Document:

20-F

Exhibit 4.8  

FORM OF WARRANT 

NEITHER THE ISSUANCE AND SALE OF THE
SECURITIES REPRESENTED BY THIS CERTIFICATE NOR THE SECURITIES INTO WHICH THESE SECURITIES
ARE EXERCISABLE HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR
APPLICABLE STATE SECURITIES LAWS. THESE SECURITIES MAY NOT BE SOLD, OFFERED FOR SALE,
PLEDGED, HYPOTHECATED OR OTHERWISE TRANSFERRED EXCEPT PURSUANT TO REGISTRATION UNDER THE
SECURITIES ACT OF 1933, AS AMENDED OR IN ACCORDANCE WITH THE PROVISIONS OF REGULATION S
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR PURSUANT TO AN AVAILABLE EXEMPTION FROM
REGISTRATION ACCOMPANIED BY AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT SUCH
REGISTRATION IS NOT REQUIRED UNDER SUCH ACT. HEDGING TRANSACTIONS INVOLVING THESE
SECURITIES MAY NOT BE CONDUCTED UNLESS IN COMPLIANCE WITH THE SECURITIES ACT OF 1933, AS
AMENDED. 

ELBIT VISION SYSTEMS LTD. 

WARRANT TO PURCHASE
ORDINARY SHARES 

Warrant No.: _____

Number of Shares:  _____

Date of Issuance: April 30, 2007 ("ISSUANCE DATE")

Elbit Vision Systems Ltd., a company
organized under the laws of the State of Israel (the “COMPANY”), hereby
certifies that, for good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, ______________________ the registered holder hereof or its
permitted assigns (the “HOLDER”), is entitled, subject to the terms set forth
below, to purchase from the Company, at the Exercise Price (as defined below) then in
effect, upon surrender of this Warrant to purchase Ordinary Shares (including all Warrants
to purchase Ordinary Shares issued in exchange, transfer or replacement hereof, the
“WARRANT”), at any time or times on or after the date hereof, but not after
11:59 P.M., Israel Time, on the Expiration Date (as defined below), ______________
(___________) fully paid and nonassessable Ordinary Shares (as defined below) (the
“WARRANT SHARES”). Except as otherwise defined herein, capitalized terms in this
Warrant shall have the meanings set forth in Section 12. This Warrant is one of the
Warrants to purchase Ordinary Shares (the “SPA WARRANTS”) issued pursuant to
Section 1 of that certain Securities Purchase Agreement, dated as of April 30, 2007 (the
“INITIAL ISSUANCE DATE”), among the Company and the purchasers (the
“PURCHASERS”) referred to therein (the “SECURITIES PURCHASE
AGREEMENT”). 

         1.       
          EXERCISE OF WARRANT. 

         a.       
          Subject to the terms and conditions hereof, this Warrant may be exercised by the
          Holder on any day, in whole or in part, by (i) delivery of a written notice, in
          the form attached hereto as EXHIBIT A (the “EXERCISE NOTICE”), of the
          Holder’s election to exercise this Warrant (ii) unless the Holder is
          electing a “cashless” exercise, payment to the Company of an amount
          equal to the applicable Exercise Price multiplied by the number of Warrant
          Shares as to which this Warrant is being exercised (the “AGGREGATE EXERCISE
          PRICE”) in cash or wire transfer of immediately available funds, which may
          be paid, at the sole discretion of the Holder, in U.S. Dollars or in New Israeli
          Shekels, at the representative exchange rate in effect on that day, and (iii)
          the delivery to the Company of this Warrant. Execution and delivery of the
          Exercise Notice with respect to less than all of the Warrant Shares 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.
          On or before the first Business Day following the date on which the Company has
          received each of the Exercise Notice, this Warrant and the Aggregate Exercise
          Price (the “EXERCISE DELIVERY DOCUMENTS”), the Company shall transmit
          by facsimile an acknowledgment of confirmation of receipt of the Exercise
          Delivery Documents to the Holder and the Company’s transfer agent (the
          “TRANSFER AGENT”). On or before the third Business Day following the
          date on which the Company has received all of the Exercise Delivery Documents
          (the “SHARE DELIVERY DATE”), the Company shall (X) provided that the
          Transfer Agent is participating in The Depository Trust Company
          (“DTC”) Fast Automated Securities Transfer Program, upon the request
          of the Holder, credit such aggregate number of Ordinary Shares to which the
          Holder is entitled pursuant to such exercise to the Holder’s or its
          designee’s balance account with DTC through its Deposit Withdrawal Agent
          Commission system, or (Y) if the Transfer Agent is not participating in the DTC
          Fast Automated Securities Transfer Program, issue and dispatch by overnight
          courier to the address as specified in the Exercise Notice, a certificate,
          registered in the name of the Holder or its designee, for the number of Ordinary
          Shares to which the Holder is entitled pursuant to such exercise. Upon delivery
          of the Exercise Delivery Documents, the Holder shall be deemed for all corporate
          purposes to have become the holder of record of the Warrant Shares with respect
          to which this Warrant has been exercised, irrespective of the date of delivery
          of the certificates evidencing such Warrant Shares. If this Warrant is submitted
          in connection with any exercise pursuant to this Section 1(a) and the number of
          Warrant Shares represented by this Warrant submitted for exercise is greater
          than the number of Warrant Shares being acquired upon an exercise, then the
          Company shall as soon as practicable and in no event later than five Business
          Days after any exercise and at its own expense, issue a new Warrant (in
          accordance with Section 6(d)) representing the right to purchase the number of
          Warrant Shares purchasable immediately prior to such exercise under this
          Warrant, less the number of Warrant Shares with respect to which this Warrant is
          exercised. No fractional Ordinary Shares are to be issued upon the exercise of
          this Warrant, but rather the number of Ordinary Shares to be issued shall be
          rounded up or down to the nearest whole number. The Company shall pay any and
          all taxes which may be payable with respect to the issuance and delivery of
          Warrant Shares upon exercise of this Warrant. 

