Document:

Exhibit 4.2

    
      
        

      

    

    EXHIBIT
      4.2

    

    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 UNDER SAID ACT OR AN OPINION OF COUNSEL REASONABLY
      SATISFACTORY TO THE MEDICAL EXCHANGE INC. THAT SUCH REGISTRATION IS NOT
      REQUIRED.

    

    
      	 	
              Right
                to Purchase ________ shares of Common Stock of The Medical Exchange
                Inc.
                (subject to adjustment as provided
                herein)

            

    

    

    FORM
      OF CLASS A COMMON STOCK PURCHASE WARRANT

     

    
      
        	No. 2007-A-001	
                Issue
                  Date: February ___, 2007

              

      

    

     

    The
      Medical Exchange Inc., a corporation organized under the laws of the State
      of
      Nevada (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
      fifth anniversary of the Actual Effective Date (as defined in Section 11.1(iv)
      of the Subscription Agreement) (the “Expiration Date”), ________ fully paid and
      nonassessable shares of Common Stock at a per share purchase price of $5.00.
      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 Subscription Agreement
      (the “Subscription
      Agreement”),
      dated
      February ___, 2007, entered into by the Company and Holders.

    

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

     

    (a)       
       The
      term
“Company” shall mean The
      Medical Exchange Inc.
      and any
      corporation which shall succeed or assume the obligations of The
      Medical Exchange Inc.
      hereunder. 

     

    (b)         The
      term
“Common Stock” includes (a) the Company’s common stock, $0.001 par value
      per share, as authorized on the date of the Subscription 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 5 or otherwise. 

     

    (d)         The
      term
“Warrant Shares” shall mean the Common Stock issuable upon exercise of this
      Warrant.

     

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

     

    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, 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 four (4) 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
      for the balance of.

     

    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 Capital 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 Capital 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

        
          

        

      

      
        
        

      

    

     

    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 qualified 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 four (4) business
      days
      thereafter (“Warrant Share Delivery Date”), 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.
      The Company understands that a delay in the delivery of the Warrant Shares
      after
      the Warrant Share Delivery Date could result in economic loss to the Holder.
      As
      compensation to the Holder for such loss, the Company agrees to pay (as
      liquidated damages and not as a penalty) to the Holder for late issuance of
      Warrant Shares upon exercise of this Warrant the amount of $100 per business
      day
      after the Warrant Share Delivery Date for each $10,000 of Purchase Price of
      Warrant Shares for which this Warrant is exercised which are not timely
      delivered. The Company shall pay any payments incurred under this Section in
      immediately available funds upon demand. Furthermore, in addition to any other
      remedies which may be available to the Holder, in the event that the Company
      fails for any reason to effect delivery of the Warrant Shares by the Warrant
      Share Delivery Date, the Holder may revoke all or part of the relevant Warrant
      exercise by delivery of a notice to such effect to the Company whereupon the
      Company and the Holder shall each be restored to their respective positions
      immediately prior to the exercise of the relevant portion of this Warrant,
      except that the liquidated damages described above shall be payable through
      the
      date notice of revocation or rescission is given to the Company. 

     

    2.         
      Cashless
      Exercise.

     

    (a)         
      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 cashless
      exercise in accordance with Section (b) below or (iii) by a
      combination of any of the foregoing methods, for the number of shares 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.

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    (b)         
      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:

     

     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
                  average of the three highest closing sale prices of the Common
                  Stock for
                  the five (5) Trading Days immediately prior to (but not including)
                  the
                  Exercise Date

              
	 	 	 	 
	 	 	
                B=

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

              

      

    

     

    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 Subscription
      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
      in
      accordance with Section 3.1 by the Holder upon their exercise 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. 

     

    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

        
          

        

      

      
        
        

      

    

     

    3.4         
      Share
      Issuance.
      Until
      the Expiration Date, if the Company shall issue any Common Stock except for
      the
      Excepted Issuances (as defined in the Subscription Agreement), prior to the
      complete exercise of this Warrant for a consideration less than the Purchase
      Price that would be in effect at the time of such issue, then, and thereafter
      successively upon each such issue, the Purchase Price shall be reduced to such
      other lower purchase price. For purposes of this adjustment, the issuance of
      any
      security or debt instrument of the Company carrying the right to convert such
      security or debt instrument into Common Stock or of any warrant, right or option
      to purchase Common Stock shall result in an adjustment to the Purchase Price
      upon the issuance of the above-described security, debt instrument, warrant,
      right, or option if such issuance is at a price lower than the Purchase Price
      in
      effect upon such issuance. The reduction of the Purchase Price described in
      this
      Section 3.4 is subject to the provisions of, and in addition to the other rights
      of the Holder described in, the Subscription Agreement.

     

    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 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 issued or sold or deemed to have
      been
      issued or sold, (b) the number of shares of Common Stock 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 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

        
          

        

      

      
        
        

      

    

     

    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. No such transfers shall result in a public
      distribution of the Warrant.

     

    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.         
      Registration
      Rights.
      The
      Holder of this Warrant has been granted certain registration rights by the
      Company. These registration rights are set forth in the Subscription Agreement.
      The terms of the Subscription Agreement are incorporated herein by this
      reference.

     

    10.        
      Maximum
      Exercise.
      The
      Holder shall not be entitled to exercise this Warrant on an exercise
      date, in
      connection with that number of shares of Common Stock which would be in excess
      of the sum of (i) the number of shares of Common Stock beneficially owned
      by the Holder and its affiliates on an exercise date, and (ii) the number
      of shares 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, which would result in beneficial ownership by the Holder and
      its
      affiliates of not more than 4.99% of the outstanding shares of 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 be limited to aggregate exercises
      which would result in the issuance of more than 4.99%. The
      Holder may decide whether to convert a Convertible Note or exercise this Warrant
      to achieve an actual 4.99% ownership position as described above.

     

    11.        
      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 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. 

     

    12.        
      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. 

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

     

    13.        
      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 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 or
      (c)
      three business days after deposited in the mail if delivered pursuant to
      subsection (ii) above.
      The
      addresses for such communications shall be: (i) if to the Company to:
The
      Medical Exchange Inc., 17 State Street, New York, NY 10004, with
      a
      copy by telecopier only to: Aboudi & Brounstein, 3 Gavish St., Kfar Saba,
      Israel, Fax: 972-9-764-4834, and (ii) if to the Holder, to the addresses and
      telecopier number set forth in the first paragraph of this Warrant, with an
      additional copy by telecopier only to: Grushko & Mittman, P.C., 551 Fifth
      Avenue, Suite 1601, New York, New York 10176, telecopier number: (212)
      697-3575.

     

    14.        
      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. 

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

     

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

     

    
      	 	 	 
	 	THE
              MEDICAL
              EXCHANGE INC.
	 
 	 
 	 
 
	 	By:  	 
	 	
              

            
	 	Name:
              
Title: 

    

     

    

      Witness:

       

      

      ______________________________________

    

     

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

     

    Exhibit A

    FORM
      OF
      SUBSCRIPTION

    (to
      be
      signed only on exercise of Warrant)

    TO:
      The
      Medical Exchange 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 the Warrant to the extent 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
      __________________________________________________________________________________________________________________________________________

    Number
      of
      Shares of Common Stock Beneficially Owned on the date of exercise: Less
      than
      five percent (5%) of the outstanding Common Stock of The Medical Exchange
      Inc.

    The
      undersigned represents and warrants that the representations and warranties
      in
      Section 4 of the Subscription Agreement (as defined in this Warrant) are true
      and accurate with respect to the undersigned on the date hereof.

    

    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)

    

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

     

    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 The Medical Exchange 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 The Medical
      Exchange 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)Exhibit 10.1

    
      

    

    Exhibit
      10.1

    SECURITIES
      PURCHASE AGREEMENT 

     

    THIS
      SECURITIES PURCHASE AGREEMENT
      is made
      and entered into as of July 19, 2006, among The Medical Exchange Inc., a
      Nevada corporation (the “Purchaser”),
      IDO
      Securities Limited., a company incorporated under the laws of the State of
      Israel (the “Company”)
      and
      the
      selling shareholders whose
      names, addresses and signatures are set forth on the Signature Pages to this
      Agreement (the “Vendors”
and
      collectively with Purchaser and Company, the “Parties”). 

    

    W
      I T N E S S E T B H

     

    WHEREAS,
      the
      Company currently has 50,000 shares of NIS 1.00 par value per share of ordinary
      shares (“Company
      Shares”)
      authorized, of which 1,025 shares are outstanding as of the date hereof ,
      and

    

    WHEREAS,
      as of
      the date hereof the Vendors own the number of Company Shares of the Company
      set
      forth opposite their name on the Appendix
      A
      to this
      Agreement which comprise all of the issued and outstanding Company Shares
(the
      “Purchased
      Shares”);
      and

    

    WHEREAS,
      the
      Purchaser and the Vendors believe that it is desirable and in their mutual
      best
      interests that Purchaser acquires
      100% of the issued and outstanding Company Shares upon the terms and conditions
      set forth herein, which upon the Closing of the Purchase according to this
      Agreement would make Company a wholly owned subsidiary of the Purchaser;
      and

    

    WHEREAS
      the
      Parties desire to make certain representations, warranties, covenants and
      agreements in connection with the Purchase and also to prescribe various
      conditions to the Purchase.

     

    NOW,
      THEREFORE,
      in
      consideration of the foregoing and the mutual covenants and agreements herein
      contained, and intending to be legally bound hereby, the Company, the Purchaser
      and the Vendors hereby agree as follows:

     

    ARTICLE
      I

     

    Purchase
      & Sale

     

    1.1        
      Agreement
      for Purchase and Sale Subject
      to the terms and conditions hereof:

    

    (a)
      the
      Vendors agree to sell, assign and transfer to the Purchaser and the Purchaser
      agrees to purchase the Purchased Shares and any loans which Vendors have
      outstanding against Company (set forth in the audited financial statements
      of
      the Company the “Loans”)
      (together, the “Purchase”).

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    (b)
      The
      Purchaser shall use reasonable commercial efforts to cause the Company’s bank to
      release Vendors from their personal guarantees with respect to Company debt
      and
      accounts. As of the date hereof the sole personal guarantee of Vendors is from
      Gil Stiss to Company’s bank. Prior to Closing Gil shall void his said personal
      guarantee. 

