Document:

20-F

Exhibit 4.15  

CONFIDENTIAL 

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SUPPLY AGREEMENT 

REFERENCE *** 

between 

***

and 

SUMMIT AVIATION SUPPLY 

for 

***’S AIRCRAFT
PROGRAMS 

RELATING TO 

“***”

FOR THE ALL ***
PROGRAMS 

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SUPPLY AGREEMENT
REFERENCE *** 

This Supply Agreement, effective as
of ***, ***, ***, is made and entered into by and between ***, a corporation
existing under the laws of the ***, having its principal place of business at ***
(“***”), and Summit Aviation Supply, a company existing
under the laws of New Jersey, United States of America having its principal place of
business at 1008 Teaneck Road, Teaneck, N.J. U.S, is in regard to the supply of certain
aeronautical products for ***’s aircraft programs. 

RECITALS 

WHEREAS, *** is an aircraft
manufacturer, and is in the business of designing, manufacturing and selling aircraft
and aircraft parts;  

WHEREAS, *** issued a request
for proposal inviting bidders to submit proposals for the supply of certain electrical
hardware to support *** aircraft programs (“Programs”); 

WHEREAS, Supplier sent *** a
proposal indicating Supplier’s desire to participate in such Programs; 

WHEREAS, Supplier shall
provide certain electrical hardware, as more specifically described herein, to *** and to
third parties expressly indicated by *** (***); 

NOW, THEREFORE, in
consideration of the mutual covenants and agreements herein set forth, and for good and
valuable consideration which is acknowledged by each Party hereto, the Parties hereto
agree as follows: 

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TABLE OF CONTENTS 

	
PART
1 – DEFINITIONS AND EXHIBITS 

	1.1  	Definitions 

	1.2  	Exhibits 

	
PART
2 – OBJECT OF AGREEMENT 

	2.1  	Subject
of Agreement 

	2.2  	*** 

	2.3  	*** 

	
PART
3 – PRICES AND PAYMENT 

	3.1  	General
Terms 

	3.2  	Adjustment 

	3.3  	*** 

	3.4  	*** 

	3.5  	Payment 

	
PART
4 – PURCHASE ORDERS, DELIVERY AND ACCEPTANCE 

	4.1  	Purchase
Orders 

	4.2  	Delivery 

	4.3  	Acceptance
and Rejection 

	4.4  	Return 

	
PART
5 – TECHNICAL REQUIREMENTS 

	5.1  	Technical
Specifications

	5.2  	Interchangeability 

	5.3  	*** 

	5.4  	*** 

	
PART
6 – QUALITY ASSURANCE 

	6.1  	Quality
Requirements 

	6.2  	Source
Inspection 

	
PART
7 – FURTHER OPERATIONAL PROCEDURES 

	7.1  	*** 

	7.2  	Subcontracting 

	7.3  	Program
Surveillance 

	7.4  	Procurement
Offset Credits 

	7.5  	*** 

	7.6  	*** 

	
PART
8 – SUSPENSION, TERMINATION, *** AND *** 

	8.1  	Suspension 

	8.2  	***

	8.3  	*** 

	8.4  	*** 

	8.5  	Right
to Set Off 

	8.6  	*** 

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PART
9 – MISCELLANEOUS 

	9.1  	*** 

	9.2  	Supplier
Representations 

	9.3  	*** 

	9.4  	*** 

	9.5  	*** 

	9.6  	Insurance 

	9.7  	*** 

	9.8  	Publicity 

	9.9  	Customer
Contact 

	9.10  	Taxes
and Duties 

	9.11  	Survival

	9.12  	Amendment 

	9.13  	Assignment 

	9.14  	Compliance
With Laws 

	9.15  	Headings 

	9.16  	Severability 

	9.17  	Export
Control 

	9.18  	Nonwaiver 

	9.19  	Applicable
Law 

	9.20  	Dispute
Resolution 

	9.21  	Remedies
not Exclusive 

	9.22  	Independent
Contractors 

	9.23  	Changes
to Supplier Ownership or Affiliation 

	9.24  	Notices,
Requests and Language

	9.25  	Term
of Agreement 

	9.26  	Entire
Agreement 

Exhibits 

	Exhibit  A	
                 ***

	Exhibit  B	
                 ***

	Exhibit  C	
                ***

	Exhibit  D	
                 ***

	Exhibit  E	
                 ***

	Exhibit  F	
                 ***

	Exhibit  G	
                 ***

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PART 1 –
DEFINITIONS AND EXHIBITS 

	1.1  	Definitions  

For purposes of this Agreement, the
following terms shall be defined as set forth below. As required by the context, defined
terms expressed in the singular form shall be deemed to refer to the plural form and vice
versa. The words “Clause”, “Paragraph”, “Article”,
“Section”, “Exhibit” and like references are references to this
Agreement, unless otherwise specified. Any references herein to this Agreement or to any
other agreement, exhibit, instrument or document will include any and all amendments,
modifications, supplements or substitutions that may be made from time to time to this
Agreement or to any such agreement, exhibit, instrument or document, all as permitted by
this Agreement, unless otherwise specified. 

	1.1.1  	“Agreement”,
“hereof”, “hereto”, “herein” and similar terms shall mean
and/or refer to this Supply Agreement and its respective Exhibits and other documents
attached to this Supply Agreement, as well as all amendments, modifications and
supplements hereto; 

	1.1.2  	"Aircraft"
 shall mean the aircraft  which are or will be designed and  manufactured  by
***.

	1.1.3  	“Airworthiness
Authorities” shall mean the ***, EASA (European Aviation Safety Agency), FAA (United
States Federal Aviation Administration) or such other airworthiness authority by which
the Products may be certified, pursuant to the Technical Specification; 

	1.1.4  	“AOG” shall
mean “Aircraft on Ground”, and that such Aircraft is unable to continue or be
returned to service until appropriate action is taken; 

	1.1.5  	“Agreement”,
“hereof”, “hereto”, “herein” and similar terms shall mean
and/or refer to this Supply Agreement and its respective Exhibits and other documents
attached to this Supply Agreement, as well as all amendments, modifications and
supplements hereto; 

	1.1.6  	“Aircraft” shall
mean any and all aircraft designed and manufactured, or to be designed and manufactured,
by *** ; 

	1.1.7  	***; 

	1.1.8  	***; 

	1.1.9  	"Critical
 Order"  shall mean a Purchase  Order placed on an urgent basis to prevent the
           occurrence of an AOG;

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	1.1.10  	"Customer"
shall mean any owner,  lessee or operator of an Aircraft,  or an appointee of
           such owner, lessee or operator;

	1.1.11  	***
; 

	1.1.12  	"***'s
Logistics  Provider" shall mean the logistics service provider  contracted by ***
           for the transport of all Products;

	1.1.13  	"Exhibit"
 shall mean those  documents,  individually  or jointly,  as listed in Section
           1.2 hereof;

	1.1.14  	***; 

	1.1.15  	"Parties"
shall mean *** and Supplier, taken collectively;

	1.1.16  	"Party"
shall mean each of *** and Supplier, individually;

	1.1.17  	“Price” shall
mean the total amount paid by *** to Supplier in accordance with Section *** of this
Agreement; 

	1.1.18  	“Product” shall
mean all goods, including pieces, parts and components (if applicable) thereof for the
Aircraft to be provided by Supplier under this Agreement, as further described in Exhibit
*** attached hereto as may be amended from time to time and shall include those goods
provided by the Supplier under this Agreement which are intended for ***’s use,
Customer’s use, or for sale as spare parts or production replacements; 

	1.1.19  	“Program” shall
mean all activities related to the design, development, certification, manufacturing,
sales and after-sales support of an Aircraft including, but not limited to Customer
Support; 

	1.1.20  	“Proprietary
Information” shall mean all information or data, whether or not marked or otherwise
specified as proprietary or confidential, related to the Program which concerns a Party’s
technology, trade secrets, know-how, existing or future products or financial or
corporate information. This information may include, but is not limited to, information
relating to: inventions, computer software programming and technology, research,
development of new products, engineering, manufacturing processes, purchasing data,
make-or-buy plans, business plans, accounting, marketing, sales or pricing data. Such
information or data may be contained in materials such as drawings, designs, engineering
releases, tools, master tools, models, samples, databases, datasets, specifications,
algorithms, manuals, reports, compilations, research, patent applications, computer
programs, machine-readable data (such as electronic files) and marketing and financial
information and plans, and any information derived or compiled in whole or in part
therefrom. Such information and data includes but is not limited to information received
by a Party which the Party is obligated, contractually or otherwise, to hold in
confidence; 

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	1.1.21  	“Purchase
Order” shall mean any purchase order issued by *** to Supplier, for supply of
Products in accordance with this Agreement; 

	1.1.22  	***;

	1.1.23  	“Shipset” shall
mean the necessary quantity of a group of Products to be utilized on the
production/assembly of one Aircraft. 

	1.1.24  	“Stop
Work Notice” shall mean the notice *** is entitled to give to Supplier pursuant to
Section 8.1 herein; 

	1.1.25  	“Subcontractor” shall
mean any manufacturer and/or supplier, excluding Supplier, which manufactures and/or
supplies any portion or part of the Products, pursuant to the instructions and/or
contract of Supplier; 

	1.1.26  	"Supplier"
shall mean SUMMIT AVIATION SUPPLY

	1.1.27  	***; 

	1.1.28  	“Technical
Specification” shall mean the Product technical requirements necessary for Supplier
to design and/or manufacture the Product. 

	1.2  	Exhibits  

	Exhibit  A	
                 ***

	Exhibit  B	
                 ***

	Exhibit  C	
                ***

	Exhibit  D	
                 ***

	Exhibit  E	
                 ***

	Exhibit  F	
                 ***

	Exhibit  G	
                 ***

In the event any conflict exists
between the terms and conditions set forth in the Exhibits hereto and those terms and
conditions set forth in this Agreement, the terms and conditions of this Agreement shall
prevail. A conflict shall not be deemed to exist when this Agreement and an Exhibit hereto
address different or specific situations or activities. 

PART 2 – OBJECT OF
AGREEMENT 

	2.1  	Subject
of Agreement  

According to the terms and conditions
of this Agreement, Supplier agrees to manufacture, test, supply, ship and provide logistic
support to the Products for use or installation into an Aircraft or an Aircraft part. 

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*** does not guarantee to Supplier:
(i) any minimum amounts of Products to be purchased by ***; (ii) any minimum amount of
Products to be purchased by *** in any Purchase Order; (iii) any minimum amount of money
to be paid by *** pursuant to this Agreement; (iv) any constant or fixed number of
Purchase Orders to be placed by *** with Supplier in any given period of time; and/or (v)
the use of Products in any of its Customer programs. No financial obligation of *** to pay
any amount of money to Supplier will arise before the delivery of conforming Products
following the issuance of a valid Purchase Order, according to the terms and conditions of
this Agreement, and the placement of Purchase Orders by *** will be within ***’s sole
discretion. The parties agree that ***, at any time during the life of this Agreement and
in its sole discretion, may purchase similar or comparable products and/or services from
other suppliers. 

Supplier agrees to supply Products to
any ***’s subsidiary, branch or affiliate company, with no restrictions, under the
same terms and conditions set forth hereunder through solely the placement of the Purchase
Order as provided in Section 4.1 herein below. 

	2.2  	***  

*** 

	2.3  	***  

*** 

PART 3 – PRICES AND
PAYMENT 

	3.1  	General
Terms  

All prices and payments referred to
in this Agreement are set forth in *** (***). *** 

The Price of the Products is set
forth in the Exhibit *** to this Agreement. 

All Prices set forth in this
Agreement *** and/or in accordance with this Agreement and with the Purchase Orders. 

*** 

*** 

	3.2  	Adjustment  

*** 

	3.3  	***  

*** 

	3.4  	***  

*** 

	3.5  	Payment  

*** 

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PART 4 – PURCHASE
ORDERS, DELIVERY AND ACCEPTANCE 

	4.1  	Purchase
Orders  

	 	           4.1.1 	General

*** 

	 	4.1.2 	Purchase
Orders Standard Lead Time 

*** 

	 	4.1.3 	*** 

*** 

	 	           4.1.4 	***

*** 

	4.2  	Delivery  

	 	4.2.1 	General 

Supplier shall deliver the Products
on the dates set forth in the Purchase Orders, ***, in the *** condition, according to
ICC’s INCOTERMS 2000, ***. Supplier will comply with the provisions of *** set forth
in Exhibit ***. 

Supplier shall deliver any Product
required to be delivered pursuant to this Agreement and necessary for ***, ***, ***, ***,
and *** condition set forth in the preceding paragraph. 

	 	4.2.2 	Procedures 

*** 

	 	4.2.3 	Packing
and Shipping 

*** 

	4.3  	Acceptance
and Rejection  

*** 

	4.4  	Return  

*** 

PART 5 – TECHNICAL
REQUIREMENTS  

	5.1  	Technical
Specifications  

Products are based on Technical
Specifications, which may be standard of the market or issued by Supplier or by ***, as
set forth in Exhibit ***. 

*** 

*** 

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	5.2  	Interchangeability  

Supplier agrees to maintain its
Products competitive in the marketplace and to use the most appropriate techniques and
technologies available in the industry. 

Supplier shall ensure that any
improvement or upgrade of the Products is fully interchangeable (same fit, form and
function) with former versions of the Products, unless otherwise previously and
specifically agreed in writing by ***. 

Even if an improvement or upgrade of
the Product does not affect the form, fit, function and/or part number of the Product,
Supplier shall submit information on such improvement or up grade to ***’s approval,
within *** (***) *** before such modification, detailing the technical differences with
the current Products. Supplier shall make all efforts to provide information necessary to
*** analyses and approvals (including, but not limited to, qualification tests reports and
audits). 

	5.3  	***  

*** 

	 	           5.3.1 	***

*** 

	5.4  	***  

*** 

PART 6 – Quality
Requirements 

	6.1  	Quality
Requirements  

Supplier shall comply with ***’s
quality requirements (“Quality Requirements”) made available through ***. For
informational purposes only, such Quality Requirements are attached hereto as Exhibit ***. 