         b.       
          EXERCISE PRICE. For purposes of this Warrant, “EXERCISE PRICE” means
          $0.45, U.S Dollars, subject to adjustment as provided herein. 

         c.       
          CASHLESS EXERCISE. The Holder may notify the Company in an Exercise Notice
          of its election to utilize cashless exercise, in which event the Company shall
          issue to the Holder the number of Warrant Shares determined as follows: 

2

	 	
X
= Y [(A-B)/A] 

where: 

	 	
X
= the number of Warrant Shares to be issued to the Holder. 

	 	
Y
= the number of Warrant Shares with respect to which this Warrant is being exercised. 

	 	
A
= the average of the closing prices for the three Trading Days immediately prior to (but
not including) the Exercise Date. 

	 	
B
= the Exercise Price.

        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. 

        “TRADING
DAY” means (i) a day on which the Ordinary Shares are traded on a Trading
Market (other than the OTC Bulletin Board), or (ii) if the Ordinary Shares are not listed
on a Trading Market (other than the OTC Bulletin Board), a day on which the Ordinary
Shares are traded in the over-the-counter market, as reported by the OTC Bulletin Board,
or (iii) if the Ordinary Shares are not quoted on any Trading Market, a day on which the
Ordinary Shares are quoted in the over-the-counter market as reported by the National
Quotation Bureau Incorporated (or any similar organization or agency succeeding to its
functions of reporting prices); provided, that in the event that the Ordinary Shares are
not listed or quoted as set forth in (i), (ii) and (iii) hereof, then Trading Day shall
mean a Business Day. 

         2.       
          ADJUSTMENT OF EXERCISE PRICE. If the Company at any time after the date of
          issuance of this Warrant subdivides (by any stock split, stock dividend,
          recapitalization or otherwise) one or more classes of its outstanding share
          capital into a greater number of shares, the Exercise Price in effect
          immediately prior to such subdivision will be proportionately reduced and the
          number of Warrant Shares will be proportionately increased. If the Company at
          any time after the date of issuance of this Warrant combines (by combination,
          reverse stock split or otherwise) one or more classes of its outstanding share
          capital into a smaller number of shares, the Exercise Price in effect
          immediately prior to such combination will be proportionately increased and the
          number of Warrant Shares will be proportionately decreased. Any adjustment under
          this Section 2 shall become effective at the close of business on the date the
          subdivision or combination becomes effective. 

         3.       
          RIGHTS UPON CONSOLIDATION OR MERGER. In case of any consolidation or merger to
          which the Company shall be a party, other than a consolidation or merger in
          which the Company shall be the surviving or continuing corporation, or in case
          of any sale or conveyance to another entity of all or substantially all of the
          property of the Company, or in the case of any statutory exchange of securities
          with another entity (including any exchange effected in connection with a merger
          of any other corporation with the Company), the Holder shall have the right
          thereafter to convert this Warrant into the kind and amount of securities, cash
          or other property which it would have owned or have been entitled to receive
          immediately after such consolidation, merger, statutory exchange, sale or
          conveyance had this Warrant been exercised immediately prior to the effective
          date of such transaction and, if necessary, appropriate adjustment shall be made
          in the application of the provisions set forth in Section 2 with respect to the
          rights and interests thereafter of the Holder to the end that the provisions set
          forth in Section 2 shall thereafter correspondingly be made applicable, as
          nearly as may reasonably be, in relation to any shares of stock or other
          securities or property thereafter deliverable upon the exercise of this Warrant. 