    

    1.2        
      Closing.
      The
      closing of the Purchase (the “Closing”)
      will
      take place on the date the Parties agree upon after satisfaction or waiver
      of
      the conditions set forth in Article VII, and no later than 31 August 2006 (the
      “Closing
      Date”).

    

    1.3        
      Directors.
      At the
      Closing the following persons shall be appointed as directors of the Company
      until the earlier of their resignation or removal or until their respective
      successors are duly elected and qualified, as the case may be: 

     

    Gil
      Stiss, Irit Reiner and Michael Goldberg.

    

    1.4        
      Purchase
      Price

    

     Amount
      of Purchase Price.
      At
      Closing the aggregate purchase price payable by the Purchaser to the Vendors
      for
      the Purchase shall be the sum of One Million US Dollars ($1,000,000) (the
“Purchase
      Price”)
      to be
      paid to each of the Vendors as set forth opposite their respective names in
      Appendix
      A.

    

    ARTICLE
      II

    

    Representations
      & Warranties of Vendors

     

    2.0        
      Vendors
      Representations & Warranties.
      Each
      Vendor represents and warrants to the Purchaser that:

    

    2.1        
      Ownership
      and Right to Sell Purchased Shares.
      The
      Vendor beneficially owns and controls and has good and marketable title to
      the
      Purchased Shares registered in the Vendor’s name free and clear of any and all
      mortgages, charges, liens, pledges, encumbrances, demands, security interest
      or
      claims of others (the “Liens”)
      and
      has the absolute right, power and authority to sell, transfer and assign the
      said Purchased Shares to the Purchaser in accordance with the terms and
      conditions herein contained.

    

    2.2        
      No
      Litigation against Purchased Shares.
      The
      Vendor is not aware of any injunctions, judgments, orders, legal actions, or
      similar proceedings, either threatened, pending or outstanding, against or
      relating to the Purchased Shares or the Vendor which would or could affect
      or
      prohibit the completion by the Vendor of the transactions contemplated
      hereby.

    

    2.3        
      No
      Litigation against Vendor.
      There
      are no actions, suits, claims, complaints, judgments, injunctions, orders,
      awards, executions or legal, administrative, arbitrations or similar
      proceedings, governmental investigations, or other proceedings pending or
      threatened against or affecting the Vendor at law or in equity or before any
      state, municipal or other government department, commission, board, bureau,
      agency or instrumentality, domestic or foreign which would or could affect
      or
      prohibit the completion by the Vendor of the transactions contemplated
      hereby.

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    2.4        
      No
      Options.
      No
      party other than the Purchaser under this Agreement has any agreement or option
      or any right capable of becoming an agreement or option for the purchase from
      the Vendor of the Purchased Shares. As of the Closing the Vendors waive any
      rights of first refusal that they have towards the other Vendors and terminate
      any and all shareholder agreements amongst or between Vendors.

    

    2.5        
      Non
      contravention.
      The
      execution, delivery and performance of this Agreement and all other agreements
      and documents required to be executed, issued or delivered by the Vendor
      hereunder is not in contravention of any of the terms of any indenture, trust
      deed, bond, mortgage, charge, debenture, agreement or undertaking to which
      the
      Vendor is a party or by which the Vendor is bound.

    

    2.6        
      Representation.
      Each
      Vendor acknowledges that it has had the opportunity to consult with legal
      counsel respecting this Agreement. 

     

    2.7        
      It
      is
      agreed and understood that the representations and warranties set out in this
      Section 2 from each of the Vendors relates only to the specific Vendor and
      that
      specific Vendor’s common shares in the capital of the Corporation representing
      part of the Purchased Shares and such representations and warranties shall
      not
      extend to or include any representations and warranties in respect of any of
      the
      other Vendors. 

    

    2.8        
      Waiver
      & Releases by Each Vendor.
      Each
      Vendor (on his behalf and on behalf of each of his agents, attorneys, heirs,
      successors, executors, personal representatives and assigns) does hereby
      absolutely and unconditionally waive, release and forever discharge each of
      the
      Company, its affiliates and subsidiaries, their respective past, present and
      future officers, directors, shareholders, employees, agents, attorneys,
      successors and assigns, from any claims, demands, obligations, liabilities,
      rights, causes of action and damages, whether liquidated or unliquidated,
      absolute or contingent, known or unknown, from the beginning of time to the
      date
      of the Closing. This
      Section 2.8 shall not affect any of Gil Stiss’ rights against the Company as
      detailed in the employment agreement attached hereto as Appendix
      6.5.

     

    ARTICLE
      III

     

    Representations
      and Warranties of the President of the Company and the Company

     

    As
      of the
      date hereof and as of the Closing, except as otherwise provided in the
      Disclosure Schedule, the Company
      represents and warrants to the Purchaser and Gil Stiss, President of the
      Company, represents and warrants to the Purchaser to the best of his knowledge
      and belief (for the purposes of this Agreement, “best of his knowledge and
      belief” shall mean the actual knowledge of Gil Stiss and the knowledge Gil Stiss
      would reasonably be expected to have in his capacity as President of the
      Company) that:

    

    3.1        
      Organization.
      The
      Company is a corporation duly organized, validly existing under the laws of
      the
      State of Israel and has all requisite corporate power and authority to carry
      on
      its business as now being conducted, except where the failure to be so
      organized, existing and in good standing or to have such power and authority
      could not be reasonably expected to (i) prevent or materially delay the
      consummation of the Purchaser, or (ii) have a material adverse effect (as
      defined in Section 9.3) on the Company. The Company is duly qualified or
      licensed to do business and in good standing in each jurisdiction in which
      the
      property owned, leased or operated by it or the nature of the business conducted
      by it makes such qualification or licensing necessary, except in such
      jurisdictions where the failure to be so duly qualified or licensed and in
      good
      standing could not reasonably be expected to have a material adverse effect
      on
      the Company or prevent or materially delay the consummation of the Purchase.
      The
      Company has made available to the Purchase complete and correct copies of its
      Articles of Association and Certificate of Incorporation.

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    3.2        
      No
      Subsidiaries.
      The
      Company does not own, directly or indirectly, any capital stock or other
      ownership interest in any corporation, partnership, joint venture or other
      entity.

    

    3.3        
      Capitalization.
      The
      authorized capital of the Company consists of 50,000 Ordinary Shares, nominal
      value 1.00 NIS (“Ordinary
      Shares”),
      of
      which 1,025 Ordinary Shares are issued and outstanding and all of which are
      held
      and beneficially owned by the Vendors as set forth on Appendix A.

    

    All
      outstanding shares of capital stock of the Company are duly authorized, validly
      issued, fully paid and nonassessable and not subject to preemptive rights.
      As of
      the date of this Agreement, there are no bonds, debentures, notes or other
      indebtedness of the Company. There are not any securities, options, warrants,
      calls, rights, commitments, agreements, arrangements or undertakings of any
      kind
      to which the Company is a party or by which it is bound obligating the Company
      to issue, deliver or sell, or cause to be issued, delivered or sold, additional
      shares of capital stock or other voting securities of the Company or obligating
      the Company to issue, grant, extend or enter into any such security, option,
      warrant, call, right, commitment, agreement, arrangement or undertaking. There
      are not any outstanding contractual obligations of the Company to repurchase,
      redeem or otherwise acquire any shares of capital stock of the
      Company.

     

    3.4        
      Authority.

     

    (a)       
      The
      Company has the requisite corporate power and authority to execute and deliver
      this Agreement and to consummate the transactions contemplated hereby. The
      execution, delivery and performance of this Agreement and other transactions
      contemplated hereby have been duly authorized by all necessary corporate action
      on the part of the Company and no other corporate proceedings on the part of
      the
      Company are necessary to authorize this Agreement or to consummate the
      transactions so contemplated. This Agreement has been duly executed and
      delivered by the Company and, assuming this Agreement constitutes a valid and
      binding obligation of the Company enforceable against the Company in accordance
      with its terms, except as limited by applicable bankruptcy, insolvency,
      reorganization, moratorium and other laws of general application affecting
      enforcement of creditors’ rights generally.

     

    The
      Board
      of Directors of the Company duly and unanimously adopted resolutions approving
      this Agreement

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    3.5        
      Consents
      and Approvals; No Violations.
      Except
      for filings, permits, authorizations, consents and approvals as may be required
      under, and other applicable requirements of Israel Company Registrar, and the
      filings contemplated in connection with the Purchase, neither the execution,
      delivery or performance of this Agreement by the Company nor the consummation
      by
      the Company of the transactions contemplated hereby will (i) conflict with
      or
      result in any breach of any provision of the Articles of Incorporation or
      Certificate of Incorporation of the Company, (ii) require any filing with,
      or
      permit, authorization, consent or approval of, any state or local government
      or
      any court, tribunal, administrative agency or commission or other governmental
      or other regulatory authority or agency, domestic, foreign or supranational
      (a
“Governmental Entity”) (except where the failure to obtain such permits,
      authorizations, consents or approvals or to make such filings could not
      reasonably be expected to have a material adverse effect on the Company or
      prevent or materially delay the consummation of the Merger), (iii) result in
      a
      violation or breach of, or constitute (with or without due notice or lapse
      of
      time or both) a default (or give rise to any right of termination, amendment,
      cancellation or acceleration) under, any of the terms, conditions or provisions
      of any note, bond, mortgage, indenture, lease, license, contract, agreement
      or
      other instrument or obligation to which the Company is a party or by which
      the
      Company or its properties or assets may be bound; or (iv) violate any order,
      writ, injunction, decree, statute, rule or regulation applicable to the Company
      or any of its properties or assets, except in the case of clauses (iii) or
      (iv)
      for violations, breaches or defaults that could not reasonably be expected
      to
      have a material adverse effect on the Company or prevent or materially delay
      the
      consummation of the Purchaser. 

     

    3.6        
      Financial
      Statements
      As of
      the Closing the audited financial statements of the Company set forth in
      Section 3.6 of the Disclosure Schedule as of and for the year ended
      31.12.2005, (the “Balance Sheet Date”) comply as to form in all material
      respects with applicable accounting requirements and with the published rules
      and regulations of the Securities and Exchange Commission (the “SEC”) and the
      Public Company Accounting Oversight Board (the “PCAOB”) with respect thereto,
      have been prepared in accordance with generally accepted accounting principles
      (“GAAP”) applied on a consistent basis during the periods involved (except as
      may be indicated in the notes thereto) and fairly present the financial position
      of the Company as at the dates thereof and the results of the Company’s
      operations and cash flows for the periods then ended. 