*** 

*** 

*** 

	6.2  	Source
Inspection  

At any time, *** may, at its sole
discretion, elect to inspect Products, Spare Parts, Technical Publications and/or
processes related to commercial, engineering, quality and material processing control
relating to Supplier’s performance under this Agreement at source, including all
Product packing and accompanying documentation at the delivery point, by providing
Supplier with a prior written notice at least *** (***) *** before the date of the
intended inspection. 

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Supplier agrees that the
Airworthiness Authority representatives shall be entitled to inspect and evaluate Supplier
including, but not limited to, Supplier’s facilities, systems, data, equipment,
personnel, testing and all work-in-process and completed work. 

Supplier shall cause its
Subcontractors to authorize *** and/or Airworthiness Authority to conduct such inspections
on the same basis. 

Supplier shall be responsible for the
payment or reimbursement to ***, as the case may be, of any and all costs and expenses
incurred by *** in connection with source inspections and any other actions that may be
necessary, at ***’s discretion, as a result of Supplier’s recurring
non-compliance with the terms of this Section 6, including costs incurred by *** with air
ticket and lodging to carried out inspection arising out of Supplier’s
non-compliance. 

PART 7 – FURTHER
OPERATIONAL PROCEDURES  

	7.1  	***  

*** 

	 	7.1.1 	*** 

*** 

	7.2  	Subcontracting  

*** may, at any time during the
performance of this Agreement, review Supplier’s make-or-buy plan and source
selection for Products and/or tooling considered critical by *** because of process
requirements or manufacturing complexity, and veto Subcontractors. 

Supplier agrees that it shall not
subcontract any other aircraft manufacturer or respective subsidiaries, branches or
affiliated companies for the performance of this Agreement. 

Supplier is responsible for its
supply chain process, including, but not limited to its suppliers manufacturing process. 

	7.3  	Program
Surveillance  

Subject to Section 6.2, Supplier
hereby grants, and shall cause Subcontractors to grant, to *** and Customers the right to
visit the Supplier or Subcontractors’ facilities during operating hours to review
progress and performance of production, schedule, cost, quality and protection of
***’s Proprietary Information. Supplier agrees and shall cause Subcontractors to
agree that any *** or Customer authorized representative shall be allowed access to all
areas used for the performance of this Agreement. Such access shall be subject to the
regulations of any governmental agency regarding admissibility and movement of personnel
on Supplier’s or Subcontractors’ premises. 

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Each Party (the “Indemnifying
Party”) hereby agrees to indemnify and hold the other Party and the other
Party’s officers, employees and agents (collectively the “Indemnified
Party”), harmless from and against all actions, claims, demands, liability, losses,
costs and expenses (including the reasonable costs of defending and the actual costs of
settling any action, claim or demand) for personal injury, death or property loss which
may be brought or made against or suffered or incurred by the Indemnified Party, solely
caused by the Indemnifying Party’s representatives while upon the Indemnified
Party’s property and while carrying out their activities under the Program. 

	7.4  	Procurement
Offset Credits  

With respect to work covered by this
Agreement, Supplier agrees to use its best reasonable efforts to cooperate with *** in the
fulfillment of any offset obligation that *** may have accepted as a condition for the
sale of any Product or Aircraft. 

	7.5  	***  

*** 

	 	7.5.1 	***

*** 

	 	           7.5.2 	***

*** 

	7.6  	***  

*** 

PART 8 – SUSPENSION,
TERMINATION, ***, AND ***  

	8.1  	Suspension  

*** may at any time, by written
notice to Supplier (a “Stop Work Notice”), require Supplier to stop all or any
part of the work called for by this Agreement. Upon receipt of a Stop Work Notice,
Supplier shall promptly comply with its terms and take all reasonable steps to minimize
the costs arising from the work covered by the Stop Work Notice. Within the period
specified in the Stop Work Notice, *** shall either (i) cancel the Stop Work Notice or
(ii) terminate this Agreement in whole or part, or (iii) cancel the work covered by the
Stop Work Notice. In the event *** cancels the Stop Work Notice Supplier shall promptly
resume work in accordance with the terms of this Agreement. 

	8.2  	***  

	 	           8.2.1 	General
Terms

*** 

In the case of a total termination,
Supplier shall immediately upon said termination stop all work in any way related to this
Agreement and return to *** any and all equipment, and documentation, technical or not,
including, but not limited to Proprietary Information, drawings and blueprints which are
the property of ***. 

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Within *** (***) *** of the effective
date of the Termination Notice, each Party hereto shall issue to the other a termination
statement (“Termination Statement”). Any Termination Statement, whether from ***
or Supplier, shall contain sufficient details, verifiable by third party audit, to support
the amount being claimed. Supplier’s Subcontractors shall not submit termination
claims directly to ***. 

	 	           8.2.2 	Payments

*** 

	 	8.2.3 	*** 

*** 

	8.3  	***  

*** 

	8.4  	***  

*** 

	8.5  	Right
to Set-Off  

Notwithstanding the foregoing and
without prejudice to other rights and remedies, *** will have the right, at its option, to
set off any amounts due by *** to Supplier against any amounts due by Supplier to ***,
including but not limited to damages recoverable by ***. 

	8.6  	***  

*** 

	 	           8.6.1 	***

*** 

	 	           8.6.2 	***

*** 

	 	           8.6.3 	***

*** 

	 	           8.6.4 	***

*** 

PART 9 –
Miscellaneous  

	9.1  	***  

*** 

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	9.2  	Supplier
Representations  

Supplier represents that it is fully
competent and maintains adequate resources to perform all the work required for providing
the Products in accordance with the terms of this Agreement. *** and Customers are
entitled to rely upon Supplier as an expert. Supplier hereby further represents that all
requirements of the Airworthiness Authorities, in regard to the Products have been or
shall timely be complied with by Supplier. Such representations in this Section shall
survive *** (***) *** following the termination of this Agreement. 

	9.3  	***  

*** 

	9.4  	***  

*** 

	9.5  	***  

*** 

	 	           9.5.1 	Intellectual
Property Infringement Indemnification

Supplier hereby indemnifies, and
shall defend and hold harmless *** and all of ***’s subsidiaries and all officers,
agents and employees of *** and any Customer from and against all claims, suits, actions,
awards, judgments, settlements (including, but not limited to, awards based on intentional
infringement of patents or copyrights known to Supplier), liabilities, damages, costs and
attorney’s fees related to the actual or alleged infringement of any intellectual
property rights as defined by ***, United States or other nation’s intellectual
property laws arising out of the manufacture, sale or use of Products, technical
publications or services by either Supplier, *** or any Customer. 

*** and/or any Customer shall duly
notify Supplier of any such claim, suit or action, and Supplier agrees to, at its own
expense, fully defend such claim, suit or action on behalf of *** and all of ***’s
subsidiaries and all officers, agents and employees of *** and/or any Customer, provided,
however, that Supplier shall keep *** well-informed with respect to any and all actions to
be taken by Supplier; *** shall have the right to interfere in such actions whenever ***
believes that such action may prejudice itself; and Supplier shall not settle, compromise
or discharge, or admit any liability with respect to, any such claim without the prior
written consent of ***. 

Notwithstanding the foregoing,
Supplier shall have no obligation under this Agreement with regard to any infringement
arising from: (i) Supplier’s compliance with formal specifications issued by ***
where infringement could not be avoided in complying with such specifications or (ii) use
or sale of Products in combination with other items when such infringement would not have
occurred from the use or sale of those Products solely for the purpose for which they were
designed and sold by Supplier. 

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	9.6  	Insurance  

Supplier hereby represents that:
Supplier has and agrees to maintain comprehensive Products liability and Grounding
coverage through a rated insurance company for the amount of *** per occurrence; and (ii)
Supplier will cause Supplier’s main supplier in terms of Product part numbers
described in the Exhibit *** of this Agreement (***) will maintain comprehensive Products
liability and Grounding coverage through a rated insurance company for the amount of ***
per occurrence, both throughout the term of this Agreement. Supplier shall also maintain
*** Insurance, covering incidents, risks and other situations, as it might be required by
law or agreed upon between the Parties. 

The insurance policies shall in all
cases be in form and amounts above mentioned, and issued by insurance companies of
reasonably known capacity reasonably known capacity, satisfactory to ***, which will not
unreasonably refuse its approval. In the event ***’s insurance company requires an
increase in such amounts, Supplier and *** will mutually agree on the amount in good
faith. 

*** may request, at any time during
this Agreement, copies of the above mentioned policies and/or material evidence that the
insurance coverage’s are in full force end effect. 

	9.7  	***  

*** 

	9.8  	Publicity  

No information relating to the
subject matter of this Agreement including, without limitation, news releases,
photographs, films, advertisements, public announcements and denials or confirmations of
such public announcements, shall be disclosed or otherwise made available by Supplier to
any third party without ***’s prior written consent. Supplier agrees to reasonably
assist in advertising campaigns and promotion for the Aircraft as directed by ***. Without
prejudice to the terms of this section 9.8, *** agrees that Supplier can announce the
execution of this Agreement. 

	9.9  	Customer
Contact  

*** is the only responsible for all
contact with Customers regarding the Program and the Aircraft, as well as any other ***
model aircraft programs. Supplier shall not make any contact with actual or potential
Customers on the subject of the Program or without ***’s prior written consent; and
Supplier shall respond to any inquiry from actual or potential Customers regarding the
Program and the Aircraft by requesting that the inquiry be directed to ***. Supplier
shall, concurrently with such response, advise *** of such inquiry. 

	9.10  	Taxes
and Duties  

Each Party will be responsible for
all taxes, fees, levies, imposts, penalties, excises, surcharges and import and export
charges and other duties imposed by any governmental authority or subdivision thereof
which may be assessed against or incurred by such Party as a result of its performance
under this Agreement; provided, however, that Supplier agrees to pay and be responsible
for, and to hold *** harmless, on an after-tax basis, from: 

     (i)    
          All taxes, fees and duties associated with the manufacture of Products and
          passage of title and delivery of said Products to ***, except that Supplier
          shall not be responsible for any customs duties, tariffs or sales or use taxes
          assessed in *** in regard to any Product for which *** has accepted title other
          than those duties which may be assessed pursuant to the item (ii) below; and 

Page 15 of 21

CONFIDENTIAL 

CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED FOR THE REDACTED PORTIONS OF THIS DOCUMENT WHICH ARE MARKED AS FOLLOWS: [*], AND
THE REDACTED PORTIONS HAVE BEEN FILED SEPARATELY WITH THE SEC. 

     (ii)    
          All taxes, fees and duties on any property furnished by *** to Supplier
          including but not limited to data, information, materials, parts or tools, and
          Supplier agrees to, when required by the property owner in a timely manner,
          declare, file, register and/or pay all such taxes on behalf of *** and keep ***
          informed of all such activities and provide supporting documentation as
          requested. 

     (iii)    
          In any case in which a penalty, tax, fee, duty, impost, levy, excise, surcharge
          or import / export charge is charged or claimed against *** by the *** customs
          or other competent authorities due to the non-compliance by Supplier with
          ***’s Shipping Policy, Supplier shall reimburse *** the corresponding
          values so charged or claimed against ***. 

	 	9.10.1 	Labor
Taxes 

Each Party shall be responsible for
all tax reports and tax payments and for the payment of social welfare contributions and
compliance with all social welfare or other applicable regulations required to be made or
discharged by employers under the laws of the other Party’s central or local
government, where applicable, with respect to its employees stationed at the other
Party’s locations. 

	9.11  	Survival  

Without limiting any other survival
provision contained herein and notwithstanding any other provision of this Agreement to
the contrary, the representations, covenants, agreements and obligations of the Parties
set forth in this Agreement, shall survive any cancellation, termination, expiration
and/or any assignment of this Agreement, or of any payment and performance of any or all
of the other obligations of the Parties hereunder, including those obligations contained
in the following provisions: (i) Applicable Law, (ii) Assignment, (iii) Compliance with
Laws, (iv) Dispute Resolution, (v) Export Control Compliance, (vi) Independent
Contractor’s, (vii) Indemnification, (viii) Intellectual Property, (ix) Intellectual
Property Infringement Indemnification, (x) Insurance, (xi) Nonwaiver, (xii) Proprietary
Information, (xiii) Remedies, (xiv) Remedies Not Exclusive, (xv) Severability, (xvi)
Supplier Representations, (xvii) Restrictions, (xiii) Surplus Products, (xix) Survival of
Warranties, (xx) Survival and (xxi) Obsolescence. 

	9.12  	Amendment  

This Agreement may only be altered,
amended or supplemented by a written instrument executed by the Parties, except where
otherwise provided herein. 

Page 16 of 21

CONFIDENTIAL 

CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED FOR THE REDACTED PORTIONS OF THIS DOCUMENT WHICH ARE MARKED AS FOLLOWS: [*], AND
THE REDACTED PORTIONS HAVE BEEN FILED SEPARATELY WITH THE SEC. 

	9.13  	Assignment  

Neither Party shall assign any of its
rights hereunder, including, without limitation, rights to monies due or to become due
hereunder, or delegate any of its duties hereunder without the prior written consent of
the other. 

	9.14  	Compliance
With Laws  

Each Party shall be responsible for
complying with all laws, including, but not limited to, any statute, rule, regulation,
judgment, decree, order or permit applicable to its performance under this Agreement and
agrees to indemnify and to hold harmless the other Party from any failure by the former to
comply with any provisions of such laws. Each Party further agrees (i) to notify the other
of any obligation under this Agreement which is or may become prohibited under applicable
law, at the earliest opportunity but in all events, where applicable, sufficiently in
advance of the former’s performance of such obligation so as to enable the other to
identify alternative methods of performance that will comply with applicable law, (ii) to
notify the other at the earliest possible opportunity if the former’s performance of
any aspect of its obligations under the Agreement will subject the other to liability
under applicable laws, and (iii) to notify the other at the earliest possible opportunity
of any aspect of the former’s performance which becomes or which the former
reasonably believes will become subject to additional regulation after the date of
execution of this Agreement. 

	9.15  	Headings  

Headings used in this Agreement are
for convenience of reference only and shall not affect the interpretation of this
Agreement. 

