Document:

AGREEMENT OF SETTLEMENT

      This Agreement of Settlement (the "Agreement") is entered into this day of
March 2005 (the "Closing Date"), by and among Tissera, Inc. (the "Company") and
the investors set forth on Exhibit A (the "Investors").

                              W I T N E S S E T H:

      WHEREAS, the Company and the Investors entered into a Subscription
Agreement dated March 18, 2004 (the "March 2004 Closing Date") whereby the
Investors, in consideration of an aggregate purchase price of $5,500,000,
purchased an aggregate of shares (the "March 2004 Shares") of the Company's
common stock, 3,142,858 Class A Common Stock Purchase Warrants ("Class A
Warrants") exercisable at $3.75 for a period of one year from the effective date
of the Form SB-2 Registration Statement, 3,142,858 Class B Common Stock Purchase
Warrants ("Class B Warrants") exercisable at $4.50 for a period of two years
from the March 2004 Closing Date, and 3,142,858 Class C Common Stock Purchase
Warrants ("Class C Warrants") exercisable at $6.00 for a period of three years
from the March 2004 Closing Date;

      WHEREAS, due to various actions taken by the former CEO of the Company, a
dispute has arisen between the Company and the Investors and the Investors have
threatened to commence legal action to enforce their rights;

      WHEREAS, in order to settle the aforementioned dispute the Company has
agreed to restructure the Class A Warrants, the Class B Warrants and the Class C
Warrants and issue the investors a Class D Common Stock Purchase Warrant ("Class
D Warrants") to purchase an amount of shares equal to 200% of the March 2004
Shares exercisable at $0.15 per share commencing on the date of issuance for a
period of one (1) year from the effective date of the Form SB-2 Registration
Statement (the "Form SB-2") to be filed registering the shares of common stock
underlying the Class A Warrants and the Class D Warrants; and

      WHEREAS, the Company and the Investors will execute a general mutual
release in favor of each other.

      NOW, THEREFORE, in consideration of the covenants, payments, and
agreements set forth in this Agreement, the Company and the Investors intending
to be legally bound thereby, and hereby warranting that they each have the
capacity and authority to execute this Agreement, it is agreed by and among the
undersigned parties, that all of the claims asserted (or which could have been
asserted) by the Investors are hereby settled and compromised on the following
terms and conditions, to wit:

      1. Compromise. In consideration for entering into the general mutual
releases as set forth in Section 2 of this Agreement, the Company and the
Investors agree as follows:

                                       1
<PAGE>

      (i)   The exercise price of the Class A Warrants, Class B Warrants and
            Class C Warrants will be reduced to $0.50 per share;

      (ii)  The term of the Class A Warrants will be extended to one (1) year
            from the effective date of the Form SB-2;

      (iii) The Company shall issue and sell to the Investors Class D Warrants,
            a form of which is attached hereto as Exhibit C, to purchase an
            amount of shares as set forth on Exhibit A, exercisable at $0.15 per
            share commencing on the date of issuance for a period of one (1)
            year from the effective date of the Form SB-2; and

      (iv)  The Company shall file with the Commission not later than sixty (60)
            days after the Closing Date (the "Filing Date"), and diligently
            cause to be declared effective within ninety (90) days after the
            Filing Date (the "Actual Effective Date"), the Form SB-2 in order to
            register the shares of common stock underlying the Class A Warrants
            and the Class D Warrants (the "Registrable Securities") for resale
            and distribution under the Securities Act of 1933, as amended;
            provided; however, if certain events outside of the control of the
            Company occur, such as an extended review of the Form SB-2 by the
            Securities and Exchange Commission, then the Actual Effective Date
            may be extended at the sole discretion of the Company. The
            Registrable Securities shall be reserved and set aside exclusively
            for the benefit of the Investors, pro rata, and not issued, employed
            or reserved for anyone other than each such Investor.

      2. Release. The parties shall execute general mutual releases in favor of
each other in the form annexed hereto as Exhibit B.

      3. Binding Agreement. The terms of this Agreement are binding upon and
inure to the benefit of each of the parties hereto, their respective successors,
assigns, dependents, and all other related persons, affiliates or associates.

      4. Headings. The captions of the paragraphs and sections of this Agreement
are provided solely for convenience, and are not intended to, and in fact, shall
not affect the substance or meaning of this Agreement.

      5. Representation. Each of the parties hereto represents that each has
read and fully understands each of the provisions as contained herein, and has
been afforded the opportunity to review same with his attorney of choice; and
further that each of the parties hereto represents that each and every one of
the provisions contained in this Agreement is fair and not unconscionable to
either party.

      6. Investor's Representations and Warranties. Each Investor hereby
represents and warrants to and agrees with the Company only as to such Investor
that:

                                       2
<PAGE>

      (i)   Information on Investor. The Investor is, and will be at the time of
            the exercise of any of the Class A Warrants, Class B Warrants, Class
            C Warrants and Class D Warrants (collectively, the "Warrants"), an
            "accredited investor", as such term is defined in Regulation D
            promulgated by the Commission under the Securities Act of 1933 (the
            "1933 Act"), is experienced in investments and business matters, has
            made investments of a speculative nature and has purchased
            securities of United States publicly-owned companies in private
            placements in the past and, with its representatives, has such
            knowledge and experience in financial, tax and other business
            matters as to enable the Investor to utilize the information made
            available by the Company to evaluate the merits and risks of and to
            make an informed investment decision with respect to the proposed
            issuance pursuant to this Agreement. The Investor has the authority
            and is duly and legally qualified to acquire and own the Warrants
            and the shares of common stock issuable upon exercise of the
            Warrants (collectively, the "Securities").

