AGREEMENT AND PLAN OF MERGER

THIS AGREEMENT AND PLAN OF MERGER (this Agreement) is dated as of March     , 2007 by and among Bernard Leff (Non-Management Stockholder #1), Jank Partners LLC (Non-Management Stockholder #2), and Amerimedical Holdings, Inc. (Non-Management Stockholder #3, and collectively with Non-Management Stockholder #1 and Non-Management Stockholder #2, are the Non-Management Stockholders), Marc Waldman (Management Stockholder #1), William Tobin (Management Stockholder #2), Joseph Anastasio (Management Stockholder #3) and Jeanne Wilde (Management Stockholder #4, and collectively with Management Stockholder #1, Management Stockholder #2 and Management Stockholder #3, are the Management Stockholders, which collectively with the Non-Management Stockholders, are the Stockholders), Marc Waldman, as agent for the Stockholders (the Stockholders Representative and the Exchange Agent), Ortho-Medical Products Inc., a New York corporation (the Corporation), Andover Management Services, Inc., a New York corporation (the Buyer), and Andover Medical, Inc., a Delaware corporation and the sole stockholder of the Buyer (the Guarantor).

W I T N E S S E T H:

WHEREAS, the Corporation is in the business of distributing orthopedic durable medical equipment, orthotics and prosthetics and respiratory equipment (the Business);

WHEREAS, the Stockholders collectively own, directly or indirectly, 100% of the issued and outstanding shares of common stock, without par value (the Stock), of the Corporation;

WHEREAS, the Boards of Directors of the Buyer and the Guarantor have determined that the Merger (defined below) is consistent with and in furtherance of its long-term business strategy and fair to, and in the best interest of the Buyer, the Guarantor and their respective stockholders;

WHEREAS, the Board of Directors of the Corporation has determined that the Merger is consistent with and in furtherance of its long-term business strategy and fair to, and in the best interest of the Corporation and its Stockholders;

WHEREAS, the Board of Directors of each of the Guarantor (on its own behalf and as the sole stockholder of Buyer), Buyer and the Corporation have each adopted resolutions approving this Agreement and the merger of the Buyer with and into the Corporation (the Merger), resulting in the cancellation of all of the stock of the Buyer and with the Corporation continuing as the surviving corporation in the Merger in

accordance with the New York Business Corporation Law (NYBCL) and, in each such case, upon the terms and conditions set forth in this Agreement;

WHEREAS, each outstanding share of the Stock shall be exchanged for Merger Consideration (as defined herein); and

WHEREAS, for U.S. federal income tax purposes, it is intended that the Merger shall constitute a reorganization within the meaning of Section 368(a)(1)(A) and (a)(2)(E) of the Internal Revenue Code of 1986, as amended (the Code), and that this Agreement shall constitute a plan of reorganization within the meaning of Section 368(b) of the Code.

NOW THEREFORE, in consideration of the mutual covenants of the parties as hereinafter set forth and other good and valuable consideration, the receipt and sufficiency of which hereby are acknowledged, the parties hereto hereby agree as follows:

Section 1. Merger Transaction.

(a)           The Merger.  Upon the terms and subject to the conditions of this Agreement, the Merger shall be consummated in accordance with the NYBCL.  At the Effective Time, upon the terms and subject to the conditions of this Agreement, Buyer shall be merged with and into the Corporation in accordance with the NYBCL and the separate existence of Buyer shall thereupon cease and the Corporation, as the surviving corporation in the Merger (the Surviving Corporation), shall continue its corporate existence under the laws of New York as a wholly-owned subsidiary of Guarantor.

(b)           Closing; Effective Time.

(i)            The closing of the Merger (the Closing) shall take place at the offices of Phillips Nizer LLP, 666 Fifth Avenue, New York, New York 10103-0084, or at such other location as may be agreed to by the parties, at 10:00 A.M. within twenty (20) days of Buyers receipt and acceptance of the Additional Financial Statements under Sections 4(b)(vii) and 8(g) hereof or at such other date (the Closing Date), but not later than April 15, 2007.  The deliveries to be made by each of the parties at the Closing are specified in Sections 12 and 13 below.

(ii)           Subject to the provisions of this Agreement, at the Closing, the parties shall file with the Secretary of State of New York a certificate of merger (the Certificate of Merger) in accordance with Article 9 of the NYBCL executed in accordance with the relevant provisions of the NYBCL and shall make all other filings or recordings required under such law in order to effect the Merger.  The Merger shall become effective for all purposes as of the close of the Closing Date (the Effective Date).

