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<SEC-DOCUMENT>0001178913-07-000908.txt : 20070507
<SEC-HEADER>0001178913-07-000908.hdr.sgml : 20070507
<ACCEPTANCE-DATETIME>20070507172259
ACCESSION NUMBER:		0001178913-07-000908
CONFORMED SUBMISSION TYPE:	6-K
PUBLIC DOCUMENT COUNT:		6
CONFORMED PERIOD OF REPORT:	20070507
FILED AS OF DATE:		20070507
DATE AS OF CHANGE:		20070507

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			SILICOM LTD
		CENTRAL INDEX KEY:			0000916793
		STANDARD INDUSTRIAL CLASSIFICATION:	COMPUTER COMMUNICATIONS EQUIPMENT [3576]
		IRS NUMBER:				000000000
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		6-K
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	000-23288
		FILM NUMBER:		07824989

	BUSINESS ADDRESS:	
		STREET 1:		08 HANAGAR ST
		CITY:			KFAR-SAVA ISRAEL
		STATE:			L3
		ZIP:			44000
		BUSINESS PHONE:		97297644555

	MAIL ADDRESS:	
		STREET 1:		P.O.BOX 2164
		CITY:			KFAR-SAVA
		STATE:			L3
		ZIP:			44000
</SEC-HEADER>
<DOCUMENT>
<TYPE>6-K
<SEQUENCE>1
<FILENAME>zk73702.htm
<TEXT>
<HTML>
<HEAD>
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     <!-- Control Number: 73702                                                            -->
     <!-- Rev Number:     1                                                                -->
     <!-- Client Name:    Silicom Ltd                                                      -->
     <!-- Project Name:   6-K                                                              -->
     <!-- Firm Name:      Zadok-Keinan Ltd                                                 -->
     <TITLE>6-K</TITLE>
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<H1 Align=CENTER><Font Face="Times New Roman, Times, Serif" Size=4>SECURITIES AND
EXCHANGE COMMISSION </font></h1>

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<H1 Align=CENTER><Font Face="Times New Roman, Times, Serif" Size=3>WASHINGTON, D.C. 20549 </font></h1>

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<H1 Align=CENTER><Font Face="Times New Roman, Times, Serif" Size=4>FORM 6-K </font></h1>

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<H1 Align=CENTER><Font Face="Times New Roman, Times, Serif" Size=3>REPORT OF FOREIGN
PRIVATE ISSUER </font></h1>

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<H1 Align=CENTER><Font Face="Times New Roman, Times, Serif" Size=3>PURSUANT TO RULE
13a-16 OR 15d-16 OF </font></h1>

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<H1 Align=CENTER><Font Face="Times New Roman, Times, Serif" Size=3>THE SECURITIES
EXCHANGE ACT OF 1934 </font></h1>

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<P Align=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><B><I>For the month of May,
2007</I></B> </FONT> </p>

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<H1 Align=CENTER><Font Face="Times New Roman, Times, Serif" Size=5>SILICOM LTD. </font></h1>

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<P Align=CENTER><Font Face="Times New Roman, Times, Serif" Size=2>(Translation of
Registrant&#146;s name into English) </font></p>

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<Hr Size="1" Noshade Width="15%" Align="Center">

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<H1 Align=CENTER><Font Face="Times New Roman, Times, Serif" Size=2>8 Hanagar St., P.O.Box
2164, Kfar-Sava 44425, Israel </font></h1>

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<P Align=CENTER><Font Face="Times New Roman, Times, Serif" Size=2>(Address of Principal
Executive Offices) </font></p>

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<Hr Size="1" Noshade Width="15%" Align="Center">

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<P><Font Face="Times New Roman, Times, Serif" Size=2>Indicate by check mark whether the
registrant files or will file annual reports under cover of Form 20-F or Form 40-F: </font></p>

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<H1 Align="Center"><Font Face="Times New Roman, Times, Serif" Size=2>Form 20-F <FONT size="3" face="Wingdings">x
</font> Form 40-F <FONT size="3" face="Wingdings">o
</font></font></H1>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>Indicate by check mark whether the
registrant by furnishing the information contained in this form is also thereby furnishing
the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange
Act of 1934: </font></p>

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<H1 Align="Center"><Font Face="Times New Roman, Times, Serif" Size=2>Yes  <FONT size="3" face="Wingdings">o
</font> No <FONT size="3" face="Wingdings">x</font></font></H1>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>On May 4, 2007, the Registrant
announced a private placement of its ordinary shares and warrants. The Registrant engaged
Cowen and Company, LLC and W.R. Hambrecht + Co., LLC as exclusive placement agents for the
offering. For their services, the placement agents will be issued warrants for the
purchase of up to an aggregate of 10,938 shares upon the same terms as the warrants to be
issued to the investors, as well as a cash fee and reimbursement for certain expenses. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>Attached hereto are the forms of
agreements entered into in connection with the announced transaction. </font></p>

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<td Width=12%><Font Face="Times New Roman, Times, Serif" Size=2>Exhibit 99.1  </font></td>
<td Width=88%><Font Face="Times New Roman, Times, Serif" Size=2>Form
of Securities Purchase Agreement, dated May 3, 2007, by and among Silicom Ltd. and the
investors identified therein (the &#147;Investors&#148;).  </font></td>
</tr>
</table>
<br>

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<td Width=12%><Font Face="Times New Roman, Times, Serif" Size=2>Exhibit 99.2  </font></td>
<td Width=88%><Font Face="Times New Roman, Times, Serif" Size=2>Form
of  Securities  Purchase  Agreement,  dated May 3,  2007,  by and among  Silicom  Ltd.
 and CD Investment Partners, Ltd. </font></td>
</tr>
</table>
<br>

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<td Width=12%><Font Face="Times New Roman, Times, Serif" Size=2>Exhibit 99.3  </font></td>
<td Width=88%><Font Face="Times New Roman, Times, Serif" Size=2>Form
of Warrant between Silicom Ltd. and the Investors.  </font></td>
</tr>
</table>
<br>

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<td Width=12%><Font Face="Times New Roman, Times, Serif" Size=2>Exhibit 99.4  </font></td>
<td Width=88%><Font Face="Times New Roman, Times, Serif" Size=2>Form
of Warrant between Silicom Ltd. and CD Investment Partners, Ltd. </font></td>
</tr>
</table>
<br>

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<td Width=12%><Font Face="Times New Roman, Times, Serif" Size=2>Exhibit 99.5  </font></td>
<td Width=88%><Font Face="Times New Roman, Times, Serif" Size=2>Disclosure
Schedules to the Securities Purchase Agreements. </font></td>
</tr>
</table>
<br>



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<P Align=CENTER><Font Face="Times New Roman, Times, Serif" Size=2>Signature </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>Pursuant to the requirements of the
Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed
on its behalf by the undersigned, thereunto duly authorized. </font></p>
















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<td Width=10%><Font Face="Times New Roman, Times, Serif" Size=2></font></td>
<td Width=50%><Font Face="Times New Roman, Times, Serif" Size=2>SILICOM  Ltd.<Br>
(Registrant)<Br><Br>
<br>By:  /s/  Eran Gilad<br>&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;<br>
Eran Gilad<br>CFO</font></td>
</tr>
</table>
<br>

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<P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>Dated: May
7<Sup>th</sup>, 2007 </font></p>


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<DOCUMENT>
<TYPE>EX-99
<SEQUENCE>2
<FILENAME>exhibit_99-1.htm
<TEXT>
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     <!-- Project:        \\Backup\office\EDGAR Filing\Silicom Ltd\73702\a73702.eep        -->
     <!-- Control Number: 73702                                                            -->
     <!-- Rev Number:     1                                                                -->
     <!-- Client Name:    Silicom Ltd                                                      -->
     <!-- Project Name:   6-K                                                              -->
     <!-- Firm Name:      Zadok-Keinan Ltd                                                 -->
     <TITLE>6-K</TITLE>
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<P Align="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><U><B>Exhibit 99.1</B></U> </FONT> </P>

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<H1 Align=CENTER><Font Face="Times New Roman, Times, Serif" Size=2>SECURITIES PURCHASE
AGREEMENT </font></h1>

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<P><Font Face="Times New Roman, Times, Serif" Size=2><B>THIS SECURITIES PURCHASE
AGREEMENT</b> (the &#147;<B>Agreement</b>&#148;), dated as of May 3, 2007, by and among
Silicom Ltd., an Israeli corporation with headquarters located at 8 Hanagar Street, Kfar
Sava 44000, Israel (the &#147;<B>Company</b>&#148;), and the investors listed on the
Schedule of Investors attached hereto as <U>Exhibit&nbsp;A</u> (individually, an
&#147;<B>Investor</b>&#148; and collectively, the &#147;<B>Investors</b>&#148;). </font></p>

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<H1 Align=CENTER><Font Face="Times New Roman, Times, Serif" Size=2>BACKGROUND </font></h1>

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     <P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;A.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          The Company and each Investor are executing and delivering this Agreement in
          reliance upon the exemption from registration afforded by Section&nbsp;4(2) of
          the Securities Act of 1933, as amended (the &#147;<B>Securities Act</b>&#148;),
          and Rule&nbsp;506 of Regulation D (&#147;<B>Regulation D</b>&#148;) as
          promulgated by the United States Securities and Exchange Commission (the
          &#147;<B>SEC</b>&#148;) under the Securities Act. </font></p>

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     <P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;B.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          Each Investor, severally and not jointly, wishes to purchase, and the Company
          wishes to sell, upon the terms and conditions stated in this Agreement,
          (i)&nbsp;that aggregate number of Ordinary Shares, par value NIS 0.01 per share,
          of the Company (the &#147;<B>Ordinary Shares</b>&#148;), set forth opposite such
          Investor&#146;s name in column two (2) on the Schedule of Investors in
          <U>Exhibit&nbsp;A</u> (which aggregate amount shall collectively be referred to
          herein as the &#147;<B>Shares</b>&#148;) and (ii)&nbsp;warrants, in
          substantially the form attached hereto as <U>Exhibit F</u> (the
          &#147;<B>Warrants</b>&#148;) to acquire up to that number of additional Ordinary
          Shares set forth opposite such Investor&#146;s name in column three (3) on the
          Schedule of Investors (the Ordinary Shares issuable upon exercise of or
          otherwise pursuant to the Warrants, collectively, the &#147;<B>Warrant
          Shares</b>&#148;). </font></p>

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     <P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;C.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          The Shares, the Warrants and the Warrant Shares issued pursuant to this
          Agreement are collectively referred to herein as the
          &#147;<B>Securities</b>.&#148; </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;NOW,
THEREFORE, IN CONSIDERATION of the mutual covenants contained in this Agreement, and for
other good and valuable consideration the receipt and adequacy of which are hereby
acknowledged, the Company and the Investors agree as follows: </font></p>

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<P Align="Center"><Font Face="Times New Roman, Times, Serif" Size=2>ARTICLE I </font><Br>
<Font Face="Times New Roman, Times, Serif" Size=2>DEFINITIONS </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.1
     <U>Definitions</u>.  In addition to the terms defined  elsewhere in this Agreement,  the
following terms have the meanings indicated: </font></p>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>6-K
Filing</b>&#148; has the meaning set forth in <U>Section 4.5</u>. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Affiliate</b>&#148;
means any Person that, directly or indirectly through one or more intermediaries, controls
or is controlled by or is under common control with a Person, as such terms are used in
and construed under Rule&nbsp;144 under the Securities Act. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Agents</b>&#148;
has the meaning set forth in <U>Section 3.1(l)</u>. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Agreement</b>&#148;
has the meaning set forth in the Preamble. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Best
Efforts</b>&#148; means the efforts that a prudent person desirous of achieving a result
would use in similar circumstances to ensure that such result is achieved as expeditiously
as practical; <U>provided</u>, <U>however</u>, that an obligation to use Best Efforts
under this Agreement does not require the Company to dispose of or make any change to its
business, expend any material funds or incur any other material burden. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Business
Day</b>&#148; means any day other than Saturday, Sunday or other day on which commercial
banks in the City of New York or in the State of Israel are authorized or required by law
to remain closed. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Closing</b>&#148;
means the closing of the purchase and sale of the Shares and the Warrants pursuant to
<U>Section&nbsp;2.1</u>. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Closing
Date</b>&#148; means the date and time of the Closing and shall be on such date and time
as is mutually agreed to by the Company and each Investor. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Closing
Price</b>&#148; means, for any date, the closing price per Ordinary Share for such date
(or the nearest preceding date) on the Nasdaq Capital Market or, if the Ordinary Shares
are not listed on the Nasdaq Capital Market, on the primary Eligible Market or exchange or
quotation system on which the Ordinary Shares is then listed or quoted. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>&#147;Company&#148;
</b>has the meaning set forth in the Preamble. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Company
Counsel</b>&#148; means Yigal Arnon &amp; Co., counsel to the Company. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Disclosure
Materials</b>&#148; has the meaning set forth in <U>Section&nbsp;3.1(g)</u>. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Effective
Date</b>&#148; means the date that the Registration Statement is first declared effective
by the SEC. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Effectiveness
Period</b>&#148; has the meaning set forth in <U>Section&nbsp;6.1(b)</u>. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Eligible
Market</b>&#148; means any of the New York Stock Exchange, the American Stock Exchange,
The Nasdaq Global Select Market, The Nasdaq Global Market or the OTC<Sup>&reg;</sup>
Bulletin Board. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Environmental
Laws</b>&#148; has the meaning set forth in <U>Section 3.1(dd)</u>. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Event</b>&#148;
has the meaning set forth in <U>Section&nbsp;6.1(d)</u>. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Event
Payments</b>&#148; has the meaning set forth in <U>Section&nbsp;6.1(d)</u>. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Exchange
Act</b>&#148; means the Securities Exchange Act of 1934, as amended. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Excluded Events</b>&#148;
has the meaning set forth in <U>Section&nbsp;6.1(d)(ii)</u>. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Excluded
Investors</b>&#148; means Cowen and Company, LLC, W.R.&nbsp;Hambrecht + Co. LLC, and their
respective Affiliates. </font></p>

<p align=center>
<font size=2>2</font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Filing
Date</b>&#148; means thirty-five (35) days after the Closing Date. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>GAAP</b>&#148;
has the meaning set forth in <U>Section 3.1(g)</u>. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Hazardous
Materials</b>&#148; has the meaning set forth in <U>Section 3.1(dd)</u>. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Indebtedness</b>&#148;
has the meaning set forth in <U>Section 3.1(aa)</u>. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Indemnified
Party</b>&#148; has the meaning set forth in <U>Section&nbsp;6.4(c)</u>. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Indemnifying
Party</b>&#148; has the meaning set forth in <U>Section&nbsp;6.4(c)</u>. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Insolvent</b>&#148;
has the meaning set forth in <U>Section 3.1(h)</u>. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Intellectual
Property</b>&#148; has the meaning set forth in <U>Section&nbsp;3.1(t)</u>. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Investor</b>&#148;
and &#147;<B>Investors</b>&#148; have the meanings set forth in the Preamble.<U></u> </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Lien</b>&#148;
means any lien, charge, claim, security interest, encumbrance, right of first refusal or
other restriction. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Losses</b>&#148;
means any and all losses, claims, damages, liabilities, settlement costs and expenses,
including, without limitation, reasonable attorneys&#146; fees. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Material
Adverse Effect</b>&#148; means (i) a material adverse effect on the results of operations,
assets, business, or financial condition of the Company and the Subsidiaries, taken as a
whole on a consolidated basis, or (ii)&nbsp;a material and adverse impairment of the
Company&#146;s ability to perform its obligations under any of the Transaction Documents;
<U>provided</u>, that none of the following alone shall be deemed, in and of itself, to
constitute a Material Adverse Effect: (i) a change in the market price or trading volume
of the Ordinary Shares or other securities of the Company or (ii) changes in general
economic conditions or changes affecting the industry in which the Company operates
generally (as opposed to Company-specific changes) so long as such changes do not have a
disproportionate effect on the Company and its Subsidiaries taken as a whole. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Material
Permits</b>&#148; has the meaning set forth in <U>Section&nbsp;3.1(v)</u>. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Ordinary Shares</b>&#148;
has the meaning set forth in the preamble. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>&#147;Person</b>&#148;
means any individual or corporation, partnership, trust, incorporated or unincorporated
association, joint venture, limited liability company, or joint stock company. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Proceeding</b>&#148;
means an action, claim, suit, investigation or proceeding (including, without limitation,
a partial proceeding, such as a deposition), whether commenced or threatened in writing. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Prospectus</b>&#148;
means the prospectus included in the Registration Statement (including, without
limitation, a prospectus that includes any information previously omitted from a
prospectus filed as part of an effective registration statement in reliance upon Rule 430A
promulgated under the Securities Act), as amended or supplemented by any prospectus
supplement, with respect to the terms of the offering of any portion of the Registrable
Securities covered by the Registration Statement, and all other amendments and supplements
to the Prospectus including post-effective amendments, and all material incorporated by
reference or deemed to be incorporated by reference in such Prospectus. </font></p>

<p align=center>
<font size=2>3</font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Registrable
Securities</b>&#148; means the Shares and the Warrant Shares issued or issuable pursuant
to the Transaction Documents, together with any securities issued or issuable up on any
stock split, dividend or other distribution, recapitalization or similar event with
respect to the foregoing. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Registration
Statement</b>&#148; means each registration statement required to be filed under
Article&nbsp;VI, including (in each case) any preliminary prospectus, the Prospectus,
amendments and supplements to such registration statement or Prospectus, including pre-
and post-effective amendments, any free-writing prospectus, all exhibits thereto, and all
material incorporated by reference or deemed to be incorporated by reference in such
registration statement. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Regulation
D</b>&#148; has the meaning set forth in the Preamble. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Required
Effectiveness Date</b>&#148; means the date which is the earliest of (i) if the
Registration Statement does not become subject to review by the SEC, the earliest of (a)
ninety (90) days after the Closing Date and (b) five (5) Trading Days after the Company
receives notification from the SEC that the Registration Statement will not become subject
to review and the Company fails to request the acceleration of the effectiveness of the
Registration Statement; <U>provided</u>, that in the opinion of counsel to the Company a
pre-effective amendment to the Registration Statement is not required under the Securities
Act or (ii) if the Registration Statement becomes subject to review by the SEC, one
hundred and fifty (150) days after the Closing Date. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Rule&nbsp;144</b>,&#148;
&#147;<B>Rule&nbsp;415</b>,&#148; and &#147;<B>Rule&nbsp;424</b>&#148; means
Rule&nbsp;144, Rule&nbsp;415 and Rule&nbsp;424, respectively, promulgated by the SEC
pursuant to the Securities Act, as such Rules may be amended from time to time, or any
similar rule or regulation hereafter adopted by the SEC having substantially the same
effect as such Rule. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>&#147;SEC&#148;</b>
has the meaning set forth in the Preamble. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>SEC
Reports</b>&#148; has the meaning set forth in <U>Section&nbsp;3.1(g)</u>. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Securities</b>&#148;
has the meaning set forth in the Preamble. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Securities
Act</b>&#148; has the meaning set forth in the Preamble. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Shares</b>&#148;
means the Company&#146;s Ordinary Shares offered hereby to be purchased by the Investors
at the Closing. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Short
Sales</b>&#148; has the meaning set forth in <U>Section 3.2(h)</u>. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Subsidiary</b>&#148;
means any direct or indirect subsidiary of the Company. </font></p>

<p align=center>
<font size=2>4</font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Trading
Day</b>&#148; means (a)&nbsp;any day on which the Ordinary Shares are listed or quoted and
traded on its primary Trading Market, (b)&nbsp;if the Ordinary Shares are not then listed
or quoted and traded on any Eligible Market, then a day on which trading occurs on The
Nasdaq Global Market (or any successor thereto), or (c)&nbsp;if trading ceases to occur on
The Nasdaq Global Market (or any successor thereto), any Business Day. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Trading
Market</b>&#148; means the Nasdaq Capital Market or any other Eligible Market, or any
national securities exchange, market or trading or quotation facility on which the
Ordinary Shares are listed or quoted. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>&#147;Transaction
Documents</b>&#148; means this Agreement, the schedules and exhibits attached hereto, the
Warrants and the Transfer Agent Instructions. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Transfer
Agent</b>&#148; means American Stock Transfer &amp; Trust Company, or any successor
transfer agent for the Company. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Transfer
Agent Instructions</b>&#148; means, with respect to the Company, the Irrevocable Transfer
Agent Instructions, in the form of <U>Exhibit&nbsp;E</u>, executed by the Company and
delivered to and acknowledged in writing by the Transfer Agent. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>&#147;Warrants</b>&#148;
has the meaning set forth in the Preamble. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Warrant
Shares</b>&#148; has the meaning set forth in the Preamble. </font></p>

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<P Align="Center"><Font Face="Times New Roman, Times, Serif" Size=2>ARTICLE II </font><Br>
<Font Face="Times New Roman, Times, Serif" Size=2>PURCHASE AND SALE </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1
<U>Closing</u>. Subject to the terms and conditions set forth in this Agreement, at the
Closing the Company shall issue and sell to each Investor, and each Investor shall,
severally and not jointly, purchase from the Company, such number of Shares and Warrants
for the price set forth opposite such Investor&#146;s name on <U>Exhibit&nbsp;A</u> hereto
under the headings &#147;Shares&#148;and &#147;Warrants&#148;. The date and time of the
Closing and shall be 11:00 a.m., New York City Time, on the Closing Date. The Closing
shall take place at the offices of the Morrison &amp; Foerster LLP, 1290 Avenue of the
Americas, New York, New York 10104.  </font></p>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2
<U>Closing Deliveries</u>.  </font></p>


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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)
                    At the Closing, the Company shall deliver or cause to be delivered to
each                     Investor the following:  </font>
</td>
</tr>
</table>
<br>

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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=10%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)
                    one or more stock certificates (or copies thereof provided by the
Transfer                     Agent), free and clear of all restrictive and other legends
(except as expressly                     provided in <U>Section&nbsp;4.1(b</u>) hereof),
evidencing such number of Shares                     set forth opposite such Investor&#146;s
name on <U>Exhibit&nbsp;A</u> hereto                     under the heading &#147;Shares,&#148; registered
in the name of such Investor;  </font>
</td>
</tr>
</table>
<br>

<p align=center>
<font size=2>5</font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>


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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=10%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)
                    a Warrant, issued in the name of such Investor, pursuant to which
such Investor                     shall have the right to acquire such number of Warrant
Shares set forth opposite                     such Investor&#146;s name on <U>Exhibit&nbsp;A
</u> hereto under the heading                     &#147;Warrant Shares&#148;;  </font>
</td>
</tr>
</table>
<br>

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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=10%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)
                    a legal opinion of Company Counsel, in the form of <U>Exhibit&nbsp;C</u>,
                    executed by such counsel and delivered to the Investors;  </font>
</td>
</tr>
</table>
<br>

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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=10%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv)
                    a certificate executed by the chief executive officer and the chief
financial or                     accounting officer of the Company, dated as of the
Closing Date, to the effect                     that the representations and warranties
of the Company set forth herein are true                     and correct as of the date
of this Agreement and as of such Closing Date and                     that the Company
has complied with all the agreements and satisfied all the                     conditions
herein on its part to be performed or satisfied on or prior to such
                    Closing Date;  </font>
</td>
</tr>
</table>
<br>

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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=10%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v)
                    duly executed Transfer Agent Instructions acknowledged by the Company&#146;s
                    transfer agent; and  </font>
</td>
</tr>
</table>
<br>

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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=10%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi)
                    proof of delivery to each applicable Trading Market of an additional
shares                     listing application covering all of the Registrable
Securities.  </font>
</td>
</tr>
</table>
<br>

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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)
                    At the Closing, each Investor shall deliver or cause to be delivered
to the                     Company the purchase price set forth opposite such Investor&#146;s
name on <U>Exhibit&nbsp;A</u> hereto under the heading &#147;Purchase Price&#148; in
                    United States dollars and in immediately available funds, by wire
transfer to an                     account designated in writing to such Investor by the
Company for such purpose.  </font>
</td>
</tr>
</table>
<br>

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<P Align="Center"><Font Face="Times New Roman, Times, Serif" Size=2>ARTICLE III </font><Br>
<Font Face="Times New Roman, Times, Serif" Size=2>REPRESENTATIONS AND
WARRANTIES </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.1 <U>Representations and Warranties of the Company</u>. The Company hereby represents and
warrants to the Investors as follows (which representations and warranties shall be
deemed to apply, where appropriate, to each Subsidiary of the Company):  </font></p>


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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)
<U>Subsidiaries</u>. The Company has no Subsidiaries other than those listed in <U>Schedule&nbsp;3.1(a</u>)
hereto. Except as disclosed in <U>Schedule&nbsp;3.1(a</u>) hereto, the Company owns,
directly or indirectly,                     all of the capital stock or comparable equity
interests of each Subsidiary free                     and clear of any Lien and all the
issued and outstanding shares of capital stock                     or comparable equity
interest of each Subsidiary are validly issued and are                     fully paid,
non-assessable and free of preemptive and similar rights.  </font>
</td>
</tr>
</table>
<br>

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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)
<U>Organization and Qualification</u>. Each of the Company and the Subsidiaries
                    is an entity duly organized, validly existing and in good standing
under the                     laws of the jurisdiction of its incorporation or
organization (as applicable),                     with the requisite legal authority to
own and use its properties and assets and                     to carry on its business as
currently conducted. Neither the Company nor any                     Subsidiary is in
violation of any of the provisions of its respective                     certificate or
articles of incorporation, bylaws or other organizational or                     charter
documents. Each of the Company and the Subsidiaries is duly qualified to
                    do business and is in good standing as a foreign corporation or other
entity in                     each jurisdiction in which the nature of the business
conducted or property                     owned by it makes such qualification necessary,
except where the failure to be                     so qualified or in good standing, as
the case may be, would not, individually or                     in the aggregate, have or
reasonably be expected to result in a Material Adverse                     Effect.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)
<U>Authorization; Enforcement</u>. The Company has the requisite corporate
                    authority to enter into and to consummate the transactions
contemplated by each                     of the Transaction Documents to which it is a
party and otherwise to carry out                     its obligations hereunder and
thereunder. The execution and delivery of each of                     the Transaction
Documents to which it is a party by the Company and the                     consummation
by it of the transactions contemplated hereby and thereby have been
                    duly authorized by all necessary corporate action on the part of the
Company and                     no further consent or action is required by the Company,
its Board of Directors                     or its stockholders. Each of the Transaction
Documents to which it is a party                     has been (or upon delivery will be)
duly executed by the Company and is, or when                     delivered in accordance
with the terms hereof and thereof, will constitute, the                     valid and
binding obligation of the Company enforceable against the Company in
                    accordance with its terms, except as may be limited by (i)&nbsp;applicable
                    bankruptcy, insolvency, reorganization or other laws of general
application                     relating to or affecting the enforcement of creditors
rights generally, and                     (ii)&nbsp;the effect of rules of law governing
the availability of specific                     performance and other equitable
remedies.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)
<U>No Conflicts</u>. The execution, delivery and performance by the Company of
                    the Transaction Documents to which it is a party and the consummation
by the                     Company of the transactions contemplated hereby and thereby do
not, and will                     not, (i)&nbsp;conflict with or violate any provision of
the Company&#146;s or                     any Subsidiary&#146;s certificate or articles
of incorporation, bylaws or other                     organizational or charter
documents, (ii)&nbsp;conflict with, or constitute a                     default (or an
event that with notice or lapse of time or both would become a
                    default) under, or give to others any rights of termination,
amendment,                     acceleration or cancellation (with or without notice,
lapse of time or both) of,                     any agreement, credit facility, debt or
other instrument (evidencing a Company                     or Subsidiary debt or
otherwise) or other understanding to which the Company or                     any
Subsidiary is a party or by which any property or asset of the Company or
                    any Subsidiary is bound or affected, except to the extent that such
conflict,                     default, termination, amendment, acceleration or
cancellation right would not                     reasonably be expected to have a
Material Adverse Effect, or (iii) except as set                     forth on Schedule
3.1(d), result in a violation of any law, rule, regulation,                     order,
judgment, injunction, decree or other restriction of any court,
                    arbitrator or governmental authority to which the Company or a
Subsidiary is                     subject (including, assuming the accuracy of the
representations and warranties                     of the Investors set forth in <U>Section
3.2</u> hereof, federal and state                     securities laws and regulations and
the rules and regulations of any                     self-regulatory organization to
which the Company or its securities are subject,                     including all
applicable Trading Markets), or by which any property or asset of                     the
Company or a Subsidiary is bound or affected, except to the extent that such
                    violation would not reasonably be expected to have a Material Adverse
Effect.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)
<U>Securities</u>. The Securities (including the Warrant Shares) are duly
                    authorized and, when issued and paid for in accordance with the
Transaction                     Documents, will be duly and validly issued, fully paid
and nonassessable, free                     and clear of all Liens and will not be
subject to preemptive or similar rights                     of shareholders (other than
those imposed by the Investors). The Company has                     reserved from its
duly authorized capital stock the maximum number of Ordinary                     Shares
issuable upon exercise of the Warrants. Assuming the accuracy of the
                    representations and warranties of the Investors set forth in <U>Section&nbsp;3.2</u>,
the offer, issuance and sale of the Shares and the                     Warrants to the
Investors pursuant to the Agreement, and in the case of the                     Warrant
Shares, pursuant to the Warrants, are exempt from the registration
                    requirements of the Securities Act.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)
<U>Capitalization</u>. The aggregate number of shares and type of all
                    authorized, issued and outstanding classes of capital stock, options
and other                     securities of the Company (whether or not presently
convertible into or                     exercisable or exchangeable for shares of capital
stock of the Company) is set                     forth in <U>Schedule&nbsp;3.1(f</u>)
hereto. All outstanding shares of capital                     stock are duly authorized,
validly issued, fully paid and nonassessable and have                     been issued in
compliance in all material respects with all applicable                     securities
laws. Except as disclosed in <U>Schedule&nbsp;3.1(f</u>) hereto, the
                    Company did not have outstanding at March&nbsp;31, 2007 any other
options,                     warrants, script rights to subscribe to, calls or
commitments of any character                     whatsoever relating to, or securities,
rights or obligations convertible into or                     exercisable or exchangeable
for, or entered into any agreement giving any Person                     any right to
subscribe for or acquire, any Ordinary Shares or securities or                     rights
convertible or exchangeable into Ordinary Shares. Except as set forth on <U>Schedule 3.1(f</u>)
hereto, and except for customary adjustments as a result                     of stock
dividends, stock splits, combinations of shares, reorganizations,
                    rights offerings, cash dividends, recapitalizations,
reclassifications or other                     similar events, there are no anti-dilution
or price adjustment provisions                     contained in any security issued by
the Company (or in any agreement providing                     rights to security
holders) and the issuance and sale of the Securities will not
                    obligate the Company to issue Ordinary Shares or other securities to
any Person                     (other than the Investors) and will not result in a right
of any holder of                     securities to adjust the exercise, conversion,
exchange or reset price under                     such securities. To the knowledge of
the Company, except as disclosed in the SEC                     Reports and any Schedules
filed with the SEC pursuant to Rule 13d-1 of the                     Exchange Act by
reporting persons or in <U>Schedule </u><U>3.1(f</u>) hereto,                     no
Person or group of related Persons beneficially owns (as determined pursuant
                    to Rule 13d-3 under the Exchange Act), or has the right to acquire,
by agreement                     with or by obligation binding upon the Company,
beneficial ownership of in                     excess of 5% of the outstanding Ordinary
Shares.  </font>
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<font size=2>8</font></p>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g)
<U>SEC Reports</u>. Except as set forth on <U>Schedule 3.1(g)</u>, the Company
                    has filed all reports required to be filed by it under the Exchange
Act,                     including pursuant to Section&nbsp;13(a) or 15(d) thereof, for
the twelve (12)                     months preceding the date hereof on a timely basis or
has received a valid                     extension of such time of filing and has filed
any such SEC Reports prior to the                     expiration of any such extension
and has filed all reports required to be filed                     by it under the
Exchange Act, including pursuant to Section 13(a) or 15(d)                     thereof,
for the two (2) years preceding the date hereof. Such reports required
                    to be filed by the Company under the Exchange Act, including pursuant
to Section                     13(a) or 15(d) thereof, together with any materials filed
or furnished by the                     Company under the Exchange Act, whether or not
any such reports were required                     being collectively referred to herein
as the &#147;<B>SEC Reports</b>&#148; and,                     together with this
Agreement and the <U>Schedules</u> to this Agreement, the                     &#147;<B>Disclosure
Materials</b>&#148;. As of their respective dates (or if                     amended or
superseded by a filing prior to the date hereof, then on the date of
                    such filing), the SEC Reports filed by the Company complied in all
material                     respects with the requirements of the Securities Act and the
Exchange Act and                     the rules and regulations of the SEC promulgated
thereunder, and none of the SEC                     Reports, when filed by the Company
(or if amended or superseded by a filing                     prior to the date hereof,
then on the date of such filing), contained any untrue                     statement of a
material fact or omitted to state a material fact required to be
                    stated therein or necessary in order to make the statements therein,
in the                     light of the circumstances under which they were made, not
misleading. The                     financial statements of the Company included in the
SEC Reports comply in all                     material respects with applicable
accounting requirements and the rules and                     regulations of the SEC with
respect thereto as in effect at the time of filing                     (or if amended or
superseded by a filing prior to the date hereof, then on the                     date of
such filing). Such financial statements have been prepared in accordance
                    with United States generally accepted accounting principles applied
on a                     consistent basis during the periods involved (&#147;<B>GAAP</b>&#148;),
except                     as may be otherwise specified in such financial statements,
the notes thereto                     and except that unaudited financial statements may
not contain all footnotes                     required by GAAP or may be condensed or
summary statements, and fairly present                     in all material respects the
consolidated financial position of the Company and                     its consolidated
Subsidiaries as of and for the dates thereof and the results of
                    operations and cash flows for the periods then ended, subject, in the
case of                     unaudited statements, to normal, year-end audit adjustments.
All material                     agreements to which the Company or any Subsidiary is a
party or to which the                     property or assets of the Company or any
Subsidiary are subject are included as                     part of or identified in the
SEC Reports, to the extent such agreements are                     required to be
included or identified pursuant to the rules and regulations of                     the
SEC.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h)
<U>Financial Statements</u>. Since the date of the latest audited financial
                    statements included within the SEC Reports, except as disclosed in
the SEC                     Reports or in <U>Schedule 3.1(h)</u> hereto, (i)&nbsp;there
has been no event,                     occurrence or development that, individually or in
the aggregate, has had or                     that would result in a Material Adverse
Effect, (ii)&nbsp;the Company has not                     incurred any material
liabilities other than (A)&nbsp;trade payables and accrued                     expenses
incurred in the ordinary course of business consistent with past
                    practice and (B)&nbsp;liabilities not required to be reflected in the
                    Company&#146;s financial statements pursuant to GAAP or required to
be disclosed                     in filings made with the SEC, (iii)&nbsp;the Company has
not altered its method                     of accounting or changed its auditors, except
as disclosed in its SEC Reports,                     (iv)&nbsp;the Company has not
declared or made any dividend or distribution of                     cash or other
property to its stockholders, in their capacities as such, or
                    purchased, redeemed or made any agreements to purchase or redeem any
shares of                     its capital stock (except for repurchases by the Company of
shares of capital                     stock held by employees, officers, directors, or
consultants pursuant to an                     option of the Company to repurchase such
shares upon the termination of                     employment or services), and (v)&nbsp;the
Company has not issued any equity                     securities to any officer, director
or Affiliate, except pursuant to existing                     Company stock-based plans
or other arrangements. The Company has not taken any                     steps to seek
protection pursuant to any bankruptcy law nor does the Company                     have
any knowledge or reason to believe that its creditors intend to initiate
                    involuntary bankruptcy proceedings or any actual knowledge of any
fact which                     would reasonably lead a creditor to do so. The Company is
not as of the date                     hereof, and after giving effect to the
transactions contemplated hereby to occur                     at the applicable Closing,
will not be Insolvent (as defined below). For                     purposes of this <U>Section
3.1(h)</u>, &#147;<B>Insolvent</b>&#148; means (i)                     the Company is
unable to pay its debts and liabilities, subordinated, contingent                     or
otherwise, as such debts and liabilities become absolute and matured, (ii)
                    the Company intends to incur or believes that it will incur debts
that would be                     beyond its ability to pay as such debts mature or (iii)
the Company has                     unreasonably small capital with which to conduct the
business in which it is                     engaged as such business is now conducted and
is proposed to be conducted.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)
<U>Absence of Litigation</u>. Except as disclosed in the SEC Reports or in <U>Schedule
3.1(i)</u>, there is no action, suit, claim, or Proceeding, or, to
                    the Company&#146;s knowledge, inquiry or investigation, before or by
any court,                     public board, government agency, self-regulatory
organization or body pending                     or, to the knowledge of the Company,
threatened against or affecting the Company                     or any of its
Subsidiaries that could, individually or in the aggregate, have a
                    Material Adverse Effect.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j)
<U>Compliance</u>. Except as described in <U>Schedule 3.1(j)</u>, neither the
                    Company nor any Subsidiary, except in each case as would not,
individually or in                     the aggregate, reasonably be expected to have or
result in a Material Adverse                     Effect, (i)&nbsp;is in default under or
in violation of (and no event has                     occurred that has not been waived
that, with notice or lapse of time or both,                     would result in a default
by the Company or any Subsidiary under), nor has the                     Company or any
Subsidiary received written notice of a claim that it is in                     default
under or that it is in violation of, any indenture, loan or credit
                    agreement or any other agreement or instrument to which it is a party
or by                     which it or any of its properties is bound (whether or not such
default or                     violation has been waived), (ii)&nbsp;is in violation of
any order of any court,                     arbitrator or governmental body, or (iii)&nbsp;is
or has been in violation of                     any law, statute, rule or regulation of
any governmental authority.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(k)
<U>Title to Assets</u>. The Company and the Subsidiaries have good and
                    marketable title to all real property owned by them that is material
to the                     business of the Company and the Subsidiaries and good and
marketable title in                     all personal property owned by them that is
material to the business of the                     Company and the Subsidiaries, in each
case free and clear of all Liens, except                     for Liens that do not,
individually or in the aggregate, have or result in a                     Material
Adverse Effect. Any real property and facilities held under lease by
                    the Company and the Subsidiaries are held by them under valid,
subsisting and                     enforceable leases of which the Company and the
Subsidiaries are in material                     compliance.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(l)
<U>No General Solicitation; Placement Agents&#146; Fees</u>. Neither the Company
                    nor any of its Affiliates, nor any Person acting on its or their
behalf, has                     engaged in any form of general solicitation or general
advertising (within the                     meaning of Regulation&nbsp;D) in connection
with the offer or sale of the                     Securities. The Company shall be
responsible for the payment of any placement                     agent&#146;s fees,
financial advisory fees, or brokers&#146; commission (other                     than for
persons engaged by any Investor or its investment advisor) relating to
                    or arising out of the issuance of the Securities pursuant to this
Agreement. The                     Company shall pay, and hold each Investor harmless
against, any liability, loss                     or expense (including, without
limitation, reasonable attorney&#146;s fees and                     out-of-pocket
expenses) arising in connection with any such claim for fees                     arising
out of the issuance of the Securities pursuant to this Agreement. The
                    Company acknowledges that it has engaged Cowen and Company, LLC and
W.R.                     Hambrecht + Co., LLC as its exclusive placement agents (the
                    &#147;<B>Agents</b>&#148;) in connection with the sale of the
Securities. Other                     than the Agents, the Company has not engaged any
placement agent or other agent                     in connection with the sale of the
Securities.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(m)
<U>Private Placement</u>. Neither the Company nor any of its Affiliates nor, any
                    Person acting on the Company&#146;s behalf has, directly or
indirectly, at any                     time within the past six (6) months, made any
offer or sale of any security or                     solicitation of any offer to buy any
security under circumstances that would                     (i)&nbsp;eliminate the
availability of the exemption from registration under                     Regulation&nbsp;D
under the Securities Act in connection with the offer and sale                     by the
Company of the Securities as contemplated hereby or (ii)&nbsp;cause the
                    offering of the Securities pursuant to the Transaction Documents to
be                     integrated with prior offerings. Assuming the accuracy of the
representations                     and warranties of Investors, the offer and sale of
the Securities by the Company                     to the Investors pursuant to this
Agreement will be exempt from the registration                     requirements of the
Securities Act. The Company is not required to be registered                     as, and
is not an Affiliate of, an &#147;investment company&#148; within the
                    meaning of the Investment Company Act of 1940, as amended. The
Company is not                     required to be registered as, a United States real
property holding corporation                     within the meaning of the Foreign
Investment in Real Property Tax Act of 1980.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(n)
<U>Form F-3 Eligibility</u>. The Company is eligible to register the Shares and
                    the Warrant Shares for resale by the Investors using a registration
statement on                     Form F-3.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(o)
<U>Listing and Maintenance Requirements</u>. The Company has not, in the twelve
                    (12) months preceding the date hereof, received notice (written or
oral) from                     the Trading Market on which the Ordinary Shares are or
have been listed or                     quoted to the effect that the Company is not in
compliance with the listing or                     maintenance requirements of the
Trading Market. The Company is in compliance                     with all such listing
and maintenance requirements as they apply to the Company.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(p)
<U>Registration Rights</u>. Except as described in <U>Schedule 3.1(p)</u>, the
                    Company has not granted or agreed to grant to any Person any rights
(including                     &#147;piggy-back&#148; registration rights) to have any
securities of the                     Company registered with the SEC or any other
governmental authority that have                     not been satisfied or waived.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(q)
<U>Application of Takeover Protections</u>. Except as described in <U>Schedule
                    3.1(q)</u> or the SEC Reports, there are no control share
acquisition, business                     combination, poison pill (including any
distribution under a rights agreement)                     or other similar anti-takeover
provision under the Company&#146;s charter                     documents or the laws of
its state of incorporation that is or could become                     applicable to any
of the Investors as a result of the Investors and the Company
                    fulfilling their obligations or exercising their rights under the
Transaction                     Documents, including, without limitation, as a result of
the Company&#146;s                     issuance of the Securities and the Investors&#146; ownership
of the Securities.  </font>
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<font size=2>11</font></p>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(r)
<U>Disclosure</u>. The Company confirms that following the filing of the 6-K
                    Filing, neither it nor any officers, directors or Affiliates, will
have provided                     any of the Investors (other than Excluded Investors) or
their agents or counsel                     with any information that constitutes or
might constitute material, nonpublic                     information (other than the
existence and terms of the issuance of Securities,                     as contemplated by
this Agreement). The Company understands and confirms that                     each of
the Investors will rely on the foregoing representations in effecting
                    transactions in securities of the Company (other than Excluded
Investors). All                     disclosure provided by the Company to the Investors
regarding the Company, its                     business and the transactions contemplated
hereby, including the <U>Schedules</u> to this Agreement, furnished by or on the behalf
of the Company                     are true and correct in all material respects and do
not contain any untrue                     statement of a material fact or omit to state
any material fact necessary in                     order to make the statements made
therein, in the light of the circumstances                     under which they were
made, not misleading. To the Company&#146;s knowledge,                     except for the
transactions contemplated by this Agreement, no event or                     circumstance
has occurred or information exists with respect to the Company or                     any
of its Subsidiaries or its or their business, properties, operations or
                    financial condition, which, under applicable law, rule or regulation,
requires                     public disclosure or announcement by the Company but which
has not been so                     publicly announced or disclosed. The Company
acknowledges and agrees that no                     Investor (other than Excluded
Investors) makes or has made any representations                     or warranties with
respect to the transactions contemplated hereby other than                     those set
forth in the Transaction Documents.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(s)
<U>Acknowledgment Regarding Investors&#146; Purchase of Securities</u>. Based
                    upon the assumption that the transactions contemplated by this
Agreement are                     consummated in all material respects in conformity with
the Transaction                     Documents, the Company acknowledges and agrees that
each of the Investors (other                     than Excluded Investors) is acting
solely in the capacity of an arm&#146;s                     length purchaser with respect
to the Transaction Documents and the transactions                     contemplated hereby
and thereby. The Company further acknowledges that no                     Investor (other
than Excluded Investors) is acting as a financial advisor or
                    fiduciary of the Company (or in any similar capacity) with respect to
this                     Agreement and the transactions contemplated hereby and any
advice given by any                     Investor (other than Excluded Investors) or any
of their respective                     representatives or agents in connection with the
Transaction Documents and the                     transactions contemplated hereby and
thereby is merely incidental to the                     Investors&#146; purchase of the
Securities. The Company further represents to                     each Investor that the
Company&#146;s decision to enter into this Agreement has                     been based
solely on the independent evaluation of the transactions contemplated
                    hereby by the Company and its representatives.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(t)
<U>Patents and Trademarks</u>. Except as described in the SEC Reports, the
                    Company and each of its subsidiaries own or, to the Company&#146;s
best                     knowledge, possess a valid and enforceable right to use all: (i)
patents and                     patent applications, (ii) registered and unregistered
trademarks, service marks,                     trade names, trademark applications and
service mark applications, (iii)                     registered and unregistered
copyrights and copyright applications, and (iv)                     other intellectual
property (including trade secrets, licenses, know-how,                     software,
systems, technology and other unpatented and/or unpatentable
                    proprietary or confidential information, systems or procedures) (the
                    &#147;<B>Intellectual Property</b>&#148;) necessary for the conduct
of their                     respective businesses as now conducted. Except as set forth
in <U>Schedule                     3.1(t)</u> and off-the-shelf products, none of the
Company&#146;s Intellectual                     Property rights have expired or
terminated, or are expected to expire or                     terminate, within three (3)
years from the date of this Agreement. The Company                     does not have any
knowledge of any infringement by the Company or its                     Subsidiaries of
Intellectual Property rights of others and does not have any                     reason
to believe that the conduct of the businesses of the Company and its
                    Subsidiaries conflicts with any Intellectual Property rights of any
third party,                     nor has the Company or any of its Subsidiaries received
any notice of any claim                     of conflict with, any such Intellectual
Property rights of any third party,                     which claim, if the subject of an
unfavorable decision, ruling or judgment,                     would reasonably be
expected to result in a Material Adverse Effect. Except as                     disclosed
in the SEC Reports: (i) the Company is not aware of any infringement
                    by third parties of any of its Intellectual Property; (ii) there is
no pending                     or, to the Company&#146;s best knowledge, threatened
action, suit, proceeding or                     claim by others challenging the Company&#146;s
rights in or to any such                     Intellectual Property; and (iii) there is no
pending or, to the Company&#146;s                     best knowledge, threatened action,
suit, proceeding or claim by others that the                     Company infringes or
otherwise violates any patent, trademark, copyright, trade                     secret or
other proprietary rights of others.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(u)
<U>Insurance</u>. The Company and the Subsidiaries are insured by insurers of
                    recognized financial responsibility against such losses and risks and
in such                     amounts as are prudent and customary in the businesses and
location in which the                     Company and the Subsidiaries are engaged.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v)
<U>Regulatory Permits</u>. The Company and the Subsidiaries possess all
                    franchises, licenses, certificates, authorizations and permits issued
by the                     appropriate Israeli, United States federal, state, local or
foreign regulatory                     authorities necessary to conduct their respective
businesses as described in the                     SEC Reports (&#147;<B>Material Permits&#148;</b>),
except where the failure to                     possess such permits does not,
individually or in the aggregate, have or                     reasonably be expected to
result in a Material Adverse Effect; each such                     Material Permit is
valid and in full force and effect, and neither the Company                     nor any
Subsidiary has received any written notice of investigations or
                    proceedings relating to the revocation or modification of, or
imposition of a                     materially burdensome restriction on, any Material
Permit.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(w)
                    &nbsp;&nbsp;<U>Transactions With Affiliates and Employees</u>. Except
as set                     forth or incorporated by reference in the Company&#146;s SEC
Reports, none of                     the officers, directors or employees of the Company
is presently a party to any                     transaction that would be required to be
reported on a Form 20-F with the                     Company or any of its Subsidiaries
(other than for ordinary course services as                     employees, officers or
directors), including any contract, agreement or other                     arrangement
providing for the furnishing of services to or by, providing for
                    rental of real or personal property to or from, or otherwise
requiring payments                     to or from any such officer, director or employee
or, to the Company&#146;s                     knowledge, any corporation, partnership,
trust or other entity in which any such                     officer, director, or
employee has a substantial interest or is an officer,                     director,
trustee or partner.  </font>
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<font size=2>13</font></p>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(x)
<U>Internal Accounting Controls</u>. The Company and the Subsidiaries maintain a
                    system of internal accounting controls sufficient to provide
reasonable                     assurance that (i)&nbsp;transactions are executed in
accordance with                     management&#146;s general or specific authorizations,
(ii)&nbsp;transactions are                     recorded as necessary to permit
preparation of financial statements in                     conformity with generally
accepted accounting principles and to maintain asset                     accountability,
(iii)&nbsp;access to the Company&#146;s assets is permitted only                     in
accordance with management&#146;s general or specific authorization, and
                    (iv)&nbsp;the recorded accountability for assets is compared with the
existing                     assets at reasonable intervals and appropriate action is
taken with respect to                     any differences. The Company and each of its
Subsidiaries have established and                     maintain disclosure controls and
procedures (as such term is defined in Rule                     13a-15 promulgated under
the Exchange Act), (ii) such disclosure controls and                     procedures are
designed to ensure that the information required to be disclosed                     by
the Company and its Subsidiaries in the reports they will file or submit
                    under the Exchange Act is accumulated and communicated to management
of the                     Company and its Subsidiaries, including their respective
principal executive                     officers and principal financial officers, as
appropriate, to allow timely                     decisions regarding required disclosure
to be made and (iii) such disclosure                     controls and procedures are
effective in all material respects to perform the                     functions for which
they were established. Since the date of the most recent                     balance
sheet of the Company and its consolidated Subsidiaries reviewed or
                    audited by Somekh Chaikin, a member of KPMG International and the
audit                     committee of the board of directors of the Company, (i) the
Company has not been                     advised of (A) any significant deficiencies in
the design or operation of                     internal controls that could adversely
affect the ability of the Company and                     each of its Subsidiaries to
record, process, summarize and report financial                     data, or any material
weaknesses in internal controls and (B) any fraud, whether                     or not
material, that involves management or other employees who have a
                    significant role in the internal controls of the Company and each of
its                     Subsidiaries, and (ii) since that date, there have been no
significant changes                     in internal controls or in other factors that
could significantly affect                     internal controls, including any
corrective actions with regard to significant                     deficiencies and
material weaknesses.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(y)
<U>Sarbanes-Oxley Act</u>. The Company is in compliance in all material respects
                    with applicable requirements of the Sarbanes-Oxley Act of 2002 and
applicable                     rules and regulations promulgated by the SEC thereunder,
except where such                     noncompliance would not have, individually or in
the aggregate, a Material                     Adverse Effect.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(z)
<U>Foreign Corrupt Practices</u>. Neither the Company nor any of its
                    Subsidiaries nor, to the knowledge of the Company, any director,
officer, agent,                     employee or other Person acting on behalf of the
Company or any of its                     Subsidiaries has, in the course of its actions
for, or on behalf of, the Company                     (i) used any corporate funds for
any unlawful contribution, gift, entertainment                     or other unlawful
expenses relating to political activity; (ii) made any direct                     or
indirect unlawful payment to any foreign or domestic government official or
                    employee from corporate funds; (iii) violated or is in violation of
any                     provision of the U.S. Foreign Corrupt Practices Act of 1977, as
amended; or (iv)                     made any unlawful bribe, rebate, payoff, influence
payment, kickback or other                     unlawful payment to any foreign or
domestic government official or employee.  </font>
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<font size=2>14</font></p>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(aa)
<U>Employee Relations</u>. Neither the Company nor any of its Subsidiaries is a
                    party to any collective bargaining agreement or employs any member of
a union                     that relates to such employee&#146;s relationship with the
Company. The Company                     believes that its relations with its employees
are as disclosed in the SEC                     Reports. Except as disclosed in the SEC
Reports, during the twelve (12) month                     prior to the date hereof, no
executive officer of the Company or any of its                     Subsidiaries (as
defined in Rule 501(f) of the Securities Act) has notified the
                    Company or any such Subsidiary that such officer intends to leave the
Company or                     any such Subsidiary or otherwise terminate such officer&#146;s
employment with                     the Company or any such Subsidiary. To the knowledge
of the Company or any such                     Subsidiary, no executive officer of the
Company or any of its Subsidiaries is in                     violation of any material
term of any employment contract, confidentiality,                     disclosure or
proprietary information agreement, non-competition agreement, or                     any
other contract or agreement or any restrictive covenant, and the continued
                    employment of each such executive officer does not subject the
Company or any                     such Subsidiary to any material liability with respect
to any of the foregoing                     matters.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(bb)
<U>Labor Matters</u>. The Company and its Subsidiaries are in compliance in all
                    material respects with all applicable Israeli, federal, state, local
and foreign                     laws, rules, and regulations respecting labor, employment
and employment                     practices and benefits, terms and conditions of
employment and wages and hours,                     except where failure to be in
compliance would not, either individually or in                     the aggregate,
reasonably be expected to result in a Material Adverse Effect.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(cc)
<U>Environmental Laws</u>. The Company and its Subsidiaries (i) are in
                    compliance in all material respects with any and all Environmental
Laws (as                     hereinafter defined), (ii)&nbsp;have received all permits,
licenses or other                     approvals required of them under applicable
Environmental Laws to conduct their                     respective businesses and (iii)
are in compliance in all material respects with                     all terms and
conditions of any such permit, license or approval where, in each                     of
the foregoing clauses (i), (ii) and (iii), the failure to so comply would be
                    reasonably expected to have, individually or in the aggregate, a
Material                     Adverse Effect. The term &#147;<B>Environmental  Laws</b>&#148; means
all                     applicable Israeli and other laws, regulations, ordinances,
rules, orders,                     judgments, decrees, permits or other legal
requirements of any governmental                     authority, including without
limitation any international, national, state,                     provincial, regional,
or local authority, relating to the protection of human                     health or
safety, the environment, or natural resources (including, without
                    limitation, ambient air, surface water, groundwater, land surface or
subsurface                     strata), including, without limitation, laws relating to
emissions, discharges,                     releases or threatened releases of chemicals,
pollutants, contaminants, or toxic                     or hazardous substances or wastes
(collectively, &#147;<B>Hazardous                     Materials</b>&#148;) into the
environment, or otherwise relating to the                     manufacture, processing,
distribution, use, treatment, storage, disposal,                     transport or
handling of Hazardous Materials, as well as all authorizations,
                    codes, decrees, demands or demand letters, injunctions, judgments,
licenses,                     notices or notice letters, orders, permits, plans or
regulations issued,                     entered, promulgated or approved thereunder.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(dd)
<U>Subsidiary Rights</u>. Except as set forth in <U>Schedule 3.1(ee)</u>, the
                    Company or one of its Subsidiaries has the unrestricted right to
vote, and                     (subject to limitations imposed by applicable law) to
receive dividends and                     distributions on, all capital securities of its
Subsidiaries as owned by the                     Company or such Subsidiary.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ee)
<U>Tax Status.</u> The Company and each of its Subsidiaries (i) has made or
                    filed all foreign, federal and state income and all other tax
returns, reports                     and declarations required by any jurisdiction to
which it is subject, (ii) has                     paid all taxes and other governmental
assessments and charges that are material                     in amount, shown or
determined to be due on such returns, reports and                     declarations,
except those being contested in good faith and (iii) has set aside                     on
its books provision reasonably adequate for the payment of all taxes for
                    periods subsequent to the periods to which such returns, reports or
declarations                     apply. There are no unpaid taxes in any material amount
claimed to be due by the                     taxing authority of any jurisdiction, and
the officers of the Company and each                     of its Subsidiaries know of no
basis for any such claim.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ff)
<U>Approved Enterprise</u>. Except as set forth on Schedule 3.1(ff), the Company
                    is in compliance in all material respects with all conditions and
requirements                     stipulated by the instruments of approval granted to it
with respect to the                     &#147;Approved Enterprise&#148; status of any of
the facilities of the Company                     by Israeli laws and regulations
relating to such &#147;Approved Enterprise&#148;                    and the Company has
not received any notice of any proceeding or investigation                     relating
to revocation or modification of any &#147;Approved Enterprise&#148;                    status
granted with respect to any of the Company&#146;s facilities.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(gg)
<U>Office of Chief Scientist</u>. Except as set forth on Schedule 3.1(gg), the
                    Company is in compliance in all material respects with the conditions
and                     requirements of the instruments of approval granted to it by the
Office of Chief                     Scientist of the Israeli Ministry of Industry, Trade
and Labor and any                     applicable laws and regulations, including the Law
for the Encouragement of                     Industrial Research and Development, 1984,
with respect to any research and                     development grants given to it by
such office, and is in full compliance with                     the repayment of all
royalties, interest and penalties due under such laws and
                    regulations. All information supplied by the Company with respect to
such                     applications was true, correct and complete in all material
respects when                     supplied to the appropriate authorities.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(hh)
<U>Controlled Foreign Corporation</u>. The Company believes based on its current
                    ownership that it is not a Controlled Foreign Corporation within the
meaning of                     Section 957 of the Code.  </font>
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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.2
<U>Representations, Warranties and Covenants of the Investors</u>. Each Investor hereby,
as to itself only and for no other Investor, represents, warrants and covenants to the
Company as follows:  </font></p>


