Document:

Exhibit
4.11

 

[* * *]
Portions of this agreement were omitted and a complete copy of this agreement has been provided separately to the Securities and
Exchange Commission pursuant to the company’s application requesting confidential treatment under Rule 24b-2 of the Securities
Exchange Act of 1934, as amended.

 

MANUFACTURING
SERVICES AGREEMENT 

 

This
Manufacturing Services Agreement ("Agreement") is entered into on May [__], 2015 (the "Effective Date")
by and between Kornit Digital Ltd. having its place of business at 12 Ha`Amal St., Afek Park, Rosh-Ha`Ayin 4809246, Israel ("Kornit"),
and Flextronics (Israel) Ltd., having its place of business at 2 Hamatechet St., Ramat Gavriel Industrial Park Migdal Ha-Emek
23108 Israel P.O.B. 867 Israel ("Flextronics"). Kornit and Flextronics are referred to collectively as the "Parties",
individually as a "Party".

 

WHEREAS,
Flextronics is in the business of providing manufacturing services that include the custom manufacture of digital printers;

 

WHEREAS,
Kornit is in the business of developing and/or manufacturing the Products (as defined below); and

 

WHEREAS,
Kornit desires to engage Flextronics to perform certain manufacturing services and possibely certain design services as further
set forth in this Agreement and in applicable agreed upon specifications to be attached or incorporated by reference.

 

NOW
THEREFORE, Kornit and Flextronics hereby agree as follows:

 

1.
Definitions

 

		1.1	"Aged
                                         Inventory" will mean either of any Product, partially completed Product, Inventory
                                         or Special Inventory, or some or all, for which there has been zero or insignificant
                                         consumption over the past [* * *], which includes any particular item that Flextronics
                                         has had on hand for more than [* * *].

 

		1.2	"Approved
                                         Vendor List" will mean the list of vendors approved by Kornit to supply the
                                         Components or services listed on the Bill of Materials.

 

		1.3	"Basis
                                         Representative Exchange Rate" will mean the representative exchange rate of
                                         the U.S. Dollar to the NIS last published by the Bank of Israel prior to the Effective
                                         Date.

 

		1.4	"Bill
                                         of Materials" (BOM) will mean a list of Components required for the manufacture,
                                         assembly, testing and packaging of each Product based on the most current Specifications.
                                         The Parties will mutually agree on each BOM.

 

		1.5	"Components"
                                         will mean the parts, materials, assemblies and supplies that are used for the manufacture,
                                         assembly, testing and packaging of each Product, as stipulated in the respective Bill
                                         of Materials; each of Kornit and Flextronics may supply Components as defined herein,
                                         if so indicated in the Bill of Materials.

 

		1.6	"Consigned
                                         Tooling and Equipment" shall have the meaning set forth in Section ‎3.2
                                         below.

 

		1.7	"Confidential
                                         Information" shall have the meaning set forth in Section ‎29.1 below.

 

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		1.8	"Cost"
                                         will mean the agreed cost of Components represented on the BOM current at the time such
                                         Components are acquired.

 

		1.9	"Customer
                                         Controlled Materials" will mean Components provided by Kornit or by vendors
                                         with whom Kornit has a commercial relationship.

 

		1.10	"Customer
                                         Controlled Materials Terms" will mean the terms and conditions that govern the
                                         purchase of Customer Controlled Materials.

 

		1.11	"Damages"
                                         shall have the meaning set forth in Section ‎22.1 below.

 

		1.12	"Days"
                                         will mean calendar days, which unless otherwise specified, include Saturdays and Sundays.
                                         "Business Days" do not include Friday, Saturdays or Israeli recognized
                                         holidays.

 

		1.13	"Deliverables"
                                         will mean the items delivered to Kornit by Flextronics pursuant to the Design SOW, including
                                         any New Developments incorporated therein and any pre-production, prototype or trial
                                         units of the Product(s).

 

		1.14	"Delivery
                                         Date" will mean such date which shall be no longer than the Lead Time of the
                                         Products or as mutually agreed upon in writing between the Parties.

 

		1.15	"Design
                                         Services" shall have the meaning set forth in Section ‎4.1 below.

 

		1.16	"Design
                                         Specifications" shall have the meaning set forth in Section ‎4.1 below.

 

		1.17	"Design
                                         Statement of Work (SOW)" shall have the meaning set forth in Section ‎4.1
                                         below.

 

		1.18	"Economic
                                         Order Inventory" will mean Components purchased in quantities above the required
                                         amount for Purchase Orders or for Design SOW, as applicable, in order to achieve price
                                         targets for such Components.

 

		1.19	"Engineering
                                         Change Order" (ECO) will mean the document that details a change in the Specifications
                                         and/or the Product.

 

		1.20	"Environmental
                                         Regulations" will mean any applicable hazardous substance content laws and regulations.

 

		1.21	"Excess
                                         Inventory" will mean either of any Product, partially completed Product, Inventory
                                         or Special Inventory, or some or both, owned by Flextronics that is not required for
                                         consumption to satisfy the next [* * *]of demand for Products under the then-current
                                         Purchase Order(s).

 

		1.22	"Intellectual
                                         Property Rights" will mean any and all intellectual property rights worldwide
                                         arising under statutory law, common law or by contract and whether or not perfected,
                                         including without limitation: (i) trade dress, trademark, and service mark rights; (ii)
                                         patents, patent applications and patent rights; (iii) rights associated with works or
                                         authorship including copyrights, copyright applications, copyright registrations, mask
                                         works rights, mask work applications, mask work registrations; (iv) rights relating to
                                         trade secrets and confidential information; (v) any rights analogous to those set forth
                                         in this section and any other proprietary rights relating to intellectual property; and
                                         (vi) divisionals, continuations, renewals, reissues and extension of the foregoing (as
                                         and to the extent applicable) now existing, hereafter filed, used or acquired, and whether
                                         registered or unregistered.

 

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		1.23	"Inventory"
                                         will mean any Components that are procured by or on-order with Flextronics in accordance
                                         with the terms of this Agreement for use in the manufacture of Products, pursuant to
                                         a Purchase Order or for the manufacture of the Deliverables pursuant to a Design SOW.
                                         

 

		1.24	"Lead
                                         Time" shall have the meaning set forth in Section ‎12.1 below.

 

		1.25	"Minimum
                                         Order Inventory" will mean Components purchased in excess of requirements for
                                         Purchase Orders or for Design SOW, as applicable, because of minimum lot sizes required
                                         by the vendor.

 

		1.26	"New
                                         Developments" shall have the meaning set forth in Section ‎21.5 below.

 

		1.27	"Obsolete
                                         Inventory" will mean either of any Product, partially completed Product, Inventory
                                         or Special Inventory, or some or all that is any of the following: (a) removed from the
                                         BOM for a Product by an engineering change; or (b) no longer on an active BOM for any
                                         of Kornit's Products.

 

		1.28	"Overseas
                                         Services" shall have the meaning set forth in Section ‎3.5 below.

 

		1.29	"Overseas
                                         Site" shall mean Flextronics affiliate's site in Venray, Netherlands or any
                                         other site of a Flextronics affiliate worldwide, as mutually agreed between the Parties.

 

		1.30	"Product(s)"
                                         will mean digital printers known as "[* * *]" and "[* * *]"
                                         or any other product as shall be mutually agreed by the Parties in writing.

 

		1.31	"Product
                                         Specification" or "Specifications" will mean the written specifications
                                         provided by Kornit to Flextronics and accepted by Flextronics for the manufacture, assemble
                                         and testing of a Product including, without limitation, the current revision number,
                                         Approved Vendor List (AVL), Bill of Materials (BOM), manufacturing procedures, schematics,
                                         testing procedures, drawings and documentation, attached hereto as Exhibit D.

 

		1.32	"Purchase
                                         Order" will mean purchase order for the Products issued by Kornit and accepted
                                         by Flextronics in accordance with the terms of this Agreement. The terms of this Agreement
                                         will control over printed terms on any Purchase Order, quotation, acknowledgement, confirmation
                                         or invoice.

 

		1.33	"Representative
                                         Exchange Rate" will mean the representative exchange rate of the U.S. Dollar
                                         to the NIS last published by the Bank of Israel prior to the issuance of the respective
                                         invoice.

 

		1.34	"Special
                                         Inventory" will mean any mutually-agreed Minimum Order Inventory, Economic Order
                                         Inventory, safety stock and other Inventory acquired by Flextronics in excess of requirements
                                         for Purchase Orders to support flexibility or demand requirements.

 

2.
Personnel

 

		2.1	Each
                                         Party will appoint a program manager as the program liaison with the other Party in connection
                                         with the initial coordination and implementation of the design and manufacture of the
                                         Products, which will also deal with ongoing support issues thereafter. The Parties agree
                                         to conduct periodic technical reviews and business reviews. The technical reviews will
                                         include, but will not be limited to, design review, product performance, testing, project
                                         schedule and product costs. The business reviews will include, but will not be limited
                                         to, quality, delivery, flexibility, service and price. The program managers will coordinate
                                         these reviews.

 

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		2.2	Flextronics
                                         will provide a list of program team members representing the functions listed below.
                                         The list will include name, title, phone number and email address. The Program Team List
                                         will be attached as Exhibit A.

 

(a)       Program
Manager

 

(b)       Head
of Assembly

 

(c)       Head
of Integration

 

(d)       Quality
Assurance

 

		2.3	Each
                                         of Flextronics' personnel that will be engaged in the performance of services hereunder
                                         will have the proper skills, training and professional background to perform such services.

 

3.
Manufacture of Products

 

		3.1	During
                                         the term of this Agreement, Flextronics will manufacture, assemble and test the Products
                                         in accordance with the Specifications and pursuant to the respective Purchase Orders.
                                         Flextronics will maintain manufacturing and test records in accordance with reasonable
                                         industry standards. Unless specifically agreed otherwise in writing between the Parties,
                                         in case of any conflict between the Specifications and this Agreement, this Agreement
                                         shall prevail.

 

		3.2	Kornit
                                         and Flextronics agree to work on a "full turnkey basis". This means that Flextronics
                                         will purchase all Components pursuant to Purchase Orders and provide standard production
                                         equipment that is not Product-specific (e.g. production desks, lifting stages, storage
                                         equipment etc.), as necessary to fulfill such Purchase Orders. However, Kornit shall
                                         supply certain tooling and equipment that are unique to Kornit Products as outlined in
                                         Exhibit B (the "Consigned Tooling and Equipment"). Flextronics
                                         shall not be required to pay for such Consigned Tooling and Equipment.

 

		3.3	Any
                                         communication with a supplier/vendor/subcontractor in Flextronics's supply chain, whether
                                         verbally or in writing, shall be conducted solely via Flextronics.

 

		3.4	Kornit
                                         may request Flextronics to maintain a safety stock of Components and/or Products. The
                                         terms and fees for such safety stock shall be mutually agreed between the Parties in
                                         writing and in accordance with the applicable purchase order.

 

		3.5	Kornit
                                         may request at any time that certain type and quantity of Products (whether covered under
                                         an open Purchase Order or under a new purchase order issued by Kornit for that purpose)
                                         will be assembled and packed outside Israel, at an Overseas Site (the "Overseas
                                         Services") and Flextronics shall accept such request subject to the provisions
                                         of Section ‎11.2 below. In order to provide the Overseas Services Flextronics will
                                         ship all required Components and will send sufficient number of personnel from Flextronics
                                         site in Yavne to the Overseas Site. Kornit shall be liable, subject to its prior written
                                         consent, for all costs associated with the performance of the Overseas Services, including
                                         without limitation, shipping costs of the Components, flight and accommodation costs
                                         of Flextronics personnel and storage costs, all in accordance with Flextronics then current
                                         quotation for the Overseas Services. Kornit acknowledges that the Overseas Services will
                                         be provided by the same personnel that provide the services hereunder at Flextronics
                                         site in Yavne therefore during the performance of the Overseas Services there may be
                                         delays in the deliveries of the Products in Israel.

 

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4.
Design Services 

 

		4.1	Kornit
                                         may engage Flextronics, in its sole discretion, to perform design and development, pre-production
                                         manufacturing engineering and prototype and first article manufacturing (the "Design
                                         Services") with respect to the Products pursuant to mutually agreed upon written
                                         designs and specifications (the "Design Specifications") and a design
                                         statement of work prepared by mutual agreement of the Parties (the "Design Statement
                                         of Work (SOW)").

 

		4.2	Flextronics
                                         will perform the Design Services using careful, efficient, and qualified workers, and
                                         in a professional and workmanlike manner in accordance with the Design SOW. The Deliverables
                                         will conform in all material respects to the Design Specifications. Flextronics's sole
                                         liability and Kornit's sole and exclusive remedy for the breach of such obligations of
                                         performance or conformance is set forth in Section ‎16.1 below. Except as otherwise
                                         expressly provided herein, the Deliverables (including any prototype or trial units of
                                         the Product) shall be provided on an "as-is" basis. Flextronics makes no warranty
                                         whatsoever with respect to commercial products manufactured by third parties based on
                                         or incorporating all or any part of the Deliverables.

 

		4.3	In
                                         the event the Design Specifications require that the Product be compliant with Environmental
                                         Regulations, Kornit agrees that Flextronics is only responsible for ensuring that, for
                                         the Components that Flextronics includes in the Deliverables, Flextronics has received
                                         from suppliers of such Components a certificate of compliance with such Environmental
                                         Regulations. Kornit agrees that Flextronics has no responsibility whatsoever in the event
                                         the Components are determined to be not in compliance with such Environmental Regulations.
                                         Kornit agrees that Flextronics has no responsibility whatsoever for Customer Controlled
                                         Materials that Customer has specified to be included in the Deliverables and/or Product.

 

		4.4	To
                                         the extent applicable, Kornit shall pay for or obtain and consign to Flextronics any
                                         Product-specific tooling, equipment or software necessary for the design, development,
                                         manufacture, assembly and testing of the Deliverables (collectively, the "Design
                                         Tooling"). The Design Tooling shall be considered, for all purposes of this
                                         Agreement, as Consigned Tooling and Equipment and the provisions of Section ‎9 below
                                         shall apply with respect thereto.

 

5.
Procurement of Components; Inventory Management

 

		5.1	Authorization
                                         to Procure Components. Each Purchase Order shall constitute an authorization for
                                         Flextronics to procure, without Kornit's prior approval, all Components required for
                                         the manufacture of the Products covered by such Purchase Orders, based on the applicable
                                         lead times of such Components. In addition, subject to Kornit's prior written approval,
                                         Flextronics will be entitled to procure Special Inventory required to support Kornit's
                                         Purchase Orders. To the extent Flextronics actually receives from a vendor of Components
                                         or services the benefit arising from said vendor’s warranty obligations related
                                         to its Components or services and to the extent such benefit is transferrable, Flextronics
                                         shall transfer such benefit to Kornit (without any actual liability for such vendor’s
                                         warranty obligations).

 

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		5.2	Kornit
                                         Approved Vendors; AVL. Flextronics will procure Components only from Kornit Approved
                                         Vendor List and in case Flextronics is listed on the AVL as the approved vendor for a
                                         certain Component, then such Component will be supplied by Flextronics. Kornit will provide
                                         Flextronics with an AVL for each BOM item of a Product to be manufactured. Once Kornit
                                         advises Flextronics of its selected vendors, Flextronics may not change to other vendors
                                         without Kornit's advance written approval. In no event shall Flextronics change to a
                                         vendor that does not appear on the relevant AVL without Kornit’s express prior
                                         written consent (in Kornit’s sole discretion). Any changes to the AVL by Kornit
                                         should be coordinated sufficient time in advance with Flextronics so as to minimize any
                                         adverse impact on Flextronics ability to provide the services hereunder in an efficient
                                         and competitive manner. Unless otherwise agreed, such change may be effective only with
                                         respect to Purchase Orders issued and accepted after such change is introduced and shall
                                         not apply to Components ordered prior thereto in accordance with the terms hereof.

 

		5.3	Customer
                                         Controlled Materials. Kornit may direct Flextronics to purchase Customer Controlled
                                         Materials in accordance with the Customer Controlled Materials Terms. Kornit acknowledges
                                         that the Customer Controlled Materials Terms may directly impact Flextronics's ability
                                         to perform under this Agreement and to provide Kornit with the flexibility Kornit is
                                         requiring pursuant to the terms of this Agreement. In the event that Flextronics reasonably
                                         believes that Customer Controlled Materials Terms shall create an additional cost that
                                         is not covered by this Agreement, then Flextronics shall notify Kornit and the Parties
                                         shall mutually agree to either: (i) compensate Flextronics for such additional costs;
                                         (ii) amend this Agreement to conform to the Customer Controlled Materials Terms; or (iii)
                                         amend the Customer Controlled Materials Terms to conform to this Agreement, in each case
                                         at no additional charge to Flextronics. Kornit agrees to provide to Flextronics an extract
                                         of all Customer Controlled Materials Terms upon the execution of this Agreement and promptly
                                         upon execution of any new agreements with vendors, to the extent such terms relate to
                                         Flextronics and may affect its costs and procurement activities. Kornit agrees not to
                                         make any modifications or additions to Customer Controlled Materials Terms that shall
                                         negatively impact Flextronics’s procurement activities.

 

		5.4	Inventory
                                         Management. Without derogating from the other provisions of this Agreement, Flextronics
                                         shall manage its Inventory on a first-in-first-out (FIFO) basis and in a manner that
                                         will ensure that Flextronics can fulfill its obligations hereunder.

 

		5.5	Reports.
                                         Flextronics shall provide to Kornit, within seven (7) Days of Kornit’s request,
                                         copies of electronic or written reports on current Inventory, in a standard form available
                                         at Flextronics's systems.

 

6.
Quality

 

		6.1	Kornit's
                                         standard Quality Agreement is attached hereto as Exhibit C (the "Quality
                                         Agreement"). The Quality Agreement may only be amended by mutual consent of
                                         the Parties. In case of any conflict between the Quality Agreement and this Agreement,
                                         this Agreement shall prevail.