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(c)           Succession.  At the Effective Time, the Buyer shall succeed to all of the rights, privileges, debts, liabilities, powers, property and contract rights of the Corporation in the manner of and as more fully set forth in the NYBCL.

(d)           Conversion of Securities.  At the Effective Time, by virtue of the Merger and without any action on the part of the holders of any securities of the Corporation, the Buyer or the Guarantor:

(i)            All of the issued and outstanding shares of Stock shall automatically be converted and exchanged for the right to receive from Guarantor Two Million Five Hundred Thousand Dollars ($2,500,000.00), (i) with twenty percent (20%), or $500,000, being paid in cash (the Cash Consideration), and (ii) eighty percent (80%) being paid in shares of common stock of Guarantor (the Stock Consideration, and together with the Cash Consideration, the Merger Consideration), but subject to adjustment pursuant to Section 1(g).  For purposes of determining the number of shares of Stock Consideration to be issued to a Stockholder, (a) a share of common stock of Guarantor shall be valued at the average of the closing price of such stock on each of the last ten (10) trading days immediately prior to the Closing Date (the Fair Market Value) and (b) any fractional shares issuable to a Stockholder shall be rounded up to the next whole share.

(ii)           Notwithstanding the foregoing, if the number of shares of Common Stock of Guarantor comprising the Stock Consideration would exceed 3,000,000 Shares, the Buyer shall have the right under Section 11(d) herein to terminate this Agreement, and if they would be less then 2,850,000 shares, the Stockholders Representative shall have the right under Section 11(e) herein to terminate this Agreement.

(iii)          Subject to delivery of a portion of the Merger Consideration into escrow in accordance with the provisions of Section 1(f), at the Closing (A) the Stock Consideration shall be delivered to the Exchange Agent in trust for the Stockholders, pro rata in accordance with each Stockholders percentage ownership of Stock immediately before the Effective Time, as set forth on Schedule 1(d)(iii) (the Pro Rata Portions), upon their surrender, in the manner provided in Section 1(i)(ii) hereof, of the certificate or certificates which immediately prior to the Effective Time represents outstanding Stock (the Certificates); and (B) the Cash Consideration shall be paid directly to Loeb & Loeb LLP, attorneys to the Corporation, by wire transfer of immediately available funds from the Guarantor to an account specified in writing by Loeb & Loeb LLP.

(iv)          With respect to any payment required to be made by a Stockholder to the Guarantor pursuant to Section 1(g) herein, unless otherwise provided for in Section 1(g), not more than twenty percent (20%) of such payment must be made in cash and not less than eighty percent (80%) of such payment may be made in shares of the Guarantor received as part of the Merger Consideration, which shares shall be valued at the average of the closing price of such stock on each of the past ten (10) trading days immediately prior to the payment.

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(e)           Treasury Stock.  All Stock owned as treasury stock, if any, shall be cancelled and retired by the Corporation without payment of any consideration therefor and shall cease to exist.

(f)            Delivery of Portion of Merger Consideration into Escrow.  At the Closing, Guarantor shall withhold from the Cash Consideration, Seventy-Five Thousand ($75,000) Dollars (the Cash Escrow Amount) and shall deposit the Cash Escrow Amount in escrow with Phillips Nizer LLP as escrow agent (the Escrow Agent).  At the Closing, the Exchange Agent shall deposit a number of shares equal to ten percent (10%) of the Stock Consideration received by the Stockholders (with fractional shares being rounded down to the next lower whole number of shares), together with stock powers therefor endorsed in blank, in escrow with the Escrow Agent (the Stock Escrow Amount, and together with the Cash Escrow Amount, as adjusted pursuant to the Escrow Agreement, is the Escrow Collateral).  The Escrow Collateral shall be held in escrow by the Escrow Agent pursuant to, and released from escrow in accordance with, the provisions of this Agreement and the escrow agreement to be entered into at the Closing by and among Guarantor, the Stockholders, the Stockholders Representative and the Escrow Agent, substantially in the form attached hereto as Exhibit A (the Escrow Agreement).  The Escrow Collateral is held by the Escrow Agent as security against the payment and performance of the Stockholders obligations with respect to (i) reductions in the Merger Consideration pursuant to Section 1(g), subject to the limitations on each Stockholders individual liability set forth in Section 1(g), and (ii) the indemnification provisions of Section 6(b).

