NASD  and is a broker-dealer
registered  as  such under the Exchange Act and under the securities laws of the
states  in  which  the Securities will be offered or sold by Sterling, unless an
exemption  for  such state registration is available to Sterling. Sterling is in
compliance  with  all  material  rules  and  regulations  applicable to Sterling
generally  and  to  Sterling's  participation  in  the  Offering.

4.   Representations  and  Warranties  of  the  Company.
     --------------------------------------------------

     The  Company  represents  and  warrants  as  follows:

          (i)  The  execution,  delivery  and  performance  of  each  of  this
Agreement,  the  Subscription  Agreements and the Escrow Agreement has been duly
and  validly  authorized  by  the  Company  and  is,  or  with  respect  to  the
Subscription Agreements, will be, a valid and binding obligation of the Company,
enforceable  in  accordance with its respective terms, except to the extent that
(a)  the  enforceability  hereof  or  thereof  may  be  limited  by  bankruptcy,
insolvency,  reorganization,  moratorium  or  similar  laws from time to time in
effect  and  affecting the rights of creditors generally, (b) the enforceability
hereof  or  thereof  is  subject  to  general  principles  of equity; or (c) the
indemnification  provisions  hereof  or  thereof  may be held to be violative of
public  policy.

          (ii) The  issuance, sale and delivery by the Company of the Securities
have  been  or  will  be  prior  to the Closing duly authorized by all requisite
corporate  action  of the Company. The Placement Agent Shares and the Subscriber
Warrant  Shares  will,  prior to the Closing, be duly reserved for issuance upon
exercise  of  the  Placement  Agent  Warrants  and  the  Subscriber  Warrants
respectively.

          (iii)  All  issued  and  outstanding securities of the Company and its
subsidiaries  have  been  duly  authorized  and  validly  issued, fully paid and
non-assessable  and  to  the  knowledge of the Company were issued in compliance
with  all  applicable  federal  and  state  securities laws except: (i) that the
Company  may  have  issued  shares  of  Common  Stock in January 2003 to certain
stockholders  (the  "BioBalance  Stockholders")  of  the  BioBalance Corporation
("BioBalance")  in  connection  with  the  Company's  acquisition  of BioBalance
without complying with certain state securities laws or (ii)where any such other
failure to comply would not likely have a material adverse effect on the Company
and  its  subsidiaries  taken as a whole ("MAE"); to the Company's knowledge the
holders  thereof  have  no  rights of rescission (except for any rights that the
BioBalance  Stockholders may have) or preemptive rights with respect thereto and
are  not  subject  to  personal  liability  solely  by  reason of being security
holders;  and  none of such securities was issued in violation of the preemptive
rights  of  any  holders  of  any  security  of  the  Company.  The  Company has
100,000,000  shares  of  authorized  Common  Stock,

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<PAGE>
24,939,776  shares of which are issued and outstanding as of the date hereof and
5,000,000 shares of authorized Preferred Stock, 590,375 of which are outstanding
on  the  date  hereof.

          (iv) Except as set forth in the Offering Documents or in the Company's
filing  with  the  Securities and Exchange Commission ("SEC Filings") there are:
(i) no outstanding options, warrants, rights (including conversion or preemptive
rights)  or  agreements pursuant to which the Company is or may become obligated
to issue, sell or repurchase any securities of the Company; (ii) no restrictions
on the transfer of the Company's capital stock imposed by the Company's Articles
of Incorporation or Bylaws or any agreement to which the Company is a party, any
order  of  any  court or any governmental agency to which the Company is subject
and  to  which  it  has knowledge or any statute known to the Company other than
those imposed by relevant state and federal securities laws; (iii) no cumulative
voting  or  preemptive  rights  for  any of the Company's capital stock; (iv) no
registration  rights  under  the  Securities  Act  with respect to the Company's
capital  stock; (v) no antidilution adjustment provisions or similar rights with
respect  to  the  outstanding securities of the Company will be triggered by the
issuance  of  the  Securities; (vi) no voting trusts or agreements, shareholders
agreements,  pledge  agreements, buy-sell, rights of first offer, negotiation or
refusal  or  proxies  or  similar arrangements relating to any securities of the
Company  to which the Company is a party; and (vii) to the best of the Company's
knowledge,  no  options  or  other  rights  to  purchase  securities  from  its
shareholders  granted  by  such  shareholders.

          (v)  The Common Stock, the Subscriber Warrant Shares and the Placement
Agent  Warrant  Shares,  when  issued  in  accordance  with  the  terms  of  the
Subscription Agreement, the Subscriber Warrants and the Placement Agent Warrants
and  the  terms  of  this Agreement, as the case may be, will be validly issued,
fully-paid and non-assessable. The holders of the Securities will not be subject
to  personal  liability  under the Company's Articles of Incorporation or Bylaws
or,  to  the  Company's  knowledge, under the New York Business Corporation Law,
solely  by  reason of being such holders; the Securities are not and will not be
subject  to  the preemptive rights of any holder of any security of the Company.

          (vi) Each  of the Company and its subsidiaries has good and marketable
title  to,  or valid and enforceable leasehold estates in, all items of real and
personal  property  necessary  to  conduct  its  business  (including,  without
limitation, any real or personal property stated in the Offering Documents or in
the  Company's  SEC  Filings  to  be  owned  or  leased  by  the Company and its
subsidiaries),  free  and  clear  of  all  liens, encumbrances, claims, security
interests  and  defects  of any material nature whatsoever, other than those set
forth  in  the  Offering Documents or in the Company's SEC Filings and liens for
taxes  not  yet  due and payable. All of the material leases and subleases under
which  the  Company  is the lessor or sublessor of properties or assets or under
which  the Company holds properties or assets as lessee or sublessee are in full
force and effect, and the Company is not in default in any material respect with
respect  to  any  of the terms or provisions of any of such leases or subleases,
and  no  material  claim  has  been  asserted by anyone adverse to rights of the
Company  as  lessor,  sublessor,  lessee or sublessee under any of the leases or
subleases  mentioned above, or affecting or questioning the right of the Company
to  continued possession of the leased or subleased premises or assets under any
such  lease  or  sublease.

