<SEC-DOCUMENT>0001213900-16-013899.txt : 20160531
<SEC-HEADER>0001213900-16-013899.hdr.sgml : 20160531
<ACCEPTANCE-DATETIME>20160531124511
ACCESSION NUMBER:		0001213900-16-013899
CONFORMED SUBMISSION TYPE:	6-K
PUBLIC DOCUMENT COUNT:		2
CONFORMED PERIOD OF REPORT:	20160531
FILED AS OF DATE:		20160531
DATE AS OF CHANGE:		20160531

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			BOS BETTER ONLINE SOLUTIONS LTD
		CENTRAL INDEX KEY:			0001005516
		STANDARD INDUSTRIAL CLASSIFICATION:	COMPUTER COMMUNICATIONS EQUIPMENT [3576]
		IRS NUMBER:				000000000
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		6-K
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	001-14184
		FILM NUMBER:		161684744

	BUSINESS ADDRESS:	
		STREET 1:		20 FREIMAN STREET
		CITY:			RISHON LEZION
		STATE:			L3
		ZIP:			75100
		BUSINESS PHONE:		011-972-3-954-1000

	MAIL ADDRESS:	
		STREET 1:		20 FREIMAN STREET
		CITY:			RISHON LEZION
		STATE:			L3
		ZIP:			75100
</SEC-HEADER>
<DOCUMENT>
<TYPE>6-K
<SEQUENCE>1
<FILENAME>f6k053116_bosbetteronline.htm
<DESCRIPTION>REPORT OF FOREIGN PRIVATE ISSUER
<TEXT>
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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt; text-align: center; padding-left: 0pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center; padding-left: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">FORM
6 - K</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center; padding-left: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

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AND EXCHANGE COMMISSION</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center; padding-left: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Washington,
D.C. 20549</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center; padding-left: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center; padding-left: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Report
of Foreign Private Issuer</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center; padding-left: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center; padding-left: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Pursuant
to Rule 13a - 16 or 15d - 16</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center; padding-left: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Under
the Securities Exchange Act of 1934</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center; padding-left: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center; padding-left: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">For
the Month of May 2016</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center; padding-left: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center; padding-left: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Commission&nbsp;file&nbsp;number
001-14184</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center; padding-left: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center; padding-left: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 12pt"><U>B.O.S.
Better Online Solutions Ltd.</U></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center; padding-left: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(Translation
of Registrant's Name into English)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center; padding-left: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center; padding-left: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><U>20
Freiman Street, Rishon LeZion, 75100, Israel&nbsp;</U></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center; padding-left: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(Address
of principal executive office)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt; text-align: center; padding-left: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt; padding-left: 0pt; text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Indicate
by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt; padding-left: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: center; margin-bottom: 0pt; padding-left: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Form
20-F <U> </U>&#9746;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Form 40-F&nbsp;&nbsp;&#9744;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt; padding-left: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt; padding-left: 0pt; text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Indicate
by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ___________</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt; padding-left: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt; padding-left: 0pt; text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Indicate
by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ___________</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt; padding-left: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt; text-align: justify; padding-left: 0pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt; text-align: justify; padding-left: 0pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt; text-align: center; padding-left: 0pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt; text-align: center; padding-left: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">B.O.S.
Better Online Solutions Ltd.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt; text-align: center; padding-left: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt; text-align: justify; padding-left: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><A NAME="a_DV_M6"></A><A NAME="a_DV_M8"></A><A NAME="a_DV_M9"></A><A NAME="a_DV_M11"></A><A NAME="a_DV_M12"></A><A NAME="a_DV_M13"></A>The
GAAP financial statements, included in the Press Release that is attached to this Form 6-K, are hereby incorporated by reference
into all effective registration statements filed by us under the Securities Act of 1933, as amended, to the extent not superseded
by documents or reports subsequently filed or furnished.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt; text-align: justify; padding-left: 0pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt; text-align: justify; padding-left: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Attached
hereto are the following exhibits:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt; text-align: justify; padding-left: 0pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif; background-color: rgb(204,238,255)">
    <TD STYLE="width: 6%; padding: 0pt; font: 10pt Times New Roman, Times, Serif; text-indent: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><A NAME="TabDataBeginIP"></A>99.1</FONT></TD>
    <TD STYLE="width: 94%; padding: 0pt; font: 10pt Times New Roman, Times, Serif; text-indent: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Press
    Release: B.O.S. Better Online Solutions Reports Financial Results for the First Quarter of Fiscal Year 2016.</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt; text-align: center; padding-left: 0pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt; text-align: center; padding-left: 0pt"></P>

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    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><P STYLE="margin: 0pt">&nbsp;</P></DIV>
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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt; text-align: center; padding-left: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>