3

         4.       
          NONCIRCUMVENTION. The Company hereby covenants and agrees that the Company will
          not, by amendment of its Articles of Association 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, and will at all times in
          good faith carry out all the provisions of this Warrant and take all action as
          may be required to protect the rights of the holder of this Warrant. Without
          limiting the generality of the foregoing, the Company (i) will not increase the
          par value of any Ordinary Shares receivable upon the exercise of this Warrant
          above the Exercise Price then in effect, (ii) will take all such actions as may
          be necessary or appropriate in order that the Company may validly and legally
          issue fully paid and nonassessable Ordinary Shares upon the exercise of this
          Warrant, and (iii) will, so long as any of the SPA Warrants are outstanding,
          take all action necessary to reserve and keep available out of its authorized
          and unissued Ordinary Shares, solely for the purpose of effecting the exercise
          of the SPA Warrants, 100% of the number of Ordinary Shares as shall from time to
          time be necessary to effect the exercise of the SPA Warrants then outstanding. 

         5.       
          WARRANT HOLDER NOT DEEMED A SHAREHOLDER. Except as otherwise specifically
          provided herein, no holder, solely in such Person’s capacity as a holder,
          of this Warrant shall be entitled to vote or receive dividends or be deemed the
          holder of shares of the Company for any purpose, nor shall anything contained in
          this Warrant be construed to confer upon the holder hereof, solely in such
          Person’s capacity as a holder of this Warrant, any of the rights of a
          shareholder of the Company or any right to vote, give or withhold consent to any
          corporate action (whether any reorganization, issue of stock, reclassification
          of share capital, consolidation, merger, conveyance or otherwise), receive
          notice of meetings, receive dividends or subscription rights, or otherwise,
          prior to the issuance to the holder of this Warrant of the Warrant Shares which
          such Person is then entitled to receive upon the due exercise of this Warrant.
          In addition, nothing contained in this Warrant shall be construed as imposing
          any liabilities on such holder to purchase any securities (upon exercise of this
          Warrant or otherwise) or as a shareholder of the Company, whether such
          liabilities are asserted by the Company or by creditors of the Company. 

         6.       
          REISSUANCE OF WARRANTS. 

         a.       
          TRANSFER OF WARRANT. If this Warrant is to be transferred, the holder shall
          surrender this Warrant to the Company, whereupon the Company will forthwith
          issue and deliver upon the order of the holder of this Warrant a new Warrant (in
          accordance with Section 6(d)), registered as the holder of this Warrant may
          request, representing the right to purchase the number of Warrant Shares being
          transferred by the Holder and, if less then the total number of Warrant Shares
          then underlying this Warrant is being transferred, a new Warrant (in accordance
          with Section 6(d)) to the holder of this Warrant representing the right to
          purchase the number of Warrant Shares not being transferred. 

         b.       
          LOST, STOLEN OR MUTILATED WARRANT. Upon receipt by the Company of evidence
          reasonably satisfactory to the Company of the loss, theft, destruction or
          mutilation of this Warrant, and, in the case of loss, theft or destruction, of
          any indemnification undertaking by the holder of this Warrant to the Company in
          customary form and, in the case of mutilation, upon surrender and cancellation
          of this Warrant, the Company shall execute and deliver to the Holder a new
          Warrant (in accordance with Section 6(d)) representing the right to purchase the
          Warrant Shares then underlying this Warrant. 

4

         c.       
          WARRANT EXCHANGEABLE FOR MULTIPLE WARRANTS. This Warrant is exchangeable, upon
          the surrender hereof by the holder of this Warrant at the principal office of
          the Company, for a new Warrant or Warrants (in accordance with Section 6(d))
          representing in the aggregate the right to purchase the number of Warrant Shares
          then underlying this Warrant, and each such new Warrant will represent the right
          to purchase such portion of such Warrant Shares as is designated by the holder
          of this Warrant at the time of such surrender; provided, however, that no
          Warrants for fractional Ordinary Shares shall be given. 

         d.       
          ISSUANCE OF NEW WARRANTS. Whenever the Company is required to issue a new
          Warrant pursuant to the terms of this Warrant, such new Warrant (i) shall be of
          like tenor with this Warrant, (ii) shall represent, as indicated on the face of
          such new Warrant, the right to purchase the Warrant Shares then underlying this
          Warrant (or in the case of a new Warrant being issued pursuant to Section 6(a)
          or Section 6(c), the Warrant Shares designated by the holder of this Warrant
          which, when added to the number of Ordinary Shares underlying the other new
          Warrants issued in connection with such issuance, does not exceed the number of
          Warrant Shares then underlying this Warrant), (iii) shall have an issuance date,
          as indicated on the face of such new Warrant, which is the same as the Issuance
          Date, and (iv) shall have the same rights and conditions as this Warrant. 