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<PAGE>
          (vii)  Other  than  possible litigation that may be brought by a third
party  to  enjoin  the Company's currently proposed sale of its home health care
business, there is no material litigation or governmental proceeding pending or,
to  the  best  of  the Company's knowledge, threatened against, or involving the
Company or its subsidiaries or their properties or business, except as set forth
in  the  Offering  Documents or in the Company's SEC Filings. To the best of the
Company's  knowledge, the Company is not a party to any order, writ, injunction,
judgment  or  decree  of  any  court.

          (viii)  Each  of  the  Company  and  its  subsidiaries  has  been duly
organized  and  is  validly existing as a corporation in good standing under its
respective jurisdiction of incorporation, except for the BioBalance Corporation,
which  is  in  the  process  of  taking  the action necessary to regain its good
standing  status  in  the  State of Delaware (and which will be at the Closing).
Except  as  set forth in the Offering Documents or in the Company's SEC Filings,
the  Company does not own or control, directly or indirectly, an interest in any
other  corporation,  partnership, trust, joint venture or other business entity.
Except  as  set forth in the Offering Documents or in the Company's SEC Filings,
the  Company  owns  100%  of  the  outstanding  capital  stock  of  each  of its
subsidiaries.  Each  of  the  Company  and its subsidiaries is duly qualified or
licensed  and  in good standing as a foreign corporation in each jurisdiction in
which  the  character of its operations requires such qualification or licensing
and  where  failure  to so qualify would have a MAE. Each of the Company and its
subsidiaries  has  all requisite corporate power and authority, and all material
and  necessary  authorizations,  approvals,  orders,  licenses, certificates and
permits  of  and from all governmental regulatory officials and bodies (domestic
and  foreign)  to conduct its businesses (and proposed business) as described in
the  Offering Documents or in the Company's SEC Filings, and each of the Company
and  its  subsidiaries  is  doing  business  in  compliance  with  all  such
authorizations,  approvals,  orders,  licenses, certificates and permits and all
foreign,  federal,  state  and  local laws, rules and regulations concerning the
business  in  which  it  is engaged, except where failure to so comply would not
have  a MAE. Any disclosures in the Offering Documents concerning the effects of
foreign,  federal, state and local regulation on each of the Company's or in the
Company's  SEC  Filings  and its subsidiaries' businesses as currently conducted
and  as  contemplated  are correct in all material respects. The Company has all
corporate  power  and  authority  to enter into this Agreement, the Subscription
Agreements,  the  Common  Stock,  Subscriber  Warrants,  Escrow  Agreement  and
Placement  Agent  Warrants and to carry out the provisions and conditions hereof
and  thereof  and  to  issue,  sell  and  deliver  the  Securities. No consents,
authorizations,  approvals,  or  orders  of,  or  registration,  qualification,
declaration  or  filing with, any federal, state or local governmental authority
on  the  part of the Company is required in connection herewith and therewith or
to  issue,  sell  and  deliver  the  Securities,  other  than  registration  or
qualification,  or taking such action to secure exemption from such registration
or  qualification  of  the Securities under applicable state, federal or foreign
securities  laws,  which  actions  have been taken or will be taken prior to the
Closing.

          (ix) Each  of  the  Company  and  its  subsidiaries is not in material
breach of, or in material default under, any term or provision of any indenture,
mortgage,  deed  of  trust,  lease,  note, loan or credit agreement or any other
agreement  or  instrument  evidencing  an  obligation for borrowed money, or any
other  agreement  or  instrument to which it is a party or by which it or any of
its  properties may be bound, except where such breach or default would not have
a  MAE.  Each  of  the  Company  and its subsidiaries is not in violation of any
provision  of  its  charter  or

                                        6
<PAGE>
Bylaws  or  in  violation  of any material franchise, license, permit, judgment,
decree  or  order, or in violation of any statute, rule or regulation except for
the  violation  of  statutes,  rules  or regulations which would not have a MAE.
Neither  the  execution  and  delivery  of  this  Agreement and the Subscription
Agreements,  nor  the  issuance  and sale or delivery of the Securities, nor the
consummation  of  any  of  the  transactions  contemplated  herein  or  in  the
Subscription  Agreements,  nor  the  compliance  by  each of the Company and its
subsidiaries  with  the  terms  and provisions hereof or thereof, has conflicted
with  or  will  conflict with, or has resulted in or will result in a breach of,
any  of  the  terms  and  provisions of, or has constituted or will constitute a
default  under,  or has resulted in or will result in the creation or imposition
of  any  lien,  charge or encumbrance upon any property or assets of the Company
and  its  subsidiaries pursuant to the terms of any indenture, mortgage, deed of
trust,  note,  loan  or  credit  agreement  or any other agreement or instrument
evidencing  an  obligation  for  borrowed  money,  or  any  other  agreement  or
instrument to which the Company or its subsidiaries may be bound or to which any
of  the  property or assets of the Company or its subsidiaries is subject except
where  such  default, lien, charge or encumbrance would not have a MAE; nor will
such  action  result  in  any  violation of the provisions of the charter or the
Bylaws  of  each  of  the  Company  and  its  subsidiaries  or, assuming the due
performance  by  Sterling of its obligations hereunder, any statute, order, rule
or  regulation  applicable to the Company or its subsidiaries of any court or of
any  foreign,  federal,  state or other regulatory authority or other government
body  having  jurisdiction  over  each  of  the  Company  and  its subsidiaries.