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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)
<U>Organization; Authority</u>. Such Investor is an entity duly organized,
                    validly existing and in good standing under the laws of the
jurisdiction of its                     organization with the requisite corporate,
partnership or other power and                     authority to enter into and to
consummate the transactions contemplated by the                     Transaction Documents
and otherwise to carry out its obligations hereunder and                     thereunder.
The purchase by such Investor of the Securities hereunder has been
                    duly authorized by all necessary corporate, partnership or other
action on the                     part of such Investor. This Agreement has been duly
executed and delivered by                     such Investor and constitutes the valid and
binding obligation of such Investor,                     enforceable against it in
accordance with its terms, except as may be limited by                     (i)&nbsp;applicable
bankruptcy, insolvency, reorganization or other laws of                     general
application relating to or affecting the enforcement of creditors rights
                    generally, and (ii)&nbsp;the effect of rules of law governing the
availability                     of specific performance and other equitable remedies.  </font>
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<font size=2>16</font></p>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)
<U>No Public Sale or Distribution</u>. Such Investor is (i)&nbsp;acquiring the
                    Shares and the Warrants and (ii)&nbsp;upon exercise of the Warrants
will acquire                     the Warrant Shares issuable upon exercise thereof, in
the ordinary course of                     business for its own account and not with a
view towards, or for resale in                     connection with, the public sale or
distribution thereof, except pursuant to                     sales registered under the
Securities Act or under an exemption from such                     registration and in
compliance with applicable federal and state securities                     laws, and
such Investor does not have a present arrangement to effect any
                    distribution of the Securities to or through any person or entity; <U>provided</u>,
<U>however</u>, that by making the representations herein, such
                    Investor does not agree to hold any of the Securities for any minimum
or other                     specific term and reserves the right to dispose of the
Securities at any time in                     accordance with or pursuant to a
registration statement or an exemption under                     the Securities Act.  </font>
</td>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)
<U>Investor Status</u>. At the time such Investor was offered the Securities, it
                    was, and at the date hereof it is, an &#147;accredited investor&#148; as
defined                     in Rule 501(a) under the Securities Act or a &#147;qualified
institutional                     buyer&#148; as defined in Rule 144A(a) under the
Securities Act. Such Investor                     is not a registered broker-dealer
registered under Section 15(a) of the Exchange                     Act, or a member of
the National Association of Securities Dealers, Inc. (the                     &#147;<B>NASD</b>&#148;)
or an entity engaged in the business of being a broker                     dealer. Except
as otherwise disclosed in writing to the Company on <U>Exhibit                     B-2</u> (attached
hereto) on or prior to the date of this Agreement, such                     Investor is
not affiliated with any broker dealer registered under Section 15(a)
                    of the Exchange Act, or a member of the NASD or an entity engaged in
the                     business of being a broker dealer. No investor is resident of, or
organized                     under the laws of, the State of Israel. No Investor is
resident of or organized                     under the laws of a state that either (a) is
at war with the State of Israel or                     (b) has been declared by competent
Israeli authorities as a state                     &#147;hostile&#148; to Israel.  </font>
</td>
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</table>
<br>

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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)
<U>Experience of Such Investor</u>. Such Investor, either alone or together with
                    its representatives has such knowledge, sophistication and experience
in                     business and financial matters so as to be capable of evaluating
the merits and                     risks of the prospective investment in the Securities,
and has so evaluated the                     merits and risks of such investment. Such
Investor understands that it must bear                     the economic risk of this
investment in the Securities indefinitely, and is able                     to bear such
risk and is able to afford a complete loss of such investment.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)
<U>Access to Information</u>. Such Investor acknowledges that it has reviewed
                    the Disclosure Materials and has been afforded: (i)&nbsp;the
opportunity to ask                     such questions as it has deemed necessary of, and
to receive answers from,                     representatives of the Company concerning
the terms and conditions of the                     offering of the Securities and the
merits and risks of investing in the                     Securities; (ii)&nbsp;access to
information (other than material non-public                     information) about the
Company and the Subsidiaries and their respective                     financial
condition, results of operations, business, properties, management and
                    prospects sufficient to enable it to evaluate its investment; and
(iii)&nbsp;the                     opportunity to obtain such additional information that
the Company possesses or                     can acquire without unreasonable effort or
expense that is necessary to make an                     informed investment decision
with respect to the investment. Neither such                     inquiries nor any other
investigation conducted by or on behalf of such Investor                     or its
representatives or counsel shall modify, amend or affect such                     Investor&#146;s
right to rely on the truth, accuracy and completeness of the
                    Disclosure Materials and the Company&#146;s representations and
warranties                     contained in the Transaction Documents.  </font>
</td>
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</table>
<br>

<p align=center>
<font size=2>17</font></p>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)
<U>No Governmental Review</u>. Such Investor understands that no Israeli or
                    United States federal or state agency or any other government or
governmental                     agency has passed on or made any recommendation or
endorsement of the Securities                     or the fairness or suitability of the
investment in the Securities nor have such                     authorities passed upon or
endorsed the merits of the offering of the                     Securities.  </font>
</td>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g)
<U>No Conflicts</u>. The execution, delivery and performance by such Investor of
                    this Agreement and the consummation by such Investor of the
transactions                     contemplated hereby will not (i)&nbsp;result in a
violation of the                     organizational documents of such Investor or (ii)&nbsp;conflict
with, or                     constitute a default (or an event which with notice or lapse
of time or both                     would become a default) under, or give to others any
rights of termination,                     amendment, acceleration or cancellation of,
any agreement, indenture or                     instrument to which such Investor is a
party, or (iii)&nbsp;result in a                     violation of any law, rule,
regulation, order, judgment or decree (including                     federal and state
securities laws) applicable to such Investor, except in the                     case of
clauses (ii) and (iii) above, for such that are not material and do not
                    otherwise affect the ability of such Investor to consummate the
transactions                     contemplated hereby.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h)
<U>Prohibited Transactions</u>. No Investor, directly or indirectly, and no
                    Person acting on behalf of or pursuant to any understanding with any
Investor,                     has engaged in any purchases or sales of any securities,
including any                     derivatives, of the Company (including, without
limitation, any Short Sales                     involving any of the Company&#146;s
securities) (a                     &#147;<B>Transaction</b>&#148;) since the time that
such Investor was first                     contacted by the Company, the Agents or any
other Person regarding an investment                     in the Company. Such Investor
covenants that neither it nor any Person acting on                     its behalf or
pursuant to any understanding with such Investor will engage,
                    directly or indirectly, in any Transactions prior to the Closing.
&#147;<B>Short                     Sales</b>&#148; include, without limitation, all &#147;short
sales&#148; as                     defined in Rule 200 promulgated under Regulation SHO
under the Exchange Act and                     all types of direct and indirect stock
pledges, forward sale contracts, options,                     puts, calls, short sales,
swaps, derivatives and similar arrangements (including                     on a total
return basis), and sales and other transactions through non-U.S.
                    broker-dealers or foreign regulated brokers.  </font>
</td>
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</table>
<br>

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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)
<U>Restricted Securities</u>. Such Investor understands that the Securities are
               characterized as &#147;restricted securities&#148; under the U.S. federal
               securities laws inasmuch as they are being acquired from the Company in a
               transaction not involving a public offering and that under such laws and
               applicable regulations such securities may be resold without registration
under                the Securities Act only and under Israeli securities laws in certain
limited                circumstances. Each Investor understands and acknowledges that:
(i) the                Securities are being offered and sold to it without registration
under the                Securities Act in a private placement that is exempt from the
registration                provisions of the Securities Act and (ii) the availability of
such exemption                depends in part on, and the Company will rely upon the
accuracy and truthfulness                of, the foregoing representations and such
Investor hereby consents to such                reliance.  </font>
</td>
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</table>
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<p align=center>
<font size=2>18</font></p>
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<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j)
<U>Legends</u>. It is understood that, except as provided in <U>Section
               4.1(b)</u> of this Agreement, certificates evidencing such Securities may
bear                the legend set forth in <U>Section 4.1(b).</u> </font>
</td>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(k)
<U>No Legal, Tax or Investment Advice</u>. Such Investor understands that
               nothing in this Agreement or any other materials presented by or on behalf
of                the Company to the Investor in connection with the purchase of the
Securities                constitutes legal, tax or investment advice. Such Investor has
consulted such                legal, tax and investment advisors as it, in its sole
discretion, has deemed                necessary or appropriate in connection with its
purchase of the Securities. Such                Investor understands that the Agents have
acted solely as the agent of the                Company in this placement of the
Securities, and that the Agents make no                representation or warranty with
regard to the merits of this transaction or as                to the accuracy of any
information such Investor may have received in connection                therewith. Such
Investor acknowledges that it has not relied on any information                or advice
furnished by or on behalf of the Agents.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(l)
<U>Residency</u>. The Investor&#146;s principal executive offices are in the
               jurisdiction set forth immediately below such Investor&#146;s name on the
               signature page hereto.  </font>
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<P Align="Center"><Font Face="Times New Roman, Times, Serif" Size=2>ARTICLE IV </font><Br>
<Font Face="Times New Roman, Times, Serif" Size=2>OTHER AGREEMENTS OF THE PARTIES </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1
<U>Transfer Restrictions</u>.  </font></p>


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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)
                    The Investors covenant that the Securities will only be disposed of
pursuant to                     an effective registration statement under, and in
compliance with the                     requirements of, the Securities Act or pursuant
to an available exemption from                     the registration requirements of the
Securities Act, and in compliance with any                     applicable state
securities laws and Israeli securities laws. In connection with                     any
transfer of Securities other than pursuant to an effective registration
                    statement or to the Company, or pursuant to Rule 144(k), the Company
may require                     the transferor to provide to the Company an opinion of
counsel selected by the                     transferor, the form and substance of which
opinion shall be reasonably                     satisfactory to the Company, to the
effect that such transfer does not require                     registration under the
Securities Act. Notwithstanding the foregoing, the                     Company hereby
consents to and agrees to register on the books of the Company                     and
with its Transfer Agent, without any such legal opinion, except to the
                    extent that the Transfer Agent requests such legal opinion, any
transfer of                     Securities by an Investor to an Affiliate of such
Investor; <U>provided</u>,                     that the transferee certifies to the
Company that it is an &#147;accredited                     investor&#148; as defined in
Rule 501(a) promulgated under the Securities Act                     and provided that
such Affiliate does not request any removal of any existing                     legends
on any certificate evidencing the Securities.  </font>
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<font size=2>19</font></p>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)
                    The Investors agree to the imprinting, so long as is required by this
<U>Section&nbsp;4.1(b</u>), of a legend on any certificate evidencing any of the
                    Securities substantially in the following form:  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>
THE
SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED WITH THE SECURITIES AND
EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN
EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE &#147;SECURITIES
ACT&#148;), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION
FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES
ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS AS EVIDENCED BY A LEGAL
OPINION OF COUNSEL TO THE TRANSFEROR TO SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE
REASONABLY ACCEPTABLE TO THE COMPANY. THESE SECURITIES MAY BE PLEDGED IN CONNECTION WITH
A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN SECURED BY SUCH SECURITIES.  </font></td>
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<P><Font Face="Times New Roman, Times, Serif" Size=2>Certificates evidencing the
Securities (other than the Warrants) shall not be required to contain such legend or any
other legend (i) while a registration statement (including the Registration Statement)
covering the resale of such Securities is effective under the Securities Act, (ii)
following any sale of such Securities pursuant to Rule 144 if the holder provides the
Company with a legal opinion (and the documents upon which the legal opinion is based)
reasonably acceptable to the Company to the effect that such Securities can be sold under
Rule 144, (iii) if the holder provides the Company with a legal opinion or certification
(and the documents upon which such legal opinion or certification is based) reasonably
acceptable to the Company to the effect that such Securities are eligible for sale under
Rule 144(k), or (iv) if the holder provides the Company with a legal opinion (and the
documents upon which the legal opinion is based) reasonably acceptable to the Company to
the effect that the legend is not required under applicable requirements of the Securities
Act (including controlling judicial interpretations and pronouncements issued by the Staff
of the SEC). The Company shall cause its counsel to issue the legal opinion included in
the Transfer Agent Instructions to the Transfer Agent on the Effective Date. Following the
Effective Date or at such earlier time as a legend is no longer required for certain
Securities, the Company will no later than three (3) Trading Days following the delivery
by an Investor to the Company or the Transfer Agent of (i) a legended certificate
representing such Securities and any other documentation required by this
<U>Section&nbsp;4.1(b)</u>, and (ii) an opinion of counsel to the extent required by
<U>Section 4.1(a)</u>, deliver or cause to be delivered to such Investor a certificate
representing such Securities that are free from all restrictive and other legends. The
Company may not make any notation on its records or give instructions to the Transfer
Agent that enlarge the restrictions on transfer set forth in this Section. </font></p>

<p align=center>
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<P><Font Face="Times New Roman, Times, Serif" Size=2>If within three (3) Trading Days
after the Company&#146;s receipt of a legended certificate and the other documents as
specified in Clauses (i) and (ii) of the paragraph immediately above, the Company shall
fail to issue and deliver to such Investor a certificate representing such Securities that
is free from all restrictive and other legends, and if on or after such Trading Day the
Investor purchases (in an open market transaction or otherwise) Ordinary Shares to deliver
in satisfaction of a sale by the Investor of Ordinary Shares that the Investor anticipated
receiving from the Company without any restrictive legend (the &#147;<B>Covering
Shares</b>&#148;), then the Company shall, within three (3) Trading Days after the
Investor&#146;s request, pay cash to the Investor in an amount equal to the excess (if
any) of the Investor&#146;s total purchase price (including brokerage commissions, if any)
for the Covering Shares, over the product of (A) the number of Covering Shares, times (B)
the closing bid price on the date of delivery of such certificate by the Investor and the
other documents as specified in Clauses (i) and (ii) of the paragraph immediately above.
The preceding shall apply with respect to Shares only and not with respect to any failure
by the Company to deliver a certificate representing Warrant Shares upon exercise of the
Warrant, which shall be governed by the terms of the Warrant. </font></p>

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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)
               The Company will not object to and shall permit (except as prohibited by
law) an                Investor to pledge or grant a security interest in some or all of
the Securities                in connection with a bona fide margin agreement or other
loan or financing                arrangement secured by the Securities, and if required
under the terms of such                agreement, loan or arrangement, the Company will
not object to and shall permit                (except as prohibited by law) such Investor
to transfer pledged or secured                Securities to the pledgees or secured
parties. Except as required by law, such a                pledge or transfer would not be
subject to approval of the Company, no legal                opinion of the pledgee,
secured party or pledgor shall be required in connection                therewith, and no
notice shall be required of such pledge. Each Investor                acknowledges that
the Company shall not be responsible for any pledges relating                to, or the
grant of any security interest in, any of the Securities or for any
               agreement, understanding or arrangement between any Investor and its
pledgee or                secured party. At the appropriate Investor&#146;s expense, the
Company will                execute and deliver such reasonable documentation as a
pledgee or secured party                of Securities may reasonably request in
connection with a pledge or transfer of                the Securities, including the
preparation and filing of any required prospectus                supplement under Rule
424(b)(3) of the Securities Act or other applicable                provision of the
Securities Act to appropriately amend the list of Selling                Stockholders
thereunder. Provided that the Company is in compliance with the                terms of
this <U>Section 4.1(c)</u>, the Company&#146;s indemnification                obligations
pursuant to <U>Section 6.4 </u> shall not extend to any Proceeding                or
Losses arising out of or related to this <U>Section 4.1(c)</u>.  </font>
</td>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)
               Each Investor agrees that the removal of the restrictive legend from
               certificates representing Securities as set forth in this <U>Section 4.1</u> is
               predicated upon the Company&#146;s reliance that the Investor will sell
any                Securities pursuant to either the registration requirements of the
Securities                Act, including any applicable prospectus delivery requirements,
or an exemption                therefrom, and that if Securities are sold pursuant to a
Registration Statement,                they will be sold in compliance with the plan of
distribution set forth therein.                Both the Company and its transfer agent,
and their respective directors,                officers, employees and agents, may rely
on this <U>Section 4.1(d)</u>.  </font>
</td>
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<br>

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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)
               At the Company&#146;s discretion, the Company, may, by written notice,
require                the Investors to deliver legended share certificates and/or other
related                documentation and/or may require the Investors to furnish the
Warrant exercise                notices and/or other related documentation, directly to
the Transfer Agent (with                a copy to the Company).  </font>
</td>
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<p align=center>
<font size=2>21</font></p>
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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.2
<U>Furnishing of Information</u>. Until the date that any Investor owning Shares or
Warrant Shares (or Warrants exercisable for Warrant Shares) may sell the Shares and the
Warrant Shares under Rule 144(k) of the Securities Act (or any successor provision), the
Company covenants to use its commercially reasonable efforts to timely file (or obtain
extensions in respect thereof and file within the applicable grace period) all reports
required to be filed by the Company after the date hereof pursuant to the Exchange Act.
The Company further covenants that it will take such further action as any holder of
Securities may reasonably request to satisfy the provisions of this <U>Section 4.2</u>.  </font></p>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.3
<U>Integration</u>. The Company shall not, and shall use its commercially reasonably
efforts to ensure that no Affiliate thereof shall, sell, offer for sale or solicit offers
to buy or otherwise negotiate in respect of any security (as defined in Section&nbsp;2 of
the Securities Act) that would be integrated with the offer or sale of the Securities in
a manner that would require the registration under the Securities Act of the sale of the
Securities to the Investors or that would be integrated with the offer or sale of the
Securities for purposes of the rules and regulations of any Trading Market.  </font></p>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.4
<U>Reservation of Securities</u>. The Company shall maintain a reserve from its duly
authorized Ordinary Shares for issuance pursuant to the Transaction Documents in such
amount as may be required to fulfill its obligations to issue all Shares and Warrant
Shares under the Transaction Documents. In the event that at any time the then authorized
Ordinary Shares are insufficient for the Company to satisfy its obligations to issue such
Shares and Warrant Shares under the Transaction Documents, the Company shall promptly
take such actions as may be required to increase the number of authorized Ordinary
Shares.  </font></p>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.5
<U>Securities Laws Disclosure; Publicity</u>. The Company shall, on or before 8:30 a.m.,
Eastern time, on the first Trading Day following execution of this Agreement, issue a
press release reasonably acceptable to the Investors disclosing all material terms of the
transactions contemplated hereby. On the Closing Date, the Company shall file a Current
Report on Form 6-K with the SEC (the &#147;<B>6-K Filing</b>&#148;) describing the terms
of the transactions contemplated by the Transaction Documents and including as exhibits
to such Current Report on Form 6-K the Transaction Documents (including the schedules and
the names of the Investors and the amount(s) of Securities respectively purchased) and
the form of Warrant, in the form required by the Exchange Act. Thereafter, the Company
shall timely file any filings and notices required by the SEC or applicable law or
regulation with respect to the transactions contemplated hereby and provide copies
thereof to the Investors promptly after filing. Except as herein provided, the Company
shall not publicly disclose the name of any Investor, or include the name of any Investor
in any press release without the prior written consent of such Investor, unless otherwise
required by law or governmental or regulatory authority, or in the Registration
Statement. The Company shall not, and shall cause each of its Subsidiaries and its and
each of their respective officers, directors, employees and agents not to, provide any
Investor with any material nonpublic information regarding the Company or any of its
Subsidiaries from and after the issuance of the above referenced press release without
the express written consent of such Investor.  </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.6
<U>Use of Proceeds</u>. The Company intends to use the net proceeds from the sale of the
Securities for working capital and general corporate purposes. The Company also may use a
portion of the net proceeds, currently intended for general corporate purposes, to
acquire or invest in technologies, products, services or companies that complement its
business, although the Company has no present plans or commitments and is not currently
engaged in any material negotiations with respect to these types of transactions. Pending
these uses, the Company intends to invest the net proceeds from this offering in
short-term, interest-bearing, investment-grade securities, or as otherwise pursuant to
the Company&#146;s customary investment policies.  </font></p>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.7
<U>OCS Undertakings</u>. Each Investor hereby agrees to execute an undertaking to the
Israeli Office of the Chief Scientist, in customary form, if, at or following the
Closing, such Investor shall hold 5% or more of the issued and outstanding Ordinary
Shares of the Company.  </font></p>


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<P Align="Center"><Font Face="Times New Roman, Times, Serif" Size=2>ARTICLE V </font><Br>
<Font Face="Times New Roman, Times, Serif" Size=2>CONDITIONS </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.1
<U>Conditions Precedent to the Obligations of the Investors</u>. The obligation of each
Investor to acquire Securities at the Closing is subject to the satisfaction or waiver by
such Investor, at or before the Closing, of each of the following conditions:  </font></p>


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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)
<U>Representations and Warranties</u>. The representations and warranties of the
                    Company contained herein shall be true and correct in all material
respects as                     of the date when made and as of the Closing as though
made on and as of such                     date; and  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)
<U>Performance</u>. The Company shall have performed, satisfied and complied in
                    all material respects with all covenants, agreements and conditions
required by                     the Transaction Documents to be performed, satisfied or
complied with by it at                     or prior to the Closing, including, but not
limited to, the delivery of the                     items set forth in <U>Section&nbsp;2.2(a)</u>.  </font>
</td>
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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.2
<U>Conditions Precedent to the Obligations of the Company</u>. The obligation of the
Company to sell the Securities at the Closing is subject to the satisfaction or waiver by
the Company, at or before the Closing, of each of the following conditions:  </font></p>


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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)
<U>Representations and Warranties</u>. The representations and warranties of the
                    Investors contained herein shall be true and correct in all material
respects as                     of the date when made and as of the Closing Date as
though made on and as of                     such date; and  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)
<U>Performance</u>. The Investors shall have performed, satisfied and complied
                    in all material respects with all covenants, agreements and
conditions required                     by the Transaction Documents to be performed,
satisfied or complied with by the                     Investors at or prior to the
Closing.  </font>
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<P Align="Center"><Font Face="Times New Roman, Times, Serif" Size=2>ARTICLE VI </font><Br>
<Font Face="Times New Roman, Times, Serif" Size=2>REGISTRATION RIGHTS </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1
<U>Registration Statement</u>.  </font></p>


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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)
                    As promptly as possible, and in any event on or prior to the Filing
Date, the                     Company shall prepare and file with the SEC a Registration
Statement covering                     the resale of all Registrable Securities for an
offering to be made on a                     continuous basis pursuant to Rule 415. The
Registration Statement shall be on                     Form F-3 (except if the Company is
not then eligible to register for resale the                     Registrable Securities
on Form F-3, in which case such registration shall be on                     another
appropriate form in accordance with the Securities Act and the Exchange
                    Act) and shall contain (except if otherwise directed by the Investors
or                     requested by the SEC) a &#147;Plan of Distribution&#148; in
substantially the                     form attached hereto as <U>Exhibit&nbsp;D</u>.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)
                    The Company shall use its commercially reasonable efforts to cause
the                     Registration Statement to be declared effective by the SEC as
promptly as                     possible after the filing thereof, but in any event prior
to the Required                     Effectiveness Date, and shall use its commercially
reasonable efforts to keep                     the Registration Statement continuously
effective under the Securities Act until                     the earlier of the date that
all Registrable Securities covered by such                     Registration Statement
have been sold or can be sold publicly under Rule 144(k)                     (the <B>&#147;Effectiveness
 Period</b>&#148;); <U>provided</u>, that upon                     notification by the
SEC that a Registration Statement will not be reviewed or is                     no
longer subject to further review and comments, provided that in the opinion
                    of Company Counsel no pre-effective amendment is required under the
Securities                     Act, the Company shall request that the effectiveness of
the Registration                     Statement be accelerated to no later than 4:00 p.m.
Eastern Time on the fifth                     Trading Day after the Company&#146;s
receipt of such notification and file a                     prospectus supplement for any
Registration Statement, whether or not required                     under Rule 424 (or
otherwise), by 9:00 a.m. Eastern time within three (3)                     Business Days
after the Effective Date.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)
                    The Company shall notify the Investors in writing promptly (and in
any event                     within two (2) Trading Days) after receiving notification
from the SEC that the                     Registration Statement has been declared
effective.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)
                    Should an Event (as defined below) occur, then upon the occurrence of
such                     Event, and on every monthly anniversary thereof until the
applicable Event is                     cured, the Company shall pay to each Investor
entitled to be included in the                     Registration Statement an amount in
cash, as liquidated damages and not as a                     penalty, equal to one
percent (1.0%) of (i) the number of Registrable Securities                     held by
such Investor as of the date of such Event, multiplied by (ii) the
                    purchase price paid by such Investor for such Registrable Securities
then held; <U>provided</u>, <U>however</u>, that the total amount of payments pursuant to
                    this <U>Section&nbsp;6.1(d)</u> shall not exceed, when aggregated
with all such                     payments paid to all Investors, ten percent (10%) of
the aggregate purchase                     price. The payments to which an Investor shall
be entitled pursuant to this <U>Section&nbsp;6.1(d</u>) are referred to herein as &#147;<B>Event
                    Payments.</b>&#148; Any Event Payments payable pursuant to the terms
hereof                     shall apply on a pro rated basis for any portion of a month
prior to the cure of                     an Event. All pro rated calculations made
pursuant to this paragraph shall be                     based upon the actual number of
days in such pro rated month.  </font>
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<P><Font Face="Times New Roman, Times, Serif" Size=2>For such purposes, each of the
following shall constitute an &#147;<B>Event</b>&#148;: </font></p>

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<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)
                    the Registration Statement is not filed on or prior to the Filing
Date or is not                     declared effective on or prior to the Required
Effectiveness Date;  </font>
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<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)
                    except as provided for in <U>Section 6.1(e</u>) (the &#147;<B>Excluded
                    Events</b>&#148;), after the Effective Date, an Investor is not
permitted to                     sell Registrable Securities under the Registration
Statement (or a subsequent                     Registration Statement filed in
replacement thereof) for any reason (other than                     the fault of such
Investor) for ten (10) or more consecutive Trading Days or                     thirty
(30) Trading Days (whether or not consecutive) in any twelve (12) month
                    period;  </font>
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<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)
                    except as a result of the Excluded Events, the Ordinary Shares are
not listed or                     quoted, or are suspended from trading, on the Trading
Market or an Eligible                     Market for a period of three (3) Trading Days
(which need not be consecutive                     Trading Days) during the Effectiveness
Period; or  </font>
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<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv)
                    during the Effectiveness Period, except as a result of the Excluded
Events, the                     Company fails to have any Shares listed on the Trading
Market or an Eligible                     Market.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)
                    Notwithstanding anything in this Agreement to the contrary, after
sixty (60)                     consecutive Trading Days of continuous effectiveness of
the initial Registration                     Statement filed and declared effective
pursuant to this Agreement, the Company                     may, by written notice to the
Investors, suspend sales under a Registration                     Statement after the
Effective Date thereof and/or require that the Investors                     immediately
cease the sale of shares of Ordinary Shares pursuant thereto and/or
                    defer the filing of any subsequent Registration Statement if the
Company is                     engaged in a material merger, acquisition or sale and the
Board of Directors                     determines in good faith, by appropriate
resolutions, that, as a result of such                     activity, (A)&nbsp;it would be
materially detrimental to the Company (other than                     as relating solely
to the price of the Ordinary Shares) to maintain<B></b>a                     Registration
Statement at such time or (B)&nbsp;it is in the best interests of                     the
Company to suspend sales under such registration at such time. Upon receipt
                    of such notice, each Investor shall immediately discontinue any sales
of                     Registrable Securities pursuant to such registration until such
Investor is                     advised in writing by the Company that the current
Prospectus or amended                     Prospectus, as applicable, may be used. In no
event, however, shall this right                     be exercised to suspend sales beyond
the period during which (in the good faith                     determination of the
Company&#146;s Board of Directors) the failure to require                     such
suspension would be materially detrimental to the Company. The                     Company&#146;s
rights under this <U>Section 6.1(e) </u> may be exercised for a
                    period of no more than twenty (20) Trading Days at a time and not
more than                     three (3) times in any twelve (12) month period, without
such suspension being                     considered as part of an Event Payment
determination. Immediately after the end                     of any suspension period
under this <U>Section 6.1(e)</u>, the Company shall                     take all
necessary actions (including filing any required supplemental
                    prospectus) to restore the effectiveness of the applicable
Registration                     Statement and the ability of the Investors to publicly
resell their Registrable                     Securities pursuant to such effective
Registration Statement.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)
                    The Company shall not, from the date hereof until the Effective Date
of the                     Registration Statement, prepare and file with the SEC a
registration statement                     relating to an offering for its own account or
the account of others under the                     Securities Act of any of its equity
securities, other than any registration                     statement or post-effective
amendment to a registration statement (or supplement                     thereto)
relating to the Company&#146;s employee benefit plans registered on
                    Form S-8.  </font>
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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.2
     <U>Registration  Procedures</u>.  In connection with the Company's  registration
 obligations hereunder, the Company shall:  </font></p>


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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)
                    Not less than three (3) Trading Days prior to the filing of a
Registration                     Statement or any related Prospectus or any amendment or
supplement thereto,                     furnish via email to those Investors who have
supplied the Company with email                     addresses copies of all such
documents proposed to be filed, which documents                     (other than any
document that is incorporated or deemed to be incorporated by
                    reference therein) will be subject to the review of such Investors.
The Company                     shall reflect in each such document when so filed with
the SEC such comments                     regarding the Investors and the plan of
distribution as the Investors may                     reasonably and promptly propose no
later than two (2) Trading Days after the                     Investors have been so
furnished with copies of such documents as aforesaid.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)
                    (i)&nbsp;Subject to <U>Section 6.1(e)</u>, prepare and file with the
SEC such                     amendments, including post-effective amendments, to each
Registration Statement                     and the Prospectus used in connection
therewith as may be necessary to keep the                     Registration Statement
continuously effective, as to the applicable Registrable                     Securities
for the Effectiveness Period and prepare and file with the SEC such
                    additional Registration Statements in order to register for resale
under the                     Securities Act all of the Registrable Securities; (ii)&nbsp;cause
the related                     Prospectus to be amended or supplemented by any required
Prospectus supplement,                     and as so supplemented or amended to be filed
pursuant to Rule 424;                     (iii)&nbsp;respond as promptly as reasonably
possible, and in any event within                     twelve (12) Trading Days (except to
the extent that the Company reasonably                     requires additional time to
respond to accounting comments), to any comments                     received from the
SEC with respect to the Registration Statement or any                     amendment
thereto; and (iv)&nbsp;comply in all material respects with the
                    provisions of the Securities Act and the Exchange Act with respect to
the                     disposition of all Registrable Securities covered by the
Registration Statement                     during the applicable period in accordance
with the intended methods of                     disposition by the Investors thereof set
forth in the Registration Statement as                     so amended or in such
Prospectus as so supplemented.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)
                    Notify the Investors as promptly as reasonably possible, and (if
requested by                     the Investors confirm such notice in writing no later
than two (2) Trading Days                     thereafter, of any of the following events:
(i)&nbsp;the SEC notifies the                     Company whether there will be a &#147;review&#148; of
any Registration                     Statement; (ii)&nbsp;the SEC comments in writing on
any Registration Statement;                     (iii)&nbsp;any Registration Statement or
any post-effective amendment is                     declared effective; (iv)&nbsp;the SEC
or any other Federal or state governmental                     authority requests any
amendment or supplement to any Registration Statement or                     Prospectus
or requests additional information related thereto; (v)&nbsp;the SEC
                    issues any stop order suspending the effectiveness of any
Registration Statement                     or initiates any Proceedings for that purpose;
(vi)&nbsp;the Company receives                     notice of any suspension of the
qualification or exemption from qualification of                     any Registrable
Securities for sale in any jurisdiction, or the initiation or                     threat
of any Proceeding for such purpose; or (vii)&nbsp;the financial
                    statements included in any Registration Statement become ineligible
for                     inclusion therein or any Registration Statement or Prospectus or
other document                     contains any untrue statement of a material fact or
omits to state any material                     fact required to be stated therein or
necessary to make the statements therein,                     in the light of the
circumstances under which they were made, not misleading.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)
                    Use its reasonable Best Efforts to avoid the issuance of or, if
issued, obtain                     the withdrawal of (i)&nbsp;any order suspending the
effectiveness of any                     Registration Statement, or (ii)&nbsp;any
suspension of the qualification (or                     exemption from qualification) of
any of the Registrable Securities for sale in                     any jurisdiction, as
soon as possible.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)
                    If requested by an Investor, provide such Investor and its counsel,
without                     charge, at least one conformed copy of each Registration
Statement and each                     amendment thereto, including financial statements
and schedules, and all                     exhibits to the extent requested by such
Person (including those previously                     furnished or incorporated by
reference) promptly after the filing of such                     documents with the SEC.  </font>
</td>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)
                    Promptly deliver to each Investor, without charge, as many copies of
the                     Prospectus or Prospectuses (including each form of prospectus)
and each                     amendment or supplement thereto as such Persons may
reasonably request. The                     Company hereby consents to the use of such
Prospectus and each amendment or                     supplement thereto by each of the
selling Investors in connection with the                     offering and sale of the
Registrable Securities covered by such Prospectus and                     any amendment
or supplement thereto to the extent permitted by federal and state
                    securities laws and regulations.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g)
                    (i)&nbsp;In the time and manner required by each Trading Market,
prepare and                     file with such Trading Market an additional shares
listing application covering                     all of the Registrable Securities; (ii)&nbsp;take
all steps necessary to cause                     such Registrable Securities to be
approved for listing on each Trading Market as                     soon as possible
thereafter; (iii)&nbsp;provide to the Investors and their                     counsel
evidence of such listing, upon reasonable request; and (iv)&nbsp;except
                    as a result of the Excluded Events, during the Effectiveness Period,
maintain                     the listing of such Registrable Securities on each such
Trading Market or                     another Eligible Market.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h)
                    Prior to any public offering of Registrable Securities, use its
reasonable Best                     Efforts to register or qualify or cooperate with the
selling Investors in                     connection with the registration or
qualification (or exemption from such                     registration or qualification)
of such Registrable Securities for offer and sale                     under the
securities or Blue Sky laws of such jurisdictions within the United
                    States as any Investor requests in writing, to keep each such
registration or                     qualification (or exemption therefrom) effective for
so long as required, but                     not to exceed the duration of the
Effectiveness Period, and to do any and all                     other acts or things
reasonably necessary or advisable to enable the disposition                     in such
jurisdictions of the Registrable Securities covered by a Registration
                    Statement; <U>provided</u>, <U>however</u>, that the Company shall
not be                     obligated to file any general consent to service of process or
to qualify as a                     foreign corporation or as a dealer in securities in
any jurisdiction in which it                     is not so qualified or to subject itself
to taxation in respect of doing                     business in any jurisdiction in which
it is not otherwise so subject.  </font>
</td>
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</table>
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<font size=2>27</font></p>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)
                    Cooperate with the Investors to facilitate the timely preparation and
delivery                     of certificates representing Registrable Securities to be
delivered to a                     transferee pursuant to a Registration Statement, which
certificates shall be                     free, to the extent permitted by this Agreement
and under law, of all                     restrictive legends, and to enable such
Registrable Securities to be in such                     denominations and registered in
such names as any such Investors may reasonably                     request.  </font>
</td>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j)
                    Upon the occurrence of any event described in <U>Section&nbsp;6.2(c)(vii</u>),
                    as promptly as reasonably possible, prepare a supplement or
amendment, including                     a post-effective amendment, to the Registration
Statement or a supplement to the                     related Prospectus or any document
incorporated or deemed to be incorporated                     therein by reference, and
file any other required document so that, as                     thereafter delivered,
neither the Registration Statement nor such Prospectus                     will contain
an untrue statement of a material fact or omit to state a material
                    fact required to be stated therein or necessary to make the
statements therein,                     in the light of the circumstances under which
they were made, not misleading.  </font>
</td>
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</table>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(k)
                    Cooperate with any reasonable due diligence investigation undertaken
by the                     Investors in connection with the sale of Registrable
Securities, including,                     without limitation, by making available
documents and information; <U>provided</u>, that the Company will not deliver or make
available to any                     Investor material, nonpublic information unless such
Investor requests in                     advance in writing to receive material,
nonpublic information and agrees to keep                     such information
confidential.  </font>
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</table>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(l)
                    Comply with all rules and regulations of the SEC applicable to the
registration                     of the Securities.  </font>
</td>
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</table>
<br>

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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(m)
                    It shall be a condition precedent to the obligations of the Company
to complete                     the registration pursuant to this Agreement with respect
to the Registrable                     Securities of any particular Investor or to make
any Event Payments set forth in <U>Section 6.1(c)</u> to such Investor that such Investor
furnish to the Company                     the information specified in <U>Exhibits B-1</u>,
<U>B-2</u> and <U>B-3</u> hereto and                     such other information regarding
itself, the Registrable Securities and other                     Ordinary Shares or other
securities of the Company held by it and the intended                     method of
disposition of the Registrable Securities held by it (if different
                    from the Plan of Distribution set forth on <U>Exhibit D</u> hereto)
as shall be                     reasonably required to effect the registration of such
Registrable Securities                     and shall complete and execute such documents
in connection with such                     registration as the Company may reasonably
request.  </font>
</td>
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</table>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(n)
                    The Company shall comply with all applicable rules and regulations of
the SEC                     under the Securities Act and the Exchange Act, including,
without limitation,                     Rule 172 under the Securities Act, file any final
Prospectus, including any                     supplement or amendment thereof, with the
SEC pursuant to Rule 424 under the                     Securities Act, promptly inform
the Investors in writing if, at any time during                     the Effectiveness
Period, the Company does not satisfy the conditions specified                     in Rule
172 and, as a result thereof, the Investors are required to make
                    available a Prospectus in connection with any disposition of
Registrable                     Securities and take such other actions as may be
reasonably necessary to                     facilitate the registration of the
Registrable Securities hereunder.  </font>
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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.3
<U>Registration Expenses</u>. The Company shall pay all fees and expenses incident to the
performance of or compliance with Article&nbsp;VI of this Agreement by the Company,
including without limitation (a)&nbsp;all registration and filing fees and expenses,
including without limitation those related to filings with the SEC, any Trading Market
and in connection with applicable state securities or Blue Sky laws, (b)&nbsp;printing
expenses (including without limitation expenses of printing certificates for Registrable
Securities), (c)&nbsp;messenger, telephone and delivery expenses, (d)&nbsp;fees and
disbursements of counsel for the Company, (e) fees and expenses of all other Persons
retained by the Company in connection with the consummation of the transactions
contemplated by this Agreement, and (f)&nbsp;all listing fees to be paid by the Company
to the Trading Market.  </font></p>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.4
<U>Indemnification</u>.  </font></p>


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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)
<U>Indemnification by the Company</u>. The Company shall, notwithstanding any
                    termination of this Agreement, indemnify and hold harmless each
Investor, the                     officers, directors, partners, members, agents and
employees of each of them,                     each Person who controls any such Investor
(within the meaning of                     Section&nbsp;15 of the Securities Act or
Section&nbsp;20 of the Exchange Act)                     and the officers, directors,
partners, members, agents and employees of each                     such controlling
Person, to the fullest extent permitted by applicable law, from                     and
against any and all Losses, as incurred, arising out of or relating to (i)
                    any misrepresentation or breach of any representation or warranty
made by the                     Company in the Transaction Documents or any other
certificate, instrument or                     document contemplated hereby or thereby,
(ii) any breach of any covenant,                     agreement or obligation of the
Company contained in the Transaction Documents or                     any other
certificate, instrument or document contemplated hereby or thereby,
                    (iii) any cause of action, suit or claim brought or made against such
                    Indemnified Party (as defined in <U>Section </u><U>6.4(c)</u> below)
by a third                     party (including for these purposes a derivative action
brought on behalf of the                     Company), arising out of or resulting from
(x) execution, delivery, performance                     or enforcement of the
Transaction Documents or any other certificate, instrument                     or
document contemplated hereby or thereby, (y) any transaction financed or to
                    be financed in whole or in part, directly or indirectly, with the
proceeds of                     the issuance of the Securities, or (z) the status of
Indemnified Party as holder                     of the Securities (unless such action is
primarily based, including in part,                     upon a breach of such Investor&#146;s
representations, warranties or covenants                     under the Transaction
Documents or any conduct by such Investor which                     constitutes fraud,
gross negligence or willful misconduct) or (iv) any untrue or                     alleged
untrue statement of a material fact contained in the Registration
                    Statement, any Prospectus or any form of Company prospectus or in any
amendment                     or supplement thereto or in any Company preliminary
prospectus, or arising out                     of or relating to any omission or alleged
omission of a material fact required                     to be stated therein or
necessary to make the statements therein (in the case of                     any
Prospectus or form of prospectus or supplement thereto, in the light of the
                    circumstances under which they were made) not misleading, except to
the extent,                     but only to the extent, that (A)&nbsp;such untrue
statements, alleged untrue                     statements, omissions or alleged omissions
are based solely upon information                     regarding such Investor furnished
in writing to the Company by such Investor for                     use therein, or to the
extent that such information relates to such Investor or                     such Investor&#146;s
proposed method of distribution of Registrable Securities                     and was
reviewed and expressly approved by such Investor or counsel to the
                    Investor expressly for use in the Registration Statement, or (B) with
respect to                     any prospectus, if the untrue statement or omission of
material fact contained                     in such prospectus was corrected on a timely
basis in the prospectus, as then                     amended or supplemented, if such
corrected prospectus was timely made available                     by the Company to the
Investor, and the Investor seeking indemnity hereunder was                     advised in
writing not to use the incorrect prospectus prior to the use giving
                    rise to Losses.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)
<U>Indemnification by Investors</u>. Each Investor shall, severally and not
                    jointly, indemnify and hold harmless the Company, its directors,
officers,                     agents and employees, each Person who controls the Company
(within the meaning                     of Section&nbsp;15 of the Securities Act and
Section&nbsp;20 of the Exchange                     Act), and the directors, officers,
agents or employees of such controlling                     Persons, to the fullest
extent permitted by applicable law, from and against all                     Losses (as
determined by a court of competent jurisdiction in a final judgment
                    not subject to appeal or review) arising solely out of any untrue
statement of a                     material fact contained in the Registration Statement,
any Prospectus, or any                     form of prospectus, or in any amendment or
supplement thereto, or arising out of                     or relating to any omission of
a material fact required to be stated therein or                     necessary to make
the statements therein (in the case of any Prospectus or form                     of
prospectus or supplement thereto, in the light of the circumstances under
                    which they were made) not misleading, but only to the extent that
such untrue                     statement or omission is contained in any information so
furnished by such                     Investor in writing to the Company specifically for
inclusion in such                     Registration Statement or such Prospectus or to the
extent that (i)&nbsp;such                     untrue statements or omissions are based
solely upon information regarding such                     Investor furnished to the
Company by such Investor in writing expressly for use                     therein, or to
the extent that such information relates to such Investor or such
                    Investor&#146;s proposed method of distribution of Registrable
Securities and                     was reviewed and expressly approved by such Investor
or its counsel expressly                     for use in the Registration Statement (it
being understood that the information                     provided by the Investor to the
Company in <U>Exhibits B-1</u>, <U>B-2</u> and <U>B-3</u> and the Plan of Distribution
set forth on <U>Exhibit D</u>, as the                     same may be modified by such
Investor pursuant hereto and other information                     provided by the
Investor to the Company in or pursuant to the Transaction                     Documents
constitutes information reviewed and expressly approved by such
                    Investor or its counsel in writing expressly for use in the
Registration                     Statement), such Prospectus or such form of Prospectus
or in any amendment or                     supplement thereto. In no event shall the
liability of any selling Investor                     hereunder be greater in amount than
the dollar amount of the net proceeds                     received by such Investor upon
the sale of the Registrable Securities giving                     rise to such
indemnification obligation.  </font>
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</table>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)
<U>Conduct of Indemnification Proceedings</u>. If any Proceeding shall be
                    brought or asserted against any Person entitled to indemnity
hereunder (an                     &#147;<B>Indemnified Party</b>&#148;), such Indemnified
Party shall promptly                     notify the Person from whom indemnity is sought
(the &#147;<B>Indemnifying                     Party</b>&#148;) in writing, and the
Indemnifying Party shall assume the defense                     thereof, including the
employment of counsel reasonably satisfactory to the                     Indemnified
Party and the payment of all fees and expenses incurred in                     connection
with defense thereof; <U>provided</u>, that the failure of any
                    Indemnified Party to give such notice shall not relieve the
Indemnifying Party                     of its obligations or liabilities pursuant to this
Agreement, except (and only)                     to the extent that it shall be finally
determined by a court of competent                     jurisdiction (which determination
is not subject to appeal or further review)                     that such failure shall
have proximately and materially adversely prejudiced the                     Indemnifying
Party.  </font>
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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;An
Indemnified Party shall have the right to employ separate counsel in any such Proceeding
and to participate in the defense thereof, but the fees and expenses of such counsel shall
be at the expense of such Indemnified Party or Parties unless: (i)&nbsp;the Indemnifying
Party has agreed in writing to pay such fees and expenses; or (ii)&nbsp;the Indemnifying
Party shall have failed promptly to assume the defense of such Proceeding and to employ
counsel reasonably satisfactory to such Indemnified Party in any such Proceeding; or
(iii)&nbsp;the named parties to any such Proceeding (including any impleaded parties)
include both such Indemnified Party and the Indemnifying Party, and such Indemnified Party
shall have been advised by counsel that a conflict of interest is likely to exist if the
same counsel were to represent such Indemnified Party and the Indemnifying Party (in which
case, if such Indemnified Party notifies the Indemnifying Party in writing that it elects
to employ separate counsel at the expense of the Indemnifying Party, the Indemnifying
Party shall not have the right to assume the defense thereof and the reasonable fees and
expenses of separate counsel shall be at the expense of the Indemnifying Party). It being
understood, however, that the Indemnifying Party shall not, in connection with any one
such Proceeding (including separate Proceedings that have been or will be consolidated
before a single judge) be liable for the fees and expenses of more than one separate firm
of attorneys at any time for all Indemnified Parties, which firm shall be appointed by a
majority of the Indemnified Parties. The Indemnifying Party shall not be liable for any
settlement of any such Proceeding effected without its written consent, which consent
shall not be unreasonably withheld or delayed. No Indemnifying Party shall, without the
prior written consent of the Indemnified Party, effect any settlement of any pending
Proceeding in respect of which any Indemnified Party is a party, unless such settlement
includes an unconditional release of such Indemnified Party from all liability on claims
that are the subject matter of such Proceeding. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;All
reasonable fees and expenses of the Indemnified Party (including reasonable fees and
expenses to the extent incurred in connection with investigating or preparing to defend
such Proceeding in a manner not inconsistent with this <U>Section</u>) shall be paid to
the Indemnified Party, as incurred, within twenty (20) Trading Days of written notice
thereof to the Indemnifying Party (regardless of whether it is ultimately determined that
an Indemnified Party is not entitled to indemnification hereunder; provided, that the
Indemnifying Party may require such Indemnified Party to undertake to reimburse all such
fees and expenses to the extent it is finally judicially determined that such Indemnified
Party is not entitled to indemnification hereunder). </font></p>

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<font size=2>31</font></p>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)
<U>Contribution</u>. If a claim for indemnification under <U>Section 6.4(a)</u>, <U>(b)</u>
or <U>(c)</u> is unavailable to an Indemnified Party (by reason of
                    public policy or otherwise), then each Indemnifying Party, in lieu of
                    indemnifying such Indemnified Party, shall contribute to the amount
paid or                     payable by such Indemnified Party as a result of such Losses,
in such proportion                     as is appropriate to reflect the relative fault of
the Indemnifying Party and                     Indemnified Party in connection with the
actions, statements or omissions that                     resulted in such Losses as well
as any other relevant equitable considerations.                     The relative fault of
such Indemnifying Party and Indemnified Party shall be                     determined by
reference to, among other things, whether any action in question,
                    including any untrue or alleged untrue statement of a material fact
or omission                     or alleged omission of a material fact, has been taken or
made by, or relates to                     information supplied by, such Indemnifying
Party or Indemnified Party, and the                     parties&#146; relative intent,
knowledge, access to information and opportunity                     to correct or
prevent such action, statement or omission. The amount paid or
                    payable by a party as a result of any Losses shall be deemed to
include, subject                     to the limitations set forth in <U>Section 6.4(c</u>),
any reasonable                     attorneys&#146; or other reasonable fees or expenses
incurred by such party in                     connection with any Proceeding to the
extent such party would have been                     indemnified for such fees or
expenses if the indemnification provided for in                     this <U>Section</u> was
available to such party in accordance with its terms.  </font>
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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
parties hereto agree that it would not be just and equitable if contribution pursuant to
this <U>Section 6.4(d</u>) were determined by pro rata allocation or by any other method
of allocation that does not take into account the equitable considerations referred to in
the immediately preceding paragraph. Notwithstanding the provisions of this <U>Section
6.4(d</u>), no Investor shall be required to contribute, in the aggregate, any amount in
excess of the amount by which the proceeds actually received by such Investor from the
sale of the Registrable Securities subject to the Proceeding exceeds the amount of any
damages that such Investor has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. No Person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be
entitled to contribution from any Person who was not guilty of such fraudulent
misrepresentation. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
indemnity and contribution agreements contained in this <U>Section</u> &nbsp;are in
addition to any liability that the Indemnifying Parties may have to the Indemnified
Parties. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.5
<U>Dispositions</u>. Each Investor agrees that it will comply with the prospectus
delivery requirements of the Securities Act as applicable to it in connection with sales
of Registrable Securities pursuant to the Registration Statement and shall sell its
Registrable Securities in accordance with the Plan of Distribution set forth in the
Prospectus. Each Investor further agrees that, upon receipt of a notice from the Company
of the occurrence of any event of the kind described in <U>Sections 6.2(c)(v</u>), <U>(vi</u>)
or <U>(vii</u>), such Investor will discontinue disposition of such Registrable
Securities under the Registration Statement until such Investor is advised in writing by
the Company that the use of the Prospectus, or amended Prospectus, as applicable, may be
used. The Company may provide appropriate stop orders to enforce the provisions of this
paragraph.  </font></p>


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<td><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.6
<U>No Piggyback on Registrations</u>. Neither the Company nor any of its security holders
(other than the Investors in such capacity pursuant hereto, third party investors who
purchased securities of the Company similar to the Securities on or about the Closing
Date and the Agents for any placement agent warrants issued as compensation for this
offering) may include securities of the Company in the Registration Statement other than
the Registrable Securities.  </font>
</td>
</tr>
</table>
<br>

<p align=center>
<font size=2>32</font></p>
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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.7
<U>Piggy-Back Registrations</u>. If at any time during the Effectiveness Period there is
not an effective Registration Statement covering all of the Registrable Securities and
the Company shall determine to prepare and file with the SEC a registration statement
relating to an offering for its own account or the account of others under the Securities
Act of any of its equity securities, other than on Form F-4 or Form S-8 (each as
promulgated under the Securities Act) or their then equivalents relating to equity
securities to be issued solely in connection with any acquisition of any entity or
business or equity securities issuable in connection with stock option or other employee
benefit plans, then the Company shall send to each Investor not then eligible to sell all
of their Registrable Securities under Rule 144 in a three (3) month period, written
notice of such determination and if, within ten (10) days after receipt of such notice,
any such Investor shall so request in writing, the Company shall include in such
registration statement all or any part of such Registrable Securities such Investor
requests to be registered. Notwithstanding the foregoing, in the event that, in
connection with any underwritten public offering, the managing underwriter(s) thereof
shall impose a limitation on the number of Ordinary Shares which may be included in the
Registration Statement because, in such underwriter(s)&#146; judgment, marketing or other
factors dictate such limitation is necessary to facilitate public distribution, then the
Company shall be obligated to include in such Registration Statement only such limited
portion of the Registrable Securities with respect to which such Investor has requested
inclusion hereunder as the underwriter shall permit; <U>provided<I></i></u><I>,</i><U>however</u>,
that (i) the Company shall not exclude any Registrable Securities unless the Company has
first excluded all outstanding securities, the holders of which are not contractually
entitled to inclusion of such securities in such Registration Statement or are not
contractually entitled to pro rata inclusion with the Registrable Securities and (ii)
after giving effect to the immediately preceding proviso, any such exclusion of
Registrable Securities shall be made pro rata among the Investors seeking to include
Registrable Securities and the holders of other securities having the contractual right
to inclusion of their securities in such Registration Statement, in proportion to the
number of Registrable Securities or other securities, as applicable, sought to be
included by each such Investor or other holder. If an offering in connection with which
an Investor is entitled to registration under this <U>Section 6.7 </u>is an underwritten
offering, then each Investor whose Registrable Securities are included in such
Registration Statement shall, unless otherwise agreed by the Company, offer and sell such
Registrable Securities in an underwritten offering using the same underwriter or
underwriters and, subject to the provisions of this Agreement, on the same terms and
conditions as other Ordinary Shares included in such underwritten offering and shall
enter into an underwriting agreement in a form and substance reasonably satisfactory to
the Company and the underwriter or underwriters. Upon the effectiveness of the
registration statement for which piggy-back registration has been provided in this <U>Section
6.7</u>, any Event Payments payable to an Investor whose Securities are included in such
registration statement shall terminate.  </font></p>




