B.O.S. Better On-line Solutions Ltd. Announces Reorganization.

Business Editors

TERADYON, Israel--(BUSINESS WIRE)--Dec. 10, 2001

B.O.S. Better On-line Solutions Ltd. (the "Company" or "BOS") (NASDAQ:BOSC) announced today its plans to reorganize the structure of the company.

Under the new structure, which will take effect at the beginning of 2002, BOS' current activities will become the responsibility and focus of a newly established, wholly-owned Israeli subsidiary named BOSCOM. The new company will be engaged in developing, marketing, manufacturing, selling, and servicing BOS' products. Once the reorganization is complete, BOS will become the parent company of BOSCOM, Pacific Information Systems, and will hold BOS' investment in Surf Communication Solutions.

Under the new reorganization, Mr. Moti Weiss, one of BOS' directors, will serve as BOS' CEO, Mr. Israel Gal will serve as President, and Mr. Eyran Noy will serve as CFO. In addition, Mr. Israel Gal has been appointed as the President and CEO of BOSCOM.

Mr. Eyran Noy, 46, joined BOS in November 2001. From 2000 through 2001 Mr. Noy served as CEO of Isralaser Ltd., an Israel-based company, and from 1993 through 2000 he held various positions with Indigo NV's finance department, most recently as Corporate Director of Finance. Mr. Noy holds an MBA degree from Tel Aviv University.

Finalization of the reorganization is subject to obtaining certain governmental approvals. The Company does not foresee any difficulties in achieving such approvals.

"Under the new corporate policy, BOS intends to use its available resources and cash to seek new acquisitions with a clear purpose to increase its value significantly for shareholders," stated Moti Weiss.

About BOS - Better On-Line Solutions

BOS specializes in delivering solutions optimized for small and medium enterprises, and click-to-talk capability for Web sites and call centers, through its IP Telephony products. The Company also develops, produces and markets solutions for IBM mid-range-to-PC and LAN connectivity, including Internet/intranet, emulation gateways, and GUI, as well as printing solutions that are operating-system independent.

Pacinfo, a fully owned subsidiary, is an award-winning commercial VAR and e-commerce system solutions provider selling a wide range of network related products, and specializing in enterprise IT solutions.

Surf Communication Solutions, an affiliated company, develops and supplies software-based access solutions that are integrated into manufacturers' original equipment in the telecommunications, data communications, telephony and consumer electronics industries.

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, including, but not limited to, those risks and uncertainties detailed in BOS' periodic reports and registration statements filed with the U.S. Securities Exchange Commission.