         7.       
          NOTICES. Whenever notice is required to be given under this Warrant, unless
          otherwise provided herein, such notice shall be given in accordance with Section
          7(h) of the Securities Purchase Agreement. The Company shall provide the holder
          of this Warrant with prompt written notice of all actions taken pursuant to this
          Warrant, including in reasonable detail a description of such action and the
          reason therefor. Without limiting the generality of the foregoing, the Company
          will give written notice to the holder of this Warrant (i) promptly upon any
          adjustment of the Exercise Price, setting forth in reasonable detail, and
          certifying, the calculation of such adjustment and (ii) at least fifteen days
          prior to the date on which the Company takes a record (A) with respect to any
          dividend or distribution upon the Ordinary Shares, or (B) with respect to any
          consolidation or merger provided in each case that such information shall be
          made known to the public prior to or in conjunction with such notice being
          provided to such holder. 

         8.       
          AMENDMENT AND WAIVER. Except as otherwise provided herein, the provisions of
          this Warrant may be amended and the Company may take any action herein
          prohibited, or omit to perform any act herein required to be performed by it,
          only if the Company has obtained the written consent of the holders of SPA
          Warrants representing at least a majority of the Ordinary Shares obtainable upon
          exercise of the SPA Warrants then outstanding; provided that no such action may
          increase the initial exercise price of any SPA Warrant or decrease the initial
          number of shares or class of stock obtainable upon exercise of any SPA Warrant
          without the written consent of the holder of this Warrant. No such amendment
          shall be effective to the extent that it applies to less than all of the holders
          of the SPA Warrants then outstanding. 

5

         9.       
          GOVERNING LAW. This Warrant shall be governed by and construed in accordance
          with the internal laws of the State of Israel, without giving effect to any
          statutes concerning choice or conflict of law. Any controversy or claim arising
          out of or in connection with this agreement or any breach or alleged breach
          hereof shall be exclusively resolved by the competent courts of Tel Aviv,
          Israel, and each of the parties hereby irrevocably submits to the exclusive
          jurisdiction of such courts. 

         10.       
          CONSTRUCTION; HEADINGS. This Warrant shall be deemed to be jointly drafted by
          the Company and all the Purchasers and shall not be construed against any person
          as the drafter hereof. The headings of this Warrant are for convenience of
          reference and shall not form part of, or affect the interpretation of, this
          Warrant. 

         11.       
          REMEDIES, OTHER OBLIGATIONS, BREACHES AND INJUNCTIVE RELIEF. The remedies
          provided in this Warrant shall be cumulative and in addition to all other
          remedies available under this Warrant, the Securities Purchase Agreement, the
          SPA Securities and the Registration Rights Agreement, at law or in equity
          (including a decree of specific performance and/or other injunctive relief), and
          nothing herein shall limit the right of the holder of this Warrant right to
          pursue actual damages for any failure by the Company to comply with the terms of
          this Warrant. The Company acknowledges that a breach by it of its obligations
          hereunder will cause irreparable harm to the holder of this Warrant and that the
          remedy at law for any such breach may be inadequate. The Company therefore
          agrees that, in the event of any such breach or threatened breach, the holder of
          this Warrant shall be entitled, in addition to all other available remedies, to
          an injunction restraining any breach, without the necessity of showing economic
          loss and without any bond or other security being required. 

         12.       
          TRANSFER. Subject to compliance with any applicable securities laws, this
          Warrant may be offered for sale, sold, transferred or assigned without the
          consent of the Company, except as may otherwise be required by Section 2(f) of
          the Securities Purchase Agreement. 

         13.       
          CERTAIN DEFINITIONS. For purposes of this Warrant, the following terms shall
          have the following meanings: 

        “BUSINESS
DAY” means any day other than Saturday, Sunday or other day on which commercial banks
in the City of New York are authorized or required by law to remain closed. 

        “ORDINARY
SHARES” means the Company’s Ordinary Shares, par value NIS 1.0 per share. 

        “EXPIRATION
DATE” means forty-eight (48) months after the Closing Date (as defined in the
Securities Purchase Agreement) pursuant to which this Warrant was initially issued;
provided, however, that if such date falls on a day other than a Business Day or on which
trading does not take place on the Principal Market (a “Holiday”), the next date
that is not a Holiday. 