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<P Align="Center"><Font Face="Times New Roman, Times, Serif" Size=2>ARTICLE VII </font><Br>
<Font Face="Times New Roman, Times, Serif" Size=2>MISCELLANEOUS </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.1
<U>Termination</u>. This Agreement may be terminated by the Company or any Investor, by
written notice to the other parties, if the Closing has not been consummated by the third
Business Day following the date of this Agreement; <U>provided</u>, that no such
termination will affect the right of any party to sue for any breach by the other party
(or parties).  </font></p>


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<font size=2>33</font></p>
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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.2
<U>Fees and Expenses</u>. Except as expressly set forth in the Transaction Documents to
the contrary, each party shall pay the fees and expenses of its advisers, counsel,
accountants and other experts, if any, and all other expenses incurred by such party
incident to the negotiation, preparation, execution, delivery and performance of this
Agreement. The Company shall pay all Transfer Agent fees, stamp taxes and other taxes and
duties levied in connection with the sale and issuance of their applicable Securities.  </font></p>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.3
<U>Entire Agreement</u>. The Transaction Documents, together with the <U>Exhibits</u> and
<U>Schedules</u> thereto, contain the entire understanding of the parties with respect to
the subject matter hereof and supersede all prior agreements and understandings, oral or
written, with respect to such matters, which the parties acknowledge have been merged
into such documents, exhibits and schedules. At or after the Closing, and without further
consideration, the Company and the Investors will execute and deliver to the other such
further documents as may be reasonably requested in order to give practical effect to the
intention of the parties under the Transaction Documents.  </font></p>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.4
<U>Notices</u>. Any and all notices or other communications or deliveries required or
permitted to be provided hereunder shall be in writing and shall be deemed given and
effective on the earliest of (a)&nbsp;the date of transmission, if such notice or
communication is delivered via facsimile or email at the facsimile number or email
address specified in this <U>Section&nbsp;7.4</u> prior to 5:00 p.m. (New York City time)
on a Business Day, (b)&nbsp;the next Business Day after the date of transmission, if such
notice or communication is delivered via facsimile or email at the facsimile number or
email address specified in this <U>Section 7.4</u> on a day that is not a Business Day or
later than 5:00 p.m. (New York City time) on any Business Day, (c)&nbsp;the second
Business Day following the date of deposit with a nationally recognized overnight courier
service, or (d)&nbsp;upon actual receipt by the party to whom such notice is required to
be given. The addresses, facsimile numbers and email addresses for such notices and
communications are those set forth on the signature pages hereof, or such other address
or facsimile number as may be designated in writing hereafter, in the same manner, by any
such Person.  </font></p>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.5
<U>Amendments; Waivers</u>. No provision of this Agreement may be waived or amended
except in a written instrument signed, in the case of an amendment, by the Company and
each of the Investors or, in the case of a waiver, by the party against whom enforcement
of any such waiver is sought. No waiver of any default with respect to any provision,
condition or requirement of this Agreement shall be deemed to be a continuing waiver in
the future or a waiver of any subsequent default or a waiver of any other provision,
condition or requirement hereof, nor shall any delay or omission of either party to
exercise any right hereunder in any manner impair the exercise of any such right.
Notwithstanding the foregoing, a waiver or consent to depart from the provisions hereof
with respect to a matter that relates exclusively to the rights of Investors under <U>Article&nbsp;VI</u> may
be given by Investors holding at least a majority of the Registrable Securities to which
such waiver or consent relates.  </font></p>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.6
<U>Construction</u>. The headings herein are for convenience only, do not constitute a
part of this Agreement and shall not be deemed to limit or affect any of the provisions
hereof. The language used in this Agreement will be deemed to be the language chosen by
the parties to express their mutual intent, and no rules of strict construction will be
applied against any party.  </font></p>


<p align=center>
<font size=2>34</font></p>
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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.7
<U>Successors and Assigns</u>. This Agreement shall be binding upon and inure to the
benefit of the parties and their successors and permitted assigns. The Company may not
assign this Agreement or any rights or obligations hereunder without the prior written
consent of the Investors. Any Investor may assign its rights under this Agreement to any
Person to whom such Investor assigns or transfers any Securities, provided (i) such
transferor agrees in writing with the transferee or assignee to assign such rights, and a
copy of such agreement is furnished to the Company after such assignment, (ii) the
Company is furnished with written notice of (x) the name and address of such transferee
or assignee and (y) the Registrable Securities with respect to which such registration
rights are being transferred or assigned, (iii) following such transfer or assignment,
the further disposition of such securities by the transferee or assignee is restricted
under the Securities Act and applicable state securities laws and Israeli securities
laws, (iv) such transferee agrees in writing to be bound, with respect to the transferred
Securities, by the provisions hereof that apply to the &#147;Investors&#148; and (v) such
transfer shall have been made in accordance with the applicable requirements of this
Agreement and with all laws applicable thereto.  </font></p>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.8
<U>No Third-Party Beneficiaries</u>. This Agreement is intended for the benefit of the
parties hereto and their respective successors and permitted assigns and is not for the
benefit of, nor may any provision hereof be enforced by, any other Person, except that
each Indemnified Party is an intended third party beneficiary of <U>Section&nbsp;6.4</u> and
(in each case) may enforce the provisions of such Sections directly against the parties
with obligations thereunder.  </font></p>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.9
<U>Governing Law; Venue; Waiver of Jury Trial</u>. THE CORPORATE LAWS OF THE STATE OF
ISRAEL SHALL GOVERN ALL ISSUES CONCERNING THE RELATIVE RIGHTS OF THE COMPANY AND ITS
STOCKHOLDERS. ALL QUESTIONS CONCERNING THE CONSTRUCTION, VALIDITY, ENFORCEMENT AND
INTERPRETATION OF THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK. THE COMPANY AND INVESTORS HEREBY IRREVOCABLY SUBMIT TO
THE NON-EXCLUSIVE JURISDICTION OF THE STATE AND FEDERAL COURTS SITTING IN THE CITY OF NEW
YORK, BOROUGH OF MANHATTAN FOR THE ADJUDICATION OF ANY DISPUTE BROUGHT BY THE COMPANY OR
ANY INVESTOR HEREUNDER, IN CONNECTION HEREWITH OR WITH ANY TRANSACTION CONTEMPLATED
HEREBY OR DISCUSSED HEREIN (INCLUDING WITH RESPECT TO THE ENFORCEMENT OF ANY OF THE
TRANSACTION DOCUMENTS), AND HEREBY IRREVOCABLY WAIVE, AND AGREE NOT TO ASSERT IN ANY
SUIT, ACTION OR PROCEEDING BROUGHT BY THE COMPANY OR ANY INVESTOR, ANY CLAIM THAT IT IS
NOT PERSONALLY SUBJECT TO THE JURISDICTION OF ANY SUCH COURT, OR THAT SUCH SUIT, ACTION
OR PROCEEDING IS IMPROPER. EACH PARTY HEREBY IRREVOCABLY WAIVES PERSONAL SERVICE OF
PROCESS AND CONSENTS TO PROCESS BEING SERVED IN ANY SUCH SUIT, ACTION OR PROCEEDING BY
MAILING A COPY THEREOF VIA REGISTERED OR CERTIFIED MAIL OR OVERNIGHT DELIVERY (WITH
EVIDENCE OF DELIVERY) TO SUCH PARTY AT THE ADDRESS IN EFFECT FOR NOTICES TO IT UNDER THIS
AGREEMENT AND AGREES THAT SUCH SERVICE SHALL CONSTITUTE GOOD AND SUFFICIENT SERVICE OF
PROCESS AND NOTICE THEREOF. NOTHING CONTAINED HEREIN SHALL BE DEEMED TO LIMIT IN ANY WAY
ANY RIGHT TO SERVE PROCESS IN ANY MANNER PERMITTED BY LAW. THE COMPANY AND INVESTORS
HEREBY WAIVE ALL RIGHTS TO A TRIAL BY JURY.  </font></p>

<p align=center>
<font size=2>35</font></p>
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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;THE
COMPANY DESIGNATES AND APPOINTS SILICOM CONNECTIVITY SOLUTIONS, INC., WHICH CURRENTLY
MAINTAINS AN OFFICE AT 6 FOREST AVE., PARAMUS, NEW JERSEY, AS ITS AUTHORIZED AGENT UPON
WHICH PROCESS MAY BE SERVED IN ANY SUCH SUIT OR PROCEEDING, AND AGREES THAT SERVICE OF
PROCESS UPON SUCH AGENT, AND WRITTEN NOTICE OF SAID SERVICE TO THE COMPANY BY THE PERSON
SERVING THE SAME TO THE ADDRESS PROVIDED IN SECTION 7.4 SHALL BE DEEMED IN EVERY RESPECT
EFFECTIVE SERVICE OF PROCESS UPON THE COMPANY IN ANY SUCH SUIT OR PROCEEDING. SUCH
DESIGNATION AND APPOINTMENT SHALL BE IRREVOCABLE, UNLESS AND UNTIL A SUCCESSOR AUTHORIZED
AGENT SHALL HAVE BEEN APPOINTED BY THE COMPANY, SUCH SUCCESSOR SHALL HAVE ACCEPTED SUCH
APPOINTMENT AND WRITTEN NOTICE THEREOF SHALL HAVE BEEN GIVEN TO THE INVESTORS. THE COMPANY
FURTHER AGREES TO TAKE ANY AND ALL ACTIONS AS MAY BE NECESSARY TO MAINTAIN SUCH
DESIGNATION AND APPOINTMENT OF SUCH AGENT IN FULL FORCE AND EFFECT FOR A PERIOD OF THREE
YEARS FROM THE DATE OF THIS AGREEMENT. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.10
    <U>Survival</u>.  The  representations  and warranties,  agreements and covenants contained
herein shall survive the Closing. </font></p>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.11
<U>Execution</u>. This Agreement may be executed in two or more counterparts, all of
which when taken together shall be considered one and the same agreement and shall become
effective when counterparts have been signed by each party and delivered to the other
party, it being understood that both parties need not sign the same counterpart. In the
event that any signature is delivered by facsimile transmission or email attachment, such
signature shall create a valid and binding obligation of the party executing (or on whose
behalf such signature is executed) with the same force and effect as if such facsimile or
email-attached signature page were an original thereof.  </font></p>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.12
<U>Severability</u>. If any provision of this Agreement is held to be invalid or
unenforceable in any respect, the validity and enforceability of the remaining terms and
provisions of this Agreement shall not in any way be affected or impaired thereby and the
parties will attempt to agree upon a valid and enforceable provision that is a reasonable
substitute therefor, and upon so agreeing, shall incorporate such substitute provision in
this Agreement.  </font></p>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.13
<U>Rescission and Withdrawal Right</u>. Notwithstanding anything to the contrary
contained in (and without limiting any similar provisions of) the Transaction Documents,
whenever any Investor exercises a right, election, demand or option owed to such Investor
by the Company under a Transaction Document and the Company does not timely perform its
related obligations within the periods therein provided, then, prior to the performance
by the Company of the Company&#146;s related obligation, such Investor may rescind or
withdraw, in its sole discretion from time to time upon written notice to the Company,
any relevant notice, demand or election in whole or in part without prejudice to its
future actions and rights.  </font></p>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.14
<U>Replacement of Securities</u>. If any certificate or instrument evidencing any
Securities is mutilated, lost, stolen or destroyed, the Company shall issue or cause to
be issued in exchange and substitution for and upon cancellation thereof, or in lieu of
and substitution therefor, a new certificate or instrument, but only upon receipt of
evidence reasonably satisfactory to the Company of such loss, theft or destruction and
the execution by the holder thereof of a customary lost certificate affidavit of that
fact and an agreement to indemnify and hold harmless the Company for any losses in
connection therewith. The applicants for a new certificate or instrument under such
circumstances shall also pay any reasonable third-party costs associated with the
issuance of such replacement Securities.  </font></p>


<p align=center>
<font size=2>36</font></p>
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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.15
<U>Remedies</u>. In addition to being entitled to exercise all rights provided herein or
granted by law, including recovery of damages, each of the Investors and the Company will
be entitled to seek specific performance under the Transaction Documents. The parties
agree that monetary damages may not be adequate compensation for any loss incurred by
reason of any breach of obligations described in the foregoing sentence and hereby agrees
to waive in any action for specific performance of any such obligation (other than in
connection with any action for temporary restraining order) the defense that a remedy at
law would be adequate.  </font></p>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.16
<U>Payment Set Aside</u>. To the extent that the Company makes a payment or payments to
any Investor hereunder or any Investor enforces or exercises its rights hereunder or
thereunder, and such payment or payments or the proceeds of such enforcement or exercise
or any part thereof are subsequently invalidated, declared to be fraudulent or
preferential, set aside, recovered from, disgorged by or are required to be refunded,
repaid or otherwise restored to the Company by a trustee, receiver or any other person
under any law (including, without limitation, any bankruptcy law, state or federal law,
common law or equitable cause of action), then to the extent of any such restoration,
subject to applicable law, the obligation or part thereof originally intended to be
satisfied shall be revived and continued in full force and effect as if such payment had
not been made or such enforcement or setoff had not occurred.  </font></p>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.17
<U>Adjustments in Share Numbers and Prices</u>. In the event of any stock split,
subdivision, dividend or distribution payable in Ordinary Shares (or other securities or
rights convertible into, or entitling the holder thereof to receive directly or
indirectly Ordinary Shares), combination or other similar recapitalization or event
occurring after the date hereof and prior to the Closing, each reference in any
Transaction Document to a number of shares or a price per share shall be amended to
appropriately account for such event.  </font></p>

<p align=center>
<font size=2>37</font></p>
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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.18
<U>Independent Nature of Investors&#146; Obligations and Rights</u>. The obligations of
each Investor under any Transaction Document are several and not joint with the
obligations of any other Investor, and no Investor shall be responsible in any way for
the performance of the obligations of any other Investor under any Transaction Document.
The decision of each Investor to purchase Securities pursuant to this Agreement has been
made by such Investor independently of any other Investor and independently of any
information, materials, statements or opinions as to the business, affairs, operations,
assets, properties, liabilities, results of operations, condition (financial or
otherwise) or prospects of the Company which may have been made or given by any other
Investor or by any agent or employee of any other Investor, and no Investor or any of its
agents or employees shall have any liability to any other Investor (or any other person)
relating to or arising from any such information, materials, statements or opinions.
Nothing contained herein or in any Transaction Document, and no action taken by any
Investor pursuant thereto, shall be deemed to constitute the Investors as a partnership,
an association, a joint venture or any other kind of entity, or create a presumption that
the Investors are in any way acting in concert or as a group with respect to such
obligations or the transactions contemplated by the Transaction Document. Each Investor
acknowledges that no other Investor has acted as agent for such Investor in connection
with making its investment hereunder and that no other Investor will be acting as agent
of such Investor in connection with monitoring its investment hereunder. Each Investor
shall be entitled to independently protect and enforce its rights, including without
limitation the rights arising out of this Agreement or out of the other Transaction
Documents, and it shall not be necessary for any other Investor to be joined as an
additional party in any proceeding for such purpose.  </font></p>




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<P Align=CENTER><Font Face="Times New Roman, Times, Serif" Size=2>[SIGNATURE PAGES TO
FOLLOW] </font></p>

<p align=center>
<font size=2>38</font></p>
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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;IN
WITNESS WHEREOF, the parties hereto have caused this Securities Purchase Agreement to be
duly executed by their respective authorized signatories as of the date first indicated
above. </font></p>

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<Table Width=100% Cellspacing=0 Cellpadding=0 Border=0>
<tr Valign=TOP>
<td Width=40%><Font Face="Times New Roman, Times, Serif" Size=2></font></td>
<td Width=10%><Font Face="Times New Roman, Times, Serif" Size=2></font></td>
<td Width=50%><Font Face="Times New Roman, Times, Serif" Size=2>SILICOM LTD.<Br><Br>
<br>By: <br>&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;<br>
Name:<br>Title:<Br><Br>
Address for Notice:
<Br>
<Br>8 Hanagar Street, Kfar Sava 44000, Israel
<Br>
<Br>Facsimile No.:  +972-9-765-1977
<Br>Telephone No.: +972-9-764-4555
<Br>Attn:  Chairman
</font></td>
</tr>
</table>
<br>


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     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH></TR>
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     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
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     <TD WIDTH=30% ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=70% ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>With a copy to (which shall not constitute notice):</FONT></TD></TR>
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     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD></TR>
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     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Yigal Arnon &amp; Co.</FONT></TD></TR>
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     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>One Azrieli Center</FONT></TD></TR>
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     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Round Tower - 46<Sup>th</sup> floor</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Tel Aviv, Israel</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>67021</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Facsimile: +972-3-608-7714</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Telephone: +972-3-608-7777</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Attn: David H. Schapiro, Adv.</FONT></TD></TR>
</TABLE>
<Br>

<p align=center>
<font size=2></font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>


<!-- MARKER FORMAT-SHEET="Head Minor Center-TNR" FSL="Workstation" -->
<P Align=CENTER><Font Face="Times New Roman, Times, Serif" Size=2>COMPANY SIGNATURE PAGE </font></p>

<p align=center>
<font size=2>2</font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>


<!-- MARKER FORMAT-SHEET="Head Center Underline-TNR" FSL="Workstation" -->
<P Align=CENTER><Font Face="Times New Roman, Times, Serif" Size=2><U>Investor Signature
Page </u></font></p>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Default" -->
<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;By
its execution and delivery of this signature page, the undersigned Investor hereby joins
in and agrees to be bound by the terms and conditions of the Securities Purchase Agreement
dated as of May 3, 2007 (the &#147;Purchase Agreement&#148;) by and among Silicom Ltd. and
the Investors (as defined therein), as to the number of Ordinary Shares and Warrants set
forth below, and authorizes this signature page to be attached to the Purchase Agreement
or counterparts thereof. </font></p>


<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH></TR>
<TR VALIGN=Bottom>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH></TR>
<TR VALIGN=Bottom>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH></TR>
<TR VALIGN=Bottom>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH></TR>
<TR VALIGN=Bottom>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=50% ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=50% ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Name of Investor:</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>___________________________________________</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>By: _______________________________________</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Name:</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Title:</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Jurisdiction of Investor's</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Executive Offices: ____________________________</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Address: ___________________________________</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>___________________________________________</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>___________________________________________</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Telephone No.: _______________________________</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Facsimile No.: ________________________________</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Email Address: _______________________________</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Number of Shares: _____________________________</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Number of Warrants: ___________________________</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Aggregate Purchase Price: $______________________</FONT></TD></TR>
</TABLE>
<Br>

<p align=center>
<font size=2></font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>




<!-- MARKER FORMAT-SHEET="Head Sub 2 Left-TNR" FSL="Workstation" -->
<P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>Exhibits:</font></p>

<!-- MARKER FORMAT-SHEET="Para Hang Lv 0-TNR" FSL="Workstation" -->
<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>A  </font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>Schedule
of Investors</font></td>
</tr>
</table>


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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>B  </font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>Instruction
Sheet for Investors</font></td>
</tr>
</table>



<!-- MARKER FORMAT-SHEET="Para Hang Lv 0-TNR" FSL="Workstation" -->
<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>C  </font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>Opinion
of Company Counsel</font></td>
</tr>
</table>



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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>D  </font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>Plan
of Distribution</font></td>
</tr>
</table>


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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>E  </font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>Transfer
Agent Instructions</font></td>
</tr>
</table>


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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>F  </font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>Form
of Warrant</font></td>
</tr>
</table>
<br>

<p align=center>
<font size=2>2</font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>


<!-- MARKER FORMAT-SHEET="Head Major Center Bold 1-TNR" FSL="Workstation" -->
<H1 Align=CENTER><Font Face="Times New Roman, Times, Serif" Size=2>Exhibit A </font></h1>


<!-- MARKER FORMAT-SHEET="Head Major Center Bold 1-TNR" FSL="Default" -->
<H1 Align=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><U>Schedule of Investors</U> </FONT> </h1>




<TABLE CELLPADDING=3 CELLSPACING=0 BORDER=1 WIDTH=100%>
<TR VALIGN=Bottom>
     <TH><FONT FACE="Times New Roman" SIZE=1>Investor</FONT></TH>
     <TH><FONT FACE="Times New Roman" SIZE=1>Shares</FONT></TH>
     <TH><FONT FACE="Times New Roman" SIZE=1>Warrants</FONT></TH>
     <Th Align="Center"><FONT FACE="Times New Roman" SIZE="1">Warrant Shares</FONT></TH>
     <TH><FONT FACE="Times New Roman" SIZE=1>Purchase Price (US $)</FONT></TH></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=60%  ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Iroquois Master Fund Ltd.</FONT></TD>
     <TD WIDTH=10%  ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>30,000</FONT></TD>
     <TD WIDTH=10%  ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>7,500</FONT></TD>
     <Td Width="10%" Align="Center"><FONT FACE="Times New Roman" SIZE="2"><I>See Warrants</I> </FONT></TD>
     <TD WIDTH=10%  ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>615,000</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Macabee Capital, LP</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>20,000</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>5,000</FONT></TD>
     <Td Align="Center"><FONT FACE="Times New Roman" SIZE="2"><I>See Warrants</I> </FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>410,000</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Radcliffe SPC Ltd. for and on behalf of the Class A Segregated Portfolio</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>40,000</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>10,000</FONT></TD>
     <Td Align="Center"><FONT FACE="Times New Roman" SIZE="2"><I>See Warrants</I> </FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>820,000</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>RHP Master Fund, Ltd.</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>35,000</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>8,750</FONT></TD>
     <Td Align="Center"><FONT FACE="Times New Roman" SIZE="2"><I>See Warrants</I> </FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>717,500</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>SF Capital Partners Ltd</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>100,000</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>25,000</FONT></TD>
     <Td Align="Center"><FONT FACE="Times New Roman" SIZE="2"><I>See Warrants</I> </FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>2,050,000</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>UBS O'Connor LLC Fbo O'Connor Pipes Corporate Strategies Master Limited</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>30,000</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>7,500</FONT></TD>
     <Td Align="Center"><FONT FACE="Times New Roman" SIZE="2"><I>See Warrants</I> </FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>615,000</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Hudson Bay Fund LP</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>30,100</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>7,525</FONT></TD>
     <Td Align="Center"><FONT FACE="Times New Roman" SIZE="2"><I>See Warrants</I> </FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>617,050</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Hudson Bay Overseas Fund Ltd</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>39,900</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>9,975</FONT></TD>
     <Td Align="Center"><FONT FACE="Times New Roman" SIZE="2"><I>See Warrants</I> </FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>817,950</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Cranshire Capital, L.P.</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>30,000</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>7,500</FONT></TD>
     <Td Align="Center"><FONT FACE="Times New Roman" SIZE="2"><I>See Warrants</I> </FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>615,000</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Evolution Master Fund Ltd SPC, Segregated Portfolio M</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>37,500</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>9,375</FONT></TD>
     <Td Align="Center"><FONT FACE="Times New Roman" SIZE="2"><I>See Warrants</I> </FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>768,750</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Fort Mason Partners, LP</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>4,263</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>1,066</FONT></TD>
     <Td Align="Center"><FONT FACE="Times New Roman" SIZE="2"><I>See Warrants</I> </FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>87,391.50</FONT></TD></TR>
</table>
<Br>

<p align=center>
<font size=2></font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>

<TABLE CELLPADDING=3 CELLSPACING=0 BORDER=1 WIDTH=100%>
<TR VALIGN=Bottom>
     <TD WIDTH=60%  ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Fort Mason Master, LP</FONT></TD>
     <TD WIDTH=10%  ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>65,737</FONT></TD>
     <TD WIDTH=10%  ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>16,434</FONT></TD>
     <Td Width="10%" Align="Center"><FONT FACE="Times New Roman" SIZE="2"><I>See Warrants</I> </FONT></TD>
     <TD WIDTH=10%  ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>1,347,608.50</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Bluenose Master Fund, Ltd.</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>60,830</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>15,208</FONT></TD>
     <Td Align="Center"><FONT FACE="Times New Roman" SIZE="2"><I>See Warrants</I> </FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>1,247,015</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Bluenose Capital Fund (QP), L.P.</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>39,170</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>9,792</FONT></TD>
     <Td Align="Center"><FONT FACE="Times New Roman" SIZE="2"><I>See Warrants</I> </FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>802,985</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>JMG Capital Partners, LP</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>17,500</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>4,375</FONT></TD>
     <Td Align="Center"><FONT FACE="Times New Roman" SIZE="2"><I>See Warrants</I> </FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>358,750</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>JMG Triton Offshore Fund, Ltd.</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>17,500</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>4,375</FONT></TD>
     <Td Align="Center"><FONT FACE="Times New Roman" SIZE="2"><I>See Warrants</I> </FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>358,750</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Rockmore Investment Master Fund Ltd</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>25,000</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>6,250</FONT></TD>
     <Td Align="Center"><FONT FACE="Times New Roman" SIZE="2"><I>See Warrants</I> </FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>512,500</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Crosslink Crossover Fund V, L.P.</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>110,000</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>27,500</FONT></TD>
     <Td Align="Center"><FONT FACE="Times New Roman" SIZE="2"><I>See Warrants</I> </FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>2,255,000</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Enable Growth Partners LP</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>34,000</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>8,500</FONT></TD>
     <Td Align="Center"><FONT FACE="Times New Roman" SIZE="2"><I>See Warrants</I> </FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>697,000</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Enable Opportunity Partners LP</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>4,000</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>1,000</FONT></TD>
     <Td Align="Center"><FONT FACE="Times New Roman" SIZE="2"><I>See Warrants</I> </FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>82,000</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Pierce Diversified Strategy Master Fund LLC, Ena</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>2,000</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>500</FONT></TD>
     <Td Align="Center"><FONT FACE="Times New Roman" SIZE="2"><I>See Warrants</I> </FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>41,000</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Capital Ventures International</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>37,500</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>9,375</FONT></TD>
     <Td Align="Center"><FONT FACE="Times New Roman" SIZE="2"><I>See Warrants</I> </FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>768,750</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Heller Capital Investments</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>30,000</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>7,500</FONT></TD>
     <Td Align="Center"><FONT FACE="Times New Roman" SIZE="2"><I>See Warrants</I> </FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>615,000</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE="2"><B>TOTAL:</B> </FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE="2"><B>840,000</B> </FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE="2"><B>210,000</B> </FONT></TD>
     <Td Align="Center"><FONT FACE="Times New Roman" SIZE="2"><B>&nbsp;</B> </FONT> </TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE="2"><B>$17,220,000</B> </FONT></TD></TR>
</TABLE>
<Br>

<p align=center>
<font size=2></font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>




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<H1 Align=CENTER><Font Face="Times New Roman, Times, Serif" Size=2>Exhibit&nbsp;B </font></h1>

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<H1 Align=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><U>INSTRUCTION SHEET FOR
INVESTOR</U> </FONT> </h1>

<P align=center><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(to be read in conjunction with the entire Securities Purchase Agreement)</FONT></P>

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<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>A.  </font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2><U>Complete
the following items in the Securities Purchase Agreement</u>:</font></td>
</tr>
</table>
<br>

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<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>1. </font></td>
<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>Complete
and execute the Investor Signature Page. The Agreement must be executed                by
an individual authorized to bind the Investor. </font></td>
</tr>
</table>
<br>

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<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>2. </font></td>
<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>Exhibit&nbsp;B-1
&#150; Stock Certificate Questionnaire: </font></td>
</tr>
</table>
<br>

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<td Width=5%>&nbsp;</td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>
<U>Provide
the information requested by the Stock Certificate Questionnaire</u>;  </font></td>
</tr>
</table>
<br>

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<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>3. </font></td>
<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>Exhibit&nbsp;B-2
&#150; Registration Statement Questionnaire: </font></td>
</tr>
</table>
<br>

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<td Width=5%>&nbsp;</td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>
<U>Provide
the information requested by the Registration Statement Questionnaire</u>.  </font></td>
</tr>
</table>
<br>

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<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>4. </font></td>
<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>Exhibit&nbsp;B-3
&#150; Investor Certificate: </font></td>
</tr>
</table>
<br>

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<td Width=5%>&nbsp;</td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>
Provide
the information requested by the Certificate for Individual Investors (B-3) or the
Certificate for Corporate, Partnership, Trust, Foundation and Joint Investors (B-4), as
applicable.  </font></td>
</tr>
</table>
<br>

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<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>5. </font></td>
<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>Return,
via facsimile, the signed Securities Purchase Agreement including the
               properly completed Exhibits B-1 through B-3, to: </font></td>
</tr>
</table>
<br>


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<td Width=15%>&nbsp;</td>
<td Width=85%><Font Face="Times New Roman, Times, Serif" Size=2>
Facsimile:
<Br>Telephone: <Br>Attn: </font></td>
</tr>
</table>
<br>


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<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>6. </font></td>
<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>After
completing instruction number five (5) above, deliver the original signed
               Securities Purchase Agreement including the properly completed Exhibits
               &nbsp;B-1 through B-3 to: </font></td>
</tr>
</table>
<br>

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<td Width=15%>&nbsp;</td>
<td Width=85%><Font Face="Times New Roman, Times, Serif" Size=2>
Facsimile:
<Br>Telephone: <Br>Attn: </font></td>
</tr>
</table>
<br>

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<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>B.  </font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>Instructions
regarding the wire transfer of funds for the purchase of the Shares                will
be telecopied to the Investor by the Company at a later date. </font></td>
</tr>
</table>
<br>

<p align=center>
<font size=2></font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>


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<H1 Align=CENTER><Font Face="Times New Roman, Times, Serif" Size=2>Exhibit&nbsp;B-1 </font></h1>

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<H1 Align=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><U>Silicom Ltd.</U> </FONT> </h1>

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<H1 Align=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><U>STOCK CERTIFICATE
QUESTIONNAIRE</U> </FONT> </h1>

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<td Width=5%>&nbsp;</td>
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Please
provide us with the following information:  </font></td>
</tr>
</table>
<br>

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<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>1.  </font></td>
<td Width=65%><Font Face="Times New Roman, Times, Serif" Size=2>The
exact name that the Securities are to be registered in (this is the name           that
will appear on the stock certificate(s)). <Br>You may use a nominee name if
          appropriate: </font></td>
<Td Width="30%" Valign="Bottom"> <Font Face="Times New Roman, Times, Serif" Size=2>___________________________________  </font></td>
</tr>
</table>
<br>

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<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>2.  </font></td>
<td Width=65%><Font Face="Times New Roman, Times, Serif" Size=2>The
relationship between the Investor of the Securities and the Registered           Holder
listed in response to item 1 above: </font></td>
<Td Width="30%" Valign="Bottom"> <Font Face="Times New Roman, Times, Serif" Size=2>___________________________________  </font></td>
</tr>
</table>
<br>

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<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>3.  </font></td>
<td Width=65%><Font Face="Times New Roman, Times, Serif" Size=2>The
mailing address, telephone and telecopy number and email address of <Br>the
          Registered Holder listed in response to item 1 above: </font></td>
<Td Width="30%" Valign="Bottom"> <Font Face="Times New Roman, Times, Serif" Size=2><Br>___________________________________<Br><Br>___________________________________
<Br><Br>___________________________________
<Br><Br>___________________________________
<Br><Br>___________________________________
 </font></td>
</tr>
</table>
<br>

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<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>4.  </font></td>
<td Width=65%><Font Face="Times New Roman, Times, Serif" Size=2>The
United States Tax Identification Number of the Registered Holder listed in
          response to item 1 above: </font></td>
<Td Width="30%" Valign="Bottom"> <Font Face="Times New Roman, Times, Serif" Size=2>___________________________________  </font></td>
</tr>
</table>
<br>

<p align=center>
<font size=2></font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>


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<H1 Align=CENTER><Font Face="Times New Roman, Times, Serif" Size=2>Exhibit B-2 </font></h1>

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<H1 Align=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><U>Silicom Ltd.</U> </FONT> </h1>

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<H1 Align=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><U>REGISTRATION STATEMENT
QUESTIONNAIRE</U> </FONT> </h1>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
connection with the Registration Statement, please provide us with the following
information regarding the Investor. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>1. &nbsp;&nbsp;&nbsp;&nbsp;Please
state your or your organization&#146;s name exactly as it should appear           in the
Registration Statement:  </font></p>

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<td Width=5%>&nbsp;</td>
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______________________________________________________________________  </font></td>
</tr>
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<br>



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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>
Except
as set forth below, your organization does not hold any equity securities of the Company
on behalf of another person or entity.  </font></td>
</tr>
</table>
<br>

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State
any exceptions here:  </font></td>
</tr>
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<br>

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<td Width=5%>&nbsp;</td>
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______________________________________________________________________ </font></td>
</tr>
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<br>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>2. &nbsp;&nbsp;&nbsp;&nbsp;Address
of your organization:  </font></p>


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______________________________________________________ </font></td>
</tr>
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______________________________________________________ </font></td>
</tr>
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<br>

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Telephone:
 __________________________ </font></td>
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Fax:
 ________________________________ </font></td>
</tr>
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<br>

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Contact
Person:  _______________________ </font></td>
</tr>
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<br>



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<P><Font Face="Times New Roman, Times, Serif" Size=2>3. &nbsp;&nbsp;&nbsp;&nbsp;Have you
or your organization had any position, office or other material           relationship
within the past three years with the Company or its affiliates?           (Include any
relationships involving you or your affiliates, officers,           directors, or
principal equity holders (5% or more) that has held any position           or office or
has had any other material relationship with the Company (or its           predecessors
or affiliates) during the past three years.)  </font></p>


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_______ &nbsp;&nbsp; Yes  &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; _______ &nbsp;&nbsp;  No </font></td>
</tr>
</table>
<br>

<p align=center>
<font size=2></font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>


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<td Width=5%>&nbsp;</td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>
If
yes, please indicate the nature of any such relationship below:  </font></td>
</tr>
</table>
<br>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>4. &nbsp;&nbsp;&nbsp;&nbsp;Are you
or your organization the beneficial owner of any other securities of the
          Company? (Include any equity securities that you or your organization
          beneficially own or have a right to acquire within 60 days after the date
          hereof, and as to which you or your organization have sole voting power, shared
          voting power, sole investment power or shared investment power.)  </font></p>

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<td Width=5%>&nbsp;</td>
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_______ &nbsp;&nbsp; Yes  &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; _______ &nbsp;&nbsp;  No </font></td>
</tr>
</table>
<br>


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If
yes, please describe the nature and amount of such ownership as of a recent date.  </font></td>
</tr>
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<br>

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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>
Do
you or your organization wish to disclaim beneficial ownership of any of the shares
reported above for purposes of the Registration Statement?  </font></td>
</tr>
</table>
<br>

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_______ &nbsp;&nbsp; Yes  &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; _______ &nbsp;&nbsp;  No </font></td>
</tr>
</table>
<br>

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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>
Who
is the individual that exercises sole/shared voting/dispositive control over the shares
reported above? If such control is held by more that one individual, please state the
name of all individuals that participate in any such decision-making powers regarding
such shares.  </font></td>
</tr>
</table>
<br>

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<td Width=10%>&nbsp;</td>
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______________________________________________________ </font></td>
</tr>
</table>
<br>

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______________________________________________________ </font></td>
</tr>
</table>
<br>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>5. &nbsp;&nbsp;&nbsp;&nbsp;Except as
set forth below, you or your organization wish that all of the Shares           and
Warrant Shares beneficially owned by you or your organization that you or           your
organization, as applicable, have the right to acquire from the Company be
          offered for your or your organization account in the Registration Statement.  </font></p>

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<td Width=10%>&nbsp;</td>
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State
any exceptions here:  </font></td>
</tr>
</table>
<br>

<p align=center>
<font size=2>2</font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>6. &nbsp;&nbsp;&nbsp;&nbsp;Have you
or your organization made or are you or your organization aware of any
          arrangements relating to the distribution of the Ordinary Shares of the Company
          pursuant to the Registration Statement?  </font></p>

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_______ &nbsp;&nbsp; Yes  &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; _______ &nbsp;&nbsp;  No </font></td>
</tr>
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<br>

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If
yes, please describe the nature and amount of such arrangements.  </font></td>
</tr>
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<br>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>7. &nbsp;&nbsp;&nbsp;&nbsp;NASD
Matters  </font></p>

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     <P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          State below whether (i) you or any <I>associate</i> or <I>affiliate</i> of yours
          are a <I>member</i> of the NASD, a <I>controlling</i> shareholder of an NASD
          <I>member</i>, a <I>person assoc</i>i<I>ated with a member</i>, a direct or
          indirect <I>affiliate</i> of a <I>member</i>, or an <I>underwriter or related
          person</i> with respect to the proposed offering; (ii) you or any
          <I>associate</i> or <I>affiliate</i> of yours owns any stock or other securities
          of any NASD <I>member</i> not purchased in the open market; or (iii) you or any
          <I>associate</i> or <I>affiliate</i> of yours has made any outstanding
          subordinated loans to any NASD <I>member</i>. If you are a general or limited
          partnership, a no answer asserts that no such relationship exists for you as
          well as for each of your general or limited partners. </font></p>


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_______ &nbsp;&nbsp; Yes  &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; _______ &nbsp;&nbsp;  No </font></td>
</tr>
</table>
<br>


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If
&#147;yes,&#148; please identify the NASD <I>member</i> and describe your relationship,
including, in the case of a general or limited partner, the name of the partner:  </font></td>
</tr>
</table>
<br>

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If
you answer &#147;no&#148; to Question 7(a), you need not respond to Question 7(b).  </font></td>
</tr>
</table>
<br>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;(b) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;State
below whether you or any <I>associate</i> or <I>affiliate</i> of yours has
                    been an underwriter, or a <I>controlling</i> person or member of any
investment                     banking or brokerage firm which has been or might be an
underwriter for                     securities of the Corporation or any <I>affiliate</i> thereof
including, but not                     limited to, the common stock now being registered.  </font></p>

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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>
_______ &nbsp;&nbsp; Yes  &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; _______ &nbsp;&nbsp;  No </font></td>
</tr>
</table>
<br>

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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>
If
&#147;yes,&#148; please identify the NASD <I>member</i> and describe your relationship,
including, in the case of a general or limited partner, the name of the partner.  </font></td>
</tr>
</table>
<br>

<p align=center>
<font size=2>3</font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>



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<P Align=CENTER><Font Face="Times New Roman, Times, Serif" Size=2><U>ACKNOWLEDGEMENT </u></font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
undersigned hereby agrees to notify the Company promptly of any changes in the foregoing
information which should be made as a result of any developments, including the passage of
time. The undersigned also agrees to provide the Company and the Company&#146;s counsel
any and all such further information regarding the undersigned promptly upon request in
connection with the preparation, filing, amending, and supplementing of the Registration
Statement (or any prospectus contained therein). The undersigned hereby consents to the
use of all such information in the Registration Statement. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
undersigned understands and acknowledges that the Company will rely on the information set
forth herein for purposes of the preparation and filing of the Registration Statement. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
undersigned understands that the undersigned may be subject to serious civil and criminal
liabilities if the Registration Statement, when it becomes effective, either contains an
untrue statement of a material fact or omits to state a material fact required to be
stated in the Registration Statement or necessary to make the statements in the
Registration Statement not misleading. The undersigned represents and warrants that all
information it provides to the Company and its counsel is currently accurate and complete
and will be accurate and complete at the time the Registration Statement becomes effective
and at all times subsequent thereto, and agrees during the Effectiveness Period and any
additional period in which the undersigned is making sales of Shares under and pursuant to
the Registration Statement, and agrees during such periods to notify the Company
immediately of any misstatement of a material fact in the Registration Statement, and of
the omission of any material fact necessary to make the statements contained therein not
misleading. </font></p>


<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <Th> </th>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH></TR>
<TR VALIGN=Bottom>
     <Th> </th>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH></TR>
<TR VALIGN=Bottom>
     <Th> </th>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH></TR>
<TR VALIGN=Bottom>
     <Th> </th>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH></TR>
<TR VALIGN=Bottom>
     <Th> </th>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH></TR>
<TR VALIGN=Bottom>
     <Td WIDTH=5%> </td>
     <TD WIDTH=35% ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Dated: __________</FONT></TD>
     <TD WIDTH=60% ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <Td> </td>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>______________________________</FONT></TD></TR>
<TR VALIGN=Bottom>
     <Td> </td>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Name</FONT></TD></TR>
<TR VALIGN=Bottom>
     <Td> </td>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <Td> </td>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>______________________________</FONT></TD></TR>
<TR VALIGN=Bottom>
     <Td> </td>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Signature</FONT></TD></TR>
<TR VALIGN=Bottom>
     <Td> </td>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <Td> </td>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>______________________________</FONT></TD></TR>
<TR VALIGN=Bottom>
     <Td> </td>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Name and Title of Signatory</FONT></TD></TR>
</TABLE>
<Br>

<p align=center>
<font size=2>4</font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>


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<H1 Align=CENTER><Font Face="Times New Roman, Times, Serif" Size=2>Exhibit&nbsp;B-3 </font></h1>

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<H1 Align=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><U>Silicom Ltd.</U> </FONT> </h1>

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<H1 Align=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><U>CERTIFICATE FOR
CORPORATE, PARTNERSHIP, LIMITED LIABILITY COMPANY, <BR>TRUST, FOUNDATION AND JOINT
INVESTORS</U> </FONT> </h1>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If
the investor is a corporation, partnership, limited liability company, trust, pension
plan, foundation, joint Investor (other than a married couple) or other entity, an
authorized officer, partner, or trustee must complete, date and sign this Certificate. </font></p>

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<H1 Align=CENTER><Font Face="Times New Roman, Times, Serif" Size=2><U>CERTIFICATE</u> </font></h1>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
undersigned certifies that the representations and responses below are true and accurate: </font></p>

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     <P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          The investor has been duly formed and is validly existing and has full power and
          authority to invest in the Company. The person signing on behalf of the
          undersigned has the authority to execute and deliver the Securities Purchase
          Agreement on behalf of the Investor and to take other actions with respect
          thereto. </font></p>

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     <P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          Indicate the form of entity of the undersigned: </font></p>

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<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;____
    Limited Partnership </font>
</td>
</tr>
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<br>

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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
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<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;____
    General Partnership </font>
</td>
</tr>
</table>
<br>

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<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;____
    Limited Liability Company </font>
</td>
</tr>
</table>
<br>

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<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;____
    Corporation </font>
</td>
</tr>
</table>
<br>

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<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=95%><FONT FACE="Times New Roman, Times, Serif" SIZE="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;____
Revocable Trust (identify each grantor and indicate under what circumstances the trust is revocable by the grantor):
<U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><Br>
 </FONT>
</td>
</tr>
</table>



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<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
_____________________________________________________________________________________________________________________________________________________________________<Br>
(Continue on a separate piece of paper, if necessary.) </font>
</td>
</tr>
</table>
<br>




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<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;____
Other type of Trust (indicate type of trust and, for trusts other than pension trusts,
name the grantors and beneficiaries):  <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>
</font>
</td>
</tr>
</table>





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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
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<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
_____________________________________________________________________________________________________________________________________________________________________<Br>(Continue
on a separate piece of paper, if necessary.) </font>
</td>
</tr>
</table>
<br>


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<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;____
    Other form of organization (indicate form of organization
(____________________________________________________). </font>
</td>
</tr>
</table>
<br>

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     <P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          Indicate the approximate date the undersigned entity was formed: <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </u>. </font></p>

<p align=center>
<font size=2>5</font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>


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     <P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          In order for the Company to offer and sell the Units in conformance with state
          and federal securities laws, the following information must be obtained
          regarding your investor status. Please <U>initial each category</u> applicable
          to you as an investor in the Company. </font></p>

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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>___ </font></td>
<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>1. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
A bank as defined in Section 3(a)(2) of the Securities Act, or any savings and loan
association or other institution as defined in Section 3(a)(5)(A) of the Securities Act
whether acting in its individual or fiduciary capacity; </font></td>
</tr>
</table>
<br>

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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>         ___  </font></td>
<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>2. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
      A  broker  or  dealer  registered  pursuant  to  Section 15  of the  Securities
                  Exchange Act of 1934;</font></td>
</tr>
</table>
<br>

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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>         ___  </font></td>
<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>3. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
      An insurance company as defined in Section 2(13) of the Securities Act;</font></td>
</tr>
</table>
<br>

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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>         ___  </font></td>
<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>4. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
      An investment  company registered under the Investment Company Act of 1940 or a
                  business development company as defined in Section  2(a)(48) of that
Act;</font></td>
</tr>
</table>
<br>

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<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>         ___  </font></td>
<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>5. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
      A Small  Business  Investment  Company  licensed  by the  U.S.  Small  Business
                  Administration  under  Section 301(c)  or (d) of the Small  Business
 Investment  Act of                   1958;</font></td>
</tr>
</table>
<br>

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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>         ___  </font></td>
<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>6. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
      A plan  established and maintained by a state, its political  subdivisions,  or
                  any  agency  or  instrumentality  of a  state  or its  political
 subdivisions,  for the                   benefit of its employees, if such plan has
total assets in excess of $5,000,000;</font></td>
</tr>
</table>
<br>

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<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>___ </font></td>
<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>7. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
An employee benefit plan within the meaning of the Employee Retirement Income Security
Act of 1974, if the investment decision is made by a plan fiduciary, as defined in Section&nbsp;3(21)
of such Act, which is either a bank, savings and loan association, insurance company, or
registered investment advisor, or if the employee benefit plan has total assets in excess
of $5,000,000 or, if a self-directed plan, with investment decisions made solely by
persons that are accredited investors; </font></td>
</tr>
</table>
<br>

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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>         ___  </font></td>
<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>8. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
      A private business development company as defined in  Section 202(a)(22) of the
                  Investment Advisers Act of 1940;</font></td>
</tr>
</table>
<br>

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<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>         ___  </font></td>
<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>9. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
      Any   partnership   or   corporation   or   any   organization   described   in
                  Section 501(c)(3)  of the Internal  Revenue Code or similar  business
trust,  not formed                   for the  specific  purpose of  acquiring  the
 Shares,  with  total  assets in excess of                   $5,000,000;</font></td>
</tr>
</table>
<br>

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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>         ___  </font></td>
<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>10. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
     A trust,  with  total  assets in  excess  of  $5,000,000,  not  formed  for the
                  specific   purpose  of  acquiring   the  Shares,   whose   purchase  is
 directed  by  a                   sophisticated person as described in Rule
 506(b)(2)(ii) of the Exchange Act;</font></td>
</tr>
</table>
<br>

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<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>___  </font></td>
<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>11. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
An entity in which all of the equity owners qualify under any of the above subparagraphs.
If the undersigned belongs to this investor category only, list the equity owners of the
undersigned, and the investor category which each such equity owner satisfies:  _____________________________________________<Br>(Continue
on a separate piece of paper, if necessary.)</font></td>
</tr>
</table>
<br>


<p align=center>
<font size=2>6</font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Please
set forth in the space provided below the (i)&nbsp;states, if any, in the U.S. in which
you maintained your principal office during the past two years and the dates during which
you maintained your office in each state, (ii)&nbsp;state(s), if any, in which you are
incorporated or otherwise organized and (iii)&nbsp;state(s), if any, in which you pay
income taxes. </font></p>


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<tr Valign=TOP>
<td Width=10%>&nbsp;</td>
<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>
__________________________________________________________________________ </font></td>
</tr>
</table>
<br>

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<tr Valign=TOP>
<td Width=10%>&nbsp;</td>
<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>
__________________________________________________________________________ </font></td>
</tr>
</table>
<br>

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<tr Valign=TOP>
<td Width=10%>&nbsp;</td>
<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>
__________________________________________________________________________  </font></td>
</tr>
</table>
<br>

<!-- MARKER FORMAT-SHEET="Head Left-TNR" FSL="Workstation" -->
<P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>Dated:__________________________,
2007 </font></p>


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<P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>__________________________<Br>Print Name of Investor </font></p>


<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>_________________________________________________
<Br>Name:
<Br>Title:
<Br>(Signature and title of authorized officer, partner or trustee)
</FONT></P>

<p align=center>
<font size=2>7</font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>


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<H1 Align=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><U>SECURITIES DELIVERY
INSTRUCTIONS</U> </FONT> </h1>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>Please instruct us as to where you
would like the Securities delivered to at Closing: </font></p>

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<P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>Name:
_________________________________________________________ </font></p>

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<P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>Company:
______________________________________________________ </font></p>

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<P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>Address:
_______________________________________________________<Br><Br>______________________________________________________________ </font></p>

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<P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>Telephone:
______________________________________________________ </font></p>

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<P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>Other Special
Instructions: __________________________________________<Br><Br>______________________________________________________________ </font></p>

<p align=center>
<font size=2>8</font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>


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<H1 Align=CENTER><Font Face="Times New Roman, Times, Serif" Size=2>Exhibit&nbsp;C </font></h1>

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<H1 Align=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><U>OPINION OF COMPANY
COUNSEL</U> </FONT> </h1>

<!-- MARKER FORMAT-SHEET="Head Major Left Bold-TNR" FSL="Workstation" -->
<H1 Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>[To be attached] </font></h1>

<p align=center>
<font size=2></font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>


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<H1 Align=CENTER><Font Face="Times New Roman, Times, Serif" Size=2>Exhibit&nbsp;D </font></h1>





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<H1 Align=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><U>PLAN OF DISTRIBUTION</U> </FONT> </h1>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
selling stockholders and any of their respective pledgees, donees, assignees and other
successors in interest may, from time to time, sell any or all of their shares of common
stock on any stock exchange, market or trading facility on which the shares are traded or
in private transactions. These sales may be at fixed or negotiated prices. The selling
stockholders may use any one or more of the following methods when selling shares: </font></p>

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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2><FONT size="2" face="Wingdings 2">&#151;</font>  </font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>ordinary
brokerage transactions and transactions in which the broker-dealer solicits purchasers;</font></td>
</tr>
</table>
<br>

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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2><FONT size="2" face="Wingdings 2">&#151;</font>  </font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>block
trades in which the broker-dealer will attempt to sell the shares as agent but may
position and resell a portion of the block as principal to facilitate the transaction; </font></td>
</tr>
</table>
<br>

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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2><FONT size="2" face="Wingdings 2">&#151;</font>  </font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>purchases
by a broker-dealer as principal and resale by the broker-dealer for its account;</font></td>
</tr>
</table>
<br>

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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2><FONT size="2" face="Wingdings 2">&#151;</font>  </font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>an
exchange distribution in accordance with the rules of the applicable exchange;</font></td>
</tr>
</table>
<br>

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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2><FONT size="2" face="Wingdings 2">&#151;</font>  </font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>privately
negotiated transactions;</font></td>
</tr>
</table>
<br>

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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2><FONT size="2" face="Wingdings 2">&#151;</font>  </font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>short
sales;</font></td>
</tr>
</table>
<br>

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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2><FONT size="2" face="Wingdings 2">&#151;</font>  </font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>broker-dealers
may agree with the selling stockholders to sell a specified number of such shares at
     a stipulated price per share;</font></td>
</tr>
</table>
<br>

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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2><FONT size="2" face="Wingdings 2">&#151;</font>  </font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>through
the writing of options, swaps or other derivatives which may or may not be listed on an
 exchange; </font></td>
</tr>
</table>
<br>

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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2><FONT size="2" face="Wingdings 2">&#151;</font>  </font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>a
combination of any such methods of sale; and</font></td>
</tr>
</table>
<br>

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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2><FONT size="2" face="Wingdings 2">&#151;</font>  </font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>any
other method permitted pursuant to applicable law.</font></td>
</tr>
</table>
<br>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
selling stockholders may also sell shares under Rule 144 under the Securities Act, if
available, rather than under this prospectus. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
selling stockholders may also engage in short sales against the box after this
registration statement becomes effective, puts and calls and other transactions in our
shares or derivatives of our shares and may sell or deliver shares in connection with
these trades. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Broker-dealers
engaged by the selling stockholders may arrange for other brokers-dealers to participate
in sales. Broker-dealers may receive commissions or discounts from the selling
stockholders (or, if any broker-dealer acts as agent for the purchaser of shares, from the
purchaser) in amounts to be negotiated. The selling stockholders do not expect these
commissions and discounts to exceed what is customary in the types of transactions
involved. Any profits on the resale of shares of common stock by a broker-dealer acting as
principal might be deemed to be underwriting discounts or commissions under the Securities
Act. </font></p>

<p align=center>
<font size=2></font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
selling stockholders may enter into derivative or other hedging transactions with
financial institutions. These financial institutions may in turn engage in sales of the
shares to hedge their position, deliver this prospectus in connection with some or all of
those sales and use the shares covered by this prospectus to close out any short position
created in connection with those sales. The selling stockholders may also sell shares of
the shares short using this prospectus and deliver the shares covered by this prospectus
to close out such short positions, or loan or pledge the shares to financial institutions
that in turn may sell the shares using this prospectus. The selling stockholders may
pledge or grant a security interest in some or all of the shares covered by this
prospectus to support a derivative or hedging position or other obligation and, if the
selling stockholders default in the performance of their obligations, the pledgees or
secured parties may offer and sell the shares from time to time pursuant to this
prospectus. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Discounts,
concessions, commissions and similar selling expenses, if any, attributable to the sale of
shares will be borne by a selling stockholder. The selling stockholders may agree to
indemnify any agent, dealer or broker-dealer that participates in transactions involving
sales of the shares against certain liabilities, including liabilities that may be imposed
on that person under the Securities Act. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
selling stockholders may from time to time pledge or grant a security interest in some or
all of the shares of common stock owned by them and, if they default in the performance of
their secured obligations, the pledgees or secured parties may offer and sell the shares
of common stock from time to time under this prospectus, or, if required, after we have
filed a supplement to this prospectus under Rule 424(b)(3) or other applicable provision
of the Securities Act of 1933 supplementing or amending the list of selling stockholders
to include the pledgee, transferee or other successors in interest as selling stockholders
under this prospectus. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
selling stockholders also may transfer the shares of common stock in other circumstances,
in which case the transferees, pledgees or other successors in interest will be the
selling beneficial owners for purposes of this prospectus and may sell the shares of
common stock from time to time under this prospectus, or, if required, after we have filed
a supplement to this prospectus under Rule 424(b)(3) or other applicable provision of the
Securities Act of 1933 supplementing or amending the list of selling stockholders to
include the pledgee, transferee or other successors in interest as selling stockholders
under this prospectus. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
selling stockholders and any broker-dealers or agents that are involved in selling the
shares of common stock may be deemed to be &#147;underwriters&#148; within the meaning of
the Securities Act in connection with such sales. In such event, any commissions received
by such broker-dealers or agents and any profit on the resale of the shares of common
stock purchased by them may be deemed to be underwriting commissions or discounts under
the Securities Act. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
are required to pay all fees and expenses incident to the registration of the shares of
common stock. We have agreed to indemnify the selling stockholders against certain losses,
claims, damages and liabilities, including liabilities under the Securities Act. </font></p>