          (x)  Neither the Company nor any of its officers, directors, employees
or  stockholders  has  employed  any  broker  or  finder  in connection with the
transactions contemplated by this Agreement other than Sterling and there are no
claims  for services in the nature of a finder's or origination fee with respect
to  the  sale  of  the  Securities.

          (xi) Each  of the Company and its subsidiaries owns or possesses, free
and  clear  of  all liens or encumbrances and rights thereto or therein by third
parties,  the  requisite licenses or other rights to use all trademarks, service
marks,  copyrights, service names, trade names, patents, patent applications and
licenses  necessary  to conduct its business (including, without limitation, any
such  license,  patent  or  rights described in the Offering Documents or in the
Company's SEC Filings as being owned or possessed by each of the Company and its
subsidiaries)  and  there  is no claim or action by any person pertaining to, or
proceeding,  pending or to the Company's knowledge, threatened, which challenges
the  rights  of  each  of  the  Company and its subsidiaries with respect to any
trademarks,  service  marks,  copyrights,  service  names, trade names, patents,
patent  applications  and  licenses used in the conduct of each of the Company's
and  its  subsidiaries'  businesses  (including,  without  limitation,  any such
licenses  or  rights described in the Offering Documents or in the Company's SEC
Filings as being owned or possessed by each of the Company and its subsidiaries)
except  any  claim  or  action  that  would  not  have a MAE; to the best of the
Company's  knowledge,  each  of  the  Company's  and  its  subsidiaries' current
products,  services  or  processes  do  not infringe or will not infringe on the
patents  currently  held  by  any  third  party.

          (xii)  Each  of  the  Company  and  its  subsidiaries is not under any
obligation  to  pay  royalties or fees of any kind whatsoever to any third party
with  respect to any trademarks, service marks, copyrights, service names, trade
names,  patents,  patent  applications,  licenses  or

                                        7
<PAGE>
technology  it  has  developed, uses, employs or intends to use or employ, other
than  to  their  respective  licensors.

          (xiii)  Subject  to  the  performance  by  Sterling of its obligations
hereunder,  and  the  accuracy of the representations and warranties made by the
respective  investors in the Subscription Agreements, the Offering Documents and
the  offer  and  sale  of  the  Securities  comply, and will continue to comply,
through  the  Offering  Period in all material respects with the requirements of
Rule  506  of  Regulation  D  promulgated  by  the  Commission  pursuant  to the
Securities  Act  and  any  other  applicable  federal  and  state  laws,  rules,
regulations  and  executive  orders.  Neither  the  Offering  Documents  nor any
amendment or supplement thereto, nor any other documents prepared by the Company
in  connection with the Offering 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. All statements of material facts in the Offering Documents
are  true  and correct as of the date of the Offering Documents and will be true
and  correct  in  all  material respects on the date of each Closing except with
respect  to  the  number of shares of Common Stock outstanding, which may change
between  the  date  hereof and the date of each Closing due to the conversion of
outstanding  securities  as  described in the Offering Documents. If at any time
prior  to  the completion of the Offering or other termination of this Agreement
any  event  shall occur as a result of which it might, in the Company's opinion,
become  necessary  to amend or supplement the Offering Documents so that they do
not  include  any  untrue  statement  of  any material fact or omit to state any
material fact necessary in order to make the statements therein, in light of the
circumstances  then  existing,  not misleading, the Company will promptly notify
Sterling and will supply Sterling with amendments or supplements correcting such
statement  or  omission.

          (xiv) All taxes which are due and payable from each of the Company and
its  subsidiaries  have  been  paid  in  full  or appropriate extensions of such
payment have been obtained and each of the Company and its subsidiaries does not
have  any  tax  deficiency or claim outstanding assessed or proposed against it.

          (xv) The  financial statements of the Company included in the Offering
Documents  and  in  the SEC filing fairly present the financial position, in all
material  respects,  of  the  Company  at the respective dates thereof; and such
financial  statements  have  been prepared in conformity with generally accepted
accounting  principles,  consistently  applied  throughout the periods involved,
except  that  such  financial  statements  are  subject to normal year end audit
adjustments and such financial statements do not contain all notes that would be
required  if  such  financial  statements  were  audited.

          (xvi)  Neither  the  Company  nor  its  subsidiaries  nor any of their
respective officers, directors, employees or agents, nor any other person acting
on behalf of the Company or its subsidiaries, has, directly or indirectly, given
or  agreed  to  give  any money, gift or similar benefit (other than legal price
concessions  to  customers  in the ordinary course of business) to any customer,
supplier,  employee  or agent of a customer or supplier, or official or employee
of  any  governmental  agency  or instrumentality of any government (domestic or
foreign) or any political party or candidate for office (domestic or foreign) or
other  person  who  is or may be in a position to help or hinder the business of
each  of  the  Company  or  its  subsidiaries  (or  assist  it  in

                                        8
<PAGE>
connection  with any actual or proposed transaction) which (A) might subject the
Company  and  its  subsidiaries  to any material damage or penalty in any civil,
criminal  or  governmental  litigation or proceeding, or (B) if not given in the
past,  might  have  had  a  materially adverse effect on the assets, business or
operations  of  the  Company  or  its  subsidiaries  as  reflected in any of the
financial  statements  contained  in  the  Offering  Documents,  or  (C)  if not
continued  in  the  future,  might  adversely  affect  the  assets,  business or
operations  of  the  Company  or  its  subsidiaries  in  the  future.

          (xvii)  The  Company  is  in compliance with all reporting obligations
under  the  Exchange Act and the Common Stock trades on the Pink Sheets; and the
Company  has  filed all documents required to be filed pursuant to all reporting
obligations,  under  either  Section  13(a)  or  15(d) of the Exchange Act since
December  31,  2002.  None  of  the  Company's filings with the Commission since
December  31,  2002  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  since  December  31,  2002;  the  Company  has timely filed all
requisite  forms, reports and exhibits thereto with the Commission, except where
such  failure  to timely file a form, report or exhibit will not have a MAE; and
all  reports  and  forms  filed  subsequent  thereto  by  the  Company  with the
Commission,  as amended, did 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.