      (ii)  Compliance with Securities Act. The Investor understands and agrees
            that the Securities have not been registered under the 1933 Act or
            any applicable state securities laws, by reason of their issuance in
            a transaction that does not require registration under the 1933 Act
            (based in part on the accuracy of the representations and warranties
            of Investor contained herein), and that such Securities must be held
            indefinitely unless a subsequent disposition is registered under the
            1933 Act or any applicable state securities laws or is exempt from
            such registration.

      (iii) Legend. The shares of common stock underlying the Warrants shall
            bear the following or similar legend:

                  "THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
                  REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. THESE
                  SHARES MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR
                  HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
                  STATEMENT UNDER SUCH SECURITIES ACT OR ANY APPLICABLE STATE
                  SECURITIES LAW OR AN OPINION OF COUNSEL REASONABLY
                  SATISFACTORY TO TISSERA, INC. THAT SUCH REGISTRATION IS NOT
                  REQUIRED."

                                       3
<PAGE>
      (iv)  Warrants Legend. The Warrants shall bear the following or similar
            legend:

                  "THIS WARRANT AND THE COMMON SHARES ISSUABLE UPON EXERCISE OF
                  THIS WARRANT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT
                  OF 1933, AS AMENDED. THIS WARRANT AND THE COMMON SHARES
                  ISSUABLE UPON EXERCISE OF THIS WARRANT MAY NOT BE SOLD,
                  OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN
                  EFFECTIVE REGISTRATION STATEMENT AS TO THIS WARRANT UNDER SAID
                  ACT OR ANY APPLICABLE STATE SECURITIES LAW OR AN OPINION OF
                  COUNSEL REASONABLY SATISFACTORY TO TISSERA, INC. THAT SUCH
                  REGISTRATION IS NOT REQUIRED."

      7. Counterparts/Execution. This Agreement may be executed in any number of
counterparts and by the different signatories hereto on separate counterparts,
each of which, when so executed, shall be deemed an original, but all such
counterparts shall constitute but one and the same instrument. This Agreement
may be executed by facsimile signature and delivered by facsimile transmission.

      8. Entire Agreement; Assignment. This Agreement and other documents
delivered in connection herewith represent the entire agreement between the
parties hereto with respect to the subject matter hereof and may be amended only
by a writing executed by all parties. Neither the Company nor the Subscribers
have relied on any representations not contained or referred to in this
Agreement and the documents delivered herewith. No right or obligation of either
party shall be assigned by that party without prior notice to and the written
consent of the other party, which will not be unreasonably withheld.

      9. Law Governing this Agreement. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York without regard to
principles of conflicts of laws. Any action brought by either party against the
other concerning the transactions contemplated by this Agreement shall be
brought only in the state courts of New York or in the federal courts located in
the state of New York. The parties and the individuals executing this Agreement
and other agreements referred to herein or delivered in connection herewith on
behalf of the Company 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 Agreement or any other agreement delivered in connection
herewith 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 any agreement.

                                       4
<PAGE>

      IN WITNESS WHEREOF, the parties have read and executed this Agreement as
of the date and year first above written. TISSERA, INC.

By: __________________________
Name: Amos Eiran
Title:  Acting CEO

                                       5
<PAGE>

ALPHA CAPITAL AKTIENGESELLSCHAFT            WHALEHAVEN FUNDS LIMITED

By: _________________________________       By: ________________________________
Name:                                       Name:
Title:                                      Title:

STONESTREET LIMITED PARTNERSHIP             GENESIS MICROCAP INC.

By: _________________________________       By: ________________________________
Name:                                       Name:
Title:                                      Title:

VERTICAL VENTURES, LLC                      GENERATION CAPITAL ASSOCIATES

By: _________________________________       By: ________________________________
Name:                                       Name:
Title:                                      Title:

OMEGA CAPITAL SMALL CAP FUND, LTD.

By: _________________________________       ____________________________________
Name:                                       WAYNE SOKER
Title:

GREENWICH GROWTH FUND LIMITED               COUNTRYWIDE PARTNERS LLC

By: _________________________________       By: ________________________________
Name:                                       Name:
Title:                                      Title:

PLATINUM PARTNERS VALUE                     PLATINUM PARTNERS GLOBAL
ARBITRAGE FUND LP                           MACROFUND LP

By: _________________________________       By: ________________________________
Name:                                       Name:
Title:                                      Title:

BODNER FAMILY FOUNDATION                    JM INVESTORS

By: _________________________________       By: ________________________________
Name:                                       Name:
Title:                                      Title:

      [SIGNATURE PAGE TO THE AGREEMENT OF SETTLEMENT DATED MARCH [ ], 2005]

                                       6
<PAGE>

PROFESSIONAL TRADERS FUND, LLC              CAPE MAY INVESTORS INC.