        “OPTIONS”
means any rights, warrants or options to subscribe for or purchase Ordinary Shares. 

6

        “PERSON”
means an individual, a limited liability company, a partnership, a joint venture, a
corporation, a trust, an unincorporated organization, any other entity and a government or
any department or agency thereof. 

        “PRINCIPAL
MARKET” means NASD Over-the-Counter Bulletin Board or in the event that the Company
is no longer listed with NASD Over-the-Counter Bulletin Board, the market or exchange on
which the Ordinary Shares are then listed and traded, which only may be The New York Stock
Exchange, Inc., the American Stock Exchange or the Nasdaq National Market. 

        “REGISTRATION
RIGHTS AGREEMENT” means that certain registration rights agreement between the
Company and the Purchasers. 

        “SPA
SECURITIES” means the Ordinary Shares issued pursuant to the Securities Purchase
Agreement. 

[SIGNATURE PAGE FOLLOWS] 

7

[Signature page
– Warrant] 

IN WITNESS WHEREOF, the Company has
caused this Warrant to Purchase Ordinary Shares to be duly executed as of the Issuance
Date set out above. 

ELBIT VISION SYSTEMS LTD. 

	By:
——————————————

Name:
Title:		

8

EXHIBIT A

EXERCISE NOTICE

TO BE EXECUTED BY THE REGISTERED HOLDER TO EXERCISE THIS WARRANT TO PURCHASE ORDINARY SHARES

ELBIT VISION SYSTEMS LTD. 

The undersigned holder hereby
exercises the right to purchase _________________ of the Ordinary Shares (“WARRANT
SHARES”) of Elbit Vision Systems Ltd., a company organized under the laws of the
State of Israel (the “Company”), evidenced by the attached Warrant to Purchase
Ordinary Shares (the “WARRANT”). Capitalized terms used herein and not otherwise
defined shall have the respective meanings set forth in the Warrant. 

         1.       
          Form of Exercise Price. The Holder intends that payment of the Exercise Price
          shall be made as: 

____________ a "CASH EXERCISE" with respect to _________________ Warrant Shares; or

____________ a "CASHLESS EXERCISE" with respect to _________________ Warrant Shares.

         2.       
          Payment of Exercise Price. If using a “Cash Exercise: The holder is hereby
          delivering to the Company payment in the amount of $_________ or NIS _________
          representing the Aggregate Exercise Price for such Warrant Shares. 

         3.       
          Delivery of Warrant Shares. The Company shall deliver to the holder __________
          Warrant Shares in accordance with the terms of the Warrant. 

Date: _______________ __,
______ 

——————————————
Name of Registered Holder

	By:
——————————————

Name:
Title:		

920-F

Exhibit 4.9  

REGISTRATION RIGHTS
AGREEMENT  

        THIS
 REGISTRATION  RIGHTS  AGREEMENT (this  "Agreement")  made as of  January 1, 2007,  by and
among Elbit Vision Systems Ltd. (the "Company") and Elbit Ltd. ("Elbit").  

W  I  T  N  E  S  S  E  T  H: 

        WHEREAS,
Elbit holds 2,647,643 Ordinary Shares of the Company and together with Water Technologies
Ltd., a fully owned subsidiary of Elbit, holds warrants to purchase 1,512,939
Ordinary Shares of the Company (all of such Ordinary Shares, including the Ordinary
Shares issuable upon exercise of such warrants being the “Shares”), and
the Company has agreed to provide certain registration rights under the Securities Act of
1933, as amended, and the rules and regulations thereunder, or any similar successor
statute (collectively, the “1933 Act”). 

        NOW,
THEREFORE, in consideration of the mutual promises and covenants set forth herein, the
parties hereby agree as follows: 

         1.       
          Registration of Shares. 

        (a)
          The Company shall file with the United States Securities and Exchange
Commission           (the “SEC”) a registration statement on Form F-1 or
Form F-3           under the 1933 Act, as determined in the sole discretion of the
Company, with           respect to the registration of the Shares (the “Registration
          Statement”) by no later than September 30, 2007 (the           “Submission
Date”); provided, that in the event the Company           files a registration
statement for its benefit and/or for the benefit of selling           shareholders, other
than a registration of securities in a Rule 145 transaction           or with respect to
an employee benefit plan, prior to such date (the           “Company Registration
Statement”), (i) the Company shall notify           Elbit a reasonable time in
advance of the planned filing date, and (ii) Elbit           shall be permitted to
include some or all of the Shares in such registration           statement, provided that
Elbit notifies the Company in writing in a timely           fashion, of its desire, and
number of Shares, to be included in such           registration statement.
Notwithstanding the foregoing, the Company shall use its           best efforts to file
the Registration Statement prior to the Submission Date,           provided that such
commitment shall not require the Company to file the           Registration Statement
prior to the filing of its Annual Report on Form 20-F for           the year ended
December 31, 2006, with the SEC. The Company shall provide Elbit           a reasonable
time to review and comment on the Registration Statement (and any           amendments or
supplements) before it is filed.  