<p align=center>
<font size=2></font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
selling stockholders have advised us that they have not entered into any agreements,
understandings or arrangements with any underwriters or broker-dealers regarding the sale
of their shares of common stock, nor is there an underwriter or coordinating broker acting
in connection with a proposed sale of shares of common stock by any selling stockholder.
If we are notified by any selling stockholder that any material arrangement has been
entered into with a broker-dealer for the sale of shares of common stock, if required, we
will file a supplement to this prospectus. If the selling stockholders use this prospectus
for any sale of the shares of common stock, they will be subject to the prospectus
delivery requirements of the Securities Act. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
have advised the selling stockholders that the anti-manipulation rules of Regulation M
under the Securities Exchange Act of 1934 may apply to sales of our common stock and
activities of the selling stockholders. </font></p>










<p align=center>
<font size=2></font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>


<!-- MARKER FORMAT-SHEET="Head Major Center Bold 1-TNR" FSL="Workstation" -->
<H1 Align=CENTER><Font Face="Times New Roman, Times, Serif" Size=2>Exhibit&nbsp;E </font></h1>

<!-- MARKER FORMAT-SHEET="Head Major Center Bold-TNR" FSL="Workstation" -->
<H1 Align=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><U>COMPANY TRANSFER AGENT
INSTRUCTIONS</U> </FONT> </h1>

<!-- MARKER FORMAT-SHEET="Head Left-TNR" FSL="Workstation" -->
<P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>American Stock Transfer
&amp; Trust Company </font></p>

<!-- MARKER FORMAT-SHEET="Head Left-TNR" FSL="Workstation" -->
<P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>Attention: </font></p>

<!-- MARKER FORMAT-SHEET="Head Left-TNR" FSL="Workstation" -->
<P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>Ladies and Gentlemen: </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>Reference is made to that certain
Securities Purchase Agreement, dated as of May XX, 2007 (the
<B>&#147;Agreement&#148;</b>), by and among Silicom Ltd., an Israeli corporation (the
&#147;<B>Company</b>&#148;), and the investors named on the Schedule of Investors attached
thereto (collectively, the &#147;<B>Holders&#148;</b>), pursuant to which the Company is
issuing to the Holders ordinary shares (the &#147;<B>Shares</b>&#148;) of the Company, par
value NIS 0.01 per share (the &#147;<B>Ordinary Shares</b>&#148;), and Warrants (the
&#147;<B>Warrants</b>&#148;), which are exercisable into Ordinary Shares. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This
letter shall serve as our irrevocable authorization and direction to you (provided that
you are the transfer agent of the Company at such time): </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)
 to issue Ordinary Shares upon transfer or resale of the Shares; and </font></p>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp;
to issue Ordinary Shares upon the exercise of the Warrants (the &#147;<B>Warrant
Shares</b>&#148;) to or upon the order of a Holder from time to time upon delivery to you
of a properly completed and duly executed Exercise Notice, in the form attached hereto as
<U>Exhibit&nbsp;I</u>, which has been acknowledged by the Company as indicated by the
signature of a duly authorized officer of the Company thereon. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;You
acknowledge and agree that so long as you have previously received (a)&nbsp;written
confirmation from the Company&#146;s legal counsel that either (i)&nbsp;a registration
statement covering resales of the Shares and the Warrant Shares has been declared
effective by the Securities and Exchange Commission (the &#147;<B>SEC</b>&#148;) under the
Securities Act of 1933, as amended (the &#147;<B>1933 Act</b>&#148;) and that resales of
the Shares and the Warrant Shares may be made thereunder, or (ii)&nbsp;sales of the Shares
and the Warrant Shares may be made in conformity with Rule&nbsp;144(k) under the 1933 Act
(&#147;<B>Rule&nbsp;144(k)</b>&#148;) and (b)&nbsp;if applicable, a copy of such
registration statement, then, unless otherwise required by law, within three (3) business
days of your receipt of the request from a Holder and the items referred to in (a) and
(b), as applicable, you shall issue the certificates representing the Shares and the
Warrant Shares, which certificates shall not bear any legend restricting transfer of the
Shares and the Warrant Shares thereby and should not be subject to any stop-transfer
restriction. You acknowledge and agree that so long as you have previously received notice
(accompanied by a legal opinion) from legal counsel to the Company or any Holder that a
transfer of Shares and/or Warrant Shares has been effected pursuant to Rule&nbsp;144 then,
unless otherwise required by law, within three (3) business days of your receipt such
notice (accompanied by a legal opinion) you shall issue the certificates representing the
Shares and the Warrant Shares, which certificates shall not bear any legend restricting
transfer of the Shares and the Warrant Shares thereby and should not be subject to any
stop-transfer restriction. </font></p>

<p align=center>
<font size=2></font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A
form of written confirmation (to be used in connection with any sale) from the
Company&#146;s outside legal counsel that a registration statement covering resales of the
Shares and the Warrant Shares has been declared effective by the SEC under the 1933 Act is
attached hereto as <U>Exhibit&nbsp;II</u>. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Please
be advised that the Holders are relying upon this letter as an inducement to enter into
the Agreement and, accordingly, each Holder is a third party beneficiary to these
instructions. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Please
execute this letter in the space indicated to acknowledge your agreement to act in
accordance with these instructions. Should you have any questions concerning this matter,
please contact me at +972-9-764-4555. </font></p>

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<Table Width=100% Cellspacing=0 Cellpadding=0 Border=0>
<tr Valign=TOP>
<td Width=40%><Font Face="Times New Roman, Times, Serif" Size=2></font></td>
<td Width=10%><Font Face="Times New Roman, Times, Serif" Size=2></font></td>
<td Width=50%><Font Face="Times New Roman, Times, Serif" Size=2>Very truly yours,<Br><Br>SILICOM LTD.<Br><Br>
<br>By: <br>&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;<br>
Name:<br>Title:</font></td>
</tr>
</table>
<br>


<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>THE FOREGOING INSTRUCTIONS ARE
<Br>ACKNOWLEDGED AND AGREED TO
<Br>this      day of ___________, 2007
</FONT></P>

<P><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><B>AMERICAN STOCK TRANSFER &amp; TRUST COMPANY</B> </FONT></P>


<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH></TR>
<TR VALIGN=Bottom>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH></TR>
<TR VALIGN=Bottom>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH></TR>
<TR VALIGN=Bottom>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH></TR>
<TR VALIGN=Bottom>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=5% ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=95% ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>By: _________________________</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Name: ____________________</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Title: _____________________</FONT></TD></TR>
</TABLE>
<Br>


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<P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>Enclosures </font></p>

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<font size=2></font></p>
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<!-- MARKER FORMAT-SHEET="Head Major Center Bold 1-TNR" FSL="Workstation" -->
<H1 Align=CENTER><Font Face="Times New Roman, Times, Serif" Size=2>Exhibit&nbsp;F </font></h1>

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<H1 Align=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><U>FORM OF WARRANT</U> </FONT> </h1>

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<font size=2></font></p>
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</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99
<SEQUENCE>3
<FILENAME>exhibit_99-2.htm
<TEXT>
<HTML>
<HEAD>
     <!-- Created by EDGAR Ease Plus (EDGAR Ease+) -->
     <!-- Project:        \\Backup\office\EDGAR Filing\Silicom Ltd\73702\a73702.eep        -->
     <!-- Control Number: 73702                                                            -->
     <!-- Rev Number:     1                                                                -->
     <!-- Client Name:    Silicom Ltd                                                      -->
     <!-- Project Name:   6-K                                                              -->
     <!-- Firm Name:      Zadok-Keinan Ltd                                                 -->
     <TITLE>6-K</TITLE>
</HEAD>
<BODY>

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<Hr Align=LEFT Width=100% Size=4 Noshade Style="margin-top: -5px">
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<P Align="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><U><B>Exhibit 99.2</B></U> </FONT> </P>

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<H1 Align=CENTER><Font Face="Times New Roman, Times, Serif" Size=2>SECURITIES PURCHASE
AGREEMENT </font></h1>

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<P><Font Face="Times New Roman, Times, Serif" Size=2><B>THIS SECURITIES PURCHASE
AGREEMENT</b> (the &#147;<B>Agreement</b>&#148;), dated as of May 3, 2007, by and among
Silicom Ltd., an Israeli corporation with headquarters located at 8 Hanagar Street, Kfar
Sava 44000, Israel (the &#147;<B>Company</b>&#148;), and CD Investment Partners, Ltd. (the
&#147;<B>Investor</b>&#148;). </font></p>

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<H1 Align=CENTER><Font Face="Times New Roman, Times, Serif" Size=2>BACKGROUND </font></h1>

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     <P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;A.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          The Company and the Investor are executing and delivering this Agreement in
          reliance upon the exemption from registration afforded by Section&nbsp;4(2) of
          the Securities Act of 1933, as amended (the &#147;<B>Securities Act</b>&#148;),
          and Rule&nbsp;506 of Regulation D (&#147;<B>Regulation D</b>&#148;) as
          promulgated by the United States Securities and Exchange Commission (the
          &#147;<B>SEC</b>&#148;) under the Securities Act. </font></p>

<!-- MARKER FORMAT-SHEET="Para (List) Indent Lv 0- TNR" FSL="Workstation" -->
     <P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;B.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          The Investor wishes to purchase, and the Company wishes to sell, upon the terms
          and conditions stated in this Agreement, ordinary shares, par value NIS 0.01 per
          share, of the Company, (the &#147;<B>Ordinary Shares</b>&#148;) and
          a&nbsp;warrant, in substantially the form attached hereto as <U>Exhibit E</u>
          (the &#147;<B>Warrant</b>&#148;) to acquire up to 8,750 additional Ordinary
          Shares (the Ordinary Shares issuable to the Investor upon exercise of or
          otherwise pursuant to the Warrant, collectively, the &#147;<B>Warrant
          Shares</b>&#148;). </font></p>

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     <P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;C.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          The Shares, the Warrant and the Warrant Shares issued pursuant to this Agreement
          are collectively referred to herein as the &#147;<B>Securities</b>.&#148; </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;NOW,
THEREFORE, IN CONSIDERATION of the mutual covenants contained in this Agreement, and for
other good and valuable consideration the receipt and adequacy of which are hereby
acknowledged, the Company and the Investor agree as follows: </font></p>

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<P Align="Center"><Font Face="Times New Roman, Times, Serif" Size=2>ARTICLE I </font><Br>
<Font Face="Times New Roman, Times, Serif" Size=2>DEFINITIONS </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.1
     <U>Definitions</u>.  In addition to the terms  defined  elsewhere in this  Agreement,  the
following terms have the meanings indicated: </font></p>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>6-K
Filing</b>&#148; has the meaning set forth in <U>Section 4.5</u>. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Affiliate</b>&#148;
means any Person that, directly or indirectly through one or more intermediaries, controls
or is controlled by or is under common control with a Person, as such terms are used in
and construed under Rule&nbsp;144 under the Securities Act. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Agents</b>&#148;
has the meaning set forth in <U>Section 3.1(l)</u>. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Agreement</b>&#148;
has the meaning set forth in the Preamble. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Best
Efforts</b>&#148; means the efforts that a prudent person desirous of achieving a result
would use in similar circumstances to ensure that such result is achieved as expeditiously
as practical; <U>provided</u>, <U>however</u>, that an obligation to use Best Efforts
under this Agreement does not require the Company to dispose of or make any change to its
business, expend any material funds or incur any other material burden. </font></p>

<p align=center>
<font size=2></font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Business
Day</b>&#148; means any day other than Saturday, Sunday or other day on which commercial
banks in the City of New York or in the State of Israel are authorized or required by law
to remain closed. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Closing</b>&#148;
means the closing of the purchase and sale of the Shares and the Warrant pursuant to
<U>Section&nbsp;2.1</u>. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Closing
Date</b>&#148; means the date and time of the Closing and shall be on such date and time
as is mutually agreed to by the Company and the Investor. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Closing
Price</b>&#148; means, for any date, the closing price per Ordinary Share for such date
(or the nearest preceding date) on the Nasdaq Capital Market or, if the Ordinary Shares
are not listed on the Nasdaq Capital Market, on the primary Eligible Market or exchange or
quotation system on which the Ordinary Shares is then listed or quoted. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>&#147;Company&#148;
</b>has the meaning set forth in the Preamble. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Company
Counsel</b>&#148; means Yigal Arnon &amp; Co., counsel to the Company. </font></p>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Disclosure
Materials</b>&#148; has the meaning set forth in <U>Section&nbsp;3.1(g)</u>. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Effective
Date</b>&#148; means the date that the Registration Statement is first declared effective
by the SEC. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Effectiveness
Period</b>&#148; has the meaning set forth in <U>Section&nbsp;6.1(b)</u>. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Eligible
Market</b>&#148; means any of the New York Stock Exchange, the American Stock Exchange,
The Nasdaq Global Select Market, The Nasdaq Global Market or the OTC<Sup>&reg;</sup>
Bulletin Board. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Environmental
Laws</b>&#148; has the meaning set forth in <U>Section 3.1(dd)</u>. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Event</b>&#148;
has the meaning set forth in <U>Section&nbsp;6.1(d)</u>. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Event
Payments</b>&#148; has the meaning set forth in <U>Section&nbsp;6.1(d)</u>. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Exchange
Act</b>&#148; means the Securities Exchange Act of 1934, as amended. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Excluded Events</b>&#148;
has the meaning set forth in <U>Section&nbsp;6.1(d)(ii)</u>. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Filing
Date</b>&#148; means thirty-five (35) days after the Closing Date. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>GAAP</b>&#148;
has the meaning set forth in <U>Section 3.1(g)</u>. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Hazardous
Materials</b>&#148; has the meaning set forth in <U>Section 3.1(dd)</u>. </font></p>

<p align=center>
<font size=2>2</font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Indebtedness</b>&#148;
has the meaning set forth in <U>Section 3.1(aa)</u>. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Indemnified
Party</b>&#148; has the meaning set forth in <U>Section&nbsp;6.4(c)</u>. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Indemnifying
Party</b>&#148; has the meaning set forth in <U>Section&nbsp;6.4(c)</u>. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Insolvent</b>&#148;
has the meaning set forth in <U>Section 3.1(h)</u>. </font></p>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Intellectual
Property</b>&#148; has the meaning set forth in <U>Section&nbsp;3.1(t)</u>. </font></p>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Investor</b>&#148;
has the meanings set forth in the Preamble.<U></u> </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Lien</b>&#148;
means any lien, charge, claim, security interest, encumbrance, right of first refusal or
other restriction. </font></p>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Losses</b>&#148;
means any and all losses, claims, damages, liabilities, settlement costs and expenses,
including, without limitation, reasonable attorneys&#146; fees. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Material
Adverse Effect</b>&#148; means (i) a material adverse effect on the results of operations,
assets, business, or financial condition of the Company and the Subsidiaries, taken as a
whole on a consolidated basis, or (ii)&nbsp;a material and adverse impairment of the
Company&#146;s ability to perform its obligations under any of the Transaction Documents;
<U>provided</u>, that none of the following alone shall be deemed, in and of itself, to
constitute a Material Adverse Effect: (i) a change in the market price or trading volume
of the Ordinary Shares or other securities of the Company or (ii) changes in general
economic conditions or changes affecting the industry in which the Company operates
generally (as opposed to Company-specific changes) so long as such changes do not have a
disproportionate effect on the Company and its Subsidiaries taken as a whole. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Material
Permits</b>&#148; has the meaning set forth in <U>Section&nbsp;3.1(v)</u>. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Ordinary Shares</b>&#148;
has the meaning set forth in the preamble. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>&#147;Person</b>&#148;
means any individual or corporation, partnership, trust, incorporated or unincorporated
association, joint venture, limited liability company, or joint stock company. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Proceeding</b>&#148;
means an action, claim, suit, investigation or proceeding (including, without limitation,
a partial proceeding, such as a deposition), whether commenced or threatened in writing. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Prospectus</b>&#148;
means the prospectus included in the Registration Statement (including, without
limitation, a prospectus that includes any information previously omitted from a
prospectus filed as part of an effective registration statement in reliance upon Rule 430A
promulgated under the Securities Act), as amended or supplemented by any prospectus
supplement, with respect to the terms of the offering of any portion of the Registrable
Securities covered by the Registration Statement, and all other amendments and supplements
to the Prospectus including post-effective amendments, and all material incorporated by
reference or deemed to be incorporated by reference in such Prospectus. </font></p>

<p align=center>
<font size=2>3</font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Registrable
Securities</b>&#148; means the Shares and the Warrant Shares issued or issuable pursuant
to the Transaction Documents, together with any securities issued or issuable upon any
stock split, dividend or other distribution, recapitalization or similar event with
respect to the foregoing. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Registration
Statement</b>&#148; means each registration statement required to be filed under
Article&nbsp;VI, including (in each case) any preliminary prospectus, the Prospectus,
amendments and supplements to such registration statement or Prospectus, including pre-
and post-effective amendments, any free-writing prospectus, all exhibits thereto, and all
material incorporated by reference or deemed to be incorporated by reference in such
registration statement. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Regulation
D</b>&#148; has the meaning set forth in the Preamble. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Required
Effectiveness Date</b>&#148; means the date which is the earliest of (i) if the
Registration Statement does not become subject to review by the SEC, the earliest of (a)
ninety (90) days after the Closing Date and (b) five (5) Trading Days after the Company
receives notification from the SEC that the Registration Statement will not become subject
to review and the Company fails to request the acceleration of the effectiveness of the
Registration Statement; <U>provided</u>, that in the opinion of counsel to the Company a
pre-effective amendment to the Registration Statement is not required under the Securities
Act or (ii) if the Registration Statement becomes subject to review by the SEC, one
hundred and fifty (150) days after the Closing Date. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Rule&nbsp;144</b>,&#148;
&#147;<B>Rule&nbsp;415</b>,&#148; and &#147;<B>Rule&nbsp;424</b>&#148; means
Rule&nbsp;144, Rule&nbsp;415 and Rule&nbsp;424, respectively, promulgated by the SEC
pursuant to the Securities Act, as such Rules may be amended from time to time, or any
similar rule or regulation hereafter adopted by the SEC having substantially the same
effect as such Rule. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>&#147;SEC&#148;</b>
has the meaning set forth in the Preamble. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>SEC
Reports</b>&#148; has the meaning set forth in <U>Section&nbsp;3.1(g)</u>. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Securities</b>&#148;
has the meaning set forth in the Preamble. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Securities
Act</b>&#148; has the meaning set forth in the Preamble. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Shares</b>&#148;
means 35,000 of the Company&#146;s Ordinary Shares offered hereby to be purchased by the
Investor at the Closing. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Short
Sales</b>&#148; has the meaning set forth in <U>Section 3.2(h)</u>. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Subsidiary</b>&#148;
means any direct or indirect subsidiary of the Company. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Trading
Day</b>&#148; means (a)&nbsp;any day on which the Ordinary Shares are listed or quoted and
traded on its primary Trading Market, (b)&nbsp;if the Ordinary Shares are not then listed
or quoted and traded on any Eligible Market, then a day on which trading occurs on The
Nasdaq Global Market (or any successor thereto), or (c)&nbsp;if trading ceases to occur on
The Nasdaq Global Market (or any successor thereto), any Business Day. </font></p>

<p align=center>
<font size=2>4</font></p>
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<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Trading
Market</b>&#148; means the Nasdaq Capital Market or any other Eligible Market, or any
national securities exchange, market or trading or quotation facility on which the
Ordinary Shares are listed or quoted. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>&#147;Transaction
Documents</b>&#148; means this Agreement, the schedules and exhibits attached hereto, the
Warrant and the Transfer Agent Instructions. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Transfer
Agent</b>&#148; means American Stock Transfer &amp; Trust Company, or any successor
transfer agent for the Company. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Transfer
Agent Instructions</b>&#148; means, with respect to the Company, the Irrevocable Transfer
Agent Instructions, in the form of <U>Exhibit&nbsp;D</u>, executed by the Company and
delivered to and acknowledged in writing by the Transfer Agent. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>&#147;Warrant</b>&#148;
has the meaning set forth in the Preamble. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<B>Warrant
Shares</b>&#148; has the meaning set forth in the Preamble. </font></p>

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<P Align="Center"><Font Face="Times New Roman, Times, Serif" Size=2>ARTICLE II </font><Br>
<Font Face="Times New Roman, Times, Serif" Size=2>PURCHASE AND SALE </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1
<U>Closing</u>. Subject to the terms and conditions set forth in this Agreement, at the
Closing the Company shall issue and sell to the Investor, and the Investor shall purchase
from the Company, the Shares and Warrant. The date and time of the Closing shall be 11:00
a.m., New York City Time, on the Closing Date. The Closing shall take place at the
offices of the Morrison &amp; Foerster LLP, 1290 Avenue of the Americas, New York, New
York 10104.  </font></p>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2
<U>Closing Deliveries</u>.  </font></p>


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<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)
                    At the Closing, the Company shall deliver or cause to be delivered to
the                     Investor the following:  </font>
</td>
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</table>
<br>

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<td Width=10%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)
                    one or more stock certificates (or copies thereof provided by the
Transfer                     Agent), free and clear of all restrictive and other legends
(except as expressly                     provided in <U>Section&nbsp;4.1(b</u>) hereof),
evidencing the Shares registered                     in the name of the Investor;  </font>
</td>
</tr>
</table>
<br>

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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
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<td Width=10%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)
                    the Warrant, issued in the name of the Investor, pursuant to which
the Investor                     shall have the right to acquire the Warrant Shares;  </font>
</td>
</tr>
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<tr Valign=TOP>
<td Width=10%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)
                    a legal opinion of Company Counsel, in the form of <U>Exhibit&nbsp;B</u>,
                    executed by such counsel and delivered to the Investor;  </font>
</td>
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</table>
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<td Width=10%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv)
                    a certificate executed by the chief executive officer and the chief
financial or                     accounting officer of the Company, dated as of the
Closing Date, to the effect                     that the representations and warranties
of the Company set forth herein are true                     and correct as of the date
of this Agreement and as of such Closing Date and                     that the Company
has complied with all the agreements and satisfied all the                     conditions
herein on its part to be performed or satisfied on or prior to such
                    Closing Date;  </font>
</td>
</tr>
</table>
<br>

<p align=center>
<font size=2>5</font></p>
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<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>


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<td Width=10%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v)
                    duly executed Transfer Agent Instructions acknowledged by the Company&#146;s
                    transfer agent; and  </font>
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</table>
<br>

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<td Width=10%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi)
                    proof of delivery to each applicable Trading Market of an additional
shares                     listing application covering all of the Registrable
Securities.  </font>
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<br>

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<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)
                    At the Closing, the Investor shall deliver or cause to be delivered
to the                     Company $717,500 (the <B>&#147;Purchase Price&#148;</b>) in
United States                     dollars and in immediately available funds, by wire
transfer to an account                     designated in writing to the Investor by the
Company for such purpose.  </font>
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<br>

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<P Align="Center"><Font Face="Times New Roman, Times, Serif" Size=2>ARTICLE III </font><Br>
<Font Face="Times New Roman, Times, Serif" Size=2>REPRESENTATIONS AND
WARRANTIES </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.1
<U>Representations and Warranties of the Company</u>. The Company hereby represents and
warrants to the Investor as follows (which representations and warranties shall be deemed
to apply, where appropriate, to each Subsidiary of the Company):  </font></p>


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<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)
<U>Subsidiaries</u>. The Company has no Subsidiaries other than those listed in <U>Schedule&nbsp;3.1(a</u>)
hereto. Except as disclosed in <U>Schedule&nbsp;3.1(a</u>) hereto, the Company owns,
directly or indirectly,                     all of the capital stock or comparable equity
interests of each Subsidiary free                     and clear of any Lien and all the
issued and outstanding shares of capital stock                     or comparable equity
interest of each Subsidiary are validly issued and are                     fully paid,
non-assessable and free of preemptive and similar rights.  </font>
</td>
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</table>
<br>

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<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)
<U>Organization and Qualification</u>. Each of the Company and the Subsidiaries
                    is an entity duly organized, validly existing and in good standing
under the                     laws of the jurisdiction of its incorporation or
organization (as applicable),                     with the requisite legal authority to
own and use its properties and assets and                     to carry on its business as
currently conducted. Neither the Company nor any                     Subsidiary is in
violation of any of the provisions of its respective                     certificate or
articles of incorporation, bylaws or other organizational or                     charter
documents. Each of the Company and the Subsidiaries is duly qualified to
                    do business and is in good standing as a foreign corporation or other
entity in                     each jurisdiction in which the nature of the business
conducted or property                     owned by it makes such qualification necessary,
except where the failure to be                     so qualified or in good standing, as
the case may be, would not, individually or                     in the aggregate, have or
reasonably be expected to result in a Material Adverse                     Effect.  </font>
</td>
</tr>
</table>
<br>

<p align=center>
<font size=2>6</font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>


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<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)
<U>Authorization; Enforcement</u>. The Company has the requisite corporate
                    authority to enter into and to consummate the transactions
contemplated by each                     of the Transaction Documents to which it is a
party and otherwise to carry out                     its obligations hereunder and
thereunder. The execution and delivery of each of                     the Transaction
Documents to which it is a party by the Company and the                     consummation
by it of the transactions contemplated hereby and thereby have been
                    duly authorized by all necessary corporate action on the part of the
Company and                     no further consent or action is required by the Company,
its Board of Directors                     or its stockholders. Each of the Transaction
Documents to which it is a party                     has been (or upon delivery will be)
duly executed by the Company and is, or when                     delivered in accordance
with the terms hereof and thereof, will constitute, the                     valid and
binding obligation of the Company enforceable against the Company in
                    accordance with its terms, except as may be limited by (i)&nbsp;applicable
                    bankruptcy, insolvency, reorganization or other laws of general
application                     relating to or affecting the enforcement of creditors
rights generally, and                     (ii)&nbsp;the effect of rules of law governing
the availability of specific                     performance and other equitable
remedies.  </font>
</td>
</tr>
</table>
<br>

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<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)
<U>No Conflicts</u>. The execution, delivery and performance by the Company of
                    the Transaction Documents to which it is a party and the consummation
by the                     Company of the transactions contemplated hereby and thereby do
not, and will                     not, (i)&nbsp;conflict with or violate any provision of
the Company&#146;s or                     any Subsidiary&#146;s certificate or articles
of incorporation, bylaws or other                     organizational or charter
documents, (ii)&nbsp;conflict with, or constitute a                     default (or an
event that with notice or lapse of time or both would become a
                    default) under, or give to others any rights of termination,
amendment,                     acceleration or cancellation (with or without notice,
lapse of time or both) of,                     any agreement, credit facility, debt or
other instrument (evidencing a Company                     or Subsidiary debt or
otherwise) or other understanding to which the Company or                     any
Subsidiary is a party or by which any property or asset of the Company or
                    any Subsidiary is bound or affected, except to the extent that such
conflict,                     default, termination, amendment, acceleration or
cancellation right would not                     reasonably be expected to have a
Material Adverse Effect, or (iii) except as set                     forth on Schedule
3.1(d), result in a violation of any law, rule, regulation,                     order,
judgment, injunction, decree or other restriction of any court,
                    arbitrator or governmental authority to which the Company or a
Subsidiary is                     subject (including, assuming the accuracy of the
representations and warranties                     of the Investor set forth in <U>Section
3.2</u> hereof, federal and state                     securities laws and regulations and
the rules and regulations of any                     self-regulatory organization to
which the Company or its securities are subject,                     including all
applicable Trading Markets), or by which any property or asset of                     the
Company or a Subsidiary is bound or affected, except to the extent that such
                    violation would not reasonably be expected to have a Material Adverse
Effect.  </font>
</td>
</tr>
</table>
<br>

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<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)
<U>Securities</u>. The Securities (including the Warrant Shares) are duly
                    authorized and, when issued and paid for in accordance with the
Transaction                     Documents, will be duly and validly issued, fully paid
and nonassessable, free                     and clear of all Liens and will not be
subject to preemptive or similar rights                     of shareholders (other than
those imposed by the Investor). The Company has                     reserved from its
duly authorized capital stock the maximum number of Ordinary                     Shares
issuable upon exercise of the Warrant. Assuming the accuracy of the
                    representations and warranties of the Investor set forth in <U>Section&nbsp;3.2</u>,
the offer, issuance and sale of the Shares and the                     Warrant to the
Investor pursuant to the Agreement, and in the case of the                     Warrant
Shares, pursuant to the Warrant, are exempt from the registration
                    requirements of the Securities Act.  </font>
</td>
</tr>
</table>
<br>

<p align=center>
<font size=2>7</font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>


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<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)
<U>Capitalization</u>. The aggregate number of shares and type of all
                    authorized, issued and outstanding classes of capital stock, options
and other                     securities of the Company (whether or not presently
convertible into or                     exercisable or exchangeable for shares of capital
stock of the Company) is set                     forth in <U>Schedule&nbsp;3.1(f</u>)
hereto. All outstanding shares of capital                     stock are duly authorized,
validly issued, fully paid and nonassessable and have                     been issued in
compliance in all material respects with all applicable                     securities
laws. Except as disclosed in <U>Schedule&nbsp;3.1(f</u>) hereto, the
                    Company did not have outstanding at March&nbsp;31, 2007 any other
options,                     warrants, script rights to subscribe to, calls or
commitments of any character                     whatsoever relating to, or securities,
rights or obligations convertible into or                     exercisable or exchangeable
for, or entered into any agreement giving any Person                     any right to
subscribe for or acquire, any Ordinary Shares or securities or                     rights
convertible or exchangeable into Ordinary Shares. Except as set forth on <U>Schedule </u><U>3.1(f</u>)
hereto, and except for customary adjustments as a                     result of stock
dividends, stock splits, combinations of shares,                     reorganizations,
rights offerings, cash dividends, recapitalizations,
                    reclassifications or other similar events, there are no anti-dilution
or price                     adjustment provisions contained in any security issued by
the Company (or in any                     agreement providing rights to security
holders) and the issuance and sale of the                     Securities will not
obligate the Company to issue Ordinary Shares or other                     securities to
any Person (other than the Investor) and will not result in a                     right
of any holder of securities to adjust the exercise, conversion, exchange
                    or reset price under such securities. To the knowledge of the
Company, except as                     disclosed in the SEC Reports and any Schedules
filed with the SEC pursuant to                     Rule 13d-1 of the Exchange Act by
reporting persons or in <U>Schedule </u><U>3.1(f</u>) hereto, no Person or group of
related Persons beneficially owns                     (as determined pursuant to Rule
13d-3 under the Exchange Act), or has the right                     to acquire, by
agreement with or by obligation binding upon the Company,                     beneficial
ownership of in excess of 5% of the outstanding Ordinary Shares.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g)
<U>SEC Reports</u>. Except as set forth on <U>Schedule 3.1(g)</u>, the Company
                    has filed all reports required to be filed by it under the Exchange
Act,                     including pursuant to Section&nbsp;13(a) or 15(d) thereof, for
the twelve (12)                     months preceding the date hereof on a timely basis or
has received a valid                     extension of such time of filing and has filed
any such SEC Reports prior to the                     expiration of any such extension
and has filed all reports required to be filed                     by it under the
Exchange Act, including pursuant to Section 13(a) or 15(d)                     thereof,
for the two (2) years preceding the date hereof. Such reports required
                    to be filed by the Company under the Exchange Act, including pursuant
to Section                     13(a) or 15(d) thereof, together with any materials filed
or furnished by the                     Company under the Exchange Act, whether or not
any such reports were required                     being collectively referred to herein
as the <B>&#147;SEC Reports</b>&#148; and,                     together with this
Agreement and the <U>Schedules</u> to this Agreement, the <B>&#147;Disclosure Materials</b>&#148;.
As of their respective dates (or if                     amended or superseded by a filing
prior to the date hereof, then on the date of                     such filing), the SEC
Reports filed by the Company complied in all material                     respects with
the requirements of the Securities Act and the Exchange Act and                     the
rules and regulations of the SEC promulgated thereunder, and none of the SEC
                    Reports, when filed by the Company (or if amended or superseded by a
filing                     prior to the date hereof, then on the date of such filing),
contained any untrue                     statement of a material fact or omitted to state
a material fact required to be                     stated therein or necessary in order
to make the statements therein, in the                     light of the circumstances
under which they were made, not misleading. The                     financial statements
of the Company included in the SEC Reports comply in all                     material
respects with applicable accounting requirements and the rules and
                    regulations of the SEC with respect thereto as in effect at the time
of filing                     (or if amended or superseded by a filing prior to the date
hereof, then on the                     date of such filing). Such financial statements
have been prepared in accordance                     with United States generally
accepted accounting principles applied on a                     consistent basis during
the periods involved (&#147;<B>GAAP</b>&#148;), except                     as may be
otherwise specified in such financial statements, the notes thereto
                    and except that unaudited financial statements may not contain all
footnotes                     required by GAAP or may be condensed or summary statements,
and fairly present                     in all material respects the consolidated
financial position of the Company and                     its consolidated Subsidiaries
as of and for the dates thereof and the results of                     operations and
cash flows for the periods then ended, subject, in the case of
                    unaudited statements, to normal, year-end audit adjustments. All
material                     agreements to which the Company or any Subsidiary is a party
or to which the                     property or assets of the Company or any Subsidiary
are subject are included as                     part of or identified in the SEC Reports,
to the extent such agreements are                     required to be included or
identified pursuant to the rules and regulations of                     the SEC.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h)
<U>Financial Statements</u>. Since the date of the latest audited financial
                    statements included within the SEC Reports, except as disclosed in
the SEC                     Reports or in <U>Schedule 3.1(h) </u> hereto, (i)&nbsp;there
has been no event,                     occurrence or development that, individually or in
the aggregate, has had or                     that would result in a Material Adverse
Effect, (ii)&nbsp;the Company has not                     incurred any material
liabilities other than (A)&nbsp;trade payables and accrued                     expenses
incurred in the ordinary course of business consistent with past
                    practice and (B)&nbsp;liabilities not required to be reflected in the
                    Company&#146;s financial statements pursuant to GAAP or required to
be disclosed                     in filings made with the SEC, (iii)&nbsp;the Company has
not altered its method                     of accounting or changed its auditors, except
as disclosed in its SEC Reports,                     (iv)&nbsp;the Company has not
declared or made any dividend or distribution of                     cash or other
property to its stockholders, in their capacities as such, or
                    purchased, redeemed or made any agreements to purchase or redeem any
shares of                     its capital stock (except for repurchases by the Company of
shares of capital                     stock held by employees, officers, directors, or
consultants pursuant to an                     option of the Company to repurchase such
shares upon the termination of                     employment or services), and (v)&nbsp;the
Company has not issued any equity                     securities to any officer, director
or Affiliate, except pursuant to existing                     Company stock-based plans
or other arrangements. The Company has not taken any                     steps to seek
protection pursuant to any bankruptcy law nor does the Company                     have
any knowledge or reason to believe that its creditors intend to initiate
                    involuntary bankruptcy proceedings or any actual knowledge of any
fact which                     would reasonably lead a creditor to do so. The Company is
not as of the date                     hereof, and after giving effect to the
transactions contemplated hereby to occur                     at the applicable Closing,
will not be Insolvent (as defined below). For                     purposes of this <U>Section
3.1(h)</u>, &#147;<B>Insolvent</b>&#148; means (i)                     the Company is
unable to pay its debts and liabilities, subordinated, contingent                     or
otherwise, as such debts and liabilities become absolute and matured, (ii)
                    the Company intends to incur or believes that it will incur debts
that would be                     beyond its ability to pay as such debts mature or (iii)
the Company has                     unreasonably small capital with which to conduct the
business in which it is                     engaged as such business is now conducted and
is proposed to be conducted.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)
<U>Absence of Litigation</u>. Except as disclosed in the SEC Reports or in <U>Schedule
3.1(i)</u>, there is no action, suit, claim, or Proceeding, or, to
                    the Company&#146;s knowledge, inquiry or investigation, before or by
any court,                     public board, government agency, self-regulatory
organization or body pending                     or, to the knowledge of the Company,
threatened against or affecting the Company                     or any of its
Subsidiaries that could, individually or in the aggregate, have a
                    Material Adverse Effect.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j)
<U>Compliance</u>. Except as described in <U>Schedule 3.1(j)</u>, neither the
                    Company nor any Subsidiary, except in each case as would not,
individually or in                     the aggregate, reasonably be expected to have or
result in a Material Adverse                     Effect, (i)&nbsp;is in default under or
in violation of (and no event has                     occurred that has not been waived
that, with notice or lapse of time or both,                     would result in a default
by the Company or any Subsidiary under), nor has the                     Company or any
Subsidiary received written notice of a claim that it is in                     default
under or that it is in violation of, any indenture, loan or credit
                    agreement or any other agreement or instrument to which it is a party
or by                     which it or any of its properties is bound (whether or not such
default or                     violation has been waived), (ii)&nbsp;is in violation of
any order of any court,                     arbitrator or governmental body, or (iii)&nbsp;is
or has been in violation of                     any law, statute, rule or regulation of
any governmental authority.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(k)
<U>Title to Assets</u>. The Company and the Subsidiaries have good and
                    marketable title to all real property owned by them that is material
to the                     business of the Company and the Subsidiaries and good and
marketable title in                     all personal property owned by them that is
material to the business of the                     Company and the Subsidiaries, in each
case free and clear of all Liens, except                     for Liens that do not,
individually or in the aggregate, have or result in a                     Material
Adverse Effect. Any real property and facilities held under lease by
                    the Company and the Subsidiaries are held by them under valid,
subsisting and                     enforceable leases of which the Company and the
Subsidiaries are in material                     compliance.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(l)
<U>No General Solicitation; Placement Agents&#146; Fees</u>. Neither the Company
                    nor any of its Affiliates, nor any Person acting on its or their
behalf, has                     engaged in any form of general solicitation or general
advertising (within the                     meaning of Regulation&nbsp;D) in connection
with the offer or sale of the                     Securities. The Company shall be
responsible for the payment of any placement                     agent&#146;s fees,
financial advisory fees, or brokers&#146; commission (other                     than for
persons engaged by the Investor or its investment advisor) relating to
                    or arising out of the issuance of the Securities pursuant to this
Agreement. The                     Company shall pay, and hold the Investor harmless
against, any liability, loss                     or expense (including, without
limitation, reasonable attorney&#146;s fees and                     out-of-pocket
expenses) arising in connection with any such claim for fees                     arising
out of the issuance of the Securities pursuant to this Agreement. The
                    Company acknowledges that it has engaged Cowen and Company, LLC and
W.R.                     Hambrecht + Co., LLC as its exclusive placement agents (the <B>&#147;Agents</b>&#148;)
in connection with the sale of the Securities. Other                     than the Agents,
the Company has not engaged any placement agent or other agent                     in
connection with the sale of the Securities.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(m)
<U>Private Placement</u>. Neither the Company nor any of its Affiliates nor, any
                    Person acting on the Company&#146;s behalf has, directly or
indirectly, at any                     time within the past six (6) months, made any
offer or sale of any security or                     solicitation of any offer to buy any
security under circumstances that would                     (i)&nbsp;eliminate the
availability of the exemption from registration under                     Regulation&nbsp;D
under the Securities Act in connection with the offer and sale                     by the
Company of the Securities as contemplated hereby or (ii)&nbsp;cause the
                    offering of the Securities pursuant to the Transaction Documents to
be                     integrated with prior offerings. Assuming the accuracy of the
representations                     and warranties of the Investor, the offer and sale of
the Securities by the                     Company to the Investor pursuant to this
Agreement will be exempt from the                     registration requirements of the
Securities Act. The Company is not required to                     be registered as, and
is not an Affiliate of, an &#147;investment company&#148;                    within the
meaning of the Investment Company Act of 1940, as amended. The
                    Company is not required to be registered as, a United States real
property                     holding corporation within the meaning of the Foreign
Investment in Real                     Property Tax Act of 1980.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(n)
<U>Form F-3 Eligibility</u>. The Company is eligible to register the Shares and
                    the Warrant Shares for resale by the Investor using a registration
statement on                     Form F-3.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(o)
<U>Listing and Maintenance Requirements</u>. The Company has not, in the twelve
                    (12) months preceding the date hereof, received notice (written or
oral) from                     the Trading Market on which the Ordinary Shares are or
have been listed or                     quoted to the effect that the Company is not in
compliance with the listing or                     maintenance requirements of the
Trading Market. The Company is in compliance                     with all such listing
and maintenance requirements as they apply to the Company.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(p)
<U>Registration Rights</u>. Except as described in <U>Schedule 3.1(p)</u>, the
                    Company has not granted or agreed to grant to any Person any rights
(including                     &#147;piggy-back&#148; registration rights) to have any
securities of the                     Company registered with the SEC or any other
governmental authority that have                     not been satisfied or waived.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(q)
<U>Application of Takeover Protections</u>. Except as described in <U>Schedule
                    3.1(q)</u> or the SEC Reports, there are no control share
acquisition, business                     combination, poison pill (including any
distribution under a rights agreement)                     or other similar anti-takeover
provision under the Company&#146;s charter                     documents or the laws of
its state of incorporation that is or could become                     applicable to the
Investor as a result of the Investor and the Company                     fulfilling their
obligations or exercising their rights under the Transaction
                    Documents, including, without limitation, as a result of the Company&#146;s
                    issuance of the Securities and the Investor&#146;s ownership of the
Securities.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(r)
<U>Disclosure</u>. The Company confirms that following the filing of the 6-K
                    Filing, neither it nor any officers, directors or Affiliates, will
have provided                     the Investor or their agents or counsel with any
information that constitutes or                     might constitute material, nonpublic
information (other than the existence and                     terms of the issuance of
Securities, as contemplated by this Agreement). The                     Company
understands and confirms that the Investor will rely on the foregoing
                    representations in effecting transactions in securities of the
Company. All                     disclosure provided by the Company to the Investor
regarding the Company, its                     business and the transactions contemplated
hereby, including the <U>Schedules</u> to this Agreement, furnished by or on the behalf
of the Company                     are true and correct in all material respects and do
not contain any untrue                     statement of a material fact or omit to state
any material fact necessary in                     order to make the statements made
therein, in the light of the circumstances                     under which they were
made, not misleading. To the Company&#146;s knowledge,                     except for the
transactions contemplated by this Agreement, no event or                     circumstance
has occurred or information exists with respect to the Company or                     any
of its Subsidiaries or its or their business, properties, operations or
                    financial condition, which, under applicable law, rule or regulation,
requires                     public disclosure or announcement by the Company but which
has not been so                     publicly announced or disclosed. The Company
acknowledges and agrees that the                     Investor does not make nor has it
made any representations or warranties with                     respect to the
transactions contemplated hereby other than those set forth in                     the
Transaction Documents.  </font>
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<font size=2>11</font></p>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(s)
<U>Acknowledgment Regarding Investor&#146;s Purchase of Securities</u>. Based
                    upon the assumption that the transactions contemplated by this
Agreement are                     consummated in all material respects in conformity with
the Transaction                     Documents, the Company acknowledges and agrees that
the Investor is acting                     solely in the capacity of an arm&#146;s length
purchaser with respect to the                     Transaction Documents and the
transactions contemplated hereby and thereby. The                     Company further
acknowledges that the Investor is not acting as a financial                     advisor
or fiduciary of the Company (or in any similar capacity) with respect to
                    this Agreement and the transactions contemplated hereby and any
advice given by                     the Investor or any of its representatives or agents
in connection with the                     Transaction Documents and the transactions
contemplated hereby and thereby is                     merely incidental to the Investor&#146;s
purchase of the Securities. The Company                     further represents to the
Investor that the Company&#146;s decision to enter                     into this
Agreement has been based solely on the independent evaluation of the
                    transactions contemplated hereby by the Company and its
representatives.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(t)
<U>Patents and Trademarks</u>. Except as described in the SEC Reports, the
                    Company and each of its subsidiaries own or, to the Company&#146;s
best                     knowledge, possess a valid and enforceable right to use all: (i)
patents and                     patent applications, (ii) registered and unregistered
trademarks, service marks,                     trade names, trademark applications and
service mark applications, (iii)                     registered and unregistered
copyrights and copyright applications, and (iv)                     other intellectual
property (including trade secrets, licenses, know-how,                     software,
systems, technology and other unpatented and/or unpatentable
                    proprietary or confidential information, systems or procedures) (the
                    &#147;<B>Intellectual Property</b>&#148;) necessary for the conduct
of their                     respective businesses as now conducted. Except as set forth
in <U>Schedule                     3.1(t) </u> and off-the-shelf products, none of the
Company&#146;s Intellectual                     Property rights have expired or
terminated, or are expected to expire or                     terminate, within three (3)
years from the date of this Agreement. The Company                     does not have any
knowledge of any infringement by the Company or its                     Subsidiaries of
Intellectual Property rights of others and does not have any                     reason
to believe that the conduct of the businesses of the Company and its
                    Subsidiaries conflicts with any Intellectual Property rights of any
third party,                     nor has the Company or any of its Subsidiaries received
any notice of any claim                     of conflict with, any such Intellectual
Property rights of any third party,                     which claim, if the subject of an
unfavorable decision, ruling or judgment,                     would reasonably be
expected to result in a Material Adverse Effect. Except as                     disclosed
in the SEC Reports: (i) the Company is not aware of any infringement
                    by third parties of any of its Intellectual Property; (ii) there is
no pending                     or, to the Company&#146;s best knowledge, threatened
action, suit, proceeding or                     claim by others challenging the Company&#146;s
rights in or to any such                     Intellectual Property; and (iii) there is no
pending or, to the Company&#146;s                     best knowledge, threatened action,
suit, proceeding or claim by others that the                     Company infringes or
otherwise violates any patent, trademark, copyright, trade                     secret or
other proprietary rights of others.  </font>
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<font size=2>12</font></p>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(u)
<U>Insurance</u>. The Company and the Subsidiaries are insured by insurers of
                    recognized financial responsibility against such losses and risks and
in such                     amounts as are prudent and customary in the businesses and
location in which the                     Company and the Subsidiaries are engaged.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v)
<U>Regulatory Permits</u>. The Company and the Subsidiaries possess all
                    franchises, licenses, certificates, authorizations and permits issued
by the                     appropriate Israeli, United States federal, state, local or
foreign regulatory                     authorities necessary to conduct their respective
businesses as described in the                     SEC Reports (&#147;<B>Material Permits&#148;</b>),
except where the failure to                     possess such permits does not,
individually or in the aggregate, have or                     reasonably be expected to
result in a Material Adverse Effect; each such                     Material Permit is
valid and in full force and effect, and neither the Company                     nor any
Subsidiary has received any written notice of investigations or
                    proceedings relating to the revocation or modification of, or
imposition of a                     materially burdensome restriction on, any Material
Permit.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(w)
                    &nbsp;&nbsp;<U>Transactions With Affiliates and Employees</u>. Except
as set                     forth or incorporated by reference in the Company&#146;s SEC
Reports, none of                     the officers, directors or employees of the Company
is presently a party to any                     transaction that would be required to be
reported on a Form 20-F with the                     Company or any of its Subsidiaries
(other than for ordinary course services as                     employees, officers or
directors), including any contract, agreement or other                     arrangement
providing for the furnishing of services to or by, providing for
                    rental of real or personal property to or from, or otherwise
requiring payments                     to or from any such officer, director or employee
or, to the Company&#146;s                     knowledge, any corporation, partnership,
trust or other entity in which any such                     officer, director, or
employee has a substantial interest or is an officer,                     director,
trustee or partner.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(x)
<U>Internal Accounting Controls</u>. The Company and the Subsidiaries maintain a
                    system of internal accounting controls sufficient to provide
reasonable                     assurance that (i)&nbsp;transactions are executed in
accordance with                     management&#146;s general or specific authorizations,
(ii)&nbsp;transactions are                     recorded as necessary to permit
preparation of financial statements in                     conformity with generally
accepted accounting principles and to maintain asset                     accountability,
(iii)&nbsp;access to the Company&#146;s assets is permitted only                     in
accordance with management&#146;s general or specific authorization, and
                    (iv)&nbsp;the recorded accountability for assets is compared with the
existing                     assets at reasonable intervals and appropriate action is
taken with respect to                     any differences. The Company and each of its
Subsidiaries have established and                     maintain disclosure controls and
procedures (as such term is defined in Rule                     13a-15 promulgated under
the Exchange Act), (ii) such disclosure controls and                     procedures are
designed to ensure that the information required to be disclosed                     by
the Company and its Subsidiaries in the reports they will file or submit
                    under the Exchange Act is accumulated and communicated to management
of the                     Company and its Subsidiaries, including their respective
principal executive                     officers and principal financial officers, as
appropriate, to allow timely                     decisions regarding required disclosure
to be made and (iii) such disclosure                     controls and procedures are
effective in all material respects to perform the                     functions for which
they were established. Since the date of the most recent                     balance
sheet of the Company and its consolidated Subsidiaries reviewed or
                    audited by Somekh Chaikin, a member of KPMG International and the
audit                     committee of the board of directors of the Company, (i) the
Company has not been                     advised of (A) any significant deficiencies in
the design or operation of                     internal controls that could adversely
affect the ability of the Company and                     each of its Subsidiaries to
record, process, summarize and report financial                     data, or any material
weaknesses in internal controls and (B) any fraud, whether                     or not
material, that involves management or other employees who have a
                    significant role in the internal controls of the Company and each of
its                     Subsidiaries, and (ii) since that date, there have been no
significant changes                     in internal controls or in other factors that
could significantly affect                     internal controls, including any
corrective actions with regard to significant                     deficiencies and
material weaknesses.  </font>
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<font size=2>13</font></p>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(y)
<U>Sarbanes-Oxley Act</u>. The Company is in compliance in all material respects
                    with applicable requirements of the Sarbanes-Oxley Act of 2002 and
applicable                     rules and regulations promulgated by the SEC thereunder,
except where such                     noncompliance would not have, individually or in
the aggregate, a Material                     Adverse Effect.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(z)
<U>Foreign Corrupt Practices</u>. Neither the Company nor any of its
                    Subsidiaries nor, to the knowledge of the Company, any director,
officer, agent,                     employee or other Person acting on behalf of the
Company or any of its                     Subsidiaries has, in the course of its actions
for, or on behalf of, the Company                     (i) used any corporate funds for
any unlawful contribution, gift, entertainment                     or other unlawful
expenses relating to political activity; (ii) made any direct                     or
indirect unlawful payment to any foreign or domestic government official or
                    employee from corporate funds; (iii) violated or is in violation of
any                     provision of the U.S. Foreign Corrupt Practices Act of 1977, as
amended; or (iv)                     made any unlawful bribe, rebate, payoff, influence
payment, kickback or other                     unlawful payment to any foreign or
domestic government official or employee.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(aa)
<U>Employee Relations</u>. Neither the Company nor any of its Subsidiaries is a
                    party to any collective bargaining agreement or employs any member of
a union                     that relates to such employee&#146;s relationship with the
Company. The Company                     believes that its relations with its employees
are as disclosed in the SEC                     Reports. Except as disclosed in the SEC
Reports, during the twelve (12) month                     prior to the date hereof, no
executive officer of the Company or any of its                     Subsidiaries (as
defined in Rule 501(f) of the Securities Act) has notified the
                    Company or any such Subsidiary that such officer intends to leave the
Company or                     any such Subsidiary or otherwise terminate such officer&#146;s
employment with                     the Company or any such Subsidiary. To the knowledge
of the Company or any such                     Subsidiary, no executive officer of the
Company or any of its Subsidiaries is in                     violation of any material
term of any employment contract, confidentiality,                     disclosure or
proprietary information agreement, non-competition agreement, or                     any
other contract or agreement or any restrictive covenant, and the continued
                    employment of each such executive officer does not subject the
Company or any                     such Subsidiary to any material liability with respect
to any of the foregoing                     matters.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(bb)
<U>Labor Matters</u>. The Company and its Subsidiaries are in compliance in all
                    material respects with all applicable Israeli, federal, state, local
and foreign                     laws, rules, and regulations respecting labor, employment
and employment                     practices and benefits, terms and conditions of
employment and wages and hours,                     except where failure to be in
compliance would not, either individually or in                     the aggregate,
reasonably be expected to result in a Material Adverse Effect.  </font>
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<font size=2>14</font></p>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(cc)
<U>Environmental Laws</u>. The Company and its Subsidiaries (i) are in
                    compliance in all material respects with any and all Environmental
Laws (as                     hereinafter defined), (ii)&nbsp;have received all permits,
licenses or other                     approvals required of them under applicable
Environmental Laws to conduct their                     respective businesses and (iii)
are in compliance in all material respects with                     all terms and
conditions of any such permit, license or approval where, in each                     of
the foregoing clauses (i), (ii) and (iii), the failure to so comply would be
                    reasonably expected to have, individually or in the aggregate, a
Material                     Adverse Effect. The term &#147;<B>Environmental Laws</b>&#148; means
all                     applicable Israeli and other laws, regulations, ordinances,
rules, orders,                     judgments, decrees, permits or other legal
requirements of any governmental                     authority, including without
limitation any international, national, state,                     provincial, regional,
or local authority, relating to the protection of human                     health or
safety, the environment, or natural resources (including, without
                    limitation, ambient air, surface water, groundwater, land surface or
subsurface                     strata), including, without limitation, laws relating to
emissions, discharges,                     releases or threatened releases of chemicals,
pollutants, contaminants, or toxic                     or hazardous substances or wastes
(collectively, &#147;<B>Hazardous                     Materials</b>&#148;) into the
environment, or otherwise relating to the                     manufacture, processing,
distribution, use, treatment, storage, disposal,                     transport or
handling of Hazardous Materials, as well as all authorizations,
                    codes, decrees, demands or demand letters, injunctions, judgments,
licenses,                     notices or notice letters, orders, permits, plans or
regulations issued,                     entered, promulgated or approved thereunder.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(dd)
<U>Subsidiary Rights</u>. Except as set forth in <U>Schedule 3.1(ee)</u>, the
                    Company or one of its Subsidiaries has the unrestricted right to
vote, and                     (subject to limitations imposed by applicable law) to
receive dividends and                     distributions on, all capital securities of its
Subsidiaries as owned by the                     Company or such Subsidiary.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ee)
<U>Tax Status.</u> The Company and each of its Subsidiaries (i) has made or
                    filed all foreign, federal and state income and all other tax
returns, reports                     and declarations required by any jurisdiction to
which it is subject, (ii) has                     paid all taxes and other governmental
assessments and charges that are material                     in amount, shown or
determined to be due on such returns, reports and                     declarations,
except those being contested in good faith and (iii) has set aside                     on
its books provision reasonably adequate for the payment of all taxes for
                    periods subsequent to the periods to which such returns, reports or
declarations                     apply. There are no unpaid taxes in any material amount
claimed to be due by the                     taxing authority of any jurisdiction, and
the officers of the Company and each                     of its Subsidiaries know of no
basis for any such claim.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ff)
<U>Approved Enterprise</u>. Except as set forth on Schedule 3.1(ff), the Company
                    is in compliance in all material respects with all conditions and
requirements                     stipulated by the instruments of approval granted to it
with respect to the                     &#147;Approved Enterprise&#148; status of any of
the facilities of the Company                     by Israeli laws and regulations
relating to such &#147;Approved Enterprise&#148;                    and the Company has
not received any notice of any proceeding or investigation                     relating
to revocation or modification of any &#147;Approved Enterprise&#148;                    status
granted with respect to any of the Company&#146;s facilities.  </font>
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<font size=2>15</font></p>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(gg)
<U>Office of Chief Scientist</u>. Except as set forth on Schedule 3.1(gg), the
                    Company is in compliance in all material respects with the conditions
and                     requirements of the instruments of approval granted to it by the
Office of Chief                     Scientist of the Israeli Ministry of Industry, Trade
and Labor and any                     applicable laws and regulations, including the Law
for the Encouragement of                     Industrial Research and Development, 1984,
with respect to any research and                     development grants given to it by
such office, and is in full compliance with                     the repayment of all
royalties, interest and penalties due under such laws and
                    regulations. All information supplied by the Company with respect to
such                     applications was true, correct and complete in all material
respects when                     supplied to the appropriate authorities.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(hh)
<U>Controlled Foreign Corporation</u>. The Company believes based on its current
                    ownership that it is not a Controlled Foreign Corporation within the
meaning of                     Section 957 of the Code.  </font>
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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.2
<U>Representations, Warranties and Covenants of the Investor</u>. The Investor hereby
represents, warrants and covenants to the Company as follows:  </font></p>


