SC 13D/A

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 13D/A

(Rule 13d-101)

INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT TO § 240.13d-1(a) AND AMENDMENTS THERETO FILED PURSUANT TO § 240.13d-2(a)

Under the Securities Exchange Act of 1934
(Amendment No. 1)*

B.O.S. BETTER ONLINE SOLUTIONS LTD.

(Name of Issuer)

Ordinary Shares, Par Value NIS 20.00 per share

(Title of Class of Securities)

M20115131

(CUSIP Number)

Clarence V. Wesley

and Luis Gutierrez Roy

Telegraph Hill Capital Fund I, LLC

582 Market Street, Suite 1700

San Francisco, California 94104

Tel: (415) 601-7775

(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)

January 6, 2012

(Date of Event Which Requires Filing of this Statement)

If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of §§ 240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box o.

Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See § 240.13d-7 for other parties to whom copies are to be sent.

* The remainder of this cover page shall be filled out for a reporting person's initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page.

The information required on the remainder of this cover page shall not be deemed to be "filed" for the purpose of Section 18 of the Securities Exchange Act of 1934 ("Act") or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).

CUSIP No.  M20115131						13D
	1.	Name of Reporting Persons Telegraph Hill Capital Fund I, LLC
	2.	Check the Appropriate Box if a Member of a Group (See Instructions)
		(a)			o
		(b)			o
	3.	SEC Use Only
	4.	Source of Funds (See Instructions) OO
	5.	Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e):  o
	6.	Citizenship or Place of Organization: Delaware
Number of Shares Beneficially Owned by Each Reporting Person With			7.	Sole Voting Power 0
			8.	Shared Voting Power 333,301*
			9.	Sole Dispositive Power 0
			10.	Shared Dispositive Power 333,301*
	11.	Aggregate Amount Beneficially Owned by Each Reporting Person 333,301*
	12.	Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions)o
	13.	Percent of Class Represented by Amount in Row (11) 7.1% of Ordinary Shares
	14.	Type of Reporting Person (See Instructions) OO

*Consists of (i) 257,362 Ordinary Shares, (ii) 61,539 Warrant Shares and (iii) 14,400 Option Shares.  See Items 3 and 4.

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CUSIP No.  M20115131						13D
	1.	Name of Reporting Persons Telegraph Hill Capital, LLC
	2.	Check the Appropriate Box if a Member of a Group (See Instructions)
		(a)			o
		(b)			o
	3.	SEC Use Only
	4.	Source of Funds (See Instructions) OO
	5.	Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e):  o
	6.	Citizenship or Place of Organization: Delaware
Number of Shares Beneficially Owned by Each Reporting Person With			7.	Sole Voting Power 0
			8.	Shared Voting Power 333,301*  **
			9.	Sole Dispositive Power 0
			10.	Shared Dispositive Power 333,301*  **
	11.	Aggregate Amount Beneficially Owned by Each Reporting Person 333,301*
	12.	Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions)o
	13.	Percent of Class Represented by Amount in Row (11) 7.1% of Ordinary Shares
	14.	Type of Reporting Person (See Instructions) OO

*Consists of (i) 257,362 Ordinary Shares, (ii) 61,539 Warrant Shares and (iii) 14,400 Option Shares.  See Items 3 and 4.

**Pursuant to Rule 13d-4, this Reporting Person disclaims beneficial ownership of the securities reflected herein except to the extent of the Reporting Person’s pecuniary interest therein and declares that this Amendment No. 1 to Schedule 13D shall not be construed as an admission that such Reporting Person is the beneficial owner of any securities covered hereby.

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CUSIP No.  M20115131						13D
	1.	Name of Reporting Persons Telegraph Hill Group, LLC
	2.	Check the Appropriate Box if a Member of a Group (See Instructions)
		(a)			o
		(b)			o
	3.	SEC Use Only
	4.	Source of Funds (See Instructions) OO
	5.	Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e):  o
	6.	Citizenship or Place of Organization: Delaware
Number of Shares Beneficially Owned by Each Reporting Person With			7.	Sole Voting Power 0
			8.	Shared Voting Power 333,301*  **
			9.	Sole Dispositive Power 0
			10.	Shared Dispositive Power 333,301*  **
	11.	Aggregate Amount Beneficially Owned by Each Reporting Person 333,301*
	12.	Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions)o
	13.	Percent of Class Represented by Amount in Row (11) 7.1% of Ordinary Shares
	14.	Type of Reporting Person (See Instructions) OO

*Consists of (i) 257,362 Ordinary Shares, (ii) 61,539 Warrant Shares and (iii) 14,400 Option Shares.  See Items 3 and 4.