	9.16  	Severability  

If any provision in this Agreement is
or becomes void or unenforceable by force or operation of law, the other provisions shall
remain valid and enforceable. 

	9.17  	Export
Control  

	  	9.17.1       
Supplier
represents and warrants that it will comply with all applicable laws related to the
export, re-export and transfer of the Product and its associated software and technology
under this Agreement. Without limiting the generality of the foregoing, Supplier further
represents and warrants that:  

    a)        it
shall ensure that any Product and its associated software and technology that
          is subject to the jurisdiction of the United States Export Administration
          Regulations (“EAR”), the International Traffic In Arms Regulations
          (“ITAR”), or other applicable export control or economic sanctions
          laws, is not (i) exported, transferred or released from the United States or by
          United States persons or (ii) exported, re-exported, transferred or released
          from countries other than the United States, without first complying with all
          requirements of the EAR, ITAR, or other applicable export control or economic
          sanctions laws including the requirement for obtaining an export license, if
          applicable;  

Page 17 of 21

CONFIDENTIAL 

CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED FOR THE REDACTED PORTIONS OF THIS DOCUMENT WHICH ARE MARKED AS FOLLOWS: [*], AND
THE REDACTED PORTIONS HAVE BEEN FILED SEPARATELY WITH THE SEC. 

    b)        it
will timely inform *** in writing and in good faith of the existence and           nature
of any restriction that the government of Supplier’s country and/or           the
government of the United States imposes or may impose on the export,           re-export,
transfer or release of the Product and its associated software and           technology.  

	  	9.17.2       
Upon
execution of this Agreement, and at anytime upon ***’s request, Supplier shall
deliver the Product export control classification sheet attached hereto as Exhibit ***,
completed and signed by a duly authorized officer of Supplier. Supplier shall also submit
the Product export control classification sheet to *** immediately following any changes
to the information previously provided.  

	  	9.17.3       
If
an export license is required for the export, re-export, transfer, or release of any
Product and associated software and technology supplied under this Agreement, Supplier
shall timely obtain such license and shall provide *** with copies of the license,
license application, and related export control documentation (transmittal letter, etc).
Denial of a license will only be construed as excusable delay under this Agreement if the
license is denied for reasons not attributable to Supplier and after Supplier has
demonstrated to ***’s satisfaction that (a) Supplier filed with the proper
governmental authorities the license application and documents in support of the license
application pursuant to the applicable laws and regulations, including a comprehensive
and complete letter to the relevant governmental agency explaining the details of the
export, re-export, transfer, or release and (b) Supplier used its best efforts to obtain
approval of the license application. *** may, in its sole discretion, request a legal
opinion from Supplier’s counsel, acceptable to *** and at Supplier’s expense,
confirming that Supplier has complied with the above. Denials of licenses in all other
circumstances will not be construed as excusable delay.  

	  	9.17.4       
Supplier
shall immediately notify *** if Supplier is, or becomes, listed on any U.S. or other
government list of restricted or prohibited persons, or if Supplier’s export
privileges are otherwise denied, suspended or revoked in whole or in part by any
government entity or agency.  

Page 18 of 21

CONFIDENTIAL 

CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED FOR THE REDACTED PORTIONS OF THIS DOCUMENT WHICH ARE MARKED AS FOLLOWS: [*], AND
THE REDACTED PORTIONS HAVE BEEN FILED SEPARATELY WITH THE SEC. 

	9.18  	Nonwaiver  

No failure on the part of either
Party in exercising any right or remedy hereunder, or as provided by law or in equity,
shall impair, prejudice or constitute a waiver of any such right or remedy, or shall be
construed as a waiver of any event of default or as acquiescence therein. No single or
partial exercise of any such right or remedy shall preclude any other or further exercise
thereof or the exercise of any other right or remedy. No acceptance of partial payment or
performance of any of Supplier’s or ***’s obligations hereunder shall constitute
a waiver of any event of default or a waiver or release of payment or performance in full
by Supplier or *** of any such obligation. 

	9.19  	Applicable
Law  

This Agreement shall be subject to
and governed by the laws of the United States and the State of New York, excluding their
choice-of-law principles (other than section 5-1401 and 5-1402 of the New York General
Obligations Law). The United Nations Convention on Contracts for the International Sale of
Goods, 1980, and any successor thereto, will not apply. Any suit must be brought to the
arbitration panel mentioned in Section 8.20, and the Parties irrevocably consent to
personal and exclusive jurisdiction and forum of, and agree to be bound by any arbitration
award rendered by these arbitrators. 

	9.20  	Dispute
Resolution  

*** and Supplier hereby agree to
attempt to resolve through negotiation any and all disputes between *** and Supplier,
arising out of or in connection with this Agreement or its performance, including, but not
limited to, any questions regarding the existence, validity or termination hereof. At any
time, however, if a Party decides not to pursue negotiations any longer, said dispute
shall be finally settled by binding arbitration. If arbitration is so initiated, it will
be conducted in the English language, will take place in New York, USA and will be
conducted in accordance with the Rules of Arbitration of the International Chamber of
Commerce of Paris, as they may be modified by this Section (the “Rules”), by
three arbitrators appointed in accordance with said Rules. Arbitrators must have
experience in deciding complex commercial cases, and should preferably have aircraft
industry background. 

	9.21  	Remedies
not Exclusive  

The rights and remedies set forth in
this Agreement are not exclusive, except in case the remedy is indicated herein as
exclusive, and nothing contained in this Agreement shall be deemed to diminish or
eliminate any right or remedy which *** may have at law or in equity. 

	9.22  	Independent
Contractors  

The relationship between *** and
Supplier shall be that of independent contractors and not of an agent for or partner of
the other for any purpose whatsoever. Neither Party shall represent itself as the agent or
legal partner of the other Party or do any act or thing which might result in other
persons believing that it has authority to contract or in any other way to enter in
commitments on behalf of the other. 

Page 19 of 21

CONFIDENTIAL 

CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED FOR THE REDACTED PORTIONS OF THIS DOCUMENT WHICH ARE MARKED AS FOLLOWS: [*], AND
THE REDACTED PORTIONS HAVE BEEN FILED SEPARATELY WITH THE SEC. 

	9.23  	Changes
to Supplier Ownership or Affiliation  

If at any time Supplier becomes owned
or controlled by or merges with any person or entity which competes with *** aircraft or
enters into a substantial risk sharing arrangement which risk sharing arrangement is
involved in a undertaking which competes with *** aircraft, Supplier shall notify *** in
advance, and *** may terminate this Agreement by providing written notice to Supplier.
Further, in the event that transfer of de facto control, or of a material part, of
Supplier’s business to a third party is contemplated, Supplier shall give timely
notice to ***, but no less than within *** (***) *** prior to any such transfer or, in the
event Supplier does not have knowledge of such transfer prior to its occurrence, Supplier
agrees to give notice to *** within *** (***) *** after said occurrence. Upon such
notification, *** may, at its sole discretion, renegotiate with Supplier mutually
acceptable terms to continue this Agreement or terminate this Agreement without any
liability to ***, other than the payment by each party of the amounts specified in Section
8.2 of this Agreement. 

	9.24  	Notices,
Requests and Language  

All notices and requests in connection
with this Agreement shall be given in English and in writing and may be given by airmail,
facsimile or any other customary means of communication to the contract administrators of
the Program that each Party shall indicate to the other at the appropriate time. 

The effective date of any notice or
request given in connection with this Agreement shall be *** (***) *** after the receipt
by the addressee. 

The language of this Agreement and
all other documents in any way relating to this Agreement is the English language. In the
event this Agreement or any other document in any way relating to this Agreement is
translated into another language or is issued in more than one language, the version which
shall prevail for all purposes whatsoever is the version written in the English language. 

	9.25  	Term
of Agreement  

Unless earlier terminated in
accordance with the provisions of this Agreement, or renewed by written agreement of the
Parties prior to the expiration this Agreement shall be valid and effective between the
Parties until December 31st, 2012, and at ***’s discretion may be renewed for
additional periods of *** (***) ***. *** shall formalize to Supplier, at least *** ***
prior to the end of the Agreement, intention to extend such Agreement for an additional
*** *** period. 

Page 20 of 21

CONFIDENTIAL 

CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED FOR THE REDACTED PORTIONS OF THIS DOCUMENT WHICH ARE MARKED AS FOLLOWS: [*], AND
THE REDACTED PORTIONS HAVE BEEN FILED SEPARATELY WITH THE SEC. 

	9.26  	Entire
Agreement  

This Agreement, including all
attachments hereto, constitutes the final, complete and exclusive agreement between the
Parties relating to the subject matter hereof and cancels and supersedes all previous
agreements between the Parties relating thereto, whether written or oral. Furthermore, the
terms and conditions contained in this Agreement do not create or represent a precedent
for the interpretation of any other agreements that have been or will be executed between
the Parties not relation to the subject matter hereof. 

IN WITNESS WHEREOF, the Parties have
caused this Agreement to be duly executed and delivered by their proper and duly
authorized officers, and to be effective as of the day and year first above written. 

	***

***
——————————————

Name:   ***
Title:   ***		Summit Aviation Supply

/s/ Andrew Levi
——————————————

Name:   Andrew Levi
Title:   President 

	
***
——————————————

Name:   ***
Title:   ***		
/s/  Paul Cooperman
——————————————

Name:   Paul Cooperman
Title:   Manager

WITNESSES 

	
***
——————————————

Name:   ***
ID:   ***		
 
——————————————

Name: 
ID: 

Page 21 of 2120-F

Exhibit 4.16  

LOAN AGREEMENT  

        THIS
LOAN AGREEMENT (the “Agreement”) is made as of the __th day of
_______, 2009, by and among B.O.S Better Online Solutions Ltd. (the
“Company”), and each of the lenders listed on Schedule A hereto,
severally (the “Lender(s)”). 

W I T N E S S E T H: 

        WHEREAS,
the Company wishes to borrow from each Lender, severally, and the Lenders wish to extend
to the Company loans in the aggregate amount of up to US$3,750,000 (the
“Loan”); 

        NOW,
THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the Company and the Lenders hereby agrees as follows: 

      Section 1.
        Loan and Warrant.  

    1.1.        Disbursement.
Upon the terms and subject to the conditions set forth in           this Agreement and on
the basis of the Company representations and warranties           hereinafter set forth
in Section 4 hereto, subject to the fulfillment of the           condition precedent
listed in Section 6 below each Lender hereby undertakes           within 3 Business Days
from the date hereof (the “Closing           Date”) to deliver to the
Company the amount listed next to such           Lender’s name on Schedule A,
(without deduction of any fees or           taxes) by means of a wire transfer of
immediately available funds to the           Company’s bank account, Account
___________, at ___________, Routing no:           ___________, Business Branch No.
___________, Swift Code: ___________. For           purposes of this Agreement, the term
“Business Day” means any day on           which banks in Israel are open and
execute foreign exchange transactions. It is           expressly agreed that Schedule A may
be unilaterally amended by the           Company from time to time, to include additional
Lenders, which shall execute a           copy of the Agreement.  

    1.2.        Issuance
of Warrant. On the Closing Date, the Company shall issue and           deliver to
each Lender who delivered its applicable amount listed on Schedule           A, a
Warrant in the form attached hereto as Schedule B (the           “Warrant”)
to purchase the amount of Ordinary Shares of the           Company, nominal value NIS
4.00 each (each, a “Share” and           collectively, the “Shares”)
equal to the number of Shares           issuable upon conversion of the entire Loan
extended by such Lender (100%           warrant coverage), all as listed next to such
Lender’s name in Schedule           A (the “Warrant Shares”).
Each Warrant shall be exercisable           for a period of 18 months commencing on the
date that is 18 months from the           Closing Date and shall expire on the Maturity
Date (as defined below). Each           Warrant’s exercise price shall be $0.55 per
Share (subject to adjustment in           the event of share splits or consolidations,
issuance of bonus shares, and           similar recapitalization events).  

     Section 2.
        Loan Terms.  

    2.1.        Term
of Loan. The term of the Loan shall commence on the Closing Date and           shall
terminate, upon payment in full of all outstanding principal and interest
          hereunder or conversion in full pursuant to Section 2.4 hereof, on the date
that           is 36 months from the Closing Date (the “Maturity Date”),
          unless, as a result of Default (as defined in Section 3 herein) or subject to
          the prior written consent of the Lender, paid in full prior to such date, in
          which event the term shall expire immediately upon such payment, in full (the
          “Term”).  

    2.2.        Interest.
The annual rate of interest on the Loan shall be 8% (the           “Interest”).
Interest on the Loan shall accrue starting from           the Closing Date, shall be
compounded annually and will be calculated on the           basis of a 360-day year and
pro rated with respect to any portion thereof,           respectively to the actual date
of payment.  

    2.3.        Payment.
The principal and Interest on the Loan, together with applicable           value added
tax and subject to any tax withholding, applicable with respect to           the
Interest, shall be paid to each Lender’s account, as stated next to           such
Lender’s name in Schedule A, on the Maturity Date.  

    2.4.        Conversion.
Any Lender may, at any time until the Maturity Date, by           giving at least 30-days
prior written notice to the Company , or upon the           occurrence of a Default event
listed in Section 3 below, convert the principal           amount plus Interest (subject
to applicable withholding tax) accrued on its           portion of the Loan to Shares at
a conversion price of $0.65 per Share (subject           to adjustment in the event of
share splits or combinations, consolidations,           mergers, issuance of bonus
shares, reclassifications and similar           recapitalization events) (the “Conversion
Shares”).  

     Section 3.
        Default.  

Without derogating from the
generality of the provisions of this Loan Agreement, each Lender shall be entitled to
demand the immediate repayment of its respective portion of the Loan Amount, upon the
occurrence of any one of the events enumerated below (a “Default”), in which
case the Company undertakes to pay the Lender(s) all of the Loan Amount due to it and any
accrued Interest, and each Lender shall be entitled to take whatever steps it deems fit
for the collection of the Loan and Interest as provided under this Agreement 

    3.1.        the
Company is unable to pay its debts as they come due, makes a general           assignment
for the benefit of its creditors, or files for voluntary liquidation;  

    3.2.        the
filing against the Company of any petition in liquidation or any petition           under
the provisions of applicable law for the relief of creditors or a           liquidator or
receiver is appointed for or over all of or a substantial part of           the assets of
the Company, if such petition or appointment is not dismissed or           stayed within
sixty (60) days;  

    3.3.        Any
representation made by the Company in this Agreement was false or materially
          inaccurate, subject to receipt of 5 Business Days prior notice;  

    3.4.        the
Company fails to duly perform or comply with any of its covenants or other
          obligations under this Agreement and (if capable of remedy) such failure is not
          remedied within 21 Business Days, after the Lenders provide written notice
          thereof to the Company.  