        (b)
          The Company shall prepare and file with the SEC such amendments and supplements
          to the Registration Statement and the prospectus used in connection therewith
as           may be necessary to keep the Registration Statement effective until the
earlier           of (i) the date on which all of the Shares may immediately be resold
without           registration during any 90 day period by reason of Rule 144 under the
1933 Act           or any other rule of similar effect; or (ii) such time as all Shares
have been           sold.  

        (c)
          The Company shall furnish to Elbit such number of copies of prospectuses and
          such other documents as Elbit may reasonably request, in order to facilitate
the           public sale or other disposition of all or any of the Shares held by Elbit;  

        (d)
          The Company shall use reasonable efforts to cause the Registration Statement to
          become effective as soon as practicable after filing. The Company shall notify
          Elbit upon receipt of confirmation from the SEC that the Registration Statement
          has been declared effective.  

        (e)
          The Company shall notify Elbit, during the time when a prospectus relating to
          the Shares is required to be delivered under the 1933 Act, on a timely basis,
of           any event as a result of which the prospectus included in the Registration
          Statement contains an untrue statement of a material fact or omits any fact
          necessary to make the statements in the prospectus not misleading, in view of
          the circumstances in which they were made; and, at the request of Elbit,
prepare           a supplement or amendment to the prospectus so that, when delivered to
          purchasers of the Shares, the prospectus, as supplemented or amended, does not
          contain an untrue statement of a material fact or omit to state any fact
          necessary to make the statements in the prospectus not misleading, in view of
          the circumstances in which they were made, and notify Elbit on the day of the
          filing of such supplement or amendment.  

        (f)
          Once the Registration Statement has been declared effective by the SEC, the
          Company shall cause all the Shares to be quoted on the Over the Counter
Bulletin           Board or any other exchange on which the Company’s Ordinary
Shares are           listed as promptly as practicable.  

        (g)
          In the event of the issuance of any stop order suspending the effectiveness of
          the Registration Statement, or of any order suspending or preventing the use of
          any related prospectus or suspending the qualification of any securities
          included in the Registration Statement for sale in any jurisdiction, the
Company           shall notify Elbit on the day of such issuance, use reasonable efforts
to           promptly obtain the withdrawal of such order, and notify Elbit on the day of
          such withdrawal, if so ordered.  

        (h)
          The Company shall reasonably cooperate with Elbit in providing information
          reasonably required in connection with any filings to be made by Elbit in
          connection with sales under Rule 144.  

        (i)
          Notwithstanding anything to the contrary herein, it is hereby clarified, that
          Elbit shall not have the right to demand an underwritten offering.  

         2.       
          Expenses. The Company shall bear all expenses in connection with the
          registration procedures set forth in Section 1 and the registration of the
          Shares pursuant to the Registration Statement, other than fees and expenses, if
          any, of counsel or other advisers to Elbit or underwriting discounts, brokerage
          fees and commissions incurred by Elbit, if any. 

    3.        Indemnities.
In the event of any registered offering of Ordinary Shares           of the Company
pursuant to this Agreement:  

     (a)    
          The Company will indemnify and hold Elbit, its officers, directors and
          employees, harmless, to the fullest extent permitted by law, from and against
          any and all losses, damages, claims, liabilities, joint or several, costs and
          expenses (including any amounts paid in any settlement effected with the
          Company’s consent) to which Elbit may become subject under applicable law
          or otherwise, insofar as such losses, damages, claims, liabilities (or actions
          or proceedings in respect thereof), costs or expenses arise out of or are based
          upon (i) any untrue statement or alleged untrue statement of any material fact
          contained in the registration statement or included in the preliminary or final
          prospectus, as amended or supplemented, or (ii) the omission or alleged omission
          to state therein a material fact required to be stated therein or necessary to
          make the statements therein, in the light of the circumstances in which they are
          made, not misleading, and the Company will reimburse Elbit , promptly upon
          demand, for any reasonable legal or any other expenses incurred by them in
          connection with investigating, preparing to defend or defending against or
          appearing as a third-party witness in connection with such loss, claim, damage,
          liability, action or proceeding; provided, however, that the
          Company will not be liable in any such case to the extent that any such loss,
          damage, liability, cost or expense arises out of or is based upon an untrue
          statement or alleged untrue statement or omission or alleged omission so made in
          conformity with information furnished in writing by Elbit specifically for
          inclusion therein; provided, further, that the indemnity agreement
          contained in this subsection 3(a) shall not apply to amounts paid in
          settlement of any such claim, loss, damage, liability or action if such
          settlement is effected without the consent of the Company, which consent shall
          not be unreasonably withheld. 