 

		6.2	Flextronics
                                         agrees that the manufacture, test and quality control of the Products under the terms
                                         of this Agreement will be in accordance with the standards specified by the Quality Agreement.

 

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7.
Price; Cost Reduction and Payment Terms

 

		7.1	The
                                         initial fees will be agreed upon between the Parties (the "Fee List").
                                         Changes to the Fee List may only be made by mutual agreement of the Parties, such agreement
                                         not to be unreasonably withheld or delayed. If a Fee List is not completed or amended
                                         as agreed upon, then the initial fees shall be as set forth in the Purchase Orders. For
                                         each Design SOW under this Agreement the parties shall mutually agree upon a fee list.

 

		7.2	Each
                                         Fee List shall be effective for a period of [* * *]. Notwithstanding the foregoing, Flextronics
                                         may request Kornit to increase the applicable fees during the respective [* * *] period
                                         in any of the following events: (i) if the Cost of a Customer Controlled Material has
                                         been increased for any reason and no alternative Material has been approved by Kornit
                                         in order to reduce such Cost; (ii) if the respective Representative Exchange Rate has
                                         been decreased by more than [* * *] comparing to the Basis Representative Exchange Rate;
                                         (iii) if any taxes, duties, laws, rules, regulations, court orders, administrative rulings
                                         or other governmentally-imposed or governmentally-sanctioned requirements (including
                                         mandatory wage increases) result in changes to the costs of performance of any services
                                         hereunder (a "Governmental Change"); provided that such Governmental
                                         Change would have also applied if the services hereunder would have performed by Kornit;
                                         or (iv) if the production costs of the Product are otherwise increased, for any reason,
                                         provided that such increase would have also applied if the services hereunder would have
                                         performed by Kornit.

 

		7.3	Flextronics
                                                                                                                                                                                                                                                                                 agrees to use reasonable commercial efforts to reduce the cost of manufacturing Products
                                                                                                                                                                                                                                                                                 by methods such as, but not limited to: on going negotiations with suppliers during normal
                                                                                                                                                                                                                                                                                 course of business, market price reduce, elimination of Components, obtaining alternate
                                                                                                                                                                                                                                                                                 sources of Components and improved assembly or test methods. Flextronics will present
                                                                                                                                                                                                                                                                                 to Kornit any proposal for cost reduction projects and will implement such projects only
                                                                                                                                                                                                                                                                                 with the receipt of written approval of Kornit. To allow Flextronics to share in the
                                                                                                                                                                                                                                                                                 benefit of cost reduction opportunities introduced by Flextronics, during the first year
                                                                                                                                                                                                                                                                                 following the introduction of such cost reduction, [* * *] percent ([* * *]%) of the
                                                                                                                                                                                                                                                                                 amount of Flextronics initiated cost reduction will be applied to reduce the price of
                                                                                                                                                                                                                                                                                 the Products. During the second year after the introduction of such cost reduction, [*
                                                                                                                                                                                                                                                                                 * *] percent ([* * *]%) of the amount of Flextronics initiated cost reductions will be
                                                                                                                                                                                                                                                                                 applied to reduce the price of the Products purchased by Kornit. Thereafter, the [* * *] of such cost reduction will be
                                                                                                                                                                                                                                                                                 applied to reduce the price of the Products purchased                                          by Kornit [* * *].

 

		7.4	Kornit
                                         shall pay all amounts due in U.S. Dollars within [* * *] of the date of the invoice or
                                         receipt of the applicable Products.

 

		7.5	The
                                         Parties shall mutually agree whether the fees for Design Services are to be paid for
                                         by one of the following methods: (i) upfront at the start of the project, (ii) in agreed
                                         installment payments over a defined term, or (ii) some combination of (i) and (ii). The
                                         applicable method of payment shall be set out in the Fee List.

 

		7.6	All
                                         prices are net of all taxes, duties, and all other charges and any non-recurring expenses
                                         (NRE). Flextronics shall be solely responsible for its own taxes based on its revenues
                                         or property ownership, including, without limitation, municipality taxes and similar
                                         payments. Kornit shall be entitled to withhold from any payment hereunder any taxes that
                                         are required to be withheld at source under applicable laws, unless a suitable exemption
                                         is presented by Flextronics.

 

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		7.7	Kornit
                                         is responsible for additional fees and costs due to: (i) any pre-approved expediting
                                         and/or de-expediting charges reasonably necessary because of a change in Kornit's requirements;
                                         and (ii) any extension of any milestone completion schedule under the Design SOW due
                                         to Kornit requested changes.

 

		7.8	To
                                         the extent Flextronics agrees to pay any import duties, including without limitation
                                         any customs, excise, purchase tax etc., and VAT applicable on the import of Components,
                                         Kornit will promptly reimburse Flextronics for such costs. Flextronics will provide to
                                         Kornit the respective documentation evidencing and will make commercially reasonable
                                         efforts to assist Kornit in eliminating, reducing and recovering such costs under relevant
                                         laws and regulations. Flextronics will not claim reimbursement for any such costs that
                                         are timely reimbursed to Flextronics. If legally obligated, Flextronics will charge such
                                         costs as separately stated amounts on invoices in connection with the sale of Products
                                         to Kornit. For the avoidance of doubt, Flextronics is not responsible or liable in any
                                         manner for the classification or reclassification of Components or Products for import
                                         or export purposes and any risk associated therewith shall reside exclusively with Kornit.

 

		7.9	If
                                         Kornit fails to pay amounts due, Flextronics shall provide Kornit with a written notice
                                         to that effect, and allow it to cure such breach within a period of [* * *] Business
                                         Days from the date of the notice (the "Cure Period"). If Kornit does
                                         not cure this breach within the Cure Period, Kornit shall pay [* * *] percent ([* * *]%)
                                         monthly interest on all late payments as of the first Day of delay and until all outstanding
                                         amount is fully paid. Furthermore, if Kornit is (i) late with payments (and such breach
                                         is not cured within the Cure Period), or (ii) Kornit fails to timely provide Flextronics
                                         with information and/or security as required under this Section and Section ‎8 below,
                                         then Flextronics may with written notice, in its sole discretion, undertake any or any
                                         combination of the following: (a) stop all services under this Agreement (including any
                                         warranty service Flextronics would otherwise be obligated to render hereunder) until
                                         assurances of payment satisfactory to Flextronics are received or payment is received;
                                         (b) demand prepayment for Purchase Orders or Design Services; and (c) delay shipments.

 

8.
Credit Terms/Security Interest

 

		8.1	Flextronics
                                         shall provide Kornit with an initial credit limit, which shall be reviewed (and, if necessary,
                                         adjusted) periodically. Kornit shall provide information reasonably requested by Flextronics
                                         in support of such credit reviews. In Flextronics's reasonably exercised discretion,
                                         Flextronics shall have the right to reduce Kornir's credit limit and/or require Kornit
                                         to obtain and maintain a standby letter of credit or escrow account on behalf of Flextronics;
                                         in such case, the bank chosen by Kornit shall be reasonably acceptable to Flextronics,
                                         the letter of credit or escrow account shall be in force for a minimum period of time
                                         of [* * *] and shall be in an amount equal to [* * *]. The draw down procedures
                                         under the standby letter of credit or the escrow account shall be mutually agreed by
                                         Flextronics and Kornit. Flextronics shall have the right to suspend performance (e.g.,
                                         cease ordering Components required to fulfill the Purchase Orders and/or cease manufacturing
                                         or making Product deliveries and/or providing Design Services) until Kornit either makes
                                         a payment to bring its account within the revised credit limit and/or makes other arrangements
                                         satisfactory to Flextronics. Kornit agrees to promptly execute any documents reasonably
                                         requested by Flextronics to perfect and protect such security interest.

 

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9.
Consigned Tooling and Equipment

 

Upon
notice to Flextronics, Kornit shall supply the Consigned Tooling and Equipment to Flextronics. Consigned Tooling and Equipment
will be delivered to Flextronics in sufficient time and in sufficient quantities, including normal attrition levels, to allow
Flextronics to meet the respective Delivery Dates for the Products under all outstanding Purchase Orders and/or the respective
milestones under all outstanding Design SOWs. All Consigned Tooling and Equipment will be in good condition and working order.
Kornit assumes complete liability for the quality of all Consigned Tooling and Equipment and Flextronics will not be responsible
for any defects therein. Flextronics may, upon receipt of the Consigned Tooling and Equipment, perform inspections of the Consigned
Tooling and Equipment, in accordance with its standard procedures and may notify Kornit in writing, not later than seven (7) Days
from the date of receipt of the Consigned Tooling and Equipment, of any defects found or of any discrepancy in quantities. Notwithstanding
anything to the contrary under this Agreement or under applicable law, Flextronics shall not be responsible for any maintenance,
repairs or replacements of the Consigned Tooling and Equipment and shall not be responsible for any damage caused to or by the
Consigned Tooling and Equipment, other than to physical damage caused to Consigned Tooling and Equipment by Flextronics malicious
and/or grossly negligent behavior; It is further clarified and agreed that Flextronics's non-performance hereunder is excused
to the extent resulting directly and solely from the Consigned Tooling and Equipment and Flextronics's undertakings under this
Agreement are respectively conditioned.

 

10.
Forecasts

 

Kornit
will provide Flextronics a rolling forecast covering the period of [* * *] (the “Forecast”). The Forecast will
specify the number of units of the Products Kornit anticipates purchasing during such [* * *] period. The Forecast will be non-binding
and will not be regarded by either Party as a commitment to order, purchase, deliver or meet any volume commitment specified therein.
Kornit may adjust the Forecast at its reasonable discretion at any time.

 

11.
Purchase Orders

 

		11.1	During
                                         the term of this Agreement, Kornit may provide Flextronics with written purchase orders
                                         for the Products. As a matter of convenience and subject to the provisions of Section
                                         ‎11.3 below, Kornit may use its standard purchase order form for any orders provided
                                         for hereunder.

 

		11.2	Flextronics
                                         shall accept purchase orders from Kornit: (i) that comply with the provisions of this
                                         Agreement, including without limitation, that the fees reflected in each such purchase
                                         order are consistent with the Parties' then-current agreement with respect to the fees
                                         and that the delivery date requested thereunder is consistent with the Delivery Date;
                                         and (ii) that such purchase order would not extend Flextronics's financial exposure beyond
                                         Kornit's then approved credit line. Flextronics shall notify Kornit of rejection of any
                                         purchase order (only to the extent that it does not comply with the foregoing conditions)
                                         within [* * *] of receipt of such purchase order. To the extent that Flextronics
                                         does not provide Kornit any notice of rejection within the above-mentioned time frame,
                                         the purchase order shall be deemed accepted.

 

    	 	9	 

     

    

 

		11.3	The
                                         terms and conditions of this Agreement will control over any terms contained in any quotation,
                                         purchase order issued by Kornit, written acceptance or acknowledgment by Flextronics,
                                         invoice or any other form instrument exchanged by the Parties that is not clearly an
                                         amendment to this Agreement signed by both Parties and no additional, contradictory,
                                         modified or deleted terms established by such instruments are intended to have any effect
                                         on the terms of this Agreement, even if such instrument is accepted by the other Party.

 

12.
Lead Time

 

		12.1	Unless
                                         otherwise agreed upon in a Purchase Order, Flextronics agrees that the standard manufacturing
                                         lead-time for Products (other than Products manufactured at an Overseas Site) is [* *
                                         *] following the longest lead time to obtain any Component of the Product. With respect
                                         to Products manufactured at an Overseas Site the following lead time shall apply: (i)
                                         [* * *] following the arrival of all required Components and personnel to the Overseas
                                         Site with respect to the first Purchase Order issued by Kornit for Overseas Services;
                                         and (ii) [* * *] following the arrival of all required Components and personnel to the
                                         Overseas Site for any subsequent Purchase Order.

 

		12.2	If
                                         circumstances arise that prevent Flextronics from timely delivery of the Products on
                                         the Delivery Date, Flextronics will notify Kornit, immediately after it becomes aware
                                         of such circumstances, of the nature of the problem, the methods taken to overcome the
                                         problem and the estimated time of delay.

 

13.
Reschedule and Cancellation of Purchase Orders

 

		13.1	Shipment
                                         Schedule Changes 

 

(a)       For
any Purchase Order Kornit may reschedule the quantity of Products and their shipment date as provided in the table below:

 

	#
    of Days before

    Delivery Date	Maximum

    Reschedule

    Quantity	Maximum

    Reschedule

    Period (following the original Delivery Date)
	[* * *]	[*
    * *]	[*
    * *]
	[* * *]	[*
    * *]%	[*
    * *]
	[* * *]	[*
    * *]%	[*
    * *]

 

(b)       All
reschedules to push out delivery dates outside of the table in subsection (a) above require Flextronics's prior written approval,
which, in its sole discretion, may or may not be granted. If Flextronics agrees to accept a reschedule of any length of time,
and if there are extra costs to meet such reschedule, then Kornit shall be liable for such extra costs.

 

(c)       A
notice of reschedule as aforesaid may be given only once for each Product (i.e., Kornit shall be entitled to give only one notice
of reschedule for each of the Product in the Purchase Order).

 

    	 	10	 

     

    

 

(d)       For
the avoidance of doubt, any reschedule, whether authorized or not, shall not change the date on which the respective Inventory
and/or Special Inventory would otherwise become Excess Inventory, Obsolete Inventory or Aged Inventory.

 

(e)       Any
delays in the normal production or interruption in the workflow process caused by Kornit's changes to the Specifications or failure
to provide sufficient quantities or a reasonable quality level of Customer Controlled Materials where applicable to sustain the
production schedule, shall be considered a reschedule of any affected Purchase Orders for purposes of this Section for the period
of such delay.

 

		13.2	Cancellation

 

(a)       Kornit
may cancel all or any portion of Product quantity of a Purchase Order, without Flextronics's prior written approval by providing
a written notice to Flextronics at least [* * *] prior to the Delivery Date, [* * *], except as set forth in sub-section (b) below.
Any other cancellation of a Purchase Order shall be subject to Flextronics' prior written approval, which, in its sole discretion,
may or may not be granted.

 

(b)       Unless
agreed otherwise in writing between Kornit and Flextronics, upon cancellation of a Purchase Order (or any portion thereof) Kornit
shall immediately purchase from Flextronics any affected Products, Inventory and special Inventory and pay Flextronics as follows:
(i) the price listed in the then current Fee List for all affected Products (or a pro-rata proportion thereof for any applicable
partially completed Product); (ii) [* * *], (iii) [* * *], and (iv) any vendor cancellation charges incurred with respect to the
affected Inventory and Special Inventory accepted for cancellation or return by the vendor.

 

(c)       Products
that have been ordered by Kornit and that have not been picked up within [* * *] following the agreed upon Delivery Dates shall
be considered cancelled and Kornit shall be responsible for such Products in accordance with the provisions of this Section and
any risk therein shall thereupon transfer to Kornit, provided that Flextronics shall provide Kornit a notice that the Products
were not picked up. Kornit agrees that Flextronics shall have the right to invoice it for all such non-picked up Products in accordance
with the price listed in the then current Fee List and agrees to provide Flextronics, within [* * *] following the invoice, the
location to which Flextronics shall ship the Products. Flextronics may further elect, by giving Kornit [* * *] prior written notice,
to transfer such Products to a separate storage within Flextronics or to warehouse operated by a third party and to have any such
transfer considered a delivery and sale to Kornit for all intents and purposes, with title to such Products transferring thereupon
from Flextronics to Kornit.

 

		13.3	Quantity
                                         Increase

 

(a)       For
any Purchase Order Kornit may request an increase in the quantity of Products ordered (the "Increase Request").
All Product quantity increases require Flextronics’s approval, which, in its sole discretion, may or may not be granted.
Flextronics shall use reasonable commercial efforts to meet any allowed Product quantity increases, which are subject to Components
and capacity availability. If Flextronics agrees to such increase in the quantity, and if there are extra costs to meet such increase,
then Kornit shall be liable for such extra costs.

 

(b)       Notwithstanding
the foregoing, the following shall be considered as authorized Increase Requests (subject to Components availability) and no prior
approval from Flextronics shall be required: (i) an increase of up to [* * *] percent ([* * *]%) of the Purchase Order quantities
if the Increase Request has been issued by Kornit at least [* * *] prior to the Delivery Date, and (ii) an increase of up to [*
* *] percent ([* * *]%) of the Purchase Order quantities if the Increase Request has been issued by Kornit at least [* * *] prior to the Delivery Date.

 

    	 	11	 

     

    

 

14.
Kornit's Liability for Inventories

 

		14.1	By
                                         the end of each calendar quarter, Flextronics shall provide to Kornit a report listing
                                         for the end of such quarter all Aged Inventory, Excess Inventory and Obsolete Inventory
                                         (the "Quarterly Report"). Such Quarterly Report shall normally be deemed
                                         agreed to by Kornit, unless Kornit provides a reasoned written objection within thirty
                                         (30) Days following the issuance of such report by Flextronics. Kornit shall either,
                                         at Flextronics's sole discretion: (i) immediately purchase such Inventories and pay Flextronics
                                         the price listed at the then current Fee List for any finished Products, the proportionate
                                         amount of such price for any partially completed Products and Cost plus [* * *]% for
                                         any other Inventories; or (ii) pay Flextronics a monthly carrying cost fee equal to [*
                                         * *]% of the Cost of the respective Aged Inventory, Excess Inventory and Obsolete Inventory
                                         until such Aged Inventory, Excess Inventory and Obsolete Inventory is used to manufacture
                                         Products or is otherwise purchased by Kornit.

 

		14.2	In
                                         the event Kornit does not pay in accordance with the payment terms set forth above, then,
                                         in addition to any late payment charges that Flextronics is due from Kornit, Flextronics
                                         shall be entitled to dispose of such Excess, Obsolete, and Aged Inventory and Special
                                         Inventory in a commercially reasonable manner and credit to Kornit any monies received
                                         from third parties, provided that a prior written notice of [* * *] was provided to Kornit
                                         before such disposal.