<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt; text-align: center; padding-left: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Signature</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt; text-align: center; padding-left: 0pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt; text-align: justify; padding-left: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Pursuant
to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf
by the undersigned, thereunto duly authorized.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt; text-align: center; padding-left: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; border-collapse: collapse; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; padding: 0pt; text-indent: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="padding: 0pt; text-indent: 0pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">B.O.S.
    Better Online Solutions Ltd.</FONT></TD></TR>
<TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding: 0pt; text-indent: 0pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="padding: 0pt; text-indent: 0pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;(Registrant)</FONT></TD></TR>
<TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding: 0pt; text-indent: 0pt; font: 10pt Times New Roman, Times, Serif; width: 60%"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding: 0pt; text-indent: 0pt; width: 4%; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding: 0pt; text-indent: 0pt; font: 10pt Times New Roman, Times, Serif; width: 36%"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding: 0pt; text-indent: 0pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding: 0pt; text-indent: 0pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">By:</FONT></TD>
    <TD STYLE="padding: 0pt; text-indent: 0pt; font: 10pt Times New Roman, Times, Serif; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">/s/
    Eyal Cohen</FONT></TD></TR>
<TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding: 0pt; text-indent: 0pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding: 0pt; text-indent: 0pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding: 0pt; text-indent: 0pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Eyal
    Cohen</FONT></TD></TR>
<TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding: 0pt; text-indent: 0pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding: 0pt; text-indent: 0pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding: 0pt; text-indent: 0pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Chief
    Financial Officer</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt; text-indent: 0pt; padding-left: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt; padding-left: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Dated:
May 31, 2016</FONT></P>




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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt; text-align: center; background-color: white; padding-left: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">EXHIBIT
INDEX</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt; background-color: white; text-indent: 0.5in; padding-left: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; border-collapse: collapse; font: 10pt Times New Roman, Times, Serif">
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    <TD STYLE="padding-top: 0pt; padding-right: 0pt; border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; padding-left: 0pt; text-decoration: none; text-indent: 0pt; width: 11%"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">EXHIBIT
    NO.</FONT></TD>
    <TD STYLE="width: 1%; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="padding-top: 0pt; padding-right: 0pt; border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; padding-left: 0pt; text-decoration: none; text-indent: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">DESCRIPTION</FONT></TD></TR>
<TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding: 0pt; text-indent: 0pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD STYLE="padding: 0pt; text-indent: 0pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif; background-color: rgb(204,238,255)">
    <TD STYLE="padding: 0pt; text-indent: 0pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">99.1</FONT></TD>
    <TD>&nbsp;</TD>
    <TD STYLE="padding: 0pt; text-indent: 0pt; font: 10pt Times New Roman, Times, Serif; text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Press
    Release: B.O.S. Better Online Solutions Reports Financial Results for the First Quarter of Fiscal Year 2016.</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt; padding-left: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt; padding-left: 0pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt; padding-left: 0pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: center; margin-bottom: 0pt; padding-left: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">4</FONT></P>

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<DOCUMENT>
<TYPE>EX-99.1
<SEQUENCE>2
<FILENAME>f6k053116ex99i_bosbetter.htm
<DESCRIPTION>PRESS RELEASE: B.O.S. BETTER ONLINE SOLUTIONS REPORTS FINANCIAL RESULTS FOR THE FIRST QUARTER OF FISCAL YEAR 2016
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<P STYLE="margin: 0; font: 10pt Times New Roman, Times, Serif; text-align: right"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Exhibit
99.1</B></FONT></P>

<P STYLE="margin: 0; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT>&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>B.O.S.
Better Online Solutions Reports Financial Results for the First Quarter of Fiscal Year 2016</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>38%
Growth in revenues over comparable quarter of 2015 and Net profit of $220,000 </B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>RISHON
LEZION, Israel, May 31, 2016 (GLOBE NEWSWIRE) - </B>B.O.S. Better Online Solutions Ltd. (the &quot;Company&quot;, &quot;BOS&quot;)
(Nasdaq: <U>BOSC</U>), a leading Israeli provider of RFID and Mobile solutions and a global provider of Supply Chain solutions
to enterprises, today reported its financial results for the first quarter of fiscal year 2016.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><U>Highlights
of the first quarter of 2016 results:</U></FONT></P>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>
<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%">
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    <TD STYLE="width: 24px; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD>
    <TD STYLE="text-align: justify; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Revenues
    grew by 38% over the comparable quarter last year.</FONT></TD></TR>
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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

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<TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif">

    <TD STYLE="width: 24px; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD>
    <TD STYLE="text-align: justify; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Net
    profit amounted to $220,000 as compared to a net loss of $23,000 in the comparable period last year.</FONT></TD></TR>
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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

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<TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif">

    <TD STYLE="width: 24px; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD>
    <TD STYLE="text-align: justify; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Net
    profit, on a NON GAAP basis, amounted to $314,000 as compared to a net profit of $33,000 in the comparable period last year.</FONT></TD></TR>
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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%">
<TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif">