**Pursuant to Rule 13d-4, this Reporting Person disclaims beneficial ownership of the securities reflected herein except to the extent of the Reporting Person’s pecuniary interest therein and declares that this Amendment No. 1 to Schedule 13D shall not be construed as an admission that such Reporting Person is the beneficial owner of any securities covered hereby.

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CUSIP No.  M20115131						13D
	1.	Name of Reporting Persons Clarence V. Wesley
	2.	Check the Appropriate Box if a Member of a Group (See Instructions)
		(a)			o
		(b)			o
	3.	SEC Use Only
	4.	Source of Funds (See Instructions) OO
	5.	Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e):  o
	6.	Citizenship or Place of Organization: United States
Number of Shares Beneficially Owned by Each Reporting Person With			7.	Sole Voting Power 0
			8.	Shared Voting Power 333,301*  **
			9.	Sole Dispositive Power 0
			10.	Shared Dispositive Power 333,301*  **
	11.	Aggregate Amount Beneficially Owned by Each Reporting Person 333,301*
	12.	Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions)o
	13.	Percent of Class Represented by Amount in Row (11) 7.1% of Ordinary Shares
	14.	Type of Reporting Person (See Instructions) IN

*Consists of (i) 257,362 Ordinary Shares, (ii) 61,539 Warrant Shares and (iii) 14,400 Option Shares.  See Items 3 and 4.

**Pursuant to Rule 13d-4, this Reporting Person disclaims beneficial ownership of the securities reflected herein except to the extent of the Reporting Person’s pecuniary interest therein and declares that this Amendment No. 1 to Schedule 13D shall not be construed as an admission that such Reporting Person is the beneficial owner of any securities covered hereby.

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CUSIP No.  M20115131						13D
	1.	Name of Reporting Persons Luis Gutierrez Roy
	2.	Check the Appropriate Box if a Member of a Group (See Instructions)
		(a)			o
		(b)			o
	3.	SEC Use Only
	4.	Source of Funds (See Instructions) OO
	5.	Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e):  o
	6.	Citizenship or Place of Organization: Spain
Number of Shares Beneficially Owned by Each Reporting Person With			7.	Sole Voting Power 0
			8.	Shared Voting Power 333,301*  **
			9.	Sole Dispositive Power 0
			10.	Shared Dispositive Power 333,301*  **
	11.	Aggregate Amount Beneficially Owned by Each Reporting Person 333,301*
	12.	Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions)o
	13.	Percent of Class Represented by Amount in Row (11) 7.1% of Ordinary Shares
	14.	Type of Reporting Person (See Instructions) IN

*Consists of (i) 257,362 Ordinary Shares, (ii) 61,539 Warrant Shares and (iii) 14,400 Option Shares.  See Items 3 and 4.

**Pursuant to Rule 13d-4, this Reporting Person disclaims beneficial ownership of the securities reflected herein except to the extent of the Reporting Person’s pecuniary interest therein and declares that this Amendment No. 1 to Schedule 13D shall not be construed as an admission that such Reporting Person is the beneficial owner of any securities covered hereby.

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Schedule 13D

This Amendment No. 1 to Schedule 13D (this “Amendment No. 1”) amends certain information with respect to ownership of the ordinary shares, par value 20.00 NIS (New Israeli Shekels) (the “Ordinary Shares”), of B.O.S. Better Online Solutions Ltd., an Israeli corporation (the “Company”), set forth in the Schedule 13D filed by Telegraph Hill Capital Fund I, LLC, a Delaware limited liability company (“THCapFund I LLC”), Telegraph Hill Capital, LLC, a Delaware limited liability company (“THCap LLC”), Telegraph Hill Group, LLC, a Delaware limited liability company (“THG LLC”), Clarence V. Wesley and Luis Gutierrez Roy (the foregoing entities and persons collectively, the “Reporting Persons”).