          (xviii)  Assuming  (i) the accuracy of the information provided by the
respective  investors  in the Subscription Agreements and (ii) that Sterling has
complied in all material respects with its obligations under this Agreement and,
the  offer  and sale of the Common Stock and Subscriber Warrants pursuant to the
terms of the Offering Documents are exempt from the registration requirements of
the  Securities  Act  and  the  rules  and  regulations  promulgated thereunder.

          (xix)  When  the  Common  Stock,  the  Placement  Agent Shares and the
Subscriber  Warrant  Shares shall have been duly delivered to the purchasers and
payment  shall  have  been  made  therefor,  the  purchasers shall have good and
marketable title to the Common Stock, the Placement Agent Warrant Shares and the
Subscriber  Warrant  Shares,  as  the  case may be, free and clear of all liens,
encumbrances and claims whatsoever (with the exception of claims arising through
the  acts  or  omissions of the purchasers and except as arising from applicable
federal and state securities laws) and the Company shall have paid all taxes, if
any,  in  respect  of  the  original  issuance  thereof.

          (xx) The  Company  understands  that the foregoing representations and
warranties shall be deemed material and to have been relied upon by Sterling. No
representation  or  warranty  by  the  Company in this Agreement, and no written
statement  contained  in any document, certificate or other writing delivered by
the  Company to Sterling contains any untrue statement of material fact or omits
to  state  any material fact necessary to make the statements herein or therein,
in  light  of  the  circumstances  under  which  they were made, not misleading.

                                        9
<PAGE>
          (xxi) Upon receipt of an executed Subscription Agreement, Company will
promptly  forward  to  Sterling,  upon  Sterling's  request,  copies  of  the
subscription documents to the extent that Sterling does not already have copies.

          (xxii)  The  Company  will  not  deliver the Offering Documents to any
person  it  does  not  reasonably  believe  to  be  an  Accredited  Investor.

          (xxiii)  The  Company  will not intentionally take any action which it
reasonably  believes  would  cause the Offering to violate the provisions of the
Securities  Act,  Exchange  Act,  or  the  Rules  and  Regulations.

          (xxiv)  The  Company shall use all reasonable efforts to determine (a)
whether  any  prospective  purchaser  is an Accredited Investor and (b) that any
information  furnished  by  a  prospective  investor  is  true  and  accurate.

          (xxv)  Each  employee  of,  or  consultant  to,  the  Company  and any
subsidiary  who has or is proposed to have access to confidential or proprietary
information  of the Company or any subsidiary is a signatory to, and is bound by
an  agreement with, the Company or otherwise has a fiduciary duty to the Company
or  any  subsidiary,  relating  to  nondisclosure,  proprietary  information and
assignment  of  patent,  copyright  and  intellectual  property  rights.

5.   Certain  Covenants  and  Agreements  of  the  Company.
     -----------------------------------------------------

     The  Company covenants and agrees at its expense and without any expense to
Sterling  as  follows:

     A.   To  advise  Sterling  of any adverse change in the Company's financial
condition,  prospects or business or of any development materially affecting the
Company or rendering untrue or misleading any material statement in the Offering
Documents  occurring  at  any  time  prior  to  a  Closing as soon as reasonably
practicable  after  the  Company  is  either  informed or becomes aware thereof.

     B.   To  use  its  best  efforts to cause the Securities to be qualified or
registered  for  sale,  or  to  obtain  exemptions  from  such  qualification or
registration requirements, on terms consistent with those stated in the Offering
Documents,  the  Common  Stock,  the  Subscriber  Warrants,  the Placement Agent
Warrants, Subscriber Warrant Shares and Placement Agent Warrant Shares under the
securities  laws  of  such  jurisdictions  as Sterling shall reasonably request,
provided  that  such  states  and  jurisdictions  do  not require the Company to
qualify  as  a  foreign  corporation.  Qualification, registration and exemption
charges and fees shall be at the sole cost and expense of the Company. Company's
counsel  shall  perform  the  required  "Blue  Sky" services, and all reasonable
expenses  and  disbursements  of  Company's  counsel relating to such "Blue Sky"
matters  and  relating  to  the  Offering  shall  be  paid  by  the  Company.

     C.   To apply the net proceeds of the Offering as described in the Offering
Documents. Pending utilization, the net proceeds will be invested in short-term,
investment grade, interest bearing investments, money market funds, certificates
of  deposit  or  guaranteed  United  States  government  obligations.

                                       10
<PAGE>
     D.   To  provide  Sterling with as many copies of the Offering Documents as
Sterling  may  reasonably  request.

     E.   To comply with the terms of the Subscription Agreements, Common Stock,
Subscriber  Warrants,  and  Placement  Agent  Warrants,  including,  without
limitation,  the  registration  rights  provisions  thereof.

     F.   Subsequent  to the Offering Period, to use its commercially reasonable
efforts  to timely file all reports, forms or other documents as may be required
from time to time, under the Exchange Act and the Rules and Regulations, and all
such  reports,  forms  and  documents filed will comply as to form and substance
with  the  applicable  requirements  under  the  Exchange  Act and the Rules and
Regulations.

     G.   Neither  the  Company nor its subsidiaries nor any of their respective
officers, directors, stockholders or affiliates (within the meaning of the Rules
and  Regulations)  will take, directly or indirectly, any action designed to, or
which  might  in  the  future  reasonably  be  expected  to  cause or result in,
stabilization  or  manipulation  of  the price of any securities of the Company.