    <TD STYLE="width: 24px; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD>
    <TD STYLE="text-align: justify; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">EBITDA
    amounted to $413,000 as compared to $192,000 in the comparable period last year.</FONT></TD></TR>
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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in; text-align: justify; text-indent: 0.5in"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in; text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Yuval
Viner, BOS' CEO, stated: &quot;We are very pleased with our first quarter's results. Revenues for the first quarter of year 2016
grew by 38%, to approximately $8.1 million, from $5.8 million in the comparable quarter last year. This increase is primarily
due to organic growth in both our divisions.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Supply
Chain division revenues for the first quarter of 2016 grew by 28%, to $4.6 million from $3.6 million in the first quarter of year
2015. The growth was mainly in sales to customers in the Far East and to the Israeli defense industry.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">RFID
and Mobile solutions revenues for the first quarter of 2016 grew by 54%, to $3.5 million from $2.2 million in the first quarter
of year 2015. The growth was attributed to increased demand from existing customers for their new and existing logistic centers.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">In
addition, an amount of $0.5 million of revenues is attributed to our acquisition of iDnext Ltd. and its subsidiary, Next-Line
Ltd. in January 2016.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Our
outlook for the year 2016 is an increase in revenues and in profits as compared to 2015.&quot;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT>&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Avidan
Zelicovsky, BOS' President, stated: &quot;We are pleased to have achieved a fourth consecutive quarter of net profit on a GAAP
basis. We are working extensively to grow our Supply Chain division geographically, mainly in the Far East, and to expand our
product offerings.&quot;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Eyal
Cohen, BOS' CFO, stated: &quot;Our last twelve months' EBITDA amounted to $1.25 million and our debt, net of cash and deposits,
as of March 31, 2016 amounted to $2.8 million. Going forward, we anticipate a reduction in our debt. During the first quarter
of 2016, cash and cash equivalents decreased by approximately $700,000, mostly due to working capital needs related to the iDnext
acquisition&quot;.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">BOS
will host a conference call on Tuesday, June 1, 2016 at 10 a.m. EDT - 5:00 p.m., Israel Time. A question-and-answer session will
follow management&rsquo;s presentation. Interested parties may participate in the conference call by dialing + 972-3-9180644,
approximately five to ten minutes before the call start time.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">For
those unable to listen to the live call, a script of the call will be available the next day after the call on BOS&rsquo;s website,
at: http://www.boscorporate.com</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>About
BOS</B><BR>
B.O.S. Better Online Solutions Ltd. (BOSC) is a leading Israeli provider of RFID and Mobile solutions and a global provider of
Supply Chain solutions to enterprises. BOS' RFID and Mobile division offers both turnkey integration services as well as stand-alone
products, including best-of-breed RFID and AIDC hardware and communications equipment and industry-specific software applications.
The Company's Supply Chain division provides electronic components consolidation services to the aerospace, defense, medical and
telecommunications industries as well as to enterprise customers worldwide. For more information, please visit: www.boscorporate.com.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">For
more information:<BR>
Eyal Cohen<BR>
CFO<BR>
+972-542525925</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Use
of Non-GAAP Financial Information </B><BR>
BOS reports financial results in accordance with U.S. GAAP and herein provides some non-GAAP measures. These non-GAAP measures
are not in accordance with, nor are they a substitute for, GAAP measures. These non-GAAP measures are intended to supplement the
Company&rsquo;s presentation of its financial results that are prepared in accordance with GAAP. The Company uses the non-GAAP
measures presented to evaluate and manage the Company&rsquo;s operations internally. The Company is also providing this information
to assist investors in performing additional financial analysis that is consistent with financial models developed by research
analysts who follow the Company. The reconciliation set forth below is provided in accordance with Regulation G and reconciles
the non-GAAP financial measures with the most directly comparable GAAP financial measures.<BR>
<FONT STYLE="color: #324750">&nbsp;</FONT><BR>
<B>Safe Harbor Regarding Forward-Looking Statements </B><BR>
The forward-looking statements contained herein reflect management's current views with respect to future events and financial
performance. These forward-looking statements are subject to certain risks and uncertainties that could cause the actual results
to differ materially from those in the forward-looking statements, all of which are difficult to predict and many of which are
beyond the control of BOS.&nbsp; These risk factors and uncertainties include, amongst others, the dependency of sales being generated
from one or few major customers, the uncertainty of BOS being able to maintain current gross profit margins, inability to keep
up or ahead of technology and to succeed in a highly competitive industry, inability to maintain marketing and distribution arrangements
and to expand our overseas markets, uncertainty with respect to the prospects of legal claims against BOS, the effect of exchange
rate fluctuations, general worldwide economic conditions and continued availability of financing for working capital purposes
and to refinance outstanding indebtedness; and additional risks and uncertainties detailed in BOS's periodic reports and registration
statements filed with the U.S. Securities Exchange Commission. BOS undertakes no obligation to publicly update or revise any such
forward-looking statements to reflect any change in its expectations or in events, conditions or circumstances on which any such
statements may be based, or that may affect the likelihood that actual results will differ from those set forth in the forward-looking
statements.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT>&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>CONSOLIDATED
STATEMENTS OF OPERATIONS</B></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">U.S.