By: _________________________________       By: ________________________________
Name:                                       Name:
Title:                                      Title:

GREENWOOD PARTNERS LP                       BRISTOL INVESTMENT FUND, LTD.

By: _________________________________       By: ________________________________
Name:                                       Name:
Title:                                      Title:

      [SIGNATURE PAGE TO THE AGREEMENT OF SETTLEMENT DATED MARCH [ ], 2005]

                                       7
<PAGE>

                                    EXHIBIT A

------------------------------------------------------------------------
SUBSCRIBER                                                    D WARRANTS
------------------------------------------------------------------------
ALPHA CAPITAL AKTIENGESELLSCHAFT                              1,142,856
Pradafant 7
9490 Furstentums
Vaduz, Lichtenstein
Fax: 011-42-32323196
------------------------------------------------------------------------
WHALEHAVEN FUNDS LIMITED                                        142,858
3rd Floor, 14 Par-Laville Road
Hamilton, Bermuda HM08
Fax: (441) 292-1373
------------------------------------------------------------------------
STONESTREET LIMITED PARTNERSHIP                                 514,286
C/o Canaccord Capital Corporation
320 Bay Street, Suite 1300
Toronto, Ontario M5H 4A6, Canada
Fax: (416) 956-8989
------------------------------------------------------------------------
GENESIS MICROCAP INC.                                           228,572
483 Green Lanes
London N13 4BS, England
Attn: Lawrence S. Gibbons
Fax: 011-087-0127-5687
------------------------------------------------------------------------
VERTICAL VENTURES, LLC                                          685,714
641 Lexington Avenue, 26th Floor
New York, NY 10022
Fax: (212) 207-3452
------------------------------------------------------------------------
GENERATION CAPITAL ASSOCIATES                                   240,000
1085 Riverside Trace
Atlanta, GA 30328
Fax: (404) 257-3125
------------------------------------------------------------------------
OMEGA CAPITAL SMALL CAP FUND, LTD.                              228,572
5516 14th Avenue
Brooklyn, NY 11219
Fax: (718) 435-7584
------------------------------------------------------------------------
BRISTOL INVESTMENT FUND, LTD.                                   800,000
Caledonia House, Jennett Street
George Town, Grand Cayman
Cayman Islands
Fax: (323) 468-8307
------------------------------------------------------------------------
WAYNE SOKER                                                     114,286
55 Shaw Road
Chestnut Hill, MA 02467
Fax: (617) 264-7179
------------------------------------------------------------------------
GREENWICH GROWTH FUND LIMITED                                   114,286
3rd Floor, 14 Par-Laville Road
Hamilton, Bermuda HM08
Fax: (441) 292-1373
------------------------------------------------------------------------
COUNTRYWIDE PARTNERS LLC                                        114,286
152 West 57th Street, (54)th Floor
New York, NY 10019
Fax: (212) 581-0002
------------------------------------------------------------------------
PLATINUM PARTNERS VALUE ARBITRAGE FUND LP                       971,428
152 West 57th Street, (54)th Floor
New York, NY 10019
Fax: (212) 581-0002
------------------------------------------------------------------------

                                       9
<PAGE>

------------------------------------------------------------------------
SUBSCRIBER                                                    D WARRANTS
------------------------------------------------------------------------
PLATINUM PARTNERS GLOBAL MACROFUND LP                           228,572
152 West 57th Street, (54)th Floor
New York, NY 10019
Fax: (212) 581-0002
------------------------------------------------------------------------
BODNER FAMILY FOUNDATION                                        114,286
152 West 57th Street, (54)th Floor
New York, NY 10019
Fax: (212) 581-0002
------------------------------------------------------------------------
JM INVESTORS                                                    145,714
152 East 9th Street
Lakewood, NJ 08701
Fax: (732) 905-9049
------------------------------------------------------------------------
PROFESSIONAL TRADERS FUND, LLC                                  300,000
1400 Old Country Road, Suite 206
Westbury, NY 11590
Fax: (516) 228-8083
------------------------------------------------------------------------
CAPE MAY INVESTORS INC.                                         100,000
312 Central Avenue
Cape May Point, NJ 08212
Fax: (215) 886-5487
------------------------------------------------------------------------
GREENWOOD PARTNERS LP                                           100,000
261 Old York Road, Suite 424
Jenkintown, PA 19046
Fax: (215) 886-5487
------------------------------------------------------------------------

                                       8
<PAGE>

                                    EXHIBIT B

      To all to whom these Present shall come or may Concern, Know That

      ______________                                                as RELEASOR,

in consideration of the sum of: Ten Dollars and no cents ($10.00) and other
valuable consideration received from

      Tissera, Inc.                                                 as RELEASEE,

receipt whereof is hereby acknowledged, releases and discharges

      Tissera, Inc.