     H.   To  issue  to Sterling or its designees, at the Closing, the Placement
Agent  Warrants which shall be exercisable for a period of five years commencing
on  the  date  of issuance and terminating on the fifth anniversary of the final
Closing  as  evidenced  by  a placement agent warrant certificate of the Company
executed  and  delivered  to  Sterling  on  the date of such Closing which shall
provide  for  registration  by  the  Company  of  the  Placement  Agent  Shares.

     I.   To  keep  available out of its authorized and designated Common Stock,
solely for the purpose of issuance upon the exercise conversion of the Placement
Agent  Warrants  ,  the Common Stock and the Subscriber Warrants, such number of
shares  of  Common  Stock,  as  shall  then be issuable upon the exercise of all
outstanding  Common  Stock,  Placement  Agent  Warrants and Subscriber Warrants.

     J.   The Company shall upon Closing and in accordance with, and subject to,
the terms and conditions of the Purchase and Sale Agreement dated July 15, 2004,
and  related  escrow  agreement,  as such agreements may be amended, receive and
accept  the  resignations  of  Jerry  Braun and Jacob Rosenberg as directors and
executive  officers  of  the  Company.

6.   Indemnification.
     ---------------

     The Company agrees to indemnify and hold harmless Sterling, its affiliates,
the  directors,  officers  and  employees  of  Sterling  and  its affiliates and
subagent  or  selected  dealer,  and  each  other  person  or  entity,  if  any,
controlling  Sterling  or  any  of  its  affiliates  (collectively, "Indemnified
Persons"),  from  and against, and the Company agrees that no Indemnified Person
shall  have  any  liability  to  the Company or its owners, parents, affiliates,
securityholders  or  creditors  for, any losses, claims, damages, liabilities or
expenses  (including  actions,  claims  or  proceedings  in  respect  thereof
(collectively,  "Actions")  brought  by  or  against  any  person,  including
stockholders  of  the Company, and the cost of any investigation and preparation
therefore  and  defense  thereof)  (collectively,  "Losses")  (A)  related to or
arising  out  of  any

                                       11
<PAGE>
statements  or  omissions  made  in the Memorandum or any exhibit thereto or the
services,  commitment  or  other  obligations  undertaken or being considered by
Sterling  in this Agreement in connection with the sale of the Securities in the
Offering  (collectively,  "Sterling's  Role"),  except  that the indemnification
shall  not apply to the Losses of an Indemnified Person that are determined by a
court  of  competent  jurisdiction  in a final judgment not subject to appeal to
have  resulted from the bad faith or gross negligence of such Indemnified Person
or  to  Losses arising out of a claim under subsection (A) under this section as
to  an  alleged  omission from or misstatement in, the Memorandum or any exhibit
thereto  if  either (i) at or prior to the execution of a Subscription Agreement
the  copy  of  the  Memorandum  and  exhibits  were not sent or delivered to the
subscriber or (ii) the alleged untrue statement was corrected or the omission of
a  material  fact  alleged  was  contained  in  a supplement or amendment to the
Memorandum  that was delivered to the subscriber prior to the written acceptance
of  the  subscriber's  subscription  agreement  by  the  Company.

     Sterling  agrees  to  indemnify the Company, each of its executive officers
and  each  of its directors ( the "Company Indemnified Parties") from any Losses
that  may  be  incurred  by  any  Company  Indemnified  Party  relating  to  any
information  provided  by  Sterling for use in the Memorandum, which information
was  specifically  provided to the Company by Sterling in writing for the use in
such  Memorandum,  or  as a result of any arising from the breach by Sterling of
any of its representations and warranties contained in Section 3(iii), (v), (vi)
or  (vii)  of  this  Agreement.

     Promptly  after  receipt  by  an  Indemnified Person or Company Indemnified
Person  (each  an  "indemnified  party")  under  this Section 6 of notice of the
commencement  of  any action, such indemnified party will, if a claim in respect
thereof  is  to  be  made  against  any indemnifying party under this Section 6,
notify  in  writing the indemnifying party of the commencement thereof, however,
that no delay on the part of the indemnified party in notifying the indemnifying
party  shall relieve the indemnifying party from any obligation hereunder unless
the  indemnifying  party is prejudiced by such delay. In case any such action is
brought  against any indemnified party, and it notifies an indemnifying party of
the commencement thereof, the indemnifying party will be entitled to participate
therein, and to the extent that it may wish, jointly with any other indemnifying
party, similarly notified, to assume the defense thereof, with counsel who shall
be  to  the  reasonable satisfaction of such indemnified party, and after notice
from  the  indemnifying  party  to  such indemnified party of its election so to
assume  the  defense  thereof, the indemnifying party will not be liable to such
indemnified  party  under  this  Section  6  for  any  legal  or  other expenses
subsequently  incurred  by such indemnified party in connection with the defense
thereof  other  than  reasonable costs of investigation; provided, however, that
if, in the reasonable judgment of the indemnified party, it is advisable for the
indemnified  party  to be represented by separate counsel, the indemnified party
shall  have  the  right  to employ a single counsel to represent the indemnified
parties  who  may be subject to liability arising out of any claim in respect of
which  indemnity  may  be  sought by the indemnified parties thereof against the
indemnifying  party,  in  which  event  the  fees  and expenses of such separate
counsel  shall  be  borne by the indemnifying party. Any such indemnifying party
shall  not  be liable to any such indemnified party on account of any settlement
of  any  claim or action effected without the consent of such indemnifying party
which  consent  shall  not  be  unreasonably  withheld.