dollars in thousands</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: right; text-indent: 0.5in"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="font-weight: bold; padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD COLSPAN="6" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid; padding: 0pt; text-indent: 0pt">Three months ended<BR> March 31,</TD><TD STYLE="padding: 0pt; font-weight: bold; text-indent: 0pt">&nbsp;</TD><TD STYLE="font-weight: bold; padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; padding: 0pt; text-indent: 0pt">Year ended<BR> &nbsp;December&nbsp;31,</TD><TD STYLE="padding: 0pt; font-weight: bold; text-indent: 0pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="font-weight: bold; padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid; padding: 0pt; text-indent: 0pt">2016</TD><TD STYLE="padding: 0pt; font-weight: bold; text-indent: 0pt">&nbsp;</TD><TD STYLE="font-weight: bold; padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid; padding: 0pt; text-indent: 0pt">2015</TD><TD STYLE="padding: 0pt; font-weight: bold; text-indent: 0pt">&nbsp;</TD><TD STYLE="font-weight: bold; padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid; padding: 0pt; text-indent: 0pt">2015</TD><TD STYLE="padding: 0pt; font-weight: bold; text-indent: 0pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="font-weight: bold; padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD COLSPAN="6" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid; padding: 0pt; text-indent: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>(Unaudited)</B></FONT></TD><TD STYLE="padding: 0pt; font-weight: bold; text-indent: 0pt">&nbsp;</TD><TD STYLE="font-weight: bold; padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid; padding: 0pt; text-indent: 0pt">(Audited)</TD><TD STYLE="padding: 0pt; font-weight: bold; text-indent: 0pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 64%; text-align: left; text-indent: 0pt; padding: 0pt">Revenues</TD><TD STYLE="width: 1%; padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left; padding: 0pt; text-indent: 0pt">$</TD><TD STYLE="width: 9%; text-align: right; padding: 0pt; text-indent: 0pt">8,067</TD><TD STYLE="width: 1%; text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="width: 1%; padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left; padding: 0pt; text-indent: 0pt">$</TD><TD STYLE="width: 9%; text-align: right; padding: 0pt; text-indent: 0pt">5,827</TD><TD STYLE="width: 1%; text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="width: 1%; padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left; padding: 0pt; text-indent: 0pt">$</TD><TD STYLE="width: 9%; text-align: right; padding: 0pt; text-indent: 0pt">25,599</TD><TD STYLE="width: 1%; text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">Cost of revenues</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0pt; text-align: right; text-indent: 0pt">6,516</TD><TD STYLE="padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0pt; text-align: right; text-indent: 0pt">4,640</TD><TD STYLE="padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0pt; text-align: right; text-indent: 0pt">20,462</TD><TD STYLE="padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">Gross profit</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0pt; text-align: right; text-indent: 0pt">1,551</TD><TD STYLE="padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0pt; text-align: right; text-indent: 0pt">1,187</TD><TD STYLE="padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0pt; text-align: right; text-indent: 0pt">5,137</TD><TD STYLE="padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: 0pt; padding: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: right; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: right; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: right; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: 0pt; padding: 0pt">Operating costs and expenses:</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: right; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: right; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: right; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding: 0pt 0pt 0pt 10pt; text-indent: 0pt">Sales and marketing</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: right; padding: 0pt; text-indent: 0pt">791</TD><TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: right; padding: 0pt; text-indent: 0pt">678</TD><TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: right; padding: 0pt; text-indent: 0pt">2,768</TD><TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding: 0pt 0pt 0pt 10pt; text-indent: 0pt">General and administrative</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0pt; text-align: right; text-indent: 0pt">458</TD><TD STYLE="padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0pt; text-align: right; text-indent: 0pt">409</TD><TD STYLE="padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0pt; text-align: right; text-indent: 0pt">1,681</TD><TD STYLE="padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">Total operating costs and expenses</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0pt; text-align: right; text-indent: 0pt">1,249</TD><TD STYLE="padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0pt; text-align: right; text-indent: 0pt">1,087</TD><TD STYLE="padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0pt; text-align: right; text-indent: 0pt">4,449</TD><TD STYLE="padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: 0pt; padding: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: right; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: right; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: right; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: 0pt; padding: 0pt">Operating Income</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: right; padding: 0pt; text-indent: 0pt">302</TD><TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: right; padding: 0pt; text-indent: 0pt">100</TD><TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: right; padding: 0pt; text-indent: 0pt">688</TD><TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">Financial expenses, net</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0pt; text-align: right; text-indent: 0pt">(82</TD><TD STYLE="padding: 0pt; text-align: left; text-indent: 0pt">)</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0pt; text-align: right; text-indent: 0pt">(123</TD><TD STYLE="padding: 0pt; text-align: left; text-indent: 0pt">)</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0pt; text-align: right; text-indent: 0pt">(376</TD><TD STYLE="padding: 0pt; text-align: left; text-indent: 0pt">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: 0pt; padding: 0pt">Income (loss) before taxes on income</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: right; padding: 0pt; text-indent: 0pt">220</TD><TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: right; padding: 0pt; text-indent: 0pt">(23</TD><TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">)</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: right; padding: 0pt; text-indent: 0pt">312</TD><TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">Taxes on income (tax benefit)</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0pt; text-align: right; text-indent: 0pt">-</TD><TD STYLE="padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0pt; text-align: right; text-indent: 0pt">1</TD><TD STYLE="padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0pt; text-align: right; text-indent: 0pt">(22</TD><TD STYLE="padding: 0pt; text-align: left; text-indent: 0pt">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">Net income (loss)</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; padding: 0pt; text-align: right; text-indent: 0pt">220</TD><TD STYLE="padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; padding: 0pt; text-align: right; text-indent: 0pt">(24</TD><TD STYLE="padding: 0pt; text-align: left; text-indent: 0pt">)</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; padding: 