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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)
<U>Organization; Authority</u>. The Investor is an entity duly organized,
                    validly existing and in good standing under the laws of the
jurisdiction of its                     organization with the requisite corporate,
partnership or other power and                     authority to enter into and to
consummate the transactions contemplated by the                     Transaction Documents
and otherwise to carry out its obligations hereunder and                     thereunder.
The purchase by the Investor of the Securities hereunder has been
                    duly authorized by all necessary corporate, partnership or other
action on the                     part of the Investor. This Agreement has been duly
executed and delivered by the                     Investor and constitutes the valid and
binding obligation of the Investor,                     enforceable against it in
accordance with its terms, except as may be limited by                     (i)&nbsp;applicable
bankruptcy, insolvency, reorganization or other laws of                     general
application relating to or affecting the enforcement of creditors rights
                    generally, and (ii)&nbsp;the effect of rules of law governing the
availability                     of specific performance and other equitable remedies.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)
<U>No Public Sale or Distribution</u>. The Investor is (i)&nbsp;acquiring the
                    Shares and the Warrant and (ii)&nbsp;upon exercise of the Warrant
will acquire                     the Warrant Shares issuable upon exercise thereof, in
the ordinary course of                     business for its own account and not with a
view towards, or for resale in                     connection with, the public sale or
distribution thereof, except pursuant to                     sales registered under the
Securities Act or under an exemption from such                     registration and in
compliance with applicable federal and state securities                     laws, and the
Investor does not have a present arrangement to effect any
                    distribution of the Securities to or through any person or entity; <U>provided</u>,
<U>however</u>, that by making the representations herein, the
                    Investor does not agree to hold any of the Securities for any minimum
or other                     specific term and reserves the right to dispose of the
Securities at any time in                     accordance with or pursuant to a
registration statement or an exemption under                     the Securities Act.  </font>
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<font size=2>16</font></p>
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<td Width=95%><FONT FACE="Times New Roman, Times, Serif" SIZE="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)
<U>Investor Status</U>. At the time the Investor was offered the Securities, it
was, and at the date hereof it is, an &#147;accredited investor&#148; as
defined in Rule 501(a) under the Securities Act or a &#147;qualified
institutional buyer&#148; as defined in Rule 144A(a) under the
Securities Act. The Investor is not a registered broker-dealer
registered under Section 15(a) of the Exchange Act, or a member of
the National Association of Securities Dealers, Inc. (the &#147;<B>NASD</B>&#148;)
or an entity engaged in the business of being a broker dealer. Except
as otherwise disclosed in writing to the Company on <U>Exhibit A-2 </U>(attached
hereto) on or prior to the date of this Agreement, the Investor is not
affiliated with any broker dealer registered under Section 15(a) of
the Exchange Act, or a member of the NASD or an entity engaged in the
business of being a broker dealer. The investor is not a resident of,
or organized under the laws of, the State of Israel. The Investor is
not a resident of or organized under the laws of a state that either
(a) is at war with the State of Israel or (b) has been declared by
competent Israeli authorities as a state &#147;hostile&#148; to
Israel. </FONT>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)
<U>Experience of The Investor</u>. The Investor, either alone or together with
                    its representatives has such knowledge, sophistication and experience
in                     business and financial matters so as to be capable of evaluating
the merits and                     risks of the prospective investment in the Securities,
and has so evaluated the                     merits and risks of such investment. The
Investor understands that it must bear                     the economic risk of this
investment in the Securities indefinitely, and is able                     to bear such
risk and is able to afford a complete loss of such investment.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)
<U>Access to Information</u>. The Investor acknowledges that it has reviewed the
                    Disclosure Materials and has been afforded: (i)&nbsp;the opportunity
to ask such                     questions as it has deemed necessary of, and to receive
answers from,                     representatives of the Company concerning the terms and
conditions of the                     offering of the Securities and the merits and risks
of investing in the                     Securities; (ii)&nbsp;access to information
(other than material non-public                     information) about the Company and
the Subsidiaries and their respective                     financial condition, results of
operations, business, properties, management and                     prospects sufficient
to enable it to evaluate its investment; and (iii)&nbsp;the
                    opportunity to obtain such additional information that the Company
possesses or                     can acquire without unreasonable effort or expense that
is necessary to make an                     informed investment decision with respect to
the investment. Neither such                     inquiries nor any other investigation
conducted by or on behalf of the Investor                     or its representatives or
counsel shall modify, amend or affect the                     Investor&#146;s right to
rely on the truth, accuracy and completeness of the                     Disclosure
Materials and the Company&#146;s representations and warranties
                    contained in the Transaction Documents.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)
<U>No Governmental Review</u>. The Investor understands that no Israeli or
                    United States federal or state agency or any other government or
governmental                     agency has passed on or made any recommendation or
endorsement of the Securities                     or the fairness or suitability of the
investment in the Securities nor have such                     authorities passed upon or
endorsed the merits of the offering of the                     Securities.  </font>
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<font size=2>17</font></p>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g)
<U>No Conflicts</u>. The execution, delivery and performance by the Investor of
                    this Agreement and the consummation by the Investor of the
transactions                     contemplated hereby will not (i)&nbsp;result in a
violation of the                     organizational documents of the Investor or (ii)&nbsp;conflict
with, or                     constitute a default (or an event which with notice or lapse
of time or both                     would become a default) under, or give to others any
rights of termination,                     amendment, acceleration or cancellation of,
any agreement, indenture or                     instrument to which the Investor is a
party, or (iii)&nbsp;result in a violation                     of any law, rule,
regulation, order, judgment or decree (including federal and                     state
securities laws) applicable to the Investor, except in the case of clauses
                    (ii) and (iii) above, for such that are not material and do not
otherwise affect                     the ability of the Investor to consummate the
transactions contemplated hereby.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h)
<U>Prohibited Transactions</u>. Neither the Investor, directly or indirectly,
                    nor any Person acting on behalf of or pursuant to any understanding
with the                     Investor, has engaged in any purchases or sales of any
securities, including any                     derivatives, of the Company (including,
without limitation, any Short Sales                     involving any of the Company&#146;s
securities) (a <B>&#147;Transaction</b>&#148;) since the time that the Investor was first
                    contacted by the Company, the Agents or any other Person regarding an
investment                     in the Company. The Investor covenants that neither it nor
any Person acting on                     its behalf or pursuant to any understanding with
the Investor will engage,                     directly or indirectly, in any Transactions
prior to the Closing. &#147;<B>Short                     Sales</b>&#148; include, without
limitation, all &#147;short sales&#148; as                     defined in Rule 200
promulgated under Regulation SHO under the Exchange Act and                     all types
of direct and indirect stock pledges, forward sale contracts, options,
                    puts, calls, short sales, swaps, derivatives and similar arrangements
(including                     on a total return basis), and sales and other transactions
through non-U.S.                     broker-dealers or foreign regulated brokers.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) <U>Restricted
Securities</u>. The Investor understands that the Securities are
               characterized as &#147;restricted securities&#148; under the U.S. federal
               securities laws inasmuch as they are being acquired from the Company in a
               transaction not involving a public offering and that under such laws and
               applicable regulations such securities may be resold without registration
under                the Securities Act only and under Israeli securities laws in certain
limited                circumstances. The Investor understands and acknowledges that: (i)
the                Securities are being offered and sold to it without registration under
the                Securities Act in a private placement that is exempt from the
registration                provisions of the Securities Act and (ii) the availability of
such exemption                depends in part on, and the Company will rely upon the
accuracy and truthfulness                of, the foregoing representations and the
Investor hereby consents to such                reliance.  </font>
</td>
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<br>

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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j) <U>Legends</u>.
It is understood that, except as provided in <U>Section                4.1(b)</u> of this
Agreement, certificates evidencing such Securities may bear                the legend set
forth in <U>Section 4.1(b).</u> </font>
</td>
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<br>

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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(k) <U>No
Legal, Tax or Investment Advice</u>. The Investor understands that nothing
               in this Agreement or any other materials presented by or on behalf of the
               Company to the Investor in connection with the purchase of the Securities
               constitutes legal, tax or investment advice. The Investor has consulted
such                legal, tax and investment advisors as it, in its sole discretion, has
deemed                necessary or appropriate in connection with its purchase of the
Securities. The                Investor understands that the Agents have acted solely as
the agent of the                Company in this placement of the Securities, and that the
Agents make no                representation or warranty with regard to the merits of
this transaction or as                to the accuracy of any information the Investor may
have received in connection                therewith. The Investor acknowledges that it
has not relied on any information                or advice furnished by or on behalf of
the Agents.  </font>
</td>
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<br>

<p align=center>
<font size=2>18</font></p>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(l) <U>Residency</u>.
The Investor&#146;s principal executive offices are in the                jurisdiction
set forth immediately below the Investor&#146;s name on the                signature page
hereto.  </font>
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<P Align="Center"><Font Face="Times New Roman, Times, Serif" Size=2>ARTICLE IV </font><Br>
<Font Face="Times New Roman, Times, Serif" Size=2>OTHER AGREEMENTS OF THE
PARTIES </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1
<U>Transfer Restrictions</u>.  </font></p>


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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)
                    The Investor covenants that the Securities will only be disposed of
pursuant to                     an effective registration statement under, and in
compliance with the                     requirements of, the Securities Act or pursuant
to an available exemption from                     the registration requirements of the
Securities Act, and in compliance with any                     applicable state
securities laws and Israeli securities laws. In connection with                     any
transfer of Securities other than pursuant to an effective registration
                    statement or to the Company, or pursuant to Rule 144(k), the Company
may require                     the transferor to provide to the Company an opinion of
counsel selected by the                     transferor, the form and substance of which
opinion shall be reasonably                     satisfactory to the Company, to the
effect that such transfer does not require                     registration under the
Securities Act. Notwithstanding the foregoing, the                     Company hereby
consents to and agrees to register on the books of the Company                     and
with its Transfer Agent, without any such legal opinion, except to the
                    extent that the Transfer Agent requests such legal opinion, any
transfer of                     Securities by the Investor to an Affiliate of the
Investor; <U>provided</u>,                     that the transferee certifies to the
Company that it is an &#147;accredited                     investor&#148; as defined in
Rule 501(a) promulgated under the Securities Act                     and provided that
such Affiliate does not request any removal of any existing                     legends
on any certificate evidencing the Securities.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)
                    The Investor agrees to the imprinting, so long as is required by this
<U>Section&nbsp;4.1(b</u>), of a legend on any certificate evidencing any of the
                    Securities substantially in the following form:  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>
THE
SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED WITH THE SECURITIES AND
EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN
EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE &#147;SECURITIES
ACT&#148;), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION
FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES
ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS AS EVIDENCED BY A LEGAL
OPINION OF COUNSEL TO THE TRANSFEROR TO SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE
REASONABLY ACCEPTABLE TO THE COMPANY. THESE SECURITIES MAY BE PLEDGED IN CONNECTION WITH
A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN SECURED BY SUCH SECURITIES.  </font></td>
</tr>
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<br>

<p align=center>
<font size=2>19</font></p>
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<P><Font Face="Times New Roman, Times, Serif" Size=2>Certificates evidencing the
Securities (other than the Warrant) shall not be required to contain such legend or any
other legend (i) while a registration statement (including the Registration Statement)
covering the resale of such Securities is effective under the Securities Act, (ii)
following any sale of such Securities pursuant to Rule 144 if the holder provides the
Company with a legal opinion (and the documents upon which the legal opinion is based)
reasonably acceptable to the Company to the effect that such Securities can be sold under
Rule 144, (iii) if the holder provides the Company with a legal opinion or certification
(and the documents upon which such legal opinion or certification is based) reasonably
acceptable to the Company to the effect that such Securities are eligible for sale under
Rule 144(k), or (iv) if the holder provides the Company with a legal opinion (and the
documents upon which the legal opinion is based) reasonably acceptable to the Company to
the effect that the legend is not required under applicable requirements of the Securities
Act (including controlling judicial interpretations and pronouncements issued by the Staff
of the SEC). The Company shall cause its counsel to issue the legal opinion included in
the Transfer Agent Instructions to the Transfer Agent on the Effective Date. Following the
Effective Date or at such earlier time as a legend is no longer required for certain
Securities, the Company will no later than three (3) Trading Days following the delivery
by the Investor to the Company or the Transfer Agent of (i) a legended certificate
representing such Securities and any other documentation required by this
<U>Section&nbsp;4.1(b)</u>, and (ii) an opinion of counsel to the extent required by
<U>Section 4.1(a)</u>, deliver or cause to be delivered to the Investor a certificate
representing such Securities that are free from all restrictive and other legends. The
Company may not make any notation on its records or give instructions to the Transfer
Agent that enlarge the restrictions on transfer set forth in this Section. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>If within three (3) Trading Days
after the Company&#146;s receipt of a legended certificate and the other documents as
specified in Clauses (i) and (ii) of the paragraph immediately above (as applicable), the
Company shall fail to issue and deliver to the Investor a certificate representing such
Securities that is free from all restrictive and other legends, and if on or after such
Trading Day the Investor purchases (in an open market transaction or otherwise) Ordinary
Shares to deliver in satisfaction of a sale by the Investor of Ordinary Shares that the
Investor anticipated receiving from the Company without any restrictive legend (the
<B>&#147;Covering Shares</b>&#148;), then the Company shall, within three (3) Trading Days
after the Investor&#146;s request, pay cash to the Investor in an amount equal to the
excess (if any) of the Investor&#146;s total purchase price (including brokerage
commissions, if any) for the Covering Shares, over the product of (A) the number of
Covering Shares, times (B) the closing bid price on the date of delivery by the Investor
of such certificate and the other documents as specified in Clauses (i) and (ii) of the
paragraph immediately above (as applicable). The preceding shall apply with respect to
Shares only and not with respect to any failure by the Company to deliver a certificate
representing Warrant Shares upon exercise of the Warrant, which shall be governed by the
terms of the Warrant. </font></p>

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<font size=2>20</font></p>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)              The
Company will not object to and shall permit (except as prohibited by law)
               the Investor to pledge or grant a security interest in some or all of the
               Securities in connection with a bona fide margin agreement or other loan
or                financing arrangement secured by the Securities, and if required under
the terms                of such agreement, loan or arrangement, the Company will not
object to and shall                permit (except as prohibited by law) the Investor to
transfer pledged or secured                Securities to the pledgees or secured parties.
Except as required by law, such a                pledge or transfer would not be subject
to approval of the Company, no legal                opinion of the pledgee, secured party
or pledgor shall be required in connection                therewith, and no notice shall
be required of such pledge. The Investor                acknowledges that the Company
shall not be responsible for any pledges relating                to, or the grant of any
security interest in, any of the Securities or for any                agreement,
understanding or arrangement between the Investor and its pledgee or
               secured party. At the Investor&#146;s expense, the Company will execute
and                deliver such reasonable documentation as a pledgee or secured party of
               Securities may reasonably request in connection with a pledge or transfer
of the                Securities, including the preparation and filing of any required
prospectus                supplement under Rule 424(b)(3) of the Securities Act or other
applicable                provision of the Securities Act to appropriately amend the list
of Selling                Stockholders thereunder. Provided that the Company is in
compliance with the                terms of this <U>Section </u><U>4.1(c)</u>, the Company&#146;s
indemnification                obligations pursuant to <U>Section 6.4</u> shall not
extend to any Proceeding or                Losses arising out of or related to this <U>Section
4.1(c)</u>.  </font>
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</table>
<br>



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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)               The
Investor agrees that the removal of the restrictive legend from certificates
               representing Securities as set forth in this <U>Section 4.1</u> is
predicated                upon the Company&#146;s reliance that the Investor will sell
any Securities                pursuant to either the registration requirements of the
Securities Act,                including any applicable prospectus delivery requirements,
or an exemption                therefrom, and that if Securities are sold pursuant to a
Registration Statement,                they will be sold in compliance with the plan of
distribution set forth therein.                Both the Company and its transfer agent,
and their respective directors,                officers, employees and agents, may rely
on this <U>Section 4.1(d)</u>.  </font>
</td>
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<br>

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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)             At
the Company&#146;s discretion, the Company, may, by written notice, require
               the Investor to deliver legended share certificates and/or other related
               documentation and/or may require the Investor to furnish the Warrant
exercise                notices and/or other related documentation, directly to the
Transfer Agent (with                a copy to the Company).  </font>
</td>
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<br>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.2
<U>Furnishing of Information</u>. Until the date that the Investor may sell the Shares
and the Warrant Shares under Rule 144(k) of the Securities Act (or any successor
provision), the Company covenants to use its commercially reasonable efforts to timely
file (or obtain extensions in respect thereof and file within the applicable grace
period) all reports required to be filed by the Company after the date hereof pursuant to
the Exchange Act. The Company further covenants that it will take such further action as
any holder of Securities may reasonably request to satisfy the provisions of this <U>Section
4.2</u>.  </font></p>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.3
<U>Integration</u>. The Company shall not, and shall use its commercially reasonably
efforts to ensure that no Affiliate thereof shall, sell, offer for sale or solicit offers
to buy or otherwise negotiate in respect of any security (as defined in Section&nbsp;2 of
the Securities Act) that would be integrated with the offer or sale of the Securities in
a manner that would require the registration under the Securities Act of the sale of the
Securities to the Investor or that would be integrated with the offer or sale of the
Securities for purposes of the rules and regulations of any Trading Market.  </font></p>

<p align=center>
<font size=2>21</font></p>
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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.4
<U>Reservation of Securities</u>. The Company shall maintain a reserve from its duly
authorized Ordinary Shares for issuance pursuant to the Transaction Documents in such
amount as may be required to fulfill its obligations to issue all Shares and Warrant
Shares under the Transaction Documents. In the event that at any time the then authorized
Ordinary Shares are insufficient for the Company to satisfy its obligations to issue such
Shares and Warrant Shares under the Transaction Documents, the Company shall promptly
take such actions as may be required to increase the number of authorized Ordinary
Shares.  </font></p>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.5
<U>Securities Laws Disclosure; Publicity</u>. The Company shall, on or before 8:30 a.m.,
Eastern time, on the first Trading Day following execution of this Agreement, issue a
press release reasonably acceptable to the Investor disclosing all material terms of the
transactions contemplated hereby. On the Closing Date, the Company shall file a Current
Report on Form 6-K with the SEC (the <B>&#147;6-K Filing</b>&#148;) describing the terms
of the transactions contemplated by the Transaction Documents and including as exhibits
to such Current Report on Form 6-K the Transaction Documents (including the schedules and
the name of the Investor and the amount of Securities purchased) and the form of Warrant,
in the form required by the Exchange Act. Thereafter, the Company shall timely file any
filings and notices required by the SEC or applicable law or regulation with respect to
the transactions contemplated hereby and provide copies thereof to the Investor promptly
after filing. Except as herein provided, the Company shall not publicly disclose the name
of the Investor, or include the name of the Investor in any press release without the
prior written consent of the Investor, unless otherwise required by law or governmental
or regulatory authority, or in the Registration Statement. The Company shall not, and
shall cause each of its Subsidiaries and its and each of their respective officers,
directors, employees and agents not to, provide the Investor with any material nonpublic
information regarding the Company or any of its Subsidiaries from and after the issuance
of the above referenced press release without the express written consent of the
Investor.  </font></p>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.6
<U>Use of Proceeds</u>. The Company intends to use the net proceeds from the sale of the
Securities for working capital and general corporate purposes. The Company also may use a
portion of the net proceeds, currently intended for general corporate purposes, to
acquire or invest in technologies, products, services or companies that complement its
business, although the Company has no present plans or commitments and is not currently
engaged in any material negotiations with respect to these types of transactions. Pending
these uses, the Company intends to invest the net proceeds from this offering in
short-term, interest-bearing, investment-grade securities, or as otherwise pursuant to
the Company&#146;s customary investment policies.  </font></p>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.7
<U>OCS Undertakings</u>. The Investor hereby agrees to execute an undertaking to the
Israeli Office of the Chief Scientist, in customary form, if, at or following the
Closing, the Investor shall hold 5% or more of the issued and outstanding Ordinary Shares
of the Company.  </font></p>

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<font size=2>22</font></p>
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<P Align="Center"><Font Face="Times New Roman, Times, Serif" Size=2>ARTICLE V </font><Br>
<Font Face="Times New Roman, Times, Serif" Size=2>CONDITIONS </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.1
<U>Conditions Precedent to the Obligations of the Investor</u>. The obligation of the
Investor to acquire Securities at the Closing is subject to the satisfaction or waiver by
the Investor, at or before the Closing, of each of the following conditions:  </font></p>



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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)
<U>Representations and Warranties</u>. The representations and warranties of the
                    Company contained herein shall be true and correct in all material
respects as                     of the date when made and in all material respects as of
the Closing as though                     made on and as of such date; and  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)
<U>Performance</u>. The Company shall have performed, satisfied and complied in
                    all material respects with all covenants, agreements and conditions
required by                     the Transaction Documents to be performed, satisfied or
complied with by it at                     or prior to the Closing, including, but not
limited to, the delivery of the                     items set forth in <U>Section&nbsp;2.2(a)</u>.  </font>
</td>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)
                    Prior to the Closing, the Company shall have sold securities to third
party                     purchasers, who are not acting in concert with the Investor,
for an aggregate                     minimum of $16 million and an aggregate maximum of
$18 million.&nbsp; Such                     securities shall be sold on, and have, such
terms and conditions as the Company                     shall determine in its sole
discretion.  </font>
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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.2
<U>Conditions Precedent to the Obligations of the Company</u>. The obligation of the
Company to sell the Securities at the Closing is subject to the satisfaction or waiver by
the Company, at or before the Closing, of each of the following conditions:  </font></p>


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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)
<U>Representations and Warranties</u>. The representations and warranties of the
                    Investor contained herein shall be true and correct in all material
respects as                     of the date when made and as of the Closing Date as
though made on and as of                     such date; and  </font>
</td>
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<br>

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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)
<U>Performance</u>. The Investor shall have performed, satisfied and complied in
                    all material respects with all covenants, agreements and conditions
required by                     the Transaction Documents to be performed, satisfied or
complied with by the                     Investor at or prior to the Closing.  </font>
</td>
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</table>
<br>

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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)
                    Prior to the Closing, the Company shall have sold securities to third
party                     purchasers, who are not acting in concert with the Investor,
for an aggregate                     minimum of $16 million and an aggregate maximum of
$18 million.&nbsp; Such                     securities shall be sold on, and have, such
terms and conditions as the Company                     shall determine in its sole
discretion.  </font>
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<P Align="Center"><Font Face="Times New Roman, Times, Serif" Size=2>ARTICLE VI </font><Br>
<Font Face="Times New Roman, Times, Serif" Size=2>REGISTRATION RIGHTS </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1
<U>Registration Statement</u>.  </font></p>


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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)
                    As promptly as possible, and in any event on or prior to the Filing
Date, the                     Company shall prepare and file with the SEC a Registration
Statement covering                     the resale of all Registrable Securities for an
offering to be made on a                     continuous basis pursuant to Rule 415. The
Registration Statement shall be on                     Form F-3 (except if the Company is
not then eligible to register for resale the                     Registrable Securities
on Form F-3, in which case such registration shall be on                     another
appropriate form in accordance with the Securities Act and the Exchange
                    Act) and shall contain (except if otherwise directed by the Investor
or                     requested by the SEC) a &#147;Plan of Distribution&#148; in
substantially the                     form attached hereto as <U>Exhibit&nbsp;C</u>.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)
                    The Company shall use its commercially reasonable efforts to cause
the                     Registration Statement to be declared effective by the SEC as
promptly as                     possible after the filing thereof, but in any event prior
to the Required                     Effectiveness Date, and shall use its commercially
reasonable efforts to keep                     the Registration Statement continuously
effective under the Securities Act until                     the earlier of the date that
all Registrable Securities covered by such                     Registration Statement
have been sold or can be sold publicly under Rule 144(k)                     (the <B>&#147;Effectiveness
Period&#148;)</b>; <U>provided</u>, that upon                     notification by the SEC
that a Registration Statement will not be reviewed or is                     no longer
subject to further review and comments, provided that in the opinion
                    of Company Counsel no pre-effective amendment is required under the
Securities                     Act, the Company shall request that the effectiveness of
the Registration                     Statement be accelerated to no later than 4:00 p.m.
Eastern Time on the fifth                     Trading Day after the Company&#146;s
receipt of such notification and file a                     prospectus supplement for any
Registration Statement, whether or not required                     under Rule 424 (or
otherwise), by 9:00 a.m. Eastern time within three (3)                     Business Days
after the Effective Date.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)
                    The Company shall notify the Investor in writing promptly (and in any
event                     within two (2) Trading Days) after receiving notification from
the SEC that the                     Registration Statement has been declared effective.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)
                    Should an Event (as defined below) occur, then upon the occurrence of
such                     Event, and on every monthly anniversary thereof until the
applicable Event is                     cured, the Company shall pay to the Investor
entitled to be included in the                     Registration Statement an amount in
cash, as liquidated damages and not as a                     penalty, equal to one
percent (1.0%) of (i) the number of Registrable Securities                     held by
the Investor as of the date of such Event, multiplied by (ii) the
                    purchase price paid by the Investor for such Registrable Securities
then held; <U>provided</u>, <U>however</u>, that the total amount of payments pursuant to
                    this <U>Section&nbsp;6.1(d)</u> shall not exceed, when aggregated
with all such                     payments paid to the Investor, ten percent (10%) of the
aggregate purchase                     price. The payments to which the Investor shall be
entitled pursuant to this <U>Section&nbsp;6.1(d</u>) are referred to herein as &#147;<B>Event
</b><B>Payments.</b>&#148; Any Event Payments payable pursuant to the terms hereof
                    shall apply on a pro rated basis for any portion of a month prior to
the cure of                     an Event. All pro rated calculations made pursuant to
this paragraph shall be                     based upon the actual number of days in such
pro rated month.  </font>
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<P><Font Face="Times New Roman, Times, Serif" Size=2>For such purposes, each of the
following shall constitute an &#147;<B>Event</b>&#148;: </font></p>

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<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)
                    the Registration Statement is not filed on or prior to the Filing
Date or is not                     declared effective on or prior to the Required
Effectiveness Date;  </font>
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<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)
                    except as provided for in <U>Section 6.1(e</u>) (the &#147;<B>Excluded
                    Events</b>&#148;), after the Effective Date, the Investor is not
permitted to                     sell Registrable Securities under the Registration
Statement (or a subsequent                     Registration Statement filed in
replacement thereof) for any reason (other than                     the fault of the
Investor) for ten (10) or more consecutive Trading Days or                     thirty
(30) Trading Days (whether or not consecutive) in any twelve (12) month
                    period;  </font>
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<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)
                    except as a result of the Excluded Events, the Ordinary Shares are
not listed or                     quoted, or are suspended from trading, on the Trading
Market or an Eligible                     Market for a period of three (3) Trading Days
(which need not be consecutive                     Trading Days) during the Effectiveness
Period; or  </font>
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<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv)
                    during the Effectiveness Period, except as a result of the Excluded
Events, the                     Company fails to have any Shares listed on the Trading
Market or an Eligible                     Market.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)
                    Notwithstanding anything in this Agreement to the contrary, after
sixty (60)                     consecutive Trading Days of continuous effectiveness of
the initial Registration                     Statement filed and declared effective
pursuant to this Agreement, the Company                     may, by written notice to the
Investor, suspend sales under a Registration                     Statement after the
Effective Date thereof and/or require that the Investor                     immediately
ceases the sale of shares of Ordinary Shares pursuant thereto and/or
                    defer the filing of any subsequent Registration Statement if the
Company is                     engaged in a material merger, acquisition or sale and the
Board of Directors                     determines in good faith, by appropriate
resolutions, that, as a result of such                     activity, (A)&nbsp;it would be
materially detrimental to the Company (other than                     as relating solely
to the price of the Ordinary Shares) to maintain<B></b>a                     Registration
Statement at such time or (B)&nbsp;it is in the best interests of                     the
Company to suspend sales under such registration at such time. Upon receipt
                    of such notice, the Investor shall immediately discontinue any sales
of                     Registrable Securities pursuant to such registration until the
Investor is                     advised in writing by the Company that the current
Prospectus or amended                     Prospectus, as applicable, may be used. In no
event, however, shall this right                     be exercised to suspend sales beyond
the period during which (in the good faith                     determination of the
Company&#146;s Board of Directors) the failure to require                     such
suspension would be materially detrimental to the Company. The                     Company&#146;s
rights under this <U>Section 6.1(e)</u> may be exercised for a                     period
of no more than twenty (20) Trading Days at a time and not more than
                    three (3) times in any twelve (12) month period, without such
suspension being                     considered as part of an Event Payment
determination. Immediately after the end                     of any suspension period
under this <U>Section 6.1(e)</u>, the Company shall                     take all
necessary actions (including filing any required supplemental
                    prospectus) to restore the effectiveness of the applicable
Registration                     Statement and the ability of the Investor to publicly
resell their Registrable                     Securities pursuant to such effective
Registration Statement.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)
                    The Company shall not, from the date hereof until the Effective Date
of the                     Registration Statement, prepare and file with the SEC a
registration statement                     relating to an offering for its own account or
the account of others under the                     Securities Act of any of its equity
securities, other than any registration                     statement or post-effective
amendment to a registration statement (or supplement                     thereto)
relating to the Company&#146;s employee benefit plans registered on
                    Form S-8.  </font>
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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.2
     <U>Registration   Procedures</u>.   In  connection  with  the  Company's  registration
  obligations hereunder, the Company shall: </font></p>


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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)
                    Not less than three (3) Trading Days prior to the filing of a
Registration                     Statement or any related Prospectus or any amendment or
supplement thereto,                     furnish via email to the Investor, if the
Investor has supplied the Company with                     an email address, copies of
all such documents proposed to be filed, which                     documents (other than
any document that is incorporated or deemed to be                     incorporated by
reference therein) will be subject to the review of the                     Investor. The
Company shall reflect in each such document when so filed with the
                    SEC such comments regarding the Investor and the plan of distribution
as the                     Investor may reasonably and promptly propose no later than two
(2) Trading Days                     after the Investor have been so furnished with
copies of such documents as                     aforesaid.  </font>
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<font size=2>25</font></p>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)
                    (i)&nbsp;Subject to <U>Section 6.1(e)</u>, prepare and file with the
SEC such                     amendments, including post-effective amendments, to each
Registration Statement                     and the Prospectus used in connection
therewith as may be necessary to keep the                     Registration Statement
continuously effective, as to the applicable Registrable                     Securities
for the Effectiveness Period and prepare and file with the SEC such
                    additional Registration Statements in order to register for resale
under the                     Securities Act all of the Registrable Securities; (ii)&nbsp;cause
the related                     Prospectus to be amended or supplemented by any required
Prospectus supplement,                     and as so supplemented or amended to be filed
pursuant to Rule 424;                     (iii)&nbsp;respond as promptly as reasonably
possible, and in any event within                     twelve (12) Trading Days (except to
the extent that the Company reasonably                     requires additional time to
respond to accounting comments), to any comments                     received from the
SEC with respect to the Registration Statement or any                     amendment
thereto; and (iv)&nbsp;comply in all material respects with the
                    provisions of the Securities Act and the Exchange Act with respect to
the                     disposition of all Registrable Securities covered by the
Registration Statement                     during the applicable period in accordance
with the intended methods of                     disposition by the Investor set forth in
the Registration Statement as so                     amended or in such Prospectus as so
supplemented.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)
                    Notify the Investor as promptly as reasonably possible, and (if
requested by the                     Investor confirm such notice in writing no later
than two (2) Trading Days                     thereafter, of any of the following events:
(i)&nbsp;the SEC notifies the                     Company whether there will be a &#147;review&#148; of
any Registration                     Statement; (ii)&nbsp;the SEC comments in writing on
any Registration Statement;                     (iii)&nbsp;any Registration Statement or
any post-effective amendment is                     declared effective; (iv)&nbsp;the SEC
or any other Federal or state governmental                     authority requests any
amendment or supplement to any Registration Statement or                     Prospectus
or requests additional information related thereto; (v)&nbsp;the SEC
                    issues any stop order suspending the effectiveness of any
Registration Statement                     or initiates any Proceedings for that purpose;
(vi)&nbsp;the Company receives                     notice of any suspension of the
qualification or exemption from qualification of                     any Registrable
Securities for sale in any jurisdiction, or the initiation or                     threat
of any Proceeding for such purpose; or (vii)&nbsp;the financial
                    statements included in any Registration Statement become ineligible
for                     inclusion therein or any Registration Statement or Prospectus or
other document                     contains any untrue statement of a material fact or
omits to state any material                     fact required to be stated therein or
necessary to make the statements therein,                     in the light of the
circumstances under which they were made, not misleading.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)
                    Use its reasonable Best Efforts to avoid the issuance of or, if
issued, obtain                     the withdrawal of (i)&nbsp;any order suspending the
effectiveness of any                     Registration Statement, or (ii)&nbsp;any
suspension of the qualification (or                     exemption from qualification) of
any of the Registrable Securities for sale in                     any jurisdiction, as
soon as possible.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)
                    If requested by the Investor, provide the Investor and its counsel,
without                     charge, at least one conformed copy of each Registration
Statement and each                     amendment thereto, including financial statements
and schedules, and all                     exhibits to the extent requested by such
Person (including those previously                     furnished or incorporated by
reference) promptly after the filing of such                     documents with the SEC.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)
                    Promptly deliver to the Investor, without charge, as many copies of
the                     Prospectus or Prospectuses (including each form of prospectus)
and each                     amendment or supplement thereto as such Persons may
reasonably request. The                     Company hereby consents to the use of such
Prospectus and each amendment or                     supplement thereto by the Investor
in connection with the offering and sale of                     the Registrable
Securities covered by such Prospectus and any amendment or                     supplement
thereto to the extent permitted by federal and state securities laws
                    and regulations.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g)
                    (i)&nbsp;In the time and manner required by each Trading Market,
prepare and                     file with such Trading Market an additional shares
listing application covering                     all of the Registrable Securities; (ii)&nbsp;take
all steps necessary to cause                     such Registrable Securities to be
approved for listing on each Trading Market as                     soon as possible
thereafter; (iii)&nbsp;provide to the Investor and its counsel
                    evidence of such listing, upon reasonable request; and (iv)&nbsp;except
as a                     result of the Excluded Events, during the Effectiveness Period,
maintain the                     listing of such Registrable Securities on each such
Trading Market or another                     Eligible Market.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h)
                    Prior to any public offering of Registrable Securities, use its
reasonable Best                     Efforts to register or qualify or cooperate with the
Investor in connection with                     the registration or qualification (or
exemption from such registration or                     qualification) of such
Registrable Securities for offer and sale under the                     securities or
Blue Sky laws of such jurisdictions within the United States as                     the
Investor requests in writing, to keep each such registration or
                    qualification (or exemption therefrom) effective for so long as
required, but                     not to exceed the duration of the Effectiveness Period,
and to do any and all                     other acts or things reasonably necessary or
advisable to enable the disposition                     in such jurisdictions of the
Registrable Securities covered by a Registration                     Statement; <U>provided</u>,
<U>however</u>, that the Company shall not be                     obligated to file any
general consent to service of process or to qualify as a                     foreign
corporation or as a dealer in securities in any jurisdiction in which it
                    is not so qualified or to subject itself to taxation in respect of
doing                     business in any jurisdiction in which it is not otherwise so
subject.  </font>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)
                    Cooperate with the Investor to facilitate the timely preparation and
delivery of                     certificates representing Registrable Securities to be
delivered to a transferee                     pursuant to a Registration Statement, which
certificates shall be free, to the                     extent permitted by this Agreement
and under law, of all restrictive legends,                     and to enable such
Registrable Securities to be in such denominations and                     registered in
such names as the Investor may reasonably request.  </font>
</td>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j)
                    Upon the occurrence of any event described in <U>Section&nbsp;6.2(c)(vii)</u>,
                    as promptly as reasonably possible, prepare a supplement or
amendment, including                     a post-effective amendment, to the Registration
Statement or a supplement to the                     related Prospectus or any document
incorporated or deemed to be incorporated                     therein by reference, and
file any other required document so that, as                     thereafter delivered,
neither the Registration Statement nor such Prospectus                     will contain
an untrue statement of a material fact or omit to state a material
                    fact required to be stated therein or necessary to make the
statements therein,                     in the light of the circumstances under which
they were made, not misleading.  </font>
</td>
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<p align=center>
<font size=2>27</font></p>
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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(k)
                    Cooperate with any reasonable due diligence investigation undertaken
by the                     Investor in connection with the sale of Registrable
Securities, including,                     without limitation, by making available
documents and information; <U>provided</u>, that the Company will not deliver or make
available to the                     Investor material, nonpublic information unless the
Investor requests in advance                     in writing to receive material,
nonpublic information and agrees to keep such                     information
confidential.  </font>
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<br>

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<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(l)
                    Comply with all rules and regulations of the SEC applicable to the
registration                     of the Securities.  </font>
</td>
</tr>
</table>
<br>

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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(m)
                    It shall be a condition precedent to the obligations of the Company
to complete                     the registration pursuant to this Agreement with respect
to the Registrable                     Securities of the Investor or to make any Event
Payments set forth in <U>Section                     6.1(c)</u> to the Investor that the
Investor furnish to the Company the                     information specified in <U>Exhibits
A-1</u>, <U>A-2</u> and <U>A-3</u> hereto                     and such other information
regarding itself, the Registrable Securities and                     other Ordinary
Shares or other securities of the Company held by it and the                     intended
method of disposition of the Registrable Securities held by it (if
                    different from the Plan of Distribution set forth on <U>Exhibit C</u> hereto)
as                     shall be reasonably required to effect the registration of such
Registrable                     Securities and shall complete and execute such documents
in connection with such                     registration as the Company may reasonably
request.  </font>
</td>
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</table>
<br>

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<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(n)
                    The Company shall comply with all applicable rules and regulations of
the SEC                     under the Securities Act and the Exchange Act, including,
without limitation,                     Rule 172 under the Securities Act, file any final
Prospectus, including any                     supplement or amendment thereof, with the
SEC pursuant to Rule 424 under the                     Securities Act, promptly inform
the Investor in writing if, at any time during                     the Effectiveness
Period, the Company does not satisfy the conditions specified                     in Rule
172 and, as a result thereof, the Investor is required to make available
                    a Prospectus in connection with any disposition of Registrable
Securities and                     take such other actions as may be reasonably necessary
to facilitate the                     registration of the Registrable Securities
hereunder.  </font>
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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.3
<U>Registration Expenses</u>. The Company shall pay all fees and expenses incident to the
performance of or compliance with Article&nbsp;VI of this Agreement by the Company,
including without limitation (a)&nbsp;all registration and filing fees and expenses,
including without limitation those related to filings with the SEC, any Trading Market
and in connection with applicable state securities or Blue Sky laws, (b)&nbsp;printing
expenses (including without limitation expenses of printing certificates for Registrable
Securities), (c)&nbsp;messenger, telephone and delivery expenses, (d)&nbsp;fees and
disbursements of counsel for the Company, (e) fees and expenses of all other Persons
retained by the Company in connection with the consummation of the transactions
contemplated by this Agreement, and (f)&nbsp;all listing fees to be paid by the Company
to the Trading Market.  </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.4
<U>Indemnification</u>.  </font></p>


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<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)
<U>Indemnification by the Company</u>. The Company shall, notwithstanding any
                    termination of this Agreement, indemnify and hold harmless the
Investor, its                     officers, directors, partners, managers, members,
agents and employees, each                     Person who controls the Investor (within
the meaning of Section&nbsp;15 of the                     Securities Act or Section&nbsp;20
of the Exchange Act) and the officers,                     directors, partners, managers,
members, agents and employees of each such                     controlling Person, to the
fullest extent permitted by applicable law, from and                     against any and
all Losses, as incurred, arising out of or relating to (i) any
                    misrepresentation or breach of any representation or warranty made by
the                     Company in the Transaction Documents or any other certificate,
instrument or                     document contemplated hereby or thereby, (ii) any
breach of any covenant,                     agreement or obligation of the Company
contained in the Transaction Documents or                     any other certificate,
instrument or document contemplated hereby or thereby,                     (iii) any
cause of action, suit or claim brought or made against such
                    Indemnified Party (as defined in <U>Section 6.4(c)</u> below) by a
third party                     (including for these purposes a derivative action brought
on behalf of the                     Company), arising out of or resulting from (x)
execution, delivery, performance                     or enforcement of the Transaction
Documents or any other certificate, instrument                     or document
contemplated hereby or thereby, (y) any transaction financed or to                     be
financed in whole or in part, directly or indirectly, with the proceeds of
                    the issuance of the Securities, or (z) the status of such Indemnified
Party as                     holder of the Securities (unless such action is primarily
based, including in                     part, upon a breach of the Investor&#146;s
representations, warranties or                     covenants under the Transaction
Documents or any conduct by the Investor which                     constitutes fraud,
gross negligence or willful misconduct) or (iv) any untrue or                     alleged
untrue statement of a material fact contained in the Registration
                    Statement, any Prospectus or any form of Company prospectus or in any
amendment                     or supplement thereto or in any Company preliminary
prospectus, or arising out                     of or relating to any omission or alleged
omission of a material fact required                     to be stated therein or
necessary to make the statements therein (in the case of                     any
Prospectus or form of prospectus or supplement thereto, in the light of the
                    circumstances under which they were made) not misleading, except to
the extent,                     but only to the extent, that (A)&nbsp;such untrue
statements, alleged untrue                     statements, omissions or alleged omissions
are based solely upon information                     regarding the Investor furnished in
writing to the Company by the Investor for                     use therein, or to the
extent that such information relates to the Investor or                     the Investor&#146;s
proposed method of distribution of Registrable Securities                     and was
reviewed and expressly approved by the Investor or counsel to the
                    Investor expressly for use in the Registration Statement, or (B) with
respect to                     any prospectus, if the untrue statement or omission of
material fact contained                     in such prospectus was corrected on a timely
basis in the prospectus, as then                     amended or supplemented, if such
corrected prospectus was timely made available                     by the Company to the
Investor, and the Investor seeking indemnity hereunder was                     advised in
writing not to use the incorrect prospectus prior to the use giving
                    rise to Losses.  </font>
</td>
</tr>
</table>
<br>

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<font size=2>29</font></p>
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<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)
<U>Indemnification by the Investor</u>. The Investor shall indemnify and hold
                    harmless the Company, its directors, officers, agents and employees,
each Person                     who controls the Company (within the meaning of Section&nbsp;15
of the                     Securities Act and Section&nbsp;20 of the Exchange Act), and
the directors,                     officers, agents or employees of such controlling
Persons, to the fullest extent                     permitted by applicable law, from and
against all Losses (as determined by a                     court of competent
jurisdiction in a final judgment not subject to appeal or                     review)
arising solely out of any untrue statement of a material fact contained
                    in the Registration Statement, any Prospectus, or any form of
prospectus, or in                     any amendment or supplement thereto, or arising out
of or relating to any                     omission of a material fact required to be
stated therein or necessary to make                     the statements therein (in the
case of any Prospectus or form of prospectus or                     supplement thereto,
in the light of the circumstances under which they were                     made) not
misleading, but only to the extent that such untrue statement or
                    omission is contained in any information so furnished by the Investor
in writing                     to the Company specifically for inclusion in such
Registration Statement or such                     Prospectus or to the extent that (i)&nbsp;such
untrue statements or omissions                     are based solely upon information
regarding the Investor furnished to the                     Company by the Investor in
writing expressly for use therein, or to the extent                     that such
information relates to the Investor or the Investor&#146;s proposed
                    method of distribution of Registrable Securities and was reviewed and
expressly                     approved by the Investor or its counsel expressly for use
in the Registration                     Statement (it being understood that the
information provided by the Investor to                     the Company in <U>Exhibits A-1</u>,
<U>A-2</u> and <U>A-3</u> and the Plan of                     Distribution set forth on
<U>Exhibit C</u>, as the same may be modified by the                     Investor
pursuant hereto and other information provided by the Investor to the
                    Company in or pursuant to the Transaction Documents constitutes
information                     reviewed and expressly approved by the Investor or its
counsel in writing                     expressly for use in the Registration Statement),
such Prospectus or such form                     of Prospectus or in any amendment or
supplement thereto. In no event shall the                     liability of the Investor
hereunder be greater in amount than the dollar amount                     of the net
proceeds received by the Investor upon the sale of the Registrable
                    Securities giving rise to such indemnification obligation.  </font>
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<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)
<U>Conduct of Indemnification Proceedings</u>. If any Proceeding shall be
                    brought or asserted against any Person entitled to indemnity
hereunder (an                     &#147;<B>Indemnified Party</b>&#148;), such Indemnified
Party shall promptly                     notify the Person from whom indemnity is sought
(the <B>&#147;Indemnifying                     Party</b>&#148;) in writing, and the
Indemnifying Party shall assume the defense                     thereof, including the
employment of counsel reasonably satisfactory to the                     Indemnified
Party and the payment of all fees and expenses incurred in                     connection
with defense thereof; <U>provided</u>, that the failure of any
                    Indemnified Party to give such notice shall not relieve the
Indemnifying Party                     of its obligations or liabilities pursuant to this
Agreement, except (and only)                     to the extent that it shall be finally
determined by a court of competent                     jurisdiction (which determination
is not subject to appeal or further review)                     that such failure shall
have proximately and materially adversely prejudiced the                     Indemnifying
Party.  </font>
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</table>
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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;An
Indemnified Party shall have the right to employ separate counsel in any such Proceeding
and to participate in the defense thereof, but the fees and expenses of such counsel shall
be at the expense of such Indemnified Party or Parties unless: (i)&nbsp;the Indemnifying
Party has agreed in writing to pay such fees and expenses; or (ii)&nbsp;the Indemnifying
Party shall have failed promptly to assume the defense of such Proceeding and to employ
counsel reasonably satisfactory to such Indemnified Party in any such Proceeding; or
(iii)&nbsp;the named parties to any such Proceeding (including any impleaded parties)
include both such Indemnified Party and the Indemnifying Party, and such Indemnified Party
shall have been advised by counsel that a conflict of interest is likely to exist if the
same counsel were to represent such Indemnified Party and the Indemnifying Party (in which
case, if such Indemnified Party notifies the Indemnifying Party in writing that it elects
to employ separate counsel at the expense of the Indemnifying Party, the Indemnifying
Party shall not have the right to assume the defense thereof and the reasonable fees and
expenses of separate counsel shall be at the expense of the Indemnifying Party). It being
understood, however, that the Indemnifying Party shall not, in connection with any one
such Proceeding (including separate Proceedings that have been or will be consolidated
before a single judge) be liable for the fees and expenses of more than one separate firm
of attorneys at any time for all Indemnified Parties, which firm shall be appointed by a
majority of the Indemnified Parties. The Indemnifying Party shall not be liable for any
settlement of any such Proceeding effected without its written consent, which consent
shall not be unreasonably withheld or delayed. No Indemnifying Party shall, without the
prior written consent of the Indemnified Party, effect any settlement of any pending
Proceeding in respect of which any Indemnified Party is a party, unless such settlement
includes an unconditional release of such Indemnified Party from all liability on claims
that are the subject matter of such Proceeding. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;All
reasonable fees and expenses of the Indemnified Party (including reasonable fees and
expenses to the extent incurred in connection with investigating or preparing to defend
such Proceeding in a manner not inconsistent with this <U>Section</u>) shall be paid to
the Indemnified Party, as incurred, within twenty (20) Trading Days of written notice
thereof to the Indemnifying Party (regardless of whether it is ultimately determined that
an Indemnified Party is not entitled to indemnification hereunder; provided, that the
Indemnifying Party may require such Indemnified Party to undertake to reimburse all such
fees and expenses to the extent it is finally judicially determined that such Indemnified
Party is not entitled to indemnification hereunder). </font></p>

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<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)
<U>Contribution</u>. If a claim for indemnification under <U>Section 6.4(a</u>), <U>(b</u>)
or <U>(c)</u> is unavailable to an Indemnified Party (by reason of
                    public policy or otherwise), then each Indemnifying Party, in lieu of
                    indemnifying such Indemnified Party, shall contribute to the amount
paid or                     payable by such Indemnified Party as a result of such Losses,
in such proportion                     as is appropriate to reflect the relative fault of
the Indemnifying Party and                     Indemnified Party in connection with the
actions, statements or omissions that                     resulted in such Losses as well
as any other relevant equitable considerations.                     The relative fault of
such Indemnifying Party and Indemnified Party shall be                     determined by
reference to, among other things, whether any action in question,
                    including any untrue or alleged untrue statement of a material fact
or omission                     or alleged omission of a material fact, has been taken or
made by, or relates to                     information supplied by, such Indemnifying
Party or Indemnified Party, and the                     parties&#146; relative intent,
knowledge, access to information and opportunity                     to correct or
prevent such action, statement or omission. The amount paid or
                    payable by a party as a result of any Losses shall be deemed to
include, subject                     to the limitations set forth in <U>Section 6.4(c</u>),
any reasonable                     attorneys&#146; or other reasonable fees or expenses
incurred by such party in                     connection with any Proceeding to the
extent such party would have been                     indemnified for such fees or
expenses if the indemnification provided for in                     this <U>Section</u> was
available to such party in accordance with its terms.  </font>
</td>
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</table>
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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
parties hereto agree that it would not be just and equitable if contribution pursuant to
this <U>Section 6.4(d</u>) were determined by pro rata allocation or by any other method
of allocation that does not take into account the equitable considerations referred to in
the immediately preceding paragraph. Notwithstanding the provisions of this <U>Section
6.4(d</u>), the Investor shall not be required to contribute, in the aggregate, any amount
in excess of the amount by which the proceeds actually received by the Investor from the
sale of the Registrable Securities subject to the Proceeding exceeds the amount of any
damages that the Investor has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. No Person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be
entitled to contribution from any Person who was not guilty of such fraudulent
misrepresentation. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
indemnity and contribution agreements contained in this <U>Section</u> are in addition to
any liability that the Indemnifying Parties may have to the Indemnified Parties. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.5
<U>Dispositions</u>. The Investor agrees that it will comply with the prospectus delivery
requirements of the Securities Act as applicable to it in connection with sales of
Registrable Securities pursuant to the Registration Statement and shall sell its
Registrable Securities in accordance with the Plan of Distribution set forth in the
Prospectus. The Investor further agrees that, upon receipt of a notice from the Company
of the occurrence of any event of the kind described in <U>Sections 6.2(c)(v</u>), <U>(vi</u>)
or <U>(vii</u>), the Investor will discontinue disposition of such Registrable Securities
under the Registration Statement until the Investor is advised in writing by the Company
that the use of the Prospectus, or amended Prospectus, as applicable, may be used. The
Company may provide appropriate stop orders to enforce the provisions of this paragraph.  </font></p>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.6
<U>No Piggyback on Registrations</u>. Neither the Company nor any of its security holders
(other than the Investor in such capacity pursuant hereto) may include securities of the
Company in the Registration Statement other than the Registrable Securities. The parties
acknowledge that the Company may choose to include, at its option and solely for its
convenience, the Registrable Securities on a registration statement with other similar
securities, but only if, subject to Section 7.5 below, to do so would not adversely
affect the Investor.  </font></p>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.7
<U>Piggy-Back Registrations</u>. If at any time during the Effectiveness Period there is
not an effective Registration Statement covering all of the Registrable Securities and
the Company shall determine to prepare and file with the SEC a registration statement
relating to an offering for its own account or the account of others under the Securities
Act of any of its equity securities, other than on Form F-4 or Form S-8 (each as
promulgated under the Securities Act) or their then equivalents relating to equity
securities to be issued solely in connection with any acquisition of any entity or
business or equity securities issuable in connection with stock option or other employee
benefit plans, then the Company shall send to the Investor, if the Investor is not then
eligible to sell all of its Registrable Securities under Rule 144 in a three (3) month
period, written notice of such determination and if, within ten (10) days after receipt
of such notice, the Investor shall so request in writing, the Company shall include in
such registration statement all or any part of such Registrable Securities the Investor
requests to be registered. Notwithstanding the foregoing, in the event that, in
connection with any underwritten public offering, the managing underwriter(s) thereof
shall impose a limitation on the number of Ordinary Shares which may be included in the
Registration Statement because, in such underwriter(s)&#146;judgment, marketing or other
factors dictate such limitation is necessary to facilitate public distribution, then the
Company shall be obligated to include in such Registration Statement only such limited
portion of the Registrable Securities with respect to which the Investor has requested
inclusion hereunder as the underwriter shall permit; <U>provided<I></i></u>, <U>however</u>,
that (i) the Company shall not exclude any Registrable Securities unless the Company has
first excluded all outstanding securities, the holders of which are not contractually
entitled to inclusion of such securities in such Registration Statement or are not
contractually entitled to pro rata inclusion with the Registrable Securities and (ii)
after giving effect to the immediately preceding proviso, any such exclusion of
Registrable Securities shall be made pro rata among the Investor seeking to include
Registrable Securities and the holders of other securities having the contractual right
to inclusion of their securities in such Registration Statement, in proportion to the
number of Registrable Securities or other securities, as applicable, sought to be
included by the Investor or other holder. If an offering in connection with which the
Investor is entitled to registration under this <U>Section 6.7</u> is an underwritten
offering, then the Investor shall, unless otherwise agreed by the Company, offer and sell
such Registrable Securities in an underwritten offering using the same underwriter or
underwriters and, subject to the provisions of this Agreement, on the same terms and
conditions as other Ordinary Shares included in such underwritten offering and shall
enter into an underwriting agreement in a form and substance reasonably satisfactory to
the Company and the underwriter or underwriters. Upon the effectiveness of the
registration statement for which piggy-back registration has been provided in this <U>Section
6.7</u>, any Event Payments payable to the Investor whose Securities are included in such
registration statement shall terminate.  </font></p>