    3.5.        the
Company adopts a resolution for a merger with and into a third party, where           the
Company is not the surviving entity (excluding, for the avoidance of doubt,
          reorganization among the Company and its subsidiaries) or a sale of all or
          substantially all of the Company’s assets, in each case where such event
          may reasonably be deemed to have a material adverse effect on the Lenders
          ability to receive the Loan repayment hereunder.  

2

     Section 4.
        Representations and Warranties by the Company.  

        The
Company hereby represents and warrants to the Lenders that: 

    4.1.        Corporate
Organization. The Company is a public corporation traded on           NASDAQ and duly
incorporated and validly existing under the laws of Israel, and           has the
corporate power to own its property and to carry on its business as now           being
conducted.  

    4.2.        Due
Authorization and Valid Issuance. The Company has the corporate power           to
enter into this Agreement and the Registration Rights Agreement (the           “Transaction
Documents”). The Transaction Documents have been           duly approved by the
necessary corporate bodies, executed and delivered by the           Company. The
Conversion Shares and Warrant Shares will, upon issuance and           payment therefore
pursuant to the terms hereof, be duly authorized, validly           issued, fully-paid
and nonassessable, free of any preemptive rights and are free           and clear of any
liens, claims, encumbrances or third party rights of any kind.  

    4.3.        
Binding Agreement. The Transaction Documents constitute a valid and
          legally binding obligation of the Company enforceable against the Company in
          accordance with their terms, except as (i) such enforceability may be limited
by           bankruptcy, insolvency, reorganization, arrangement, moratorium or similar
laws           relating to or affecting the rights of creditors and contracting parties
          generally, (ii) the remedy of specific performance and injunctive and other
          forms of equitable relief may be subject to equitable defenses and to the
          discretion of the court before which any proceeding therefore may be brought,
          and (iii) rights to indemnity and contribution may be limited by Israeli or
U.S.           state or federal securities laws applicable to the Company or by the
public           policy underlying such laws.  

    4.4.        Non-Contravention.
Neither the execution and delivery of the Transaction           Documents, nor the
consummation of the transactions or the performance of the           obligations
contemplated hereby will result in any violation or breach of the           Company’s
articles of association, by-laws, board resolutions or           shareholders
resolutions.  

    4.5.        No
Consent. In reliance on the representations of the Lenders given in           Section
5 hereof, except for reporting obligations and approvals required under
          applicable security laws and market regulations in Israel and the United States
          and for notices (coupled with customary undertakings by foreign Lenders) to or
          approvals by the Office of the Chief Scientist and the Investment Center of the
          Ministry of Industry, Trade and Labor (if required), no consent of any
          governmental body or third party is required to be made or obtained by the
          Company in connection with the execution and delivery of the Transaction
          Documents by the Company or the consummation by the Company of the transactions
          or the performance of the obligations contemplated therein by the Company.  

    4.6.        Capitalization.
The authorized share capital of the Company consists of           35,000,000 Ordinary
Shares, nominal value NIS 4.00 per share, of which, as of           May 31, 2009,
___________ Ordinary Shares are issued and outstanding. Schedule A sets forth, to
the Company’s knowledge, the Lenders           holdings assuming the full conversion
of the aggregate Loan amount and exercise           of the Warrants.  

3

    4.7.        Financial
Statements. The audited consolidated financial statements of           the Company as
of December 31, 2008 and the related notes thereto, as filed by           the Company
with the Securities and Exchange Commission (“SEC”)           under Form
6-K on March 31, 2009, fairly present the financial position of the           Company as
of their respective dates, and have been prepared in accordance with           the books
and records of the Company as at the applicable dates and for the           applicable
periods. Such financial statements have been prepared in accordance           with
generally accepted accounting principles applied on a consistent basis
          throughout the periods therein specified, except as may be disclosed in the
          notes to such financial statements, or as may be permitted by the Securities
and           Exchange Commission and except as disclosed in the filings the Company made
in           connection with such statements, if any. To the Company’s knowledge,
the           unaudited consolidated financial statements of the Company as of March 31,
2009,           as filed by the Company with the SEC under Form 6-K on May 18, 2009,
fairly           present the financial position of the Company as of their respective
dates, and           have been prepared in accordance with the books and records of the
Company as at           the applicable dates and for the applicable periods.  

    4.8.        Legal
Proceedings. Except as disclosed in the Company’s public           filings,
there is no material legal or governmental proceeding pending or, to           the
knowledge of the Company, threatened to which the Company is or may be a           party.  

    4.9.        Intellectual
Property. (i) The Company, either directly or through its           subsidiaries,
owns or possesses sufficient rights to use all material patents,           patent rights,
trademarks, copyrights, licenses, inventions, trade secrets,           trade names and
know-how (collectively, “Intellectual Property”)           described or
referred to in the Company’s public filings as owned or           possessed by it,
except where the failure to own or possess would not have a           material adverse
effect on the Company, (ii) to the knowledge of the Company,           the Company is not
infringing, nor has it received any notice of, any asserted           infringement of,
any rights of a third party with respect to any Intellectual           Property that,
individually or in the aggregate, would have a material adverse           effect on the
Company.  

    4.10.        Compliance
with Law. To the knowledge of the Company, the business of the           Company is
conducted in accordance with applicable laws, except to the extent           that,
individually or in the aggregate, would not have a material adverse effect           on
the Company.  

    4.11.        Disclosure.
The representations and warranties of the Company contained           in this Section 4
as of the date hereof and as of the Closing Date, and in the           Company’s
public filings with the SEC, do not contain any untrue statement           of a material
fact or omit to state a material fact necessary to make the           statements herein,
in light of the circumstances under which they are made, not           misleading. The
Company understands and confirms that the Lenders will rely on           the foregoing
representations in effecting the transaction contemplated in the           Transaction
Documents and other transactions in securities of the Company.  

     Section 5.
        Representations and Warranties by the Lenders.  

        Each
Lender represents severally to the Company that: 

    5.1.        Enforceability.
(i) Each Lender is authorized and qualified and has full           right and power to
become an lender to and an investor in the Company, is           authorized to loan its
portion of the Loan to the Company, to convert its           portion of the Loan into
Shares in the event of a conversion pursuant to Section           2.4 hereof, to exercise
its Warrant, and to perform its obligations pursuant to           the provisions hereof,
(ii) the person signing the Transaction Documents and any           other instrument
executed and delivered therewith on behalf of each Lender has           been duly
authorized by such entity and has full power and authority to do so,           and (iii)
no Lender has been formed for the specific purpose of extending the           Loan or of
acquiring an interest in the Company.  

    5.2.        Restrictions
on Transferability and Hedging.  

4

    5.2.1.        Each
Lender understands that, in the absence of an effective registration           statement
or an opinion of the Company’s counsel that registration under           the
Securities Act of 1933 (the “Act”) is not required: (i) the
          Conversion Shares and Warrant Shares, when issued, shall not be registered
under           the Act, or under the laws of any other jurisdiction; (ii) such shares
cannot be           sold, transferred or otherwise disposed of unless they are
subsequently           registered under the Securities Act and, where required, under the
laws of other           jurisdictions or unless an exemption from registration is then
available; (iii)           there is now no registration statement on file with the
Securities and Exchange           Commission with respect to such shares.  

    5.2.2.        Each
Lender acknowledges and agrees that the certificates representing the
          Conversion Shares and the Warrant Shares shall bear restrictive legends,
          substantially as follows, or as may be required in order to comply with
          applicable securities rules and regulations:  

        “The
shares represented by this certificate have not been registered under the Securities Act
of 1933. The shares have been acquired for investment and may not be sold, transferred,
assigned or otherwise disposed of in the absence of an effective registration statement
with respect to the shares evidenced by this certificate, filed and made effective under
the Securities Act of 1933, or an opinion of the Company’s counsel that registration
under such Act is not required.” 

    5.2.3.        The
Company will not register any transfer of Conversion Shares or Warrant           Shares
not made pursuant to registration under the Securities Act, or pursuant           to an
available exemption from registration.  

    5.2.4.        Each
Lender agrees not to engage in hedging transactions with regard to the
          Conversion Shares or the Warrant Shares.  

    5.3.        Offshore
Transaction. Each Lender represents that it is not a “U.S.           Person”,
as such term is defined in Regulation S under the Securities Act           of 1933 (“Reg.
S”), its principal address is outside the United           States and it has no
present intention of becoming a resident of (or moving its           principal place of
business to) the United States. Each Lender was located           outside the United
States at the time any offer in connection with this           Agreement was made to such
Lender and at the time that the Lender accepted any           such offer. The Conversion
Shares and the Warrant Shares if issued, will be           acquired solely for each Lender’s
own account, and in no event and without           derogating from the foregoing, for the
account or the benefit of a U.S. person.           Each Lender shall comply with the
applicable distribution compliance periods           pursuant to Reg. S.  

    5.4.        Investment
Purposes. The Conversion Shares and Warrant Shares, if issued           will be
acquired for investment purposes. Such Shares will not be acquired with           a view
to, or for sale in connection with, any distribution or other disposition
          thereof. No Lender has any present plans to enter into any contract,
          undertaking, agreement or arrangement for any such resale, distribution or
other           disposition, and it will not divide its interest in the Company’s
Shares           with others, resell or otherwise distribute the Company Shares in
violation of           federal or state U.S. Securities laws or the Israeli Securities
Law.  

    5.5.        Information
and Advice.  

    5.5.1.        Each
Lender has carefully reviewed and understands the risks of extending the           Loan
and of the acquisition of the Conversion Shares and Warrant Shares. In
          connection with such Lender’s extension of the Loan and, if applicable,
          investment in the Company, it has obtained the advice of its own investment
          advisors, counsel and accountants (the “Advisors”). Each
Lender           and its Advisors have reviewed the Company’s public filings and
have been           furnished with all materials relating to the Company or the Company
Shares that           they have requested. The Lender and its Advisors have been afforded
the           opportunity to ask questions of the Company concerning the financial and
other           affairs of the Company and to obtain any additional information necessary
to           verify the accuracy of any representations or information set forth herein.  

5

    5.5.2.        The
Company has answered all reasonable inquiries that any Lender or its           Advisors
have made concerning the Company or any other matters relating to the           creation
and operations of the Company and the terms and conditions of the Loan.  

    5.6.        Sophistication
and Risk. Each Lender represents that:  

    5.6.1.        It
has such knowledge and experience in financial and business matters, that it           is
capable of evaluating, and has evaluated, the merits and risks of the Loan           and
the acquisition of the Conversion Shares and Warrant Shares.  

    5.6.2.        It
understands that no Israeli or U.S. federal or state agency has passed upon           the
Shares or made any finding or determination as to the fairness of the
          transactions contemplated in the Transaction Documents.  

    5.6.3.        Without
derogating from any of the Companies representations and warranties           contained
herein, it understands that the Loan and any acquisition of the Shares           involves
a high degree of risk, including the risk that such Lender might lose           its
entire amount invested in the Company.  

    5.6.4.        It
understands that any tax benefits that may be available to the Lenders may be
          lost through adoption of new laws, amendments to existing laws or regulations,
          or changes in the interpretation of existing laws and regulations.  

    5.6.5.        It
is an “Accredited Investor” as such term is defined in Rule 501 of
          Regulation D under the Securities Act of 1933.  

    5.7.        No
solicitation. At no time was any Lender presented with or solicited by           any
leaflet, public promotional meeting, newspaper or magazine article, radio or
          television advertisement or any other form of general advertising or general
          solicitation concerning the Loan or any investment in the Shares. The Lender is
          aware of the Company’s proxy statement in respect of its Special General
          Shareholders Meeting publicly filed by the Company with the SEC, in which the
          Company sought approval for a framework of a private placement of convertible
          debt securities.  

    5.8.        Broker-Dealer.
No Lender is a broker-dealer, nor is it an affiliate of           any broker-dealer.  

    5.9.        Further
Indebtedness. Each Lender acknowledges that no provision of the           Transaction
Documents executed and delivered by the Company restricts, or shall           be
construed to restrict, in any way the ability of the Company to incur
          indebtedness or to issue share capital or other equity securities (or
securities           convertible into equity securities) of the Company or to grant liens
on its           property and assets.  

6

    5.10.        Voting
and/or Investment Control over the Lenders. Each Lender has made           available
to the Company a list of individuals who have or share voting and/or           investment
control over such Lender. Each Lender shall update such list as           reasonably
requested by the Company in order to comply with its public filing           obligations
or requests for such information from any regulatory body.  

    5.11.        Independent
Investment. Each Lender is acting independently with respect           to its
extension of the Loan and its entering into the Transaction Documents.           For the
avoidance of doubt, each Lender’s rights, obligations,           representations and
warranties hereunder stand severally from any other           Lender’s rights and
obligations hereunder.  

    5.12.        Holdings.
Schedule A attached hereto reflects the holdings of the           Company’s
shares by each Lender and its affiliates as of the date hereof,           and as of the
Closing Date.  

    5.13.        Availability
of Exemptions. Each Lender understands that the Conversion           Shares and the
Warrant Shares if issued will be issued in reliance on a           transactional
exemption or exemptions from the registration requirements of           Israeli and U.S.
Federal and state securities laws, and the Company is relying           upon the truth
and accuracy of the representations, warranties, agreements,           acknowledgments
and understandings of the Lenders set forth herein in order to           determine the
applicability of such exemptions and the suitability of each           Lender to acquire
the Shares.  