0pt; text-align: right; text-indent: 0pt">334</TD><TD STYLE="padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: 0pt; padding: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: right; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: right; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: right; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">Basic and diluted net income (loss) per share</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; padding: 0pt; text-align: left; text-indent: 0pt">$</TD><TD STYLE="border-bottom: Black 4pt double; padding: 0pt; text-align: right; text-indent: 0pt">0.09</TD><TD STYLE="padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; padding: 0pt; text-align: left; text-indent: 0pt">$</TD><TD STYLE="border-bottom: Black 4pt double; padding: 0pt; text-align: right; text-indent: 0pt">(0.01</TD><TD STYLE="padding: 0pt; text-align: left; text-indent: 0pt">)</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; padding: 0pt; text-align: left; text-indent: 0pt">$</TD><TD STYLE="border-bottom: Black 4pt double; padding: 0pt; text-align: right; text-indent: 0pt">0.17</TD><TD STYLE="padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: 0pt; padding: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: right; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: right; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: right; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding: 0pt 0pt 0pt 10pt; text-indent: -10pt">Weighted average number of shares used in computing basic and diluted net income (loss) per share</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; padding: 0pt; text-align: right; text-indent: 0pt">2,379</TD><TD STYLE="padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; padding: 0pt; text-align: right; text-indent: 0pt">1,816</TD><TD STYLE="padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; padding: 0pt; text-align: right; text-indent: 0pt">1,970</TD><TD STYLE="padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<!-- Field: Page; Sequence: 3; Value: 2 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt; border-bottom: Black 1.5pt solid"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font-size: 10pt"><TR STYLE="vertical-align: top; text-align: left"><TD STYLE="width: 33%">&nbsp;</TD><TD STYLE="width: 34%; text-align: center"><!-- Field: Sequence; Type: Arabic; Name: PageNo -->3<!-- Field: /Sequence --></TD><TD STYLE="width: 33%; text-align: right">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><P STYLE="margin: 0pt">&nbsp;</P></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; text-align: center; margin-bottom: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; border-bottom: black 1.5pt solid; margin-bottom: 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>CONSOLIDATED
BALANCE SHEETS</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(U.S.
dollars in thousands)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font: 10pt Times New Roman, Times, Serif; border-bottom: Black 1.5pt solid; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>March
31, 2016</B></FONT></TD><TD STYLE="padding-bottom: 1.5pt; font: 10pt Times New Roman, Times, Serif; text-align: center">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt; text-align: center">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font: 10pt Times New Roman, Times, Serif; border-bottom: Black 1.5pt solid; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>December&nbsp;31,
2015</B></FONT></TD><TD STYLE="padding-bottom: 1.5pt; font: 10pt Times New Roman, Times, Serif; text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt; text-align: center; padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>(Unaudited)</B></FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1.5pt solid"><B>(Audited)</B></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif">ASSETS</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif">CURRENT ASSETS:</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 76%; font: 10pt Times New Roman, Times, Serif; text-align: left; padding-left: 10pt">Cash and cash equivalents</TD><TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="width: 9%; font: 10pt Times New Roman, Times, Serif; text-align: right">723</TD><TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="width: 9%; font: 10pt Times New Roman, Times, Serif; text-align: right">1,419</TD><TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left; padding-left: 10pt">Restricted bank deposits</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">177</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">195</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left; padding-left: 10pt">Trade receivables</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">8,303</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">7,071</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left; padding-left: 10pt">Other accounts receivable and prepaid expenses</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">712</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">725</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt; padding-left: 10pt">Inventories</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">2,351</TD><TD STYLE="padding-bottom: 1.5pt; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">2,503</TD><TD STYLE="padding-bottom: 1.5pt; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-decoration: none; text-align: left; padding-bottom: 1.5pt"><U>Total
    </U>current assets</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">12,266</TD><TD STYLE="padding-bottom: 1.5pt; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">11,913</TD><TD STYLE="padding-bottom: 1.5pt; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left; padding-bottom: 1.5pt">LONG-TERM ASSETS</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">52</TD><TD STYLE="padding-bottom: 1.5pt; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">303</TD><TD STYLE="padding-bottom: 1.5pt; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left; padding-bottom: 1.5pt">PROPERTY, PLANT AND EQUIPMENT, NET</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">551</TD><TD STYLE="padding-bottom: 1.5pt; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">480</TD><TD STYLE="padding-bottom: 1.5pt; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left; padding-bottom: 1.5pt">OTHER INTANGIBLE ASSETS, NET</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">238</TD><TD STYLE="padding-bottom: 1.5pt; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">7</TD><TD STYLE="padding-bottom: 1.5pt; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt">GOODWILL</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">4,676</TD><TD STYLE="padding-bottom: 1.5pt; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">4,122</TD><TD STYLE="padding-bottom: 1.5pt; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-decoration: underline; text-align: left; padding-bottom: 4pt">Total assets</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="border-bottom: Black 4pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">17,783</TD><TD STYLE="padding-bottom: 4pt; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="border-bottom: Black 4pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">16,825</TD><TD STYLE="padding-bottom: 4pt; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt/115% Times New Roman, Times, Serif; margin: 0; text-indent: 0">&nbsp; &nbsp;</P>