The Schedule 13D associated with the matters reported herein was initially filed on October 14, 2010 (the “Initial 13D”).  Except as set forth in this Amendment No. 1 (or where otherwise inapplicable), all information included in the Initial 13D is incorporated herein by reference.

Item 1.Security and Issuer

This Amendment No. 1 relates to the Ordinary Shares of the Company.  The address of the Company’s principal executive offices is 20 Freiman St., Rishon Lezion, 75101, Israel.

Item 2.Identity and Background

(a)This Amendment No. 1 is being filed by the Reporting Persons pursuant to their agreement to the joint filing of this Amendment No. 1, filed as Exhibit 4 to the Initial 13D (the “Joint Filing Agreement”).

The principal business of THCapFund I LLC is to make venture capital and private equity investments primarily in the mobile, wireless, and media space.  THCap LLC serves as managing member to THCapFund I LLC and THG LLC is the manager of THCap LLC.

Messrs. Wesley and Roy are managing directors of THG LLC and THCap LLC, and may be deemed to have shared voting and dispositive power with respect to the Ordinary Shares beneficially owned by THCapFund I LLC.

Pursuant to Rule 13d-4, each of the Reporting Persons, other than THCapFund I LLC, expressly disclaim beneficial ownership of the securities reflected herein except to the extent of such Reporting Person’s pecuniary interest therein and declares that this Amendment No. 1 shall not be construed as an admission that such Reporting Person is the beneficial owner of any securities covered hereby.

(b)The business address of each of the Reporting Persons is 582 Market Street, Suite 1700, San Francisco, California 94104.

(c)Mr. Wesley is a managing director of THG LLC and THCap LLC.  Mr. Roy is a managing director of THG LLC and THCap LLC and a director of the Company.

(d)None of the Reporting Persons has been convicted in a criminal proceeding during the last five year period prior to the date hereof.

(e)None of the Reporting Persons has been party to any civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of such proceeding was or is subject to a judgment, decree, or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws, or finding any violation with respect to such laws during the last five year period prior to the date hereof.

(f)Each of the Reporting Persons, other than Messrs. Wesley and Roy, is organized under the laws of Delaware.  Mr. Wesley is a citizen of the United States and Mr. Roy is a citizen of Spain.

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Item 3.Source and Amount of Funds or Other Consideration

THCapFund I LLC purchased the 96,362 Ordinary Shares pursuant to a share purchase agreement entered into by THCapFund I LLC and the Company on October 4, 2010 (the “Purchase Agreement”).  The aggregate purchase price for the Ordinary Shares was $300,000, of which the funding for the purchase was obtained by THCapFund I LLC from the contributed capital of its members.

THCapFund I LLC purchased secured notes (the “Notes”) that were convertible into Ordinary Shares at the conversion price per Ordinary Share of $3.25, pursuant to a loan agreement entered into by THCapFund I LLC and the Company in July 2009 (the “Loan Agreement”).  In connection with the Loan Agreement, the Company also granted THCapFund I LLC warrants (the “Warrants”) to purchase 61,539 Ordinary Shares (the “Warrant Shares”).  The aggregate purchase price for the Notes and Warrants was $200,000, of which the funding for the purchase was obtained by THCapFund I LLC from the contributed capital of its members.

On September 1, 2009, THG LLC entered into a consulting agreement with the Company (as amended, the “Consulting Agreement”), pursuant to which the Company provided THCapFund I LLC options (the “Options”) to purchase 14,400 Ordinary Shares (the “Option Shares”).

In November 2011, THCapFund I LLC and the Company entered into an agreement pursuant to which THCapFund I LLC agreed to convert the Notes prior to the maturity date in exchange for a reduced conversion price per Ordinary Share of $1.50 and an extension of the exercise period for the Warrants by two years, to July 22, 2014.  As of January 6, 2012, pursuant to such agreement, the principal and accrued interest on all Notes then held by THCapFund I LLC converted into 161,000 Ordinary Shares.

Item 4.Purpose of Transaction

THCapFund I LLC and the other Reporting Persons acquired the Ordinary Shares, Warrant Shares and Option Shares for investment purposes.

Pursuant to the Purchase Agreement, effective October 4, 2010, the Company has appointed Mr. Roy to the Board of Directors of the Company (the “Board”).