    5.14.        Disclosure.
The representations and warranties of each Lender contained           in this Section 5
as of the date hereof and as of the Closing Date, do not           contain any untrue
statement of a material fact or omit to state a material fact           required to be
stated herein or necessary to make the statements herein, in           light of the
circumstances under which they are made, not misleading. Each           Lender
understands and confirms that the Company will rely on the foregoing
          representations in effecting the transaction contemplated in the Transaction
          Documents and other transactions in securities of the Company.  

     Section 6.
        Conditions Precedent to Closing and Funding of Loan.  

        The
obligations of each Lender to extend the Loan is subject to the fulfillment at or before
the Closing Date, of the following conditions precedent, any one or more of which may be
waived in whole or in part by such Lender: 

    6.1.        Representations
and Warranties. The representations and warranties of the           Company under
this Agreement shall be true in all material respects as of the           Closing Date,
with the same effect as though made on and as of such date.  

    6.2.        Compliance
with Agreements. The Company shall have performed and complied           with all
agreements or conditions required by this Agreement to be performed and
          complied with by it prior to or as of the Closing Date.  

    6.3.        No
Injunction. No statute, rule, regulation, executive order, decree,           ruling
or injunction shall have been enacted, entered, promulgated or endorsed           by any
court or governmental authority of competent jurisdiction which prohibits           the
consummation of any of the transactions contemplated by this Agreement.  

    6.4.        Registration
Rights Agreement. As of the Closing, the Registration Rights           Agreement in
the form attached hereto as Schedule C (the           “Registration Rights
Agreement”) shall have been executed and           delivered by the Company and each
Lender.  

7

    6.5.        Notices
to SEC and Nasdaq. The Company shall have made all filings or           notices with
the SEC and/or Nasdaq, required to be made prior to the Closing           Date.  

    6.6.        Bank
Approval. The Company has obtained a notice form Bank Leumi of the           exclusion of
the Loan repayment from the Company’s subordination letter.  

     Section 7.
        Conditions Precedent to Obligations of the Company.  

        The
Closing is subject to the fulfillment or waiver by the Company prior to or on the Closing
Date of the conditions set forth in this Section 7. 

    7.1.        Representations
and Warranties. The representations and warranties of           each Lender under
this Agreement shall be true in all material respects as of           the Closing Date,
with the same effect as though made on and as of such date.  

    7.2.        Compliance
with Agreements. Each Lender shall have performed and complied           in all
respects with all agreements or conditions required by this Agreement to           be
performed and complied with by it prior to or as of the Closing Date.  

    7.3.        No
Injunction. No statute, rule, regulation, executive order, decree,           ruling
or injunction shall have been enacted, entered, promulgated or endorsed           by any
court or governmental authority of competent jurisdiction which prohibits           the
consummation of any of the transactions contemplated by this Agreement.  

    7.4.        Delivery
of Loan Amount. Each Lender shall have delivered to the Company           its portion
of the Loan on or prior to the Closing Date.  

    7.5.        Government
Approvals. The Company shall have received all necessary           governmental
approvals with respect to the transactions contemplated hereby.           Each Lender
shall have executed any confirmations required by the Office of           Chief
Scientist, if applicable.  

     Section 8.
       Confidentiality. Any information disclosed to any Lender or its
Advisors, which has not previously been made available to the general public by the
Company or which has not become public knowledge otherwise (except as a result of breach
of Lender hereunder), if any, shall be considered Confidential Information. Each Lender
acknowledges the confidential nature of the Confidential Information it may have
received, and agrees that the Confidential Information is the valuable property of the
Company. Each Lender agrees that it and its Advisors shall not reproduce any of the
Confidential Information without the prior written consent of the Company, nor shall they
use any Confidential Information for any purpose except as permitted by and for the
purpose of the performance of this Agreement, or divulge all or any part of the
Confidential Information to any third party. The confidentiality obligations undertaken
by each Lender hereunder will remain in full force and effect regardless of the execution
and consummation or termination of this Agreement.  

     Section 9.
        Miscellaneous.  

    9.1.        Fees.
Upon the Closing, the Company shall pay the Lenders’          reasonable legal fees
of one counsel to the Lenders.  

    9.2.        Amendments.
This Agreement may be modified, supplemented or amended only           by a written
instrument executed by the Company and the respective Lender solely           with
respect to such Lenders rights and obligations.  

8

    9.3.        Notices.
Any notice that is required or provided to be given under this           Agreement shall
be deemed to have been sufficiently given and received for all           purposes, (i)
when delivered in writing by hand, upon delivery; (ii) if sent via           facsimile or
email, upon transmission and electronic confirmation of receipt           (and if
transmitted and received on a non-business day, on the first Business           Day
following transmission and electronic confirmation of receipt), (iii) three           (3)
Business Days (and ten (10) Business Days for international mail) after           being
sent by certified or registered mail, postage and charges prepaid, return
          receipt requested, or (iv) three (3) Business Days after being sent by
          internationally overnight delivery providing receipt of delivery, to the
          following addresses:  

if to the Company, B.O.S Better
Online Solutions Ltd., 20 Freiman Street, Rishon Lezion, 75101 Israel Attn: Mr. Eyal
Cohen, CFO, facsimile: (972) 3 954-1003, with a copy to Amit, Pollak Matalon & Co.,
Nitzba Tower, 17 Yitzhak Sadeh St., Tel-Aviv 67775 Israel attn: Shlomo Landress, Adv. Fax:
(972) 3 568-9001; or at any other address designated by the Company to the Lenders in
writing; 

if to a Lender, to its address listed
in Schedule A for such Lender or at any other address designated by such Lender to
the Company in writing. 

    9.4.        Survival
of Representations and Warranties. All representations and           warranties
contained herein or in any Transaction Document or in any other           certificate
delivered hereunder or thereunder shall survive after the execution           and
delivery of this Agreement or such certificate or document, as the case may           be,
during the Term and for a period of 6 months thereafter. All covenants and
          agreements in the Transaction Documents shall survive in accordance with their
          terms. This Section shall survive the termination of this Agreement for any
          reason.  

    9.5.        Delays
or Omissions; Waiver. Except as expressly provided herein, no           delay or
omission to exercise any right, power or remedy accruing to any party           under
this Agreement shall impair any such right, power or remedy of such party           nor
shall it be construed to be a waiver of any breach or default, or an
          acquiescence thereto, or of a similar breach or default thereafter occurring;
          nor shall any waiver of any single breach or default be deemed a waiver of any
          other breach or default theretofore or thereafter occurring. Any waiver,
permit,           consent or approval of any kind or character on the part of any party
hereto of           any breach or default under this Agreement, or any waiver on the part
of any           party of any provisions or conditions of this Agreement, must be in
writing and           shall be effective only to the extent specifically set forth in
such writing.  

    9.6.        Other
Remedies. Any and all remedies herein expressly conferred upon a           party
shall be deemed cumulative with, and not exclusive of, any other remedy
          conferred hereby or by law on such party, and the exercise of any one remedy
          shall not preclude the exercise of any other.  

    9.7.        Entire
Agreement. This Agreement and the exhibits and schedules hereto,           constitute
the entire understanding and agreement of the parties hereto with           respect to
the subject matter hereof and thereof and supersede all prior and
          contemporaneous agreements or understandings, inducements or conditions,
express           or implied, written or oral, between the parties with respect hereto
and           thereto.  

9

    9.8.        Headings.
All section headings herein are inserted for convenience only           and shall not
modify or affect the construction or interpretation of any           provision of this
Agreement.  

    9.9.        Severability.
Should any one or more of the provisions of this Agreement           (including its
exhibits and schedules) or of any agreement entered into pursuant           to this
Agreement be determined to be illegal or unenforceable, all other           provisions of
this Agreement and of each other agreement entered into pursuant           to this
Agreement, shall be given effect separately from the provision or           provisions
determined to be illegal or unenforceable and shall not be affected           thereby.
The parties further agree to replace such void or unenforceable           provision of
this Agreement with a valid and enforceable provision, which will           achieve, to
the extent possible, the economic, business and other purposes of           the void or
unenforceable provision.  

    9.10.        Assignment.
This Agreement may not be assigned in whole or in part by any           Lender without
the prior written consent of the Company.  

    9.11.        Governing
Law and Venue. This Agreement shall be construed in accordance           with and
governed by the internal laws of the State of Israel, without regard to
          conflict of laws provisions. Any dispute arising under or in relation to this
          Agreement shall be adjudicated in the competent court of Tel Aviv-Jaffa
district           only, and each of the parties hereby submits irrevocably to the
exclusive           jurisdiction of such court.  

    9.12.        Counterparts.
This Agreement may be executed concurrently in any number           of counterparts, each
of which shall be deemed an original, but all of which           together shall
constitute one and the same instrument.  

    9.13.        Further
Actions. At any time and from time to time, each party agrees,           without
further consideration, to take such actions and to execute and deliver           such
documents as may be reasonably necessary to effectuate the purposes of this
          Agreement.  

IN WITNESS WHEREOF the parties have
signed this Loan Agreement in one or more counterparts as of the date first appearing
above. 

		
		
		
		
		
	B.O.S BETTER ONLINE SOLUTIONS LTD. 	[Lenders] [Duplicate for each Lender] 
	 
	By:___________________________	By:____________________________
	Name:_________________________	Name:__________________________
	Title:__________________________	Title:___________________________

10

Schedule A 

	LENDER'S NAME
AND ADDRESS	ACCOUNT
INFORMATION	LOAN AMOUNT	NO. OF
CONVERSION SHARES	NO. OF
WARRANT
SHARES	PRE-LOAN HOLDINGS	POST-LOAN
HOLDINGS
(ASSUMING
CONVERSION OF
LOAN AND EXERCISE
OF WARRANT)
	Amount	Percent	Amount	Percent
	 	 	$________	 	 	 	 	 	 
	           TOTAL	 	 	 	 	 	 	 	 

1

Schedule B 

FORM OF WARRANT 

	 	
THIS
WARRANT AND THE ORDINARY SHARES ISSUABLE UPON EXERCISE OF THIS WARRANT HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS.
THIS WARRANT AND THE ORDINARY SHARES ISSUABLE UPON EXERCISE OF THIS WARRANT MAY NOT BE
SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE
REGISTRATION STATEMENT AS TO THIS WARRANT UNDER SAID ACT AND ANY APPLICABLE STATE
SECURITIES LAWS OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO B.O.S. BETTER ONLINE
SOLUTIONS LTD. THAT SUCH REGISTRATION IS NOT REQUIRED. 	 

Right to Purchase up to ________ Ordinary Shares of

B.O.S. Better Online
Solutions Ltd.  

(subject to adjustment
as provided herein)  

ORDINARY SHARES
PURCHASE WARRANT  

		
		
		
		
		
	No. _________________	Issue Date: _________ 

     B.O.S.
          BETTER ONLINE SOLUTIONS LTD. a company incorporated under the laws of the State
          of Israel hereby certifies that, for value received, ______________or assigns
          (the “Holder”), is entitled, subject to the terms set forth below, to
          purchase from the Company (as defined herein) from and after the Issue Date of
          this Warrant and at any time or from time to time before 5:00 p.m., New York
          time, through the close of business ___________ (the “Expiration
          Date”), up to _________fully paid and nonassessable Ordinary Shares (as
          hereinafter defined), NIS 4.00 nominal value per share, at the exercise price of
          $0.55 per Ordinary Share (the “Exercise Price”). The number and
          character of such Ordinary Shares and the Exercise Price per share are subject
          to adjustment as provided herein. 

1

        As
used herein the following terms, unless the context otherwise requires, have the following
respective meanings: 

          		    (a)       
               The term “Company” shall include B.O.S. Better Online Solutions Ltd.
               and any corporation which shall succeed, or assume the obligations of B.O.S.
               Better Online Solutions Ltd. hereunder. 

               

          		    (b)       
               The term “Other Securities” refers to any securities of the Company or
               any other person (corporate or otherwise) which the Holder of the Warrant at any
               time shall be entitled to receive, or shall have received, on the exercise of
               the Warrant, in lieu of or in addition to Ordinary Shares, or which at any time
               shall be issuable or shall have been issued in exchange for or in replacement of
               Ordinary Shares or Other Securities pursuant to Section 3 or otherwise. 

               

        Capitalized
terms used herein without definition shall have the meanings ascribed to such terms in
that Loan Agreement dated as of the date hereof by and among the Company and the Lenders
(as defined therein). 

Exercise of Warrant.  

	 	1.1. 	Number
of Shares Issuable upon Exercise. From and after the date hereof
                    through and including the Expiration Date, the Holder shall be
entitled to                     receive, upon exercise of this Warrant in whole or in
part, by delivery of an                     original or fax copy of an exercise notice in
the form attached hereto as Exhibit A (the “Exercise Notice”) and
payment in accordance                     with Section 2.2 below, Ordinary Shares of the
Company (the “Warrant                     Shares”), subject to adjustment
pursuant to Section 4. 

	 	1.2. 	Company
Acknowledgment. The Company will, at the time of the partial
                    exercise of the Warrant, upon the request of the Holder hereof
acknowledge in                     writing its continuing obligation to afford to such
Holder any rights to which                     such Holder shall continue to be entitled
after such partial exercise in                     accordance with the provisions of this
Warrant. If the Holder shall fail to make                     any such request, such
failure shall not affect the continuing obligation of the                     Company to
afford to such Holder any such rights. 

Procedure for Exercise.  

	 	1.3. 	Delivery
of Share Certificates, Etc., on Exercise. The Company agrees                     that
the Warrant Shares purchased upon exercise of this Warrant shall be deemed
                    to be issued to the Holder as the record owner of such shares as of
the close of                     business on the date on which this Warrant shall have
been surrendered and                     payment made for such shares in accordance
herewith. As soon as practicable                     after the exercise of this Warrant
in full or in part, and in any event within                     three (3) business days
thereafter, the Company at its expense (including the                     payment by it
of any applicable issue taxes) will cause to be issued in the name                     of
and delivered to the Holder, or as such Holder (upon payment by such Holder
                    of any applicable transfer taxes) may direct in compliance with
applicable                     securities laws, a certificate or certificates for the
number of duly and                     validly issued, fully paid and nonassessable
Warrant Shares (or Other                     Securities) to which the Holder shall be
entitled on such exercise. 