(g)           Adjustments to Merger Consideration.

(i)            The parties hereto agree that the Merger shall be accounted for on the close of business on the Closing Date.  The Stockholders Representative agrees to consult with Buyer on any material issues, events, conditions or contract relating to the Corporation prior to the Closing.  An adjustment to the Merger Consideration (the Adjusted Merger Consideration) shall be calculated and agreed to by both the Stockholders Representative and the Buyer which shall adjust the Merger Consideration, as determined pursuant to this Section 1(g).  The Merger Consideration is based upon the Corporation reporting: (A) accounts receivable of at least $900,000 and inventory and fixed assets of at least $200,000 as of the close of business on the Closing Date; and (B) net revenues of at least $3,000,000 and net income of at least $70,000 for the year ended December 31, 2006 (the Fiscal 2006), subject to the provisions of subsection (iii) below.

(ii)           The Stockholders Representative shall deliver to Buyer, within forty-five (45) days after the Closing Date, and submit for Buyers review, an unaudited balance sheet as of the close of business on the Closing Date (Closing Balance Sheet)  prepared in accordance with generally accepted accounting principles (GAAP), as historically and consistently applied by the Corporation and as used in preparation of the Additional Financial Statements (defined in Section 4(b)(vii)).  In addition, prior to Closing, the Stockholders shall have delivered to Buyer the Additional Financial

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Statements, among which shall be included an audited income statement for Fiscal 2006 (the 2006 Income Statement).

(iii)          If the 2006 Income Statement reflects net revenues of less than $2,850,000 (95% of $3,000,000 represented) and/or net income of less than $66,500 (95% of $70,000 represented) for Fiscal 2006 (in either case an Income Statement Shortfall), then the Cash Consideration shall be decreased by one dollar for each dollar of Income Statement Shortfall (the Income Statement Shortfall Adjustment).  If the Closing Balance Sheet reflects accounts receivable of less than $900,000 or inventory and fixed assets of less than $200,000 as of the Closing Date (in either case, a Balance Sheet Shortfall), then the Cash Consideration shall be decreased by one dollar for each dollar of Balance Sheet Shortfall (the Balance Sheet Shortfall Adjustment).

(iv)          Buyer shall have the right, for a period of forty-five (45) days from receipt of the Closing Balance Sheet to review same.  If the Buyer wishes to dispute the Closing Balance Sheet, then the Buyer shall, within such forty-five (45) day period, deliver notice of such dispute to the Stockholders Representative, which notice shall contain an explanation of the Buyers dispute with the Closing Balance Sheet.  If no such notice is received by Stockholders Representative within such forty-five (45) day period, then the Closing Balance Sheet shall be final and binding on the parties.  If such a notice is received by Stockholders Representative within such forty-five (45) day period, Buyer and Stockholders Representative shall attempt, for a period of forty-five (45) days after delivery of any such notice, to reach an agreement with respect to the Closing Balance Sheet, and if agreement is reached, then the Closing Balance Sheet as so adjusted and agreed shall be final and binding on the parties.  If the Stockholders Representative and the Buyer are unable to determine the matter by mutual agreement within such forty-five (45) day period, then both parties shall cause the disagreement to be submitted to binding arbitration as set forth in Section 19 herein to finally determine the Closing Balance Sheet, which as so determined shall be final and binding on the parties.  The 2006 Income Statement, in the form delivered to the Buyer prior to Closing, shall be final and binding on the parties and shall not be subject to challenge or dispute hereunder.  The Income Statement Shortfall Adjustment and the Balance Sheet Shortfall Adjustment shall be determined by the Guarantor and the Stockholders Representative from the 2006 Income Statement and the final Closing Balance Sheet within three (3) days after the Closing Balance Sheet become final, and such adjustments, if any, shall be paid by the Escrow Agent to the Buyer from the Cash Escrow Amount in accordance with the terms of the Escrow Agreement.  To the extent the amount payable exceeds the Cash Escrow Amount, each Stockholder shall be responsible solely for its Pro Rata Portion of any such refund from the Merger Consideration received by him or it pursuant to this Agreement.

(v)           In addition to the adjustment to the Cash Consideration set forth above, in this subsection, the Merger Consideration may also be reduced by way of a delivery to Buyer from the Escrow Collateral in the event that for the six (6) month period commencing the first full month after the Closing (the 2007 Income Statement), the Corporations net revenues as determined by the Corporations auditors are less than $1,350,000 (a 2007 Income Statement Shortfall) the Buyer shall be entitled to receive

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from the Escrow Collateral one dollar for each dollar of 2007 Income Statement Shortfall (2007 Income Statement Shortfall Adjustment).