 

15.
Delivery

 

		15.1	All
                                         deliveries hereunder will be made [* * *] Flextronics's applicable manufacturing site
                                         (Yavne for Products manufactured in Israel and the respective Overseas Site for Products
                                         manufactured outside Israel). Risk of loss and title shall pass to Kornit upon delivery
                                         by Flextronics of the Products to [* * *].

 

		15.2	Upon
                                         Kornit request, Flextronics will use reasonable commercial efforts (without incurring
                                         any liability or risk) to assist Kornit in arranging any desired shipping and insurance
                                         coverage (in amounts that Kornit will determine). All costs of shipping, insurance, freight,
                                         customs, duties, taxes, insurance premiums and other expenses relating to such transportation
                                         and delivery, will be at [* * *] expense.

 

		15.3	The
                                         Products shall not be packed and delivered before Flextronics conducted the delivery
                                         procedure set forth in the Specifications and received Kornit's approval. The Products
                                         shall be packed in accordance with the instructions set forth in the Specifications.

 

16.
Deliverables and Products Acceptance

 

		16.1	Deliverables.
                                         Unless agreed otherwise by the Parties, upon receipt of a Deliverable from Flextronics
                                         in accordance with the Design SOW, Kornit shall have [* * *] to accept or reject the
                                         Deliverable. If Kornit does not reject the tendered Deliverables with such time period
                                         then the Deliverables shall be deemed accepted. If Kornit determines that the Deliverable
                                         fails to satisfy the criteria for acceptance set forth in the Design Statement of Work,
                                         then, Konit may choose not to accept such Deliverable and shall provide Flextronics with
                                         a notice stating in reasonable detail the manner in which the unaccepted Deliverable
                                         failed to meet with such criteria. Upon receipt of such a notice, and if such failure
                                         is due to causes within the control of Flextronics, Flextronics shall adjust the unaccepted
                                         Deliverable and Kornit shall have an additional [* * *] within which to accept such corrected
                                         Deliverable. If such failure is due to causes outside the control of Flextronics, the
                                         Parties will agree upon the cause of such failure, the associated adjustment and the
                                         related costs. The Parties agree to repeat the procedure set forth in this Section up
                                         to [* * *] times. If after [* * *] attempts, the non-conformities and deficiencies are
                                         not corrected and Kornit determines that it wants Flextronics to continue to attempt
                                         to correct the non-conformities and deficiencies, then either: (i) the Parties will enter
                                         into a mutually agreeable change order that will allow Flextronics to be paid on a time
                                         and material basis for the ongoing work, or (ii) the affected Design Statement of Work
                                         may be terminated by Kornit or Flextronics pursuant to Section ‎25 below.

 

    	 	12	 

     

    

 

		16.2	Products.
                                         The Products delivered by Flextronics may be inspected and tested by Kornit within [*
                                         * *] of receipt at the "ship to" location on the applicable Purchase Order.
                                         Notwithstanding any prior inspection conducted at Flextronics' premises or by Flextronics
                                         (including the ATP process set forth in the Specifications), or payment made by Kornit,
                                         Kornit may reject any portion of any shipment of Products during said period if, according
                                         to inspections and tests provided for in the Specifications and conducted by Kornit,
                                         the Products do not comply with Flextronics express limited warranty set forth in Section
                                         ‎20 below. Products not rejected during said period will be deemed accepted. Any
                                         Products so returned to Flextronics will be repaired or replaced, at Flextronics' option
                                         and expense in accordance with the provisions of Section ‎20 below.

 

17.
Inspection Rights; Reports

 

		17.1	Upon
                                         request by Kornit, from time to time, and with at least [* * *] notice and during normal
                                         business hours, Flextronics will allow Kornit representatives to inspect the manufacturing
                                         and quality control, testing operations, compliance procedures and premises relating
                                         to the manufacture, assembly and testing of the Products.

 

		17.2	Upon
                                         Kornit request Flextronics shall provide Kornit with standard reports and analysis of
                                         the yields of each of the quality tests performed to the Products and shall report any
                                         defect which was discovered during such tests in the Product or in the production process
                                         within a reasonable period from the time Flextronics becomes aware of such defect.

 

		17.3	From
                                         time to time, Kornit may request reports as to the progress of the Product production
                                         in accordance with the then outstanding Purchase Order. Flextronics shall provide such
                                         reports to the extent commercially reasonable and at Kornit's sole expense, subject to
                                         its prior approval of such costs, within [* * *] from the date of Kornit's request.

 

18.
Engineering Change Order (ECO)

 

		18.1	An
                                         Engineering Change Order ("ECO") is required when the form, fit or function
                                         of the design of the Product and/or Specifications are affected. Kornit may request that
                                         Flextronics incorporate engineering changes into the Product or Specifications by providing
                                         a written description of the proposed engineering change sufficient to permit Flextronics
                                         to evaluate the feasibility and cost of the proposed change.

 

		18.2	Flextronics
                                         will provide a written response in the form of an "Engineering Change Analysis"
                                         to Kornit if such changes affect the per-unit price and/or delivery of a Product, within [*
* *].

 

 

    	 	13	 

     

    

 

		18.3	Kornit
                                         will respond with a written acceptance or rejection of the Flextronics "Engineering
                                         Change Analysis" within [* * *]. Flextronics will not implement
                                         the change to the design or Specifications of any Product or materials, equipment, manufacturing
                                         and quality assurance procedures, methods and techniques used to produce a Product, without
                                         Kornit's prior written approval.

 

		18.4	Flextronics
                                         will implement any ECO at the date mutually agreed between the Parties, provided that
                                         the Parties have agreed upon the changes to the Specifications, delivery schedule and
                                         adjustments to the Fee List and Kornit has agreed to reimburse Flextronics for all implementation
                                         costs.

 

		18.5	The
                                         cost of Inventory that becomes unusable because of an ECO and any other agreed implementation
                                         costs will be the responsibility of Kornit. Such responsibility shall be supported by
                                         documentation provided by Flextronics. The settlement between the Parties regarding such
                                         costs shall be made on a quarterly basis.

 

19.
Kornit Property

 

Any
Consigned Tooling and Equipment supplied by Kornit or procured by Flextronics at Kornit expense (the "Kornit Property")
will remain the property of Kornit and will (i) be clearly marked or tagged as the Property of Kornit, (ii) be subject to inspection
by Kornit at any time upon reasonable prior coordination, (iii) be used only for the performance of Flextronics's services hereunder,
(iv) will not be subject to any liens and encumbrances by Flextronics, and (vi) not be modified in any manner by Flextronics without
the prior written approval of Kornit. The Kornit Property shall be maintained by Kornit in accordance with Kornit's maintenance
procedures including but not limited to periodic calibration. Kornit will retain all rights, title and interest in the Kornit
Property and Flextronics agrees to treat the Kornit Property with the same degree of care as Flextronics uses with respect to
its own valuable tooling and equipment, but no less care than reasonable care. Notwithstanding anything to the contrary under
this Agreement or under applicable law, Flextronics shall not be responsible for any maintenance, repairs or replacements of the
Kornit Property. Kornit will bear all risk of loss or damage to Kornit Property while it is in Flextronics' premises and Flextronics
shall not be responsible for any damage caused to or by the Kornit Property, other than to physical damage caused to Kornit Property
by Flextronics malicious and/or grossly negligent behavior. Upon Kornit's request, Flextronics will deliver all Kornit Property
to Kornit, at Kornit expense; Kornit will determine the manner and procedure for returning the Kornit Property, and will pay the
corresponding freight costs. 

 

20.
Warranties

 

This
Section sets forth Flextronics’s sole and exclusive warranty with respect to the Products and Kornit’s sole and exclusive
remedies with respect to a breach by Flextronics of such warranty.

 

		20.1	Flextronics
                                         represents and warrants to Kornit that all work and service provided by Flextronics pursuant
                                         to this Agreement will be provided in a timely, professional and workmanlike manner.

 

Flextronics
also represents and warrants to Kornit that all Products (i) will be manufactured in accordance with the then current Specifications
and, in all material respects, with laws and regulations applicable to Flextronics’s manufacture of the Products; and (ii)
will be free from defects in workmanship for a period of [* * *] from the date of shipment (the "Warranty" and
the "Warranty Period", respectively). To the extent that the ATP (acceptance test procedures) for the Product
will be conducted by Flextronics, Flextronics Warranty shall be extended also to any defects or failures in workmanship in the
acceptance test procedures.

 

    	 	14	 

     

    

 

		20.2	Any
                                         Products that do not meet the Warranty will be repaired or replaced at Flextronics' sole
                                         option and expense or, in the event that such Product cannot be repaired or replaced
                                         using commercially reasonable efforts during the time mentioned below, Flextronics will
                                         refund to Kornit the purchase price paid by Kornit for such Product. Flextronics will
                                         repair or replace any defected Product covered by the Warranty as soon as reasonably
                                         commercially possible but not later than [* * *] of receipt by Flextronics of the returned
                                         Product; provided that (i) the Products are returned within the Warranty Period; and
                                         (ii) the failure description will accompany the Product and (iii) the root cause for
                                         the defect in question is identified, all subject to the timely availability of the Components
                                         required for the repair or replacement as the case may be. The foregoing set forth Flextronics’s
                                         sole obligation and Kornit’s sole remedy under the Warranty. Any repaired or replaced
                                         Product shall benefit from Flextronics' limited Warranty, provided however that the warranty
                                         period shall not be less than [* * *] from the date of replacement or repair.

 

		20.3	Notwithstanding
                                         anything else in this Agreement, this express limited Warranty will not apply to, and
                                         Flextronics makes no representations or warranties whatsoever with respect to any of:
                                         (i) Products that have been abused, damaged, altered or misused or mishandled (including
                                         improper storage or installation or improper handling in accordance with static sensitive
                                         electronic device handling requirements) by any person or entity after title passes to
                                         Kornit; (ii) Consigned Tooling and Equipment; (iii) Components or services provided by
                                         vendors on the AVL; (iv) defects resulting from adherence to the Specifications, or any
                                         instructions provided by or on behalf of Kornit; (v) the design of the Products; (vi)
                                         first articles, prototypes, pre-production units, test units or other similar Products;
                                         (vii) defects resulting from tooling, designs or instructions produced or supplied by
                                         Kornit, including any defective test equipment or test software provided by Kornit; or
                                         (viii) the compliance of Components or Products with any safety or Environmental Regulations
                                         or other laws. Kornit shall be liable for costs or expenses incurred by Flextronics arising
                                         out of or related to the foregoing exclusions to Flextronics’s express limited
                                         Warranty.

 

		20.4	Kornit
                                         shall return Products covered by this warranty freight prepaid after completing a failure
                                         report and obtaining a return material authorization number from Flextronics to be displayed
                                         on the shipping container. The Warranty shall not apply if Kornit has removed from Flextronics’s
                                         possession, for any reason, any tools or equipment that are necessary to repair the Products.
                                         Kornit shall bear all of the risk, and all costs and expenses, associated with Products
                                         that have been returned to Flextronics for which no defect that is covered under the
                                         Warranty has been found.

 

		20.5	Kornit
                                         shall provide any and all warranties directly to any of its end users or other third
                                         parties, and Kornit shall not pass through to end users or other third parties the warranties
                                         made by Flextronics under this Agreement. Furthermore, Kornit shall not make any representations
                                         to end users or other third parties on behalf of Flextronics, and Kornit shall expressly
                                         indicate that the end users and third parties must look solely to Kornit in connection
                                         with any problems, warranty claim or other matters concerning the Product.

 

    	 	15	 

     

    

 

		20.6	Flextronics
                                         further represents and warrants that upon delivery Kornit shall receive free, good and
                                         clear title to all Products.

 

		20.7	Flextronics
                                         will not, without the express prior written approval of Kornit, make any change to the
                                         Specifications, manufacture a Product that is not in strict compliance with its Specifications,
                                         or include in any Product any materials that have not been expressly authorized by Kornit.

 

		20.8	All
                                         delivered Products will be adequately and correctly contained, packaged, marked and labeled
                                         in accordance with Kornit's instructions as set forth in the Specifications.

 

		20.9	For
                                         the avoidance of doubt it is hereby clarified that the Warranty applies only to the manufacture
                                         of commercial quantities of the Product and shall not apply to any Deliverables manufactured
                                         by Flextronics pursuant to any Design SOW.

 

		20.10	FLEXTRONICS
                                         MAKES NO OTHER WARRANTIES, EXPRESSED OR IMPLIED, WITH RESPECT TO THE PRODUCTS OR ANY
                                         SERVICES PROVIDED UNDER THIS AGREEMENT, AND DISCLAIMS ALL OTHER WARRANTIES INCLUDING
                                         THE WARRANTIES OF MERCHANTABILITY, TITLE OR FITNESS FOR A PARTICULAR PURPOSE OR NON-INFRINGEMENT.

 

21.
Intellectual Property Ownership and Licenses

 

		21.1	As
                                         between the Parties, Kornit is and will remain the sole and exclusive owner of
                                         all title to and interest in the Kornit's Intellectual Property Rights, Products, Kornit's
                                         Confidential Information, Kornit Property, Specifications, software and all inventions,
                                         discoveries, designs, modifications, improvements, know how, derivative works that are
                                         made, developed, conceived or reduced to practice by either Kornit or Flextronics, solely,
                                         jointly or on their behalf during the term of this Agreement (collectively referred to
                                         as "Inventions"). For the avoidance of doubt, the term "Inventions"
                                         does not include any New Development, the ownership on which shall be in accordance with
                                         the provisions of Section ‎21.5 below. Kornit is and will remain the sole and exclusive
                                         owner of all title to and interest in the equipment and software provided by or on behalf
                                         of Kornit. Flextronics agrees not to remove or deface any portion of any legend provided
                                         on any software or documentation delivered to Flextronics under this Agreement. Flextronics
                                         hereby assigns any right it may have in the Invention to Kornit. Flextronics further
                                         agrees to do all things reasonably necessary to evidence and perfect Kornit's interest
                                         therein, as reasonably requested by Kornit and at Kornit's expense. In addition to the
                                         above, Flextronics will provide updated copies of all engineering drawings, specifications,
                                         design files, and any other design documents to Kornit on a quarterly basis. Flextronics
                                         represents and warrants that it shall not knowingly, directly or indirectly, through
                                         its affiliated companies, distributors, resellers or agents of any type or nature, use,
                                         implement, or disclose any of Kornit’s Inventions and Intellectual Property Rights
                                         to any third party unless Flextronics will obtain the proper license from Kornit.

 

		21.2	Flextronics's
                                         Background Property. Flextronics’s "Background Property" shall
                                         mean and include, without limitation, Flextronics’s know-how, design tools, methodologies,
                                         software, algorithms, or other means that may be used to (i) design, manufacture, assemble
                                         or test products, or (ii) design production means or the processes by which products
                                         are manufactured, assembled, or tested or any improvements or modifications thereto.
                                         Flextronics owns or has the right to use all of the Intellectual Property Rights in its
                                         Background Property which Background Property is not incorporated into the New Developments
                                         or Inventions. Kornit acknowledges and agrees that this Agreement shall not affect the
                                         ownership of, nor convey any licenses or rights under any of the Intellectual Property
                                         Rights in Flextronics’ Background Property, either expressly, impliedly or otherwise
                                         to Kornit or any other third party.

 

    	 	16	 

     

    

 

		21.3	Third
                                         Party Technology; Essential IP. Kornit shall be responsible for obtaining any necessary
                                         license or other rights and for paying any royalties or license fees in connection with
                                         any third party technology and any Intellectual Property Rights incorporated in the Deliverables
                                         or Product, and for providing adequate assurances to Flextronics, upon Flextronics’
                                         request that Kornit has secured such rights or paid such royalties or fees.

 

		21.4	Independent
                                         Work. This Agreement shall not affect the ownership of, nor convey any licenses to,
                                         any innovation, improvement, idea, method, technique or work of authorship, or any Intellectual
                                         Property Right therein, which is created during or subsequent to the term of this Agreement
                                         by a party outside the performance of the Design Services and outside the other services
                                         provided under this Agreement without reference to, or other use of, the Confidential
                                         Information of the other party (an "Independent Work").

 

		21.5	New
                                         Developments. Flextronics agrees that, upon Flextronics’s receipt of Kornit’s
                                         payment for the Design Services hereunder, all designs, plans, reports, drawings, schematics,
                                         prototypes, models, inventions, copyrights, and all other information and items made
                                         or conceived by Flextronics or by its employees, contract personnel, or agents during
                                         the course of this Agreement and incorporated into the Deliverables (the "New
                                         Developments") and all Intellectual Property Rights in the New Developments,
                                         are assigned to Kornit as its sole and exclusive property, subject only to any third
                                         party Intellectual Property Rights identified in Section ‎21.3.

 

		21.6	Subject
                                         to the terms and conditions of this Agreement, Kornit grants Flextronics a non-transferable,
                                         non-exclusive, royalty-free, revocable license for the term of this Agreement, to use
                                         Kornit's Intellectual Property Rights, Specifications and Design Specifications solely
                                         for the purpose of manufacturing the Products, manufacturing the Deliverables and otherwise
                                         perform its obligations as expressly authorized hereunder. Subject to the terms and conditions
                                         of this Agreement, Kornit grants Flextronics a non-transferable, non-exclusive, royalty-free,
                                         revocable license to use the software provided by Kornit solely for the purpose of performing
                                         its obligations as expressly authorized hereunder. The software and accompanying documentation
                                         is licensed, not sold, and Flextronics acknowledges and agrees that any transaction documentation
                                         purporting to "sell" or "transfer" the software does not convey ownership
                                         of any intellectual property rights in such software or any copies thereof. Other than
                                         this license and except as otherwise specifically provided in this Agreement, Flextronics
                                         has no rights, expressed or implied, in Kornit’s Intellectual Property Rights,
                                         Products, Kornit Property, Specifications and Design Specifications.