2

	 	1.4. 	Exercise. 

	 	
Payment
shall be made in cash, by wire transfer to a bank account the details of which shall have
been provided by the Company to the Holder in writing or by certified or official bank
check payable to the order of the Company, of the amount equal to the applicable aggregate
Exercise Price for the number of Ordinary Shares specified in the Exercise Notice (as such
exercise number shall be adjusted to reflect any adjustment in the total number of Warrant
Shares issuable to the Holder per the terms of this Warrant) and the Holder shall
thereupon be entitled to receive the applicable number of duly authorized, validly issued,
fully-paid and non-assessable Warrant Shares (or Other Securities) determined as provided
herein. 

	 	1.5. 	Fractional
Shares. This Warrant may not be exercised for fractional                     shares.
In lieu of fractional shares the Company shall make a cash payment
                    therefor based upon the Exercise Price then in effect. 

Effect of Reorganization, Etc.;
Adjustment of Exercise Price. 

	 	1.6. 	Reorganization,
Consolidation, Merger, Etc. In case at any time or from                     time to
time, the Company shall (a) effect a reorganization, (b) consolidate
                    with or merge into any other person, including the sale of
substantially all of                     the Company’s outstanding share capital to
a corporate third party, in                     consideration for such third party’s
securities, or (c) transfer all or                     substantially all of its
properties or assets to any other person under any plan                     or
arrangement contemplating the dissolution of the Company, then, in each such
                    case, as a condition to the consummation of such a transaction,
proper and                     adequate provision shall be made by the Company whereby
the Holder of this                     Warrant, on the exercise hereof as provided in
Sections 1 and 2 at any time                     after the consummation of such
reorganization, consolidation or merger or the                     effective date of such
dissolution, as the case may be, shall receive, in lieu                     of the
Ordinary Shares issuable on such exercise prior to such consummation or
                    such effective date, the shares and Other Securities and property
(including                     cash) to which such Holder would have been entitled upon
such consummation or in                     connection with such dissolution, as the case
may be, if such Holder had so                     exercised this Warrant, immediately
prior thereto, all subject to further                     adjustment thereafter as
provided in Section 4. 

3

	 	1.7. 	Extraordinary
Events Regarding Ordinary Shares. In the event that the                     Company
shall (a) issue additional Ordinary Shares as a dividend or other
                    distribution on outstanding Ordinary Shares, (b) subdivide its
outstanding                     Ordinary Shares, or (c) combine its outstanding Ordinary
Shares into a smaller                     number of Ordinary Shares, then, in each such
event, the Exercise Price shall,                     simultaneously with the happening of
such event, be adjusted by multiplying the                     then Exercise Price by a
fraction, the numerator of which shall be the number of                     Ordinary
Shares outstanding immediately prior to such event and the denominator
                    of which shall be the number of Ordinary Shares outstanding
immediately after                     such event, and the product so obtained shall
thereafter be the Exercise Price                     then in effect. The Exercise Price,
as so adjusted, shall be readjusted in the                     same manner upon the
happening of any successive event or events described                     herein in this
Section 3.2. The number of Ordinary Shares that the Holder of                     this
Warrant shall thereafter, on the exercise hereof be entitled to receive
                    shall be increased or decreased, as the case may be, to a number
determined by                     multiplying the number of Ordinary Shares that would
otherwise (but for the                     provisions of this Section 3.2) be issuable on
such exercise by a fraction of                     which (a) the numerator is the
Exercise Price that would otherwise (but for the                     provisions of this
Section 3.2) be in effect, and (b) the denominator is the                     Exercise
Price in effect on the date of such exercise. 

	 	1.8. 	Good
Faith. All determinations with respect to adjustments by the Company
                    hereunder shall be made by the Board of Directors in good faith. 

2. 

        Certificate
as to Adjustments. In each case of any adjustment or readjustment in the Ordinary Shares
(or Other Securities) issuable on the exercise of the Warrant, the Company at its expense
will promptly cause its Chief Financial Officer or other appropriate designee to compute
such adjustment or readjustment in accordance with the terms of the Warrant and prepare a
certificate setting forth such adjustment or readjustment and showing in detail the facts
upon which such adjustment or readjustment is based.  

        Reservation
of Shares, Etc., Issuable on Exercise of Warrant. The Company will at all times
reserve and keep available, solely for issuance and delivery on the exercise of the
Warrant, Ordinary Shares (or Other Securities) from time to time issuable on the exercise
of the Warrant. 

        Representations
of the Company. The Company represents that (i) all corporate actions on the part of
the Company, its officers, directors and shareholders necessary for the sale and issuance
of the Warrant Shares pursuant hereto and the performance of the Company’s
obligations hereunder were taken prior to and are effective as of the issue date of this
Warrant; (ii) the Warrant Shares are duly authorized and reserved for issuance by the
Company and, when issued in accordance with the terms hereof, will be validly issued,
fully paid and nonassessable and not subject to any preemptive rights, and (iii) the
execution and delivery of this Warrant are not, and the issuance of the Warrant Shares
upon exercise of this Warrant in accordance with the terms hereof will not be,
inconsistent with the Company’s Articles of Association, do not and will not
contravene any law, governmental rule or regulation, or, to the Company’s knowledge,
any judgment or order applicable to the Company, and, except except as would not have a
Material Adverse Effect, do not and will not conflict with or contravene any provision of,
or constitute a default under, any indenture, mortgage, contract or other instrument of
which the Company is a party or by which it is bound, or require the consent or approval
of, the giving of notice to, the registration with or the taking of any action in respect
of or by any government authority or agency or other person. As used herein,
“Material Adverse Effect” means any material adverse effect on the business,
properties, assets, operations, prospects, results of operations or condition (financial
or otherwise) of the Company and its subsidiaries, taken as a whole. 

4

        Representations
and Warranties by the Holder. The Holder represents and warrants to the Company as
follows: 

	 	2.1. 	Holder
understands that the Warrant is being offered and sold pursuant to an
                    exemption or exemptions from registration requirements of Israeli and
US Federal                     and state securities laws and that the Company is relying
upon the truth and                     accuracy of Holder’s representations
contained in that Loan Agreement of                     even date herewith, including,
without limitation, that the Holder is an                     “Accredited Investor” within
the meaning of Regulation D under the                     Securities Act of 1933. 

	 	2.2. 	Holder
has substantial experience in evaluating and investing in private
                    placement transactions of securities in companies similar to the
Company so that                     it is capable of evaluating the merits and risks of
its investment in the                     Company and has the capacity to protect its own
interests. Holder is able to                     bear the economic risk of this
investment. 

	 	2.3. 	Holder
is acquiring the Warrant and the Ordinary Shares issuable upon exercise
                    of the Warrant for its own account for investment only, and not as a
nominee or                     agent and not with a view towards or for resale in
connection with their                     distribution. 

        Assignment;
Exchange of Warrant. Subject to compliance with applicable securities laws, this
Warrant, and the rights evidenced hereby, may be transferred in whole by any registered
Holder hereof (a “Transferor”) in whole or in part. On the surrender for
exchange of this Warrant, with the Transferor’s endorsement in the form of Exhibit
B attached hereto (the “Transferor Endorsement Form”) and together with
evidence reasonably satisfactory to the Company demonstrating compliance with applicable
securities laws, which shall include, without limitation, a legal opinion from the
Transferor’s counsel that such transfer is exempt from the registration requirements
of applicable securities laws, the Company at its expense (but with payment by the
Transferor of any applicable transfer taxes) will issue and deliver a new Warrant of like
tenor, in the name of the transferee specified in such Transferor Endorsement Form (each a
“Transferee”), calling in the aggregate on the face thereof for the number of
Ordinary Shares called for on the face of the Warrant so surrendered by the Transferor.
Notwithstanding the foregoing, no opinion of counsel or “no-action” letter shall
be necessary for a transfer without consideration by a Holder to any other entity which
controls, is controlled by or is under common control with the Holder. 

        Replacement
of Warrant. On receipt of evidence reasonably satisfactory to the Company of the loss,
theft, destruction or mutilation of this Warrant and, in the case of any such loss, theft
or destruction of this Warrant, on delivery of an indemnity agreement or security
reasonably satisfactory in form and amount to the Company or, in the case of any such
mutilation, on surrender and cancellation of this Warrant, the Company at its expense will
execute and deliver, in lieu thereof, a new Warrant of like tenor. 

5

        Registration
Rights. The Holder of this Warrant has been granted certain registration rights by the
Company. These registration rights are set forth in a Registration Rights Agreement
entered into by the Company and the Holder dated as of even date of this Warrant. 

        Rights
of Shareholders. No Holder shall be entitled, in its capacity as a Warrant holder
only, to vote or receive dividends or be deemed the holder of the Ordinary Shares or any
Other Securities of the Company, which may at any time be issuable upon the exercise of
this Warrant for any purpose, nor shall anything contained herein be construed to confer
upon the Holder, as such, any of the rights of a shareholder of the Company or any right
to vote for the election of directors or upon any other matter submitted to shareholders
at any meeting thereof, or to give or withhold consent to any corporate action (whether
upon any recapitalization, issuance of shares, reclassification of shares, change of
nominal value, consolidation, merger, conveyance, or otherwise) or to receive notice of
meetings, or to receive dividends or subscription rights or otherwise until the Warrant
shall have been exercised and the Ordinary Shares issuable upon the exercise hereof shall
have become deliverable, as provided herein. 

        Transfer
on the Company’s Books. Until this Warrant is transferred on the books of the
Company, the Company may treat the registered holder hereof as the absolute owner hereof
for all purposes, notwithstanding any notice to the contrary. 

        Notices,
Etc. All notices and other communications from the Company to the Holder of this
Warrant shall be deemed to have been sufficiently given and received for all purposes, (i)
when delivered in writing by hand, upon delivery; (ii) if sent via facsimile or email,
upon transmission and electronic confirmation of receipt (and if transmitted and received
on a non-business day, on the first business day following transmission and electronic
confirmation of receipt), (iii) seven (7) business days (and fourteen (14) business days
for international mail) after being sent by certified or registered mail, postage and
charges prepaid, return receipt requested, or (iv) three (3) business days after being
sent by internationally overnight delivery providing receipt of delivery, to the address
as may have been furnished to the Company in writing by such Holder or, until any such
Holder furnishes to the Company an address, then to, and at the address of, the last
Holder of this Warrant who has so furnished an address to the Company. 

        Miscellaneous.
          This Warrant and any term hereof may be changed, waived, discharged or
          terminated only by an instrument in writing signed by the party against which
          enforcement of such change, waiver, discharge or termination is sought. This
          Warrant shall be governed by and construed in accordance with the laws of the
          State of Israel without regard to principles of conflicts of laws. Any dispute
          arising under or in relation to this Agreement shall be adjudicated in the
          competent court of Tel Aviv-Jaffa district only, and each of the parties hereby
          submits irrevocably to the exclusive jurisdiction of such court. In the event
          that any provision of this Warrant is invalid or unenforceable under any
          applicable statute or rule of law, then such provision shall be deemed
          inoperative to the extent that it may conflict therewith and shall be deemed
          modified to conform with such statute or rule of law. Any such provision, which
          may prove invalid or unenforceable under any law shall not affect the validity
          or enforceability of any other provision of this Warrant. The headings in this
          Warrant are for purposes of reference only, and shall not limit or otherwise
          affect any of the terms hereof. The invalidity or unenforceability of any
          provision hereof shall in no way affect the validity or enforceability of any
          other provision.  

6

        IN
WITNESS WHEREOF, this Warrant is executed as of the date first written above. 

		
		
		
		
		
	B.O.S BETTER ONLINE SOLUTIONS LTD.  	[LENDER]  
	 
	By:___________________________	By:____________________________
	Name:_________________________	Name:__________________________
	Title:__________________________	Title:___________________________

7

EXHIBIT A 

FORM OF SUBSCRIPTION 

(To Be Signed Only On Exercise
Of Warrant) 

	To:  	B.O.S.
Better Online Solutions Ltd.

        Attention:     Chief Financial Officer 

        The
undersigned, pursuant to the provisions set forth in the attached Warrant (No.____),
hereby irrevocably elects to purchase (check applicable box): 

			
			
			
			
			
	________	________	Ordinary Shares covered by such Warrant;

o
   The undersigned herewith makes
payment of the full Exercise Price for such shares at the price per share provided for in
such Warrant, which is $___________. Such payment takes the form of (check applicable box
or boxes): 

	 	             o
 	$__________
by wire transfer of lawful money of the United States; and/or

	 	             o
 	$__________
by certified or official bank check payable to the order of the Company

        The
 undersigned  requests  that the  certificate  for such  shares be issued in the name of,
and delivered       to       ______________________________________________       whose
      address       is
______________________________________________________________________. 

        The
undersigned represents and warrants that all offers and sales by the undersigned of the
securities issuable upon exercise of the within Warrant shall be made pursuant to
registration of the Ordinary Shares under the Securities Act of 1933, as amended (the
“Securities Act”) or pursuant to an exemption from registration under the
Securities Act. 

		
		
		
		
		
	Dated: ___________________________	_________________________________________
	 	(Signature must conform to name of Holder as
	 	specified on the face of the Warrant)
	 
	 	Address:____________________________________
	 	                 ____________________________________

A - 1

EXHIBIT B 

FORM OF TRANSFEROR
ENDORSEMENT 

(To Be Signed Only on
Transfer of Warrant) 

For value received, the undersigned
hereby sells, assigns, and transfers unto the person named below under the heading
“Transferee” the right represented by the within Warrant to purchase the number
of Ordinary Shares of B.O.S Better Online Solutions Ltd. into which the within Warrant
relates and appoints each such person attorney-at-fact to transfer its respective right on
the books of B.O.S. Better Online Solutions Ltd. with full power of substitution. 