                                       12
<PAGE>
     If  such  an  indemnity  provided  for  in this Agreement is unavailable or
insufficient  for  any  Indemnified  Person with respect to any Losses, then the
indemnifying  party,  in  lieu  of  indemnifying  such  Indemnified Person, will
contribute  to the amount paid or payable by such Indemnified Person as a result
of  such  Losses  (i)  in  such  proportion  as it is appropriate to reflect the
relative  benefits received by the Company on the one hand, and Sterling, on the
other  hand,  from  the  Transactions, or (ii) if the allocation provided by (i)
above is not permitted by applicable law in such proportion as is appropriate to
reflect  not  only  the relative benefits referred to in (i) above, but also the
relative  fault  on  the  Company, on the one hand, and of Sterling on the other
hand  in connection with statements or omissions that resulted in Losses as well
as  any other relevant equitable considerations.  The relative benefits received
by  the Company on the one hand, and Sterling, on the other hand shall be deemed
to be in the same proportion as the total proceeds from the Transactions (net of
sales  commissions, but before deducting other expenses) received by the Company
bear  to  the  commissions  received  by  Sterling.  The  relative  fault of the
Company,  on  the  one hand, and Sterling, on the other hand, will be determined
with  reference  to,  among  other  things, whether the untrue or alleged untrue
statement  of  material fact or the omission to state a material fact relates to
the  information  supplied by the Company, on the one hand, and Sterling, on the
other  hand,  and  their  relative  intent, knowledge, access to information and
opportunity  to  correct  or  prevent  such  statement  or  omission.

     The  Company  and Sterling agree that it would not be just and equitable if
contribution  pursuant to this section were determined by pro rata allocation or
by  any other method of allocation that does not take into account the equitable
considerations  referred  to  in  the  immediately  preceding  paragraph.

     STERLING HEREBY AGREES AND THE COMPANY HEREBY AGREES, ON ITS OWN BEHALF AND
ON  BEHALF  OF  ITS  SECURITYHOLDERS,  TO  WAIVE ANY RIGHT TO TRIAL BY JURY WITH
RESPECT  TO ANY CLAIM, COUNTER-CLAIM OR ACTION ARISING OUT OF STERLING'S ROLE OR
THIS  PLACEMENT  AGENT  AGREEMENT.

7.   Payment  of  Expenses.
     ---------------------

     Whether  or  not the Offering is successfully completed, the Company hereby
agrees  to  bear all of its expenses in connection with the Offering, including,
but  not limited to the following:  filing fees, printing and duplicating costs,
advertisements, postage and mailing expenses with respect to the transmission of
offering  material,  registrar  and  transfer  agent fees, escrow agent fees and
expenses,  fees  of  the  Company's  counsel and accountants, issue and transfer
taxes,  if any, and "Blue Sky" counsel fees and expenses.  It is agreed that the
Company's  counsel  shall  perform  the  required  Blue  Sky legal services.  In
addition,  the  Company  shall  be  responsible  for  the  fees  and expenses of
Sterling's  counsel,  such  counsel  fees  not to exceed $40,000 upon receipt of
proper  documentation  of  such  expenses.

8.   Conditions  of  the  Closing
     ----------------------------

     Provided the Offering shall have been subscribed for and funds representing
such amount thereof shall have cleared, the Closing shall be held at the offices
of  Sterling's  counsel  or  such

                                       13
<PAGE>
other  place as mutually agreed upon by the parties. The obligations of Sterling
hereunder shall be subject to the continuing accuracy of the representations and
warranties,  in  all  material  respects,  of  the Company herein as of the date
hereof  and  as  of  the  date  of  the  Closing  as if such representations and
warranties  had  been  made on and as of such Closing; the accuracy on and as of
the  date  of each Closing of the statements of the officers of the Company made
pursuant  to the provisions hereof; and the performance by the Company on and as
of  each Closing of its covenants and obligations hereunder and to the following
further  conditions:

     A.   At  the  Closing,  Sterling  shall  receive the opinion of Blank Rome,
counsel to the Company, dated as of the date of the Closing, which opinion shall
be in form and substance reasonably satisfactory to counsel for Sterling, to the
effect  that:

          (i)  The  Company has the corporate power and authority to execute and
deliver  each  of  the  Subscription  Agreement,  this Agreement, the Subscriber
Warrants  and  Placement  Agent  Warrants  (collectively,  the  "Transaction
Documents")  and  to  consummate  the  transaction  provided  for  therein.  The
execution,  delivery  and  performance  of each of the Transaction Documents has
been duly and validly authorized by the Company and each Transaction Document is
a  valid  and  binding obligation of the Company, enforceable in accordance with
its  respective  terms.

          (ii) The  Shares  and Subscriber Warrants to be issued and sold by the
Company  pursuant  to  the  Memorandum and the Subscription Agreements have been
duly  authorized  by  the  Company.  The  Shares,  when  issued  and paid for in
accordance  with the Subscription Agreement, the Warrant Shares, when issued and
paid  for  in  accordance  with the Subscriber Warrants, and the Placement Agent
Shares, when issued and paid for in accordance with the Placement Agent Warrant,
will be validly issued, fully paid and non-assessable; the holders of the Shares
and Subscriber Warrants are not and will not be subject to personal liability to
third parties solely by reason of being such holders; the issuance of the Shares
and  the  Subscriber  Warrants are not and will not be subject to the preemptive
rights  under the laws of the New York Business Corporation Law or the Company's
Certificate of Incorporation and Bylaws; shareholder approval is not required to
consummate  the  sale  by  the  Company  of  its  securities  in the Offering as
contemplated  by  the  Memorandum  and this Agreement. The Shares and Subscriber
Warrants  conform  in  all  material respects to the description there of in the
Memorandum.

          (iii)  Each of the Company and its subsidiaries are duly organized and
are  validly  existing  as  a  corporation in good standing under its respective
jurisdiction  of  incorporation.

          (iv) The  authorized  capital  stock  of  the  Company  consists of an
aggregate  of  100,000,000  shares  of  Common  Stock  and  5,000,000  shares of
Preferred  Stock,  par  value  $.01  per  share.