<!-- Field: Page; Sequence: 4; Value: 2 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt; border-bottom: Black 1.5pt solid"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font-size: 10pt"><TR STYLE="vertical-align: top; text-align: left"><TD STYLE="width: 33%">&nbsp;</TD><TD STYLE="width: 34%; text-align: center"><!-- Field: Sequence; Type: Arabic; Name: PageNo -->4<!-- Field: /Sequence --></TD><TD STYLE="width: 33%; text-align: right">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><P STYLE="margin: 0pt">&nbsp;</P></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt/115% Times New Roman, Times, Serif; margin: 0; text-indent: 0">&nbsp;<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; border-bottom: black 1.5pt solid; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>CONSOLIDATED
BALANCE SHEETS</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(U.S.
dollars in thousands)&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="font-weight: bold; padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid; padding: 0pt; text-indent: 0pt">March 31, 2016</TD><TD STYLE="padding: 0pt; font-weight: bold; text-indent: 0pt">&nbsp;</TD><TD STYLE="font-weight: bold; padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid; padding: 0pt; text-indent: 0pt">December&nbsp;31, 2015</TD><TD STYLE="padding: 0pt; font-weight: bold; text-indent: 0pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="font-weight: bold; padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid; padding: 0pt; text-indent: 0pt">(Unaudited)</TD><TD STYLE="padding: 0pt; font-weight: bold; text-indent: 0pt">&nbsp;</TD><TD STYLE="font-weight: bold; padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid; padding: 0pt; text-indent: 0pt">(Audited)</TD><TD STYLE="padding: 0pt; font-weight: bold; text-indent: 0pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">LIABILITIES AND SHAREHOLDERS' EQUITY</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">CURRENT LIABILITIES:</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 76%; text-align: left; text-indent: 0pt; padding: 0pt 0pt 0pt 10pt">Current maturities of long term loans</TD><TD STYLE="width: 1%; padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="width: 9%; text-align: right; padding: 0pt; text-indent: 0pt">400</TD><TD STYLE="width: 1%; text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="width: 1%; padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="width: 9%; text-align: right; padding: 0pt; text-indent: 0pt">400</TD><TD STYLE="width: 1%; text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: 0pt; padding: 0pt 0pt 0pt 10pt">Trade payables</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: right; padding: 0pt; text-indent: 0pt">4,668</TD><TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: right; padding: 0pt; text-indent: 0pt">4,671</TD><TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: 0pt; padding: 0pt 0pt 0pt 10pt">Employees and payroll accruals</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: right; padding: 0pt; text-indent: 0pt">655</TD><TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: right; padding: 0pt; text-indent: 0pt">480</TD><TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: 0pt; padding: 0pt 0pt 0pt 10pt">Deferred revenues</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: right; padding: 0pt; text-indent: 0pt">718</TD><TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: right; padding: 0pt; text-indent: 0pt">796</TD><TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding: 0pt 0pt 0pt 10pt; text-indent: 0pt">Accrued expenses and other liabilities</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0pt; text-align: right; text-indent: 0pt">462</TD><TD STYLE="padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0pt; text-align: right; text-indent: 0pt">320</TD><TD STYLE="padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: right; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: right; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-decoration: none; text-align: left; padding: 0pt; text-indent: 0pt"><U>Total</U> current liabilities</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0pt; text-align: right; text-indent: 0pt">6,903</TD><TD STYLE="padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0pt; text-align: right; text-indent: 0pt">6,667</TD><TD STYLE="padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: right; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: right; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">LONG-TERM LIABILITIES:</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: right; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: right; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: 0pt; padding: 0pt 0pt 0pt 10pt">Long-term loans, net of current maturities</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: right; padding: 0pt; text-indent: 0pt">3,349</TD><TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: right; padding: 0pt; text-indent: 0pt">3,458</TD><TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: 0pt; padding: 0pt 0pt 0pt 10pt">Liability related to acquisition of business</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: right; padding: 0pt; text-indent: 0pt">187</TD><TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: right; padding: 0pt; text-indent: 0pt">-</TD><TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: 0pt; padding: 0pt 0pt 0pt 10pt">Accrued severance pay</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: right; padding: 0pt; text-indent: 0pt">163</TD><TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: right; padding: 0pt; text-indent: 0pt">155</TD><TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding: 0pt 0pt 0pt 10pt; text-indent: 0pt">Deferred gain</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0pt; text-align: right; text-indent: 0pt">34</TD><TD STYLE="padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0pt; text-align: right; text-indent: 0pt">40</TD><TD STYLE="padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: right; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: right; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-decoration: none; text-align: left; padding: 0pt; text-indent: 0pt"><U>Total</U> long-term liabilities</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0pt; text-align: right; text-indent: 0pt">3,733</TD><TD STYLE="padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0pt; text-align: right; text-indent: 0pt">3,653</TD><TD STYLE="padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: right; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: right; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">SHAREHOLDERS' EQUITY</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0pt; text-align: right; text-indent: 0pt">7,147</TD><TD STYLE="padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0pt; text-align: right; text-indent: 0pt">6,505</TD><TD STYLE="padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: right; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: right; padding: 0pt; text-indent: 0pt">&nbsp;</TD><TD STYLE="text-align: left; padding: 0pt; text-indent: 0pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-decoration: none; text-align: left; padding: 0pt; text-indent: 0pt"><U>Total</U> liabilities and shareholders'
    equity</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; padding: 0pt; text-align: left; text-indent: 0pt">$</TD><TD STYLE="border-bottom: Black 4pt double; padding: 0pt; text-align: right; text-indent: 0pt">17,783</TD><TD STYLE="padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD><TD STYLE="padding: 0pt; text-indent: 0pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; padding: 0pt; text-align: left; text-indent: 0pt">$</TD><TD STYLE="border-bottom: Black 4pt double; padding: 0pt; text-align: right; text-indent: 0pt">16,825</TD><TD STYLE="padding: 0pt; text-align: left; text-indent: 0pt">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>RECONCILIATION
OF NON-GAAP FINANCIAL RESULTS</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(U.S.
dollars in thousands)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt; text-align: center">&nbsp;</TD><TD STYLE="font: bold 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt; text-align: center">&nbsp;</TD>
    <TD COLSPAN="6" STYLE="font: bold 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1.5pt solid">Three months ended<BR> March 31,</TD><TD STYLE="padding-bottom: 1.5pt; font: bold 10pt Times New Roman, Times, Serif; text-align: center">&nbsp;</TD><TD STYLE="font: bold 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt; text-align: center">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font: bold 10pt Times New Roman, Times, Serif; text-align: center">Year ended December&nbsp;31,</TD><TD STYLE="padding-bottom: 1.5pt; font: bold 10pt Times New Roman, Times, Serif; text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt; text-align: center">&nbsp;</TD><TD STYLE="font: bold 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt; text-align: center">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font: bold 10pt Times New Roman, Times, Serif; border-bottom: Black 1.5pt solid; text-align: center">2016</TD><TD STYLE="padding-bottom: 1.5pt; font: bold 10pt Times New Roman, Times, Serif; text-align: center">&nbsp;</TD><TD STYLE="font: bold 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt; text-align: center">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font: bold 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1.5pt solid">2015</TD><TD STYLE="padding-bottom: 1.5pt; font: bold 10pt Times New Roman, Times, Serif; text-align: center">&nbsp;</TD><TD STYLE="font: bold 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt; text-align: center">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font: bold 10pt Times New Roman, Times, Serif; border-bottom: Black 1.5pt solid; text-align: center">2015</TD><TD STYLE="padding-bottom: 1.5pt; font: bold 10pt Times New Roman, Times, Serif; text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt; text-align: center">&nbsp;</TD><TD STYLE="font: bold 10pt Times New Roman, Times, Serif; text-align: center">&nbsp;</TD>