		
		
		
		
		
	NAME OF TRANSFEREE  	ADDRESS  
	 
	DATED: _____________________________ 	 _______________________________
	 	(SIGNATURE MUST CONFORM TO NAME 
	 	OF HOLDER AS SPECIFIED ON THE FACE 
	 	OF THE WARRANT) 
	 
	 	ADDRESS: _________________________ 
	 
	 	                      ________________________
	 
	ACCEPTED AND AGREED: 
	[TRANSFEREE] 
	 
	By: ______________________________
	Name: ____________________________
	Title: ___________________________

B - 1

Schedule C 

REGISTRATION RIGHTS
AGREEMENT  

        This
Registration Rights Agreement is made and entered into as of _________, 2009 by and among
B.O.S. Better Online Solutions Ltd., an Israeli company (the “Company”),
and the entities listed in Schedule 1, as may be
unilaterally amended from time to time by the Company, to reflect the inclusion of
additional Lenders (collectively, the “Lenders” and each, a
“Lender”). 

WHEREAS, the Company and the
respective Lender have entered into that certain Loan Agreement (the “Loan
Agreement”) dated as of ________, 2009; and 

WHEREAS, pursuant to the Loan
Agreement and in accordance with the terms thereof, the Loan extended by the Lender is
convertible into Ordinary Shares, each with a nominal value of NIS 4.00 per share, of the
Company (“Ordinary Shares”); 

WHEREAS, the Company has also issued
to the Lenders Warrants (the “Warrants”) for the purchase of Ordinary
Shares of the Company, each with a nominal value of NIS 4.00; and 

        WHEREAS,
the parties desire to set forth certain matters regarding ownership of the Company Shares
(as defined below), as more fully set forth herein. 

        NOW,
THEREFORE, the parties hereto agree as follows: 

	1.  	DEFINITIONS. 

	 	
For
purposes of this Agreement, the following terms shall have the meanings set forth below:  

	 	1.1 	“Holders” means
any Lender, transferee or assignee to whom any of the Lenders assigns its rights, in
whole or in part, and any transferee or assignee thereof to whom a transferee or assignee
assigns its rights, in accordance with Section 9. 

	 	1.2 	“ISA” means
the Israel Securities Authority or any similar or successor agency of Israel
administering the Israel Securities Law. 

	 	1.3 	“Israel
Securities Law” means the Israel Securities Law, 5728-1968 (including the
regulations promulgated thereunder), as amended. 

	 	1.4 	"1933
Act" means the U.S. Securities Act of 1933, as amended, and the rules and
regulations thereunder, or any similar successor statute. 

	 	1.5 	"1934
Act" means the U.S. Securities Exchange Act of 1934, as amended, and the rules
and regulations thereunder, or any similar successor statute. 

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

	 	1.7 	“Permitted
Transferee” means with respect to any Holder: (i) a transferee by operation of
law; (ii) a spouse or child of the Holder; (iii) in the case of a transfer by a Holder
that is a limited partnership, any affiliated limited partnership managed by the same
management company or to the partners of the limited partnership; (iv) in the case of a
transfer by a Holder that is a limited liability company, any affiliated limited
liability company managed by the same management company, and the members of such limited
liability company; and (v) an entity Controlling the Holder, under the Control of the
Holder or under common Control with the Holder or any Permitted Transferee set forth in
(i) – (iv) of this definition. 

1

	 	1.8 	“Register”,
“registered”, and “registration” refer to a
registration effected by preparing and filing a registration statement in compliance with
the 1933 Act and the effectiveness of such registration statement in accordance with the
1933 Act or the equivalent actions under the laws of another jurisdiction. 

	 	1.9 	“Registrable
Securities” means any Shares (as defined below) held by the Lender and any other
securities issued by the Company to the Lender in respect of such Shares by means of
exchange, reclassification, dividend, distribution, split-up, combination, subdivision,
recapitalization, merger, spin-off, reorganization, contractual obligation or otherwise,
prior to the date the Registration Statement was filed with the SEC, except that Shares
that can be sold without restriction pursuant to Rule 144 under the 1933 Act shall not be
deemed Registrable Securities. 

	 	1.10 	“Registration
Statement” means a registration statement or registration statements of the
Company covering Registrable Securities filed with the SEC under the 1933 Act on Form
F-3, so as to allow the Holder to freely resell the Registrable Securities on the
exchange on which securities of the Company of the same class or series are then listed. 

	 	1.11 	“SEC” means
the United States Securities and Exchange Commission or any similar or successor agency
of the United States administering the 1933 Act. 

	 	1.12 	"Shares"
means the Ordinary Shares issued to the Lenders upon conversion of the Loan and any
Warrant Shares . 

	 	1.13 	"Warrant
Shares" means Ordinary Shares purchased by the Lenders pursuant to the exercise of the
Warrant. 

	 	1.2 	Capitalized
terms used herein without definition shall have the meanings ascribed to them in the Loan
Agreement. 

	2.  	LISTING
& REGISTRATION OF THE SHARES 

	 	2.1 	The
Company shall prepare and, no later than 12 months following the closing of the Loan
Agreement, file with the SEC a Registration Statement on Form F-3 covering the resale of
all of the then Registrable Securities that are not already registered. The Company shall
use commercially reasonable efforts to have the Registration Statement declared effective
by the SEC as soon as possible after such filing with the SEC. Notwithstanding the above,
each Lender acknowledges that the SEC may mandate a limit on the number of Registrable
Securities that can be included in the Registration Statement and in such case the
Company shall be required to register only such amount of Registrable Securities as shall
not exceed the aforementioned limit, pro-rated amongst the Lenders. 

	 	2.2 	In
the event that Form F-3 shall not be available for the registration of the resale of
Registrable Securities hereunder, the Company shall promptly register the resale of the
Registrable Securities on another appropriate form in accordance with its undertakings
hereunder, to the extent such registration is permitted under the rules and
regulations of the SEC and in compliance with the SEC’s requirements therefore.

2

	 	2.3 	The
Company represents and warrants to the Lenders that the Company is not a party to any
agreement that conflicts in any manner with the Lenders’ rights to cause the Company
to register Registrable Shares pursuant to this Agreement. 

	3.  	RELATED
OBLIGATIONS. 

	 	3.1 	Following
the filing and effectiveness of each Registration Statement with the SEC pursuant to
Section 2.1, the Company shall use commercially reasonable efforts to keep the
Registration Statement effective pursuant to Rule 415 of the 1933 Act at all times until
the earlier of (i) the date as of which all of the Registrable Securities covered by such
Registration Statement may be sold without restriction pursuant to Rule 144(k) under the
1933 Act (ii) the date on which the Holders shall have sold all the Registrable
Securities covered by such Registration Statement; or (iii) the fifth anniversary of the
date hereof (the “Registration Period”). The Company shall ensure that
such Registration Statement (including any amendments or supplements thereto and
prospectuses contained therein) shall not contain any untrue statement of a material fact
or omit to state a material fact required to be stated therein, or necessary to make the
statements therein, in light of the circumstances in which they were made, not
misleading, subject to Section 3.5 below. 

	 	3.2 	The
Company shall prepare and file with the SEC such amendments (including post-effective
amendments) and supplements to the Registration Statement and the prospectus used in
connection with such Registration Statement, as may be necessary to keep such
Registration Statement effective at all times during the Registration Period, and, during
such period, comply with the provisions of the 1933 Act and the Israel Securities Law
with respect to the disposition of all Registrable Securities of the Company covered by
such Registration Statement. In the case of amendments and supplements to a Registration
Statement which are required to be filed pursuant to the Agreement (including pursuant to
this Section 3.2 by reason of the Company filing a report on Form 20-F, Form 6-K or
any analogous report under the 1934 Act), the Company shall have incorporated such report
by reference into the Registration Statement, if applicable, or shall file such
amendments or supplements with the SEC as may be required to maintain the Registration
Statement effective during the Registration Period. 

	 	3.3 	The
Company shall furnish such Holder whose Registrable Securities are included in any
Registration Statement, without charge, (i) a copy of such Registration Statement and any
amendment(s) thereto, including financial statements and schedules, all documents
incorporated therein by reference, all exhibits and each preliminary prospectus, (ii)
upon the effectiveness of any Registration Statement, a copies of the prospectus included
in such Registration Statement and all amendments and supplements thereto and (iii) such
other documents, as such Holder may reasonably request from time to time in order to
facilitate the disposition of the Registrable Securities owned by such Holder. 

3

	 	3.4 	The
Company shall use its commercially reasonable efforts to (i) register and qualify, unless
an exemption from registration and qualification applies, the resale by the Holders of
the Registrable Securities covered by a Registration Statement under such other
securities or “blue sky” laws of all the states of the United States, (ii)
prepare and file in those jurisdictions, such amendments (including post-effective
amendments) and supplements to such registrations and qualifications as may be necessary
to maintain the effectiveness thereof during the Registration Period, (iii) take such
other actions as may be necessary to maintain such registrations and qualifications in
effect at all times during the Registration Period, and (iv) take all other actions
reasonably necessary or advisable to qualify the Registrable Securities for sale in such
jurisdictions; provided, however, that the Company shall not be required in connection
therewith or as a condition thereto to (x) qualify to do business in any jurisdiction
where it would not otherwise be required to qualify but for this Section 3.4, or (y) file
a general consent to service of process in any such jurisdiction. The Company shall
promptly notify each Holder who holds Registrable Securities of the receipt by the
Company of any notification with respect to the suspension of the registration or
qualification of any of the Registrable Securities for sale under the securities or “blue
sky”laws of any jurisdiction in the United States or its receipt of actual notice of
the initiation or threatening of any proceeding for such purpose. 

	 	3.5 	The
Company shall notify each Holder in writing of the happening of any event, (a “Discontinuation
Event”) as promptly as practicable after becoming aware of such event, as a
result of which the prospectus included in a Registration Statement, as then in effect,
includes an untrue statement of a material fact or an omission to state a material fact
required to be stated therein or necessary to make the statements therein, in light of
the circumstances under which they were made, not misleading. The Company shall use its
commercially reasonable efforts to minimize the period of time during which a
Registration Statement includes an untrue statement of a material fact or omission to
state a material fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not misleading. The
Company shall promptly notify each Holder in writing (i) when a prospectus or any
prospectus supplement or post-effective amendment has been filed so that the Registration
Statement does not include an untrue statement of a material fact or an omission to state
a material fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not misleading, and
when a Registration Statement or any post-effective amendment has become effective, (ii)
of any request by the SEC for amendments or supplements to a Registration Statement or
related prospectus or related information, and (iii) of the Company’s reasonable
determination that a post-effective amendment to a Registration Statement would be
appropriate. 

	 	3.6 	The
Company shall use its commercially reasonable efforts to prevent the issuance of any stop
order or other suspension of effectiveness of a Registration Statement, or the suspension
of the qualification of any of the Registrable Securities for sale in any jurisdiction
(each, a “Suspension Event”) and, if such an order or suspension is
issued, to promptly obtain the withdrawal of such order or suspension and to notify each
Holder who holds Registrable Securities being sold of the issuance of such order and the
resolution thereof or its receipt of actual notice of the initiation or threat of any
proceeding for such purpose. 

4

	 	3.7 	The
Company shall use its commercially reasonable efforts to cause all the Registrable
Securities covered by a Registration Statement to be listed on each securities exchange
on which securities of the same class or series issued by the Company are then listed. 

	 	3.8 	The
Company shall cooperate with the Holders who hold Registrable Securities being offered
and, to the extent applicable, facilitate the timely preparation and delivery of
certificates (not bearing any restrictive legend) representing the Registrable Securities
to be offered pursuant to the effective Registration Statement and enable such
certificates to be in such denominations or amounts, as the case may be, as the Holders
may reasonably request and registered in such names as the Holders may request. 

	 	3.9 	The
Company shall provide a transfer agent and registrar of all Registrable Securities and a
CUSIP number not later than the effective date of the applicable Registration Statement. 

	 	3.10 	If
requested by a Holder, the Company shall, to the extent necessary for compliance with the
Securities Act of 1933: (i) as soon as practicable incorporate in a prospectus supplement
or post-effective amendment such information as a Holder requests to be included therein,
information with respect to the number of Registrable Securities being offered or sold,
the purchase price being paid therefor and any other terms of the offering of the
Registrable Securities to be sold in such offering; (ii) as soon as practicable make all
required filings of such prospectus supplement or post-effective amendment after being
notified of the matters to be incorporated in such prospectus supplement or
post-effective amendment; and (iii) as soon as practicable, supplement or make amendments
to any Registration Statement if reasonably requested by a Holder of such Registrable
Securities. 

	 	3.11 	The
Company shall comply with all applicable securities laws and rules and regulations of the
SEC and the ISA. 

	4.  	OBLIGATIONS
OF THE HOLDERS. 

	 	
Each
Holder agrees that, upon receipt of any notice from the Company of the happening of a
Discontinuation Event (as defined in Section 3.5) or a Suspension Event (as defined in
Section 3.6), such Holder will immediately discontinue disposition of Registrable
Securities pursuant to any Registration Statement(s) covering such Registrable Securities
until such Holder’s receipt of the copies of the supplemented or amended prospectus
contemplated by Section 3.5 or receipt of notice that no supplement or amendment is
required or that the Suspension Event was removed. 

	5.  	EXPENSES
OF REGISTRATION. 

	 	
All
expenses, other than underwriting discounts and commissions, incurred in connection with
registrations, filings or qualifications pursuant to Sections 2 and 3, including, without
limitation, all registration, listing and qualifications fees, printers and accounting
fees, fees and disbursements of one counsel to the Lenders and counsel to the Company
shall be paid by the Company. 