 

		21.7	Except
                                         as otherwise specifically provided in this Agreement, each Party acknowledges and agrees
                                         that no licenses or rights under any of the Intellectual Property Rights of the other
                                         Party are given or intended to be given to such other Party.

 

		21.8	Flextronics
                                         shall not be entitled for the Inventions to any monetary or other compensation over and
                                         above that set out expressly in this Agreement.

 

    	 	17	 

     

    

 

22.
Indemnification

 

		22.1	Indemnification
                                         by Kornit. Kornit is responsible for the design of the Products. Kornit and Flextronics
                                         hereby acknowledge and agree that: (1) the Design Services to be performed hereunder
                                         by Flextronics may be incorporated into a product, process or service to be owned or
                                         controlled by Kornit, (2) Kornit is responsible for final review, testing, and approval
                                         of all features of the Deliverables and the results of the Design Services, and (3) Kornit
                                         has provided Flextronics with data, information and/or design specifications regarding
                                         the Product and the Design Services which have been used by and relied upon by Flextronics.
                                         Accordingly, Kornit will defend, indemnify and hold Flextronics and its affiliates and
                                         all officers, directors, employees, agents, successors and assigns, harmless from and
                                         against all claims, actions, losses, expenses, damages or other liabilities, (including
                                         reasonable attorneys' fees and legal costs) (collectively, the "Damages")
                                         arising out of or in connection with a third party claim or action, whether the claim
                                         is based upon contract, tort or any other legal theory: (a) alleging that any Product
                                         or portion of a Product violates the Intellectual Property Rights of any third party;
                                         or (b) arising from or related to the distribution, sale or use of any Product or portion
                                         of a Product; or (c) relating to any failure of any Product (and Components contained
                                         therein) sold by Flextronics hereunder or any Deliverables to comply with any safety
                                         standards and/or Environmental Regulations to the extent that such failure has not been
                                         caused by Flextronics's breach of its express limited Warranty set forth in Section ‎20.1
                                         above; or (d) relating to any actual or threatened injury or damage to any person or
                                         property caused, or alleged to be caused, by a Product, but only to the extent such injury
                                         or damage has not been caused by Flextronics's breach of its express limited Warranty
                                         related to Flextronics’s workmanship and manufacture in accordance with the Specifications
                                         only as further set forth in Section ‎20.1 above; or (e) relating to a design defect
                                         or to any Consigned Tooling and Equipment.

 

		22.2	Indemnification
                                         by Flextronics. Flextronics shall, at all times indemnify, hold harmless, and defend
                                         Kornit and its affiliates, its officers, directors, employees, agents, successors and
                                         assigns (each, a "Kornit Indemnitee"), harmless from and against all
                                         Damages arising out of or in connection with a third party claim or action, whether the
                                         claim is based upon contract, tort or any other legal theory, alleging that: (i) a process
                                         that Flextronics elects to use to manufacture, assemble or test the Products infringes
                                         any Intellectual Property Right of any third party; or (ii) that by performing the Design
                                         Services Flextronics has knowingly breached the Intellectual Property Rights of any third
                                         party, in each case provided however that Flextronics shall not have any obligation to
                                         indemnify any Kornit Indemnitees if such claim arises solely due to Flextronics adherence
                                         to the Product Specifications or to the Design Specifications (as applicable).

 

		22.3	Conditions.
                                         A Party's obligation to indemnify the other under this Section ‎22 is conditioned
                                         upon and subject to: (a) the indemnified Party giving the indemnifying Party reasonably
                                         prompt notice in writing of any such charge of infringement, claim or suit and permitting
                                         the indemnifying Party through counsel of its choice, to assume the defend of such claim
                                         or suit; (b) the indemnified Party providing the indemnifying Party information, assistance
                                         and authority, at the indemnifying Party's expense, to enable the indemnifying Party
                                         to defend the suit; and (c) the indemnifying Party will not be responsible for any settlement
                                         made by the indemnified Party without its prior written consent which shall not be unreasonably
                                         withheld or delayed.

 

    	 	18	 

     

    

 

23.
Non-Solicitation

 

		23.1	Each
                                         of the Parties hereby agrees that during the term of this Agreement and for a period
                                         of [* * *] following termination of this Agreement it will not, except with the other
                                         Party's prior written approval, solicit, induce, recruit, hire or encourage any employee
                                         or consultant of the counter Party to leave such position, or attempt to do any of the
                                         foregoing, either for themselves or for any other person or entity.

 

		23.2	Nothing
                                         contained herein shall prohibit and/or prevent Flextronics from the continued conduct
                                         of its business, as it is conducted today, and as it may be conducted in future, including,
                                         without limited, from the design and/or manufacture and/or sale and/or distribution of
                                         printers including digital printers by Flextronics for Flextronics' business and/or on
                                         behalf of any third party.

 

24.
Term

 

This
Agreement will become effective on the Effective Date and will continue for a period of three (3) years (the "Initial
Term") unless terminated at an earlier date in accordance with the provisions herein set forth. This Agreement will automatically
be renewed for additional twenty four (24) months terms (each a "Renewal Term"), unless terminated by either
Party upon one hundred and eighty (180) Days written notice to the other Party prior to the end of the Initial Term or any Renewal
Term thereafter.

 

25.
Termination

 

		25.1	Either
                                         Party for cause may immediately terminate this Agreement by providing written notice
                                         to the other Party, upon the occurrence of any of the following events:

 

		(a)	If
                                         the other party ceases to do business, or otherwise terminates its business operations,
                                         excluding any situation where all or substantially all of such other party's assets,
                                         stock or business to which this Agreement relates are acquired by a third party (whether
                                         by sale, acquisition, merger, operation of law or otherwise) unless such third party
                                         is a competitor of the Party giving notice of termination; or

 

		(b)	If
                                         the other becomes insolvent, makes an assignment for the benefit of creditors, files
                                         a petition in bankruptcy, permits a petition in bankruptcy to be filed against it, presents
                                         a petition or has a petition presented by a creditor for its winding up, or enters into
                                         any liquidation or call any meeting of its creditors, or admits in writing that it is
                                         unable to pay its debts as they mature, or if a receiver or examiner is appointed for
                                         a substantial part of it's assets.

 

		25.2	Either
                                         Party shall be entitled to terminate this Agreement by written notice to the other Party,
                                         if such Party breaches any material provision of this Agreement and fails to cure such
                                         breach within [* * *] of written notice describing the breach.

 

		25.3	Kornit
                                         may terminate this Agreement for convenience upon one hundred and eighty (180) Days written notice to Flextronics.
                                         Flextronics may terminate this Agreement for convenience upon  three hundred sixty five (365) Days written notice
                                         to Kornit.

 

		25.4	Kornit
                                         may terminate the Design Services for convenience [* * *] upon written notice to
                                         Flextronics. Flextronics may terminate the Design Services  [* * *]  upon written notice
                                         to Kornit if Flextronics cannot deliver under the Design SOW due to causes beyond its
                                         control. The termination terms, including the compensation that Flextronics shall be
                                         entitled to receive in such cases with respect to the Design Services, if any, will be
                                         mutually determined in writing between the Parties and in accordance with the applicable
                                         purchase order.

 

    	 	19	 

     

    

 

26.
Effect of Termination

 

Upon
expiration of termination of this Agreement for any reason the following provisions shall apply:

 

		26.1	Flextronics
                                         will stop all work on outstanding Purchase Orders and incur no further direct costs.
                                         Kornit will have the option (solely in case of termination by Kornit for convenience)
                                         to request that Flextronics complete work in process pursuant to any Purchase Orders
                                         open on the date of termination and, in such case, Flextronics shall complete such work-in-process
                                         in accordance with the terms of the respective Purchase Order.

 

		26.2	All
                                         outstanding Purchase Orders shall be deemed cancelled and Kornit shall purchase all affected
                                         Products and Inventories and shall pay Flextronics such amounts and costs as set forth
                                         in Section ‎13.2(b) above. In addition, Kornit shall be responsible for all Excess,
                                         Aged and Obsolete Inventories in accordance with the provisions of Section ‎14 above.
                                         All payments under this Section shall be due in accordance with the payments terms set
                                         forth in Section ‎7.4 above. For the avoidance of doubt it is hereby clarified that
                                         expiration or termination of this Agreement for any reason shall not affect the amounts
                                         due under this Agreement by either Party that exist as of the date of expiration or termination.

 

		26.3	Each
                                         Party will return to the other, freight collect, all materials that contain the other's
                                         Confidential Information, including all manufacturing files of Kornit and all copies
                                         thereof and all documents or things containing any portion of any Confidential Information,
                                         or if the other Party gives written instructions to do so, destroy all such materials
                                         and copies thereof and all documents or things containing any portion of any Confidential
                                         Information, and provide the other a written certificate of destruction within thirty
                                         (30) Days after such destruction.

 

		26.4	Flextronics
                                         shall use commercially reasonable efforts to cancel without charge any outstanding purchase
                                         order with third party suppliers relating to this Agreement, unless otherwise requested
                                         by Kornit.

 

		26.5	Except
                                         as otherwise provided in this Agreement, neither Party shall be liable to the other Party
                                         hereto for damages, losses, indemnity, compensation or expenses of any kind or character
                                         whatsoever on account of the expiration or termination of this Agreement in accordance
                                         with the terms hereof, whether such damages, losses, costs or expenses arise from loss
                                         of prospective sales, or expenses incurred or investments made in connection with the
                                         establishment, development or maintenance of a Party's business, creation of goodwill,
                                         markets and customers for the Products or any other reason whatsoever. Notwithstanding
                                         anything to the contrary contained herein, expiration or termination of the Agreement
                                         shall not affect any claim, demand, liability or right of a Party arising pursuant to
                                         this Agreement prior to the expiration or termination hereof.

 

		26.6	The
                                         obligations under sections ‎20, ‎21, ‎22, ‎23, ‎26, ‎27, ‎29,
                                         ‎31, ‎34, ‎35, ‎36 and ‎37 will survive termination or expiration
                                         of the Agreement.

 

    	 	20	 

     

    

 

27.
Liability Limitation

 

NOTWITHSTANDING
ANYTHING TO THE CONTRARY UNDER THIS AGREEMENT AND/OR UNDER APPLICABLE LAW:

 

		27.1	EXCEPT
                                         WITH RESPECT TO: (I) THE PARTIES' OBLIGATIONS OF INDEMNIFICATION AS SET FORTH IN SECTION
                                         ‎22 ABOVE OR, (II) A BREACH OF EITHER PARTY'S OBLIGATIONS OF CONFIDENTIALITY HEREUNDER,
                                         OR (III) FRAUD OR FRAUDULENT MISREPRESENTATION, NEITHER PARTY WILL BE LIABLE TO THE OTHER
                                         PARTY OR ANY THIRD PARTY FOR LOSS OF, OR DAMAGE TO, OR LOSS OF USE OF, FACILITIES OR
                                         OTHER PROPERTY, BUSINESS INTERRUPTION, LOSS OF REVENUE, LOSS OF PROFITS, LOSS OF DATA
                                         OR TRANSMISSIONS, LOSS OF CUSTOMERS, OR OTHER INCIDENTAL, INDIRECT, SPECIAL, PUNITIVE
                                         OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER, RESULTING OR ARISING FROM OR RELATING
                                         TO THIS AGREEMENT AND WHETHER OR NOT THE OTHER PARTY IS ADVISED OF THE POSSIBILITY OF
                                         ANY OF THE FOREGOING.

 

		27.2	EXCEPT
                                         WITH RESPECT TO: (I) THE PARTIES' OBLIGATIONS OF INDEMNIFICATION AS SET FORTH IN SECTION
                                         ‎22 ABOVE OR, (II) A BREACH OF EITHER PARTY'S OBLIGATIONS OF CONFIDENTIALITY HEREUNDER,
                                         OR (III) FRAUD OR FRAUDULENT MISREPRESENTATION, EITHER PARTY'S CUMULATIVE LIABILITY FOR
                                         DAMAGES FOR: (A) ANY CLAIM UNDER THIS AGREEMENT OF ANY KIND WHATSOEVER, REGARDLESS OF
                                         LEGAL THEORY, AND WHETHER ARISING IN TORT OR CONTRACT (EACH, A "CLAIM");
                                         AND (B) FOR ALL CLAIMS IN THE AGGREGATE FOR A PERIOD OF [* * *], SHALL NOT EXCEED, AT
                                         ANY GIVEN TIME, [* * *]. FOR THE AVOIDANCE OF DOUBT, THE CAP SET FORTH IN THE PREVIOUS
                                         SENTENCE SHALL NOT APPLY TO LIMIT: (I) FLEXTRONICS’S WARRANTY OBLIGATIONS UNDER
                                         SECTION ‎20 ABOVE; OR (II) KORNIT’S OBLIGATION HEREUNDER FOR PAYMENTS FOR ANY
                                         DELIVERABLES, PRODUCTS, MATERIALS OR OTHER CHARGES.

 

28.
Relationship of Parties

 

Flextronics
and its subcontractor(s) will be deemed to be independent contractors of Kornit, and this Agreement does not create a general
agency, joint venture, partnership, employment relationship, or franchise between Flextronics and Kornit. Each Party assumes full
responsibility for the actions and negligence of its employees, agents or other personnel assigned by it to perform work pursuant
to this Agreement, regardless of their place of work, and will be solely responsible for payment of salary, including withholding
of federal and state income taxes, social security, workers' compensation and the like.

 

    	 	21	 

     

    

 

29.
Confidentiality

 

		29.1	Definition.
                                         "Confidential Information" means: (i) the existence and terms of this
                                         Agreement except that the existence of this Agreement may be disclosed for purposes of
                                         enforcing the Agreement pursuant to Section ‎31 below; (ii) all information concerning
                                         the fees or costs for Products and Inventory other than Customer Controlled Materials;
                                         and (iii) all information, whether written or oral, and in any form (including, without
                                         limitation, engineering documents, research and development, manuals, reports, drawings,
                                         plans, flowcharts, software (in source or object code), program listings, data file printouts,
                                         printed circuit boards, processes, trade secrets, inventions, mask works, ideas, processes,
                                         formulas, source and object codes, data, programs, other works of authorship, know-how,
                                         improvements, discoveries, developments, designs and techniques, information regarding
                                         plans for research and development, component part listings and prices, product information,
                                         marketing and selling plans, business plans, new product plans, budgets and unpublished
                                         financial statements, licenses, prices and costs, suppliers and customers, and information
                                         regarding the skills and compensation of employees or consultants of the) relating to
                                         a Party's business or technology which is disclosed by a Party either directly or indirectly
                                         to the other party. In particular, but without limitation, the Specifications and the
                                         Product components delivered to Flextronics by Kornit will be the Confidential Information
                                         of Kornit and the information related to Flextronics's subcontractors, including as listed
                                         in Exhibit E hereto, will be the Confidential Information of Flextronics.

 

		29.2	Non-disclosure
                                         and Non-use. Each Party hereto (the “Receiving Party”) agrees
                                         not to use any Confidential Information of the other Party (the “Disclosing
                                         Party”) for any purpose, other than to enforce its rights and perform its obligations
                                         hereunder, or disclose any Confidential Information of the other Party to any third party
                                         for any purpose. Each Party hereto shall use at least the same degree of care, but no
                                         less than reasonable care, to avoid disclosure or use of the Confidential Information
                                         of the other party as such party employs with respect to its own Confidential Information
                                         of like importance. Without limitation of the foregoing, each party agrees during the
                                         term of this Agreement and thereafter to hold such Confidential Information in strict
                                         confidence, not to disclose it to third parties or to use it in any way, commercially
                                         or otherwise, except as otherwise expressly authorized by this Agreement, and not to
                                         allow any unauthorized person access to such Confidential Information, either before
                                         or for a period of three (3) years after termination or expiration of this Agreement,
                                         without the prior written consent of the Disclosing Party. Each Party will limit the
                                         disclosure of the Confidential Information to employees with a need to know who: (i)
                                         have been advised of the confidential nature thereof and (ii) are parties to written
                                         agreements no less restrictive than this Section ‎29.2 as to the non-disclosure and
                                         non-use of such Confidential Information.

 

		29.3	Exceptions.
                                         Notwithstanding anything in this Agreement to the contrary, Confidential Information
                                         need not be treated as such if it is or has become:

 

		(a)	published
                                         or otherwise available to the public other than by a breach of this Agreement;

 

		(b)	rightfully
                                         received by the Receiving Party from a third party without confidential limitation;

 

		(c)	approved
                                         in writing for public release by the Disclosing Party;

 

		(d)	known
                                         to the Receiving Party prior to its first receipt of such Confidential Information from
                                         the Disclosing Party, as properly documented by the Receiving Party's files; or

 

		(e)	independently
                                         developed by the Receiving Party without use of or reference to such Confidential Information,
                                         as properly documented by the Receiving Party's files.

 

    	 	22	 

     

    

 

		29.4	Notwithstanding
                                         anything to the contrary herein, Receiving Party is free to make (and this Agreement
                                         does not restrict) disclosure of any Confidential Information to the extent legally required
                                         under mandatory applicable law in a judicial, legislative or administrative investigation
                                         or proceeding or otherwise; provided, however, that, to the extent permitted by law,
                                         Receiving Party provides to Disclosing Party prior written notice of the intended disclosure
                                         and permits Disclosing Party to intervene therein to protect its interests in the Confidential
                                         Information. In addition and notwithstanding anything in this Agreement to the contrary,
                                         Receiving Party may make any public disclosure to the extent legally required under the
                                         mandatory requirements of The NASDAQ Stock Market, the Securities Act of 1933, as amended,
                                         the Securities Exchange Act of 1934, as amended, or any other securities legislation
                                         (including any applicable stock exchange rules); provided however that, to the extent
                                         permitted by applicable law, Receiving Party provides to Disclosing Party prior written
                                         notice of the intended disclosure, reasonable time in advance so that the Parties are
                                         able to coordinate and cooperate for the purpose thereof.