                  the RELEASEE, RELEASEE'S directors, officers, partners, past
and present employees, agents, administrators, holding company, parent company,
subsidiaries, successors, insurers, assigns, principals and past and present
control persons; provided, however, the aforementioned shall in no way be deemed
to include Dr. Vicki Rabenou, the RELEASEE's former CEO and director, from all
actions, cause of action, suits, debts, dues, sums of money, accounts,
reckonings, bonds, bills, specialties, covenants, contracts, controversies,
agreements, promises, variances, trespasses, damages, judgments, extents,
executions, claims, and demands whatsoever, in law, admiralty or equity, which
against the RELEASEE(S), the RELEASOR, RELEASOR'S directors, officers, partners,
past and present employees, agents, administrators, holding company, parent
company, subsidiaries, successors, insurers, assigns, principals and past and
present control persons ever had, now have or hereafter can, shall or may, have
for, upon, or by reason of any matter, cause or thing with respect to the
matters relating to or that has or may have arisen from the purchase of the
securities issued in connection with the private placement of the RELEASEE in
March 2004 by the RELEASOR from the beginning of the world to the day of the
date of this RELEASE.

      The words RELEASOR and RELEASEE include all releasors and all releasees
under this RELEASE.

      This RELEASE may not be changed orally.

      In Witness Whereof, the RELEASOR has hereunto set RELEASOR'S hand and seal
on the ___ day of _______________, 2005

                                               _________________________________

                                               By: _____________________________
                                               Name:
                                               Title:

                                       10
<PAGE>

      To all to whom these Present shall come or may Concern, Know That

      TISSERA, INC.                                                 as RELEASOR,

in consideration of the sum of: Ten Dollars and no cents ($10.00) and other
valuable consideration received from

      ________________________                                      as RELEASEE,

receipt whereof is hereby acknowledged, releases and discharges

      ________________________

                  the RELEASEE, RELEASEE'S directors, officers, partners, past
and present employees, agents, administrators, holding company, parent company,
subsidiaries, successors, insurers, assigns, principals and past and present
control persons, from all actions, cause of action, suits, debts, dues, sums of
money, accounts, reckonings, bonds, bills, specialties, covenants, contracts,
controversies, agreements, promises, variances, trespasses, damages, judgments,
extents, executions, claims, and demands whatsoever, in law, admiralty or
equity, which against the RELEASEE(S), the RELEASOR, RELEASOR'S directors,
officers, partners, past and present employees, agents, administrators, holding
company, parent company, subsidiaries, successors, insurers, assigns, principals
and past and present control persons ever had, now have or hereafter can, shall
or may, have for, upon, or by reason of any matter, cause or thing with respect
to the matters relating to or that has or may have arisen from the purchase of
the securities issued in connection with the private placement of the RELEASEE
in March 2004 by the RELEASOR from the beginning of the world to the day of the
date of this RELEASE.

      The words RELEASOR and RELEASEE include all releasors and all releasees
under this RELEASE.

      This RELEASE may not be changed orally.

      In Witness Whereof, the RELEASOR has hereunto set RELEASOR'S hand and seal
on the ____ day of ________________, 2005

                                              Tissera, Inc.

                                              By: ______________________________
                                              Name: Amos Eiran
                                              Title: Acting CEO

                                       11THIS WARRANT AND THE COMMON SHARES ISSUABLE UPON EXERCISE OF THIS WARRANT HAVE
NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. THIS WARRANT
AND THE COMMON SHARES ISSUABLE UPON EXERCISE OF THIS WARRANT MAY NOT BE SOLD,
OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE
REGISTRATION STATEMENT UNDER SAID ACT OR AN OPINION OF COUNSEL REASONABLY
SATISFACTORY TO TISSERA, INC. THAT SUCH REGISTRATION IS NOT REQUIRED.

                  Right to Purchase _________ shares of Common Stock of Tissera,
                                 Inc. (subject to adjustment as provided herein)

                         COMMON STOCK PURCHASE WARRANT D

No. 2004-D-001                                        Issue Date: March 16, 2005

      TISSERA, INC., a corporation organized under the laws of the State of
Washington (the "Company"), hereby certifies that, for value received,
_______________________________, _______________________________________, or its
assigns (the "Holder"), is entitled, subject to the terms set forth below, to
purchase from the Company at any time after the Issue Date until 5:00 p.m.,
E.S.T on the first anniversary of the Actual Effective Date (as defined in the
Settlement Agreement) (the "Expiration Date"), up to ________ fully paid and
nonassessable shares of the common stock of the Company (the "Common Stock"),
$.0001 par value per share at a per share purchase price of $0.15. The
aforedescribed purchase price per share, as adjusted from time to time as herein
provided, is referred to herein as the "Purchase Price." The number and
character of such shares of Common Stock and the Purchase Price are subject to
adjustment as provided herein. The Company may reduce the Purchase Price without
the consent of the Holder. Capitalized terms used and not otherwise defined
herein shall have the meanings set forth in that certain Settlement Agreement
(the "Settlement Agreement"), dated March 16, 2005, entered into by the Company
and the Holder.

      As used herein the following terms, unless the context otherwise requires,
have the following respective meanings:

      (a) The term "Company" shall include Tissera, Inc. and any corporation
which shall succeed or assume the obligations of Tissera, Inc. hereunder.

      (b) The term "Common Stock" includes (a) the Company's Common Stock,
$.0001 par value per share, as authorized on the date of the Settlement
Agreement, and (b) any other securities into which or for which any of the
securities described in (a) may be converted or exchanged pursuant to a plan of
recapitalization, reorganization, merger, sale of assets or otherwise.