     

    3.7        
      Absence
      of Certain Changes or Events.
      As of
      the Balance Sheet Date, the Company has conducted its businesses only in the
      ordinary course consistent with past practice, there has not been any material
      adverse change with respect to the Company. Since the Balance Sheet Date, there
      has not been (i) any declaration, setting aside or payment of any dividend
      or
      other distribution with respect to the Company’s capital stock or any
      redemption, purchase or other acquisition of any of its capital stock, (ii)
      any
      split, combination or reclassification of any of the Company’s capital stock or
      any issuance or the authorization of any issuance of any other securities in
      respect of, in lieu of or in substitution for shares of its capital stock,
      (iii)
      any material change in accounting methods, principles or practices by the
      Company, (iv) (w) any granting by the Company to any employee of the Company
      of
      any increase in compensation except as provided for in written employment
      agreement, , (x) any granting by the Company to any employee of any increase
      in
      severance or termination pay, except as part of a standard employment package
      to
      any person promoted or hired, or as was required under employment, severance
      or
      termination agreements in effect as of the Balance Sheet Date, (y) except
      employment arrangements in the ordinary course of business consistent with
      past
      practice with employees, any entry by the Company into any employment, severance
      or termination agreement with any employee, or (z) any increase in or
      establishment of any bonus, insurance, deferred compensation, pension,
      retirement, profit-sharing, stock option (including the granting of stock
      options, stock appreciation rights, performance awards or restricted stock
      awards or the amendment of any existing stock options, stock appreciation
      rights, performance awards or restricted stock awards), stock purchase or other
      employee benefit plan or agreement or arrangement, (v) any damage,
      destruction or loss, whether or not covered by insurance, that has or reasonably
      could be expected to have a material adverse effect on the Company, (vi) any
      amendments or changes in the Certificate of Incorporation or Articles of
      Association of the Company, (vii) any material revaluation by the Company of
      any
      of its assets, including writing down the value of inventory or writing off
      notes or accounts receivable other than in the ordinary course of business,
      (viii) any increase in debt over $20,000 or (ix) any other action or event
      that
      would have required the consent of the Purchaser pursuant to Section 5.1 had
      such action or event occurred after the date of this Agreement.

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    3.8        
      No
      Undisclosed Liabilities.
      To the
      knowledge of the Company, the Company did not have any liabilities or
      obligations of any nature, whether or not accrued, contingent or otherwise,
      that
      would be required by GAAP to be reflected on a balance sheet of the Company
      (including the notes thereto). Since the Balance Sheet Date and except for
      liabilities or obligations incurred in the ordinary course of business
      consistent with past practice, the Company has not incurred any liabilities
      of
      any nature, whether or not accrued, contingent or otherwise, that could be
      reasonably expected to have a material adverse effect on the Company, or would
      be required by GAAP to be reflected on a consolidated balance sheet of the
      Company (including the notes thereto).

     

    3.9        
      Benefit
      Plans; Chief Scientist.
      The
      Company has not adopted any employee benefit plans. The Company has not applied
      for or received any benefits from the Israeli Ministry of Industry and Trade.
      

     

    3.10       Other
      Compensation Arrangements.
      Except
      as disclosed as of the date of this Agreement, the Company is not a party to
      any
      oral or written (i) consulting agreement that is not terminable on not more
      than
      30 calendar days notice, or union or collective bargaining agreement, (ii)
      agreement with any executive officer or other key employee of the Company (iii)
      agreement with a third party in which a Company officer or other employee is
      a
      shareholder, partner, consultant or employee or (iii) any stock option plan,
      stock appreciation right plan, restricted stock plan or stock purchase
      plan.

     

    3.11       Litigation.
      There
      is no suit, claim, action, proceeding or investigation pending before any
      Governmental Entity or, to the best knowledge of the Company, threatened against
      the Company that could reasonably be expected to have a material adverse effect
      on the Company or prevent or materially delay the consummation of the Purchase.
      The Company is not subject to any outstanding order, writ, injunction or decree
      that could reasonably be expected to have a material adverse effect on the
      Company or prevent or materially delay the consummation of the
      Purchase.

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

     

    3.12       Permits;
      Compliance with Law.
      To the
      best of its knowledge, the Company holds all permits, licenses, variances,
      exemptions, orders and approvals of all Governmental Entities necessary for
      the
      lawful conduct of its business (the “Company
      Permits”),
      except for failures to hold such permits, licenses, variances, exemptions,
      orders and approvals that could not reasonably be expected to have a material
      adverse effect on the Company. The Company is in compliance with the terms
      of
      the Company Permits, except where the failure so to comply could not reasonably
      be expected to have a material adverse effect on the Company. To the knowledge
      of the Company, the business of the Company is not being conducted in violation
      of any law, ordinance or regulation of any Governmental Entity, except for
      possible violations that could not reasonably be expected to have a material
      adverse effect on the Company or prevent or materially delay the consummation
      of
      the Purchase. As of the date of this Agreement, no investigation, inquiry or
      review by any Governmental Entity with respect to the Company is pending or,
      to
      the best knowledge of the Company, threatened, nor has any Governmental Entity
      indicated an intention to conduct any such investigation, inquiry or review,
      other than, in each case, those the outcome of which could not be reasonably
      expected to have a material adverse effect on the Company or prevent or
      materially delay the consummation of the Purchase.

     

    3.13       Tax
      Matters.

     

    (a)       
      The
      financial statements of the Company (the “Company Financial Statements”) reflect
      an adequate reserve for all taxes payable by the Company for all taxable periods
      and portions thereof through the Balance Sheet Date. The unpaid taxes do not
      exceed that reserve as adjusted for the passage of time through the Closing
      Date.

     

    (b)       
      To
      the
      best of its knowledge, the Company is not under audit or examination by any
      taxing authority, and no written or unwritten notice of such an audit or
      examination has been received by the Company. No claim has ever been made by
      an
      authority in a jurisdiction where Company does not file tax returns that it
      is
      or may be subject to taxation by that jurisdiction.

     

    (c)       
      There
      is
      no agreement or other document extending, or having the effect of extending,
      the
      period of assessment or collection of any taxes and no power of attorney with
      respect to any taxes has been executed or filed with any taxing
      authority.

     

    (d)       
      No
      liens
      for taxes exist with respect to any assets or properties of the Company, except
      for liens for taxes not yet due.

     

    (e)       
      The
      Company is not liable for taxes of any other person nor is the Company a party
      to or bound by any tax sharing agreement, tax indemnity obligation or similar
      agreement, arrangement or practice with respect to taxes (including any advance
      pricing agreement, closing agreement or other agreement relating to taxes with
      any taxing authority).

     

    (f)       
      The
      Company shall not be required to include in a taxable period ending after the
      Closing Date taxable income attributable to income that accrued in a prior
      taxable period but was not recognized in any prior taxable period.

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

     

    (g)       
      As
      used
      in this Agreement, “taxes” shall include all state, local and foreign income,
      property, sales, excise, withholding and other taxes, tariffs or governmental
      charges of any nature whatsoever, together with all interest, penalties and
      additions imposed with respect to such amounts.

     

    (h)       
      The
      Company is not a party to any joint venture, partnership, or other arrangement
      or contract which could be treated as a partnership for income tax
      purposes.

     

    (i)       
      All
      material elections with respect to taxes affecting the Company are disclosed
      or
      attached to the Company’s tax returns.

     

    (j)       
      There
      are
      no private letter rulings in respect of any tax pending between the Company
      and
      any taxing authority.

     

    3.14       Intellectual
      Property.

     

    (a)       
      Except
      to
      the extent that the inaccuracy of any of the following (or the circumstances
      giving rise to such inaccuracy) could not reasonably be expected to have a
      material adverse effect on the Company to the best knowledge of the Company
      and
      Gil Stiss:

     

    (1)       
      the
      Company owns an interest in, or is licensed or otherwise has the legally
      enforceable right to use (in each case, clear of any liens or encumbrances
      of
      any kind), all Intellectual Property (as hereinafter defined) used in or
      necessary for the conduct of its business as currently conducted;

     

    (2)       
      no
      claims
      are pending or, to the best knowledge of the Company, threatened that the
      Company is infringing on or otherwise violating the rights of any person with
      regard to any Intellectual Property used by, owned by and/or licensed to the
      Company and, to the best knowledge of the Company, there are no valid grounds
      for any such claims;

     

    (3)       
      To
      the
      best of its knowledge, no person is infringing on or otherwise violating any
      right of the Company with respect to any Intellectual Property owned by and/or
      licensed to the Company.

     

    (4)       
      To
      the
      best of its knowledge, there are no valid grounds for any claim challenging
      the
      ownership or validity of any Intellectual Property owned by the Company or
      challenging the Company’s license or legally enforceable right to use any
      Intellectual Property licensed by it; and  

     

    (5)       
      all
      patents, registered trademarks, service marks and copyrights held by the Company
      are valid and subsisting. 

     

    (b)       
      For
      purposes of this Agreement, “Intellectual Property” means trademarks (registered
      or unregistered), service marks, brand names, certification marks, trade dress,
      assumed names, trade names and other indications of origin, the goodwill
      associated with the foregoing and registrations in any jurisdiction of, and
      applications in any jurisdiction to register, the foregoing, including any
      extension, modification or renewal of any such registration or application;
      inventions, discoveries and ideas, whether patented, patentable or not in any
      jurisdiction; trade secrets and confidential information and rights in any
      jurisdiction to limit the use or disclosure thereof by any person; writings
      and
      other works of authorship, whether copyrighted, copyrightable or not in any
      jurisdiction; registration or applications for registration of copyrights in
      any
      jurisdiction, and any renewals or extensions thereof; any similar intellectual
      property or proprietary rights and computer programs and software (including
      source code, object code and data); licenses, immunities, covenants not to
      sue
      and the like relating to the foregoing; and any claims or causes of action
      arising out of or related to any infringement or misappropriation of any of
      the
      foregoing.