 

		29.5	Return
                                         of Confidential Information. Upon the termination or the expiration of this Agreement,
                                         each Party shall: (i) return to the other Party or destroy, as requested by the Disclosing
                                         Party, the original and all copies of any Confidential Information of the Disclosing
                                         Party and any summaries or analyses thereof or studies or notes thereon in the Receiving
                                         Party's possession or control; and (ii) at the Disclosing Party's request, have one of
                                         the officers of the Receiving Party certify in writing that: (x) it shall not make any
                                         further use of such Confidential Information of the Disclosing Party; (y) it shall comply
                                         with the terms of this Section ‎29.4 regarding prohibited use of Confidential Information
                                         of the Disclosing Party; and (z) it has fully complied with the provisions of this Section
                                         ‎29.

 

		29.6	Remedies.
                                         The Parties recognize and acknowledge that Confidential Information may have competitive
                                         value and be of a confidential nature and that irreparable damage might result to the
                                         Disclosing Party if such Confidential Information were improperly disclosed by a Receiving
                                         Party to a third party. Each party agrees that monetary damages would be inadequate to
                                         compensate the other for breach of any provision of this Section ‎29, that any such
                                         breach or threatened breach will cause irreparable injury, and that, in addition to any
                                         other remedies available at law or in equity, the injured party will be entitled to injunctive
                                         relief against the threatened breach or the continuation of any such breach.

 

		29.7	Survival.
                                         The obligations of confidentiality and limitations of use, disclosure, and access set
                                         forth herein shall survive the termination of this Agreement for a period of three (3)
                                         years from the date of such termination.

 

30.
Force Majeure

 

Neither
Party will be liable or be deemed to be in default of this Agreement for delay in performance or nonperformance of any of obligations
hereunder, in whole or in part (other than a payment obligation), if such performance is rendered impracticable by the occurrence
of any contingency or condition beyond the control of non-performing Party, including without limitation war, sabotage, embargo,
riot or other civil commotion, failure or delay in transportation, act of any government or any court or administrative agency
thereof (whether or not such action proves to be invalid), labor dispute or strike (whether or not involving the non-performing
Party's employees), accident, acts of God, fire, explosion, flood, earthquake, or other casualty, shortage of labor, fuel, energy,
raw materials, supply of components from any source, or machinery or technical failure. If a Party is not able to perform due
to such force majeure within ninety (90) Days after such event, the other Party may terminate this Agreement.

 

    	 	23	 

     

    

 

31.
Governing Law; Disputes Resolutions

 

		31.1	The
                                         laws of the State of Israel will govern this Agreement, excluding any conflicts of laws
                                         principles, except to the extent there may be any conflict between the law of the State
                                         of Israel and the Incoterms of the International Chamber of Commerce, 2010 edition, in
                                         which case the Incoterms shall be controlling. The Parties hereby consent to the personal
                                         and exclusive jurisdiction and venue of the applicable courts of Tel Aviv.

 

		31.2	Notwithstanding
                                         the foregoing, except with respect to enforcing claims for injunctive or equitable relief,
                                         any dispute, claim or controversy arising out of or relating in any way to this Agreement,
                                         any other aspect of the relationship between Flextronics and Kornit or their respective
                                         affiliates and subsidiaries, the interpretation, application, enforcement, breach, termination
                                         or validity thereof (including, without limitation, any claim of inducement of this Agreement
                                         by fraud and a determination of the scope or applicability of this agreement to arbitrate),
                                         or its subject matter (collectively, "Disputes") shall be determined
                                         by binding arbitration before one arbitrator. The arbitration shall be administered under
                                         the Israeli Arbitration Law in accordance with Substantive Israeli Law. The arbitrator
                                         shall be a retired District Court judge. The identity of the arbitrator shall be mutually
                                         agreed upon, and if the Parties are unable to agree upon an arbitrator, the arbitrator
                                         shall be determined by the President of the Israeli Bar at the request of any party hereto.
                                         The arbitration shall be held in Tel-Aviv, Israel, and it shall be conducted in the Hebrew
                                         language. The parties shall maintain the confidential nature of the arbitration proceeding
                                         and any award, including the hearing, except as may be necessary to prepare for or conduct
                                         the arbitration hearing on the merits, or except as may be necessary in connection with
                                         a court application for a preliminary remedy, a judicial challenge to an award or its
                                         enforcement, or unless otherwise required by law or judicial decision. Judgment on any
                                         award in arbitration may be entered in any court of competent jurisdiction. Notwithstanding
                                         the above, each party shall have recourse to any court of competent jurisdiction to enforce
                                         claims for injunctive and other equitable relief.

 

		31.3	IN
                                         THE EVENT OF ANY DISPUTE BETWEEN THE PARTIES, WHETHER IT RESULTS IN PROCEEDINGS IN ANY
                                         COURT IN ANY JURISDICTION OR IN ARBITRATION, THE PARTIES HEREBY KNOWINGLY AND VOLUNTARILY,
                                         AND HAVING HAD AN OPPORTUNITY TO CONSULT WITH COUNSEL, WAIVE ALL RIGHTS TO TRIAL BY JURY,
                                         AND AGREE THAT ANY AND ALL MATTERS SHALL BE DECIDED BY A JUDGE OR ARBITRATOR WITHOUT
                                         A JURY TO THE FULLEST EXTENT PERMISSIBLE UNDER APPLICABLE LAW. To the extent applicable,
                                         in the event of any lawsuit between the parties arising out of or related to this Agreement,
                                         the parties agree to prepare and to timely file in the applicable court a mutual consent
                                         to waive any statutory or other requirements for a trial by jury.

 

32.
Subcontractors

 

Except
to the subcontractors listed on Exhibit E hereto or as otherwise expressly set forth in this Agreement, Flextronics
shall not without the express prior written consent of Kornit engage any third party subcontractor or agent to perform any part
of its obligations under this Agreement or for the manufacturing of the whole or part of any Product. To the extent that Flextronics
is permitted by Kornit to subcontract Flextronics shall: (i) only subcontract to a subcontractor that first agrees in writing
to be bound by confidentiality obligations that are at least as restrictive as those set forth herein with respect to Confidential
Information; and (ii) remain liable and responsible for any act or omission of a subcontractor that would constitute a breach
of this Agreement if said act or omission were performed by Flextronics.

 

    	 	24	 

     

    

 

33.
Assignability

 

This
Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors, assigns and legal
representatives. Neither party shall have the right to assign or otherwise transfer its rights or obligations under this Agreement
except with the prior written consent of the other Party, not to be unreasonably withheld. Notwithstanding the aforementioned,
each Party may assign this Agreement to any of its Affiliates; provided that the respective assignee agrees to be bound by all
terms and conditions of this Agreement and further provided that such assignee is not a direct competitor of the other Party.
"Affiliates" shall mean, with
respect to any Party, any corporation, partnership, joint venture or other legal entity that a Party to this Agreement controls,
is controlled by, or is under common control with, where "control" means the ownership of more than fifty percent (50%)
of the voting equity in such entity or otherwise the ability to direct the management of such entity. 

 

34.
Notice

 

All
notices required or permitted under this Agreement shall be in writing and shall be deemed received (a) when delivered personally;
(b) when sent by confirmed facsimile or email; (c) five (5) Days after having been sent by registered or certified mail, return
receipt requested, postage prepaid; (d) when acknowledged as received via email; or (e) two (2) Days after deposit with a commercial
overnight carrier. All communications shall be sent to the addresses set forth above or to such other address as may be designated
by a Party by giving written notice to the other Party pursuant to this Section.

 

35.
No Waiver

 

No
waiver of any term or condition of this Agreement will be valid or binding on either Party unless the same will have been mutually
assented to in writing by an officer of both Parties. The failure of either Party to enforce at any time any of the provisions
of the Agreement, or the failure to require at any time performance by the other Party of any of the provisions of this Agreement,
will in no way be construed to be a present or future waiver of such provisions, nor in any way affect the validity of either
Party to enforce each and every such provision thereafter.

 

36.
Severability

 

In
the event that any provision of this Agreement is found to be entirely or partially invalid, illegal, or unenforceable, the validity,
legality, and enforceability of any of the remaining provisions will not in any way be affected or impaired and a valid, legal,
and enforceable provision of similar intent and economic impact will be substituted therefore.

 

37.
Entire Agreement

 

This
Agreement consists of the terms and conditions stated above, including the Exhibits, is the entire Agreement between the Parties.
This Agreement supersedes all proposals, oral or written, all negotiations, conversations, or discussions between or among Parties
relating to the subject matter of this Agreement and all past dealing or industry custom. Any term, condition or other provision
in any Purchase Order, quotation, confirmation, document, or other oral or written communication that is in any way inconsistent
or in conflict with or in addition to Agreement will be void and is hereby expressly rejected by Kornit, unless agreed upon in
writing and signed for and on behalf of both Parties. In the event of any conflict between this Agreement and any other exhibit
thereto, this Agreement shall control.

 

    	 	25	 

     

    

 

38.
Insurance 

 

		38.1	Each
                                         Party agrees to maintain appropriate insurance policies to cover such Party’s respective
                                         risks and liabilities in connection with this Agreement and for its duration. With regards
                                         to Products Liability insurance only Kornit shall continue to renew the certificate of
                                         insurance for a period of [* * *] following termination of this Agreement.

 

		38.2	Upon
                                         request each Party shall furnish certificates of insurance attached as Exhibit
                                         F within thirty (30) Days from the date such a request has been provided and
                                         shall address the certificate of insurance to the party.

 

		38.3	Kornit
                                         has the right to avoid from purchasing Burglary coverage as per Exhibit F however
                                         Kornit exempts Flextronics and/or its parent company and/or subsidiary and/or affiliated
                                         company and/or managers and/or employees from and against any loss or damage that would
                                         have been covered (in the absence of a deductible) should Kornit had purchased the burglary
                                         coverage to the full sum insured.

 

		38.4	Flextronics
                                         shall use reasonable commercial efforts to extend the insurance coverage under its General
                                         Third Party and Product Liability Insurance to include also USA and Canada which are
                                         currently excluded.

 

		38.5	For
                                         the avoidance of doubt it is hereby clarified that the absence of appropriate insurance
                                         coverage by either Party shall not derogate from such Party's liabilities under this
                                         Agreement.

 

39.
Use of Flextronics or Kornit Name is Prohibited 

 

Neither
Party may use the other Party’s name or identity or any other Confidential Information in any advertising, promotion or
other public announcement (other than to the extent legally required under the mandatory requirements of The NASDAQ Stock Market,
the Securities Act of 1933, as amended, the Securities Exchange Act of 1934, as amended, or any other securities legislation (including
any applicable stock exchange rules) without the prior express written consent of the other Party.

 

40.
Counterparts and Exchange of Signatures

 

This
Agreement may be executed in counterparts. The Parties agree that electronically transmitted and reproduced signatures (including
faxed pages, scanned copies of signatures and email acknowledgements) constitute acceptable exchange of authentic consent to the
terms and conditions of this Agreement.

 

41.
Set-off

 

Amounts
due in connection with this Agreement by either Party to the other Party may not be set off except with the other Party's prior
written consent.

 

    	 	26	 

     

    

 

IN
WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year, first above written.

 

	Kornit
    Digital Ltd.:	 	Flextronics
    (Israel) Ltd.:
	 	 	 	 	 
	Signed:	/s/
    Gabi Seligsohn	 	Signed:	/s/
    Ziv Sin-Malia
	 	 	 	 	/s/
    Uri Bechor
	 	 	 	 	 
	Print
    Name:	Gabi
    Seligsohn	 	Print
    Name:	Ziv
    Sin-Malia
	 	 	 	 	Uri
    Bechor
	Title:	CEO	 	Title:	Finance
    Manager
	 	 	 	 	VP,
    Operation
	 	 	 	 	 
	/s/
    Guy Avidan	 	 	 
	Guy
    Avidan	 	 	 
	CFO	 	 	 

 

    	 	27	 

     

    

 

EXHIBIT
A - PROGRAM TEAM LIST

 

	Dept	Title	Name	Phone
    Number	E-Mail
	[*
    * *]	[*
    * *]	[*
    * *]	[*
    * *]	[*
    * *]
	[*
    * *]	[*
    * *]	[*
    * *]	[*
    * *]	[*
    * *]
	[*
    * *]	[*
    * *]	[*
    * *]	[*
    * *]	[*
    * *]
	[*
    * *]	[*
    * *]	[*
    * *]	[*
    * *]	[*
    * *]

 

    	 	A-1	 

     

    

 

EXHIBIT
B - CONSIGNED TOOLING AND EQUIPMENT

 

[*
* *]

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    	 	B-1	 

     

    

 

EXHIBIT
C – QUALITY AGREEMENT

 

		 

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KORNIT
Engineering Specification

 

KORNIT’S
SUPPLIER QUALITY

REQUIREMENTS DOCUMENT

(SQRD)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

	Rev	Description	Sheet	Author	Approved	ECO	Date
	A	Released	 	Shimon
    H.	 	 	12/09/14
	A1	Updated
    (Flextronics)	 	Shimon
    H.	 	 	02/04/15

 

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	1 Definitions	 	5
	2 General	 	6
	3 Introduction	 	6
	3.1	 	Overview of Quality Program	 	6
	3.2	 	Supplier Quality Policy	 	6
	3.3	 	Supplier Organization	 	6
	4 Manufacturing Qualification and Process Control	 	7
	4.1	 	Manufacturing Process Qualification	 	7
	4.1.1	 	Manufacturing Process Qualification Approval	 	7
	4.2	 	Manufacturing Process Documentation		7
	4.3	 	Manufacturing Process Measurements	 	8
	4.4	 	Manufacturing Test Plan	 	8
	4.5	 	First Artical Inspection - FAI	 	8
	4.5.1	 	General Requirements	 	8
	4.6	 	Sub-Tier Procurement Requirements	 	9
	4.6.1	 	Sub-Contractor and Material Supplier Selection	 	9
	4.6.2	 	Subcontractor and Material Supplier Monitoring	 	9
	4.7	 	Supplier Outgoing Quality Control	 	9
	4.8	 	Product Identification and Lot Traceability	 	10
	4.9	 	Defective Products	 	10
	4.9.1	 	Root Cause Analysis and Corrective Action	 	10

 

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	5 Process / Product / Engineering Change Controls	 	11
	5.1	 	Control of Parts	 	11
	5.2	 	Document Control	 	11
	5.3	 	Supplier Change Notification to KORNIT	 	11
	5.3.1	 	Re-qualification:	 	11
	5.4	 	Supplier Engineering Change (EC) Process Control Requirements	 	11
	5.5	 	Supplier Process Control Requirements	 	12
	5.6	 	Engineering and Process Documentation Requirements	 	12
	5.6.1	 	Tooling Documentation Requirements	 	12
	6 Acceptance of Final Product by KORNIT	 	12
	6.1.1	 	Part to Print	 	12
	6.1.2	 	Defective Products	 	12
	6.2	 	On-Site Support	 	12
	6.3	 	Exception Shipment Approval Process	 	12
	7 Stopship / Stop Build Procedures	 	13
	7.1	 	Quality Problem Notification to KORNIT	 	13
	7.2	 	Problem Communication	 	13
	7.3	 	Problem Resolution	 	13
	7.4	 	Product Disposition	 	13
	8 Quality Goals, Continuous Improvement and Reporting	 	14
	8.1	 	Quality Goals / Commitments	 	14
	8.2	 	Continuous Improvement	 	14
	8.2.1	 	Quality Techniques	 	14
	8.3	 	Quality Reporting	 	14
	8.3.1	 	Periodic Summary Reporting	 	14
	8.3.2	 	Quality Metric Listing	 	14

 

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	9 Audits	 	15
	9.1	 	Audits and Inspection by KORNIT	 	15
	9.2	 	Subcontractor Audit	 	15
	9.3	 	Supplier Self Audits	 	15
	10 Quality Records	 	15
	11 Standard Compliance Requirements	 	16
	11.1	 	External Standard Requirements	 	16
	11.1.1	 	ISO 9000	 	16
	11.2	 	KORNIT Standards Requirements	 	16
	11.2.1	 	Environmental Requirements	 	16
	11.2.2	 	Shipping to KORNIT and Authorized Third Par	 	16
	12 Equipment Control	 	17
	12.1	 	Calibration Requirements	 	17
	12.2	 	Equipment Maintenance	 	17
	12.3	 	New Equipment Capability	 	17
	12.4	 	ESD	 	17
	13 Training and Workmanship	 	18
	13.1	 	General Requirements	 	18
	13.2	 	Training Certification	 	18
	13.3	 	Workmanship	 	18
	14 IT Toolsets	 	18
	15 KORNIT’s Qualification of Products	 	19
	16 Related Documents	 	19
	16.1	 	Product Quality Addendum (PQA)	 	19
	16.2	 	Supplier Quality Document (sQd)	 	19
	17 Acronyms	 	20

 

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1  Definitions

 

Agreement
– shall mean that certain Manufacturing
Services Agreement between Supplier and KORNIT dated __________, 2015.

 

Bill
of Materials or BOM - as such term is defined
in the Agreement.

 

KORNIT
– shall mean Kornit Digital Ltd.

 

KORNIT
Sourced Material - shall mean parts, materials
or services that are listed on a BOM that has KORNIT as the source of such materials.

 

Customer
- shall mean KORNIT’s end customer
for the Product.

 

Defective
Product or
Non-Conformance Material - shall mean
any Product that fails to comply with the Specifications as set forth in Supplier's limited warranty under the Agreement.

 

Document
- shall mean this Supplier Quality Requirements
Document and any items that are incorporated by reference into this document.

 

Engineering
Change Order - as such term is defined in
the Agreement

 

Key
Contact List - shall mean Supplier’s
contacts for business, quality and technical issues, their name, address, e-mail address, phone number and emergency phone number(s).

