The funding by BioMedix Ltd. would come through a share swap arrangement.
Under the deal, BioMedix will buy 5,229,659 restricted SDSS shares for 4 cents per share using its subsidiary Gefen Biomed Investments Ltd. Suspect Detection Systems will receive 921,790 shares of Gefen.
"SDSS continues to progress in its efforts to bring added value to our shareholders," said SDSS Chief Executive Officer Gil Boosidan. "The funding that we receive upon from our sale of our Gefen shares can be used to enhance our ability to add personnel and acquire resources and support our marketing efforts to achieve projects with strategic partners.
"Suspect Detection Systems Inc. is continuing its efforts to improve cash flow, which will also improve our financial condition and should result in share price appreciation. Our long-term plan includes seeking to upgrade our share listings to higher level exchanges including foreign listings in the future."
Suspect Detection Systems manufactures a system call Cogito, an interrogatory system that detects the hidden "hostile intent" of assailants before they commit their intended acts with a high degree of accuracy.
The system can also be used after a crime is committed to quickly identify criminals from among a general population pool.