In July 2009, THCapFund I LLC purchased the Notes, which, pursuant to the Loan Agreement, were convertible at any time prior to July 2012 at the sole option of THCapFund I LLC into Ordinary Shares at the conversion price per Ordinary Share of $3.25.  As of the same date, the Company also issued THCapFund I LLC 61,539 Warrant Shares, which were exercisable for a period of 18 months commencing in January 2011.  The Warrant Shares are exercisable, in whole or in part, at a price per Ordinary Share of $2.75.

Beginning September 1, 2009, THG LLC began providing certain consulting services to the Company related to the identification of potential investors, financing and partners for the Company, each as set forth in greater detail in the Consulting Agreement.  In exchange, the Company agreed to pay THG LLC 5% of certain amounts actually received by the Company from those parties identified by THG LLC and issued THCapFund I LLC 14,400 Option Shares, which vest and become exercisable upon the lapse of 18 months from September 1, 2009.  Each Option is exercisable at a price per Ordinary Share of $2.75 and shall expire and shall no longer be exercisable upon the lapse of 18 months after the date of vesting.

In November 2011, THCapFund I LLC and the Company entered into an agreement pursuant to which THCapFund I LLC agreed to convert the Notes prior to the maturity date in exchange for a reduced conversion price per Ordinary Share of $1.50 and an extension of the exercise period for the Warrants by two years, to July 22, 2014.  As of January 6, 2012, pursuant to such agreement, the principal and accrued interest on all Notes then held by THCapFund I LLC converted into 161,000 Ordinary Shares.

The summary of the Purchase Agreement, the Loan Agreement, the Warrants and the Agreement to amend the Notes and Warrants contained in this Amendment No. 1 does not purport to be complete and is qualified in its entirety by reference to such agreements filed herewith as Exhibits 1-4 and incorporated herein by reference.

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Except as disclosed in Items 2, 6 and this Item 4, none of the Reporting Persons has any current plans or proposals which relate to or would result in any of the events described in clauses (a) through (j) of the instructions to Item 4 of Schedule 13D. The Reporting Persons, however, will take such actions with respect to the Reporting Persons’ investments in the Company as deemed appropriate in light of existing circumstances from time to time and reserve the right to acquire or dispose of securities of the Company, to enter into hedging relationships with respect to such securities, or to formulate other purposes, plans or proposals in the future depending on market conditions and/or other factors.

Item 5.Interest in Securities of the Issuer

(a) and (b)

According to information provided by the Company to the Reporting Persons, there were 4,593,739 Ordinary Shares issued and outstanding as of January 6, 2012.

With respect to the amount of Ordinary Shares beneficially owned by each Reporting Person, the nature of such beneficial ownership and the related percentages of the class of Ordinary Shares, the information contained in each of the cover pages, and in Items 1 through 14 thereon, is incorporated by reference herein.

The aggregate number and percentage of the class of securities identified pursuant to Item 1 of this Amendment No. 1 that are beneficially owned by the Reporting Persons listed in Item 2 are as follows:

THCapFund I LLC may be deemed to have beneficial ownership of 333,301 Ordinary Shares, representing approximately 7.1% of the issued and outstanding Ordinary Shares as of January 6, 2012. All such shares are directly held and directly beneficially owned by THCapFund I LLC.

THCap LLC may be deemed to have beneficial ownership of 333,301 Ordinary Shares, representing approximately 7.1% of the issued and outstanding Ordinary Shares as of January 6, 2012, as the managing member of THCapFund I LLC.

THG LLC may be deemed to have beneficial ownership of 333,301 Ordinary Shares, representing approximately 7.1% of the issued and outstanding Ordinary Shares as of January 6, 2012, as the manager of THCap LLC.

Messrs. Wesley and Roy each may be deemed to have a beneficial ownership of 333,301 Ordinary Shares, representing approximately 7.1% of the issued and outstanding Ordinary Shares as of January 6, 2012, as the managing directors of THCap LLC and THG LLC.

Each of the Reporting Persons, other than THCapFund I LLC, expressly disclaim beneficial ownership of the shares of capital stock of the Company owned by all other Reporting Persons.

(c)Other than the shares reported herein, none of the Reporting Persons has effected any transactions involving the Ordinary Shares in the 60 days prior to filing this Amendment No. 1.