5

	6.  	INDEMNIFICATION. 

	 	
In
the event any Registrable Securities are included in a Registration Statement under this
Agreement: 

	 	6.1 	To
the fullest extent permitted by law, the Company will, and hereby does, indemnify, hold
harmless and defend each Holder, the directors, officers, partners, employees, agents,
representatives of, and each Person, if any, who controls any Holder within the meaning
of the 1933 Act or 1934 Act (each, an “Indemnified Person”), against any
losses, claims, damages, liabilities, judgments, fines, penalties, charges, costs,
reasonable attorneys’ fees, amounts paid in settlement or expenses, joint or
several, (collectively, “Claims”) incurred in defending any action,
claim, suit, inquiry, proceeding, investigation by or before any court or governmental,
administrative or other regulatory agency, body or the SEC or the ISA, whether pending or
threatened, whether or not a Person to be indemnified is or may be a party thereto (“Indemnified
Damages”), to which any of them may become subject insofar as such Claims
(or actions or proceedings, whether commenced or threatened, in respect thereof) arise
out of or are based upon: (i) any untrue statement or alleged untrue statement of a
material fact in a Registration Statement, preliminary prospectus, final prospectus or
“free writing prospectus” (as such term is defined in Rule 405 under the 1933
Act) or any post-effective amendment thereto or in any filing made in connection with the
qualification of the offering under the securities or other “blue sky” laws of
any jurisdiction in which Registrable Securities are offered (“Blue Sky Filing”),
or the omission or alleged omission to state a material fact required to be stated
therein or necessary to make the statements therein not misleading, or (ii) any violation
by the Company of the 1933 Act, the 1934 Act, the Israel Securities Law or other federal
or state or Israeli securities law applicable to the Company and relating to any action
or inaction required of the Company in connection with such registration (“Violations”).
Subject to Section 6.3, the Company shall reimburse the Indemnified Persons promptly as
such expenses are incurred and are due and payable, for any legal fees or other
reasonable expenses incurred by them in connection with investigating or defending any
such Claim. Notwithstanding anything to the contrary contained herein, the
indemnification agreement contained in this Section 6.1: shall not apply: (i) to a Claim
by an Indemnified Person arising out of or based upon a Violation which occurs in
reliance upon and in conformity with information furnished in writing to the Company by
such Indemnified Person expressly for inclusion in any such Registration Statement,
preliminary prospectus, final prospectus or free writing prospectus or any such amendment
thereof or supplement thereto; (ii) to amounts paid in settlement of any Claim if such
settlement is effected without the prior written consent of the Company, which consent
shall not be unreasonably withheld; and (iii) to the use of the Registration Statement or
the related Prospectus following a Discontinuation Event or a Suspension Event, provided
the Indemnified Person received prior notice of such event; or (iv) if the Indemnified
Person fails to deliver a prospectus, as then amended or supplemented, provided that the
Company shall have delivered to the Indemnified Person such prospectus. Such indemnity
shall remain in full force and effect regardless of any investigation made by or on
behalf of the Indemnified Person and shall survive the transfer of the Registrable
Securities by the Holders pursuant to Section 9.  

6

	 	6.2 	In
connection with any Registration Statement in which a Holder is participating, each such
Holder agrees, severally and not jointly, to indemnify, hold harmless and defend, to the
same extent and in the same manner as is set forth in Section 6.1, the Company, each of
its directors, each of its officers, employees, agents. Representatives and each Person,
if any, who controls the Company within the meaning of the 1933 Act or the 1934 Act (each
an “Indemnified Party”), against any Claim or Indemnified Damages to
which any of them may become subject, under the 1933 Act, the 1934 Act or otherwise,
insofar as such Claim or Indemnified Damages arise out of or are based upon any
Violation, in each case to the extent, and only to the extent, that such Violation occurs
in reliance upon and in conformity with written information furnished to the Company by
such Holder expressly for inclusion in Registration Statement, preliminary prospectus,
final prospectus or free writing prospectus and, subject to Section 6.3, such Holder will
reimburse any legal or other expenses reasonably incurred by an Indemnified Party in
connection with investigating or defending any such Claim; provided, however, that the
indemnity agreement contained in this Section 6.2 and the agreement with respect to
contribution contained in Section 7 shall not apply to amounts paid in settlement of any
Claim if such settlement is effected without the prior written consent of such Holder,
which shall not be unreasonably withheld; provided, further, however, that the Holder
shall be liable under this Section 6 for only that amount of a Claim or Indemnified
Damages as does not exceed the higher of: (i) the net proceeds to such Holder as a result
of the sale of Registrable Securities pursuant to such Registration Statement and (ii)
the aggregate Conversion Price (as defined in the Loan Agreement) and the aggregate
Exercise Price (as defined in the Warrant) paid by the applicable Holder for the Ordinary
Shares and the Warrant Shares. Such indemnity shall remain in full force and effect
regardless of any investigation made by or on behalf of such Indemnified Party and shall
survive the transfer of the Registrable Securities by the Holders pursuant to Section 9. 

	 	6.3 	Promptly
after receipt by an Indemnified Person or Indemnified Party under this Section 6 of
notice of the commencement of any action or proceeding (including any governmental action
or proceeding) involving a Claim, such Indemnified Person or Indemnified Party shall
deliver to the indemnifying party a written notice of the commencement thereof, and the
indemnifying party shall have the right to participate in, and, to the extent the
indemnifying party so desires, jointly with any other indemnifying party similarly
noticed, to assume control of the defense thereof with counsel mutually satisfactory to
the indemnifying party and the Indemnified Person or the Indemnified Party, as the case
may be; provided, however, that an Indemnified Person or Indemnified Party shall have the
right to retain its own counsel with the fees and expenses of not more than one counsel
for such Indemnified Person or Indemnified Party to be paid by the indemnifying party, if
the representation by such counsel of the Indemnified Person or Indemnified Party
together with the indemnifying party would be inappropriate due to actual or potential
differing interests between such Indemnified Person or Indemnified Party and any other
party represented by such counsel in such proceeding. In the case of an Indemnified
Person, legal counsel referred to in the immediately preceding sentence shall be selected
by the Holders holding a majority in interest of the Registrable Securities included in
the Registration Statement to which the Claim relates. The Indemnified Party or
Indemnified Person shall cooperate with the indemnifying party in connection with any
negotiation or defense of any such action or Claim by the indemnifying party and shall
furnish to the indemnifying party all information reasonably available to the Indemnified
Party or Indemnified Person which relates to such action or Claim. The failure to deliver
written notice to the indemnifying party within a reasonable time of the commencement of
any such action shall not relieve such indemnifying party of any liability to the
Indemnified Person or Indemnified Party under this Section 6, except to the extent that
the indemnifying party is prejudiced in its ability to defend such action, but the
omission to so notify the indemnifying party will not relieve such indemnifying party of
any liability that it may have to any Indemnified Person or Indemnified Party otherwise
than under this Section 6.3, including pursuant to Section 6.5. 

7

	 	6.4 	The
indemnification required by this Section 6 shall be made by periodic payments of the
amount thereof during the course of the investigation or defense, as and when bills are
received or Indemnified Damages are incurred. 

	 	6.5 	The
indemnity agreements contained herein shall be in addition to (i) any cause of action or
similar right of the Indemnified Party or Indemnified Person against the indemnifying
party or others, and (ii) any liabilities the indemnifying party may be subject to
pursuant to the law. 

	7.  	CONTRIBUTION. 

	 	
To
the extent any indemnification by an indemnifying party is prohibited or limited by law or
insufficient to hold an Indemnified Person or an Indemnified Party, as the case may be,
harmless, then the indemnifying party, in lieu of indemnifying such Indemnified Person or
Indemnified Party hereunder, shall contribute to the amount paid or payable by such
Indemnified Person or Indemnified Party as a result of such Claims and Indemnified Damages
(each as defined in Section 6.1 above) in such proportion as is appropriate to reflect the
relative fault of the indemnifying party on the one hand and of the Indemnified Person or
Indemnified Party, as the case may be, on the other hand in connection with the statements
or omissions that resulted in such loss, liability, claim, damage, or expense as well as
any other relevant equitable considerations. The relative fault of the indemnifying party
and of the Indemnified Person or Indemnified Party, as the case may be, shall be
determined by reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or the omission to state a material fact relates to
information supplied by the indemnifying party or by the Indemnified Person or Indemnified
Party, as the case may be, and the parties’ relative intent, knowledge, access to
information, and opportunity to correct or prevent such statement or omission. 

8

	 	
Notwithstanding
the foregoing, (i) no Person involved in the sale of Registrable Securities, which Person
is guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the 1933
Act) in connection with such sale, shall be entitled to contribution from any Person
involved in such sale of Registrable Securities who was not guilty of fraudulent
misrepresentation; and (ii) contribution by any seller of Registrable Securities shall be
limited in amount to the net amount of proceeds received by such seller from the sale of
such Registrable Securities pursuant to such Registration Statement. 

	8.  	REPORTS
UNDER THE 1934 ACT. 

	 	
With
a view to making available to the Holders the benefits of Rule 144 promulgated under the
1933 Act or any other similar rule or regulation of the SEC that may at any time permit
the Holders to sell securities of the Company to the public without registration (“Rule
144”), the Company agrees to:  

	 	8.1 	make
and keep public  information  available,  as those terms are  understood and defined in
Rule                   144;

	 	8.2 	file
with the SEC in a timely manner all reports and other documents required by the Company
under the 1993 Act and the 1934 Act so long as the Company remains subject to such
requirements and the filing of such reports and other documents is required for the
applicable provisions of Rule 144; and 

	 	8.3 	furnish
to each Holder so long as such Holder owns Registrable Securities, promptly upon request,
(i) a written statement by the Company that it has complied with the reporting
requirements of Rule 144, the 1933 Act and the 1934 Act, (ii) a copy of the most recent
annual or quarterly report of the Company and such other reports and documents so filed
by the Company, and (iii) such other information as may be reasonably requested to permit
the Holders to sell such securities pursuant to any rule or regulation of the SEC
allowing the Holder to sell any securities without registration. 

	9.  	ASSIGNMENT
OF REGISTRATION RIGHTS. 

	 	
Subject
to the prior approval of the Company, at any time prior to the time the Registration
Statement was filed with the SEC, the rights under this Agreement shall be assignable by
each Lender to any transferee of all or any portion of such Lender’s respective
portion of the Loan together with its Registrable Securities or the Warrant if: (i) the
Lender agrees in writing with the transferee or assignee to assign such rights, and a
copy of such agreement is furnished to the Company within a reasonable time after such
assignment; (ii) the Company is, within a reasonable time after such transfer or
assignment, furnished with written notice of (a) the name and address of such transferee
or assignee, and (b) the securities with respect to which such registration rights are
being transferred or assigned; (iii) immediately following such transfer or assignment
the further disposition of such securities by the transferee or assignee is restricted
under the 1933 Act and applicable state securities laws; (iv) at or before the time the
Company receives the written notice contemplated by clause (ii) of this sentence the
transferee or assignee agrees in writing with the Company to be bound by all of the
provisions contained herein; and (v) such transfer shall have been made in accordance
with the applicable requirements of the Loan Agreement and applicable securities laws.  

9

	 	
Notwithstanding
the above, any Holder may assign its right to cause the Company to register Shares
pursuant to this Agreement to (i) a Permitted Transferee of all or any part of its
Shares, or (ii) an acquirer of no less than twenty percent (20%) of the Holder’s
Shares if: (a) the transferor shall, within 14 (fourteen) days after such transfer,
furnish the Company with written notice of the name and address of such transferee, the
securities with respect to which such registration rights are being assigned, and the
transferee’s written agreement to be bound by this Agreement; (b) immediately
following such transfer or assignment the further disposition of such securities by the
transferee or assignee is restricted under the 1933 Act and applicable state securities
laws; and (c) such transfer shall have been made in accordance with the applicable
securities laws.  

	10.  	MISCELLANEOUS 

	 	10.1 	Amendments;
Waivers. This Agreement may not be amended, changed, supplemented, waived or
otherwise modified or terminated, except upon the execution and
delivery of a written agreement executed by the Company and the applicable
Lender(s). 

	 	10.2 	Entire
Agreement. This Agreement constitutes the entire agreement between the parties hereto
pertaining to its subject matter, and supersedes and replaces all prior agreements and
understandings of the parties in connection with such subject matter. 

	 	10.3 	Notices.
All notices and other communications required or permitted hereunder to be given to a
party to this Agreement shall be in writing and shall be faxed or mailed by registered or
certified mail, postage prepaid, or otherwise delivered by hand or by messenger in
accordance with the provisions of the Loan Agreement. 

	 	10.4 	Governing
Law; Jurisdiction. This Agreement shall be governed by and construed according to the
internal laws of the State of Israel without regard to the provisions relating to
conflicts of law. Any dispute arising under or in relation to this Agreement shall be
resolved exclusively by the competent courts of Tel-Aviv Jaffa district, and the parties
hereto irrevocably submit to the exclusive jurisdiction of such court for such purposes. 

	 	10.5 	Successors
and Assigns. Except as otherwise expressly limited herein, the provisions of this
Agreement shall inure to the benefit of, and shall be binding upon, the successors and
permitted assigns of the parties hereto. This Agreement may not be assigned by any party
without the prior written consent of the other party hereto. 

	 	10.6 	Severability.
If any provision of this Agreement is held by a court of competent jurisdiction to be
unenforceable under applicable law, then such provision shall be excluded from this
Agreement and the remainder of this Agreement shall be interpreted as if such provision
were so excluded and shall be enforceable in accordance with its terms; provided,
however, that in such event this Agreement shall be interpreted so as to give effect, to
the greatest extent consistent with and permitted by applicable law, to the meaning and
intention of the excluded provision as determined by such court of competent
jurisdiction. 

	 	10.7 	No
Waiver. The failure of any party hereto to exercise any right, power or remedy provided
under this Agreement or otherwise available in respect hereof at law or in equity, or to
insist upon compliance by any other party hereto with its obligations hereunder, and any
custom or practice of the parties at variance with the terms hereof, shall not constitute
a waiver by such party of its right to exercise any such or other right, power or remedy
or to demand such compliance. 

10

	 	10.8 	Headings.
The section and paragraph headings in this Agreement are for convenience of reference
only and are not intended to be a part of this Agreement or to affect the meaning or
interpretation of this Agreement. 

	 	10.9 	Counterparts.
This Agreement may be executed in one or more counterparts (including facsimile
counterparts), all of which taken together shall constitute one agreement. 

	 	10.10 	Equitable
Relief. The parties hereto agree that legal remedies may be inadequate to enforce the
provisions of this Agreement and that equitable relief, including specific performance
and injunctive relief, may be used to enforce the provisions of this Agreement. 

IN WITNESS WHEREOF, the parties
hereto have executed this Registration Rights Agreement as of the date first set forth
above. 

B.O.S. Better Online Solutions Ltd. .

By: ___________________________

Name: _________________________

Title: _________________________

[LENDER]

By:____________________________

Name: ______________________

Title: _______________________

______________________ .

By:____________________________

Name: ______________________

Title: _______________________ 

11

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