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

     

    (c)       
      Section
      3.14(c) of the Disclosure Schedule identifies each patent or registration which
      has been issued to the Company with respect to any of its Intellectual Property,
      identifies each pending patent application or application for registration
      which
      the Company has made with respect to any of its Intellectual Property, and
      identifies each material license, agreement, or other permission which the
      Company has granted to any third party with respect to any of its Intellectual
      Property (together with any exceptions). The Company has delivered to the
      Purchaser or its counsel correct and complete copies of all such patents,
      registrations, applications, licenses, agreements, and permissions (as amended
      to date). Section 3.14(c) of the Disclosure Schedule also identifies each
      registered trademark used by the Company in connection with any of its
      businesses. With respect to each item of Intellectual Property required to
      be
      identified in Section 3.14(c) of the Disclosure Schedule:

     

    (i)  to
      the
      knowledge of Gil Stiss and the Company, the Company possesses all right, title,
      and interest in and to the item, free and clear of any security interest,
      license, or other restriction;

     

    (ii)  to
      the
      knowledge of Gil Stiss and the Company the item is not subject to any
      outstanding injunction, judgment, order, decree, ruling, or charge;

     

    (iii)  the
      Company has not received notice of any action, suit, proceeding, hearing,
      investigation, charge, complaint, claim, or demand is pending or, to the
      knowledge of the Company, is threatened which challenges the legality, validity,
      enforceability, use, or ownership of the item; and

     

    (iv)  The
      Company has not agreed to indemnify any person for or against any interference,
      infringement, misappropriation, or other conflict with respect to the item,
      other than customary intellectual indemnities contained in its customer
      agreements.

     

    (d)       
      Section
      3.14(d) of the Disclosure Schedule identifies each material item of Intellectual
      Property that any third party owns and that the Company uses pursuant to
      license, sublicense, agreement, or permission, other than “off the shelf”
software licensed to the Company pursuant to shrinkwrap or clickwrap agreements.
      The Company has delivered to the Purchase or its counsel correct and complete
      copies of all such licenses, sublicenses, agreements, and permissions (as
      amended to date). With respect to each item of Intellectual Property required
      to
      be identified in Section 3.14(d) of the Disclosure Schedule:

     

    (i)  the
      license, sublicense, agreement, or permission covering the item is legal, valid,
      binding, enforceable, and in full force and effect in all material
      respects;

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

     

    (ii)  no
      party
      to the license, sublicense, agreement, or permission is in material breach
      or
      default, and no event has occurred which with notice or lapse of time would
      constitute a material breach or default or permit termination, modification,
      or
      acceleration thereunder;

     

    (iii)  no
      party
      to the license, sublicense, agreement, or permission has repudiated any material
      provision thereof; and

     

    (iv)  the
      Company not has granted any sublicense or similar right with respect to the
      license, sublicense, agreement, or permission in violation of such license,
      sublicense, agreement or permission.

     

    3.15       Labor
      Matters.
      (i)
      there are no controversies pending or, to the knowledge of the Company,
      threatened, between the Company and any of its employees, which controversies
      have had, or could reasonably be expected to have, a material adverse effect;
      (ii) the Company is not a party to any collective bargaining agreement or other
      labor union contract applicable to persons employed by the Company, nor does
      the
      Company know of any activities or proceedings of any labor union to organize
      any
      such employees; and (iii) the Company does not have any knowledge of any
      strikes, slowdowns, work stoppages, lockouts, or threats thereof, by or with
      respect to any employees of the Company which could reasonably be expected
      to
      have a material adverse effect.

     

    3.16       Title
      to Property.
      The
      Company has good and defensible title to all of its properties and assets,
      free
      and clear of all liens, charges and encumbrances, except liens for taxes not
      yet
      due and payable and such liens or other imperfections of title, if any, as
      do
      not materially detract from the value of or interfere with the present use
      of
      the property affected thereby or which could not reasonably be expected to
      have
      a material adverse effect; and, to the knowledge of the Company, all leases
      pursuant to which the Company leases from others material amounts of real or
      personal property are in good standing, valid and effective in accordance with
      their respective terms, and there is not, to the knowledge of the Company,
      under
      any of such leases, any existing default or event of default (or event which
      with notice or lapse of time, or both, would constitute a default), except
      where
      the lack of such good standing, validity and effectiveness or the existence
      of
      such default or event of default could not reasonably be expected to have a
      material adverse effect.

     

    3.17       Accounts
      Receivable.
      The
      accounts receivable of the Company as reflected in the Balance Sheet Date
      financial statements, to the extent uncollected on the date hereof, and the
      accounts receivable reflected on the books of the Company, are valid and
      existing and represent monies due, and the Company has made reserves reasonably
      considered adequate for receivables not collectible in the ordinary course
      of
      business, and (subject to the aforesaid reserves) are subject to no refunds
      or
      other adjustments and to no defenses, rights of setoff, assignments,
      restrictions, encumbrances or conditions enforceable by third parties on or
      affecting any thereof, except for such refunds, adjustments, defenses, rights
      of
      setoff, assignments, restrictions, encumbrances or conditions as would not
      reasonably be expected to have a material adverse effect.

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

     

    3.18       Absence
      of Certain Payments.
      None of
      the Company, or any of its respective affiliates, officers, directors, employees
      or agent or other people acting on behalf of any of them have (used any
      corporate or other funds for unlawful contributions, payments, gifts or
      entertainment, or made any unlawful expenditures relating to political activity
      to government officials or others. None of the Company, or any of its
      affiliates, directors, officers, employees or agents of other persons acting
      on
      behalf of any of them, has accepted or received any unlawful contributions,
      payments, gifts or expenditures.

     

    3.19       Insurance.
      The
      Company maintains insurance set forth in section 3.19 of the Disclosure
      Schedule.

     

    3.20       Full
      Disclosure.
      To the
      best of its knowledge, no statement contained in any certificate or schedule
      furnished or to be furnished by the Company to the Purchaser in, or pursuant
      to
      the provisions of, this Agreement, contains or will contain any untrue statement
      of a material fact or omits to state any material fact necessary, in light
      of
      the circumstances under which it was made, in order to make the statements
      herein or therein not misleading. To Gil Stiss’s and the Company’s knowledge,
      there is no fact known to the Company that has not been disclosed in writing
      to
      the Purchaser that would reasonably be expected to have or result in a material
      adverse effect. 

     

    3.21       Contracts.
      Section
      3.21 of the Disclosure Schedule lists the following contracts and other
      agreements to which the Company is a party, which are in effect at the date
      of
      this Agreement:

     

    (a)       
      any
      agreement (or group of related agreements) for the lease of personal property
      to
      or from any person providing for lease payments in excess of $25,000 per
      annum;

     

    (b)       
      any
      agreement (or group of related agreements) for the purchase or sale of raw
      materials, commodities, supplies, products, or other personal property, or
      for
      the furnishing or receipt of services, the performance of which will extend
      over
      a period of more than one year or involve consideration in excess of
      $10,000;

     

    (c)       
      any
      agreement concerning a partnership or joint venture; 

     

    (d)       
      any
      agreement (or group of related agreements) under which it has created, incurred,
      assumed, or guaranteed any indebtedness for borrowed money, or any capitalized
      lease obligation, in excess of $10,000 or under which it has imposed a Security
      Interest on any of its assets, tangible or intangible;

     

    (e)       
      any
      material agreement concerning confidentiality or noncompetition;

     

    (f)       
      any
      material agreement between the Company and its affiliates;

     

    (g)       
      any
      profit sharing, stock option, stock purchase, stock appreciation, deferred
      compensation, severance, or other material plan or arrangement for the benefit
      of its current or former directors, officers, and employees;

     

    (h)       
      any
      collective bargaining agreement;

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

     

    (i)       
      any
      agreement for the employment of any individual on a full-time
      basis;

     

    (j)       
      any
      agreement under which it has advanced or loaned any amount to any of its
      directors, officers, and employees outside the ordinary course of
      business;

     

    (k)       
      any
      agreement under which the consequences of a default or termination would have
      a
      material adverse effect on the business, financial condition, operations or
      results of operations of the Company or a Company Subsidiary; or

     

    (l)       
      any
      other
      agreement (or group of related agreements) the performance of which involves
      consideration in excess of $10,000.

     

    The
      Company has delivered to the Purchaser or its counsel a complete copy of each
      written agreement listed in Section 3.21 of the Disclosure Schedule (as amended
      to date). With respect to each such agreement: (i) the agreement is valid and
      binding on the Company and in full force and effect in all material respects;
      (ii) to Gil Stiss’s and the Company’s knowledge, no party is in material breach
      or default, and, no event has occurred which with notice or lapse of time would
      constitute a material breach or default, or permit termination, modification,
      or
      acceleration, under the agreement; and (iii) no party has provided the Company
      with notice of repudiation of any material provision of the
      agreement.

    

    3.22       Real
      Property.
      The
      Company does not own any real property. Section 3.22 of the Disclosure Schedule
      lists and describes briefly all real property leased or subleased to the
      Company. Company has delivered to the Purchaser or its counsel correct and
      complete copies of the leases and subleases listed in Section 3.22 of the
      Disclosure Schedule (as amended to date). With respect to each lease and
      sublease listed in Section 3.22 of the Disclosure Schedule, except as otherwise
      stated therein:

    

    (a)       
      the
      lease
      or sublease is legal, valid, binding, enforceable, and in full force and effect
      in all material respects;

     

    (b)       
      no
      party
      to the lease or sublease is in material breach or material default, and, to
      the
      Company’s knowledge, no event has occurred which, with notice or lapse of time,
      would constitute a material breach or material default or permit termination,
      modification, or acceleration thereunder;

     

    (c)       
      to
      the
      Company’s knowledge, no party to the lease or sublease has repudiated any
      material provision thereof;

     

    (d)       
      there
      are
      no material disputes, oral agreements, or forbearance programs in effect as
      to
      the lease or sublease;

     

    (e)       
      The
      Company has not assigned, transferred, conveyed, mortgaged, deeded in trust,
      or
      encumbered any interest in the leasehold or subleasehold; and

     

    (f)       
      To
      the
      best of its knowledge, all facilities leased or subleased thereunder have
      received all approvals of governmental authorities (including material licenses
      and permits) required in connection with the operation thereof, except where
      the
      lack of such approvals, licenses or permits would not have a material adverse
      effect on the Company, and have been operated and maintained in accordance
      with
      applicable laws, rules, and regulations in all material respects.