(d)THG LLC is the sole manager of THCap LLC, which is the sole managing member of THCapFund I LLC.  Messrs. Wesley and Roy are the managing directors of THG LLC and therefore have the power to direct its affairs, including decisions respecting the disposition of proceeds from the sale of the shares of the Company’s Ordinary Shares held by THCapFund I LLC.  Under certain circumstances set forth in the operating agreement of THCapFund I LLC, the members of such limited liability company have the right to receive distributions, either cash or in-kind, with respect to the shares of the Company’s Ordinary Shares held by THCapFund I LLC.  To the knowledge of the Reporting Persons, no other person has the right to receive or the power to direct the receipt of distributions with respect to the securities of the Company.

(e)Not applicable.

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Item 6.Contracts, Arrangements, Understandings or Relationships with Respect to Securities of the Issuer

Except as described above, there are no contracts, arrangements, understandings or relationships (legal or otherwise) among the Reporting Persons and any other person with respect to any securities of the Company, including but not limited to transfer or voting of any of the securities, finders fees, joint ventures, loan or option arrangements, puts or calls, guarantees of profits, division of profits or loss, or the giving or withholding of proxies.

Item 7.Material to be Filed as Exhibits

Exhibit 1	Share Purchase Agreement, made and entered into as of October 4, 2010, by and between the Company and THCapFund I LLC (incorporated by reference to the Schedule 13D filed by the Reporting Persons on October 14, 2010).
Exhibit 2	Form of Loan Agreement by and among the Company and certain lenders (incorporated by reference to the Company’s Annual Report on Form 20-F filed on June 30, 2010).
Exhibit 3	Form of Warrant issued by the Company to certain lenders (incorporated by reference to the Company’s Annual Report on Form 20-F filed on June 30, 2010).
Exhibit 4	Agreement, made and entered into as of November 9, 2011, by and among the Company and THCapFund I LLC.
Exhibit 5	Joint Filing Agreement, dated October 14, 2010 (incorporated by reference to the Schedule 13D filed by the Reporting Persons on October 14, 2010).

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Signature

After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.

Dated February 1, 2012

Telegraph Hill Capital Fund I, LLC
By: Telegraph Hill Capital, LLC
Its Managing Member
By: Telegraph Hill Group, LLC
Its Manager
By:	/s/ Luis Gutierrez Roy
	Luis Gutierrez Roy, Managing Director
Telegraph Hill Capital, LLC
By: Telegraph Hill Group, LLC
Its Manager
By:	/s/ Luis Gutierrez Roy
	Luis Gutierrez Roy, Managing Director
Telegraph Hill Group, LLC
By:	/s/ Luis Gutierrez Roy
	Luis Gutierrez Roy, Managing Director
/s/ Clarence V. Wesley
Clarence V. Wesley
/s/ Luis Gutierrez Roy
Luis Gutierrez Roy

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Exhibit Index

Exhibit 1	Share Purchase Agreement, made and entered into as of October 4, 2010, by and between the Company and THCapFund I LLC (incorporated by reference to the Schedule 13D filed by the Reporting Persons on October 14, 2010).
Exhibit 2	Form of Loan Agreement by and among the Company and certain lenders (incorporated by reference to the Company’s Annual Report on Form 20-F filed on June 30, 2010).
Exhibit 3	Form of Warrant issued by the Company to certain lenders (incorporated by reference to the Company’s Annual Report on Form 20-F filed on June 30, 2010).
Exhibit 4	Agreement, made and entered into as of November 9, 2011, by and among the Company and THCapFund I LLC.
Exhibit 5	Joint Filing Agreement, dated October 14, 2010 (incorporated by reference to the Schedule 13D filed by the Reporting Persons on October 14, 2010).

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EX-4

Exhibit 4

AGREEMENT

THIS AGREEMENT (the “Agreement”) is made as of the 9 day of November, 2011 (the “Effective Date”), by and between B.O.S Better Online Solutions Ltd. (the “Company”) and Telegraph Hill Capital Fund I, LLC. (the “Lender”).