(vi)          The Stockholders Representative shall have the right, for a period of forty-five (45) days from receipt of the 2007 Income Statement to review same.  If the Stockholders Representative wishes to dispute the 2007 Income Statement Shortfall Adjustment, then the Stockholders Representative shall, within such forty-five (45) day period, deliver notice of such dispute to the Guarantor, which notice shall contain an explanation of the Stockholders Representative dispute with the 2007 Income Statement Shortfall Adjustment.  If no such notice is received by Guarantor within such forty-five (45) day period, then the 2007 Income Statement Shortfall Adjustment shall be final and binding on the parities.  If such a notice is received by Guarantor within such forty-five (45) day period, the Guarantor and Stockholders Representative shall attempt, for a period of forty-five (45) days after delivery of any such notice, to reach an agreement with respect to the 2007 Income Statement Shortfall Adjustment, and if agreement is reached, then such 2007 Income Statement as so adjusted and agreed shall be final and binding on the parties.  If the Guarantor and the Stockholders Representative are unable to determine the matter by mutual agreement within such forty-five (45) day period, then both parties shall cause the disagreement to be submitted to binding arbitration as set forth in Section 19 herein to finally determine the 2007 Income Statement, which as so determined shall be final and binding on the parties.  The final 2007 Income Statement Shortfall Adjustment, if any, shall be paid by the Escrow Agent to the Buyer from the Escrow Collateral, in the following order: first, from the Cash Escrow Amount, and second, from the Stock Escrow Amount (with each share being valued at the average of the closing price of such stock on each of the last ten (10) trading days immediately prior to the payment date and any fractional shares rounded down to the next lowest whole number), in each case allocated among the Stockholders in accordance with their Pro Rata Portions.  To the extent the amount payable exceeds the Escrow Collateral, each Stockholder shall be responsible solely for its Pro Rata Portion of any such refund from the Merger Consideration received by him or it pursuant to this Agreement.

(h)           Release of Merger Consideration from Escrow.  In the event that the Closing Balance Sheet as finally determined in accordance with Section 1(g)(iv) does not require an adjustment to the Merger Consideration, then the Escrow Agent shall promptly release one-half of the Stock Escrow Amount (with any fractional shares rounded up to the next highest whole number) to the Stockholders in accordance with the terms and conditions of the Escrow Agreement.  On the first anniversary of the Closing Date, in the event: (a) no claims for indemnification under Section 6(b) of this Agreement made by Buyer are outstanding at such time, or, if any such claims are outstanding, the aggregate amount of Losses claimed thereof is less than $50,000, and (b) no payment obligation by the Stockholders for any 2007 Income Statement Shortfall Adjustment remains outstanding or in dispute, then the Escrow Agent shall release the remaining Escrow Collateral, plus accrued interest, if any, on the Cash Escrow Amount, to the Exchange Agent within five (5) business days following the first anniversary of the Closing Date in accordance with the terms and conditions of the Escrow Agreement.

(i)            Tender of and Payment for Certificates.

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(i)            Appointment of Exchange Agent.  The Stockholders shall designate Marc Waldman to act as Exchange Agent for the Stockholders in connection with the Merger to receive in trust for the Stockholders, pro rata, in accordance with each Stockholders Pro Rata Portions, the Merger Consideration, including final adjustments thereto in accordance with the provisions of Section 1(g), to which the Stockholders shall become entitled pursuant to this Agreement.  If Marc Waldman becomes unable to serve as Exchange Agent, another Stockholder or other person, as may be designated by a majority of the Stockholders, shall succeed as the Exchange Agent.

(ii)           Exchange Procedures.  Promptly at Closing, each Stockholder holding a Certificate or Certificates whose Stock was exchanged pursuant to Section 1(d) hereof for the Merger Consideration, upon surrender of the Certificates for the Stock and delivery of such Certificates to the Exchange Agent, shall receive in exchange therefor the Merger Consideration for each share of Stock formerly represented by such Certificate, and the Certificate so surrendered shall forthwith be delivered by the Exchange Agent to the Guarantor. Until surrendered as contemplated by this Section 1(i), each Certificate shall be deemed at any time after the Effective Time to represent only the right to receive its Pro Rata Portion of the Merger Consideration as contemplated by Section 1(d) hereof.