     

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

     

    3.23       No
      Other Representations.
      The
      Company and Vendors shall not be deemed to have made a representation or
      warranty to the Purchaser other than those expressly set forth in Sections
      2 and
      3 above.

     

    ARTICLE
      IV

     

    Representations
      and Warranties of the Purchaser

     

    The
      Purchaser represents and warrants to the Company as of the date hereof and
      as of
      the Closing that, except as
      otherwise provided in the Disclosure Schedule or in Purchaser’s Form 10K for
      2005 or Form 10Q for end of March 2006 (the “SEC
      Documents”)
      :

     

    4.1        
      Organization.
      The
      Purchaser is a corporation duly organized, validly existing and in good standing
      under the laws of the jurisdiction of its incorporation and has all requisite
      corporate power and authority to carry on its business as now being conducted,
      except where the failure to be so organized, existing and in good standing
      or to
      have such power and authority could not be reasonably expected to (i) prevent
      or
      materially delay the consummation of the Purchase or (ii) have a material
      adverse effect on the Purchaser. The Purchaser is duly qualified or licensed
      to
      do business and in good standing in each jurisdiction in which the property
      owned, leased or operated by it or the nature of the business conducted by
      it
      makes such qualification or licensing necessary, except in such jurisdictions
      where the failure to be so duly qualified or licensed and in good standing
      could
      not reasonably be expected to have a material adverse effect on the Purchaser
      or
      prevent or materially delay the consummation of the Purchase. The Purchaser
      has
      made available to the Vendors and Company complete and correct copies of its
      certificate of incorporation and bylaws.

     

    4.2        
      Authority.
      The
Purchaser
      has
      requisite corporate power and authority to execute and deliver this Agreement
      and to consummate the transactions contemplated hereby. The execution, delivery
      and performance of this Agreement and the consummation of the transactions
      contemplated hereby will have been duly authorized by all necessary corporate
      action on the part of the Purchaser
      and
      no
      other corporate proceedings on the part of the Purchaser
      are
      necessary to authorize this Agreement or to consummate such transactions. This
      Agreement has been duly executed and delivered by the Purchaser,
      and,
      assuming this Agreement constitutes a valid and binding obligation of the
      Company, constitutes a valid and binding obligation of the Purchaser
      enforceable
      against it in accordance with its terms, except as limited by applicable
      bankruptcy, insolvency, reorganization, moratorium and other laws of general
      application affecting enforcement of creditors’ rights generally. The Board of
      Directors of the Purchaser,
      unanimously adopted resolutions approving this Agreement and the
      Purchase.

    

    4.3        
      Consents
      and Approvals; No Violations.
      Except
      for filings, permits, authorizations, consents and approvals as may be required
      under, and other applicable requirements of, the Securities Exchange Act of
      1934
      (the “Exchange
      Act”),
      or
      the Nevada revised Statutes Chapter 78, neither the execution, delivery or
      performance of this Agreement by the Purchaser
      nor
      the
      consummation by the Purchaser
      of
      the
      transactions contemplated hereby will (i) conflict with or result in any breach
      of any provision of the certificate or articles of incorporation or bylaws
      of
      the Purchaser,
      (ii)
      require any filing with, or permit, authorization, consent or approval of,
      any
      Governmental Entity (except where the failure to obtain such permits,
      authorizations, consents or approvals or to make such filings could not be
      reasonably expected to prevent or materially delay the consummation of the
      Purchase), (iii) result in a violation or breach of, or constitute (with or
      without due notice or lapse of time or both) a default (or give rise to any
      right of termination, amendment, cancellation or acceleration) under, any of
      the
      terms, conditions or provisions of any note, bond, mortgage, indenture, license,
      lease, contract, agreement or other instrument or obligation to which the
Purchaser
      is
      a
      party or by which it or any of its properties or assets may be bound or (iv)
      violate any order, writ, injunction, decree, statute, rule or regulation
      applicable to the Purchaser
      or
      any of
      its properties or assets, except in the case of clauses (iii) and (iv) for
      violations, breaches or defaults that could not be reasonably be expected to
      have a material adverse effect on the Purchaser
      or
      prevent or materially delay the consummation of the Purchase.

     

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

     

    4.4        
      Sophisticated
      Purchaser.
      The
      Purchaser
      (including its members) has such knowledge, experience and sophistication in
      business and financial matters as to be capable of evaluating the merits and
      risks
      of
      the Purchase, is able to bear the economic risk of such purchase and is able
      to
      afford a complete loss of such purchase.
      Without
      derogating or limiting the rights and remedies of the Purchaser with respect
      to
      misrepresentation or omissions on the part of the Company, the Purchaser
      represents that it has been furnished by the Company and the Vendors with all
      documents and information regarding the Company which the Purchaser has
      requested; The Purchaser has been afforded the opportunity to ask questions
      and
      receive answers from duly authorized officers or other representatives of the
      Company, concerning the Company’s business, assets, legal, intellectual property
      and financial position, as well as any additional information which they have
      requested and based on the above the Purchaser has decided to enter into this
      Agreement. 

     

    4.5        
      Full
      Disclosure.
      No
      statement contained in any certificate or schedule furnished or to be furnished
      by the Neither the
      Purchaser nor any of its to
      the
      Vendors or Company in, or pursuant to the provisions of, this Agreement contains
      or shall contain any untrue statement of a material fact or omits or will omit
      to state any material fact necessary, in the light of the circumstances under
      which it was made, in order to make the statements herein or therein not
      misleading. To the Purchaser’s knowledge, there is no fact known to the
      Purchaser that has not been disclosed in writing to the Company or Vendors
      that
      would reasonably be expected to have or result in a material adverse
      effect.

     

    4.7        
      No
      Other Representations.
      The
      Purchaser shall not be deemed to have made a representation or warranty to
      the
      Vendors or Company other than those expressly set forth in Article IV
      above.

     

    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

    

     

    ARTICLE
      III

     

    Covenants

     

    5.1        
      Covenants.
      Each of
      the Vendors, Company and the Purchaser agrees as to itself that (except as
      expressly contemplated or permitted by this Agreement, as set forth in the
      Disclosure Schedule or to the extent that the other party shall otherwise
      consent in writing in advance), from and after the execution of this Agreement
      through the earlier of Closing or termination of this Agreement:

     

    (a)       
      Ordinary
      Course.
      Each of
      the Company and the Purchaser shall, and the Company shall cause the Company
      Subsidiaries to, carry on their respective businesses in the usual, regular
      and
      ordinary course and each of the Company and the Purchaser shall, and the Company
      shall cause the Company Subsidiaries to, use all reasonable efforts
      to preserve intact their present business organizations, keep available the
      services of their present officers and employees and preserve their
      relationships with customers, suppliers and others having business dealings
      with
      the Company or the Purchaser, respectively.

     

    (b)       
      Dividends;
      Changes in Stock.
      Neither
      the Company nor the Purchaser shall, and the Company shall not permit the
      Company Subsidiaries to, (i) declare or pay any dividends on or make other
      distributions in respect of any of its capital stock, except for, (ii) split,
      combine or reclassify any of its capital stock or issue or authorize or propose
      the issuance of any other securities in respect of, in lieu of or in
      substitution for shares of its capital stock, or (iii) repurchase, redeem
      or otherwise acquire any shares of its capital stock or the capital stock of
      its
      subsidiaries or any other securities thereof.

     

    (c)       
      Issuance
      of Securities.
      The
      Company shall not, and the Company shall not permit the Company Subsidiaries
      to,
      issue, deliver, sell, pledge or encumber, or authorize or propose the issuance,
      delivery, sale, pledge or encumbrance of, any shares of its capital stock of
      any
      class or any securities convertible into, or any rights, warrants, calls,
      subscriptions or options to acquire, any such shares or convertible securities,
      or any other ownership interest (including stock appreciation rights or phantom
      stock) other than the issuance of shares of the Company Ordinary Shares upon
      the
      exercise of the Company options or Company warrants outstanding on the date
      of
      this Agreement and in accordance with the terms of such the Company options
      or
      Company warrants.

     

    (d)       
      Governing
      Documents.
      Neither
      the Company nor the Purchaser shall, and the Company shall not permit any of
      the
      Company Subsidiaries to, amend or propose to amend its certificate or articles
      of incorporation or bylaws (or similar organizational documents).

     

    (e)       
      No
      Acquisitions.
      Neither
      the Company nor the Purchaser shall, and the Company shall not permit any of
      the
      Company Subsidiaries to, acquire or agree to acquire by merging or consolidating
      with, or by purchasing any equity interest in or any substantial assets of
      (other than inventory and equipment in the ordinary course consistent with
      past
      practice, to the extent not otherwise prohibited by this Agreement), or by
      any
      other manner, any business or any corporation, partnership, joint venture,
      association or other business organization or division thereof. 

     

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

    

     

    (f)       
      No
      Dispositions.
      Other
      than dispositions in the ordinary course of business consistent with past
      practice, neither the Company nor the Purchaser shall, and the Company shall
      not
      permit any of the Company Subsidiaries to, sell, lease, license, encumber or
      otherwise dispose of, or agree to sell, lease, license, encumber or otherwise
      dispose of, any of its assets. 

     

    (g)       
      Indebtedness.
      The
      Company shall not, and the Company shall not permit any of the Company
      Subsidiaries to, (i) incur any indebtedness for borrowed money or guarantee
      any
      such indebtedness or issue or sell any debt securities or warrants or rights
      to
      acquire any debt securities of the Company, or any of the Company Subsidiaries,
      guarantee any debt securities of others, enter into any “keep-well” or other
      agreement to maintain any financial statement condition of another person or
      enter into any arrangement having the economic effect of any of the foregoing,
      or (ii) make any loans, advances or capital contributions to, or investments
      in,
      any other person.

     

    (h)       
      Advice
      of Changes; Filings.
      Each of
      the Company and the Purchaser shall confer with the other party on a regular
      and
      frequent basis as reasonably requested by the other party, report on operational
      matters and promptly advise the other party orally and, if requested by the
      other party, in writing of any change or event having, or which, insofar as
      can
      reasonably be foreseen, is likely to have, a material adverse effect on the
      Company or the Purchaser, as applicable. Each of the Company and the Purchaser
      shall promptly provide to the other party (or its counsel) copies of all filings
      made by such party with any Governmental Entity in connection with this
      Agreement and the transactions contemplated hereby.