 

Materials
- shall mean Components (as such term is
defined in the Agreement).

 

Material
Suppliers – shall mean suppliers or
vendors of Materials. 

 

Product
- as such term is defined in the Agreement.

 

Product
Quality Addendum- shall mean an optional
document, provided to Supplier from KORNIT and agreed in writing by Supplier, that sets forth specific quality requirements for
a Product including technical, and/or quality goals, and any exceptions to this Document.

 

Supplier
Quality Document - shall mean an optional
document, provided by Supplier to KORNIT and agreed in writing by Supplier that documents Supplier’s commitments and methods
to meet all quality requirements of this Document and the Product Quality Addendum; KORNIT Approved Waivers / Specification exceptions
and the Supplier’s Quality and Reliability Commitments.

 

Specification
- shall mean the document or set of documents
that are mutually agreed by the parties that describe the product to be produced and all associated requirements for that Product.

 

Subcontractor
- shall mean suppliers that perform manufacturing
related services for the Supplier as part of Supplier’s production of the Product.

 

Supplier
- shall mean Flextronics (Israel) Ltd.

 

Acronyms
used in this agreement are described in Section 17 of this Document.

 

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2  General

 

	●	Order of Precedence:

In
the event of any conflict or inconsistency between this Document and the Agreement, the terms in the Agreement shall prevail.
For any documents that are incorporated by reference into this Document, in the event of an inconsistency, this Document shall
have priority. If this Document contemplates future writings between the parties to establish the specifics of a quality program
for a Product or set of products, that later writing shall have precedence over this Document (but not over the Agreement). If
any Definitions set forth in Section 1 above are also defined in the Agreement the definition(s) contained in the Agreement shall
have priority.

 

	●	Exceptions:

Any
agreed exceptions to this Document will be set forth in the Product Quality Addendum, Supplier Quality Document or equivalent.

 

	●	Confidentiality:

All
information requested hereunder and all access to Supplier’s or any Subcontractor's or Material Supplier's facilities, plans
and processes shall be deemed to be Confidential Information (as such term is defined in the Agreement) of the respective disclosing
party, unless agreed otherwise in writing between the parties.

 

	●	Waiver:

Any
waiver contemplated by this document shall require the respective party's approval.

 

	●	Warranty:

Supplier's
warranty for the Products shall be only as set forth in the Agreement. Notwithstanding anything to the contrary under this Document,
such warranty shall not apply to any Materials or services provided by any Subcontractor or Materials Supplier.

 

3  Introduction

 

3.1  Overview
of Quality Program

 

This
Document outlines the minimum quality and process requirements for supplying Products to KORNIT. These Products shall be manufactured
to meet the mutually agreed Specification. Supplier shall have a quality program that exercises control over its manufacturing
process and reasonable commercial control over its Subcontractors and Material Suppliers to comply with the requirements of this
Document and the Agreement.

 

Quality
will be measured on a continuous basis and will be reported to KORNIT in accordance with a schedule and in a format that is mutually
agreed upon. Business and process controls will be required to prevent incidences of Defective Product from reaching KORNIT or
its Customers. All quality related problems will require analysis, cause determination and corrective action as defined herein.
Supplier's process controls must be demonstrated. Supplier shall drive continuous improvement to reduce defects over time in accordance
with annual goals that will be mutually agreed upon.

 

3.2  Supplier
Quality Policy

 

The
Supplier shall have a quality policy and documented quality program in support of its design and manufacturing operations which
meets the minimum requirements of this Document.

 

3.3  Supplier
Organization

 

As
part of the documented quality program, Supplier shall provide a Key Contact List. Supplier shall promptly notify KORNIT of any
changes to the Key Contact List.

 

3.4  Business
Continuity

 

The
parties may agree on a business continuity plan which would allow for the safeguarding, storage and recovery of engineering drawings,
electronic media, and production tooling in the event of damage or loss. This plan should also contain contingency plans to satisfy
KORNIT requirements in the event of significant utility interruptions, labor shortages, equipment failure and field returns.

 

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4  Manufacturing
Qualification and Process Control

 

Supplier’s
documented quality program shall include Product or process qualification plans for each Product.

 

4.1  Manufacturing
Process Qualification

 

Unless
a waiver is issued, all Product shipments must be produced using the approved Product or process qualification plan.

 

KORNIT
reserves the right to qualify the Supplier’s process. For processes qualified by KORNIT, Supplier shall not make any changes
without KORNIT’s prior written approval, which shall not be unreasonably withheld. The Supplier shall have a defined methodology
for integrating new processes and process changes into Supplier's operations. This methodology shall include as a minimum the
following:

 

	 	1.	The number and duration of consecutive successful trials required prior to declaring the process qualified
		2.	The
                                         potential effect of the new process or alteration on other required manufacturing operations
                                         (including those subcontracted)
	 	3.	The
expected timetable for updating quality plans, flow charts, maintenance files, operator training plans, etc.
	 	4.	Ensuring
related tooling is qualified as part of the process
	 	5.	The
timing of the qualification process

 

Prior
to a Product being purchased by KORNIT and as part of a Specification or other requirements document, KORNIT may provide additional
qualification requirements for that Product’s qualification. Upon Supplier’s written agreement with those additional
requirements, those additional requirements must be demonstrated.

 

4.1.1  Manufacturing
Process Qualification Approval

 

Products
produced for KORNIT or its customers must have a documented qualification plan. That plan must be mutually agreed by KORNIT and
Supplier prior to qualification testing. Test results shall be provided to both parties promptly and in a format mutually agreed
upon. In case of special test requirements, extra charge may be applied.

 

4.2   Manufacturing
Process Documentation

 

The
manufacturing process from receipt of purchased/consigned Materials to shipment of Product shall be documented and be made available
to KORNIT upon request.

 

This
shall include, but not be limited to the following:

 

1.       Receipt
and inspection of incoming Materials

2.       Fabrication
and/or assembly operations

3.       Process
work instructions

4.       In-process
inspections and tests

5.       Final
inspections and tests

6.       Packaging,
handling, storage, and shipment of product

7.       In-line
fall-out/rework

8.       Failure
analysis and closed loop corrective action

9.       Stop
Ship / Stop Build Process

 

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4.3   Manufacturing
Process Measurements

 

Supplier
shall establish manufacturing process measurements. Measurement collection and reporting methodology shall be documented. Critical
process parameters will be mutually agreed by KORNIT and Supplier. For any purchases using Supplier’s published specifications,
the agreed upon parameters shall constitute part of the Specification even if they are not included in Supplier’s published
specification. The method used to detect, flag and contain product exhibiting defects or characteristics that may cause higher
than normal failure rate than mutually agreed upon, shall be included in the process metric definitions.

 

4.4   Manufacturing
Test Plan

 

The
Supplier shall develop a Product test/conformance plan to measure conformance with the mutually agreed Specifications. Requirements
for on-going Product test in accordance with the test plan will be mutually agreed by the parties. In case Kornit shall request
Supplier to prepare the test plan, such service shall be priced separately.

 

4.5  First
Article inspection - FAi

 

As
a minimum, a First Article Inspection (FAI) is required to initially qualify a part/process for KORNIT's approval, unless the
PPAP process (below) is used instead. Furthermore, a new FAI may be requested if there is an extended gap of time since last production.
The FAI requires that all features and characteristics on the design specification and control plan be inspected and verified
prior to production. Actual measured values shall be recorded as opposed to general statements of conformance or other notations
simply indicating acceptance.

 

In
addition to an FAI, Suppliers shall, as a minimum, develop a control plan by identifying special product and process characteristics
that are key to achieving quality. The Supplier shall also include those special characteristics mutually agreed between KORNIT
and Supplier in the drawing, specification, or contract. Any request by KORNIT for additional characteristics shall be at KORNIT's
expense.

 

4.5.1   General
Requirements

 

Elements
of an acceptable process for a First Article include:

 

	 	●	Measurement,
to the agreed upon specifications
		●	Identification
                                         and inspection of Materials from receipt through processing, final inspection, and shipment

		●	Thorough
                                         and complete final inspection of the " a First Article " with recording of
                                         the actual numerical measurements

		●	Retention
                                         of written " a First Article Inspection" reports, test samples or coupons,
                                         certifications, and all other inspection records

 

The
acceptance tests shall be conducted in accordance with Supplier's acceptance process and the requirements set forth in the FAI.
Supplier may charge KORNIT with additional fee for any requirement not included in the FAI.

 

KORNIT
reserves the right to conduct, and / or review results of Supplier’s First Article Inspection on the first quantity of Product
built following an approved change. Supplier shall perform failure analysis and take corrective action in accordance with the
Agreement for all defects in workmanship found during the first "a First Article" build.

 

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4.6  Sub-Tier
Procurement Requirements

 

Supplier
shall manage its Material Suppliers and Sub-contractors (where not specified by KORNIT), by methods that include, but are not
limited to the following and in consideration for the agreed upon fees:

 

	 	●	Managing supplier selection
	 	●	Managing qualification, and quality management.
	 	●	Performing ongoing assessments of supplier capabilities.
	 	●	Driving sub-tier supplier continuous process improvement.
	 	●	Environmental compliance (See Section 11.2.1)

 

To
the extent Supplier actually receives from a vendor of Materials or services the benefit arising from said vendor’s warranty
obligations related to its Materials or services and to the extent such benefit is transferrable, Supplier shall transfer such
benefit to KORNIT (without any actual liability for such vendor’s warranty obligations).

 

The
Supplier shall not procure any Materials or services from sources other than those sources agreed upon during the part/product
qualification, unless approved in writing by KORNIT. Unless specifically agreed otherwise in the approval, KORNIT reserves the
right to limit or rescind any alternative source approval at any time and Supplier shall promptly adjust future sourcing to the
approved source and take commercially reasonable efforts to stop receipt of additional Materials from other sources. If KORNIT
agrees, Supplier may use the approved alternative source material until it exhausts any inventory or non-cancelable orders placed
with the alternative source. If KORNIT does not agree to continued use such Material shall be considered an Obsolete Inventory
(as such term is defined in the Agreement) for all purposes set forth in the Agreement.

 

4.6.1   Sub-Contractor
and Material Supplier Selection

 

For
all Subcontractors and Material Suppliers that are not specified by KORNIT for use in production of the Product, the Supplier
shall establish a sub-tier supplier quality management program which includes all elements of this Document. Suppliers' selection
process shall include, but is not limited to the following: financial performance, competitiveness, technology offerings, capabilities
assessment and SCSR performance. Sub-tier survey results and sub-tier management process assessments should consider the following
aspects of sub-tier supplier capabilities: engineering support, supplier selection, AVL control, qualification, supplier audits,
supplier quality management system, supplier performance monitoring, quality issue management and SCSR risk management. Supplier
shall take reasonable steps to prevent the use of high risk suppliers in the production of Products for KORNIT. A high risk supplier
is one that requires material waivers or that has financial performance below a level that is recommended by KORNIT.

 

4.6.2   Subcontractor
and Material Supplier Monitoring

 

The
Supplier will provide evaluation, qualification and on-going assessments of Subcontractor and Material Supplier capabilities,
in accordance with procedures and processes customary at Supplier, in order to minimize risk to KORNIT. The type and frequency
of quality control indicators received (quality performance, root cause/corrective actions, problem tracking, etc.) will be documented.
Subcontractor and Material Supplier management will be included as a critical process to review in Supplier self-audits. Subcontractor
and Material Supplier management process documentation will include, as a minimum:

 

	 	●	Quality plan/requirements
	 	●	Audit criteria (template)
	 	●	Audit schedule and reports

 

It
is hereby clarified that such evaluation, qualification and on-going assessments by Supplier shall not derogate from the respective
Subcontractor and Materials Supplier's warranty for the Materials or services performed by it and Supplier shall not be liable,
in any event, for any faulty performance or non-performance by any Subcontractor or Materials Supplier.

 

4.7  Supplier
Quality Control

 

Supplier
shall establish and maintain a quality control process. Specific requirements of that process and agreed quality levels and goals
shall be established and will be mutually agreed periodically (usually annually). If KORNIT and Supplier fail to reach agreement
prior to the commencement of a new period, the quality levels and goals previously in effect will continue to apply until such
time as mutual agreement on new levels and goals is reached.

 

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4.8  Product
identification and Lot Traceability

 

The
Supplier shall establish and maintain procedures and processes for the identification and lot traceability of agreed upon critical
items during all stages of production, as well as for delivery to KORNIT or its Customers. Identification must be traceable through
to the finished Product by serial numbers or equivalent methods. Both forward and backward traceability shall be available. If
required, KORNIT will provide information to Supplier on what identification items are required on the Product label. The lot
traceability shall be provided in accordance with the information available at Supplier's systems. Any request for special lot
traceability shall be at KORNIT's expense.

 

4.9  Defective
Products

 

The
Supplier shall establish procedures for the control, identification, segregation, review, evaluation, and disposition of Defective
Products. This includes both Products returned from the field, as well as within the Supplier’s process. Supplier shall
allocate separate holding areas for Defective Products, to prevent use in the manufacture of the Product or return to KORNIT.
This procedure will include the following items:

 

1.       Reporting
method to management and/or subcontractors

2.       Failure
Analysis (FA) team, procedures, turn-around time, and facilities

3.       Corrective
Action implementation

4.       Customer
feedback loop/customer involvement

 

4.9.1  Root
Cause Analysis and Corrective Action

 

Supplier’s
responsibilities for Defective Products will be defined in the Agreement. Supplier shall assure containment of Defective Products
to avoid escape to KORNIT or its Customers. Supplier shall allocate separate holding areas for Defective Products, to prevent
use in the manufacture of Product. Supplier shall notify KORNIT in writing, or present to KORNIT within a prompt but reasonable
time frame not to exceed [* * *], the root cause analysis and corrective action in the process and quality systems to
prevent recurrence.

 

At
a minimum, the following items shall be addressed:

 

1.       Defining
the root cause of the defect or non-conformance

2.       Providing
an explanation of how the defective part(s) escaped the supplier's process

3.       Providing
target dates for the implementation of corrective actions

4.       Providing
a detailed analysis of the controls implemented to prevent reoccurrence of the defect

5.       Supplier
must show corrective action will be implemented across all similar processes making similar parts

 

In
case any defect has been found in the Product, KORNIT may require the Supplier to perform 100% inspection of the Product at the
Supplier's location (prior to shipment) or at KORNIT’s location, and at the Supplier's expense, until a root cause analysis
and corrective action report is mutually agreed upon. KORNIT shall not unreasonably delay or withhold approval of such report.
KORNIT shall bear all of the risk, and all costs and expenses, associated with Products that have been inspected by Supplier for
which no defect that is covered under Supplier's warranty (as set forth in the Agreement) has been found.

 

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5  Process
/ Product / Engineering Change Controls

 

5.1  Control
of Parts

 

Supplier
shall maintain documentation to identify all “work in process” (WIP) including the referenced Specification for each
WIP item. Supplier shall have controls in place to control the possibility of down-level and/or returned parts being mixed with
good stock. Unless otherwise agreed to by the parties, the FIFO (First-In, First-Out) inventory control methodology shall be used.

 

5.2  Document
Control

 

All
documents required for the production or testing of the Product such as software/firmware, engineering drawings, specifications,
contracts, policies, procedures, manufacturing process flow chart, and work instructions (including test procedures) shall be
under revision control and shall be made available to all necessary personnel in the manufacturing environment. Supplier shall
have a system for the effective updating/removal of any obsolete documentation from all manufacturing areas and its storage in
accordance with a reasonable records retention program.

 

5.3  Supplier
Change Notification to KORNIT

 

Unless
specifically agreed to the contrary, Supplier shall notify and obtain written approval from KORNIT using the ECR (Request for
Engineering Change) process, or other mutually agreed to method, prior to any changes to the Product. These changes include:

 

	 	●	Site
location change
		●	Tooling
                                         change/addition/removal (encompasses tooling design or method change), including changes
                                         to fixtures, gages and test equipment.
		●	Process
                                         flow change (such as alternating a sequence of operations, adding or deleting an operation
                                         or inspection), including any chemical, mechanical or process changes which could affect
                                         the performance, reliability, safety, serviceability, appearance, dimension, tolerances.
	 	●	Design change driven (portions controlled by the supplier)
	 	●	Packaging change
	 	●	Test/inspection change
	 	●	Code / Firmware Change
	 	●	Component AVL/BOM/COL change, material source change
	 	●	Process (assembly or repair) chemical change

 

Other
requirements for written approval of changes may be set forth in the mutually agreed Specifications or Product supplements to
this document. KORNIT reserves the right to reject any change that requires KORNIT’s approval.

 

For
all changes that do not require advance KORNIT approval of the change, Supplier shall use reasonable efforts to promptly notify
KORNIT of such change(s).

 

5.3.1   Re-qualification:

 

Following
KORNIT’s initial qualification of the Product, any changes to the Product that require KORNIT’s approval may require
re-qualification of the Product. Re-qualification may be also performed by Supplier.

 

5.4  Supplier
Engineering Change (ECO) Process Control Requirements

 

Supplier’s
Engineering Change process must be documented. ECO definition shall include (but not be limited to) any chemical, mechanical or
process changes to the product, proposed by KORNIT or Supplier, which would affect the performance, reliability, safety, serviceability,
appearance, dimension, tolerances, or composition of BOM or material sources. Supplier is required to build product to the specifications
and Bill of Materials (BOMs) released in the ECO document. Any deviation from that BOM requires a documented approval from KORNIT.

 

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5.5  Supplier
Process Control Requirements

 

The
Supplier shall have process controls in place to prevent unintentional or accidental process changes from being made.

 

5.6  Engineering
and Process Documentation Requirements

 

The
engineering and process documentation must have a PDM (Product Data Management) type system of engineering change control. The
PDM system shall include a BOM for all products / parts, and the Supplier will maintain access for KORNIT to the latest revision
of the BOM, regardless of who controls the master document and its content. All parts referenced in the BOM that are managed by
Supplier will be identified and will have an engineering drawing, specification or equivalent. All parts referenced in the BOM
that are managed by other companies, such as KORNIT specified parts or commercially available items, will also have an engineering
drawing, specification or equivalent available through the PDM system.