     (b)    
          Elbit will indemnify and hold the Company, its officers, directors and
          employees, and any underwriters for the Company harmless from and against any
          and all losses, damages, claims, liabilities, costs or expenses (including any
          amounts paid in any settlement effected with the selling shareholder’s
          consent) to which the Company or any such underwriter may become subject under
          applicable law or otherwise, insofar as such losses, damages, claims,
          liabilities (or actions or proceedings in respect thereof), costs or expenses
          arise out of or are based on (i) any untrue or alleged untrue statement of
          any material fact contained in the registration statement or included in the
          preliminary or final prospectus, as amended or supplemented, or (ii) the
          omission or the alleged omission to state therein a material fact required to be
          stated therein or necessary to make the statements therein, in the light of the
          circumstances in which they were made, not misleading, and Elbit will reimburse
          the Company and any underwriter promptly upon demand, for any reasonable legal
          or other expenses incurred by them in connection with investigating, preparing
          to defend or defending against or appearing as a third-party witness in
          connection with such loss, claim, damage, liability, action or proceeding; in
          each case to the extent, but only to the extent, that such untrue statement or
          alleged untrue statement or omission or alleged omission was so made in strict
          conformity with written information furnished by Elbit specifically for
          inclusion therein. The foregoing indemnity agreement is subject to the condition
          that, insofar as it relates to any such untrue statement (or alleged untrue
          statement) or omission (or alleged omission) made in the preliminary prospectus
          but eliminated or remedied in the amended prospectus at the time the
          registration statement becomes effective or in the final prospectus, such
          indemnity agreement shall not inure to the benefit of (i) the Company and
          (ii) any underwriter, if a copy of the final prospectus was not furnished
          to the person or entity asserting the loss, liability, claim or damage at or
          prior to the time such furnishing is required by the 1933 Act; provided,
          further, that this indemnity shall not be deemed to relieve any
          underwriter of any of its due diligence obligations; provided,
          further, that the indemnity agreement contained in this
          subsection 3(b) shall not apply to amounts paid in settlement of any such
          claim, loss, damage, liability or action if such settlement is effected without
          the consent of Elbit, which consent shall not be unreasonably withheld. 

     (c)    
          Promptly after receipt by an indemnified party pursuant to the provisions of
          Sections 3(a) or 3(b) of notice of the commencement of any action involving the
          subject matter of the foregoing indemnity provisions, such indemnified party
          will, if a claim thereof is to be made against the indemnifying party pursuant
          to the provisions of said Section 3(a) or 3(b), promptly notify the indemnifying
          party of the commencement thereof; but the omission to notify the indemnifying
          party will not relieve it from any liability which it may have to any
          indemnified party otherwise than hereunder, except to the extent that the
          indemnifying party is prejudiced in its ability to defend such action. In case
          such action is brought against any indemnified party and it notifies the
          indemnifying party of the commencement thereof, the indemnifying party shall
          have the right to participate in, and, to the extent that it may wish, jointly
          with any other indemnifying party similarly notified, to assume the defense
          thereof with counsel reasonably satisfactory to such indemnified party;
          provided, however, that if the defendants in any action include
          both the indemnified party and the indemnifying party and there is a conflict of
          interests which would prevent counsel for the indemnifying party from also
          representing the indemnified party, the indemnified party or parties shall have
          the right to select one separate counsel to participate in the defense of such
          action on behalf of such indemnified party or parties. After notice from the
          indemnifying party to such indemnified party of its election so to assume the
          defense thereof, the indemnifying party will not be liable to such indemnified
          party pursuant to the provisions of said Sections 3(a) or 3(b) for any legal or
          other expense subsequently incurred by such indemnified party in connection with
          the defense thereof, unless (i) the indemnified party shall have employed
          counsel in accordance with the provision of the preceding sentence, (ii) the
          indemnifying party shall not have employed counsel reasonably satisfactory to
          the indemnified party to represent the indemnified party within a reasonable
          time after the notice of the commencement of the action and within fifteen (15)
          days after written notice of the indemnified party’s intention to employ
          separate counsel pursuant to the previous sentence, or (iii) the indemnifying
          party has authorized the employment of counsel for the indemnified party at the
          expense of the indemnifying party. No indemnifying party will consent to entry
          of any judgment or enter into any settlement which does not include as an
          unconditional term thereof the giving by the claimant or plaintiff to such
          indemnified party of a release from all liability in respect to such claim or
          litigation. The indemnification provisions under this Section 3 will remain in
          full force and effect regardless of any investigation by the indemnified
          party(ies). 