          (v)  Neither  the  execution  and  delivery  of  the  Placement  Agent
Agreement,  or  the Subscription Agreement nor the issuance and sale or delivery
of  the Common Stock, the Subscriber Warrants, the Placement Agent Warrants, the
Subscriber  Warrant Shares or the Placement Agent Shares nor the consummation of
any  of  the  transactions  contemplated  in  the

                                       14
<PAGE>
Placement  Agent Agreement or the Subscription Agreements, nor the compliance by
the  Company  with the terms and provisions thereof, has conflicted with or will
conflict  with,  or  has  resulted  in or will result in a breach of, any of the
terms  and provisions of, or has constituted or will constitute a default under,
or  has  resulted  in  or  will result in any violation of the provisions of the
Certificate  of  Incorporation  or  the  Bylaws  of  the  Company.

          (vi) No consent, approval, authorization or order, and no filing with,
any  court, regulatory body, or governmental authority is required in connection
with the issuance of the Securities pursuant to the Offering, the performance by
the  Company  of  the Placement Agent Agreement, and the Subscription Agreements
and  the  transactions  contemplated thereby, except such as have been or may be
obtained  under  the Securities Act or may be required under state securities or
Blue  Sky  laws  in  connection  with  the  purchase  and  distribution  of  the
Securities.

          (vii)  Assuming that each purchaser of the Common Stock and Subscriber
Warrants is an Accredited Investor, that the representations made by the Company
and  Purchasers  in  the  Subscription Agreement and the Placement Agent in this
Agreement  are  true  and correct at all times during the Offering Period and at
the  time  of  the  Closing,  that  the  Placement  Agent  has complied with the
provisions  of  the Placement Agent Agreement and the provisions of Section 4(2)
of the Securities Act and Regulation D promulgated thereunder in connection with
the  offer  and  sale of the Shares and Subscriber Warrants, that the Company is
not  disqualified  under Rule 507 of the Securities Act from using the exemption
available  under  Rule  506  under the Securities Act, no registration under the
Securities  Act  is required in connection with the offer and sale of the Shares
and  Subscriber  Warrants,  subject  to  a timely filing of a Form D pursuant to
Regulation  D  promulgated  under  the  Securities Act. To the knowledge of such
counsel,  the  offering  and  sale  of the Shares and Subscriber Warrants in the
manner  contemplated  by the PA Agreement and the Transaction Documents will not
be  integrated,  as  defined  under  the  Securities Act, with any offering made
before  the  offer  and  sale  of  such securities in a manner that would render
unavailable  any  exemption  from  registration under the provisions of Sections
4(2)  of  the  Securities  Act  and  Regulation  D  promulgated  thereunder.

          In  rendering  such  opinion,  such counsel may rely (A) as to matters
involving  the  application of laws other than the laws of the United States and
jurisdictions  in  which  they  are  admitted,  to the extent such counsel deems
proper  and  to the extent specified in such opinion, if at all, upon an opinion
or  opinions (in form and substance satisfactory to Sterling's counsel) of other
counsel acceptable to Sterling's counsel, familiar with the applicable laws; (B)
as  to  matters  of  fact,  to  the extent they deem proper, on certificates and
written  statements  of  responsible officers of the Company and certificates or
other  written  statements  of  officers of departments of various jurisdictions
having  custody of documents respecting the corporate existence or good standing
of  the  Company,  provided  that  copies of any such statements or certificates
shall  be  delivered  to  Sterling's  counsel  if requested. The opinion of such
counsel  for  the Company shall state that the opinion of any such other counsel
is in form satisfactory to such counsel and that Sterling and they are justified
in  relying  thereon.

     B.   At  or  prior  to  the  Closing,  counsel for Sterling shall have been
furnished such documents, certificates and opinions as it may reasonably require
for the purpose of enabling it to review or pass upon the matters referred to in
this  Agreement  and  the  Offering  Documents,  or

                                       15
<PAGE>
in  order  to  evidence the accuracy, completeness or satisfaction of any of the
representations,  warranties  or  conditions  herein  contained.

     C.   At  and  prior  to  the Closing, (i) there shall have been no material
adverse  change  nor development involving a prospective change in the financial
condition  or  operations  except  where such change would not have a MAE or the
business activities, financial or otherwise, of the Company and its subsidiaries
from  the  latest  dates as of which such condition is set forth in the Offering
Documents;  (ii)  there  shall  have  been  no  material transaction, not in the
ordinary  course  of  business, entered into by the Company and its subsidiaries
which  has not been disclosed as having taken place or being contemplated in the
Offering  Documents  or  in the Company's SEC Filings or to Sterling in writing;
(iii)  the Company shall not be in default under any provision of any instrument
relating to any outstanding indebtedness for which a waiver or extension has not
been  otherwise  received  except  where such default would not have a MAE; (iv)
except  as  set forth in the Offering Documents or in the Company's SEC Filings,
the  Company shall not have issued any securities (other than those set forth in
the  Offering  Documents  or pursuant to the exercise of outstanding warrants or
options)  or  declared  or  paid  any  dividend  or made any distribution of its
capital  stock  of  any class and there shall not have been any material adverse
change in the indebtedness (long or short term) or liabilities or obligations of
the  Company  and  its  subsidiaries  (contingent or otherwise); (v) no material
amount of the assets of the Company and its subsidiaries shall have been pledged
or mortgaged, except with respect to assets in the normal course of business and
as  indicated in the Offering Documents or in the Company's SEC Filings; and (v)
no  action,  suit or proceeding, at law or in equity, against the Company or its
subsidiaries  or  affecting any of its properties or businesses shall be pending
or  threatened  before  or by any court or federal or state commission, board or
other  administrative  agency,  domestic  or  foreign,  wherein  an  unfavorable
decision,  ruling  or  finding  could  have  a  MAE,  except as set forth in the
Offering  Documents  or  in  the  Company's  SEC  Filings.