     

    (i)       
      Accounting
      Changes.
      Neither
      the Company nor the Purchaser shall make any material change, other than in
      the
      ordinary course of business, consistent with past practice, or as required
      by
      the SEC, PCAOB or law, with respect to any accounting methods, principles or
      practices used by such party (except insofar as may be required by a change
      in
      GAAP, of which the other party shall be promptly notified). 

     

    (j)       
      Discharge
      of Liabilities.
      Except
      for fees and expenses related to the transactions contemplated herein, neither
      the Company nor the Purchaser shall, and the Company shall not permit any of
      the
      Company Subsidiaries to, without the prior written consent of the other party,
      pay, discharge, settle or satisfy any claims, liabilities or obligations
      (absolute, accrued, asserted or unasserted, contingent or otherwise), other
      than
      the payment, discharge, settlement or satisfaction, in the ordinary course
      of
      business consistent with past practice or in accordance with their terms, of
      (i) liabilities recognized or disclosed in the Company Financial
      Statements, (ii) liabilities incurred since the date of such financial
      statements in the ordinary course of business consistent with past practice,
      or
      (iii) the liabilities of the Company set forth in Section 5.01(j) of the
      Disclosure Schedule. Neither the Company nor the Purchaser shall, and the
      Company shall not permit any of the Company Subsidiaries to, waive the benefits
      of, or agree to modify in any manner, any confidentiality, standstill or similar
      agreement to which such party or any of its subsidiaries is a
      party.

     

    (k)       
      Compensation
      of Employees.
      Neither
      the Company nor the Purchaser or any of the Company Subsidiaries will, without
      the prior written consent of the other party, except as may be required by
      law
      or otherwise provided in this Agreement, (i) enter into, adopt, amend or
      terminate any Company Benefit Plan, or other employee benefit plan or any
      agreement, arrangement, plan or policy for the benefit of any director,
      executive officer or current or former key employee, (ii) increase in any manner
      the compensation or fringe benefits of, or pay any bonus to, any director,
      executive officer or key employee, except as required by any Company Benefit
      Plan or agreement with such employees existing on the date of this Agreement,
      (iii) enter into, adopt, amend or terminate any Company Benefit Plan or other
      benefit plan or agreement, arrangement, plan or policy for the benefit of any
      employees other than increases in compensation as required by written agreement,
      or (iv) pay any benefit not required by any plan or arrangement as in effect
      as
      of the date hereof (including the granting of, acceleration of exercisability
      of
      or vesting of stock options, stock appreciation rights or restricted
      stock).

     

    
      
        
        

      

      
        16

        
          

        

      

      
        
        

      

    

     

    (l)       
      Material
      Contracts.
      Neither
      the Company nor the Purchaser or any of the Company Subsidiaries shall
      (i) modify, amend or terminate any material contract or agreement to which
      the such party is a party, or (ii) waive, release or assign any material rights
      or claims.

     

    (m)       
      No
      Dissolution, Etc.
      Neither
      the Company nor the Purchaser shall authorize, recommend, propose or announce
      an
      intention to adopt a plan of complete or partial liquidation of the Company
      or
      the Purchaser or any of its subsidiaries, respectively.

     

    (n)       
      Tax
      Election.
      Neither
      the Company nor the Purchaser or any of the Company Subsidiaries shall not
      make
      any tax election or settle or compromise any material income tax
      liability.

     

    (o)       
      Other
      Actions.
      Neither
      the Vendors, Company nor the Purchaser shall nor will the Company permit any
      of
      the Company Subsidiaries to take or agree or commit to take any action that
      is
      reasonably likely to result in any of the Vendors’, Company’s or the
      Purchaser’s, as applicable, representations or warranties hereunder being untrue
      in any material respect at, or as of any time prior to, the Closing, without
      the
      prior written consent of the other party.

     

    (p)         Financing.
      From
      the date of this Agreement until its termination the Purchaser shall use its
      best commercial efforts to obtain financing on terms acceptable to the Company
      of not less than $40,000 per month to finance the monthly business operations
      of
      the Company to be paid no later than the last day of each month. 

     

    (q)       
      General.
      Neither
      the Vendors, Company nor the Purchaser shall, and the Company shall not permit
      the Company Subsidiaries to, authorize any of, or commit or agree to take any
      of, the foregoing actions described in this Section 5.1.

     

    5.2        
      No
      Solicitation.

     

    (a)       
      The
      Vendors, Company and its officers, directors, employees, representatives and
      agents and the Purchaser and its officers, directors, employees, representatives
      and agents all shall immediately cease any discussions or negotiations with
      any
      parties that may be ongoing with respect to an Acquisition Proposal (as
      hereinafter defined). From and after the date hereof until the termination
      of
      this Agreement, neither the Company nor the Purchaser shall, nor the Company
      shall not permit any of the Company Subsidiaries to, authorize or permit any
      of
      their respective officers, directors or employees or any investment banker,
      financial advisor, attorney, accountant or other representative retained by
      it
      or any of its subsidiaries to, directly or indirectly, (i) solicit, initiate
      or
      knowingly encourage (including by way of furnishing non-public information
      or
      assistance), or knowingly take any other action to facilitate, any inquiries
      or
      the making of any proposal which constitutes, or may reasonably be expected
      to
      lead to, any Acquisition Proposal, or (ii) participate in any discussions or
      negotiations regarding any Acquisition Proposal. For purposes of this Agreement,
      “Acquisition Proposal” means any inquiry, proposal or offer from any person
      relating to any direct or indirect acquisition or purchase of 20% or more of
      the
      assets of the Company or the Purchaser, the Company Subsidiaries, as applicable
      or 20% or more of any class of equity securities of the Company, or any of
      the
      Company Subsidiaries, as applicable, any tender offer or exchange offer that
      if
      consummated would result in any person beneficially owning 20% or more of any
      class of equity securities of the Company or the Company Subsidiaries, any
      merger, consolidation, business combination, sale of all or substantially all
      the assets, recapitalization, liquidation, dissolution or similar transaction
      involving the Company or the Purchaser, or any of the Company Subsidiaries,
      as
      applicable, (other than the transactions between the parties hereto contemplated
      by this Agreement), or any other transaction the consummation of which could
      reasonably be expected to impede, interfere with, prevent or materially delay
      the Purchase or which could reasonably be expected to dilute materially the
      benefits to the other party hereto of the transactions contemplated hereby.
      

     

    
      
        
        

      

      
        17

        
          

        

      

      
        
        

      

    

     

    (b)       
      The
      Company shall promptly advise the Purchaser orally and in writing of any request
      for information relating to a potential or actual Acquisition Proposal, the
      material terms and conditions of such request or Acquisition Proposal and the
      identity of the person making such request or Acquisition Proposal.

     

    5.3        
      Other
      Actions.
      The
      Vendors, Company or the Purchaser shall not, and the Company shall not permit
      any of the Company Subsidiaries to, take any action that could reasonably be
      expected to result
      in
      (i) any of its representations and warranties set forth in this Agreement that
      are qualified as to materiality becoming untrue, (ii) any of such
      representations and warranties that are not so qualified becoming untrue in
      any
      material respect, or (iii) any of the conditions to the Purchase set forth
      in
      Article V hereof not being satisfied in all material respects.

     

    ARTICLE
      IVI

     

    Additional
      Agreements

     

    6.1        
      Access
      to Information.
      Upon
      reasonable notice and subject to restrictions contained in confidentiality
      agreements to which such party is subject (from which it shall use reasonable
      efforts to be released), the Vendors, Company and the Purchaser shall, and
      the
      Company cause each of the Company Subsidiaries to, afford to the other party
      and
      to the officers, employees, accountants, counsel and other representatives
      of
      the other party (on a need to know basis) access, during normal business hours
      to all their respective properties, books, contracts, commitments and records
      and, during such period, the Vendors, Company and the Purchaser shall (and
      shall
      cause each of its subsidiaries to) furnish promptly to the other party (a)
      a
      copy of each report, schedule, registration statement and other document filed
      or received by it during such period pursuant to SEC requirements, and (b)
      all
      other information concerning its business, properties and personnel as the
      other
      party may reasonably request. 

     

    
      
        
        

      

      
        18

        
          

        

      

      
        
        

      

    

     

    6.2        
      Reasonable
      Efforts.
      Each of
      the Vendors, Company, the Purchaser agrees to use its reasonable efforts to
      take, or cause to be taken, all actions necessary to comply promptly with all
      legal requirements which may be imposed on itself with respect to the Purchase
      (which actions shall include furnishing all information required in connection
      with approvals of or filings with any other Governmental Entity) and shall
      promptly cooperate with and furnish information to each other in connection
      with
      any such requirements imposed upon any of them or any of their subsidiaries
      in
      connection with the Purchase. Each of the Vendors, Company, the Purchaser,
      and
      the Company shall cause the each of the Company Subsidiaries to, use its
      reasonable efforts to take all reasonable actions necessary to obtain (and
      will
      cooperate with each other in obtaining) any consent, authorization, order or
      approval of, or any exemption by, any Governmental Entity or other public or
      private third party required to be obtained or made by the Purchaser, the
      Company, any of the Company Subsidiaries in connection with the Purchase or
      the
      taking of any action contemplated by this Agreement, except that no party need
      waive any substantial rights or agree to any substantial limitation on its
      operations or to dispose of or hold separate any material assets.

     

    6.3        
      Confidentiality.
      Prior
      to the Closing, each of the Company and the Purchaser shall, and shall cause
      its
      affiliates (as defined in Section 9.3) and its and their employees, agents,
      accountants, legal counsel and other representatives and advisers to, hold
      in
      strict confidence all, and not divulge or disclose any information of any kind
      concerning the other party and its business; provided, however, that the
      foregoing obligation of confidence shall not apply to (i) information that
      is or
      becomes generally available to the public other than as a result of a disclosure
      by such party, any of its affiliates or any of their respective employees,
      agents, accountants, legal counsel or other representatives or advisers, (ii)
      information that is or becomes available to such party, any of its affiliates
      or
      any of their respective employees, agents, accountants, legal counsel or other
      representatives or advisers on a nonconfidential basis, and (iii) information
      that is required to be disclosed by such party, any of its affiliates or any
      of
      their respective employees, agents, accountants, legal counsel or other
      representatives or advisers as a result of any applicable law, rule or
      regulation of any Governmental Entity; and provided further that such party
      promptly shall notify the other party of any disclosure pursuant to clause
      (iii)
      of this Section 6.3. Promptly after any termination of this Agreement, each
      of
      the Company and the Purchaser, and their respective representatives shall return
      to the other party or destroy all copies of documentation with respect to the
      other party that were supplied by or on behalf of the other party pursuant
      to
      this Agreement, without retaining any copy thereof.