     4.        Miscellaneous.  

     4.1        Governing
Law. This Agreement shall be construed in accordance with, and governed in all
respects by, the internal laws of the State of Israel (without giving effect to
principles of conflicts of laws). Each party to this Agreement consents to the exclusive
jurisdiction and venue of the courts of District of Tel Aviv-Jaffa in the State of
Israel.  

     4.2        Successors
and Assigns. The provisions hereof shall inure to the benefit of, and be binding
upon, the successors, assignees, heirs, executors and administrators of the parties
hereto.  

     4.3        Entire
Agreement; No Rights in Favor of Third Party; Amendments. This Agreement constitutes
the full and entire understanding and agreement between the parties with regard to the
subject matters hereof and thereof shall supersede all prior agreements and
understandings relating thereto. This Agreement shall not be construed as conferring any
rights to any person not a party hereto. Neither this Agreement nor any term hereof may
be amended, waived, discharged or terminated except by an instrument in writing signed by
the parties hereto.  

     4.4        Notices.
All notices and other communications required or permitted to be given or sent hereunder
shall be in writing and shall be deemed to have been sufficiently given or delivered for
all purposes if mailed by registered mail, sent by fax or delivered by hand to the
following respective addresses until otherwise directed by notice as aforesaid:  

			
			
			
			
			
	 	To Elbit:	Elbit Ltd.
	 	 	3 Azrieli Center, 42nd Floor,
	 	 	Triangle Building, Tel Aviv
	 	 	Tel: 03-607 5555
	 	 	Fax: 03 - 607 5556
	 	 	Att: General Counsel
	 	 
	 	To the Company:	Elbit Vision Systems Ltd.
	 	 	New Industrial Park
	 	 	P.O.B. 140
	 	 	Yoqneam 20692, Israel
	 	 	Fax: 04 - 989-4733
	 	 	Attention: Chief Executive Officer
	 	 
	 	With a copy to:	Yigal Arnon & Co.
	 	 	One Azrieli Center (Round Tower)
	 	 	46th Floor
	 	 	Tel Aviv 67021, Israel
	 	 	Fax: 03 - 608-7714
	 	 	Att: Adrian Daniels

provided, however, that notice of
change of address shall be effective only upon actual receipt. 

        All
notices sent by registered mail shall be deemed to have been received: (i) within three
(3) business days following the date on which it was deposited postage prepaid in the
mail; (ii) within one (1) business day after it was transmitted by fax and confirmation of
receipt has been obtained; and (iii) if delivered by hand shall be deemed to have been
received at the time of actual receipt. 

     4.5        Delays
or Omissions. No delay or omission to exercise any right, power or remedy, upon any
breach or default under this Agreement, shall impair any such right, power or remedy of
such holder nor shall it be construed to be a waiver of any such breach or default, or an
acquiescence therein, or of any similar breach or default thereafter occurring.  

     4.6        Waiver
of Default. No waiver with respect to any breach or default in the performance of any
obligation under the terms of this Agreement shall be deemed to be a waiver with respect
to any subsequent breach or default, whether of similar or different nature. Any waiver,
permit, consent or approval of any kind or character on the part of any holder of any
breach or default under this Agreement, or any waiver on the part of any holder of any
provisions or conditions of this Agreement shall be effective only if made in writing and
only to the extent specifically set forth in such writing. All remedies, either under
this Agreement or by virtue of law or otherwise afforded to any holder, shall be
cumulative and not alternative.  

     4.7        Rights;
Severability. In case any provision of the Agreement shall be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining provisions
shall not in any way be affected or impaired thereby. The parties hereto shall be obliged
to draw up an arrangement in accordance with the meaning and the object of the invalid
provision.  

     4.8        Titles
and Subtitles. The titles of the sections and subsections of this Agreement are for
convenience of reference only and are not to be considered in construing this Agreement.  

     5.        Corporate
Approval. Notwithstanding anything to the contrary herein, this           Agreement
is contingent upon approval of this Agreement by the shareholders of           the
Company. The Company will recommend that its shareholders approve the terms           of
the Agreement at the next meeting of its shareholders, which will take place           no
later than December 31, 2006.  

IN WITNESS WHEREOF, the
parties hereto have executed this Registration Rights Agreement in one or more
counterparts, as of the date first above-mentioned. 

	
——————————————

Elbit Ltd.

By:____________________
Title: __________________	
——————————————

Elbit Vision Systems Ltd.

By:____________________
Title: __________________

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