(iii)          Transfer Books; No Further Ownership Rights in the Stock.  At the Effective Time, the stock transfer books of the Corporation shall be closed, and thereafter there shall be no further registration of transfers of the Stock on the records of the Corporation by the Stockholders.  From and after the Effective Time, the holders of Certificates evidencing ownership of the Stock outstanding immediately prior to the Effective Time shall cease to have any rights with respect to such Stock, except as otherwise provided for herein or by applicable law.  If, after the Effective Time, Certificates are presented to the Exchange Agent for any reason, they shall be cancelled and exchanged as provided in this Section 1(i)(iii).

(iv)          Lost, Stolen or Destroyed Certificates.  In the event any Certificate(s) shall have been lost, stolen or destroyed, upon the making of an affidavit of that fact by the person claiming such Certificate(s) to be lost, stolen or destroyed and, if required by the Buyer, the posting by such person of a bond in such sum as the Buyer may reasonably direct as indemnity against any claim that may be made against any party hereto or the Buyer with respect to such Certificate(s), the Guarantor will issue in exchange for such lost, stolen or destroyed Certificate(s) the Merger Consideration to be paid in respect of the Stock represented by such lost, stolen or destroyed Certificate(s).

(j)            Directors and Officers.  At and after the Effective Time, the officers of the Corporation immediately prior to the Effective Time shall be the officers of the Surviving Corporation until the expiration of their respective terms and until their successors have been elected and qualified.  Immediately after the Effective Time, the directors of the Surviving Corporation shall be the persons mutually agreed to by the parties hereto prior to the Closing, or such other persons as the Guarantor may elect.  If, at the Effective Time, a vacancy shall exist on the Board of Directors or in any office of the Surviving Corporation, such vacancy may thereafter be filled in the manner provided by law.

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(k)           Other Effects of Merger.  At and after the Effective Time, title to all property owned by each of the Corporation and the Buyer shall vest in the Surviving Corporation without reversion or impairment, and the Surviving Corporation shall automatically have all of the liabilities of each of the Corporation and the Buyer.  The Merger shall have all further effects as specified in the applicable provisions of the NYBCL.

(l)            Additional Actions.  If at any time after the Effective Time, the Surviving Corporation shall consider or be advised that any deeds, bills of sale, assignments, assurances or any other actions or things are necessary or desirable to vest, perfect or confirm of record or otherwise in the Surviving Corporation its right, title or interest in, to or under any of the rights, properties or assets of Corporation or otherwise carry out this Agreement, the officers and directors of the Surviving Corporation shall be authorized to execute and deliver, in the name and on behalf of Corporation or the Buyer, all such deeds, bills of sale, assignments and assurances and to take and do, in the name and on behalf of Corporation or the Buyer, all such other actions and things as may be necessary or desirable to vest, perfect or confirm any and all right, title and interest in, to and under such rights, properties or assets in the Surviving Corporation or otherwise to carry out this Agreement.

(m)          Taking of Necessary Action; Further Action.  If, at any time after the Effective Time, any further action is necessary or desirable to carry out the purposes of this Agreement and to vest the Surviving Corporation with full right, title and possession to all assets, property, rights, privileges, powers and franchises of the Buyer, the officers and directors of the Surviving Corporation are fully authorized in the name of the Buyer or otherwise to take, and will take, all such lawful and necessary action.

(n)           Certificate of Incorporation, By-Laws.

(i)            At the Effective Time, the Certificate of Incorporation (the Certificate of Incorporation) of the Corporation, as in effect immediately prior to the Effective Time, shall be the Certificate of Incorporation of the Surviving Corporation until thereafter amended, as provided by law.

(ii)           At the Effective Time, the By-Laws of the Corporation, as in effect immediately prior to the Effective Time, shall be the By-Laws of the Surviving Corporation until thereafter amended as provided by law.

(o)           Intent.  The parties intend that, for federal income tax purposes, the Merger qualify as a reorganization within the meaning of Sections 368(a)(1)(A) and 368(a)(2)(E) of the Code, and that this Agreement constitutes a plan of reorganization within the meaning of Section 368(b) of the Code.  Each party shall treat the Merger consistently with the foregoing, including filing the information and maintaining the records required by Treasury Regulations Section 1.368-3, and shall not take any position inconsistent therewith.  No party shall take any action that would cause the Merger not to qualify as a reorganization within the meaning of Sections 368(a)(1)(A) and 368(a)(2)(E) of the Code.

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