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<P Align="Center"><Font Face="Times New Roman, Times, Serif" Size=2>ARTICLE VII </font><Br>
<Font Face="Times New Roman, Times, Serif" Size=2>MISCELLANEOUS </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.1
<U>Termination</u>. This Agreement may be terminated by the Company or the Investor, by
written notice to the other party, if the Closing has not been consummated by the third
Business Day following the date of this Agreement; <U>provided</u>, that no such
termination will affect the right of any party to sue for any breach by the other party.  </font></p>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.2
<U>Fees and Expenses</u>. Except as expressly set forth in the Transaction Documents to
the contrary, each party shall pay the fees and expenses of its advisers, counsel,
accountants and other experts, if any, and all other expenses incurred by such party
incident to the negotiation, preparation, execution, delivery and performance of this
Agreement. The Company shall pay all Transfer Agent fees, stamp taxes and other taxes and
duties levied in connection with the sale and issuance of their applicable Securities.  </font></p>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.3
<U>Entire Agreement</u>. The Transaction Documents, together with the <U>Exhibits</u> and
<U>Schedules </u>thereto, contain the entire understanding of the parties with respect to
the subject matter hereof and supersede all prior agreements and understandings, oral or
written, with respect to such matters, which the parties acknowledge have been merged
into such documents, exhibits and schedules. At or after the Closing, and without further
consideration, the Company and the Investor will execute and deliver to the other such
further documents as may be reasonably requested in order to give practical effect to the
intention of the parties under the Transaction Documents.  </font></p>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.4
<U>Notices</u>. Any and all notices or other communications or deliveries required or
permitted to be provided hereunder shall be in writing and shall be deemed given and
effective on the earliest of (a)&nbsp;the date of transmission, if such notice or
communication is delivered via facsimile or email at the facsimile number or email
address specified in this <U>Section&nbsp;7.4</u> prior to 5:00 p.m. (New York City time)
on a Business Day, (b)&nbsp;the next Business Day after the date of transmission, if such
notice or communication is delivered via facsimile or email at the facsimile number or
email address specified in this <U>Section 7.4</u> on a day that is not a Business Day or
later than 5:00 p.m. (New York City time) on any Business Day, (c)&nbsp;the second
Business Day following the date of deposit with a nationally recognized overnight courier
service, or (d)&nbsp;upon actual receipt by the party to whom such notice is required to
be given. The addresses, facsimile numbers and email addresses for such notices and
communications are those set forth on the signature pages hereof, or such other address
or facsimile number as may be designated in writing hereafter, in the same manner, by any
such Person.  </font></p>

<p align=center>
<font size=2>33</font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.5
<U>Amendments; Waivers</u>. No provision of this Agreement may be waived or amended
except in a written instrument signed, in the case of an amendment, by the Company and
the Investor or, in the case of a waiver, by the party against whom enforcement of any
such waiver is sought. No waiver of any default with respect to any provision, condition
or requirement of this Agreement shall be deemed to be a continuing waiver in the future
or a waiver of any subsequent default or a waiver of any other provision, condition or
requirement hereof, nor shall any delay or omission of either party to exercise any right
hereunder in any manner impair the exercise of any such right. Notwithstanding the
foregoing, a waiver or consent to depart from the provisions hereof with respect to a
matter that relates exclusively to the rights of the Investor under <U>Article VI</u> shall
not be unreasonably withheld by the Investor (it is understood and agreed that consent or
waiver shall be deemed to be unreasonably withheld by the Investor under this Section 7.5
if the Registrable Securities are included on a registration statement with other similar
securities in accordance with Section 6.6 above and a majority in interest of the third
party shareholders whose securities are included on such registration statement give a
consent or waiver with respect to a provision in their separate agreements with the
Company that is similar to the provisions contained in <U>Article VI </u>hereof).  </font></p>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.6
<U>Construction</u>. The headings herein are for convenience only, do not constitute a
part of this Agreement and shall not be deemed to limit or affect any of the provisions
hereof. The language used in this Agreement will be deemed to be the language chosen by
the parties to express their mutual intent, and no rules of strict construction will be
applied against any party.  </font></p>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.7
<U>Successors and Assigns</u>. This Agreement shall be binding upon and inure to the
benefit of the parties and their successors and permitted assigns. The Company may not
assign this Agreement or any rights or obligations hereunder without the prior written
consent of the Investor. The Investor may assign its rights under this Agreement to any
Person to whom the Investor assigns or transfers any Securities, provided (i) such
transferor agrees in writing with the transferee or assignee to assign such rights, and a
copy of such agreement is furnished to the Company after such assignment, (ii) the
Company is furnished with written notice of (x) the name and address of such transferee
or assignee and (y) the Registrable Securities with respect to which such registration
rights are being transferred or assigned, (iii) following such transfer or assignment,
the further disposition of such securities by the transferee or assignee is restricted
under the Securities Act and applicable state securities laws and Israeli securities
laws, (iv) such transferee agrees in writing to be bound, with respect to the transferred
Securities, by the provisions hereof that apply to the &#147;Investor&#148; and (v) such
transfer shall have been made in accordance with the applicable requirements of this
Agreement and with all laws applicable thereto.  </font></p>

<p align=center>
<font size=2>34</font></p>
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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.8
<U>No Third-Party Beneficiaries</u>. This Agreement is intended for the benefit of the
parties hereto and their respective successors and permitted assigns and is not for the
benefit of, nor may any provision hereof be enforced by, any other Person, except that
each Indemnified Party is an intended third party beneficiary of <U>Section&nbsp;6.4</u> and
(in each case) may enforce the provisions of such Sections directly against the parties
with obligations thereunder.  </font></p>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.9
<U>Governing Law; Venue; Waiver of Jury Trial</u>. THE CORPORATE LAWS OF THE STATE OF
ISRAEL SHALL GOVERN ALL ISSUES CONCERNING THE RELATIVE RIGHTS OF THE COMPANY AND ITS
STOCKHOLDERS. ALL QUESTIONS CONCERNING THE CONSTRUCTION, VALIDITY, ENFORCEMENT AND
INTERPRETATION OF THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK. THE COMPANY AND THE INVESTOR HEREBY IRREVOCABLY SUBMIT
TO THE NON-EXCLUSIVE JURISDICTION OF THE STATE AND FEDERAL COURTS SITTING IN THE CITY OF
NEW YORK, BOROUGH OF MANHATTAN FOR THE ADJUDICATION OF ANY DISPUTE BROUGHT BY THE COMPANY
OR THE INVESTOR HEREUNDER, IN CONNECTION HEREWITH OR WITH ANY TRANSACTION CONTEMPLATED
HEREBY OR DISCUSSED HEREIN (INCLUDING WITH RESPECT TO THE ENFORCEMENT OF ANY OF THE
TRANSACTION DOCUMENTS), AND HEREBY IRREVOCABLY WAIVE, AND AGREE NOT TO ASSERT IN ANY
SUIT, ACTION OR PROCEEDING BROUGHT BY THE COMPANY OR THE INVESTOR, ANY CLAIM THAT IT IS
NOT PERSONALLY SUBJECT TO THE JURISDICTION OF ANY SUCH COURT, OR THAT SUCH SUIT, ACTION
OR PROCEEDING IS IMPROPER. EACH PARTY HEREBY IRREVOCABLY WAIVES PERSONAL SERVICE OF
PROCESS AND CONSENTS TO PROCESS BEING SERVED IN ANY SUCH SUIT, ACTION OR PROCEEDING BY
MAILING A COPY THEREOF VIA REGISTERED OR CERTIFIED MAIL OR OVERNIGHT DELIVERY (WITH
EVIDENCE OF DELIVERY) TO SUCH PARTY AT THE ADDRESS IN EFFECT FOR NOTICES TO IT UNDER THIS
AGREEMENT AND AGREES THAT SUCH SERVICE SHALL CONSTITUTE GOOD AND SUFFICIENT SERVICE OF
PROCESS AND NOTICE THEREOF. NOTHING CONTAINED HEREIN SHALL BE DEEMED TO LIMIT IN ANY WAY
ANY RIGHT TO SERVE PROCESS IN ANY MANNER PERMITTED BY LAW. THE COMPANY AND THE INVESTOR
HEREBY WAIVE ALL RIGHTS TO A TRIAL BY JURY.  </font></p>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;THE
COMPANY DESIGNATES AND APPOINTS SILICOM CONNECTIVITY SOLUTIONS, INC., WHICH CURRENTLY
MAINTAINS AN OFFICE AT 6 FOREST AVE., PARAMUS, NEW JERSEY, AS ITS AUTHORIZED AGENT UPON
WHICH PROCESS MAY BE SERVED IN ANY SUCH SUIT OR PROCEEDING, AND AGREES THAT SERVICE OF
PROCESS UPON SUCH AGENT, AND WRITTEN NOTICE OF SAID SERVICE TO THE COMPANY BY THE PERSON
SERVING THE SAME TO THE ADDRESS PROVIDED IN SECTION 7.4 SHALL BE DEEMED IN EVERY RESPECT
EFFECTIVE SERVICE OF PROCESS UPON THE COMPANY IN ANY SUCH SUIT OR PROCEEDING. SUCH
DESIGNATION AND APPOINTMENT SHALL BE IRREVOCABLE, UNLESS AND UNTIL A SUCCESSOR AUTHORIZED
AGENT SHALL HAVE BEEN APPOINTED BY THE COMPANY, SUCH SUCCESSOR SHALL HAVE ACCEPTED SUCH
APPOINTMENT AND WRITTEN NOTICE THEREOF SHALL HAVE BEEN GIVEN TO THE INVESTOR. THE COMPANY
FURTHER AGREES TO TAKE ANY AND ALL ACTIONS AS MAY BE NECESSARY TO MAINTAIN SUCH
DESIGNATION AND APPOINTMENT OF SUCH AGENT IN FULL FORCE AND EFFECT FOR A PERIOD OF THREE
YEARS FROM THE DATE OF THIS AGREEMENT. </font></p>

<p align=center>
<font size=2>35</font></p>
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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.10
    <U>Survival</u>.  The  representations  and warranties,  agreements and covenants  contained
 herein shall survive the Closing. </font></p>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.11
<U>Execution</u>. This Agreement may be executed in two or more counterparts, all of
which when taken together shall be considered one and the same agreement and shall become
effective when counterparts have been signed by each party and delivered to the other
party, it being understood that both parties need not sign the same counterpart. In the
event that any signature is delivered by facsimile transmission or email attachment, such
signature shall create a valid and binding obligation of the party executing (or on whose
behalf such signature is executed) with the same force and effect as if such facsimile or
email-attached signature page were an original thereof.  </font></p>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.12
<U>Severability</u>. If any provision of this Agreement is held to be invalid or
unenforceable in any respect, the validity and enforceability of the remaining terms and
provisions of this Agreement shall not in any way be affected or impaired thereby and the
parties will attempt to agree upon a valid and enforceable provision that is a reasonable
substitute therefor, and upon so agreeing, shall incorporate such substitute provision in
this Agreement.  </font></p>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.13
<U>Rescission and Withdrawal Right</u>. Notwithstanding anything to the contrary
contained in (and without limiting any similar provisions of) the Transaction Documents,
whenever the Investor exercises a right, election, demand or option owed to the Investor
by the Company under a Transaction Document and the Company does not timely perform its
related obligations within the periods therein provided, then, prior to the performance
by the Company of the Company&#146;s related obligation, the Investor may rescind or
withdraw, in its sole discretion from time to time upon written notice to the Company,
any relevant notice, demand or election in whole or in part without prejudice to its
future actions and rights.  </font></p>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.14
<U>Replacement of Securities</u>. If any certificate or instrument evidencing any
Securities is mutilated, lost, stolen or destroyed, the Company shall issue or cause to
be issued in exchange and substitution for and upon cancellation thereof, or in lieu of
and substitution therefor, a new certificate or instrument, but only upon receipt of
evidence reasonably satisfactory to the Company of such loss, theft or destruction and
the execution by the holder thereof of a customary lost certificate affidavit of that
fact and an agreement to indemnify and hold harmless the Company for any losses in
connection therewith. The applicants for a new certificate or instrument under such
circumstances shall also pay any reasonable third-party costs associated with the
issuance of such replacement Securities.  </font></p>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.15
<U>Remedies</u>. In addition to being entitled to exercise all rights provided herein or
granted by law, including recovery of damages, the Investor and the Company will be
entitled to seek specific performance under the Transaction Documents. The parties agree
that monetary damages may not be adequate compensation for any loss incurred by reason of
any breach of obligations described in the foregoing sentence and hereby agrees to waive
in any action for specific performance of any such obligation (other than in connection
with any action for temporary restraining order) the defense that a remedy at law would
be adequate.  </font></p>

<p align=center>
<font size=2>36</font></p>
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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.16
<U>Payment Set Aside</u>. To the extent that the Company makes a payment or payments to
the Investor hereunder or the Investor enforces or exercises its rights hereunder or
thereunder, and such payment or payments or the proceeds of such enforcement or exercise
or any part thereof are subsequently invalidated, declared to be fraudulent or
preferential, set aside, recovered from, disgorged by or are required to be refunded,
repaid or otherwise restored to the Company by a trustee, receiver or any other person
under any law (including, without limitation, any bankruptcy law, state or federal law,
common law or equitable cause of action), then to the extent of any such restoration,
subject to applicable law, the obligation or part thereof originally intended to be
satisfied shall be revived and continued in full force and effect as if such payment had
not been made or such enforcement or setoff had not occurred.  </font></p>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.17
<U>Adjustments in Share Numbers and Prices</u>. In the event of any stock split,
subdivision, dividend or distribution payable in Ordinary Shares (or other securities or
rights convertible into, or entitling the holder thereof to receive directly or
indirectly Ordinary Shares), combination or other similar recapitalization or event
occurring after the date hereof and prior to the Closing, each reference in any
Transaction Document to a number of shares or a price per share shall be amended to
appropriately account for such event.  </font></p>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.18
<U>Independent Nature of the Investor&#146;s Obligations and Rights</u>. The obligations
of the Investor under each Transaction Document are several and not joint with the
obligations of any other third party purchaser of the Company&#146;s securities, and the
Investor shall not be responsible in any way for the performance of the obligations of
any other third party purchaser of the Company&#146;s securities. The decision of the
Investor to purchase Securities pursuant to this Agreement has been made by the Investor
independently of any other third party purchaser of the Company&#146;s securities.
Nothing contained herein or in any other Transaction Document, and no action taken by the
Investor pursuant thereto, shall be deemed to constitute the Investor and any third party
purchaser of the Company&#146;s securities as a partnership, an association, a joint
venture or any other kind of entity or group, or create a presumption that the Investor
and any third party purchaser of the Company&#146;s securities are in any way acting in
concert or as a group with respect to any matters. The Investor acknowledges that no
other third party purchaser of the Company&#146;s securities has acted as agent for the
Investor in connection with making its investment hereunder and that no third party
purchaser of the Company&#146;s securities will be acting as agent of the Investor in
connection with monitoring its investment in the Securities or enforcing its rights under
the Transaction Documents. The Investor shall be entitled to independently protect and
enforce its rights, (including, without limitation, the rights arising out of this
Agreement or out of the other Transaction Documents) and it shall not be necessary for
any third party purchaser of the Company&#146;s securities to be joined as an additional
party in any proceeding for such purpose. To the extent that any such third party
purchasers purchase the same or similar securities as the Investor hereunder or on the
same or similar terms and conditions or pursuant to the same or similar documents, all
such matters are solely in the control of the Company, not the action or decision of the
Investor, and would be solely for the convenience of the Company and not because it was
required or requested to do so by the Investor or any such third party purchaser.  </font></p>

<p align=center>
<font size=2>37</font></p>
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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.19
<U>Delivery of Securities</u>. Notwithstanding anything contained in this Agreement or
any other Transaction Document to the contrary, unless otherwise directed in writing by&nbsp;the&nbsp;Investor,
all of&nbsp;the Investor&#146;s securities purchased pursuant to this Agreement (and all
securities which are issuable to&nbsp;the Investor pursuant to the terms of this
Agreement or any other agreement or instrument entered into, or delivered, in connection
with execution of this Agreement or the consummation of the transaction contemplated
hereby) shall be registered in the name of the Investor, and the Company shall, and shall
cause its agents and representatives to, deliver all certificates representing such
securities to Goldman, Sachs &amp; Co., One New York Plaza, New York, New York 10004,
Attention: Alexander Tudor, and copies of all certificates representing such securities
shall be sent to&nbsp;the Investor in accordance with Section&nbsp;7.4 of this Agreement.  </font></p>


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<P Align=CENTER><Font Face="Times New Roman, Times, Serif" Size=2>[SIGNATURE PAGES TO
FOLLOW] </font></p>

<p align=center>
<font size=2>38</font></p>
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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;IN
WITNESS WHEREOF, the parties hereto have caused this Securities Purchase Agreement to be
duly executed by their respective authorized signatories as of the date first indicated
above. </font></p>

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<td Width=40%><Font Face="Times New Roman, Times, Serif" Size=2></font></td>
<td Width=10%><Font Face="Times New Roman, Times, Serif" Size=2></font></td>
<td Width=50%><Font Face="Times New Roman, Times, Serif" Size=2>SILICOM LTD.<Br><Br>
<br>By: <br>&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;<br>
Name:<br>Title:<Br><Br>Address for Notice:<Br><Br>Facsimile No.:<Br>Telephone No.:<Br>Attn:</font></td>
</tr>
</table>
<br>


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<td Width=15%>&nbsp;</td>
<td Width=85%><Font Face="Times New Roman, Times, Serif" Size=2>
With
a copy to (which shall not constitute notice):<Br>
                                    Facsimile:<Br>
                                    Telephone:    <Br>                                 Attn: </font></td>
</tr>
</table>
<br>


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<td Width=40%><Font Face="Times New Roman, Times, Serif" Size=2></font></td>
<td Width=10%><Font Face="Times New Roman, Times, Serif" Size=2></font></td>
<td Width=50%><Font Face="Times New Roman, Times, Serif" Size=2>CD Investment Partners, Ltd.<Br><Br>
<br>By: <br>&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;<br>
Name:<br>Title:<Br><Br>Jurisdiction of Investor's<Br>Executive Offices: ________________
<Br><Br>Address: &nbsp;&nbsp;111   S.   Wacker    Drive, Suite 3950<Br>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Chicago, IL 60606<Br>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Attn: Investment Manager<Br>
Telephone No.: (312) 803-5011<Br>Facsimile No.: (312) 559-1288<Br>Email Address: john@cdcapital.com</font></td>
</tr>
</table>
<br>

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<font size=2></font></p>
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<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>


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<td Width=15%>&nbsp;</td>
<td Width=85%><Font Face="Times New Roman, Times, Serif" Size=2>
With
a copy to (which shall not constitute notice): </font></td>
</tr>
</table>
<br>

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<td Width=15%>&nbsp;</td>
<td Width=85%><Font Face="Times New Roman, Times, Serif" Size=2>
Greenberg
Traurig, LLP          <Br>                           Telephone: (312) 456-8400
                          <Br>          Facsimile: (312) 456-8435
                              <Br>      Attn: Peter H. Lieberman, Esq.
                                  <Br>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;           Todd A. Mazur, Esq. </font></td>
</tr>
</table>
<br>

<p align=center>
<font size=2>2</font></p>
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<P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>Exhibits: </font></p>

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<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>A  </font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>Instruction
Sheet for Investor </font></td>
</tr>
</table>


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<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>B  </font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>Opinion
of Company Counsel </font></td>
</tr>
</table>


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<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>C  </font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>Plan
of Distribution </font></td>
</tr>
</table>


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<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>D  </font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>Transfer
Agent Instructions </font></td>
</tr>
</table>


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<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>E  </font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>Form
of Warrant </font></td>
</tr>
</table>
<br>

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<font size=2></font></p>
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<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>


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<H1 Align=CENTER><Font Face="Times New Roman, Times, Serif" Size=2>Exhibit&nbsp;A </font></h1>

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<H1 Align=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><U>INSTRUCTION SHEET FOR
INVESTOR</U> </FONT> </h1>

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<P Align="Center"><Font Face="Times New Roman, Times, Serif" Size=2>(to
be read in conjunction with the entire Securities Purchase Agreement) </font></p>

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<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>A.  </font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2><U>Complete
the following items in the Securities Purchase Agreement</u>: </font></td>
</tr>
</table>
<br>

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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>1. </font></td>
<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>Complete
and execute the Investor Signature Page, The Agreement must be executed                by
an individual authorized to bind the Investor. </font></td>
</tr>
</table>
<br>

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<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>2. </font></td>
<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>Exhibit&nbsp;A-1
&#150; Stock Certificate Questionnaire: </font></td>
</tr>
</table>
<br>

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<td Width=5%>&nbsp;</td>
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<U>Provide
the information requested by the Stock Certificate Questionnaire</u>;  </font></td>
</tr>
</table>
<br>

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<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>3.</font></td>
<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>         Exhibit&nbsp;A-2
&#150; Registration Statement Questionnaire: </font></td>
</tr>
</table>
<br>

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<td Width=5%>&nbsp;</td>
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<U>Provide
the information requested by the Registration Statement Questionnaire</u>.  </font></td>
</tr>
</table>
<br>

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<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>4.</font></td>
<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>          Exhibit&nbsp;A-3
&#150; Investor Certificate: </font></td>
</tr>
</table>
<br>

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<td Width=5%>&nbsp;</td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>
Provide
the information requested by the Certificate for Individual Investors (A-3) or the
Certificate for Corporate, Partnership, Trust, Foundation and Joint Investors (A-4), as
applicable.  </font></td>
</tr>
</table>
<br>

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<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>5. </font></td>
<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>Return,
via facsimile, the signed Securities Purchase Agreement including the
               properly completed Exhibits A-1 through A-3, to: </font></td>
</tr>
</table>
<br>


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<td Width=15%>&nbsp;</td>
<td Width=85%><Font Face="Times New Roman, Times, Serif" Size=2>
Facsimile:
                              <Br>      Telephone:                       <Br>              Attn: </font></td>
</tr>
</table>
<br>


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<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>6. </font></td>
<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>After
completing instruction number five (5) above, deliver the original signed
               Securities Purchase Agreement including the properly completed Exhibits
               &nbsp;A-1 through A-3 to: </font></td>
</tr>
</table>
<br>


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<td Width=15%>&nbsp;</td>
<td Width=85%><Font Face="Times New Roman, Times, Serif" Size=2>
Facsimile:
                   <Br>                 Telephone:                   <Br>                  Attn: </font></td>
</tr>
</table>
<br>


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<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>B.  </font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>Instructions
regarding the wire transfer of funds for the purchase of the Shares                will
be telecopied to the Investor by the Company at a later date. </font></td>
</tr>
</table>
<br>

<p align=center>
<font size=2></font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>


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<H1 Align=CENTER><Font Face="Times New Roman, Times, Serif" Size=2>Exhibit&nbsp;A-1 </font></h1>

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<H1 Align=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><U>Silicom Ltd.</U> </FONT> </h1>

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<H1 Align=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><U>STOCK CERTIFICATE
QUESTIONNAIRE</U> </FONT> </h1>

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Please
provide us with the following information:  </font></td>
</tr>
</table>
<br>

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<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>1.  </font></td>
<td Width=65%><Font Face="Times New Roman, Times, Serif" Size=2>The
exact name that the Securities are to be registered in (this is the name           that
will appear on the stock certificate(s)). <Br>You may use a nominee name if
          appropriate: </font></td>
<Td Width="30%" Valign="Bottom"> <Font Face="Times New Roman, Times, Serif" Size=2>___________________________________  </font></td>
</tr>
</table>
<br>

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<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>2.  </font></td>
<td Width=65%><Font Face="Times New Roman, Times, Serif" Size=2>The
relationship between the Investor of the Securities and the Registered           Holder
listed in response to item 1 above: </font></td>
<Td Width="30%" Valign="Bottom"> <Font Face="Times New Roman, Times, Serif" Size=2>___________________________________  </font></td>
</tr>
</table>
<br>

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<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>3.  </font></td>
<td Width=65%><Font Face="Times New Roman, Times, Serif" Size=2>The
mailing address, telephone and telecopy number and email address of <Br>the
          Registered Holder listed in response to item 1 above: </font></td>
<Td Width="30%" Valign="Bottom"> <Font Face="Times New Roman, Times, Serif" Size=2><Br>___________________________________<Br><Br>___________________________________
<Br><Br>___________________________________
<Br><Br>___________________________________
<Br><Br>___________________________________
 </font></td>
</tr>
</table>
<br>

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<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>4.  </font></td>
<td Width=65%><Font Face="Times New Roman, Times, Serif" Size=2>The
United States Tax Identification Number of the Registered Holder listed in
          response to item 1 above: </font></td>
<Td Width="30%" Valign="Bottom"> <Font Face="Times New Roman, Times, Serif" Size=2>___________________________________  </font></td>
</tr>
</table>
<br>


<p align=center>
<font size=2></font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>



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<H1 Align=CENTER><Font Face="Times New Roman, Times, Serif" Size=2>Exhibit&nbsp;A-2 </font></h1>

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<H1 Align=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><U>Silicom Ltd.</U> </FONT> </h1>

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<H1 Align=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><U>REGISTRATION STATEMENT
QUESTIONNAIRE</U> </FONT> </h1>



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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
connection with the Registration Statement, please provide us with the following
information regarding the Investor. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>1. &nbsp;&nbsp;&nbsp;&nbsp;Please
state your or your organization&#146;s name exactly as it should appear           in the
Registration Statement:  </font></p>

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______________________________________________________________________  </font></td>
</tr>
</table>
<br>



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<td Width=5%>&nbsp;</td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>
Except
as set forth below, your organization does not hold any equity securities of the Company
on behalf of another person or entity.  </font></td>
</tr>
</table>
<br>

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State
any exceptions here:  </font></td>
</tr>
</table>
<br>

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______________________________________________________________________ </font></td>
</tr>
</table>
<br>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>2. &nbsp;&nbsp;&nbsp;&nbsp;Address
of your organization:  </font></p>


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<td Width=10%>&nbsp;</td>
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______________________________________________________ </font></td>
</tr>
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<br>

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______________________________________________________ </font></td>
</tr>
</table>
<br>

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Telephone:
 __________________________ </font></td>
</tr>
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<br>

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Fax:
 ________________________________ </font></td>
</tr>
</table>
<br>

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Contact
Person:  _______________________ </font></td>
</tr>
</table>
<br>



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<P><Font Face="Times New Roman, Times, Serif" Size=2>3. &nbsp;&nbsp;&nbsp;&nbsp;Have you
or your organization had any position, office or other material           relationship
within the past three years with the Company or its affiliates?           (Include any
relationships involving you or your affiliates, officers,           directors, or
principal equity holders (5% or more) that has held any position           or office or
has had any other material relationship with the Company (or its           predecessors
or affiliates) during the past three years.)  </font></p>


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_______ &nbsp;&nbsp; Yes  &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; _______ &nbsp;&nbsp;  No </font></td>
</tr>
</table>
<br>

<p align=center>
<font size=2></font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>


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<td Width=5%>&nbsp;</td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>
If
yes, please indicate the nature of any such relationship below:  </font></td>
</tr>
</table>
<br>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>4. &nbsp;&nbsp;&nbsp;&nbsp;Are you
or your organization the beneficial owner of any other securities of the
          Company? (Include any equity securities that you or your organization
          beneficially own or have a right to acquire within 60 days after the date
          hereof, and as to which you or your organization have sole voting power, shared
          voting power, sole investment power or shared investment power.)  </font></p>

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<td Width=5%>&nbsp;</td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>
_______ &nbsp;&nbsp; Yes  &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; _______ &nbsp;&nbsp;  No </font></td>
</tr>
</table>
<br>


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If
yes, please describe the nature and amount of such ownership as of a recent date.  </font></td>
</tr>
</table>
<br>

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<td Width=5%>&nbsp;</td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>
Do
you or your organization wish to disclaim beneficial ownership of any of the shares
reported above for purposes of the Registration Statement?  </font></td>
</tr>
</table>
<br>

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<td Width=5%>&nbsp;</td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>
_______ &nbsp;&nbsp; Yes  &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; _______ &nbsp;&nbsp;  No </font></td>
</tr>
</table>
<br>

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<td Width=5%>&nbsp;</td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>
Who
is the individual that exercises sole/shared voting/dispositive control over the shares
reported above? If such control is held by more that one individual, please state the
name of all individuals that participate in any such decision-making powers regarding
such shares.  </font></td>
</tr>
</table>
<br>

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<td Width=10%>&nbsp;</td>
<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>
______________________________________________________ </font></td>
</tr>
</table>
<br>

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<td Width=10%>&nbsp;</td>
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______________________________________________________ </font></td>
</tr>
</table>
<br>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>5. &nbsp;&nbsp;&nbsp;&nbsp;Except as
set forth below, you or your organization wish that all of the Shares           and
Warrant Shares beneficially owned by you or your organization that you or           your
organization, as applicable, have the right to acquire from the Company be
          offered for your or your organization account in the Registration Statement.  </font></p>

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<td Width=10%>&nbsp;</td>
<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>
State
any exceptions here:  </font></td>
</tr>
</table>
<br>

<p align=center>
<font size=2>2</font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>6. &nbsp;&nbsp;&nbsp;&nbsp;Have you
or your organization made or are you or your organization aware of any
          arrangements relating to the distribution of the Ordinary Shares of the Company
          pursuant to the Registration Statement?  </font></p>

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<td Width=5%>&nbsp;</td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>
_______ &nbsp;&nbsp; Yes  &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; _______ &nbsp;&nbsp;  No </font></td>
</tr>
</table>
<br>

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<td Width=5%>&nbsp;</td>
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If
yes, please describe the nature and amount of such arrangements.  </font></td>
</tr>
</table>
<br>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>7. &nbsp;&nbsp;&nbsp;&nbsp;NASD
Matters  </font></p>

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     <P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          State below whether (i) you or any <I>associate</i> or <I>affiliate</i> of yours
          are a <I>member</i> of the NASD, a <I>controlling</i> shareholder of an NASD
          <I>member</i>, a <I>person assoc</i>i<I>ated with a member</i>, a direct or
          indirect <I>affiliate</i> of a <I>member</i>, or an <I>underwriter or related
          person</i> with respect to the proposed offering; (ii) you or any
          <I>associate</i> or <I>affiliate</i> of yours owns any stock or other securities
          of any NASD <I>member</i> not purchased in the open market; or (iii) you or any
          <I>associate</i> or <I>affiliate</i> of yours has made any outstanding
          subordinated loans to any NASD <I>member</i>. If you are a general or limited
          partnership, a no answer asserts that no such relationship exists for you as
          well as for each of your general or limited partners. </font></p>


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_______ &nbsp;&nbsp; Yes  &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; _______ &nbsp;&nbsp;  No </font></td>
</tr>
</table>
<br>


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<td Width=5%>&nbsp;</td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>
If
&#147;yes,&#148; please identify the NASD <I>member</i> and describe your relationship,
including, in the case of a general or limited partner, the name of the partner:  </font></td>
</tr>
</table>
<br>

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<tr Valign=TOP>
<td Width=5%>&nbsp;</td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>
If
you answer &#147;no&#148; to Question 7(a), you need not respond to Question 7(b).  </font></td>
</tr>
</table>
<br>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;(b) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;State
below whether you or any <I>associate</i> or <I>affiliate</i> of yours has
                    been an underwriter, or a <I>controlling</i> person or member of any
investment                     banking or brokerage firm which has been or might be an
underwriter for                     securities of the Corporation or any <I>affiliate</i> thereof
including, but not                     limited to, the common stock now being registered.  </font></p>

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<tr Valign=TOP>
<td Width=5%>&nbsp;</td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>
_______ &nbsp;&nbsp; Yes  &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; _______ &nbsp;&nbsp;  No </font></td>
</tr>
</table>
<br>

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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=5%>&nbsp;</td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>
If
&#147;yes,&#148; please identify the NASD <I>member</i> and describe your relationship,
including, in the case of a general or limited partner, the name of the partner.  </font></td>
</tr>
</table>
<br>

<p align=center>
<font size=2>3</font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>



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<P Align=CENTER><Font Face="Times New Roman, Times, Serif" Size=2><U>ACKNOWLEDGEMENT </u></font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
undersigned hereby agrees to notify the Company promptly of any changes in the foregoing
information which should be made as a result of any developments, including the passage of
time. The undersigned also agrees to provide the Company and the Company&#146;s counsel
any and all such further information regarding the undersigned promptly upon request in
connection with the preparation, filing, amending, and supplementing of the Registration
Statement (or any prospectus contained therein). The undersigned hereby consents to the
use of all such information in the Registration Statement. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
undersigned understands and acknowledges that the Company will rely on the information set
forth herein for purposes of the preparation and filing of the Registration Statement. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
undersigned understands that the undersigned may be subject to serious civil and criminal
liabilities if the Registration Statement, when it becomes effective, either contains an
untrue statement of a material fact or omits to state a material fact required to be
stated in the Registration Statement or necessary to make the statements in the
Registration Statement not misleading. The undersigned represents and warrants that all
information it provides to the Company and its counsel is currently accurate and complete
and will be accurate and complete at the time the Registration Statement becomes effective
and at all times subsequent thereto, and agrees during the Effectiveness Period and any
additional period in which the undersigned is making sales of Shares under and pursuant to
the Registration Statement, and agrees during such periods to notify the Company
immediately of any misstatement of a material fact in the Registration Statement, and of
the omission of any material fact necessary to make the statements contained therein not
misleading. </font></p>


<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <Th> </th>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH></TR>
<TR VALIGN=Bottom>
     <Th> </th>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH></TR>
<TR VALIGN=Bottom>
     <Th> </th>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH></TR>
<TR VALIGN=Bottom>
     <Th> </th>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH></TR>
<TR VALIGN=Bottom>
     <Th> </th>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH></TR>
<TR VALIGN=Bottom>
     <Td WIDTH=5%> </td>
     <TD WIDTH=35% ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Dated: __________</FONT></TD>
     <TD WIDTH=60% ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <Td> </td>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>______________________________</FONT></TD></TR>
<TR VALIGN=Bottom>
     <Td> </td>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Name</FONT></TD></TR>
<TR VALIGN=Bottom>
     <Td> </td>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <Td> </td>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>______________________________</FONT></TD></TR>
<TR VALIGN=Bottom>
     <Td> </td>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Signature</FONT></TD></TR>
<TR VALIGN=Bottom>
     <Td> </td>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <Td> </td>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>______________________________</FONT></TD></TR>
<TR VALIGN=Bottom>
     <Td> </td>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Name and Title of Signatory</FONT></TD></TR>
</TABLE>
<Br>

<p align=center>
<font size=2>4</font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>

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<H1 Align=CENTER><Font Face="Times New Roman, Times, Serif" Size=2>Exhibit&nbsp;A-3 </font></h1>

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<H1 Align=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><U>Silicom Ltd.</U> </FONT> </h1>

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<H1 Align=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><U>CERTIFICATE FOR
CORPORATE, PARTNERSHIP, LIMITED LIABILITY COMPANY, <BR>TRUST, FOUNDATION AND JOINT
INVESTORS</U> </FONT> </h1>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If
the investor is a corporation, partnership, limited liability company, trust, pension
plan, foundation, joint Investor (other than a married couple) or other entity, an
authorized officer, partner, or trustee must complete, date and sign this Certificate. </font></p>

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<H1 Align=CENTER><Font Face="Times New Roman, Times, Serif" Size=2><U>CERTIFICATE</u> </font></h1>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
undersigned certifies that the representations and responses below are true and accurate: </font></p>

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     <P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          The investor has been duly formed and is validly existing and has full power and
          authority to invest in the Company. The person signing on behalf of the
          undersigned has the authority to execute and deliver the Securities Purchase
          Agreement on behalf of the Investor and to take other actions with respect
          thereto. </font></p>

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     <P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          Indicate the form of entity of the undersigned: </font></p>

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<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;____
    Limited Partnership </font>
</td>
</tr>
</table>
<br>

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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;____
    General Partnership </font>
</td>
</tr>
</table>
<br>

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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;____
    Limited Liability Company </font>
</td>
</tr>
</table>
<br>

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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;____
    Corporation </font>
</td>
</tr>
</table>
<br>

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<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=95%><FONT FACE="Times New Roman, Times, Serif" SIZE="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;____
Revocable Trust (identify each grantor and indicate under what circumstances the trust is revocable by the grantor):
<U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><Br>
 </FONT>
</td>
</tr>
</table>



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<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
_____________________________________________________________________________________________________________________________________________________________________<Br>
(Continue on a separate piece of paper, if necessary.) </font>
</td>
</tr>
</table>
<br>




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<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;____
Other type of Trust (indicate type of trust and, for trusts other than pension trusts,
name the grantors and beneficiaries):  <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>
</font>
</td>
</tr>
</table>





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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
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<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
_____________________________________________________________________________________________________________________________________________________________________<Br>(Continue
on a separate piece of paper, if necessary.) </font>
</td>
</tr>
</table>
<br>


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<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;____
    Other form of organization (indicate form of organization
(____________________________________________________). </font>
</td>
</tr>
</table>
<br>

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     <P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          Indicate the approximate date the undersigned entity was formed: <U> </u>. </font></p>

<p align=center>
<font size=2>5</font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>


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     <P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          In order for the Company to offer and sell the Units in conformance with state
          and federal securities laws, the following information must be obtained
          regarding your investor status. Please <U>initial each category</u> applicable
          to you as an investor in the Company. </font></p>

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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>___ </font></td>
<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>1. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
A bank as defined in Section 3(a)(2) of the Securities Act, or any savings and loan
association or other institution as defined in Section 3(a)(5)(A) of the Securities Act
whether acting in its individual or fiduciary capacity; </font></td>
</tr>
</table>
<br>

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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>         ___  </font></td>
<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>2. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
      A  broker  or  dealer  registered  pursuant  to  Section 15  of the  Securities
                  Exchange Act of 1934;</font></td>
</tr>
</table>
<br>

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<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>         ___  </font></td>
<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>3. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
      An insurance company as defined in Section 2(13) of the Securities Act;</font></td>
</tr>
</table>
<br>

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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>         ___  </font></td>
<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>4. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
      An investment  company registered under the Investment Company Act of 1940 or a
                  business development company as defined in Section  2(a)(48) of that
Act;</font></td>
</tr>
</table>
<br>

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<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>         ___  </font></td>
<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>5. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
      A Small  Business  Investment  Company  licensed  by the  U.S.  Small  Business
                  Administration  under  Section 301(c)  or (d) of the Small  Business
 Investment  Act of                   1958;</font></td>
</tr>
</table>
<br>

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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>         ___  </font></td>
<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>6. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
      A plan  established and maintained by a state, its political  subdivisions,  or
                  any  agency  or  instrumentality  of a  state  or its  political
 subdivisions,  for the                   benefit of its employees, if such plan has
total assets in excess of $5,000,000;</font></td>
</tr>
</table>
<br>

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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>___ </font></td>
<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>7. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
An employee benefit plan within the meaning of the Employee Retirement Income Security
Act of 1974, if the investment decision is made by a plan fiduciary, as defined in Section&nbsp;3(21)
of such Act, which is either a bank, savings and loan association, insurance company, or
registered investment advisor, or if the employee benefit plan has total assets in excess
of $5,000,000 or, if a self-directed plan, with investment decisions made solely by
persons that are accredited investors; </font></td>
</tr>
</table>
<br>

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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>         ___  </font></td>
<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>8. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
      A private business development company as defined in  Section 202(a)(22) of the
                  Investment Advisers Act of 1940;</font></td>
</tr>
</table>
<br>

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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>         ___  </font></td>
<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>9. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
      Any   partnership   or   corporation   or   any   organization   described   in
                  Section 501(c)(3)  of the Internal  Revenue Code or similar  business
trust,  not formed                   for the  specific  purpose of  acquiring  the
 Shares,  with  total  assets in excess of                   $5,000,000;</font></td>
</tr>
</table>
<br>

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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>         ___  </font></td>
<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>10. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
     A trust,  with  total  assets in  excess  of  $5,000,000,  not  formed  for the
                  specific   purpose  of  acquiring   the  Shares,   whose   purchase  is
 directed  by  a                   sophisticated person as described in Rule
 506(b)(2)(ii) of the Exchange Act;</font></td>
</tr>
</table>
<br>

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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>___  </font></td>
<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>11. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
An entity in which all of the equity owners qualify under any of the above subparagraphs.
If the undersigned belongs to this investor category only, list the equity owners of the
undersigned, and the investor category which each such equity owner satisfies:  _____________________________________________<Br>(Continue
on a separate piece of paper, if necessary.)</font></td>
</tr>
</table>
<br>


<p align=center>
<font size=2>6</font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Please
set forth in the space provided below the (i)&nbsp;states, if any, in the U.S. in which
you maintained your principal office during the past two years and the dates during which
you maintained your office in each state, (ii)&nbsp;state(s), if any, in which you are
incorporated or otherwise organized and (iii)&nbsp;state(s), if any, in which you pay
income taxes. </font></p>


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<tr Valign=TOP>
<td Width=10%>&nbsp;</td>
<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>
__________________________________________________________________________ </font></td>
</tr>
</table>
<br>

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<tr Valign=TOP>
<td Width=10%>&nbsp;</td>
<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>
__________________________________________________________________________ </font></td>
</tr>
</table>
<br>

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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=10%>&nbsp;</td>
<td Width=90%><Font Face="Times New Roman, Times, Serif" Size=2>
__________________________________________________________________________  </font></td>
</tr>
</table>
<br>

<!-- MARKER FORMAT-SHEET="Head Left-TNR" FSL="Workstation" -->
<P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>Dated:__________________________,
2007 </font></p>


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<P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>__________________________<Br>Print Name of Investor </font></p>


<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>_________________________________________________
<Br>Name:
<Br>Title:
<Br>(Signature and title of authorized officer, partner or trustee)
</FONT></P>

<p align=center>
<font size=2>7</font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>


<!-- MARKER FORMAT-SHEET="Head Major Center Bold-TNR" FSL="Workstation" -->
<H1 Align=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><U>SECURITIES DELIVERY
INSTRUCTIONS</U> </FONT> </h1>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>Please instruct us as to where you
would like the Securities delivered to at Closing: </font></p>

<!-- MARKER FORMAT-SHEET="Head Left-TNR" FSL="Workstation" -->
<P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>Name:
_________________________________________________________ </font></p>

<!-- MARKER FORMAT-SHEET="Head Left-TNR" FSL="Workstation" -->
<P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>Company:
______________________________________________________ </font></p>

<!-- MARKER FORMAT-SHEET="Head Left-TNR"  -->
<P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>Address:
_______________________________________________________<Br><Br>______________________________________________________________ </font></p>

<!-- MARKER FORMAT-SHEET="Head Left-TNR" FSL="Workstation" -->
<P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>Telephone:
______________________________________________________ </font></p>

<!-- MARKER FORMAT-SHEET="Head Left-TNR" FSL="Workstation" -->
<P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>Other Special
Instructions: __________________________________________<Br><Br>______________________________________________________________ </font></p>

<p align=center>
<font size=2>8</font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>







<!-- MARKER FORMAT-SHEET="Head Major Left Bold-TNR" FSL="Workstation" -->
<H1 Align="Center"><Font Face="Times New Roman, Times, Serif" Size=2>Exhibit&nbsp;B </font></h1>

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<H1 Align=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><U>OPINION OF COMPANY
COUNSEL</U> </FONT> </h1>

<!-- MARKER FORMAT-SHEET="Head Major Left Bold-TNR" FSL="Workstation" -->
<H1 Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>[To be attached] </font></h1>

<p align=center>
<font size=2></font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>


<!-- MARKER FORMAT-SHEET="Head Major Center Bold 1-TNR" FSL="Workstation" -->
<H1 Align=CENTER><Font Face="Times New Roman, Times, Serif" Size=2>Exhibit&nbsp;C </font></h1>




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<H1 Align=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><U>PLAN OF DISTRIBUTION</U> </FONT> </h1>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
selling stockholders and any of their respective pledgees, donees, assignees and other
successors in interest may, from time to time, sell any or all of their shares of common
stock on any stock exchange, market or trading facility on which the shares are traded or
in private transactions. These sales may be at fixed or negotiated prices. The selling
stockholders may use any one or more of the following methods when selling shares: </font></p>

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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2><FONT size="2" face="Wingdings 2">&#151;</font>  </font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>ordinary
brokerage transactions and transactions in which the broker-dealer solicits purchasers;</font></td>
</tr>
</table>
<br>

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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2><FONT size="2" face="Wingdings 2">&#151;</font>  </font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>block
trades in which the broker-dealer will attempt to sell the shares as agent but may
position and resell a portion of the block as principal to facilitate the transaction; </font></td>
</tr>
</table>
<br>

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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2><FONT size="2" face="Wingdings 2">&#151;</font>  </font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>purchases
by a broker-dealer as principal and resale by the broker-dealer for its account;</font></td>
</tr>
</table>
<br>

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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2><FONT size="2" face="Wingdings 2">&#151;</font>  </font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>an
exchange distribution in accordance with the rules of the applicable exchange;</font></td>
</tr>
</table>
<br>

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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2><FONT size="2" face="Wingdings 2">&#151;</font>  </font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>privately
negotiated transactions;</font></td>
</tr>
</table>
<br>

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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2><FONT size="2" face="Wingdings 2">&#151;</font>  </font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>short
sales;</font></td>
</tr>
</table>
<br>

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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2><FONT size="2" face="Wingdings 2">&#151;</font>  </font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>broker-dealers
may agree with the selling stockholders to sell a specified number of such shares at
     a stipulated price per share;</font></td>
</tr>
</table>
<br>

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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2><FONT size="2" face="Wingdings 2">&#151;</font>  </font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>through
the writing of options, swaps or other derivatives which may or may not be listed on an
 exchange; </font></td>
</tr>
</table>
<br>

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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2><FONT size="2" face="Wingdings 2">&#151;</font>  </font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>a
combination of any such methods of sale; and</font></td>
</tr>
</table>
<br>

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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2><FONT size="2" face="Wingdings 2">&#151;</font>  </font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>any
other method permitted pursuant to applicable law.</font></td>
</tr>
</table>
<br>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
selling stockholders may also sell shares under Rule 144 under the Securities Act, if
available, rather than under this prospectus. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
selling stockholders may also engage in short sales against the box after this
registration statement becomes effective, puts and calls and other transactions in our
shares or derivatives of our shares and may sell or deliver shares in connection with
these trades. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Broker-dealers
engaged by the selling stockholders may arrange for other brokers-dealers to participate
in sales. Broker-dealers may receive commissions or discounts from the selling
stockholders (or, if any broker-dealer acts as agent for the purchaser of shares, from the
purchaser) in amounts to be negotiated. The selling stockholders do not expect these
commissions and discounts to exceed what is customary in the types of transactions
involved. Any profits on the resale of shares of common stock by a broker-dealer acting as
principal might be deemed to be underwriting discounts or commissions under the Securities
Act. </font></p>

<p align=center>
<font size=2></font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>


<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
selling stockholders may enter into derivative or other hedging transactions with
financial institutions. These financial institutions may in turn engage in sales of the
shares to hedge their position, deliver this prospectus in connection with some or all of
those sales and use the shares covered by this prospectus to close out any short position
created in connection with those sales. The selling stockholders may also sell shares of
the shares short using this prospectus and deliver the shares covered by this prospectus
to close out such short positions, or loan or pledge the shares to financial institutions
that in turn may sell the shares using this prospectus. The selling stockholders may
pledge or grant a security interest in some or all of the shares covered by this
prospectus to support a derivative or hedging position or other obligation and, if the
selling stockholders default in the performance of their obligations, the pledgees or
secured parties may offer and sell the shares from time to time pursuant to this
prospectus. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Discounts,
concessions, commissions and similar selling expenses, if any, attributable to the sale of
shares will be borne by a selling stockholder. The selling stockholders may agree to
indemnify any agent, dealer or broker-dealer that participates in transactions involving
sales of the shares against certain liabilities, including liabilities that may be imposed
on that person under the Securities Act. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
selling stockholders may from time to time pledge or grant a security interest in some or
all of the shares of common stock owned by them and, if they default in the performance of
their secured obligations, the pledgees or secured parties may offer and sell the shares
of common stock from time to time under this prospectus, or, if required, after we have
filed a supplement to this prospectus under Rule 424(b)(3) or other applicable provision
of the Securities Act of 1933 supplementing or amending the list of selling stockholders
to include the pledgee, transferee or other successors in interest as selling stockholders
under this prospectus. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
selling stockholders also may transfer the shares of common stock in other circumstances,
in which case the transferees, pledgees or other successors in interest will be the
selling beneficial owners for purposes of this prospectus and may sell the shares of
common stock from time to time under this prospectus, or, if required, after we have filed
a supplement to this prospectus under Rule 424(b)(3) or other applicable provision of the
Securities Act of 1933 supplementing or amending the list of selling stockholders to
include the pledgee, transferee or other successors in interest as selling stockholders
under this prospectus. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
selling stockholders and any broker-dealers or agents that are involved in selling the
shares of common stock may be deemed to be &#147;underwriters&#148; within the meaning of
the Securities Act in connection with such sales. In such event, any commissions received
by such broker-dealers or agents and any profit on the resale of the shares of common
stock purchased by them may be deemed to be underwriting commissions or discounts under
the Securities Act. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
are required to pay all fees and expenses incident to the registration of the shares of
common stock. We have agreed to indemnify the selling stockholders against certain losses,
claims, damages and liabilities, including liabilities under the Securities Act. </font></p>

<p align=center>
<font size=2></font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
selling stockholders have advised us that they have not entered into any agreements,
understandings or arrangements with any underwriters or broker-dealers regarding the sale
of their shares of common stock, nor is there an underwriter or coordinating broker acting
in connection with a proposed sale of shares of common stock by any selling stockholder.
If we are notified by any selling stockholder that any material arrangement has been
entered into with a broker-dealer for the sale of shares of common stock, if required, we
will file a supplement to this prospectus. If the selling stockholders use this prospectus
for any sale of the shares of common stock, they will be subject to the prospectus
delivery requirements of the Securities Act. </font></p>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Default" -->
<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
have advised the selling stockholders that the anti-manipulation rules of Regulation M
under the Securities Exchange Act of 1934 may apply to sales of our common stock and
activities of the selling stockholders. </font></p>


<p align=center>
<font size=2></font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>


<!-- MARKER FORMAT-SHEET="Head Major Center Bold 1-TNR" FSL="Workstation" -->
<H1 Align=CENTER><Font Face="Times New Roman, Times, Serif" Size=2>Exhibit&nbsp;D </font></h1>

<!-- MARKER FORMAT-SHEET="Head Major Center Bold-TNR" FSL="Workstation" -->
<H1 Align=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><U>COMPANY TRANSFER AGENT
INSTRUCTIONS</U> </FONT> </h1>

<!-- MARKER FORMAT-SHEET="Head Left-TNR" FSL="Workstation" -->
<P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>American Stock Transfer
&amp; Trust Company </font></p>

<!-- MARKER FORMAT-SHEET="Head Left-TNR" FSL="Workstation" -->
<P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>Attention: </font></p>

<!-- MARKER FORMAT-SHEET="Head Left-TNR" FSL="Workstation" -->
<P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>Ladies and Gentlemen: </font></p>

<!-- MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation" -->
<P><Font Face="Times New Roman, Times, Serif" Size=2>Reference is made to that certain
Securities Purchase Agreement, dated as of May XX, 2007 (the
<B>&#147;Agreement&#148;</b>), by and between Silicom Ltd., an Israeli corporation (the
&#147;<B>Company</b>&#148;), and CD Investment Partners, Ltd. (the
&#147;<B>Holder&#148;</b>), pursuant to which the Company is issuing to the Holder
ordinary shares (the &#147;<B>Shares</b>&#148;) of the Company, par value NIS 0.01 per
share (the &#147;<B>Ordinary Shares</b>&#148;), and a Warrant (the
&#147;<B>Warrant</b>&#148;), which is exercisable into Ordinary Shares. </font></p>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Default" -->
<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This
letter shall serve as our irrevocable authorization and direction to you (provided that
you are the transfer agent of the Company at such time): </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)
 to issue Ordinary Shares upon transfer or resale of the Shares; and </font></p>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp;
to issue Ordinary Shares upon the exercise of the Warrant (the &#147;<B>Warrant
Shares</b>&#148;) to or upon the order of the Holder from time to time upon delivery to
you of a properly completed and duly executed Exercise Notice, in the form attached hereto
as <U>Exhibit&nbsp;I</u>, which has been acknowledged by the Company as indicated by the
signature of a duly authorized officer of the Company thereon. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;You
acknowledge and agree that so long as you have previously received (a)&nbsp;written
confirmation from the Company&#146;s legal counsel that either (i)&nbsp;a registration
statement covering resales of the Shares and the Warrant Shares has been declared
effective by the Securities and Exchange Commission (the &#147;<B>SEC</b>&#148;) under the
Securities Act of 1933, as amended (the &#147;<B>1933 Act</b>&#148;) and that resales of
the Shares and the Warrant Shares may be made thereunder, or (ii)&nbsp;sales of the Shares
and the Warrant Shares may be made in conformity with Rule&nbsp;144(k) under the 1933 Act
<B>(&#147;Rule&nbsp;144(k)</b>&#148;) and (b)&nbsp;if applicable, a copy of such
registration statement, then, unless otherwise required by law, within three (3) business
days of your receipt of the request from the Holder and the items referred to in (a) and
(b), as applicable, you shall issue the certificates representing the Shares and the
Warrant Shares, which certificates shall not bear any legend restricting transfer of the
Shares and the Warrant Shares thereby and should not be subject to any stop-transfer
restriction. You acknowledge and agree that so long as you have previously received notice
(accompanied by a legal opinion) from legal counsel to the Company or the Holder that a
transfer of Shares and/or Warrant Shares has been effected pursuant to Rule&nbsp;144 then,
unless otherwise required by law, within three (3) business days of your receipt such
notice (accompanied by a legal opinion) you shall issue the certificates representing the
Shares and the Warrant Shares, which certificates shall not bear any legend restricting
transfer of the Shares and the Warrant Shares thereby and should not be subject to any
stop-transfer restriction. </font></p>

<p align=center>
<font size=2></font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>


<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A
form of written confirmation (to be used in connection with any sale) from the
Company&#146;s outside legal counsel that a registration statement covering resales of the
Shares and the Warrant Shares has been declared effective by the SEC under the 1933 Act is
attached hereto as <U>Exhibit&nbsp;II</u>. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Please
be advised that the Holder is relying upon this letter as an inducement to enter into the
Agreement and, accordingly, the Holder is a third party beneficiary to these instructions. </font></p>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Default" -->
<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Please
execute this letter in the space indicated to acknowledge your agreement to act in
accordance with these instructions. Should you have any questions concerning this matter,
please contact me at +972-9-764-4555. </font></p>


<!-- MARKER FORMAT-SHEET="Signature (Single)" FSL="Workstation" -->
<Table Width=100% Cellspacing=0 Cellpadding=0 Border=0>
<tr Valign=TOP>
<td Width=40%><Font Face="Times New Roman, Times, Serif" Size=2></font></td>
<td Width=10%><Font Face="Times New Roman, Times, Serif" Size=2></font></td>
<td Width=50%><Font Face="Times New Roman, Times, Serif" Size=2>Very truly yours,<Br><Br>SILICOM LTD.<Br>
<br>By: <br>&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;<br>
Name:<br>Title:</font></td>
</tr>
</table>
<br>


<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>THE FOREGOING INSTRUCTIONS ARE
<Br>ACKNOWLEDGED AND AGREED TO
<Br>this      day of ___________, 2007
</FONT></P>

<P><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><B>AMERICAN STOCK TRANSFER &amp; TRUST COMPANY</B> </FONT></P>