     

    
      
        
        

      

      
        19

        
          

        

      

      
        
        

      

    

     

    6.4        
      Fees
      and Expenses.
       Except
      as
      provided below in this Section 6.4, all fees and expenses incurred in connection
      with the Purchase, this Agreement and the transactions contemplated by this
      Agreement shall be paid by the party incurring such fees or expenses, provided
      that the Purchaser shall pay all such fees and expenses of the Company upon
      consummation of the Purchase.

     

    6.5        
      Gil
      Stiss’ Employment.
      At
      Closing the Purchaser shall cause the Company to enter into the Employment
      Agreement attached hereto as Appendix 6.5.

     

    6.6        
      Promissory
      Notes.
      The
      Purchaser shall provide the Company with funds to pay-off all the promissory
      notes detailed in Section 3.21(p ) ix - xii of the Disclosure Schedule,
      according to the terms of such notes, as may be amended.

     

    ARTICLE
      VI

     

    Conditions

     

    7.1        
      Conditions
      to Each Party’s Obligation To Effect the Purchase.
      The
      respective obligation of each party to effect the Purchase shall be subject
      to
      the satisfaction prior to the Closing Date of the following
      conditions:

     

    (a)       
      All
      consents, authorizations, orders and approvals of (or filings or registrations
      with) any Governmental Authority or other regulatory body required in connection
      with the execution, delivery and performance of this Agreement, the failure
      to
      obtain which would prevent the consummation of the Purchase or have a material
      adverse effect on the Purchased Shares, Company or the Purchaser, shall have
      been obtained; and

     

    (b)       
      No
      Governmental Entity or other regulatory body (including any court of competent
      jurisdiction) shall have enacted, issued, promulgated, enforced or entered
      any
      law, rule, regulation, executive order or decree, or any ruling, injunction
      or
      other order (whether temporary, preliminary or permanent) which is then in
      effect and has the effect of making illegal, materially restricting or in any
      way preventing or prohibiting the Purchase or the transactions contemplated
      by
      this Agreement; provided, however, that each of the parties shall have used
      reasonable efforts (subject to the other terms and conditions of this Agreement)
      to prevent the entry of any such injunction or other order.

     

    7.2        
      Conditions
      to Obligations of the Purchaser to Effect the Purchaser.
      The
      obligations of the Purchaser to effect the Purchase are further subject to
      satisfaction or waiver at or prior to the Closing Date of the following
      conditions.

     

    (a)       
      There
      shall not have occurred any change, condition, event or development that has
      resulted in, or could reasonably be expected to result in, a material adverse
      effect on the Purchased Shares or the Company;

     

    (b)       
      The
      representations and warranties of the Vendors or the Company in this Agreement
      that are qualified by materiality shall be true and correct in all respects
      as
      of the date of this Agreement and as of the Closing Date;

     

    
      
        
        

      

      
        20

        
          

        

      

      
        
        

      

    

     

    (c)       
      The
      representations and warranties of the Vendors or the Company in this Agreement
      that are not qualified by materiality shall be true and correct in all material
      respects as of the date of this Agreement and as of the Closing
      Date;

     

    (d)       
      The
      Vendors and Company shall have performed in all material respects all
      obligations required to be performed by them under this
      Agreement;

     

    (e)       
      The
      Vendors and an officer of the Company shall have delivered to the Purchaser
      a
      certificate to the effect that each of the conditions specified in Sections
      7.2
(a),
      (b),
      (c)
      and
(d)
      is
      satisfied in all respects;

     

    (f)       
      All
      authorizations, consents, waivers and approvals from parties to contracts or
      other agreements to which the Company is a party, or by which it is bound,
      as
      may be required to be obtained by it in connection with the performance of
      this
      Agreement, the failure to obtain which would prevent the consummation of the
      Purchase or have, individually or in the aggregate, a material adverse effect
      on
      Company or the Purchased Shares, shall have been obtained;

     

    (g)       
      The
      Purchaser shall have received an opinion, dated the Closing Date, of Balter,
      Guth, Aloni & Co., counsel to the Company, in form and substance reasonably
      satisfactory to the Purchaser with respect to Sections 3.3 and the Company’s
      signatory rights, relaying on declarations of Mr. Gil Stiss and Mr. Yoav Hirsh.
      (c) No
      suit,
      action or proceeding before any court or any governmental or regulatory
      authority shall have been commenced and be pending by any person against the
      Vendors, Company, the Purchaser, or any of their affiliates, associates,
      officers or directors (i) challenging the Purchase, seeking to restrain or
      prohibit the consummation of the transactions contemplated by this Agreement
      or
      seeking to obtain any substantial damages relating to the consummation of the
      transactions contemplated by this Agreement, (ii) seeking to prohibit or
      impose any material limitation on the ownership or operation by the Purchaser
      (or any of its affiliates or subsidiaries) of all or a material portion of
      the
      business or assets or properties of the Company or the Purchased Shares or
      to
      compel the Purchaser (or any of its affiliates or subsidiaries) to dispose
      of or
      hold separate all or any portion of the business or assets of the Company,
      (iii) seeking to impose any material limitation upon the ability of the
      Purchaser (or any of its affiliates) effectively to acquire or hold or to
      exercise full rights of ownership of the Company, or (iv) which otherwise
      is reasonably likely to have a material adverse effect on the Company or he
      Purchased Shares;

     

    (h)       
      The
      Company shall deliver to the Purchaser audited financial statements, pursuant
      to
      Section 3.6, for its fiscal year ended December 31, 2005;

     

    (i)       
      A transfer deed signed by Mr. Gil Stiss for the transfer of all of his right,
      title and interest in the patent, detailed in Disclosure Schedule 3.14(c) to
      the
      Company 

     

    7.3        
      Conditions
      to Obligations of the Company and the Vendors to Effect the
      Purchase.
      The
      obligations of the Company and the Vendors to effect the Purchase are further
      subject to satisfaction or waiver at or prior to the Closing Date of the
      following conditions:

     

    
      
        
        

      

      
        21

        
          

        

      

      
        
        

      

    

     

    (a)       
      There
      shall not have occurred any change, condition, event or development that has
      resulted in, or could reasonably be expected to result in, a material adverse
      effect on the Purchaser;

     

    (b)       
      The
      representations and warranties of the Purchaser in this Agreement that are
      qualified by materiality shall be true and correct in all respects as of the
      date of this Agreement and as of the Closing Date;

     

    (c)       
      The
      representations and warranties of the Purchaser in this Agreement that are
      not
      qualified by materiality shall be true and correct in all material respects
      as
      of the date of this Agreement and as of the Closing Date;

     

     (d)       
      The
      Purchaser shall have performed in all material respects all obligations required
      to be performed by it under this Agreement; 

     

    (e)       
      The
      Purchaser shall have delivered to the Vendors a certificate to the effect that
      each of the conditions specified in Sections 7.3 (l), (m), (n) and (o) is
      satisfied in all respects; 

     

    (f)       
      All
      authorizations, consents, waivers and approvals from parties to contracts or
      other agreements to which the Purchaser is a party, or by which it is bound,
      as
      may be required to be obtained by it in connection with the performance of
      this
      Agreement, the failure to obtain which would prevent the consummation of the
      Purchase or have, individually or in the aggregate, a material adverse effect
      on
      Company, shall have been obtained;

     

    (g)       
      No
      suit,
      action or proceeding before any court or any governmental or regulatory
      authority shall have been commenced and be pending by any person against the
      Vendors, Company, the Purchaser, or any of their affiliates, associates,
      officers or directors (i) challenging the Purchase, seeking to restrain or
      prohibit the consummation of the transactions contemplated by this Agreement
      or
      seeking to obtain any substantial damages relating to the consummation of the
      transactions contemplated by this Agreement, (ii) seeking to prohibit or
      impose any material limitation on the ownership or operation by the Purchaser
      (or any of its affiliates or subsidiaries) of all or a material portion of
      the
      business or assets or properties of the Company or the Purchased Shares or
      to
      compel the Purchaser (or any of its affiliates or subsidiaries) to dispose
      of or
      hold separate all or any portion of the business or assets of the Company,
      (iii) seeking to impose any material limitation upon the ability of the
      Purchaser (or any of its affiliates) effectively to acquire or hold or to
      exercise full rights of ownership of the Company, or (iv) which otherwise
      is reasonably likely to have a material adverse effect on the Company or he
      Purchased Shares;

     

    ARTICLE
      XIII

     

    Deliveries
      at Closing

    

    

    At
      the
      Closing date, the Parties shall, inter alia, meet, perform and deliver the
      following:

     

    
      
        
        

      

      
        22

        
          

        

      

      
        
        

      

    

     

    8.1        
      The
      Vendors and the Company shall deliver to the Purchaser: 

    

    (a)
      executed deeds of transfer, properly endorsed or otherwise in proper form for
      transfer for the Purchased Shares pursuant to Section 1.1(a). 

    

    (b)
      Assignment of loans pursuant to Section 1.1(a).

    

    (c
      ) A
      transfer deed signed by Mr. Gil Stiss for the transfer of all of its right
      in
      the patent, detailed in Disclosure Schedule 3.14(c) to the Company.

    

    (d)
      Audited financial statements of the Company for the year ended 2005 pursuant
      to
      Section 7.2(ka).

     

    (e)
      Certificates as to satisfaction of conditions pursuant to section
      7.2(g).

     

    (f)
      Opinion of counsel pursuant to Section 7.2(i).

    

    (g)
      Letter from Shikumit Ltd., in form satisfactory to Purchaser, waiving any and
      all claims or demands against Company. 