    <TD COLSPAN="6" STYLE="font: bold 10pt Times New Roman, Times, Serif; text-align: center">(Unaudited)</TD><TD STYLE="font: bold 10pt Times New Roman, Times, Serif; text-align: center">&nbsp;</TD><TD STYLE="font: bold 10pt Times New Roman, Times, Serif; text-align: center">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font: bold 10pt Times New Roman, Times, Serif; text-align: center">(Unaudited)</TD><TD STYLE="font: bold 10pt Times New Roman, Times, Serif">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 64%; font: 10pt Times New Roman, Times, Serif; text-align: left">Net Income (loss)&nbsp;&nbsp;as reported </TD><TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="width: 9%; font: 10pt Times New Roman, Times, Serif; text-align: right">220</TD><TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="width: 9%; font: 10pt Times New Roman, Times, Serif; text-align: right">(24</TD><TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif; text-align: left">)</TD><TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="width: 9%; font: 10pt Times New Roman, Times, Serif; text-align: right">334</TD><TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif">Adjustments: </TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">Amortization of intangible assets </TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">30</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">16</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">63</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">Stock based compensation </TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">34</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">41</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">130</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left; padding-bottom: 1.5pt">Acquisition expenses </TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">30</TD><TD STYLE="padding-bottom: 1.5pt; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">-</TD><TD STYLE="padding-bottom: 1.5pt; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">49</TD><TD STYLE="padding-bottom: 1.5pt; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left; padding-bottom: 1.5pt">Total Adjustments </TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">94</TD><TD STYLE="padding-bottom: 1.5pt; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">57</TD><TD STYLE="padding-bottom: 1.5pt; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">242</TD><TD STYLE="padding-bottom: 1.5pt; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left; padding-bottom: 4pt">Net Income on a&nbsp;&nbsp;Non-GAAP basis </TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="border-bottom: Black 4pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">314</TD><TD STYLE="padding-bottom: 4pt; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="border-bottom: Black 4pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">33</TD><TD STYLE="padding-bottom: 4pt; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="border-bottom: Black 4pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">576</TD><TD STYLE="padding-bottom: 4pt; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD></TR>
</TABLE>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>CONDENSED
CONSOLIDATED EBITDA</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(U.S.
dollars in thousands)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: bold 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="6" STYLE="font: bold 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Three
    months ended<BR>
    March 31,</FONT></TD><TD STYLE="padding-bottom: 1.5pt; font: bold 10pt Times New Roman, Times, Serif; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;<B>Year
    ended December 31,</B></FONT></TD><TD STYLE="padding-bottom: 1.5pt; font: 10pt Times New Roman, Times, Serif; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: bold 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="font: bold 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">2016</FONT></TD><TD STYLE="padding-bottom: 1.5pt; font: bold 10pt Times New Roman, Times, Serif; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: bold 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="font: bold 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">2015</FONT></TD><TD STYLE="padding-bottom: 1.5pt; font: bold 10pt Times New Roman, Times, Serif; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="font: 10pt Times New Roman, Times, Serif; border-bottom: Black 1.5pt solid; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;<B>2015</B></FONT></TD><TD STYLE="padding-bottom: 1.5pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 64%; font: 10pt Times New Roman, Times, Serif; text-align: left; padding-left: -10pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Operating
    income</FONT></TD><TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">$</FONT></TD><TD STYLE="width: 9%; font: 10pt Times New Roman, Times, Serif; text-align: right"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">302</FONT></TD><TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">$</FONT></TD><TD STYLE="width: 9%; font: 10pt Times New Roman, Times, Serif; text-align: right"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">100</FONT></TD><TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">$</FONT></TD><TD STYLE="width: 9%; font: 10pt Times New Roman, Times, Serif; text-align: right"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">688</FONT></TD><TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;Add:</FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Amortization
    of intangible assets</FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">30</FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">16</FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">63</FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Stock
    based compensation</FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">34</FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">41</FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">130</FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left; padding-bottom: 1.5pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Depreciation</FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">47</FONT></TD><TD STYLE="padding-bottom: 1.5pt; font: 10pt Times New Roman, Times, Serif; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">35</FONT></TD><TD STYLE="padding-bottom: 1.5pt; font: 10pt Times New Roman, Times, Serif; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">142</FONT></TD><TD STYLE="padding-bottom: 1.5pt; font: 10pt Times New Roman, Times, Serif; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left; padding-bottom: 4pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">EBITDA</FONT></TD><TD STYLE="border-bottom: Black 4pt double; font: 10pt Times New Roman, Times, Serif; text-align: right"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 4pt double; font: 10pt Times New Roman, Times, Serif; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">$</FONT></TD><TD STYLE="border-bottom: Black 4pt double; font: 10pt Times New Roman, Times, Serif; text-align: right"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">413</FONT></TD><TD STYLE="padding-bottom: 4pt; font: bold 10pt Times New Roman, Times, Serif; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: bold 10pt Times New Roman, Times, Serif; padding-bottom: 4pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 4pt double; font: 10pt Times New Roman, Times, Serif; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">$</FONT></TD><TD STYLE="border-bottom: Black 4pt double; font: 10pt Times New Roman, Times, Serif; text-align: right"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">192</FONT></TD><TD STYLE="padding-bottom: 4pt; font: bold 10pt Times New Roman, Times, Serif; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 4pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 4pt double; font: 10pt Times New Roman, Times, Serif; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">$</FONT></TD><TD STYLE="border-bottom: Black 4pt double; font: 10pt Times New Roman, Times, Serif; text-align: right"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">1,023</FONT></TD><TD STYLE="padding-bottom: 4pt; font: 10pt Times New Roman, Times, Serif; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD></TR>
</TABLE>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>SEGMENT
INFORMATION</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(U.S.
dollars in thousands)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center; text-indent: 0.5in"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B></B></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>RFID
and Mobile Solutions</B></FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Supply<BR>