      (c) The term "Other Securities" refers to any stock (other than Common
Stock) and other securities of the Company or any other person (corporate or
otherwise) which the holder of the Warrant at any time shall be entitled to
receive, or shall have received, on the exercise of the Warrant, in lieu of or
in addition to Common Stock, or which at any time shall be issuable or shall
have been issued in exchange for or in replacement of Common Stock or Other
Securities pursuant to Section 4 or otherwise.

                                       1
<PAGE>

      1. Exercise of Warrant.

            1.1. Number of Shares Issuable upon Exercise. From and after the
Issue Date through and including the Expiration Date, the Holder hereof shall be
entitled to receive, upon exercise of this Warrant in whole in accordance with
the terms of subsection 1.2 or upon exercise of this Warrant in part in
accordance with subsection 1.3, shares of Common Stock of the Company, subject
to adjustment pursuant to Section 4.

            1.2. Full Exercise. This Warrant may be exercised in full by the
Holder hereof by delivery of an original or facsimile copy of the form of
subscription attached as Exhibit A hereto (the "Subscription Form") duly
executed by such Holder and surrender of the original Warrant within seven (7)
days of exercise, to the Company at its principal office or at the office of its
Warrant Agent (as provided hereinafter), accompanied by payment, in cash, wire
transfer or by certified or official bank check payable to the order of the
Company, in the amount obtained by multiplying the number of shares of Common
Stock for which this Warrant is then exercisable by the Purchase Price then in
effect.

            1.3. Partial Exercise. This Warrant may be exercised in part (but
not for a fractional share) by surrender of this Warrant in the manner and at
the place provided in subsection 1.2 except that the amount payable by the
Holder on such partial exercise shall be the amount obtained by multiplying (a)
the number of whole shares of Common Stock designated by the Holder in the
Subscription Form by (b) the Purchase Price then in effect. On any such partial
exercise, the Company, at its expense, will forthwith issue and deliver to or
upon the order of the Holder hereof a new Warrant of like tenor, in the name of
the Holder hereof or as such Holder (upon payment by such Holder of any
applicable transfer taxes) may request, the whole number of shares of Common
Stock for which such Warrant may still be exercised.

            1.4. Fair Market Value. Fair Market Value of a share of Common Stock
as of a particular date (the "Determination Date") shall mean:

                  (a) If the Company's Common Stock is traded on an exchange or
is quoted on the National Association of Securities Dealers, Inc. Automated
Quotation ("NASDAQ"), National Market System, the NASDAQ SmallCap Market or the
American Stock Exchange, LLC, then the closing or last sale price, respectively,
reported for the last business day immediately preceding the Determination Date;

                  (b) If the Company's Common Stock is not traded on an exchange
or on the NASDAQ National Market System, the NASDAQ SmallCap Market or the
American Stock Exchange, Inc., but is traded in the over-the-counter market,
then the average of the closing bid and ask prices reported for the last
business day immediately preceding the Determination Date;

                  (c) Except as provided in clause (d) below, if the Company's
Common Stock is not publicly traded, then as the Holder and the Company agree,
or in the absence of such an agreement, by arbitration in accordance with the
rules then standing of the American Arbitration Association, before a single
arbitrator to be chosen from a panel of persons qualified by education and
training to pass on the matter to be decided; or

                  (d) If the Determination Date is the date of a liquidation,
dissolution or winding up, or any event deemed to be a liquidation, dissolution
or winding up pursuant to the Company's charter, then all amounts to be payable
per share to holders of the Common Stock pursuant to the charter in the event of
such liquidation, dissolution or winding up, plus all other amounts to be
payable per share in respect of the Common Stock in liquidation under the
charter, assuming for the purposes of this clause (d) that all of the shares of
Common Stock then issuable upon exercise of all of the Warrants are outstanding
at the Determination Date.

                                       2
<PAGE>

            1.5. Company Acknowledgment. The Company will, at the time of the
exercise of the Warrant, upon the request of the Holder hereof acknowledge in
writing its continuing obligation to afford to such Holder any rights to which
such Holder shall continue to be entitled after such exercise in accordance with
the provisions of this Warrant. If the Holder shall fail to make any such
request, such failure shall not affect the continuing obligation of the Company
to afford to such Holder any such rights.

            1.6. Trustee for Warrant Holders. In the event that a bank or trust
company shall have been appointed as trustee for the Holder of the Warrants
pursuant to Subsection 3.2, such bank or trust company shall have all the powers
and duties of a warrant agent (as hereinafter described) and shall accept, in
its own name for the account of the Company or such successor person as may be
entitled thereto, all amounts otherwise payable to the Company or such
successor, as the case may be, on exercise of this Warrant pursuant to this
Section 1.