    

    

    8.2        
      (a)
      Purchaser shall deliver to the Vendors the Purchase Price pursuant to Section
      1.4.

    
             
      (b) The Purchaser shall deliver to the Vendors and the Company certificates
      as
      to satisfaction of conditions pursuant to Section 7.2(p).

    

    8.3        
      All actions to be taken and documents to be delivered at the Closing, shall
      be
      deemed to take place simultaneously and none of them shall be deemed to have
      occurred or to have been delivered until all shall have occurred and been
      delivered.

     

    ARTICLE
      IX

     

    Termination
      and Amendment

     

    9.1        
      Termination.
      This
      Agreement may be terminated at any time prior to the Closing Date:

     

    (a)       
      by
      written consent of the Parties;

     

    (b)       
      by
      any
      Party if any Governmental Entity shall have issued an order, injunction, decree
      or ruling or taken any other action (that has not been vacated, withdrawn or
      overturned) permanently enjoining, restraining or otherwise prohibiting the
      acceptance for payment of, or payment for, shares of the Company pursuant to
      the
      Purchase;

     

    (c)       
      by
      any
      Party, if the representations and warranties of another Party shall not
      have been true and correct in all material respects when made, except in any
      case where such failure to be true and correct would not, in the aggregate,
      (x) have a material adverse effect, or (y) prevent or materially delay
      the consummation of the Purchase, provided that such breach has continued
      without cure for a period of 20 days after receipt of the notice of
      breach;

     

    
      
        
        

      

      
        23

        
          

        

      

      
        
        

      

    

     

    (d)       
      by
      any
      Party if the Closing shall not have occurred on or before July 1, 2006, unless
      extended by agreement of the Parties hereto.

     

    9.2        
      Effect
      of Termination.
      In the
      event of a termination of this Agreement by any Party as provided in Section
      9.1, this Agreement shall forthwith become void and there shall be no liability
      or obligation on the part of the any Party or their respective officers,
      directors, stockholders or affiliates, except with respect to Section 6.3,
      this Section 9.2 and Article X; provided,however,
      that
      nothing herein shall relieve the Purchaser or the Company or the Vendors for
      liability for any breach hereof.

     

    9.3        
      Amendment
      This
      Agreement may not be amended except by an instrument in writing signed on behalf
      of each of the parties hereto.

     

    9.4        
      Waiver.
      The
      failure of any party to this Agreement to assert any of its rights under this
      Agreement or otherwise shall not constitute a waiver of those
      rights.

     

    ARTICLE
      X

     

    Miscellaneous

     

    10.1       Survival
      of Representations and Warranties
      The
      representations and warranties in this Agreement and in any instrument delivered
      pursuant to this Agreement shall survive the Closing Date for a period of 18
      months. This Section 10.1 shall not limit any covenant or agreement of the
      parties which by its terms contemplates performance after the Closing
      Date.

     

    10.2       Notices
      and Addresses.
      All
      notices, offers, acceptance and any other acts under this Agreement shall be
      in
      writing, and shall be sufficiently given if delivered to the addressees in
      person, by Federal Express or similar overnight next business day delivery,
      or
      by facsimile delivery followed by overnight next business day delivery, as
      follows:

     

    
      
        
        

      

      
        24

        
          

        

      

      
        
        

      

    

     

    
      	 	
              (a)
                if to Vendors

            	 	
              Mr.
                Gil Stiss

              41
                Nahal Lacish St., Asdod

              Israel

               

              Mr.
                Yoav Hirsh

              29
                Inbar St., P.O. Box 4056

              Cesarea
                38900

              Israel

               

              Mr.
                Shlomo Helbershtat

              65
                Harakun St., Hod-Hasharon

              Israel

            
	 	 	 	 
	 	
              (b) if
                to the Company, to:

            	 	
              IDO
                Security 2000 Ltd.

              6
                Sapir St., Reshon-Lezion

              Israel

            
	 	
              (c
                ) if to Purchaser, to:

            	 	
              To
                be provided at Closing. Unitil such date c/o Aboudi & Brounstein
                

            
	 	 	 	 
	 	
              With
                a copy to:

            	 	
              Aboudi
                & Brounstein

              Law
                offices

              Gavish
                3, Kfar Saba, Israel

              Fax:
                972-9-764-4834

            

    

    

    or
      to
      such other address as any of them, by notice to the other may designate from
      time to time. The transmission confirmation receipt from the sender’s facsimile
      machine shall be evidence of successful facsimile delivery. Time shall be
      counted from the date of transmission.

     

    10.2     
      Interpretation.
      When a
      reference is made in this Agreement to an Article or a Section, such reference
      shall be to an Article or a Section of this Agreement unless otherwise
      indicated. The table of contents and headings contained in this Agreement are
      for reference purposes only and shall not affect in any way the meaning or
      interpretation of this Agreement. Whenever the words “include,” “includes” or
“including” are used in this Agreement, they shall be deemed to be followed by
      the words “without limitation.” The phrase “made available” in this Agreement
      shall mean that the information referred to has been made available if requested
      by the party to whom such information is to be made available. As used in this
      Agreement, the term “subsidiary” of any person means another person, an amount
      of the voting securities, other voting ownership or voting partnership interests
      of which is sufficient to elect at least a majority of its Board of Directors
      or
      other governing body (or, if there are no such voting interests, 50% or more
      of
      the equity interests of which) is owned directly or indirectly by such first
      person, and the term “affiliate” shall have the meaning set forth in Rule 12b-2
      promulgated under the Exchange Act. As used in this Agreement, “material adverse
      change” or “material adverse effect” means, when used in connection with a
      person, any change or effect (or any development that, insofar as can reasonably
      be foreseen, is likely to result in any change or effect) that, individually
      or
      in the aggregate with any such other changes or effects, is materially adverse
      to the business, prospects, assets (including intangible assets), financial
      condition or results of operations of such person and its subsidiaries taken
      as
      a whole. 

     

    
      
        
        

      

      
        25

        
          

        

      

      
        
        

      

    

     

    10.3       
      Counterparts.
      This
      Agreement may be executed in one or more counterparts, all of which shall be
      considered one and the same agreement and shall become effective when said
      counterparts have been signed by each of the parties and delivered to the other
      parties, it being understood that all parties need not sign the same
      counterpart.

     

    10.4       Entire
      Agreement; Third Party Beneficiaries.
      This
      Agreement (including the documents and the instruments referred to herein)
      (a) constitute the entire agreement and supersede all prior agreements and
      understandings, both written and oral, among the parties with respect to the
      subject matter hereof, and (b)  are not intended to confer upon any person
      other than the parties hereto any rights or remedies hereunder.

     

    10.5       Governing
      Law.
      This
      Agreement shall be governed and construed in accordance with the laws of the
      State of Israel and, to the extent provided herein, the Nevada Revised Statutes
      Chapter 78, without regard to any applicable conflicts of law.

     

    10.6       Assignment.
      Neither
      this Agreement nor any of the rights, interests or obligations hereunder shall
      be assigned by either of the parties hereto (whether by operation of law or
      otherwise) without the prior written consent of the other parties. Subject
      to
      the preceding sentence, this Agreement will be binding upon, inure to the
      benefit of and be enforceable by the parties and their respective successors
      and
      assigns.

     

    10.7       No
      Remedy in Certain Circumstances.
      Each
      party agrees that, should any court or other competent authority hold any
      provision of this Agreement to be null, void or unenforceable, or order any
      party to take any action inconsistent herewith or not to take an action
      consistent herewith or required hereby, the validity, legality and
      enforceability of the remaining provisions and obligations contained or set
      forth in this Agreement shall not in any way be affected or impaired thereby,
      unless the foregoing inconsistent action or the failure to take an action
      constitutes a material breach of this Agreement or makes this Agreement
      impossible to perform, in which case this Agreement shall terminate pursuant
      to
      Article VIII hereof. Except as otherwise contemplated by this Agreement, to
      the
      extent that a party hereto took an action inconsistent herewith or failed to
      take action consistent herewith or required hereby pursuant to an order or
      judgment of a court or other competent authority, such party shall incur no
      liability or obligation unless such party did not in good faith seek to resist
      or object to the imposition or entering of such order or judgment.

     

    
      
        
        

      

      
        26

        
          

        

      

      
        
        

      

    

     

    IN
      WITNESS WHEREOF, the Parties have caused this Agreement to be signed as of
      the
      date first written above.

     

    
      	 	 	 
	 	IDO
              SECURITY LIMITED
	 
 	 
 	 
 
	 	By:  	 /s/
              Gill Stiss
	 	
              

            
	 	President

    

     

    
      	 	 	 
	 	THE
              MEDICAL EXCHANGE INC.
	 
 	 
 	 
 
	 	By:  	 /s/
              Michael Golberg
	 	
              

            
	 	President     

    List
      Vendors

    
      	 	 	 	 
	/s/ Gil Stiss	 	 	 
	
              

              Gil
                Stiss   

            	 	 	
            
	 	 	 	 
	/s/
              Yoav Hirsh
              
              

              Yoav
                Hirsh   

            	 	 	 
	 	 	 	 
	/s/ 
              Shlomo Helbershtat
              
              

              Shlomo
                Helbershtat 

            	 	 	 
	 	 	 	 
	/s/
              Gerald Brounstein 

              

              Aboudi
                & Brounstein, Law Offices   

            	 	 	 

     

    
      
        
        

      

      
        27

        
          

        

      

      
        
        

      

    

    

    Appendix
      A

     

    
      
        
          	 

                  Name

                	
                   

                	
                  #
                    of Shares
of Company

                	
                   

                	
                  Purchase
                    Price

                	
                   

                
	
                  Gil
                    Stiss

                	 	 	
                  780

                	 	
                  $

                	
                  655,000

                	 
	 	 	 	 	 	 	 	 
	
                  Yoav
                    Hirsh

                	 	 	
                  200

                	 	
                  $

                	
                  250,000

                	 
	 	 	 	 	 	 	 	 
	
                  Shlomo
                    Helbershtat

                	 	 	
                  20

                	 	
                  $

                	
                  95,000

                	 
	 	 	 	 	 	 	 	 
	
                  Aboudi
                    & Brounstein 

                	 	 	
                  25

                	 	 	
                  0

                	 

        
    

    

    
      
        
        

      

      
        28

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00119-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00119-of-00352.parquet"}]]