    Chain Solutions</B></FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Intercompany</B></FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Consolidated </B></FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>RFID
and Mobile Solutions</B></FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Supply<BR>
</B> <B>Chain Solutions</B></FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; padding-bottom: 1.5pt"></TD>
    <TD COLSPAN="2" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Intercompany</B></FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Consolidated </B></FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="14" STYLE="font-size: 10pt; border-bottom: Black 1.5pt solid"><P STYLE="font: 10pt/12pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>Three
months ended March 31,</B>&nbsp;<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>2016</B></FONT></P>


</TD><TD STYLE="font-size: 10pt; padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="14" STYLE="font-size: 10pt; border-bottom: Black 1.5pt solid"><P STYLE="font: 10pt/12pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>Three months ended March 31,</B>&nbsp;<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>2015</B></FONT></P>


</TD><TD STYLE="font-size: 10pt; padding-bottom: 1.5pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 10%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 1%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 1%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 1%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 1%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 1%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 1%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 1%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 1%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">Revenues</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">3,450</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">4,618</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">)</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">8,067</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">2,230</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">3,597</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;-</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">5,827</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">Gross profit</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">812</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">739</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">-</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">1,551</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">589</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">598</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">-</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">1,187</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; text-align: center">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 58%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt; text-align: center">&nbsp;</TD><TD STYLE="font: bold 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font: bold 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1.5pt solid">RFID and Mobile Solutions</TD><TD STYLE="padding-bottom: 1.5pt; font: bold 10pt Times New Roman, Times, Serif">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Supply<BR>

    Chain Solutions</B></FONT></TD><TD STYLE="padding-bottom: 1.5pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Intercompany</B></FONT></TD><TD STYLE="padding-bottom: 1.5pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Consolidated </B></FONT></TD><TD STYLE="padding-bottom: 1.5pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    </TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="font: bold 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="14" STYLE="font: bold 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1.5pt solid">year ended December 31,&nbsp;2015</TD><TD STYLE="font: bold 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt">&nbsp;</TD>
    </TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="14" STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    </TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 10%; font: 10pt Times New Roman, Times, Serif; text-align: left">Revenues</TD><TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="width: 9%; font: 10pt Times New Roman, Times, Serif; text-align: right">9,270</TD><TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="width: 9%; font: 10pt Times New Roman, Times, Serif; text-align: right">16,336</TD><TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="width: 9%; font: 10pt Times New Roman, Times, Serif; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(7</TD><TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif; text-align: left">)</TD><TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="width: 9%; font: 10pt Times New Roman, Times, Serif; text-align: right">25,599</TD><TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD>
    </TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD>
    </TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">Gross profit</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">2,608</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">2,529</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;-</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">5,137</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD>
    </TR>
</TABLE>


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<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin-top: 0; text-align: center; margin-bottom: 0">7</P>

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