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     <TD WIDTH=5% ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=95% ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>By: _________________________</FONT></TD></TR>
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     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Name: ____________________</FONT></TD></TR>
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     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Title: _____________________</FONT></TD></TR>
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<Br>


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<P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>Enclosures </font></p>

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<H1 Align=CENTER><Font Face="Times New Roman, Times, Serif" Size=2>Exhibit&nbsp;E </font></h1>

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<H1 Align=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><U>FORM OF WARRANT</U> </FONT> </h1>

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<DOCUMENT>
<TYPE>EX-99
<SEQUENCE>4
<FILENAME>exhibit_99-3.htm
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     <!-- Project:        \\Backup\office\EDGAR Filing\Silicom Ltd\73702\a73702.eep        -->
     <!-- Control Number: 73702                                                            -->
     <!-- Rev Number:     1                                                                -->
     <!-- Client Name:    Silicom Ltd                                                      -->
     <!-- Project Name:   6-K                                                              -->
     <!-- Firm Name:      Zadok-Keinan Ltd                                                 -->
     <TITLE>6-K</TITLE>
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<P Align="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><U><B>Exhibit 99.3</B></U> </FONT> </P>

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<P Align=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><U><B>EXHIBIT F</B></U> </FONT> </p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2><B>NEITHER THIS SECURITY NOR THE
SECURITIES FOR WHICH THIS SECURITY IS EXERCISABLE HAVE BEEN REGISTERED WITH THE SECURITIES
AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN
EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
&#147;SECURITIES ACT&#148;), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT
TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN
AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS
AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR TO SUCH EFFECT, THE SUBSTANCE
OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY. THIS SECURITY AND THE SECURITIES
ISSUABLE UPON EXERCISE OF THIS SECURITY MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE
MARGIN ACCOUNT OR OTHER LOAN SECURED BY SUCH SECURITIES.</b> </font></p>

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<P Align=CENTER><Font Face="Times New Roman, Times, Serif" Size=2>SILICOM LTD. </font></p>

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<P Align=CENTER><Font Face="Times New Roman, Times, Serif" Size=2><U>WARRANT</u></font></p>


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     <TD WIDTH=50% ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Warrant No. [&nbsp;&nbsp;]</FONT></TD>
     <Td Width="50%" Align="Right"><FONT FACE="Times New Roman" SIZE=2>Dated: May __, 2007</FONT></TD></TR>
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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;SILICOM
LTD., an Israeli corporation (the &#147;<B>Company</b>&#148;), hereby certifies that, for
value received, [Name of Holder] or its registered assigns (the
&#147;<B>Holder</b>&#148;), is entitled to purchase from the Company up to a total of
[&nbsp;&nbsp;]<Sup>1</sup> ordinary shares, NIS 0.01 par value per share (the
&#147;<B>Ordinary Shares</b>&#148;), of the Company (each such share, a &#147;<B>Warrant
Share</b>&#148; and all such shares, the &#147;<B>Warrant Shares</b>&#148;) at an exercise
price equal to $28.25 per share (as adjusted from time to time as provided in
<U>Section&nbsp;9</u>, the &#147;<B>Exercise Price</b>&#148;), at any time on or after the
date hereof (the &#147;<B>Initial Exercise Date</b>&#148;) and through and including the
date that is three (3) years from the Effective Date (the &#147;<B>Expiration
Date</b>&#148;), and subject to the following terms and conditions. This Warrant (this
<B>&#147;Warrant</b>&#148;) is one of a series of similar warrants issued pursuant to that
certain Securities Purchase Agreement, dated as of May&nbsp;3, 2007, by and among the
Company and the Investors identified therein (the &#147;<B>Purchase Agreement</b>&#148;).
All such warrants are referred to herein, collectively, as the
&#147;<B>Warrants</b>.&#148; </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;1. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Definitions</u>.
In addition to the terms defined elsewhere in this Warrant,           capitalized terms
that are not otherwise defined herein have the meanings given           to such terms in
the Purchase Agreement.  </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;2. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Warrant
Register</u>. The Company shall register this Warrant, upon records           to be
maintained by the Company for that purpose (the &#147;<B>Warrant           Register</b>&#148;),
in the name of the Holder of record hereof from time to           time. The Company may
deem and treat the registered Holder of this Warrant as           the absolute owner
hereof for the purpose of any exercise hereof or any           distribution to the
Holder, and for all other purposes, absent actual notice to           the contrary.  </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2><Sup>1</sup> 25% warrant coverage. </font></p>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;3. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Registration
of Transfers</u>. The Company shall register the transfer of any           portion of
this Warrant in the Warrant Register, upon surrender of this Warrant,           with the
Form of Assignment attached hereto duly completed and signed, and with           such
other documentation the Company may reasonably request, to the Company at           its
address specified herein. Upon any such registration of transfer, a new           warrant
to purchase Ordinary Shares in substantially the form of this Warrant           (any such
new warrant, a &#147;<B>New Warrant</b>&#148;), evidencing the portion           of this
Warrant so transferred shall be issued to the transferee and a New           Warrant
evidencing the remaining portion of this Warrant not so transferred, if           any,
shall be issued to the transferring Holder. The acceptance of the New           Warrant
by the transferee thereof shall be deemed the acceptance by such           transferee of
all of the rights and obligations of a holder of a Warrant.  </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;4. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Exercise
and Duration of Warrants</u>.  </font></p>

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<td Width=95%><P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;(a) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This
Warrant shall be exercisable by the registered Holder at any time and from           time
to time on or after the Initial Exercise Date to and including the           Expiration
Date. At 5:00&nbsp;P.M., New York City time on the Expiration Date,           the portion
of this Warrant not exercised prior thereto shall be and become void           and of no
value.  </font></p></td>
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<td Width=95%><P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;(b) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A
Holder may exercise this Warrant by delivering to the Company (i)&nbsp;an
          exercise notice, in the form attached hereto (the &#147;<B>Exercise
          Notice</b>&#148;), appropriately completed and duly signed, and           (ii)&nbsp;payment
of the Exercise Price for the number of Warrant Shares as to           which this Warrant
is being exercised (which may take the form of a           &#147;cashless exercise&#148; if
so indicated in the Exercise Notice and only if           a &#147;cashless exercise&#148; may
occur at such time pursuant to           Section&nbsp;10 below), and the date such items
are delivered to the Company (as           determined in accordance with the provisions
hereof) is an &#147;<B>Exercise           Date</b>.&#148; The Holder shall not be
required to deliver the original Warrant           in order to effect an exercise
hereunder. Execution and delivery of the Exercise           Notice shall have the same
effect as cancellation of the original Warrant and           issuance of a New Warrant
evidencing the right to purchase the remaining number           of Warrant Shares. At the
Company&#146;s discretion, the Company, may, by           written notice, require the
Holder to furnish the Exercise Notice and/or other           related documentation,
directly to the Transfer Agent (with a copy to the           Company).  </font></p></td>
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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;5. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Delivery
of Warrant Shares</u>.  </font></p>

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<td Width=95%><P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;(a) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Upon
exercise of this Warrant and receipt of the Exercise Price by the Company           in
accordance with Section&nbsp;4 and Section&nbsp;10, the Company shall           promptly
(but in no event later than five (5) Trading Days after the Exercise           Date)
issue or cause to be issued and cause to be delivered to or upon the           written
order of the Holder and in such name or names as the Holder may           designate, a
certificate for the Warrant Shares issuable upon such exercise,           free of
restrictive legends (if permitted under Section 4.1 of the Purchase           Agreement).
The Holder, or any Person so designated by the Holder to receive           Warrant
Shares, shall be deemed to have become the holder of record of such           Warrant
Shares as of the Exercise Date. The Company shall, upon request of the           Holder,
use its best efforts to deliver Warrant Shares hereunder electronically           through
the facilities of The Depository Trust Company or another established           clearing
corporation performing similar functions acceptable to the Transfer           Agent.  </font></p></td>
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<td Width=95%><P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;(b) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This
Warrant is exercisable, either in its entirety or, from time to time, for a
          portion of the number of Warrant Shares. Upon surrender of this Warrant
          following one or more partial exercises, the Company shall issue or cause to be
          issued, at its expense, a New Warrant evidencing the right to purchase the
          remaining number of Warrant Shares.  </font></p></td>
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<td Width=95%><P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;(c) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
addition to any other rights available to a Holder, if the Company fails to
          deliver to the Holder a certificate representing Warrant Shares by the third
          (3<Sup>rd</sup>) Trading Day after the date on which delivery of such
          certificate is required by this Warrant (the &#147;<B>Exercise Date</b>&#148;),
          and if after such third (3<Sup>rd</sup>) Trading Day the Holder purchases (in
an           open market transaction or otherwise) Ordinary Shares to deliver in
satisfaction           of a sale by the Holder of the Warrant Shares that the Holder
anticipated           receiving from the Company (a &#147;<B>Buy-In</b>&#148;), then the
Company           shall, within three (3)&nbsp;Trading Days after the Holder&#146;s
request and in           the Company&#146;s discretion, either (i)&nbsp;pay cash to the
Holder in an           amount equal to the Holder&#146;s total purchase price (including
brokerage           commissions, if any) for the Ordinary Shares so purchased (the &#147;<B>Buy-In
          Price</b>&#148;), at which point the Company&#146;s obligation to deliver such
          certificate (and to issue such Ordinary Shares) shall terminate, or
          (ii)&nbsp;promptly honor its obligation to deliver to the Holder a certificate
          or certificates representing such Ordinary Shares the Company failed to deliver
          and pay cash to the Holder in an amount equal to the excess (if any) of the
          Buy-In Price over the product of (A) such number of Ordinary Shares, times (B)
          the Closing Price on the Exercise Date.  </font></p></td>
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<td Width=95%><P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;(d) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company&#146;s obligations to issue and deliver Warrant Shares in accordance
          with the terms hereof are absolute and unconditional, irrespective of any
action           or inaction by the Holder to enforce the same, any waiver or consent
with           respect to any provision hereof, the recovery of any judgment against any
Person           or any action to enforce the same, or any setoff, counterclaim,
recoupment,           limitation or termination, or any breach or alleged breach by the
Holder or any           other Person of any obligation to the Company or any violation or
alleged           violation of law by the Holder or any other Person, and irrespective of
any           other circumstance which might otherwise limit such obligation of the
Company to           the Holder in connection with the issuance of Warrant Shares.
Nothing herein           shall limit a Holder&#146;s right to pursue any other remedies
available to it           hereunder, at law or in equity including, without limitation, a
decree of           specific performance and/or injunctive relief with respect to the
Company&#146;s           failure to timely deliver certificates representing Ordinary
Shares upon           exercise of this Warrant as required pursuant to the terms hereof.  </font></p></td>
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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;6. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Charges,
Taxes and Expenses</u>. Issuance and delivery of certificates for           Ordinary
Shares upon exercise of this Warrant shall be made without charge to           the Holder
for any issue or transfer tax, withholding tax, transfer agent fee or           other
incidental tax or expense in respect of the issuance of such certificates,           all
of which taxes and expenses shall be paid by the Company; <U>provided</u>, <U>however</u>,
that the Company shall not be required to pay any tax which may           be payable in
respect of any transfer involved in the registration of any           certificates for
Warrant Shares or Warrants in a name other than that of the           Holder. The Holder
shall be responsible for all other tax liability that may           arise as a result of
holding or transferring this Warrant or receiving Warrant           Shares upon exercise
hereof. Except as expressly set forth herein, in no event           shall the Company be
responsible for any broker or similar commissions and such           shall be borne by
the Holder.  </font></p>

<p align=center>
<font size=2>3</font></p>
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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;7. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Replacement
of Warrant</u>. If this Warrant is mutilated, lost, stolen or           destroyed, the
Company shall issue or cause to be issued in exchange and           substitution for and
upon cancellation hereof, or in lieu of and substitution           for this Warrant, a
New Warrant, but only upon receipt of evidence reasonably           satisfactory to the
Company of such loss, theft or destruction and customary and           reasonable bond or
indemnity, if requested. Applicants for a New Warrant under           such circumstances
shall also comply with such other reasonable regulations and           procedures and pay
such other reasonable third-party costs as the Company may           prescribe.  </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;8. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Reservation
of Warrant Shares</u>. The Company covenants that it will at all           times reserve
and keep available out of the aggregate of its authorized but           unissued and
otherwise unreserved Ordinary Shares, solely for the purpose of           enabling it to
issue Warrant Shares upon exercise of this Warrant as herein           provided, the
number of Warrant Shares which are then issuable and deliverable           upon the
exercise of this entire Warrant, free from preemptive rights or any           other
contingent purchase rights of persons other than the Holder (after giving
          effect to the adjustments and restrictions of Section&nbsp;9, if any). The
          Company covenants that all Warrant Shares so issuable and deliverable shall,
          upon issuance and the payment of the applicable Exercise Price in accordance
          with the terms hereof, be duly and validly authorized, issued and fully paid
and           nonassessable. The Company will take all such action as may be necessary to
          assure that such Ordinary Shares may be issued as provided herein without
          violation of any applicable law or regulation, or of any requirements of any
          securities exchange or automated quotation system upon which the Ordinary
Shares           may be listed.  </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;9. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Certain
Adjustments</u>. The Exercise Price and number of Warrant Shares           issuable upon
exercise of this Warrant are subject to adjustment from time to           time as set
forth in this Section&nbsp;9.  </font></p>

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<td Width=95%><P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;(a) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Stock
Dividends and Splits</u>. If the Company, at any time while this           Warrant is
outstanding, (i)&nbsp;pays a stock dividend on its Ordinary Shares or           otherwise
makes a distribution on any class of capital stock that is payable in           Ordinary
Shares, (ii)&nbsp;subdivides outstanding Ordinary Shares into a larger           number
of shares, or (iii)&nbsp;combines outstanding Ordinary Shares into a           smaller
number of shares, then in each such case the Exercise Price shall be           multiplied
by a fraction of which the numerator shall be the number of Ordinary           Shares
outstanding immediately before such event (excluding treasury shares, if           any)
and of which the denominator shall be the number of Ordinary Shares           outstanding
immediately after such event (excluding treasury shares, if any).           Any
adjustment made pursuant to clause (i)&nbsp;of this paragraph shall become
          effective immediately after the record date for the determination of
          stockholders entitled to receive such dividend or distribution (<U>provided</u>,
<U>however</u>, that if such record date is fixed and such dividend is not fully
          paid or if such distribution is not fully made on the date fixed therefor, the
          Exercise Price shall be recomputed accordingly as of the close of business on
          such record date and thereafter the Exercise Price shall be adjusted pursuant
to           this Section as of the time of the actual payment of such dividends or
          distribution), and any adjustment pursuant to clause&nbsp;(ii) or (iii) of this
          paragraph shall become effective immediately after the effective date of such
          subdivision or combination.  </font></p></td>
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<p align=center>
<font size=2>4</font></p>
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<td Width=95%><P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;(b) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Pro
Rata Distributions</u>. If the Company, at any time while this Warrant is
          outstanding, distributes to holders of Ordinary Shares (i)&nbsp;any equity
          security (other than a distribution of Ordinary Shares covered by the preceding
          paragraph), (ii)&nbsp;rights or warrants to subscribe for or purchase any
equity           security, or (iii)&nbsp;any other asset other than cash dividends out of
          earnings (in each case, &#147;<B>Distributed Property</b>&#148;), then in each
          such case the Holder shall be entitled upon exercise of this Warrant for the
          purchase of any or all of the Warrant Shares, to receive the amount of
          Distributed Property which would have been payable to the Holder had such
Holder           been the holder of such Warrant Shares on the record date for the
determination           of shareholders entitled to such Distributed Property. The
Company will at all           times set aside and keep available for distribution to such
holder upon exercise           of this Warrant a portion of the Distributed Property to
satisfy the           distribution to which such Holder is entitled pursuant to the
preceding           sentence.  </font></p></td>
</tr>
</table>
<br>

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<td Align=RIGHT Width=5%></td>
<td Width=95%><P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;(c) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Fundamental
Transactions</u>. If any capital reorganization, reclassification           of the
capital stock of the Company, consolidation or merger of the Company with
          another company in which the Company is not the survivor, or sale, transfer or
          other disposition of all or substantially all of the Company&#146;s assets to
          another corporation shall be effected (all such transactions being hereinafter
          referred to as a &#147;<B>Fundamental Transaction</b>&#148;), then the Company
          shall use its best efforts to ensure that lawful and adequate provision shall
be           made whereby the Holder shall thereafter have the right to purchase and
receive           upon the basis and upon the terms and conditions herein specified and
in lieu of           the Warrant Shares immediately theretofore issuable upon exercise of
this           Warrant, such shares of stock, securities or assets as would have been
issuable           or payable with respect to or in exchange for a number of Warrant
Shares equal           to the number of Warrant Shares immediately theretofore issuable
upon exercise           of this Warrant, had such reorganization, reclassification,
consolidation,           merger, sale, transfer or other disposition not taken place, and
in any such           case appropriate provision shall be made with respect to the rights
and           interests of the Holder to the end that the provisions hereof (including,
          without limitation, provision for adjustment of the Exercise Price) shall
          thereafter be applicable, as nearly equivalent as may be practicable in
relation           to any share of stock, securities or assets thereafter deliverable
upon the           exercise thereof. The Company shall not effect any such consolidation,
merger,           sale, transfer or other disposition unless prior to or simultaneously
with the           consummation thereof the successor company (if other than the Company)
resulting           from such consolidation or merger, or the company purchasing or
otherwise           acquiring such assets or other appropriate corporation or entity
shall assume           the obligation to deliver to the Holder, at the last address of
the Holder           appearing on the books of the Company, such shares of stock,
securities or           assets as, in accordance with the foregoing provisions, the
Holder may be           entitled to purchase, and the other obligations under this
Warrant. The           provisions of this Section&nbsp;9(c) shall similarly apply to
successive           reorganizations, reclassifications, consolidations, mergers, sales,
transfers or           other dispositions, each of which transactions shall also
constitute a           Fundamental Transaction. Notwithstanding the foregoing, if any
Fundamental           Transaction constitutes or results in (a)&nbsp;a &#147;going private&#148;          transaction
as defined in Rule&nbsp;13e-3 under the Exchange Act, (b)&nbsp;an           acquisition
of the Company primarily for cash, or (c)&nbsp;an acquisition,           merger or sale
with or into a Person not traded on an Eligible Market, then the           Company (or
any such successor or surviving entity) shall require that Holder           waive the
above requirements of this Section 9(c) in exchange for a payment of           cash on
the closing date of such Fundamental Transaction, equal to the Black           Scholes
Value of the remaining unexercised portion of this Warrant on the           closing date
of such Fundamental Transaction, provided that the per share           consideration to
be received by the holders of Ordinary Shares upon the           consummation of such
Fundamental Transaction is less than the Exercise Price.           Concurrently with such
payment, this Warrant shall be cancelled. &#147;<B>Black           Scholes Value</b>&#148; means
the value of this Warrant based on the Black and           Scholes Option Pricing Model
obtained from the &#147;OV&#148; function on           Bloomberg determined as of the day
immediately following the public announcement           of the applicable Fundamental
Transaction and reflecting (i)&nbsp;a risk-free           interest rate corresponding to
the U.S. Treasury rate for a period equal to the           remaining term of this Warrant
as of such date and (ii)&nbsp;an expected           volatility equal to the lesser of (x)
60 &#150; or (y) 100 &#150; day volatility           obtained from the HVT function on
Bloomberg.  </font></p></td>
</tr>
</table>
<br>

<p align=center>
<font size=2>5</font></p>
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<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
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<Table Width=100% Cellpadding=0 Cellspacing=0>
<tr Valign=TOP>
<td Align=RIGHT Width=5%></td>
<td Width=95%><P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;(d) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Subsequent
Equity Sales</u>.  </font></p></td>
</tr>
</table>
<br>

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<Table Width=100% Cellpadding=0 Cellspacing=0>
<tr Valign=TOP>
<td Align=RIGHT Width=10%></td>
<td Width=90%><P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;(i) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If,
at any time from the date hereof until twelve (12) months from the Closing
          Date, the Company issues additional Ordinary Shares or rights, warrants,
options           or other securities or debt convertible, exercisable or exchangeable
for           Ordinary Shares or otherwise entitling any Person to acquire Ordinary
Shares           (collectively, <B>&#147;Ordinary Share Equivalents&#148;</b>) at an
effective           price to the Company per share of Ordinary Shares (the <B>&#147;Effective
          Price&#148;</b>) less than the Exercise Price (as adjusted hereunder to such
          date but excluding the operation of this paragraph (d) as a result of such
          issuance), then the total maximum number of Ordinary Shares issuable upon
          conversion, exercise or exchange of all then outstanding Ordinary Share
          Equivalents shall be deemed to be outstanding as of the date of issuance of
such           Ordinary Share Equivalents and the Exercise Price shall be reduced to
equal the           product of (A) the Exercise Price in effect immediately prior to such
new           issuance of Ordinary Shares or Ordinary Share Equivalents times (B) a
fraction,           the numerator of which is the sum of (1) the number of Ordinary
Shares           outstanding or deemed to be outstanding immediately prior to such
issuance, plus           (2) the number of Ordinary Shares which the aggregate Effective
Price of the           Ordinary Shares issued (or deemed to be issued) would purchase at
the Exercise           Price (as adjusted hereunder to such date but excluding the
operation of this           paragraph (d) as a result of such issuance), and the
denominator of which is the           aggregate number of Ordinary Shares outstanding or
deemed to be outstanding           immediately after such issuance. Notwithstanding the
foregoing, in no event           shall the Exercise Price be reduced below $23.13 per
share (as appropriately           adjusted for any event described in paragraph (a) of
this Section) through the           operation of this paragraph (d). For purposes of this
paragraph, (A) the maximum           number of Ordinary Shares potentially issuable at
any time upon conversion,           exercise or exchange of the relevant Ordinary Share
Equivalents (the <B>&#147;Deemed Number&#148;</b>) shall be deemed to be outstanding upon
          issuance of such Ordinary Share Equivalents (without regard to any provision
          contained therein for a subsequent adjustment to such number of shares), (B)
the           Effective Price applicable to a new issuance of Ordinary Shares shall equal
the           minimum dollar value of consideration payable to the Company to purchase
such           Ordinary Shares and the Effective Price applicable to a new issuance of
Ordinary           Share Equivalents shall equal the minimum dollar value of
consideration payable           to the Company to purchase such Ordinary Share
Equivalents and to convert,           exercise or exchange such Ordinary Share
Equivalents into Ordinary Shares           (without regard to any provision contained
therein for a subsequent adjustment           to such number of shares), divided by the
Deemed Number, and (C) no further           adjustment shall be made to the Exercise
Price upon the actual issuance of           Ordinary Shares upon conversion, exercise or
exchange of such Ordinary Share           Equivalents. If such Ordinary Share Equivalents
by their terms provide, with the           passage of time or otherwise, for any decrease
in the consideration payable to           the Company, or increase in the number of
Ordinary Shares issuable upon the           exercise, conversion or exchange thereof,
other than pursuant to customary           &#147;weighted average&#148; anti-dilution
provisions, the Exercise Price           computed upon the original issue thereof, and
any subsequent adjustments based           thereon, shall, upon any such decrease or
increase becoming effective, be           recomputed to reflect such decrease or increase
insofar as it affects such           Ordinary Share Equivalents. On the expiration of any
Ordinary Share Equivalent,           or the termination of any such right to convert or
exchange any such Ordinary           Share Equivalent into or for Ordinary Shares, the
Exercise Price then in effect           hereunder shall forthwith be readjusted
(increased or decreased, as the case may           be) to the Exercise Price which would
have been in effect at the time of such           expiration or termination had such
Ordinary Share Equivalent, to the extent           outstanding immediately prior to such
expiration or termination, never been           granted, issued or sold, and the Ordinary
Shares issuable thereunder shall no           longer be deemed to be outstanding.  </font></p></td>
</tr>
</table>
<br>

<p align=center>
<font size=2>6</font></p>
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<Table Width=100% Cellpadding=0 Cellspacing=0>
<tr Valign=TOP>
<td Align=RIGHT Width=10%></td>
<td Width=90%><P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;(ii) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Notwithstanding
the foregoing, no adjustment will be made under this paragraph           (d) in respect
of any Excluded Stock. For purposes hereof, <B>&#147;Excluded           Stock&#148;</b> shall
mean Ordinary Shares or Ordinary Share Equivalents issued           or deemed issued (v)&nbsp;upon
the exercise of stock options outstanding on the           date hereof, (w) upon the
issuance of Ordinary Shares or stock options to           employees, officers, directors,
service providers or consultants of the Company           or a Subsidiary pursuant to any
stock or option plan of the Company or other           arrangement, including subsequent
to the date hereof (including the issuance of           Ordinary Shares upon exercise of
stock options), (x) to banks, equipment lessors           or other financial
institutions, or to real property lessors, pursuant to a debt           financing,
equipment leasing or real property leasing transaction, (y) pursuant           to the
acquisition of another company or legal entity by the Company by merger,
          purchase of substantially all of the assets or other reorganization or pursuant
          to a joint venture agreement, (z) in connection with marketing or similar
          agreements or strategic partnerships (including, without limitation, by way of
a           private placement to strategic investors and/or entities (whatever the legal
          form) in which, or of which, one or more members of the Company&#146;s
          management or board of directors beneficially owns or controls an equity stake
          of 10% or greater), (aa)&nbsp;in a registered public offering, (bb) upon the
          exercise or exchange of or conversion of (1) any Securities issued under the
          Purchase Agreement or hereunder or (2) securities to a registered broker-dealer
          in connection with the transactions contemplated by the Purchase Agreement, and
          (cc) Ordinary Shares or other securities issued in connection with any stock
          split, stock dividend or recapitalization of the Company (without derogating
          from Section 9(a) hereof).  </font></p></td>
</tr>
</table>
<br>

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<Table Width=100% Cellpadding=0 Cellspacing=0>
<tr Valign=TOP>
<td Align=RIGHT Width=10%></td>
<td Width=90%><P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;(iii) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Notwithstanding
anything to the contrary, no adjustment in the Exercise Price           need be made if
such adjustment would result in (i) a change in the Exercise           Price of less than
$0.01 or (ii) the Exercise Price being reduced to less than           the par value of
the Ordinary Shares.  </font></p></td>
</tr>
</table>
<br>

<!-- MARKER FORMAT-SHEET="Para (List) Indent Lv 1- TNR" FSL="Workstation" -->
<Table Width=100% Cellpadding=0 Cellspacing=0>
<tr Valign=TOP>
<td Align=RIGHT Width=5%></td>
<td Width=95%><P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;(e) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Number
of Warrant Shares</u>. Simultaneously with any adjustment to the           Exercise Price
pursuant to paragraph&nbsp;(a) of this Section, the number of           Warrant Shares
that may be purchased upon exercise of this Warrant shall be           increased or
decreased (as the case may be), proportionately, so that after such           adjustment
the aggregate Exercise Price payable hereunder for the decreased or           increased
(as the case may be) number of Warrant Shares shall be the same as the
          aggregate Exercise Price in effect immediately prior to such adjustment.  </font></p></td>
</tr>
</table>
<br>

<p align=center>
<font size=2>7</font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
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<Table Width=100% Cellpadding=0 Cellspacing=0>
<tr Valign=TOP>
<td Align=RIGHT Width=5%></td>
<td Width=95%><P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;(f) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Calculations</u>.
All calculations under this Section&nbsp;9 shall be made to           the nearest cent or
the nearest 1/100th of a share, as applicable. The number of           Ordinary Shares
outstanding at any given time shall not include shares owned or           held by or for
the account of the Company, and the disposition of any such           shares shall be
considered an issue or sale of Ordinary Shares.  </font></p></td>
</tr>
</table>
<br>

<!-- MARKER FORMAT-SHEET="Para (List) Indent Lv 1- TNR" FSL="Workstation" -->
<Table Width=100% Cellpadding=0 Cellspacing=0>
<tr Valign=TOP>
<td Align=RIGHT Width=5%></td>
<td Width=95%><P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;(g) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Notice
of Adjustments</u>. Upon the occurrence of each adjustment pursuant to           this
Section&nbsp;9, the Company at its expense will promptly compute such
          adjustment in accordance with the terms of this Warrant and prepare a
          certificate setting forth such adjustment, including a statement of the
adjusted           Exercise Price and adjusted number or type of Warrant Shares or other
securities           issuable upon exercise of this Warrant (as applicable), describing
the           transactions giving rise to such adjustments and showing in detail the
facts           upon which such adjustment is based. Upon written request, the Company
will           promptly deliver a copy of each such certificate to the Holder and to the
          Transfer Agent.  </font></p></td>
</tr>
</table>
<br>

<!-- MARKER FORMAT-SHEET="Para (List) Indent Lv 1- TNR" FSL="Workstation" -->
<Table Width=100% Cellpadding=0 Cellspacing=0>
<tr Valign=TOP>
<td Align=RIGHT Width=5%></td>
<td Width=95%><P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;(h) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Notice
of Corporate Events</u>. If the Company (i)&nbsp;declares a dividend           or any
other distribution of cash, securities or other property in respect of           its
Ordinary Shares, including without limitation any granting of rights or
          warrants to subscribe for or purchase any capital stock of the Company,
          (ii)&nbsp;authorizes or approves, enters into any agreement contemplating, or
          solicits stockholder approval for, any Fundamental Transaction or
          (iii)&nbsp;authorizes the voluntary dissolution, liquidation or winding up of
          the affairs of the Company, then the Company shall deliver to the Holder a
          notice describing the material terms and conditions of such transaction, at
          least ten (10) calendar days prior to the applicable record or effective date
on           which a Person would need to hold Ordinary Shares in order to participate in
or           vote with respect to such transaction, and the Company will take all steps
          reasonably necessary in order to insure that the Holder is given the practical
          opportunity to exercise this Warrant prior to such time so as to participate in
          or vote with respect to such transaction; <U>provided</u>, <U>however</u>, that
          the failure to deliver such notice or any defect therein shall not affect the
          validity of the corporate action required to be described in such notice.  </font></p></td>
</tr>
</table>
<br>

<!-- MARKER FORMAT-SHEET="Para (List) Indent Lv 0- TNR" FSL="Workstation" -->
<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;10. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Payment
of Exercise Price</u>. The Holder shall pay the Exercise Price in           immediately
available funds in U.S. dollars; <U>provided</u>, <U>however</u>,           that if at
any time after the Required Effective Date a Registration Statement           covering
the resale of the Warrant Shares is not effective on the Exercise Date,           the
Holder may satisfy its obligation to pay the Exercise Price through a           &#147;cashless
exercise,&#148; in which event the Company shall issue to the           Holder the number
of Warrant Shares determined as follows:  </font></p>

<TABLE CELLPADDING=3 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <Th> </th>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH></TR>
<TR VALIGN=Bottom>
     <Th> </th>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH></TR>
<TR VALIGN=Bottom>
     <Th> </th>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH></TR>
<TR VALIGN=Bottom>
     <Th> </th>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH></TR>
<TR VALIGN=Bottom>
     <Th> </th>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH></TR>
<TR VALIGN=Bottom>
     <Td WIDTH=10%> </td>
     <TD WIDTH=5% ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=85% ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>X = (Y) (A-B)/A</FONT></TD></TR>
<TR VALIGN=Bottom>
     <Td> </td>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>where:</FONT></TD></TR>
<TR VALIGN=Bottom>
     <Td> </td>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>X = the number of Warrant Shares to be issued to the Holder.</FONT></TD></TR>
<TR VALIGN=Bottom>
     <Td> </td>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <Td> </td>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Y = the number of Warrant Shares with respect to which this Warrant is being exercised.</FONT></TD></TR>
<TR VALIGN=Bottom>
     <Td> </td>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <Td> </td>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>A = the average of the Closing Prices for the five Trading Days immediately prior to (but not including) the Exercise Date.</FONT></TD></TR>
<TR VALIGN=Bottom>
     <Td> </td>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <Td> </td>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>B = the Exercise Price.</FONT></TD></TR>
</TABLE>
<Br>

<p align=center>
<font size=2>8</font></p>
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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For
purposes of Rule 144 promulgated under the Securities 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 Purchase Agreement. </font></p>

<!-- MARKER FORMAT-SHEET="Para (List) Indent Lv 0- TNR" FSL="Workstation" -->
<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;11. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Limitation
on Exercise</u>. Notwithstanding anything to the contrary           contained herein, the
number of Ordinary Shares that may be acquired by the           Holder upon any exercise
of this Warrant (or otherwise in respect hereof) shall           be limited to the extent
necessary to insure that, following such exercise (or           other issuance), the
total number of Ordinary Shares then beneficially owned by           such Holder and its
Affiliates and any other Persons whose beneficial ownership           of Ordinary Shares
would be aggregated with the Holder&#146;s for purposes of           Section&nbsp;13(d)
of the Exchange Act, does not exceed 4.99% (the           &#147;<B>Maximum Percentage</b>&#148;)
of the total number of issued and           outstanding Ordinary Shares (including for
such purpose the Ordinary Shares           issuable upon such exercise). For such
purposes, beneficial ownership shall be           determined in accordance with Section&nbsp;13(d)
of the Exchange Act and the           rules and regulations promulgated thereunder. Each
delivery of an Exercise           Notice hereunder will constitute a representation by
the Holder that it has           evaluated the limitation set forth in this paragraph and
determined that           issuance of the full number of Warrant Shares requested in such
Exercise Notice           is permitted under this paragraph, and the Company shall have
no obligation to           verify or confirm the accuracy of such determination and shall
have no liability           with respect to this Section&nbsp;11. By written notice to
the Company, the           Holder may waive the provisions of this Section or increase or
decrease the           Maximum Percentage to any other percentage specified in such
notice, but           (i)&nbsp;any such waiver or increase will not be effective until
the 61st day           after such notice is delivered to the Company, and (ii)&nbsp;any
such waiver or           increase or decrease will apply only to the Holder and not to
any other holder           of Warrants.  </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;12. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Fractional
Shares</u>. The Company shall not be required to issue or cause to           be issued
fractional Warrant Shares or scrip representing fractional shares on           the
exercise of this Warrant. If any fraction of a Warrant Share would, except           for
the provisions of this Section, be issuable upon exercise of this Warrant,           the
number of Warrant Shares to be issued will be rounded down to the nearest           whole
share.  </font></p>

<!-- MARKER FORMAT-SHEET="Para (List) Indent Lv 0- TNR" FSL="Workstation" -->
<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;13. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Notices</u>.
Any and all notices or other communications or deliveries           hereunder (including
without limitation any Exercise Notice) shall be in writing           and shall be deemed
given and effective on the earliest of (i)&nbsp;the date of           transmission, if
such notice or communication is delivered via facsimile at the           facsimile number
specified in the Purchase Agreement prior to 5:00&nbsp;p.m.           (New York City
time) on a Business Day, (ii)&nbsp;the next Business Day after           the date of
transmission, if such notice or communication is delivered via           facsimile at the
facsimile number specified in the Purchase Agreement on a day           that is not a
Business Day or later than 5:00 p.m. (New York City time) on any           Business Day,
(iii)&nbsp;the second Business Day following the date of delivery           to the
courier service, if sent by a U.S. or Israeli nationally recognized           overnight
courier service, or (iv)&nbsp;upon actual receipt by the party to whom           such
notice is required to be given. The address for such notices or           communications
shall be as set forth in the Purchase Agreement.  </font></p>

<p align=center>
<font size=2>9</font></p>
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<!-- MARKER FORMAT-SHEET="Para (List) Indent Lv 0- TNR" FSL="Workstation" -->
<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;14. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Warrant
Agent</u>. The Company shall serve as warrant agent under this           Warrant. Upon
thirty (30) days&#146; notice to the Holder, the Company may           appoint a new
warrant agent. Any corporation into which the Company or any new           warrant agent
may be merged or any corporation resulting from any consolidation           to which the
Company or any new warrant agent shall be a party or any           corporation to which
the Company or any new warrant agent transfers           substantially all of its
corporate trust or stockholder services business shall           be a successor warrant
agent under this Warrant without any further act. Any           such successor warrant
agent shall promptly cause notice of its succession as           warrant agent to be
mailed (by first class mail, postage prepaid) to the Holder           at the Holder&#146;s
last address as shown on the Warrant Register.  </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;15. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Restrictions</u>.
The Holder acknowledges that the Warrant Shares acquired           upon the exercise of
this Warrant, if not registered, will have restrictions           upon resale imposed by
state and U.S. federal and Israeli securities laws.  </font></p>

<!-- MARKER FORMAT-SHEET="Para (List) Indent Lv 0- TNR" FSL="Workstation" -->
<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;16. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Miscellaneous</u>.  </font></p>

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<Table Width=100% Cellpadding=0 Cellspacing=0>
<tr Valign=TOP>
<td Align=RIGHT Width=5%></td>
<td Width=95%><P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;(a) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Subject
to the restrictions on transfer set forth on the first page hereof and
          applicable securities laws, this Warrant and the rights and obligations
          evidenced hereby shall inure to the benefit of and be binding upon the
          successors of the Company and the successors and permitted assigns of the
Holder           as set forth in the Purchase Agreement, provided that this Warrant may
be           assigned by the Company to a successor in the event of a Fundamental
          Transaction. Subject to the preceding sentence, nothing in this Warrant shall
be           construed to give to any Person other than the Company and the Holder any
legal           or equitable right, remedy or cause of action under this Warrant. This
Warrant           may be amended only in writing signed by the Company and the Holder and
their           successors and assigns.  </font></p></td>
</tr>
</table>
<br>

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<Table Width=100% Cellpadding=0 Cellspacing=0>
<tr Valign=TOP>
<td Align=RIGHT Width=5%></td>
<td Width=95%><P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;(b) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company will not, by amendment of its governing documents or through any
          reorganization, transfer of assets, consolidation, merger, dissolution, issue
or           sale of securities or any other voluntary action, avoid or seek to avoid the
          observance or performance of any of the terms of this Warrant, but will at all
          times in good faith assist in the carrying out of all such terms and in the
          taking of all such action as may be necessary or appropriate in order to
protect           the rights of the Holder against impairment. Without limiting the
generality of           the foregoing, the Company (i)&nbsp;will not increase the par
value of any           Warrant Shares above the amount payable therefor on such exercise,
          (ii)&nbsp;will take all such action as may be reasonably necessary or
          appropriate in order that the Company may validly and legally issue fully paid
          and nonassessable Warrant Shares on the exercise of this Warrant, and
          (iii)&nbsp;will not close its stockholder books or records in any manner which
          interferes with the timely exercise of this Warrant.  </font></p></td>
</tr>
</table>
<br>

<p align=center>
<font size=2>10</font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>

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<Table Width=100% Cellpadding=0 Cellspacing=0>
<tr Valign=TOP>
<td Align=RIGHT Width=5%></td>
<td Width=95%><P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;(c) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>GOVERNING
LAW; VENUE; WAIVER OF JURY TRIAL</u>. ALL QUESTIONS CONCERNING THE
          CONSTRUCTION, VALIDITY, ENFORCEMENT AND INTERPRETATION OF THIS WARRANT SHALL BE
          GOVERNED BY AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE
          OF NEW YORK. EACH PARTY HEREBY IRREVOCABLY SUBMITS TO THE EXCLUSIVE
JURISDICTION           OF THE STATE AND FEDERAL COURTS SITTING IN THE CITY OF NEW YORK,
BOROUGH OF           MANHATTAN, FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN
CONNECTION           HEREWITH OR WITH ANY TRANSACTION CONTEMPLATED HEREBY OR DISCUSSED
HEREIN           (INCLUDING WITH RESPECT TO THE ENFORCEMENT OF ANY OF THE TRANSACTION
DOCUMENTS),           AND HEREBY IRREVOCABLY WAIVES, AND AGREES NOT TO ASSERT IN ANY
SUIT, ACTION OR           PROCEEDING, ANY CLAIM THAT IT IS NOT PERSONALLY SUBJECT TO THE
JURISDICTION OF           ANY SUCH COURT AND THAT SUCH SUIT, ACTION OR PROCEEDING IS
IMPROPER. EACH PARTY           HEREBY IRREVOCABLY WAIVES PERSONAL SERVICE OF PROCESS AND
CONSENTS TO PROCESS           BEING SERVED IN ANY SUCH SUIT, ACTION OR PROCEEDING BY
MAILING A COPY THEREOF           VIA REGISTERED OR CERTIFIED MAIL OR OVERNIGHT DELIVERY
(WITH EVIDENCE OF           DELIVERY) TO SUCH PARTY AT THE ADDRESS IN EFFECT FOR NOTICES
TO IT UNDER THIS           AGREEMENT AND AGREES THAT SUCH SERVICE SHALL CONSTITUTE GOOD
AND SUFFICIENT           SERVICE OF PROCESS AND NOTICE THEREOF. NOTHING CONTAINED HEREIN
SHALL BE DEEMED           TO LIMIT IN ANY WAY ANY RIGHT TO SERVE PROCESS IN ANY MANNER
PERMITTED BY LAW.           EACH OF THE COMPANY AND THE HOLDER HEREBY WAIVES ALL RIGHTS
TO A TRIAL BY JURY.  </font></p></td>
</tr>
</table>
<br>




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<Table Width=100% Cellpadding=0 Cellspacing=0>
<tr Valign=TOP>
<td Align=RIGHT Width=5%></td>
<td Width=95%><P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;(d) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
headings herein are for convenience only, do not constitute a part of this
          Warrant and shall not be deemed to limit or affect any of the provisions
hereof.  </font></p></td>
</tr>
</table>
<br>

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<Table Width=100% Cellpadding=0 Cellspacing=0>
<tr Valign=TOP>
<td Align=RIGHT Width=5%></td>
<td Width=95%><P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;(e) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
case any one or more of the provisions of this Warrant shall be invalid or
          unenforceable in any respect, the validity and enforceability of the remaining
          terms and provisions of this Warrant shall not in any way be affected or
          impaired thereby and the parties will attempt in good faith to agree upon a
          valid and enforceable provision which shall be a commercially reasonable
          substitute therefor, and upon so agreeing, shall incorporate such substitute
          provision in this Warrant.  </font></p></td>
</tr>
</table>
<br>

<P align=center><FONT FACE="Times New Roman, Times, Serif" SIZE=2>[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK,
<Br>SIGNATURE PAGE FOLLOWS]
</FONT></P>

<p align=center>
<font size=2>11</font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;IN
WITNESS WHEREOF, the Company has caused this Warrant to be duly executed by its authorized
officer as of the date first indicated above. </font></p>


<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
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<TR VALIGN=Bottom>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
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<TR VALIGN=Bottom>
     <TH WIDTH=50%><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH WIDTH=5% ><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH WIDTH=45%><FONT FACE="Times New Roman" SIZE=1></FONT></TH></TR>
<TR VALIGN=Bottom>
     <TD  ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT colspan=2><FONT FACE="Times New Roman" SIZE=2>SILICOM LTD.</FONT></TD>
</TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>By:</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>_________________________</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Name:</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>_________________________</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Title:</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>_________________________</FONT></TD></TR>
</TABLE>
<Br>

<p align=center>
<font size=2>12</font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>



<!-- MARKER FORMAT-SHEET="Head Minor Center-TNR" FSL="Workstation" -->
<P Align=CENTER><Font Face="Times New Roman, Times, Serif" Size=2>FORM OF EXERCISE NOTICE </font></p>

<!-- MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation" -->
<P><Font Face="Times New Roman, Times, Serif" Size=2>(To be executed by the Holder to
exercise the right to purchase Ordinary Shares under the foregoing Warrant) </font></p>

<!-- MARKER FORMAT-SHEET="Head Left-TNR" FSL="Default" -->
<P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>To: SILICOM LTD. </font></p>

<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The  undersigned  is the  Holder of  Warrant  No.  _______  (the  "<B>Warrant</b>")  issued by  SILICOM  LTD.,  an Israeli
corporation  (the  "<B>Company</b>").  Capitalized  terms  used  herein  and not  otherwise  defined  have the  respective
meanings set forth in the Warrant.
</FONT></P>
<!-- MARKER FORMAT-SHEET="Para (List) Hang Lv 0-TNR" FSL="Workstation" -->
     <Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
          <Tr Valign=TOP>
          <Td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>1.</font></td>
          <Td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>
          The Warrant is currently exercisable to purchase a total of ______________
          Warrant Shares. </font></td>
          </tr>
          </table>
          <Br>

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     <Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
          <Tr Valign=TOP>
          <Td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>2.</font></td>
          <Td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>
          The undersigned Holder hereby exercises its right to purchase _________________
          Warrant Shares pursuant to the Warrant. </font></td>
          </tr>
          </table>
          <Br>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Lv 0-TNR" FSL="Default" -->
     <Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
          <Tr Valign=TOP>
          <Td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>3.</font></td>
          <Td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>
          The Holder intends that payment of the Exercise Price shall be made as (check
          one): </font></td>
          </tr>
          </table>
          <Br>


<!-- MARKER FORMAT-SHEET="Para Hang Lv 2-TNR" FSL="Workstation" -->
<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=10%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>                  ____ </font></td>
<td Width=85%><Font Face="Times New Roman, Times, Serif" Size=2>"Cash
Exercise" under Section 10 </font></td>
</tr>
</table>
<br>

<!-- MARKER FORMAT-SHEET="Para Hang Lv 2-TNR" FSL="Workstation" -->
<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=10%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>                  ____ </font></td>
<td Width=85%><Font Face="Times New Roman, Times, Serif" Size=2>"Cashless
Exercise" under Section 10 </font></td>
</tr>
</table>
<br>


<!-- MARKER FORMAT-SHEET="Para (List) Hang Lv 0-TNR" FSL="Workstation" -->
     <Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
          <Tr Valign=TOP>
          <Td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>4.</font></td>
          <Td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>
          If the holder has elected a Cash Exercise, the holder shall pay the sum of
          $____________ to the Company in accordance with the terms of the Warrant. </font></td>
          </tr>
          </table>
          <Br>

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     <Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
          <Tr Valign=TOP>
          <Td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>5.</font></td>
          <Td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>
          Pursuant to this exercise, the Company shall deliver to the holder
          _______________ Warrant Shares in accordance with the terms of the Warrant. </font></td>
          </tr>
          </table>
          <Br>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Lv 0-TNR" FSL="Workstation" -->
     <Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
          <Tr Valign=TOP>
          <Td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>6.</font></td>
          <Td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>
          Following this exercise, the Warrant shall be exercisable to purchase a total of
          ______________ Warrant Shares. </font></td>
          </tr>
          </table>
          <Br>

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     <Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
          <Tr Valign=TOP>
          <Td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>7.</font></td>
          <Td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>
          Please issue a certificate or certificates representing said Warrant Shares in
          the name of the undersigned or in the name of _____________. </font></td>
          </tr>
          </table>
          <Br>

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     <Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
          <Tr Valign=TOP>
          <Td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>8.</font></td>
          <Td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>
          The Warrant Shares shall be delivered to the following DWAC Account Number or by
          physical delivery of a certificate to: _________________________. </font></td>
          </tr>
          </table>
          <Br>

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     <Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
          <Tr Valign=TOP>
          <Td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>9.</font></td>
          <Td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>
          The undersigned is an &#147;accredited investor&#148; as defined in Regulation D
          promulgated under the Securities Act of 1933, as amended. </font></td>
          </tr>
          </table>
          <Br>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Lv 0-TNR" FSL="Default" -->
     <Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
          <Tr Valign=TOP>
          <Td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>10.</font></td>
          <Td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>
          In exercising this Warrant, the undersigned hereby confirms and acknowledges
          that the Warrant Shares are being acquired solely for the account of the
          undersigned and not as a nominee for any other party, or for investment, and
          that the undersigned will not offer, sell or otherwise dispose of any such
          Warrant Shares except under circumstances that will not result in a violation of
          the Securities Act of 1933, as amended, or any state securities laws. </font></td>
          </tr>
          </table>
          <Br>

<p align=center>
<font size=2>13</font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>



<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
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<TR VALIGN=Bottom>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
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     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
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     <TH WIDTH=40%><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
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     <TH WIDTH=55%><FONT FACE="Times New Roman" SIZE=1></FONT></TH></TR>
<TR VALIGN=Bottom>
     <TD  ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Dated:  ____________________, ______</FONT></TD>
     <TD ALIGN=LEFT colspan=2><FONT FACE="Times New Roman" SIZE=2>Name of Holder:</FONT></TD>
</TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>(Print)</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>__________________________________________________________</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>By:</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>__________________________________________________________</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Name:</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>__________________________________________________________</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Title:</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>__________________________________________________________</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>(Signature must conform in all respects to name of holder<Br>as specified on the face of the Warrant)</FONT></TD></TR>
</TABLE>
<Br>

<p align=center>
<font size=2>14</font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>


<!-- MARKER FORMAT-SHEET="Head Minor Center-TNR" FSL="Workstation" -->
<P Align=CENTER><Font Face="Times New Roman, Times, Serif" Size=2>FORM OF ASSIGNMENT </font></p>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P Align="Center"><Font Face="Times New Roman, Times, Serif" Size=2>[To be completed and signed only upon transfer of Warrant] </font></p>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Default" -->
<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;FOR
VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto
________________________________ the right represented by the within Warrant to purchase
____________ Ordinary Shares of SILICOM LTD. to which the within Warrant relates and
appoints ________________ attorney to transfer said right on the books of SILICOM LTD.
with full power of substitution in the premises. </font></p>


<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Dated:  ____________________, ______</FONT></P>

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<TR VALIGN=Bottom>
     <TD WIDTH=50% ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=50% ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>(Signature must conform in all respects to name of</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>holder as specified on the face of the Warrant)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>_________________________________________________</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Address of Transferee</FONT></TD></TR>
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     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD></TR>
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     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>_________________________________________________</FONT></TD></TR>
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     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>_________________________________________________</FONT></TD></TR>
</TABLE>
<Br>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>In the presence of: </font></p>

<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>_________________________________________________</FONT></P>

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<DOCUMENT>
<TYPE>EX-99
<SEQUENCE>5
<FILENAME>exhibit_99-4.htm
<TEXT>
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     <!-- Project:        \\Backup\office\EDGAR Filing\Silicom Ltd\73702\a73702.eep        -->
     <!-- Control Number: 73702                                                            -->
     <!-- Rev Number:     1                                                                -->
     <!-- Client Name:    Silicom Ltd                                                      -->
     <!-- Project Name:   6-K                                                              -->
     <!-- Firm Name:      Zadok-Keinan Ltd                                                 -->
     <TITLE>6-K</TITLE>
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<P Align="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><U><B>Exhibit 99.4</B></U> </FONT> </P>

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<P Align=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><U><B>EXHIBIT E</B></U> </FONT> </p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2><B>NEITHER THIS SECURITY NOR THE
SECURITIES FOR WHICH THIS SECURITY IS EXERCISABLE HAVE BEEN REGISTERED WITH THE SECURITIES
AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN
EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
&#147;SECURITIES ACT&#148;), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT
TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN
AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS
AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR TO SUCH EFFECT, THE SUBSTANCE
OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY. THIS SECURITY AND THE SECURITIES
ISSUABLE UPON EXERCISE OF THIS SECURITY MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE
MARGIN ACCOUNT OR OTHER LOAN SECURED BY SUCH SECURITIES.</b> </font></p>

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<P Align=CENTER><Font Face="Times New Roman, Times, Serif" Size=2>SILICOM LTD. </font></p>

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<P Align=CENTER><Font Face="Times New Roman, Times, Serif" Size=2><U>WARRANT</u></font></p>


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     <TD WIDTH=50% ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Warrant No. [&nbsp;&nbsp;]</FONT></TD>
     <Td Width="50%" Align="Right"><FONT FACE="Times New Roman" SIZE=2>Dated: May __, 2007</FONT></TD></TR>
</TABLE><Br>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;SILICOM
LTD., an Israeli corporation (the &#147;<B>Company</b>&#148;), hereby certifies that, for
value received, CD Investment Partners, Ltd. or its registered assigns (the
&#147;<B>Holder</b>&#148;), is entitled to purchase from the Company up to a total of
8,750 ordinary shares, NIS 0.01 par value per share (the &#147;<B>Ordinary
Shares</b>&#148;), of the Company (each such share, a &#147;<B>Warrant Share</b>&#148; and
all such shares, the &#147;<B>Warrant Shares</b>&#148;) at an exercise price equal to
$28.25 per share (as adjusted from time to time as provided in <U>Section&nbsp;9</u>, the
&#147;<B>Exercise Price</b>&#148;), at any time on or after the date hereof (the
&#147;<B>Initial Exercise Date</b>&#148;) and through and including the date that is three
(3) years from the Effective Date (the &#147;<B>Expiration Date</b>&#148;), and subject to
the following terms and conditions. This Warrant (this &#147;<B>Warrant</b>&#148;) is
being issued pursuant to that certain Securities Purchase Agreement, dated as of
May&nbsp;3, 2007, by and between the Company and CD Investment Partners, Ltd. (the
&#147;<B>Purchase Agreement</b>&#148;). </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;1. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Definitions</u>.
In addition to the terms defined elsewhere in this Warrant,           capitalized terms
that are not otherwise defined herein have the meanings given           to such terms in
the Purchase Agreement.  </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;2. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Warrant
Register</u>. The Company shall register this Warrant, upon records           to be
maintained by the Company for that purpose (the &#147;<B>Warrant           Register</b>&#148;),
in the name of the Holder of record hereof from time to           time. The Company may
deem and treat the registered Holder of this Warrant as           the absolute owner
hereof for the purpose of any exercise hereof or any           distribution to the
Holder, and for all other purposes, absent actual notice to           the contrary.  </font></p>




<p align=center>
<font size=2>- 1 -</font></p>
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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;3. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Registration
of Transfers</u>. The Company shall register the transfer of any           portion of
this Warrant in the Warrant Register, upon surrender of this Warrant,           with the
Form of Assignment attached hereto duly completed and signed, and with           such
other documentation the Company may reasonably request, to the Company at           its
address specified herein. Upon any such registration of transfer, a new           warrant
to purchase Ordinary Shares in substantially the form of this Warrant           (any such
new warrant, a &#147;<B>New Warrant</b>&#148;), evidencing the portion           of this
Warrant so transferred shall be issued to the transferee and a New           Warrant
evidencing the remaining portion of this Warrant not so transferred, if           any,
shall be issued to the transferring Holder. The acceptance of the New           Warrant
by the transferee thereof shall be deemed the acceptance by such           transferee of
all of the rights and obligations of a holder of a Warrant.  </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;4. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Exercise
and Duration of Warrant</u>.  </font></p>

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<Table Width=100% Cellpadding=0 Cellspacing=0>
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<td Align=RIGHT Width=5%></td>
<td Width=95%><P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;(a) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This
Warrant shall be exercisable by the registered Holder at any time and from           time
to time on or after the Initial Exercise Date to and including the           Expiration
Date. At 5:00&nbsp;P.M., New York City time on the Expiration Date,           the portion
of this Warrant not exercised prior thereto shall be and become void           and of no
value.  </font></p></td>
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</table>
<br>