            1.7 Delivery of Stock Certificates, etc. on Exercise. The Company
agrees that the shares of Common Stock purchased upon exercise of this Warrant
shall be deemed to be issued to the Holder hereof 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 as aforesaid. As soon as
practicable after the exercise of this Warrant in full or in part, and in any
event within five (5) days thereafter, the Company at its expense (including the
payment by it of any applicable issue taxes) will cause to be issued in the name
of and delivered to the Holder hereof, or as such Holder (upon payment by such
Holder of any applicable transfer taxes) may direct in compliance with
applicable securities laws, a certificate or certificates for the number of duly
and validly issued, fully paid and nonassessable shares of Common Stock (or
Other Securities) to which such Holder shall be entitled on such exercise, plus,
in lieu of any fractional share to which such Holder would otherwise be
entitled, cash equal to such fraction multiplied by the then Fair Market Value
of one full share of Common Stock, together with any other stock or other
securities and property (including cash, where applicable) to which such Holder
is entitled upon such exercise pursuant to Section 1 or otherwise.

      2. Cashless Exercise.

            (a) If a Registration Statement as defined in the Settlement
Agreement ("Registration Statement") is effective and the Holder may sell its
shares of Common Stock upon exercise hereof, this Warrant may be exercisable in
whole or in part for cash only as set forth in Section 1 above. If no such
Registration Statement is available, payment upon exercise may be made at the
option of the Holder either in (i) cash, wire transfer or by certified or
official bank check payable to the order of the Company equal to the applicable
aggregate Purchase Price, (ii) by delivery of Common Stock issuable upon
exercise of the Warrants in accordance with Section (b) below or (iii) by a
combination of any of the foregoing methods, for the number of Common Stock
specified in such form (as such exercise number shall be adjusted to reflect any
adjustment in the total number of shares of Common Stock issuable to the holder
per the terms of this Warrant) and the holder shall thereupon be entitled to
receive the number of duly authorized, validly issued, fully-paid and
non-assessable shares of Common Stock (or Other Securities) determined as
provided herein.

            (b) Notwithstanding any provisions herein to the contrary, if the
Fair Market Value of one share of Common Stock is greater than the Purchase
Price (at the date of calculation as set forth below), in lieu of exercising
this Warrant for cash, the holder may elect to receive shares equal to the value
(as determined below) of this Warrant (or the portion thereof being cancelled)
by surrender of this Warrant at the principal office of the Company together
with the properly endorsed Subscription Form in which event the Company shall
issue to the holder a number of shares of Common Stock computed using the
following formula:

                                       3
<PAGE>

          X=Y (A-B)
          ---------
              A

  Where   X=     the number of shares of Common Stock to be issued to the holder

          Y=     the number of shares of Common Stock
                 purchasable under the Warrant or, if only a
                 portion of the Warrant is being exercised,
                 the portion of the Warrant being exercised
                 (at the date of such calculation)

          A=     the Fair Market Value of one share of the
                 Company's Common Stock (at the date of such
                 calculation)

          B=     Purchase Price (as adjusted to the date of such calculation)

            (c) The Holder may employ the cashless exercise feature described
above only during such time that the registration statement as described in the
Settlement Agreement is not effective.

            (d) For purposes of Rule 144 promulgated under the 1933 Act, it is
intended, understood and acknowledged that the Warrant Shares issued in a
cashless exercise transaction shall be deemed to have been acquired by the
Holder, and the holding period for the Warrant Shares shall be deemed to have
commenced, on the date this Warrant was originally issued pursuant to the
Settlement Agreement.

      3. Adjustment for Reorganization, Consolidation, Merger, etc.

            3.1. Reorganization, Consolidation, Merger, etc. In case at any time
or from time to time, the Company shall (a) effect a reorganization, (b)
consolidate with or merge into any other person or (c) transfer all or
substantially all of its properties or assets to any other person under any plan
or arrangement contemplating the dissolution of the Company, then, in each such
case, as a condition to the consummation of such a transaction, proper and
adequate provision shall be made by the Company whereby the Holder of this
Warrant, on the exercise hereof as provided in Section 1, at any time after the
consummation of such reorganization, consolidation or merger or the effective
date of such dissolution, as the case may be, shall receive, in lieu of the
Common Stock (or Other Securities) issuable on such exercise prior to such
consummation or such effective date, the stock and other securities and property
(including cash) to which such Holder would have been entitled upon such
consummation or in connection with such dissolution, as the case may be, if such
Holder had so exercised this Warrant, immediately prior thereto, all subject to
further adjustment thereafter as provided in Section 4.

            3.2. Dissolution. In the event of any dissolution of the Company
following the transfer of all or substantially all of its properties or assets,
the Company, prior to such dissolution, shall at its expense deliver or cause to
be delivered the stock and other securities and property (including cash, where
applicable) receivable by the Holder of the Warrants after the effective date of
such dissolution pursuant to this Section 3 to a bank or trust company (a
"Trustee") having its principal office in New York, NY, as trustee for the
Holder of the Warrants.

                                       4
<PAGE>

            3.3. Continuation of Terms. Upon any reorganization, consolidation,
merger or transfer (and any dissolution following any transfer) referred to in
this Section 3, this Warrant shall continue in full force and effect and the
terms hereof shall be applicable to the Other Securities and property receivable
on the exercise of this Warrant after the consummation of such reorganization,
consolidation or merger or the effective date of dissolution following any such
transfer, as the case may be, and shall be binding upon the issuer of any Other
Securities, including, in the case of any such transfer, the person acquiring
all or substantially all of the properties or assets of the Company, whether or
not such person shall have expressly assumed the terms of this Warrant as
provided in Section 4. In the event this Warrant does not continue in full force
and effect after the consummation of the transaction described in this Section
3, then only in such event will the Company's securities and property (including
cash, where applicable) receivable by the Holder of the Warrants be delivered to
the Trustee as contemplated by Section 3.2.