W I T N E S S E T H:

WHEREAS, in July 2009, the Company and the Lender entered into a Loan Agreement in respect of a principal loan amount of $200,000 (the “ Loan Agreement”, and the “Convertible Loan”);

WHEREAS, pursuant to the terms thereof, the Convertible Loan is convertible at the election of the Lender, at anytime prior to its maturity date;

WHEREAS, the Company wishes to have the Lender convert its Convertible Loan into the Company’s Shares prior to the maturity date, and in order to induce Lender to do so has proposed certain amendments to the terms of the Convertible Loan and an extension to the Lender’s warrant, as more fully described below;

WHEREAS, the Lender agreed to convert its Convertible Loan on the terms on conditions described below; and

WHEREAS, the Company intends to submit the proposed amendment to the terms of the Convertible Loan to shareholders’ approval, such approval being a condition precedent to the Company’s performance of this Agreement.

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

1.Loan Conversion

1.1.By execution of this Agreement, Lender serves notice to the Company, pursuant to Section 2.4 of the Loan Agreement, of the conversion (the “Conversion”), as of Closing, of $241,501  of Convertible Loan (the “Converted Loan”, comprised of $200,000 of principal amount and $41,501 of accrued interest), into the Company’s ordinary shares, nominal value NIS 20.00 each (each, a “Share” and collectively, the “Shares”).

1.2.The Conversion shall take place at the Closing (as defined below), and shall be made at a reduced conversion price of $1.50 per Share, yielding an issuance to the Lender, at Closing, of 161,000 Shares (the “Converted Shares”).

2.Extension of Warrants

2.1.Subject to and conditioned upon the Conversion, the exercise period of the Lender’s outstanding warrant to purchase 61,539 Shares issued on July 22, 2009 (the “Warrant”) shall be extended by two years, until July 22 , 2014. A form of amendment to the Warrant is attached as Schedule 2.1 hereto.

2.2.The Warrant’s exercise price shall remain the same, $2.75 per Share (subject to adjustment in the event of share splits or consolidations, issuance of bonus shares, and similar recapitalization events).

3.Closing

3.1.Closing shall occur on December 21, 2011, subject to the prior approval by the Company’s Shareholders of the amendments to the Convertible Loan and the extension of the Warrant contemplated above; and provided that out of the approximately $3 million of principal and interest of convertible loans due in 2012, approximately $2.5 million (including the loan of the Lender) shall be converted into Shares at Closing. A table reflecting the total loans conversion to occur at Closing is attached as Schedule 3.1 hereto

3.2.At the Closing, the Conversion of the Converted Loan shall be effected automatically, the Converted Loan shall be deemed fully paid and the Converted Shares dully issued. Promptly following the Closing, the Company shall provide the Lender with a share certificate in respect of the Converted Shares.

4.Miscellaneous

4.1Amendments. This Agreement may be modified, supplemented or amended only by a written instrument executed by the Company and the Lender solely with respect to the Lenders rights and obligations.

4.2Notices.  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 set 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 Lender in writing;

if to the Lender, Telegraph Hill Group, LLC, 582 Market St., Suite 1700, San Francisco, CA 94104, U.S.A., c/o Luis Gutierrez-Roy, Managing Partner, e-mail: Lgroy@thcap.com, with a copy to Latham & Watkins LLP, 140 Scott Drive, Menlo Park, CA 94025, U.S.A., c/o Jim Morrone and Thomas Lloyd, Fax: +1 650 463 2600; or at any other address designated by the Lender to the Company in writing.

4.3Delays 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.

4.4Other 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.

4.5Entire 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.

4.6Headings.  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.

4.7Severability. 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

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the extent possible, the economic, business and other purposes of the void or unenforceable provision.

4.8Assignment. This Agreement may not be assigned in whole or in part by the Lender without the prior written consent of the Company.

4.9Governing 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.

4.10  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.

4.11  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 Agreement in one or more counterparts as of the date first appearing above.

B.O.S Better Online Solutions Ltd.		Telegraph Hill Capital Fund I, LLC.
By:	/s/ Eyal Cohen	By:	/s/ Luis Gutierrez-Roy
Name:	Eyal Cohen	Name:	Luis Gutierrez-Roy
Title:	CFO	Title:	Managing Partner
By:	/s/ Yuval Viner
Name:	Yuval Viner
Title:	CEO