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<td Width=95%><P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;(b) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A
Holder may exercise this Warrant by delivering to the Company (i)&nbsp;an
          exercise notice, in the form attached hereto (the &#147;<B>Exercise
          Notice</b>&#148;), appropriately completed and duly signed, and           (ii)&nbsp;payment
of the Exercise Price for the number of Warrant Shares as to           which this Warrant
is being exercised (which may take the form of a           &#147;cashless exercise&#148; if
so indicated in the Exercise Notice and only if           a &#147;cashless exercise&#148; may
occur at such time pursuant to           Section&nbsp;10 below), and the date such items
are delivered to the Company (as           determined in accordance with the provisions
hereof) is an &#147;<B>Exercise           Date</b>.&#148; The Holder shall not be
required to deliver the original Warrant           in order to effect an exercise
hereunder. Execution and delivery of the Exercise           Notice shall have the same
effect as cancellation of the original Warrant and           issuance of a New Warrant
evidencing the right to purchase the remaining number           of Warrant Shares. At the
Company&#146;s discretion, the Company, may, by           written notice, require the
Holder to furnish the Exercise Notice and/or other           related documentation,
directly to the Transfer Agent (with a copy to the           Company).  </font></p></td>
</tr>
</table>
<br>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;5. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Delivery
of Warrant Shares</u>.  </font></p>

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<td Align=RIGHT Width=5%></td>
<td Width=95%><P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;(a) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Upon
exercise of this Warrant and receipt of the Exercise Price by the Company           in
accordance with Section&nbsp;4 and Section&nbsp;10, the Company shall           promptly
(but in no event later than five (5) Trading Days after the Exercise           Date)
issue or cause to be issued and cause to be delivered to or upon the           written
order of the Holder and in such name or names as the Holder may           designate, a
certificate for the Warrant Shares issuable upon such exercise,           free of
restrictive legends (if permitted under Section 4.1 of the Purchase           Agreement).
The Holder, or any Person so designated by the Holder to receive           Warrant
Shares, shall be deemed to have become the holder of record of such           Warrant
Shares as of the Exercise Date. The Company shall, upon request of the           Holder,
use its best efforts to deliver Warrant Shares hereunder electronically           through
the facilities of The Depository Trust Company or another established           clearing
corporation performing similar functions acceptable to the Transfer           Agent.  </font></p></td>
</tr>
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<br>

<p align=center>
<font size=2>- 2 -</font></p>
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<td Align=RIGHT Width=5%></td>
<td Width=95%><P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;(b) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This
Warrant is exercisable, either in its entirety or, from time to time, for a
          portion of the number of Warrant Shares. Upon surrender of this Warrant
          following one or more partial exercises, the Company shall issue or cause to be
          issued, at its expense, a New Warrant evidencing the right to purchase the
          remaining number of Warrant Shares.  </font></p></td>
</tr>
</table>
<br>

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<td Width=95%><P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;(c) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
addition to any other rights available to a Holder, if the Company fails to
          deliver to the Holder a certificate representing Warrant Shares by the third
          (3<Sup>rd</sup>) Trading Day after the date on which delivery of such
          certificate is required by this Warrant (the &#147;<B>Exercise Date</b>&#148;),
          and if after such third (3<Sup>rd</sup>) Trading Day the Holder purchases (in
an           open market transaction or otherwise) Ordinary Shares to deliver in
satisfaction           of a sale by the Holder of the Warrant Shares that the Holder
anticipated           receiving from the Company (a &#147;<B>Buy-In</b>&#148;), then the
Company           shall, within three (3)&nbsp;Trading Days after the Holder&#146;s
request and in           the Company&#146;s discretion, either (i)&nbsp;pay cash to the
Holder in an           amount equal to the Holder&#146;s total purchase price (including
brokerage           commissions, if any) for the Ordinary Shares so purchased (the &#147;<B>Buy-In
          Price</b>&#148;), at which point the Company&#146;s obligation to deliver such
          certificate (and to issue such Ordinary Shares) shall terminate, or
          (ii)&nbsp;promptly honor its obligation to deliver to the Holder a certificate
          or certificates representing such Ordinary Shares the Company failed to deliver
          and pay cash to the Holder in an amount equal to the excess (if any) of the
          Buy-In Price over the product of (A) such number of Ordinary Shares, times (B)
          the Closing Price on the Exercise Date.  </font></p></td>
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<br>

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<td Width=95%><P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;(d) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company&#146;s obligations to issue and deliver Warrant Shares in accordance
          with the terms hereof are absolute and unconditional, irrespective of any
action           or inaction by the Holder to enforce the same, any waiver or consent
with           respect to any provision hereof, the recovery of any judgment against any
Person           or any action to enforce the same, or any setoff, counterclaim,
recoupment,           limitation or termination, or any breach or alleged breach by the
Holder or any           other Person of any obligation to the Company or any violation or
alleged           violation of law by the Holder or any other Person, and irrespective of
any           other circumstance which might otherwise limit such obligation of the
Company to           the Holder in connection with the issuance of Warrant Shares.
Nothing herein           shall limit a Holder&#146;s right to pursue any other remedies
available to it           hereunder, at law or in equity including, without limitation, a
decree of           specific performance and/or injunctive relief with respect to the
Company&#146;s           failure to timely deliver certificates representing Ordinary
Shares upon           exercise of this Warrant as required pursuant to the terms hereof.  </font></p></td>
</tr>
</table>
<br>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;6. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Charges,
Taxes and Expenses</u>. Issuance and delivery of certificates for           Ordinary
Shares upon exercise of this Warrant shall be made without charge to           the Holder
for any issue or transfer tax, withholding tax, transfer agent fee or           other
incidental tax or expense in respect of the issuance of such certificates,           all
of which taxes and expenses shall be paid by the Company; <U>provided</u>, <U>however</u>,
that the Company shall not be required to pay any tax which may           be payable in
respect of any transfer involved in the registration of any           certificates for
Warrant Shares or Warrant in a name other than that of the           Holder. The Holder
shall be responsible for all other tax liability that may           arise as a result of
holding or transferring this Warrant or receiving Warrant           Shares upon exercise
hereof. Except as expressly set forth herein, in no event           shall the Company be
responsible for any broker or similar commissions and such           shall be borne by
the Holder.  </font></p>

<p align=center>
<font size=2>- 3 -</font></p>
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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;7. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Replacement
of Warrant</u>. If this Warrant is mutilated, lost, stolen or           destroyed, the
Company shall issue or cause to be issued in exchange and           substitution for and
upon cancellation hereof, or in lieu of and substitution           for this Warrant, a
New Warrant, but only upon receipt of evidence reasonably           satisfactory to the
Company of such loss, theft or destruction and customary and           reasonable bond or
indemnity, if requested. Applicants for a New Warrant under           such circumstances
shall also comply with such other reasonable regulations and           procedures and pay
such other reasonable third-party costs as the Company may           prescribe.  </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;8. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Reservation
of Warrant Shares</u>. The Company covenants that it will at all           times reserve
and keep available out of the aggregate of its authorized but           unissued and
otherwise unreserved Ordinary Shares, solely for the purpose of           enabling it to
issue Warrant Shares upon exercise of this Warrant as herein           provided, the
number of Warrant Shares which are then issuable and deliverable           upon the
exercise of this entire Warrant, free from preemptive rights or any           other
contingent purchase rights of persons other than the Holder (after giving
          effect to the adjustments and restrictions of Section&nbsp;9, if any). The
          Company covenants that all Warrant Shares so issuable and deliverable shall,
          upon issuance and the payment of the applicable Exercise Price in accordance
          with the terms hereof, be duly and validly authorized, issued and fully paid
and           nonassessable. The Company will take all such action as may be necessary to
          assure that such Ordinary Shares may be issued as provided herein without
          violation of any applicable law or regulation, or of any requirements of any
          securities exchange or automated quotation system upon which the Ordinary
Shares           may be listed.  </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;9. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Certain
Adjustments</u>. The Exercise Price and number of Warrant Shares           issuable upon
exercise of this Warrant are subject to adjustment from time to           time as set
forth in this Section&nbsp;9.  </font></p>

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<td Width=95%><P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;(a) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Stock
Dividends and Splits</u>. If the Company, at any time while this           Warrant is
outstanding, (i)&nbsp;pays a stock dividend on its Ordinary Shares or           otherwise
makes a distribution on any class of capital stock that is payable in           Ordinary
Shares, (ii)&nbsp;subdivides outstanding Ordinary Shares into a larger           number
of shares, or (iii)&nbsp;combines outstanding Ordinary Shares into a           smaller
number of shares, then in each such case the Exercise Price shall be           multiplied
by a fraction of which the numerator shall be the number of Ordinary           Shares
outstanding immediately before such event (excluding treasury shares, if           any)
and of which the denominator shall be the number of Ordinary Shares           outstanding
immediately after such event (excluding treasury shares, if any).           Any
adjustment made pursuant to clause (i)&nbsp;of this paragraph shall become
          effective immediately after the record date for the determination of
          stockholders entitled to receive such dividend or distribution (<U>provided</u>,
<U>however</u>, that if such record date is fixed and such dividend is not fully
          paid or if such distribution is not fully made on the date fixed therefor, the
          Exercise Price shall be recomputed accordingly as of the close of business on
          such record date and thereafter the Exercise Price shall be adjusted pursuant
to           this Section as of the time of the actual payment of such dividends or
          distribution), and any adjustment pursuant to clause&nbsp;(ii) or (iii) of this
          paragraph shall become effective immediately after the effective date of such
          subdivision or combination.  </font></p></td>
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</table>
<br>

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<font size=2>- 4 -</font></p>
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<td Width=95%><P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;(b) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Pro
Rata Distributions</u>. If the Company, at any time while this Warrant is
          outstanding, distributes to holders of Ordinary Shares (i)&nbsp;any equity
          security (other than a distribution of Ordinary Shares covered by the preceding
          paragraph), (ii)&nbsp;rights or warrants to subscribe for or purchase any
equity           security, or (iii)&nbsp;any other asset other than cash dividends out of
          earnings (in each case, &#147;<B>Distributed Property</b>&#148;), then in each
          such case the Holder shall be entitled upon exercise of this Warrant for the
          purchase of any or all of the Warrant Shares, to receive the amount of
          Distributed Property which would have been payable to the Holder had such
Holder           been the holder of such Warrant Shares on the record date for the
determination           of shareholders entitled to such Distributed Property. The
Company will at all           times set aside and keep available for distribution to such
holder upon exercise           of this Warrant a portion of the Distributed Property to
satisfy the           distribution to which such Holder is entitled pursuant to the
preceding           sentence.  </font></p></td>
</tr>
</table>
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<td Width=95%><P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;(c) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Fundamental
Transactions</u>. If any capital reorganization, reclassification           of the
capital stock of the Company, consolidation or merger of the Company with
          another company in which the Company is not the survivor, or sale, transfer or
          other disposition of all or substantially all of the Company&#146;s assets to
          another corporation shall be effected (all such transactions being hereinafter
          referred to as a &#147;<B>Fundamental Transaction</b>&#148;), then the Company
          shall use its best efforts to ensure that lawful and adequate provision shall
be           made whereby the Holder shall thereafter have the right to purchase and
receive           upon the basis and upon the terms and conditions herein specified and
in lieu of           the Warrant Shares immediately theretofore issuable upon exercise of
this           Warrant, such shares of stock, securities or assets as would have been
issuable           or payable with respect to or in exchange for a number of Warrant
Shares equal           to the number of Warrant Shares immediately theretofore issuable
upon exercise           of this Warrant, had such reorganization, reclassification,
consolidation,           merger, sale, transfer or other disposition not taken place, and
in any such           case appropriate provision shall be made with respect to the rights
and           interests of the Holder to the end that the provisions hereof (including,
          without limitation, provision for adjustment of the Exercise Price) shall
          thereafter be applicable, as nearly equivalent as may be practicable in
relation           to any share of stock, securities or assets thereafter deliverable
upon the           exercise thereof. The Company shall not effect any such consolidation,
merger,           sale, transfer or other disposition unless prior to or simultaneously
with the           consummation thereof the successor company (if other than the Company)
resulting           from such consolidation or merger, or the company purchasing or
otherwise           acquiring such assets or other appropriate corporation or entity
shall assume           the obligation to deliver to the Holder, at the last address of
the Holder           appearing on the books of the Company, such shares of stock,
securities or           assets as, in accordance with the foregoing provisions, the
Holder may be           entitled to purchase, and the other obligations under this
Warrant. The           provisions of this Section&nbsp;9(c) shall similarly apply to
successive           reorganizations, reclassifications, consolidations, mergers, sales,
transfers or           other dispositions, each of which transactions shall also
constitute a           Fundamental Transaction. Notwithstanding the foregoing, if any
Fundamental           Transaction constitutes or results in (a)&nbsp;a &#147;going private&#148;          transaction
as defined in Rule&nbsp;13e-3 under the Exchange Act, (b)&nbsp;an           acquisition
of the Company primarily for cash, or (c)&nbsp;an acquisition,           merger or sale
with or into a Person not traded on an Eligible Market, then the           Company (or
any such successor or surviving entity) shall require that Holder           waive the
above requirements of this Section 9(c) in exchange for a payment of           cash on
the closing date of such Fundamental Transaction, equal to the Black           Scholes
Value of the remaining unexercised portion of this Warrant on the           closing date
of such Fundamental Transaction, provided that the per share           consideration to
be received by the holders of Ordinary Shares upon the           consummation of such
Fundamental Transaction is less than the Exercise Price.           Concurrently with such
payment, this Warrant shall be cancelled. &#147;<B>Black           Scholes Value</b>&#148; means
the value of this Warrant based on the Black and           Scholes Option Pricing Model
obtained from the &#147;OV&#148; function on           Bloomberg determined as of the day
immediately following the public announcement           of the applicable Fundamental
Transaction and reflecting (i)&nbsp;a risk-free           interest rate corresponding to
the U.S. Treasury rate for a period equal to the           remaining term of this Warrant
as of such date and (ii)&nbsp;an expected           volatility equal to the lesser of (x)
60 &#150; or (y) 100 &#150; day volatility           obtained from the HVT function on
Bloomberg.  </font></p></td>
</tr>
</table>
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<td Width=95%><P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;(d) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Subsequent
Equity Sales</u>.  </font></p></td>
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<td Width=90%><P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;(i) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If,
at any time from the date hereof until twelve (12) months from the Closing
          Date, the Company issues additional Ordinary Shares or rights, warrants,
options           or other securities or debt convertible, exercisable or exchangeable
for           Ordinary Shares or otherwise entitling any Person to acquire Ordinary
Shares           (collectively, <B>&#147;Ordinary Share Equivalents&#148;</b>) at an
effective           price to the Company per share of Ordinary Shares (the <B>&#147;Effective
          Price&#148;</b>) less than the Exercise Price (as adjusted hereunder to such
          date but excluding the operation of this paragraph (d) as a result of such
          issuance), then the total maximum number of Ordinary Shares issuable upon
          conversion, exercise or exchange of all then outstanding Ordinary Share
          Equivalents shall be deemed to be outstanding as of the date of issuance of
such           Ordinary Share Equivalents and the Exercise Price shall be reduced to
equal the           product of (A) the Exercise Price in effect immediately prior to such
new           issuance of Ordinary Shares or Ordinary Share Equivalents times (B) a
fraction,           the numerator of which is the sum of (1) the number of Ordinary
Shares           outstanding or deemed to be outstanding immediately prior to such
issuance, plus           (2) the number of Ordinary Shares which the aggregate Effective
Price of the           Ordinary Shares issued (or deemed to be issued) would purchase at
the Exercise           Price (as adjusted hereunder to such date but excluding the
operation of this           paragraph (d) as a result of such issuance), and the
denominator of which is the           aggregate number of Ordinary Shares outstanding or
deemed to be outstanding           immediately after such issuance. Notwithstanding the
foregoing, in no event           shall the Exercise Price be reduced below $23.13 per
share (as appropriately           adjusted for any event described in paragraph (a) of
this Section) through the           operation of this paragraph (d). For purposes of this
paragraph, (A) the maximum           number of Ordinary Shares potentially issuable at
any time upon conversion,           exercise or exchange of the relevant Ordinary Share
Equivalents (the <B>&#147;Deemed Number&#148;</b>) shall be deemed to be outstanding upon
          issuance of such Ordinary Share Equivalents (without regard to any provision
          contained therein for a subsequent adjustment to such number of shares), (B)
the           Effective Price applicable to a new issuance of Ordinary Shares shall equal
the           minimum dollar value of consideration payable to the Company to purchase
such           Ordinary Shares and the Effective Price applicable to a new issuance of
Ordinary           Share Equivalents shall equal the minimum dollar value of
consideration payable           to the Company to purchase such Ordinary Share
Equivalents and to convert,           exercise or exchange such Ordinary Share
Equivalents into Ordinary Shares           (without regard to any provision contained
therein for a subsequent adjustment           to such number of shares), divided by the
Deemed Number, and (C) no further           adjustment shall be made to the Exercise
Price upon the actual issuance of           Ordinary Shares upon conversion, exercise or
exchange of such Ordinary Share           Equivalents. If such Ordinary Share Equivalents
by their terms provide, with the           passage of time or otherwise, for any decrease
in the consideration payable to           the Company, or increase in the number of
Ordinary Shares issuable upon the           exercise, conversion or exchange thereof,
other than pursuant to customary           &#147;weighted average&#148; anti-dilution
provisions, the Exercise Price           computed upon the original issue thereof, and
any subsequent adjustments based           thereon, shall, upon any such decrease or
increase becoming effective, be           recomputed to reflect such decrease or increase
insofar as it affects such           Ordinary Share Equivalents. On the expiration of any
Ordinary Share Equivalent,           or the termination of any such right to convert or
exchange any such Ordinary           Share Equivalent into or for Ordinary Shares, the
Exercise Price then in effect           hereunder shall forthwith be readjusted
(increased or decreased, as the case may           be) to the Exercise Price which would
have been in effect at the time of such           expiration or termination had such
Ordinary Share Equivalent, to the extent           outstanding immediately prior to such
expiration or termination, never been           granted, issued or sold, and the Ordinary
Shares issuable thereunder shall no           longer be deemed to be outstanding.  </font></p></td>
</tr>
</table>
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<font size=2>- 6 -</font></p>
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<td Width=90%><P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;(ii) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Notwithstanding
the foregoing, no adjustment will be made under this paragraph           (d) in respect
of any Excluded Stock. For purposes hereof, <B>&#147;Excluded           Stock&#148;</b> shall
mean Ordinary Shares or Ordinary Share Equivalents issued           or deemed issued (v)&nbsp;upon
the exercise of stock options outstanding on the           date hereof, (w) upon the
issuance of Ordinary Shares or stock options to           employees, officers, directors,
service providers or consultants of the Company           or a Subsidiary pursuant to any
stock or option plan of the Company or other           arrangement, including subsequent
to the date hereof (including the issuance of           Ordinary Shares upon exercise of
stock options), (x) to banks, equipment lessors           or other financial
institutions, or to real property lessors, pursuant to a debt           financing,
equipment leasing or real property leasing transaction, (y) pursuant           to the
acquisition of another company or legal entity by the Company by merger,
          purchase of substantially all of the assets or other reorganization or pursuant
          to a joint venture agreement, (z) in connection with marketing or similar
          agreements or strategic partnerships (including, without limitation, by way of
a           private placement to strategic investors and/or entities (whatever the legal
          form) in which, or of which, one or more members of the Company&#146;s
          management or board of directors beneficially owns or controls an equity stake
          of 10% or greater), (aa)&nbsp;in a registered public offering, (bb) upon the
          exercise or exchange of or conversion of (1) any Securities issued under the
          Purchase Agreement or hereunder or (2) securities to a registered broker-dealer
          in connection with the transactions contemplated by the Purchase Agreement, and
          (cc) Ordinary Shares or other securities issued in connection with any stock
          split, stock dividend or recapitalization of the Company (without derogating
          from Section 9(a) hereof).  </font></p></td>
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<td Width=90%><P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;(iii) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Notwithstanding
anything to the contrary, no adjustment in the Exercise Price           need be made if
such adjustment would result in (i) a change in the Exercise           Price of less than
$0.01 or (ii) the Exercise Price being reduced to less than           the par value of
the Ordinary Shares.  </font></p></td>
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<td Width=95%><P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;(e) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Number
of Warrant Shares</u>. Simultaneously with any adjustment to the           Exercise Price
pursuant to paragraph&nbsp;(a) of this Section, the number of           Warrant Shares
that may be purchased upon exercise of this Warrant shall be           increased or
decreased (as the case may be), proportionately, so that after such           adjustment
the aggregate Exercise Price payable hereunder for the decreased or           increased
(as the case may be) number of Warrant Shares shall be the same as the
          aggregate Exercise Price in effect immediately prior to such adjustment.  </font></p></td>
</tr>
</table>
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<td Width=95%><P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;(f) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Calculations</u>.
All calculations under this Section&nbsp;9 shall be made to           the nearest cent or
the nearest 1/100th of a share, as applicable. The number of           Ordinary Shares
outstanding at any given time shall not include shares owned or           held by or for
the account of the Company, and the disposition of any such           shares shall be
considered an issue or sale of Ordinary Shares.  </font></p></td>
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<td Width=95%><P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;(g) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Notice
of Adjustments</u>. Upon the occurrence of each adjustment pursuant to           this
Section&nbsp;9, the Company at its expense will promptly compute such
          adjustment in accordance with the terms of this Warrant and prepare a
          certificate setting forth such adjustment, including a statement of the
adjusted           Exercise Price and adjusted number or type of Warrant Shares or other
securities           issuable upon exercise of this Warrant (as applicable), describing
the           transactions giving rise to such adjustments and showing in detail the
facts           upon which such adjustment is based. Upon written request, the Company
will           promptly deliver a copy of each such certificate to the Holder and to the
          Transfer Agent.  </font></p></td>
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<td Width=95%><P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;(h) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Notice
of Corporate Events</u>. If the Company (i)&nbsp;declares a dividend           or any
other distribution of cash, securities or other property in respect of           its
Ordinary Shares, including without limitation any granting of rights or
          warrants to subscribe for or purchase any capital stock of the Company,
          (ii)&nbsp;authorizes or approves, enters into any agreement contemplating, or
          solicits stockholder approval for, any Fundamental Transaction or
          (iii)&nbsp;authorizes the voluntary dissolution, liquidation or winding up of
          the affairs of the Company, then the Company shall deliver to the Holder a
          notice describing the material terms and conditions of such transaction, at
          least ten (10) calendar days prior to the applicable record or effective date
on           which a Person would need to hold Ordinary Shares in order to participate in
or           vote with respect to such transaction, and the Company will take all steps
          reasonably necessary in order to insure that the Holder is given the practical
          opportunity to exercise this Warrant prior to such time so as to participate in
          or vote with respect to such transaction; <U>provided</u>, <U>however</u>, that
          the failure to deliver such notice or any defect therein shall not affect the
          validity of the corporate action required to be described in such notice.  </font></p></td>
</tr>
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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;10. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Payment
of Exercise Price</u>. The Holder shall pay the Exercise Price in           immediately
available funds in U.S. dollars; <U>provided</u>, <U>however</u>,           that if at
any time after the Required Effective Date a Registration Statement           covering
the resale of the Warrant Shares is not effective on the Exercise Date,           the
Holder may satisfy its obligation to pay the Exercise Price through a           &#147;cashless
exercise,&#148; in which event the Company shall issue to the           Holder the number
of Warrant Shares determined as follows:  </font></p>

<TABLE CELLPADDING=3 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <Th> </th>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH></TR>
<TR VALIGN=Bottom>
     <Th> </th>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH></TR>
<TR VALIGN=Bottom>
     <Th> </th>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH></TR>
<TR VALIGN=Bottom>
     <Th> </th>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH></TR>
<TR VALIGN=Bottom>
     <Th> </th>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH></TR>
<TR VALIGN=Bottom>
     <Td WIDTH=10%> </td>
     <TD WIDTH=5% ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=85% ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>X = (Y) (A-B)/A</FONT></TD></TR>
<TR VALIGN=Bottom>
     <Td> </td>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>where:</FONT></TD></TR>
<TR VALIGN=Bottom>
     <Td> </td>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>X = the number of Warrant Shares to be issued to the Holder.</FONT></TD></TR>
<TR VALIGN=Bottom>
     <Td> </td>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <Td> </td>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Y = the number of Warrant Shares with respect to which this Warrant is being exercised.</FONT></TD></TR>
<TR VALIGN=Bottom>
     <Td> </td>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <Td> </td>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>A = the average of the Closing Prices for the five Trading Days immediately prior to (but not including) the Exercise Date.</FONT></TD></TR>
<TR VALIGN=Bottom>
     <Td> </td>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <Td> </td>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>B = the Exercise Price.</FONT></TD></TR>
</TABLE>
<Br>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For
purposes of Rule 144 promulgated under the Securities 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 Purchase Agreement. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;11. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Limitation
on Exercise</u>. Notwithstanding
anything to the contrary contained herein, this Warrant shall not be exercisable by the
Holder hereof to the extent (but only to the extent) that, if exercisable by the Holder,
the Holder or any of its affiliates would beneficially own in excess of 4.90% (the
&#147;<B>Maximum</b> <B>Percentage</b>&#148;) of the issued and outstanding Ordinary
Shares. To the extent the above limitation applies, the determination of whether this
Warrant shall be exercisable (vis-a-vis other convertible, exercisable or exchangeable
securities owned by the Holder) and of which warrants shall be exercisable (as among all
warrants owned by the Holder) shall, subject to such Maximum Percentage limitation, be
determined by the Holder. No prior inability to exercise this Warrant pursuant to this
paragraph shall have any effect on the applicability of the provisions of this paragraph
with respect to any subsequent determination of exercisability. For the purposes of this
paragraph, beneficial ownership and all determinations and calculations (including,
without limitation, with respect to calculations of percentage ownership) shall be
determined by the Holder in accordance with Section 13(d) of the Securities Exchange Act
of 1934, as amended, and the rules and regulations promulgated thereunder. This paragraph
(or any portion hereof) shall be automatically corrected to the extent it is defective or
inconsistent with the intended Maximum Percentage beneficial ownership limitation herein
contained and changes or supplements shall be automatically made as are necessary to
properly give effect to such Maximum Percentage limitation, provided that the Company
shall have no obligation to verify or confirm the accuracy of any determination of
satisfying the Maximum Percentage limitation and shall have no liability with respect to
this Section&nbsp;11. The limitations contained in this paragraph shall apply to a
successor Holder of this Warrant. Each delivery of an Exercise Notice hereunder will
constitute a representation by the Holder that it has evaluated the limitation set forth
in this paragraph and determined that issuance of the full number of Warrant Shares
requested in such Exercise Notice is permitted under this paragraph, and the Company shall
have no obligation to verify or confirm the accuracy of such determination and shall have
no liability with respect to this Section&nbsp;11. This paragraph may not be amended or
waived by the Holder or the Company. </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;12. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Fractional
Shares</u>. The Company shall not be required to issue or cause to           be issued
fractional Warrant Shares or scrip representing fractional shares on           the
exercise of this Warrant. If any fraction of a Warrant Share would, except           for
the provisions of this Section, be issuable upon exercise of this Warrant,           the
number of Warrant Shares to be issued will be rounded down to the nearest           whole
share.  </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;13. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Notices</u>.
Any and all notices or other communications or deliveries           hereunder (including
without limitation any Exercise Notice) shall be in writing           and shall be deemed
given and effective on the earliest of (i)&nbsp;the date of           transmission, if
such notice or communication is delivered via facsimile at the           facsimile number
specified in the Purchase Agreement prior to 5:00&nbsp;p.m.           (New York City
time) on a Business Day, (ii)&nbsp;the next Business Day after           the date of
transmission, if such notice or communication is delivered via           facsimile at the
facsimile number specified in the Purchase Agreement on a day           that is not a
Business Day or later than 5:00 p.m. (New York City time) on any           Business Day,
(iii)&nbsp;the second Business Day following the date of delivery           to the
courier service, if sent by a U.S. or Israeli nationally recognized           overnight
courier service, or (iv)&nbsp;upon actual receipt by the party to whom           such
notice is required to be given. The address for such notices or           communications
shall be as set forth in the Purchase Agreement.  </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;14. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Warrant
Agent</u>. The Company shall serve as warrant agent under this           Warrant. Upon
thirty (30) days&#146; notice to the Holder, the Company may           appoint a new
warrant agent. Any corporation into which the Company or any new           warrant agent
may be merged or any corporation resulting from any consolidation           to which the
Company or any new warrant agent shall be a party or any           corporation to which
the Company or any new warrant agent transfers           substantially all of its
corporate trust or stockholder services business shall           be a successor warrant
agent under this Warrant without any further act. Any           such successor warrant
agent shall promptly cause notice of its succession as           warrant agent to be
mailed (by first class mail, postage prepaid) to the Holder           at the Holder&#146;s
last address as shown on the Warrant Register.  </font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;15. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Restrictions</u>.
The Holder acknowledges that the Warrant Shares acquired           upon the exercise of
this Warrant, if not registered, will have restrictions           upon resale imposed by
state and U.S. federal and Israeli securities laws.  </font></p>

<!-- MARKER FORMAT-SHEET="Para (List) Indent Lv 0- TNR" FSL="Workstation" -->
<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;16. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Miscellaneous</u>.  </font></p>

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<Table Width=100% Cellpadding=0 Cellspacing=0>
<tr Valign=TOP>
<td Align=RIGHT Width=5%></td>
<td Width=95%><P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;(a) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Subject
to the restrictions on transfer set forth on the first page hereof and
          applicable securities laws, this Warrant and the rights and obligations
          evidenced hereby shall inure to the benefit of and be binding upon the
          successors of the Company and the successors and permitted assigns of the
Holder           as set forth in the Purchase Agreement, provided that this Warrant may
be           assigned by the Company to a successor in the event of a Fundamental
          Transaction. Subject to the preceding sentence, nothing in this Warrant shall
be           construed to give to any Person other than the Company and the Holder any
legal           or equitable right, remedy or cause of action under this Warrant. This
Warrant           may be amended only in writing signed by the Company and the Holder and
their           successors and assigns.  </font></p></td>
</tr>
</table>
<br>

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<Table Width=100% Cellpadding=0 Cellspacing=0>
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<td Align=RIGHT Width=5%></td>
<td Width=95%><P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;(b) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company will not, by amendment of its governing documents or through any
          reorganization, transfer of assets, consolidation, merger, dissolution, issue
or           sale of securities or any other voluntary action, avoid or seek to avoid the
          observance or performance of any of the terms of this Warrant, but will at all
          times in good faith assist in the carrying out of all such terms and in the
          taking of all such action as may be necessary or appropriate in order to
protect           the rights of the Holder against impairment. Without limiting the
generality of           the foregoing, the Company (i)&nbsp;will not increase the par
value of any           Warrant Shares above the amount payable therefor on such exercise,
          (ii)&nbsp;will take all such action as may be reasonably necessary or
          appropriate in order that the Company may validly and legally issue fully paid
          and nonassessable Warrant Shares on the exercise of this Warrant, and
          (iii)&nbsp;will not close its stockholder books or records in any manner which
          interferes with the timely exercise of this Warrant.  </font></p></td>
</tr>
</table>
<br>

<p align=center>
<font size=2>- 10 -</font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>

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<Table Width=100% Cellpadding=0 Cellspacing=0>
<tr Valign=TOP>
<td Align=RIGHT Width=5%></td>
<td Width=95%><P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;(c) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>GOVERNING
LAW; VENUE; WAIVER OF JURY TRIAL</u>. ALL QUESTIONS CONCERNING THE
          CONSTRUCTION, VALIDITY, ENFORCEMENT AND INTERPRETATION OF THIS WARRANT SHALL BE
          GOVERNED BY AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE
          OF NEW YORK. EACH PARTY HEREBY IRREVOCABLY SUBMITS TO THE EXCLUSIVE
JURISDICTION           OF THE STATE AND FEDERAL COURTS SITTING IN THE CITY OF NEW YORK,
BOROUGH OF           MANHATTAN, FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN
CONNECTION           HEREWITH OR WITH ANY TRANSACTION CONTEMPLATED HEREBY OR DISCUSSED
HEREIN           (INCLUDING WITH RESPECT TO THE ENFORCEMENT OF ANY OF THE TRANSACTION
DOCUMENTS),           AND HEREBY IRREVOCABLY WAIVES, AND AGREES NOT TO ASSERT IN ANY
SUIT, ACTION OR           PROCEEDING, ANY CLAIM THAT IT IS NOT PERSONALLY SUBJECT TO THE
JURISDICTION OF           ANY SUCH COURT AND THAT SUCH SUIT, ACTION OR PROCEEDING IS
IMPROPER. EACH PARTY           HEREBY IRREVOCABLY WAIVES PERSONAL SERVICE OF PROCESS AND
CONSENTS TO PROCESS           BEING SERVED IN ANY SUCH SUIT, ACTION OR PROCEEDING BY
MAILING A COPY THEREOF           VIA REGISTERED OR CERTIFIED MAIL OR OVERNIGHT DELIVERY
(WITH EVIDENCE OF           DELIVERY) TO SUCH PARTY AT THE ADDRESS IN EFFECT FOR NOTICES
TO IT UNDER THIS           AGREEMENT AND AGREES THAT SUCH SERVICE SHALL CONSTITUTE GOOD
AND SUFFICIENT           SERVICE OF PROCESS AND NOTICE THEREOF. NOTHING CONTAINED HEREIN
SHALL BE DEEMED           TO LIMIT IN ANY WAY ANY RIGHT TO SERVE PROCESS IN ANY MANNER
PERMITTED BY LAW.           EACH OF THE COMPANY AND THE HOLDER HEREBY WAIVES ALL RIGHTS
TO A TRIAL BY JURY.  </font></p></td>
</tr>
</table>
<br>




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<Table Width=100% Cellpadding=0 Cellspacing=0>
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<td Align=RIGHT Width=5%></td>
<td Width=95%><P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;(d) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
headings herein are for convenience only, do not constitute a part of this
          Warrant and shall not be deemed to limit or affect any of the provisions
hereof.  </font></p></td>
</tr>
</table>
<br>

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<Table Width=100% Cellpadding=0 Cellspacing=0>
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<td Align=RIGHT Width=5%></td>
<td Width=95%><P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;(e) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
case any one or more of the provisions of this Warrant shall be invalid or
          unenforceable in any respect, the validity and enforceability of the remaining
          terms and provisions of this Warrant shall not in any way be affected or
          impaired thereby and the parties will attempt in good faith to agree upon a
          valid and enforceable provision which shall be a commercially reasonable
          substitute therefor, and upon so agreeing, shall incorporate such substitute
          provision in this Warrant.  </font></p></td>
</tr>
</table>
<br>

<P align=center><FONT FACE="Times New Roman, Times, Serif" SIZE=2>[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK,
<Br>SIGNATURE PAGE FOLLOWS]
</FONT></P>

<p align=center>
<font size=2>- 11 -</font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>


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<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;IN
WITNESS WHEREOF, the Company has caused this Warrant to be duly executed by its authorized
officer as of the date first indicated above. </font></p>


<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
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<TR VALIGN=Bottom>
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     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
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<TR VALIGN=Bottom>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
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<TR VALIGN=Bottom>
     <TH WIDTH=50%><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH WIDTH=5% ><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH WIDTH=45%><FONT FACE="Times New Roman" SIZE=1></FONT></TH></TR>
<TR VALIGN=Bottom>
     <TD  ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT colspan=2><FONT FACE="Times New Roman" SIZE=2>SILICOM LTD.</FONT></TD>
</TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>By:</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>_________________________</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Name:</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>_________________________</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Title:</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>_________________________</FONT></TD></TR>
</TABLE>
<Br>

<p align=center>
<font size=2>- 12 -</font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>



<!-- MARKER FORMAT-SHEET="Head Minor Center-TNR" FSL="Workstation" -->
<P Align=CENTER><Font Face="Times New Roman, Times, Serif" Size=2>FORM OF EXERCISE NOTICE </font></p>

<!-- MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation" -->
<P><Font Face="Times New Roman, Times, Serif" Size=2>(To be executed by the Holder to
exercise the right to purchase Ordinary Shares under the foregoing Warrant) </font></p>

<!-- MARKER FORMAT-SHEET="Head Left-TNR" FSL="Default" -->
<P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>To: SILICOM LTD. </font></p>

<!-- MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation" -->
<P><Font Face="Times New Roman, Times, Serif" Size=2>The  undersigned  is the  Holder of
 Warrant  No.  _______  (the  "<B>Warrant</b>")  issued by  SILICOM  LTD.,  an Israeli
corporation  (the  "<B>Company</b>").  Capitalized  terms  used  herein  and not  otherwise
 defined  have the  respective meanings set forth in the Warrant. </font></p>

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     <Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
          <Tr Valign=TOP>
          <Td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>1.</font></td>
          <Td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>
          The Warrant is currently exercisable to purchase a total of ______________
          Warrant Shares. </font></td>
          </tr>
          </table>
          <Br>

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     <Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
          <Tr Valign=TOP>
          <Td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>2.</font></td>
          <Td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>
          The undersigned Holder hereby exercises its right to purchase _________________
          Warrant Shares pursuant to the Warrant. </font></td>
          </tr>
          </table>
          <Br>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Lv 0-TNR" FSL="Default" -->
     <Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
          <Tr Valign=TOP>
          <Td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>3.</font></td>
          <Td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>
          The Holder intends that payment of the Exercise Price shall be made as (check
          one): </font></td>
          </tr>
          </table>
          <Br>


<!-- MARKER FORMAT-SHEET="Para Hang Lv 2-TNR" FSL="Workstation" -->
<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=10%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>                  ____ </font></td>
<td Width=85%><Font Face="Times New Roman, Times, Serif" Size=2>"Cash
Exercise" under Section 10 </font></td>
</tr>
</table>
<br>

<!-- MARKER FORMAT-SHEET="Para Hang Lv 2-TNR" FSL="Workstation" -->
<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=10%><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;</font></td>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>                  ____ </font></td>
<td Width=85%><Font Face="Times New Roman, Times, Serif" Size=2>"Cashless
Exercise" under Section 10 </font></td>
</tr>
</table>
<br>


<!-- MARKER FORMAT-SHEET="Para (List) Hang Lv 0-TNR" FSL="Workstation" -->
     <Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
          <Tr Valign=TOP>
          <Td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>4.</font></td>
          <Td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>
          If the holder has elected a Cash Exercise, the holder shall pay the sum of
          $____________ to the Company in accordance with the terms of the Warrant. </font></td>
          </tr>
          </table>
          <Br>

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     <Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
          <Tr Valign=TOP>
          <Td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>5.</font></td>
          <Td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>
          Pursuant to this exercise, the Company shall deliver to the holder
          _______________ Warrant Shares in accordance with the terms of the Warrant. </font></td>
          </tr>
          </table>
          <Br>

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     <Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
          <Tr Valign=TOP>
          <Td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>6.</font></td>
          <Td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>
          Following this exercise, the Warrant shall be exercisable to purchase a total of
          ______________ Warrant Shares. </font></td>
          </tr>
          </table>
          <Br>

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     <Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
          <Tr Valign=TOP>
          <Td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>7.</font></td>
          <Td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>
          Please issue a certificate or certificates representing said Warrant Shares in
          the name of the undersigned or in the name of _____________. </font></td>
          </tr>
          </table>
          <Br>

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     <Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
          <Tr Valign=TOP>
          <Td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>8.</font></td>
          <Td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>
          The Warrant Shares shall be delivered to the following DWAC Account Number or by
          physical delivery of a certificate to: _________________________. </font></td>
          </tr>
          </table>
          <Br>

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     <Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
          <Tr Valign=TOP>
          <Td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>9.</font></td>
          <Td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>
          The undersigned is an &#147;accredited investor&#148; as defined in Regulation D
          promulgated under the Securities Act of 1933, as amended. </font></td>
          </tr>
          </table>
          <Br>

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     <Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
          <Tr Valign=TOP>
          <Td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>10.</font></td>
          <Td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>
          In exercising this Warrant, the undersigned hereby confirms and acknowledges
          that the Warrant Shares are being acquired solely for the account of the
          undersigned and not as a nominee for any other party, or for investment, and
          that the undersigned will not offer, sell or otherwise dispose of any such
          Warrant Shares except under circumstances that will not result in a violation of
          the Securities Act of 1933, as amended, or any state securities laws. </font></td>
          </tr>
          </table>
          <Br>

<p align=center>
<font size=2>- 13 -</font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>



<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH></TR>
<TR VALIGN=Bottom>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
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<TR VALIGN=Bottom>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
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<TR VALIGN=Bottom>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
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<TR VALIGN=Bottom>
     <TH WIDTH=40%><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH WIDTH=5% ><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH WIDTH=55%><FONT FACE="Times New Roman" SIZE=1></FONT></TH></TR>
<TR VALIGN=Bottom>
     <TD  ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Dated:  ____________________, ______</FONT></TD>
     <TD ALIGN=LEFT colspan=2><FONT FACE="Times New Roman" SIZE=2>Name of Holder:</FONT></TD>
</TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>(Print)</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>__________________________________________________________</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>By:</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>__________________________________________________________</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Name:</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>__________________________________________________________</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Title:</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>__________________________________________________________</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>(Signature must conform in all respects to name of holder<Br>as specified on the face of the Warrant)</FONT></TD></TR>
</TABLE>
<Br>

<p align=center>
<font size=2>- 14 -</font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>


<!-- MARKER FORMAT-SHEET="Head Minor Center-TNR" FSL="Workstation" -->
<P Align=CENTER><Font Face="Times New Roman, Times, Serif" Size=2>FORM OF ASSIGNMENT </font></p>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P Align="Center"><Font Face="Times New Roman, Times, Serif" Size=2>[To be completed and signed only upon transfer of Warrant] </font></p>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Default" -->
<P><Font Face="Times New Roman, Times, Serif" Size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;FOR
VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto
________________________________ the right represented by the within Warrant to purchase
____________ Ordinary Shares of SILICOM LTD. to which the within Warrant relates and
appoints ________________ attorney to transfer said right on the books of SILICOM LTD.
with full power of substitution in the premises. </font></p>


<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Dated:  ____________________, ______</FONT></P>

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<TR VALIGN=Bottom>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH></TR>
<TR VALIGN=Bottom>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH></TR>
<TR VALIGN=Bottom>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH></TR>
<TR VALIGN=Bottom>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH></TR>
<TR VALIGN=Bottom>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=50% ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=50% ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>(Signature must conform in all respects to name of</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>holder as specified on the face of the Warrant)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>_________________________________________________</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Address of Transferee</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>_________________________________________________</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>_________________________________________________</FONT></TD></TR>
</TABLE>
<Br>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>In the presence of: </font></p>

<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>_________________________________________________</FONT></P>

<p align=center>
<font size=2>- 15 - </font></p>
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<DOCUMENT>
<TYPE>EX-99
<SEQUENCE>6
<FILENAME>exhibit_99-5.htm
<TEXT>
<HTML>
<HEAD>
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     <!-- Project:        \\Backup\office\EDGAR Filing\Silicom Ltd\73702\a73702.eep        -->
     <!-- Control Number: 73702                                                            -->
     <!-- Rev Number:     1                                                                -->
     <!-- Client Name:    Silicom Ltd                                                      -->
     <!-- Project Name:   6-K                                                              -->
     <!-- Firm Name:      Zadok-Keinan Ltd                                                 -->
     <TITLE>6-K</TITLE>
</HEAD>
<BODY>

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<P Align="Right"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><U><B>Exhibit 99.5</B></U> </FONT> </P>

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<H1 Align=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><U>Disclosure Schedules to the</U> </FONT><Br>
<FONT FACE="Times New Roman, Times, Serif" SIZE="2"><u>Securities Purchase Agreement</u> </FONT> </h1>

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<H1 Align=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><B>General Terms</B> </FONT></h1>

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<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>1. </font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>Any
terms used in this Disclosure Schedule but not defined herein shall have the
          same meanings ascribed thereto in the Securities Purchase Agreement by and
among           Silicom Ltd. (the &#147;Company&#148;) and the Investors (as defined
therein),           dated May 3, 2007 (the &#147;Agreement&#148;). </font></td>
</tr>
</table>
<br>

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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>2. </font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>This
Disclosure Schedule is qualified in its entirety by reference to the           specific
provisions of the Agreement, and is not intended to constitute, and           shall not
be construed as constituting, representations and warranties of the           Company,
except as and to the extent provided in the Agreement. Inclusion of           information
herein shall not be construed as an admission that such information           is material
to the businesses of the Company, or give rise to circumstances           which may
result in a Material Adverse Effect on the Company, or that such           information
reflects facts or circumstances that are outside of the ordinary           course of
business. </font></td>
</tr>
</table>
<br>

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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>3. </font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>The
section numbers in this Disclosure Schedule correspond to the section           numbers
in the Agreement; however, any information disclosed herein under any           section
number shall be deemed to be disclosed and incorporated into any other           section
number under the Agreement where such disclosure would be appropriate.           The
headings contained in this Disclosure Schedule are for reference purposes           only
and shall not affect in any way the meaning or interpretation of this
          Disclosure Schedule. </font></td>
</tr>
</table>
<br>

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<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2>4. </font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>Where
the terms of a contract or other disclosure item have been summarized or
          described in this Disclosure Schedule, such summary or description does not
          purport to be a complete statement of the material terms of such contract or
          other item. </font></td>
</tr>
</table>
<br>

<p align=center>
<font size=2></font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>


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<H1 Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2><b>Schedule 3.1(a)
&#150; Subsidiaries</b> </font></h1>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>The Company&#146;s sole subsidiary, which
is wholly-owned by the Company, is Silicom Connectivity Solutions, Inc. </font></p>

<!-- MARKER FORMAT-SHEET="Head Major Left Bold-TNR" FSL="Workstation" -->
<H1 Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2><b>Schedule 3.1(d)
&#150; No Conflicts</b> </font></h1>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>The Company has filed a routine
request for the listing of the shares issuable to the Investors with the Tel Aviv Stock
Exchange and expects to receive the approval therefor on or about the Closing Date.</font></p>

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<P><Font Face="Times New Roman, Times, Serif" Size=2>The issuance of the securities
contemplated by the Agreement requires the approval of the Israeli Office of the Chief
Scientist (the &#147;OCS&#148;). The Company has submitted a routine request with the OCS
for the approval thereof. If an Investor shall be required to provide the undertakings to
the OCS as contemplated by Section 4.7 of the Agreement, the Company will provide notice
of the issuance of the securities to the OCS and deliver the executed undertakings to the
OCS<I>.</i> </font></p>

<!-- MARKER FORMAT-SHEET="Head Major Left Bold-TNR" FSL="Workstation" -->
<H1 Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>Schedule 3.1(f)
&#150; Capitalization</font></h1>

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<p Align=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><U><B>Capital Structure and
Ownership<BR>As of April 30, 2007</B></U> </FONT> <Br><Br>
<FONT FACE="Times New Roman, Times, Serif" SIZE="2"><U><B>Authorized<Br>Shares</B></U> </FONT> <Br>
<FONT FACE="Times New Roman, Times, Serif" SIZE="2">10,000,000 </FONT> </p>



<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <TH COLSPAN=9><FONT FACE="Times New Roman" SIZE=1>Outstanding Shares</FONT><HR WIDTH=98% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=6><FONT FACE="Times New Roman" SIZE=1>Options</FONT><HR WIDTH=98% SIZE=1 COLOR=BLACK NOSHADE></TH>
</TR>
<TR VALIGN=Bottom>
     <TH COLSPAN=3><FONT FACE="Times New Roman" SIZE=1>&nbsp;</FONT></TH>
     <TH COLSPAN=3><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH COLSPAN=3><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH COLSPAN=3><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH COLSPAN=3><FONT FACE="Times New Roman" SIZE=1></FONT></TH></TR>
<TR VALIGN=Bottom>
     <TH COLSPAN=3><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH COLSPAN=3><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH COLSPAN=3><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH COLSPAN=3><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH COLSPAN=3><FONT FACE="Times New Roman" SIZE=1></FONT></TH></TR>
<TR VALIGN=Bottom>
     <TH COLSPAN=3><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH COLSPAN=3><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH COLSPAN=3><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH COLSPAN=3><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH COLSPAN=3><FONT FACE="Times New Roman" SIZE=1></FONT></TH></TR>
<TR VALIGN=Bottom>
     <TH COLSPAN=3><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH COLSPAN=3><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH COLSPAN=3><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH COLSPAN=3><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH COLSPAN=3><FONT FACE="Times New Roman" SIZE=1></FONT></TH></TR>
<Tr Valign="Bottom" Bgcolor="#CCEEFF">
     <Td Width="27%" Align="LEFT"><FONT FACE="Times New Roman" SIZE=2>Avi Eizenman</FONT></TD>
     <Td Width="1%" Align="LEFT"><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <Td Width="2%" Align="LEFT"><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <Td Width="1%" Align="CENTER"><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <Td Width="2%" Align="LEFT"><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <Td Width="3%" Align="LEFT"><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <Td Width="1%" Align="RIGHT"><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD><Td Width="10%" Align="RIGHT"><FONT FACE="Times New Roman" SIZE=2>108,315</FONT></TD>
        <Td Width="3%" Align="LEFT"><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <Td Width="40%" Align="LEFT"><FONT FACE="Times New Roman" SIZE=2>Employees and D&amp;O</FONT></TD>
     <Td Width="1%" Align="LEFT"><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <Td Width="2%" Align="LEFT"><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <Td Width="1%" Align="RIGHT"><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD><Td Width="10%" Align="RIGHT"><FONT FACE="Times New Roman" SIZE=2>296,550</FONT></TD>
        <Td Width="2%" Align="LEFT"><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Yehuda Zisapel</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=CENTER><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>618,940</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Warrants (Series 1) (traded on the TASE)</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>167,441</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD></TR>
<TR>
     <TD COLSPAN=3></TD>
     <TD COLSPAN=2 ALIGN=RIGHT></TD><TD></TD>
     <TD COLSPAN=2 ALIGN=RIGHT></TD><TD></TD>
     <TD COLSPAN=2 ALIGN=RIGHT></TD><TD></TD>
     <TD COLSPAN=2 ALIGN=RIGHT><HR NOSHADE COLOR=#808080 SIZE=1></TD><TD></TD></TR>
<Tr Valign="Bottom" Bgcolor="#CCEEFF">
     <Td Align="LEFT"><FONT FACE="Times New Roman" SIZE=2>Zohar Zisapel</FONT></TD><Td Align="LEFT"><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD><Td Align="LEFT"><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <Td Align="CENTER"><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD><Td Align="LEFT"><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD><Td Align="LEFT"><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <Td Align="RIGHT"><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD><Td Align="RIGHT"><FONT FACE="Times New Roman" SIZE=2>673,723</FONT></TD>
        <Td Align="LEFT"><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <Td Align="LEFT"><FONT FACE="Times New Roman" SIZE="2"><B>Total</B> </FONT></TD><Td Align="LEFT"><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD><Td Align="LEFT"><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <Td Align="RIGHT"><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD><Td Align="RIGHT"><FONT FACE="Times New Roman" SIZE="2"><B>463,991</B> </FONT></TD>
        <Td Align="LEFT"><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Robert Sussman</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=CENTER><FONT FACE="Times New Roman" SIZE=2></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2><Sup>[1]</sup></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>644,200</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD></TR>
<Tr Valign="Bottom" Bgcolor="#CCEEFF">
     <Td Align="LEFT"><FONT FACE="Times New Roman" SIZE=2>Bjurman, Barry &amp; Associates</FONT></TD><Td Align="LEFT"><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD><Td Align="LEFT"><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <Td Align="CENTER"><FONT FACE="Times New Roman" SIZE=2></FONT></TD><Td Align="LEFT"><FONT FACE="Times New Roman" SIZE=2><Sup>[2]</sup></FONT></TD><Td Align="LEFT"><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <Td Align="RIGHT"><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD><Td Align="RIGHT"><FONT FACE="Times New Roman" SIZE=2>340,300</FONT></TD>
        <Td Align="LEFT"><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <Td Align="LEFT"><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD><Td Align="LEFT"><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD><Td Align="LEFT"><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <Td Align="RIGHT"><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD><Td Align="RIGHT"><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
        <Td Align="LEFT"><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>other</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=CENTER><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>3,142,081</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD></TR>
<TR>
     <TD COLSPAN=3></TD>
     <TD COLSPAN=2 ALIGN=RIGHT></TD><TD></TD>
     <TD COLSPAN=2 ALIGN=RIGHT><HR NOSHADE COLOR=#808080 SIZE=1></TD><TD></TD>
     <TD COLSPAN=2 ALIGN=RIGHT></TD><TD></TD>
     <TD COLSPAN=2 ALIGN=RIGHT></TD><TD></TD></TR>
<Tr Valign="Bottom" Bgcolor="#CCEEFF">
     <Td Align="LEFT"><FONT FACE="Times New Roman" SIZE="2"><B>Total</B> </FONT></TD><Td Align="LEFT"><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD><Td Align="LEFT"><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <Td Align="CENTER"><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD><Td Align="LEFT"><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD><Td Align="LEFT"><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <Td Align="RIGHT"><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD><Td Align="RIGHT"><FONT FACE="Times New Roman" SIZE="2"><B>5,527,559</B> </FONT></TD>
        <Td Align="LEFT"><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <Td Align="LEFT"><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD><Td Align="LEFT"><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD><Td Align="LEFT"><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <Td Align="RIGHT"><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD><Td Align="RIGHT"><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
        <Td Align="LEFT"><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD></TR>
</TABLE>
<Br>



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<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2><Sup>[1]</sup> </font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>          Based
on Form 4/A filed on April 30, 2007. </font></td>
</tr>
</table>


<!-- MARKER FORMAT-SHEET="Para Hang Lv 0-TNR" FSL="Workstation" -->
<Table Width=100% Cellpadding=0 Cellspacing=0 Border=0>
<tr Valign=TOP>
<td Width=5%><Font Face="Times New Roman, Times, Serif" Size=2><Sup>[2]</sup> </font></td>
<td Width=95%><Font Face="Times New Roman, Times, Serif" Size=2>           Based
on Schedule 13G/A filed on December 27, 2006. </font></td>
</tr>
</table>
<br>

<p align=center>
<font size=2></font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<P STYLE="page-break-after:always"></P>


<!-- MARKER FORMAT-SHEET="Head Major Left Bold-TNR" FSL="Workstation" -->
<H1 Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>Schedule 3.1(i)
&#150; Absence of Litigation </font></h1>

<!-- MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation" -->
<P><Font Face="Times New Roman, Times, Serif" Size=2>On or about May 2, 2007, the Company
received a letter alleging violations of Section 16(b) of the Exchange Act of 1934 by a
shareholder of the Company (who does not serve as a director or officer of, and is not
employed by, the Company or its Subsidiary) requesting that the Company investigate such
allegations and take actions for the recovery of profits pursuant to said section. Section
16 of the Exchange Act of 1934 does not apply to the Company by virtue of Rule 3a12-3
promulgated under the Exchange Act and therefore no violation could have occurred
thereunder. </font></p>

<!-- MARKER FORMAT-SHEET="Head Major Left Bold-TNR" FSL="Workstation" -->
<H1 Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>Schedule 3.1(gg)
&#150; Office of the Chief Scientist </font></h1>

<!-- MARKER FORMAT-SHEET="Head Left-TNR" FSL="Default" -->
<P Align=LEFT><Font Face="Times New Roman, Times, Serif" Size=2>See Schedule 3.1(d). </font></p>

<p align=center>
<font size=2></font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px">
<HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
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