      4. Extraordinary Events Regarding Common Stock. In the event that the
Company shall (a) issue additional shares of the Common Stock as a dividend or
other distribution on outstanding Common Stock, (b) subdivide its outstanding
shares of Common Stock, or (c) combine its outstanding shares of the Common
Stock into a smaller number of shares of the Common Stock, then, in each such
event, the Purchase Price shall, simultaneously with the happening of such
event, be adjusted by multiplying the then Purchase Price by a fraction, the
numerator of which shall be the number of shares of Common Stock outstanding
immediately prior to such event and the denominator of which shall be the number
of shares of Common Stock outstanding immediately after such event, and the
product so obtained shall thereafter be the Purchase Price then in effect. The
Purchase Price, as so adjusted, shall be readjusted in the same manner upon the
happening of any successive event or events described herein in this Section 4.
The number of shares of Common Stock that the Holder of this Warrant shall
thereafter, on the exercise hereof as provided in Section 1, be entitled to
receive shall be adjusted to a number determined by multiplying the number of
shares of Common Stock that would otherwise (but for the provisions of this
Section 4) be issuable on such exercise by a fraction of which (a) the numerator
is the Purchase Price that would otherwise (but for the provisions of this
Section 4) be in effect, and (b) the denominator is the Purchase Price in effect
on the date of such exercise.

      5. Certificate as to Adjustments. In each case of any adjustment or
readjustment in the shares of Common Stock (or Other Securities) issuable on the
exercise of the Warrants, 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 (a) the consideration received or receivable by the Company for any
additional shares of Common Stock (or Other Securities) issued or sold or deemed
to have been issued or sold, (b) the number of shares of Common Stock (or Other
Securities) outstanding or deemed to be outstanding, and (c) the Purchase Price
and the number of shares of Common Stock 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
mail a copy of each such certificate to the Holder of the Warrant and any
Warrant Agent of the Company (appointed pursuant to Section 11 hereof).

      6. Reservation of Stock, etc. Issuable on Exercise of Warrant; Financial
Statements. The Company will at all times reserve and keep available, solely for
issuance and delivery on the exercise of the Warrants, all shares of Common
Stock (or Other Securities) from time to time issuable on the exercise of the
Warrant. This Warrant entitles the Holder hereof to receive copies of all
financial and other information distributed or required to be distributed to the
holders of the Company's Common Stock.

                                       5
<PAGE>

      7. 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"). 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
an opinion of counsel reasonably satisfactory to the Company that the transfer
of this Warrant will be in compliance with applicable securities laws, the
Company at its expense, twice, only, 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 Warrant or Warrants of like tenor, 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.

      8. Replacement of Warrant. On receipt of evidence reasonably satisfactory
to the Company of the loss, theft, destruction or mutilation of this Warrant
and, in the case of any such loss, theft or destruction of this Warrant, on
delivery of an indemnity agreement or security reasonably satisfactory in form
and amount to the Company or, in the case of any such mutilation, on surrender
and cancellation of this Warrant, the Company at its expense, twice only, will
execute and deliver, in lieu thereof, a new Warrant of like tenor.

      9. Maximum Exercise. The Holder shall not be entitled to exercise this
Warrant on an exercise date in connection with that number of Common Stock which
would be in excess of the sum of (i) the number of Common Stock beneficially
owned by the Holder and its affiliates on an exercise date or Call Date, and
(ii) the number of Common Stock issuable upon the exercise of this Warrant with
respect to which the determination of this limitation is being made on an
exercise date or Call Date, which would result in beneficial ownership by the
Holder and its affiliates of more than 4.99% of the outstanding Common Stock on
such date. For the purposes of the immediately preceding sentence, beneficial
ownership shall be determined in accordance with Section 13(d) of the Securities
Exchange Act of 1934, as amended, and Regulation 13d-3 thereunder. Subject to
the foregoing, the Holder shall not be limited to aggregate exercises which
would result in the issuance of more than 4.99%. The restriction described in
this paragraph may be revoked upon sixty-one (61) days prior notice from the
Holder to the Company. The Holder may allocate which of the equity of the
Company deemed beneficially owned by the Subscriber shall be included in the
4.99% amount described above and which shall be allocated to the excess above
4.99%.

      10. Warrant Agent. The Company may, by written notice to the Holder of the
Warrant, appoint an agent (a "Warrant Agent") for the purpose of issuing Common
Stock (or Other Securities) on the exercise of this Warrant pursuant to Section
1, exchanging this Warrant pursuant to Section 7, and replacing this Warrant
pursuant to Section 8, or any of the foregoing, and thereafter any such
issuance, exchange or replacement, as the case may be, shall be made at such
office by such Warrant Agent.

      11. Transfer on the Company's Books. Until this Warrant is transferred on
the books of the Company, the Company may treat the registered holder hereof as
the absolute owner hereof for all purposes, notwithstanding any notice to the
contrary.