 

5.6.1  Tooling
Documentation Requirements

 

All
process and tooling documentation (including fixtures and gauges) shall be maintained and referenced to the revision level of
their associated parts and assemblies in the BOM.

 

6  Acceptance
of Final Product by KORNIT

 

6.1.1  Part
to Print

 

All
Supplier shipments to KORNIT or its customers shall be on a part-to-print, defect-free basis (in accordance with Supplier's warranty
set forth in the Agreement) irrespective of any sampling plans by the Supplier to verify product quality prior to shipment. With
the exception of any parts purchased from KORNIT, Supplier shall be responsible for managing quality of the Products in accordance
with the provisions of this Document.

 

6.1.2  Defective
Products

 

Supplier’s
responsibilities for Defective Products, and KORNIT’s remedies for Defective Products shall be only as specified in the
Agreement.

 

6.2  On-Site
Support

 

Where
defect levels exceed the agreed quality rates, and upon KORNIT’s request, the Supplier shall provide on-site support to
perform sorting, failure analysis, and corrective action reporting. This on-site support shall be continuous until the defect
level of the Products is determined to be within the committed quality rates for a sustained period as determined by KORNIT. KORNIT
shall bear all of the risk, and all costs and expenses, associated with Products for which no defect that is covered under Supplier's
warranty (as set forth in the Agreement) has been found.

 

Where
mutually agreed to by KORNIT and Supplier, continuous On-Site Support will be provided by the Supplier at the KORNIT’s or
its customers' location(s) to perform sorting, failure analysis, and corrective action reporting. Specific requirements will be
mutually agreed to in writing.

 

6.3   Exception
Shipment Approval Process

 

The
Supplier shall not ship any Product that is known to be non-conforming without written approval. In certain cases, KORNIT may
approve shipment of suspected non-conforming product if an adequate evaluation plan is approved by KORNIT.

 

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7   Stop
Ship / Stop Build Procedures

 

7.1  Quality
Problem Notification to KORNIT

 

The
Supplier shall notify KORNIT of any quality, reliability or safety problems found by Supplier which may affect the Products. KORNIT
reserves the right to stop ships or stop build at the Supplier’s manufacturing site(s) due to any issues that affect KORNIT
production yields or customer quality.

 

7.2  Problem
Communication

 

A
formal process must be established to notify KORNIT of problems.

 

7.3  Problem
Resolution

 

Stop
ships and stop builds shall be treated with maximum urgency, and will not be lifted until root cause is understood and corrective
actions are in place. As such, Supplier shall provide immediate technical support in order to find the root cause and provide
containment actions. The working notes involved in resolution of problems shall be recorded in the SPL (or other mutually agreed
to methodology), along with root cause explanations, corrective actions and material disposition. KORNIT shall bear all of the
risk, and all costs and expenses, associated with Products for which no defect that is covered under Supplier's warranty (as set
forth in the Agreement) has been found.

 

7.4   Product
Disposition

 

Supplier
shall ensure that no quality compromise will be made when suspected Defective Product is being dispositioned. There shall be no
shipment of suspect Products to KORNIT or its customers without KORNIT’s approval.

 

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8   Quality
Goals, Continuous Improvement and Reporting

 

8.1   Quality
Goals / Commitments

 

The
ultimate goal is defect free product from a controlled process. The quality and reliability performance requirements will be documented
in a Product Quality Addendum or other methods as determined by KORNIT. Included, as examples, will be expected Shipped Product
Quality Level (SPQL) and reliability requirements.

 

8.2    Continuous
Improvement

 

The
Supplier shall have a continuous improvement plan to both achieve agreed to quality goals/commitments. KORNIT strives for
 [* * *] quality improvement in our products year over year. In order to support our product goals, KORNIT suggested best practice for
suppliers is a minimum [* * *]% improvement in quality performance year over year unless otherwise stated in the SQD/PQA. For each
improvement activity, the following information must be documented: Description of the activity

 

		●	The
objective of the activity

 

		●	Progress
checkpoint dates and the target date for completion of the activity

 

		●	Projected
quality levels at checkpoints and upon completion of activity

 

Detailed information
(i.e. root cause analysis, implementation phase-in dates, effectiveness assessment methodology, etc.) supporting individual actions
for continuous improvement shall be included.

 

8.2.1
 Quality Techniques

 

The
Supplier shall use continuous improvement techniques to establish, maintain and improve quality. These techniques will be used
in all stages of product life (i.e., design, qualification, ongoing production, and end of life production). The list of techniques
will vary depending upon the stage of product life and quality performance.

 

Some examples
of techniques include but are not limited to the following. KORNIT and Supplier will mutually agree upon the techniques needed
for a specific application, as required.

 

1.       Fault
Tree Analysis

2.       Failure
Modes and Effects Analysis (FMEA)

3.       Capability
Analysis

 

8.3   Quality
Reporting

 

8.3.1  Periodic
Summary Reporting

 

KORNIT may require
regular quality reporting, usually monthly. The Product Quality Addendum shall include specific reporting requirements and intervals.

 

8.3.2  Quality
Metric Listing

 

The Supplier will maintain
a summary table of all key measurements, definitions, frequency of reporting, goals, and continuous improvement targets.

 

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9  Audits

 

9.1  Audits
and Inspection by KORNIT

 

KORNIT shall have the
right, subject to any agreed confidentiality obligations, to audit a Supplier’s design, support, or manufacturing site that
produces Product for KORNIT. KORNIT can also inspect the Product at any stage during development or production. KORNIT will provide
reasonable notification to the Supplier of its intent to audit or to inspect product. Supplier documents relevant to the Product
quality will be provided to KORNIT for review upon KORNIT’s request.

 

KORNIT’s inspection
of Product does not relieve the Supplier’s warranty for the Products, as set forth in the Agreement KORNIT reserves the
right to reject any Product that is found to be Defective Products subsequent to inspection at source by KORNIT.

 

9.2  Subcontractor
Audit

 

This right to audit
and inspect extends to Subcontractors or Material Suppliers, solely to the extent such audit and inspect has been approved in
advance and in writing by the respective Subcontractor or Material Supplier, and shall be subject to any limitations in the agreements
between the Supplier and its Subcontractors or Material Supplier.

 

9.3  Supplier
Self Audits

 

The
Supplier shall document and maintain a program of internal auditing to ensure continuing control and compliance to the procedures
utilized to meet the requirements of this Document. Reasonable information regarding the results and corrective actions of self-audits
shall be made available to KORNIT upon request.

 

10   Quality
Records

 

Supplier
shall establish and maintain procedures for identification, collection, indexing, filing, storage, maintenance, and disposition
of all quality records. As examples, these records may include raw data or control charts, for critical/identified process parameters,
and records of all inspection and test activity to provide objective evidence that products have passed acceptance criteria. Records
shall be maintained for time periods as agreed to between the Supplier and KORNIT.

 

A listing of all quality
records, with the retention period defined, must be maintained. Product Quality Addendums may contain additional requirements
regarding the management of quality records.

 

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11   Standard
Compliance Requirements

 

11.1  ISO
9000

 

Supplier shall be,
and shall remain ISO 9001 compliant. Compliance can be either external accreditation or self-declaration.

 

For external accreditation,
a copy of the Supplier’s current registration is required. For self-declaration and upon KORNIT's written request, Supplier
shall provide KORNIT with a letter of assurance from Supplier’s CEO/COO or other officer of Supplier that self-declaration
was done with due diligence based upon a previously executed internal audit report, and has had executive management review and
approval.

 

11.2  KORNIT
Standards Requirements

 

When
referenced as a requirement in the Agreement, or Specification; specific agreed upon KORNIT standards requirements shall be met.
These may include, but not be limited to Safety Standards, Country of Origin (COO), Shipping, Packaging, Labeling and Environmental
Standard requirements.

 

11.2.1  Environmental
Requirements

 

Supplier
represents that: (i) its manufacturing processes and methods meets EU Directive 2011/65/EU about the Restriction of Use of Hazardous
Substances ("RoHS Directive");
(ii) all Materials are manufactured by manufacturers which have been identified by KORNIT in the BOM / AVL as RoHS Directive approved
manufacturers for such Materials, provided that Supplier received the corresponding RoHS Directive certificate from such manufacturers
and based upon such RoHS Directive certificate. Except as stated herein, Supplier gives no representations or warranties with
respect to environmental requirements. 

 

11.2.2   Shipping
to KORNIT and Authorized Third Parties

 

The
Supplier shall ship and package all Products per the mutually agreed Specifications and the provisions of the Agreement.

 

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12  Equipment
Control

 

12.1  Calibration
Requirements

 

The process for calibrating
manufacturing and inspection equipment such as CNC (Computerized Numerical Control) machines, spot welders, ovens, wave solder,
verniers, torque tools hardness testers, dielectric strength, DVM's (Digital Voltmeter), ICT (In-Circuit Test), FCT (Functional
Card/Component Test) and vibration test equipment, etc. shall be defined and documented by the Supplier. As part of the calibration
requirements, Supplier shall maintain records of the equipment calibrated, equipment labeling, calibration processes used, and
the frequency of calibration.

 

12.2  Supplier's
Equipment Maintenance

 

Supplier shall document
the process used for Supplier's equipment maintenance, including preventive maintenance records, scheduling, identification, and
storage and shall perform maintenance in accordance with such plans. KORNIT shall be responsible to maintain its equipment and
tooling in accordance with the provisions of the Agreement.

 

12.3  New
Equipment Capability

 

A process for integrating
new equipment (other than standard production equipment that is not Product-specific) and technology into the Supplier's operations
shall be documented. Where appropriate, and when Supplier is requesting permission from KORNIT to use new equipment or technology
in the production of the Product, such request shall include:

 

		●	The
number and duration of consecutive successful trials required prior to declaring the equipment qualified

		 	 

		●	The
potential effect of the new equipment or technology on other required manufacturing operations, including those sub-contracted

		 	 

		●	How
manufacturing operations (including subcontracted manufacturing operations) will be evaluated

		 	 

		●	The
expected timetable for updating all required quality plans, machine maintenance files, operator training plans, calibration schedules,
etc.

 

Additional requirements
for use of new equipment or technology in the production of the Product may be included in the Product Quality Addendum.

 

12.4  ESD

 

The Supplier shall
have ESD controls, materials and procedures in place that are reasonable for the Product(s) being produced against damage due
to electrostatic discharge. All personnel that have direct contact with the Product or any portion thereof must be trained in
ESD handling techniques and where appropriate, must wear wrist straps and clothing made specifically for avoiding a build-up of
electrostatic charge. ANSI/ESD S20.20-2007, while not required to be used, describes the elements of an effective ESD program.

 

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13  Training
and Workmanship

 

Supplier
shall provide initial and periodic training to manufacturing, test, and quality assurance personnel of Supplier to ensure a skilled
and effective workforce.

 

13.1  General
Requirements

 

General
training, such as computer fundamentals, component identification, component/commodity handling techniques, and electrostatic
discharge (ESD) control shall be provided to all manufacturing and test personnel of Supplier. Training that is specific to the
Product, or is required of the personnel building that Product, and any related training documents, shall be documented and shall
be provided to all personnel manufacturing the Product for KORNIT. Safety training specific to job requirement shall be provided.
Periodic refresher training shall be provided.

 

13.2  Training
Certification

 

The
Supplier shall maintain certification and de-certification procedures for all production workers. Only those production workers
that are certified to the proper level are to be allowed to participate in the manufacturing and test procedures. All production
workers are to be re-certified periodically in accordance with the Supplier’s documented training program. The Supplier
shall maintain a training requirement matrix that outlines the type of training required for certification at each key position
within the design and manufacturing process and the status of all workers in achieving such certification including the date of
the last certification.

 

13.3  Workmanship

 

Supplier
shall work according to its workmanship standards The Specification or the Product Quality Addendum may require additional or
more stringent standards, as shall be agreed upon between the parties.

 

14  IT
Toolsets

 

Where
required as part of the Specification or Product Quality Addendum, the following toolsets are used to communicate product, process,
and quality data to KORNIT.

 

		1.	SQMS2
                                         The SQMS2 (Supplier
                                         Quality Management System) enables collection of product quality information from Suppliers
                                         and the KORNIT or Authorized Third Party manufacturing lines, providing two-way communication
                                         on quality performance. Suppliers can access the data to track how their components or
                                         parts are performing in KORNIT’s products and get feedback to help them improve
                                         quality.

 

		2.	PCN
                                         (Process Change Notification)
                                         is an end-to-end system that records incoming change requests from a supplier, alerts
                                         consuming brands, and returns requirements data to the supplier. This greatly reduces
                                         miscommunication, contributes to higher quality by providing control over part changes,
                                         and improves engineering change turnaround.

 

		3.	QIN
                                         (Quality Information
                                         Network) is a database of information used to monitor supplier performance. When either
                                         a new or existing supplier is being evaluated, the tool can provide the auditor information
                                         on previous or scheduled audits before a visit to the supplier site is planned. If the
                                         audit trip is deemed justified, it can be scheduled and the findings documented in QIN.
                                         Other engineers in any division worldwide can then access the information, saving both
                                         supplier and KORNIT time and money that might otherwise be expended in multiple visits
                                         and evaluations of a single supplier.

 

		4.	SPL
                                         (Supplier Problem
                                         Log) tracks quality issues by supplier. This management tool provides a comprehensive
                                         and structured approach to problem tracking from reporting through resolution. The tool
                                         also is a central information repository for commodity quality issues throughout the
                                         enterprise.

 

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15  KORNIT’s
Qualification of Products

 

KORNIT’s qualification
of Products for use in KORNIT’s Products shall in no way relieve the Supplier of warranty responsibility for any Products
that is Defective, as set forth in the Agreement. Any KORNIT test of the Product will not test all fail modes.

 

16  Related
Documents

 

16.1  Product
Quality Addendum (PQA)

 

The
“Product Quality Addendum” is an optional document, provided by KORNIT to the Supplier and agreed in writing by the
Supplier that sets forth specific quality requirements for a Product including technical, and / or quality goals for the Product
and any exceptions to this SQRD Document.

 

16.2  Supplier
Quality Document (SQD)

 

The “Supplier
Quality Document” is an optional document, provided by the Supplier to the KORNIT and agreed in writing by the Supplier
that documents any or all of the following, as applicable:

 

		●	Supplier’s
commitments and methods to meet all quality requirements of the SQRD Documents and the PQA.

 

		●	KORNIT
Approved Waivers / Specification exceptions.

 

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17  Acronyms

 

ANSI
American National Standards Institute (added) 

AVL
Approved Vendor List 

BOM
Bill of Material 

CDA
Confidential Disclosure Agreement 

CNC
Computerized Numerical Control 

CPL
Components Placement List 

COL
Change of Location 

CSA
Canadian Standards Association 

DVM
Digital Voltmeter 

ECAT
Electronic Card Assembly and Test 

ECO
Engineering Change Order 

ESD
Electro Static Discharge 

E2E
End to End 

FA
Failure Analysis 

FCT
Functional Card/Component Test 

FIFO
First-In, First-Out Inventory Control 

ICT
In-Circuit Test 

ISO
International Organization for Standardization 

MAC
Media Access Control (Address) 

MPQA
Master Product Quality Agreement 

PCN
Process Change Notice 

PDM
Product Data Management (System) 

PQA
Product Quality Addendum 

QIN
Quality Information Network 

REA
Request for Engineering Action 

SCSR
Supply Chain Social Responsibility 

SPL
Supplier Problem Log 

SPQL
Shipped Product Quality Level (aka IQL) 

SQD
Supplier Quality Document 

SQMS2
Supplier Quality Management System 2 

TQA
Technology Qualification Application

 

    	 	C-20	 

     

    

 

EXHIBIT
D – PRODUCT SPECIFICATIONS

 

[
* * * ]

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    	 	D-1	 

     

    

 

EXHIBIT E – AUTHORIZED SUBCONTRACTORS 

 

 

	AUTHORIZED  SUBCONTRACTORS

 

 

[
* * * ]

 

 

 [
two pages follow ]

 

 

 

    	 	E-1	 

     

    

 

EXHIBIT
F – CERTIFICATE OF INSURANCE

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    	 	F-1	 

     

    

 

Insurance
By Kornit Digital Ltd.

 

Insurance
Certificate

 

Date:
_______________

 

To

Flextronics
(Israel) Ltd., having its place of business at 2 Hamatechet St., Ramat Gavriel Industrial Park Migdal Ha-Emek 23108 Israel P.O.B.
867 Israel ("Flextronics")

 

		1.	Insurance
                                         Certificate In Connection With the Manufacturing Service Agreement (hereinafter, "The
                                         Agreement") Executed Between Kornit Digital Ltd. (hereinafter, "Kornit")
                                         And Flextronics (Israel) Ltd. (hereinafter, "Flextronics")

 

We
hereby confirm that as of ____________ and until ____________ (both days inclusive), we have issued in favor of Kornit, the following
insurance policies with respect to Kornit's activity in connection with the contract.

 

Employer’s
Liability Insurance: 

Covering
Kornits' legal liability pursuant to the Torts Ordinance (New Version) and the Liability for Defective Products Law towards any
employee with a limit of liability of US$[* * *] for any one occurrence and in the aggregate for the period of insurance.

 

This
policy does not exclude liability towards contractors, sub-contractors or their employees in case kornit will be considered as
their employer to the extent no other employer’s liability insurance policy has been issued by Kornit and/or on behalf of
Kornit .

 

The
insured's name in the above policy is extended to include Flextronics in the event that it is determined that kornit is liable
as an employer of any such person.