3

Schedule 3.1

Conversion price	$	1.50
calculation date (AGM date)	21/12/2011

															additional
															shares
															underlying
						Total debt									conversion	Total
				Accumulated		and							% of		of debt and	outstanding	% of			Warrants			extended
	Debt	Principal		interest		interest as						Shares	holding		interest at	Shares	holding		Warrants	underlying			warrants
	Issuance	as of Dec.		as of AGM		of Dec. 21		Conversion		Conversion		held prior	prior		conversion	held post	post		underlying	debt -	exercise		expiration
Name	date	21 2011		Date		2012		rate		debt		conversion	conversion		price of $1.5	conversion	conversion		debt	extended	price		date
Catalyst Fund	22-Jul-09	$	530,000	$	109,977	$	639,977	100	%	$	639,977	423,452	15.2	%	426,651	850,103	19.0	%	163,077	163,077	$	2.75	22-Jul-14
SITA S.A.	22-Jul-09	$	561,800	$	116,575	$	678,375	100	%	$	678,375	175,734	6.3	%	452,250	627,984	14.1	%	172,862	172,862	$	2.75	22-Jul-14
Telegraph Hill Capital Fund	22-Jul-09	$	200,000	$	41,501	$	241,501	100	%	$	241,501	96,362	3.5	%	161,000	257,362	5.8	%	61,538	61,538	$	2.75	22-Jul-14
Yuval Viner	22-Jul-09	$	3,500	$	726	$	4,226	100	%	$	4,226	8,597	0.3	%	2,755	11,352	0.3	%	1,077	1,077	$	2.75	22-Jul-14
Avidan Zelikvosky	22-Jul-09	$	3,500	$	726	$	4,226	100	%	$	4,226	14,600	0.5	%	2,755	17,355	0.4	%	1,077	1,077	$	2.75	22-Jul-14
Eyal Cohen	22-Jul-09	$	1,000	$	208	$	1,208	100	%	$	1,208	—	0.0	%	743	743	0.0	%	308	308	$	2.75	22-Jul-14
Bellite Pty Limited	22-Jul-09	$	375,000	$	77,814	$	452,814	100	%	$	452,814	163,266	5.9	%	301,876	465,142	10.4	%	115,385	115,385	$	2.75	22-Jul-14
Dimex Systems Ltd.	03-Feb-10	$	161,594	$	25,524	$	187,118	50	%	$	93,559	91,449	3.3	%	62,373	153,822	3.4	%	49,721	24,861	$	2.75	03-Feb-15
Dimex Systems Ltd.	22-Jul-09	$	674,689	$	140,000	$	814,689	50	%	$	407,344				271,563	271,563	6.1	%	207,596	103,798	$	2.75	22-Jul-14
Total		$	2,511,083	$	513,050	$	3,024,133	83.44	%	$	2,523,230	973,460	35	%	1,681,966	2,655,426	59.4	%	772,640	643,982

4

Schedule 2.1

AMENDMENT TO

ORDINARY SHARES PURCHASE WARRANT

NO. BOS09-03

THIS AMENDMENT TO ORDINARY SHARES PURCHASE WARRANT (the “Amendment”) is made as of November 9, 2011 by and among B.O.S Better Online Solutions Ltd. (the “Company”) and Telegraph Hill Capital Fund I, LLC. Ltd. (the “Holder”).

Recitals

WHEREAS, the Company has granted to the Holder a warrant to purchase up to 61,539 shares of the Company, nominal value NIS 20.00 each (the “Ordinary Shares”) pursuant to an Ordinary Shares Purchase Warrant No. BOS09-03, dated July 22, 2009 (the “Warrant”); and

WHEREAS, the parties wish to amend the Warrant as specified below;

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

1.Capitalized terms used herein, which are not defined in this Amendment, shall have the meaning assigned to them in the Warrant.

2.The parties agree that the Expiration Date of the Warrant shall be extended by two years, until July 22, 2014.

3.Except as otherwise amended hereby, all terms and provisions of the Original Warrant shall continue in full force and effect.

IN WITNESS WHEREOF, the parties have executed this Amendment as of the date first written above, which may be executed and delivered by facsimile in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.

B.O.S Better Online Solutions Ltd.		Telegraph Hill Capital Fund I, LLC.
By:	/s/ Eyal Cohen	By:	/s/ Luis Gutierrez-Roy
Name:	Eyal Cohen	Name:	Luis Gutierrez-Roy
Title:	CFO	Title:	Managing Partner
By:	/s/ Yuval Viner
Name:	Yuval Viner
Title:	CEO

5