      12. Notices. All notices, demands, requests, consents, approvals, and
other communications required or permitted hereunder shall be in writing and,
unless otherwise specified herein, shall be (i) personally served, (ii)
deposited in the mail, registered or certified, return receipt requested,
postage prepaid, (iii) delivered by reputable air courier service with charges
prepaid, or (iv) transmitted by hand delivery, telegram, or facsimile, addressed
as set forth below or to such other address as such party shall have specified
most recently by written notice. Any notice or other communication required or

                                       6
<PAGE>

permitted to be given hereunder shall be deemed effective (a) upon hand delivery
or delivery by facsimile, with accurate confirmation generated by the
transmitting facsimile machine, at the address or number designated below (if
delivered on a business day during normal business hours where such notice is to
be received), or the first business day following such delivery (if delivered
other than on a business day during normal business hours where such notice is
to be received) or (b) on the second business day following the date of mailing
by express courier service, fully prepaid, addressed to such address, or upon
actual receipt of such mailing, whichever shall first occur. The addresses for
such communications shall be: (i) if to the Company to: Tissera, Inc., Galgaley
Haplada 11, Third entrance, 3rd floor, Herzlia 46733 Israel, Attn: Amos Eiran,
Acting Chief Executive Officer, telecopier: 011-972-9-9574318, with a copy by
telecopier only to: Sichenzia Ross Friedman Ference LLP, 1065 Avenue of the
Americas, New York, NY 10018, Attn: Gregory Sichenzia, Esq., telecopier: (212)
930-9725, (ii) if to the Holder, to the address and telecopier number listed on
the first paragraph of this Warrant.

      13. Miscellaneous. This Warrant and any term hereof may be changed,
waived, discharged or terminated only by an instrument in writing signed by the
party against which enforcement of such change, waiver, discharge or termination
is sought. This Warrant shall be construed and enforced in accordance with and
governed by the laws of New York. Any dispute relating to this Warrant shall be
adjudicated in New York County in the State of New York. 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.

      IN WITNESS WHEREOF, the Company has executed this Warrant as of the date
first written above.

                                              TISSERA, INC.

                                              By: ______________________________
                                                  Name:
                                                  Title:

Witness:

________________________________

                                       7
<PAGE>

                                    Exhibit A

                              FORM OF SUBSCRIPTION

                   (to be signed only on exercise of Warrant)

TO:  TISSERA, INC.

The undersigned, pursuant to the provisions set forth in the attached Warrant
(No.____), hereby irrevocably elects to purchase (check applicable box):

___   ________ shares of the Common Stock covered by such Warrant; or

___   the maximum number of shares of Common Stock covered by such Warrant
pursuant to the cashless exercise procedure set forth in Section 2.

The undersigned herewith makes payment of the full purchase price for such
shares at the price per share provided for in such Warrant, which is
$___________. Such payment takes the form of (check applicable box or boxes):

___   $__________ in lawful money of the United States; and/or

___   the cancellation of such portion of the attached Warrant as is exercisable
for a total of _______ shares of Common Stock (using a Fair Market Value of
$_______ per share for purposes of this calculation); and/or

___   the cancellation of such number of shares of Common Stock as is necessary,
in accordance with the formula set forth in Section 2, to exercise this Warrant
with respect to the maximum number of shares of Common Stock purchasable
pursuant to the cashless exercise procedure set forth in Section 2.

The undersigned requests that the certificates for such shares be issued in the
name of, and delivered to _____________________________________________________
whose address is ______________________________________________________________
______________________________________________________________________________.

The undersigned represents and warrants that all offers and sales by the
undersigned of the securities issuable upon exercise of the within Warrant shall
be made pursuant to registration of the Common Stock under the Securities Act of
1933, as amended (the "Securities Act"), or pursuant to an exemption from
registration under the Securities Act.

Dated:___________________                   ____________________________________
                                            (Signature must conform to name of
                                            holder as specified on the face of
                                            the Warrant)

                                            ____________________________________

                                            ____________________________________
                                            (Address)

                                       8
<PAGE>

                                    Exhibit B

                         FORM OF TRANSFEROR ENDORSEMENT

                   (To be signed only on transfer of Warrant)

                  For value received, the undersigned hereby sells, assigns, and
transfers unto the person(s) named below under the heading "Transferees" the
right represented by the within Warrant to purchase the percentage and number of
shares of Common Stock of TISSERA, INC. to which the within Warrant relates
specified under the headings "Percentage Transferred" and "Number Transferred,"
respectively, opposite the name(s) of such person(s) and appoints each such
person Attorney to transfer its respective right on the books of TISSERA, INC.
with full power of substitution in the premises.

--------------------------------------------------------------------------------
Transferees               Percentage Transferred            Number Transferred
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

Dated:  ______________, ___________         ____________________________________
                                             (Signature must conform to name of
                                             holder as specified on the face of
                                             the warrant)

Signed in the presence of:

___________________________________         ____________________________________
              (Name)
                                            ____________________________________
                                                (address)

ACCEPTED AND AGREED:
[TRANSFEREE]                                ____________________________________

                                            ____________________________________
                                                (address)

___________________________________
              (Name)

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