 

General
Third Party and Product Liability Insurance:

 

General
Third Party Liability Insurance Policy: 

Covering
Kornits' legal liability towards any third party in respect of any property damage and/or bodily injury caused during the period
of the insurance for a limit of liability of US[* * *] any one occurrence and in the aggregate for the period of insurance.
The insurance is extended to indemnify Flextronics for its legal liability due to a property loss or bodily injury committed by
Kornit, subject to a cross-liability clause.

 

Product
Liability Insurance Policy: 

Product
liability insurance including completed operations coverage with a limit of liability of no less than US$[* * *] per event and
in aggregate for the annual insurance term, covering Kornits' legal liability in respect of products; which shall be supplied
or installed or otherwise treated or repaired by Kornit or on its behalf (the “Product”) pursuant to the Agreement
but not before 1.1.2003.

 

The
policy is extended to indemnify Flextronics and all those acting on its behalf, for their liability for personal injury or damage
to property which is caused due to the Product, subject to a cross-liability clause, pursuant to which the policy is considered
to have been procured separately for each of the insured entities, as if it was issued solely in such name. The policy shall apply
retroactively as of the date at which Kornit supplied the Product, even if supplied prior to the execution of the Agreement but
not before 1.1.2003.

 

    

     

    

 

The
policy includes an extended reporting period clause of at least 6 months, pursuant to which, in the event that the insurer does
not renew the said policy, the policy shall cover damage which originated during the insurance period, with respect to which notification
was sent to us during the notification period.

 

The
policy subject to: territorial limits and jurisdiction worldwide

 

Property
& BI Insurance Policy: 

The
Policy provides "Extended Fire" insurance covering the materials, products, equipment, inventory, stocks or any other
property of all shapes and kind owned or under the responsibility of the Customer up to their full value (burglary is limited
for any one occurrence and for the period to the amount of .............(*) This amount is on a first loss
basis which is not subject to underinsurance) while being at the custody or control of Flextronics or any one on behalf of Flextronics
including but not limited whilst in storage (including at Flextronics premises), against including but not limited any loss or
damage caused by "Extended Fire" perils.

 

(*)
The sum insured in respect of Burglary shall be completed in the signed certificate of insurance and shall reflect the actual
sum as per Kornit's insurance policy 

 

The
policy includes consequential loss insurance in respect of an indemnity period of ...........(*) months due to
a loss or damage covered under the insurance detailed above. The policy shall be extended to include cover in respect of any consequential
loss occurring due to an event occurring to Kornit's property and/or to property relating to any one on behalf of Kornit or in
Kornit's possession, liability, ownership or other interest. 

 

(*)
Indemnity period to be stated in the certificate of insurance as per Kornit's policies. 

 

This
Policy will include a provision whereby insurer waives right of subrogation against Flextronics and/or any one on behalf of Flextronics
and/or towards any one which Flextronics committed to waive it's right of subrogation and/or Flextronics customers for any loss
or damage. The waiver of subrogation shall not apply towards a party that caused the damage intentionally or by willful misconduct. 

 

General 

The
following provisions apply to the above policies:

 

		●	We
                                         waive our right to subrogation against Flextronics and/or it's parent company and/or
                                         subsidiary company and/or managers and/or employees. The waiver of subrogation shall
                                         not apply towards those that caused the damage intentionally.

 

		●	The
                                         policies described above shall not be reduced or cancelled, without 30 days prior written
                                         notification thereof, sent to Flextronics via registered mail.

 

		●	We
                                         are aware that Kornit's alone is liable for payment of the insurance premiums and deductibles.

 

		●	Breach
                                         of any of the policies' terms and conditions by Kornit in good faith shall not derogate
                                         from the insurer’s undertaking to indemnify Flextronics.

 

		●	Kornit's
                                         insurance policies shall be Bit wording ........ (Complete the edition) or equivalent.

 

		2.	This
                                         confirmation is subject to the terms, conditions and provisions of the original policies
                                         insofar as not expressly altered by the foregoing.

  

		3.	The
                                         limits of liability that stated in this certificate are combined for all the insureds'
                                         activities.

  

Yours
faithfully,

 

______________________________

 

Insurance
Co. Ltd

 

______________________________

 

Signatory's
name and position

 

    

     

    

 

Insurance
By Flextronics (Israel) Ltd.

Insurance
Certificate

 

Date:
_______________

 

To

Kornit
Digital Ltd. having its place of business at 12 Ha`Amal St., Afek Park, Rosh-Ha`Ayin 4809246, Israel (hereinafter, "Kornit")

 

		4.	Insurance
                                         Certificate In Connection With the Manufacturing Service Agreement (hereinafter, "The
                                         Agreement") Executed Between Kornit (hereinafter, "Kornit")
                                         And Flextronics (Israel) Ltd. (hereinafter, "Flextronics") 

 

We
hereby confirm that as of ____________ and until ____________ (both days inclusive), we have issued in favor of Flextronics,
the following insurance policies with respect to Flextronics 's activity in connection with the contract.

 

Employer’s
Liability Insurance:

Covering
Flextronics' legal liability pursuant to the Torts Ordinance (New Version) and the Liability for Defective Products Law
towards any employee with a limit of liability of NIS[* * *] for any one occurrence and in the aggregate for the period of
insurance.

 

This
policy does not exclude liability towards contractors, sub-contractors or their employees as long as they are considered Flextronics's
employees.

 

The
insured's name in the above policy is extended to include Kornit in the event that it is determined that Flextronics is liable
as an employer of any such person.

 

Wording
shall not be interferer to Bit ......, (complete the relevant edition) wording or equivalent.

 

General
Third Party and Product Liability Insurance:

Covering
Flextronics' legal liability towards any third party in respect of any property damage and/or bodily injury caused during the
period of the insurance for a limit of liability of $[* * *] any one occurrence and in the aggregate for the period of insurance.
The insurance is extended to indemnify Kornit for it's legal liability due to a property loss or bodily injury committed by Flextronics,
subject to a cross-liability clause. Policy includes coverage for Product Liability covering Flextronics' legal liability in respect
of products; which shall be supplied or installed or otherwise treated or repaired by Flextronics' or on its behalf (the “Product”)
pursuant to the Agreement. The policy is extended to indemnify kornit and all those acting on its behalf, for their liability
for personal injury or damage to property which is caused due to the Product, subject to a cross-liability clause, pursuant to
which the policy is considered to have been procured separately for each of the insured entities, as if it was issued solely in
such name.

 

The
Products Liability subject to territorial limits and jurisdiction worldwide.

 

Wording
....................................................
(please complete the relevant edition)

 

General

The
following provisions apply to the above policies:

 

		●	We
                                         waive our right to subrogation against Kornit and/or subsidiary company and/or managers
                                         and/or employees.

 

		●	The
                                         policies described above shall not be reduced or cancelled, without 30 days prior written
                                         notification thereof, sent to Kornit via registered mail.

 

		●	We
                                         are aware that Flextronics alone is liable for payment of the insurance premiums and
                                         deductibles.

 

		●	Innocent
                                         Breach of any of the policies' terms and conditions by Flextronics shall not derogate
                                         from the insurer’s undertaking to indemnify Kornit.

 

		5.	This
                                         confirmation is subject to the terms, conditions and provisions of the original policies
                                         insofar as not expressly altered by the foregoing.

 

		6.	The
                                         limits of liability that stated in this certificate are combined for all the insureds'
                                         activities.

 

Yours
faithfully,

 

______________________________

 

Insurance
Co. Ltd

 

______________________________

 

Signatory's
name and position

 

    

     

    

 

CERTIFICATE
OF INSURANCE

 

This
certifies that  Insurance Company Ltd insures the property listed below in accordance with the terms and conditions
of the below referenced Policy and Endorsements attached thereto. This Certificate of Insurance does not amend, extend, or otherwise
alter the terms and conditions of insurance coverage provided by such Policy.

 

 

TITLE
OF INSURED: Flextronics (Israel) Ltd

 

 

Policy
No:                  <                    >                                  Policy
Effective:

                                                                                               Policy
Expires:

Account
No:                                                                         Certificate
Effective:

                                                                                               Certificate
Expires:

 

 

Description
& Location of Property Covered:

 

Real
and Personal Property Insurance including Consequential Loss

All sites
of Flextronics in Israel

______________________________________________________________________

Coverage
in Force: (Subject to limits of liability, deductibles and all conditions in the policy)

 

Peril:
All Risks of Physical Loss or Damage, unless excluded by the Policy

 

Limit
of Liability: USD [* * *]

 

 

Additional
Detail:  

 

Waiver
of Subrogation is granted towards Koranit Digital Technologies Ltd, with the exception of waiver towards who caused damage by
intent.

 

The
supplier (our Insured) shall be liable to bear the premium & deductible payments.

 

The
certificate holder will be notified 60 days prior, in respect of cancellation or reduction in coverage.

 

_____________________________________________________________________________

 

Certificate
Holder: KORANIT DIGITAL TECHNOLOGIES LTD.

 

Certificate
No.:

 

By:
___________________________                               Date:

Authorised
SignatureExhibit 4.12

 

[*
* *] Portions of this agreement were omitted and a complete copy of this agreement has been provided separately to the Securities
and Exchange Commission pursuant to the company’s application requesting confidential treatment under Rule 24b-2 of the
Securities Exchange Act of 1934, as amended.

 

[Unofficial
English Translation of original Hebrew document]

 

Memorandum
of Understanding- Kornit

 

		1.	BG
                                         will establish a new manufacturing line, which shall function, subject to Section 8,
                                         for production of dedicated products for Kornit.

 

		2.	BG
                                         estimates that the construction period for the manufacturing line referred to will be
                                         approximately [* * *]. A down payment as provided in Section 5 below shall be paid in
                                         three equal installments as follows: 1. The first installment shall be paid upon signing
                                         of this agreement. 2. The second installment shall be paid upon the arrival of [* * *]
                                         to BG's premises. 3. The third installment shall be paid upon the completion of the construction
                                         of the manufacturing line. It is agreed that if BG fails to complete the construction
                                         of the manufacturing line within [* * *] from the date of signing of this agreement,
                                         BG shall immediately return to Kornit the full down payment in cash.

 

		3.	The
                                         manufacturing line shall include, among other things,  [* * *].

 

		4.	The
                                         production capacity potential shall remain [* * *] of products per calendar year.

 

		5.	Kornit
                                         shall pay a down payment of USD [* * *], which shall be refunded as discount on the product
                                         price in the following manner:

 

USD
$[* * *] per each kg. of product, up to a maximum annual rebate of USD [* * *], which constitutes an order of [* * *] of product
per year.

 

		6.	Other
                                         than due to any material breach of this agreement by BG, as defined below, which was
                                         not cured within 30 days from the date a written notice had been given by Kornit regarding
                                         such breach, this agreement shall be in force for five years with no exit points.

 

"Material
Breach" for purposes of section 6 shall mean one of the following two: 1. BG's failure to fulfill its obligations of product
delivery. 2. BG’s failure to meet the product specifications which were agreed by the parties as detailed in Exhibit ___.

 

It
is hereby clarified for the avoidance of doubt, that the termination of the agreement by Kornit due to a material breach of BG
will be the sole remedy and Kornit will not be entitled to any compensation and /or any relief from BG. In addition, even in the
event of termination of the agreement by Kornit in accordance with paragraph 6 above, the unused balance of the advance will not
be returned to Kornit.

 

		7.	Kornit
                                         undertakes to purchase polymers from BG at a minimum quantity of [* * *] per year for
                                         5 years, or [* * *] in a period shorter than 5 years, whichever is sooner, at the price
                                         listed in Section 14 hereto, plus VAT as required by law, at the times and quantities
                                         listed in the purchase orders delivered by Kornit to BG at least [* * *] in advance.
                                         It is hereby clarified that in the event Kornit ceases to buy products and does not meet
                                         the purchase minimums other than as a result of BG's material breach, then the unused
                                         balance of the down payment, will not be refunded to Kornit in any case.

 

    

     

    

 

		8.	As
                                         long as Kornit meets the purchase minimums referred to above in Section 7 above, BG undertakes
                                         to maintain its production capacity for Kornit, and not to manufacture products using
                                         the [* * *] other than those products manufactured for Kornit.
	 	 	 
	 	9.

                                                                                 
	It is agreed, that
                                                                                                                                          during the term of the agreement and during an additional year from the expiration of the agreement, and subject to Kornit's
                                                                                                                                          compliance with the agreement, BG shall refrain from selling to a third party the following products: [* * *] and [*
* *] and/or any other future unique product which is produced by BG for Kornit. The above is binding only upon products whose
use is used as a raw material for ink for printing on textiles. Notwithstanding the foregoing, if Kornit does not wish to renew
the agreement after the five year term, BG may sell the products mentioned above to any third party including for use for ink
for printing on textile. If BG does not want to continue the agreement after 5 years, such obligation shall also apply for the
duration of [*
* *] from the agreement's termination.

 

		10.	After
                                         the establishment of the production line, in respect of any rejected runs that did not
                                         meet the parameters agreed by the parties as detailed in Exhibit A, Kornit shall be charged
                                         [* * *] of their full value at the time, up to a total of [* * *] runs per year. Runs
                                         which passed quality control at BG and yet were disqualified by Kornit will be charged
                                         [* * *] of their full value.

 

		11.	Until
                                         the establishment of the production line is complete, BG shall use its best efforts to
                                         create quality runs, fulfilling the above parameters. However, the company does not guarantee
                                         the amount of bad runs that may be produced. Furthermore, Kornit shall not be entitled
                                         to make any claims regarding the amount of bad runs. After the establishment of the production
                                         line, Kornit shall not be required to pay for bad runs beyond the quantity mentioned
                                         in section 10.
	 	 	 

		12.	Purchase
                                         Price denominated in US dollar shall be paid according to the USD-NIS exchange rate of
                                         the payment date, provided that such exchange rate shall not be lower than [* * *] per
                                         US$1 and polymers' prices shall be fixed at the price of "[* * *]". The consideration
                                         calculation to BG shall be calculated according to the highest rate of, and shall not
                                         be lower than the base exchange rates as determined on signing date. "USD Base exchange
                                         Rate" - the exchange rate as set by the Bank of Israel at the day of signing the
                                         agreement.

 

		13.	"Base
                                         price for [* * *]"- ____. Once a year the Polymers' price shall be fixed at the
                                         price of [* * *] according to the [* * *] price on the payments terms.

 

Annual
cash payment in advance before a framework order will receive a discount of [* * *]; or

 

Quarterly
cash payment in advance before a framework order will receive a discount of [* * *];

 

		14.	Product
                                         Prices:

 

[*
* *]- [* * *] per every kg of product

[*
* *]- [* * *]per every kg of product

 

Notwithstanding
the above, during the year 2017, the Product Price shall be USD [* * *] per every kg of product.

 

    	 	- 2 -	 

     

    

 

		15.	Any
                                         delay and/or failure to deliver as a result of facility malfunction which are not under
                                         BG's control, or is due to Force Majeure, were BG used its best effort to cure, shall
                                         not be considered a breach of an obligation by BG and shall not confer upon Kornit any
                                         right to compensation.

 

		16.	All
                                         of the invention rights and ownership rights in the intellectual property of the products
                                         purchased by Kornit under this agreement, including but not limited to, any formulas
                                         of materials of comprising the products and/or production methods of the products and/or
                                         BG’s work methods, in the development process and specifications of materials (referred
                                         to herein as "Intellectual Property Rights"), shall remain the sole and exclusive
                                         property of BG.

 

		17.	BG
                                         shall not transfer any of the unique manufacturing processes or formulas to Kornit.

 

		18.	If
                                         Kornit requests that BG transfer to it the unique formulas or manufacturing processes,
                                         and if BG determines to transfer such formulas and processes, then the transfer shall
                                         be made subject to the signing of a Knowledge Transfer Agreement and according to commercial
                                         terms which would be acceptable to BG.

 

		19.	Notwithstanding
                                         Section 18 above, on the date of the down payment, the manufacturing formulas will be
                                         placed in trust with Ashtrom Industries Ltd. ("Ashtrom"), so that in the event
                                         that BG will become bankrupt and/or cease to exist for whatever reason, representatives
                                         of Kornit and Ashtrom Industries Ltd. shall meet in order to mutually locate a third
                                         party who will manufacture the products instead of BG on the basis of the mentioned formula,
                                         and that its contract and terms will be agreed upon and approved in advance by Ashtrom
                                         Industries Ltd. For the avoidance of doubt, Kornit shall continue to pay for products
                                         which will be recieved and shall not own the formula.

 

		20.	All
                                         data related to Kornit/BG and their products, including manufacturing processes and formulas
                                         of Kornit/BG relative to their products, the volume of purchases, prices, products purchased,
                                         etc., are confidential and Kornit/BG or its representative are prohibited from disclosing
                                         them or making any use of them, particularly in connection with competitors of the Kornit.
                                         Provisions of this section shall not apply to information that is in the public knowledge
                                         and/or information known to Kornit/BG from other sources before it was provided by Kronit/BG
                                         to the respective party and/or which came to Kornit/BG's attention by a third party other
                                         than through a breach of confidentiality towards Kornit/BG. In the event Kornit/BG are
                                         required by law to disclose this agreement or any of its content to any regulatory institution
                                         including the United States Securities and Exchange Commission (SEC) or Nasdaq, then
                                         each of them shall be allowed to operate in accordance with the requirements of the aforementioned
                                         authorities as instructed by their respective legal counsels.

 

	/s/
    Ofer Sandelson	 	/s/
    Sharon Leventer
	Ofer
    Sandelson	 	Sharon
    Leventer CEO
	COO	 	B.G.
    (Israel) Technologies Ltd.
	 	 	 
	22.12.2016	 	 
	 	 	 
	/s/
    Guy Avidan	 	 
	Guy
    Avidan	 	 
	CFO	 	 

 

    	 	- 3 -	 

     

    

 

The
parameters for Kornit's Polymers:

 

[*
* *]

[*
* *] [* * *] [* * *]

[*
* *][* * *][* * *][* * *]

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

- 4 -

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