     D.   The  Offering  will  become  qualified or be exempt from qualification
under  the securities laws of the several states as contemplated by Section 5(B)
no  later  than the date of the Closing and no stop order suspending the sale of
the  Common  Stock  and  Subscriber  Warrants  shall  have  been  issued, and no
proceedings  for  that  purpose  shall  have  been  initiated  or  threatened.

     E.   At  the  Closing,  Sterling  shall  have received a certificate of the
Company signed by its chief executive officer and chief financial officer, dated
as  of  the  date of the Closing, to the effect that the conditions set forth in
subparagraph  (C)  above  have  been  satisfied  and that, as of the date of the
Closing,  the representations and warranties of the Company set forth herein are
true  and  correct.

     F.   At the Closing, the Company shall have duly executed and delivered the
appropriate  amount  and  designation of Common Stock and Subscriber Warrants to
the  respective  holders  thereof.

     G.   At the Closing, the Company shall duly and validly issue the Placement
Agent  Warrants  in  accordance  with  the  terms  hereof.

                                       16
<PAGE>
9.   Termination.
     -----------

     This  Agreement  shall  terminate  if  a  Closing does not take place on or
before  seven  (7) business days following the Offering Period.  Either Sterling
or  the  Company  may  terminate the Agreement in its sole discretion prior to a
Closing  upon  ten  (10)  days  prior written notice to the other party.  In the
event  that  the  Offering is not successfully completed, then the Company shall
immediately  pay  to Sterling  the amount of its out-of-pocket expenses incurred
in  connection  with  the offer of the Securities and pay all fees of counsel to
Sterling.  Upon  any termination of the Offering, all subscription documents and
payments  for the Securities not previously delivered to the purchasers thereof,
shall  be  returned  to  the respective subscribers, without interest thereon or
deduction  therefrom, and neither party hereto shall have any further obligation
to  each  other,  except  as  specifically  provided  herein.

10.  Residual  Period.
     ----------------

     In the event that Sterling introduces an investor to the Company during the
term  of  the  Offering and investor purchases any securities or debt within six
(6)  months of a closing or the termination of this Agreement, Sterling shall be
entitled  to  compensation in accordance with this Agreement, including cash and
Placement  Agent  Warrants.

11.  Miscellaneous.
     -------------

     A.   This  Agreement may be executed in any number of counterparts, each of
which shall be deemed to be an original, but all which shall be deemed to be one
and  the  same  instrument.

     B.   Any  notice required or permitted to be given hereunder shall be given
in  writing  and  shall  be deemed effective when deposited in the United States
mail,  postage  prepaid,  or  when  received  if  personally  delivered, sent by
overnight  courier  or  faxed,  addressed  as  follows:

     To  Sterling:

          Sterling  Financial  Investment  Group,  Inc.
          Mellon  Financial  Building
          1111  Brickell  Avenue,  Ste.  1375
          Miami,  FL  33131
          Fax:  (305)  728-1640
          Attention:  Ricardo  Rivas

     with  a  copy  to:

          Adorno  &  Yoss,  P.A.
          350  East  Las  Olas  Blvd.,  Suite  1700
          Fort  Lauderdale,  Florida  33301
          Fax:  (954)  766-7800
          Attention:  Joel  D.  Mayersohn,  Esq.

                                       17
<PAGE>
     to  the  Company:

          New  York  Health  Care,  Inc.
          1850  McDonald  Avenue
          Brooklyn,  New  York  11223
          Fax:  (718)  375-4007
          Attention:  Jacob  Rosenberg
          Vice  President  and  Chief  Operating  and  Financial  Officer

     with  a  copy  to:

          Blank  Rome
          405  Lexington  Avenue
          New  York,  New  York  10174
          Fax:  (212)  885-5001
          Attention:  Ethan  Seer,  Esq.

or  to  such  other  address  of  which  written  notice is given to the others.

     C.   This  Agreement  shall  be  governed  by and construed in all respects
under  the  laws  of  the State of Florida, without reference to its conflict of
laws rules or principles. Any suit, action, proceeding or litigation arising out
of  or relating to this Agreement shall be brought and prosecuted in any Florida
State  court  sitting  in the County of Florida and any Federal court sitting in
the  Southern  District  of the State of Florida. The parties hereby irrevocably
and  unconditionally  consent  to  the jurisdiction of each such court or courts
located  within  the State of Florida and to service of process by registered or
certified  mail,  return  receipt  requested, or by any other manner provided by
applicable  law,  and  hereby irrevocably and unconditionally waive any right to
claim  that  any  suit,  action,  proceeding or litigation so commenced has been
commenced  in  an  inconvenient  forum.

     D.   This  Agreement and the other agreements referenced herein contain the
entire  understanding  between  the  parties  hereto with respect to the subject
Offering  and  may not be modified or amended except by a writing duly signed by
the  party  against whom enforcement of the modification or amendment is sought.

     E.   If  any  provision  of  this  Agreement shall be held to be invalid or
unenforceable,  such  invalidity  or unenforceability shall not affect any other
provision  of  this  Agreement.

                                       18
<PAGE>
     IN  WITNESS  WHEREOF, the parties hereto have executed this Agreement as of
the  date  first  written  above.

                                              NEW YORK HEALTH CARE, INC.

                                              By: /s/ Jerry Braun
                                                 -------------------------------
                                              Name: Jerry  Braun
                                                    ----------------------------
                                              Title:  President  &  CEO
                                                      --------------------------

STERLING FINANCIAL
INVESTMENT GROUP, INC.

By: /s/ Ricardo A. Rivas
    ---------------------------------
Name: Ricardo A. Rivas
      -------------------------------
Title: Managing Director
       ------------------------------

                                       19
<PAGE>

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