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                                                                     Exhibit 3.2

                                     BYLAWS

                                       OF

                              NEOWARE SYSTEMS, INC.


                                   ARTICLE ONE

                                  STOCKHOLDERS

         SECTION 1.1 Annual Meetings. An annual meeting of stockholders to elect
directors and transact such other business as may properly be presented to the
meeting shall be held on such date and at such place as the Board of Directors
may from time to time fix, and if that day shall be a legal holiday in the
jurisdiction in which the meeting is to be held, then on the next day not a
legal holiday or as soon thereafter as may be practical as determined by the
Board of Directors.

         SECTION 1.2 Special Meetings. A special meeting of stockholders may be
called at any time by the Chairman of the Board, by the Board of Directors
pursuant to a resolution adopted by a majority of the Whole Board (as defined
below) or by the Secretary at the direction of a majority of the voting power of
all the then outstanding shares of the voting stock, voting together as a single
class upon receipt of a written request to do so specifying the matter or
matters, appropriate for action at such a meeting. Any such meeting shall be
held at such time and at such place, within or without the State of Delaware, as
shall be determined by the body or person calling such meeting and as shall be
stated in the notice of such meeting. The Whole Board shall mean the total
number of directors which the Corporation would have if there were no vacancies.

         SECTION 1.3 Notice of Meeting. For each meeting of stockholders written
notice shall be given stating the place, date and hour and, in the case of a
special meeting, the purpose or purposes for which the meeting is called and, if
the list of stockholders required by Section 1.9 is not to be at such place at
least 10 days prior to the meeting, the place where such list will be. Except as
otherwise provided by Delaware law, written notice of any meeting shall be given
not less than 10 or more than 60 days before the date of the meeting to each
stockholder entitled to vote at such meeting. If mailed, notice shall be deemed
to be given when deposited in United States mail, postage prepaid, directed to
stockholder at his address as it appears on the records of the Corporation.

         SECTION 1.4 Quorum. Except as otherwise required by Delaware law or the
Certificate of Incorporation, the holders of record of a majority of the shares
of stock entitled to be voted present in person or represented by proxy at a
meeting shall constitute a quorum for the transaction of business at the
meeting, but in the absence of a quorum the holders of record present or
represented by proxy at such meeting may vote to adjourn the meeting from time
to time, without notice other than announcement at the meeting, until a quorum
is obtained. At any such adjourned session of the meeting at which there shall
be present or represented the holders of record of the requisite number of
shares, any business 'nay be transacted that might have been transacted at the
meeting as originally called.

         SECTION 1.5 Chairman and Secretary at Meeting. At each meeting of
stockholders the President, or in his absence the person designated in writing
by the President, or if no person is designated, then a person designated by the
Board of Directors, shall preside as chairman of the meeting; if no person is so
designated, then the meeting shall choose a chairman by plurality vote. The
Secretary, or in his absence a person designated by the chairman of the meeting,
shall act as secretary of the meeting.


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         SECTION 1.6 Voting; Proxies. Except as otherwise provided by Delaware
law or the Certificate of Incorporation, and subject to the provisions of
Section 1.10:

                  (a) Each stockholder shall at every meeting of the
stockholders be entitled to one vote for each share of capital stock held by
him.

                  (b) Each stockholder entitled to vote at a meeting of
stockholders or to express consent or dissent to corporate action in writing
without a meeting may authorize another person or persons to act for him by
proxy, but no such proxy shall be voted or acted upon after three years from its
date, unless the proxy provides for a longer period.

                  (c) Directors shall be elected by a plurality vote.

                  (d) Each matter, other than election of directors, properly
presented to any meeting shall be decided by a majority of the votes cast on the
matter.

                  (e) Election of directors and the vote on any other matter
presented to a meeting shall be by written ballot only if so ordered by the
chairman of the meeting or if so requested by any stockholder present or
represented by proxy at the meeting entitled to vote in such election or on such
matter, as the case may be.

         SECTION 1.7 Adjourned Meetings. A meeting of stockholders may be
adjourned to another time or place as provided in Section 1.4 or 1.6(d). Unless
the Board of Directors fixes a new record date, stockholders of record for an
adjourned meeting shall be as originally determined for the meeting from which
the adjournment was taken. If the adjournment is for more than 30 days, or if
after the adjournment a new record date is fixed for the adjourned meeting, a
notice of the adjourned meeting shall be given to each stockholder of record
entitled to vote. At the adjourned meeting any business may be transacted that
might have been transacted at the meeting as originally called.

         SECTION 1.8 Consent of Stockholders in Lieu of Meeting. Any action that
may be taken at any annual or special meeting of stockholders may be taken
without a meeting, without prior notice and without a vote, if a consent in
writing, setting forth the action so taken, shall be signed by the holders of
outstanding stock having not less than the minimum number of votes that would be
necessary to authorize or take such action at a meeting at which all shares
entitled to vote thereon were present and voted. Notice of the taking of such
action shall be given promptly to each stockholder that would have been entitled
to vote thereon at a meeting of stockholders and that did not consent thereto in
writing.

         SECTION 1.9 List of Stockholders Entitled to Vote. At least 10 days
before every meeting of stockholders a complete list of the stockholders
entitled to vote at the meeting, arranged in alphabetical order and showing the
address of each stockholder and the number of shares registered in the name of
each stockholder, shall be prepared and shall be open to the examination of any
stockholder for any purpose germane to the meeting, during ordinary business
hours, for a period of at least 10 days prior to the meeting, at a place within
the city where the meeting is to be held. Such list shall be produced and kept
at the time and place of the meeting during the whole time thereof and may be
inspected by any stockholder who is present.


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         SECTION 1.10 Fixing of Record Date. In order that the Corporation may
determine the stockholders entitled to notice of or to vote at any meeting of
stockholders or any adjournment thereof, or to express consent to corporate
action in writing without a meeting, or entitled to receive payment of any
dividend or other distribution or allotment of any rights, or entitled to
exercise any rights in respect of any change, conversion or exchange of stock or
for the purpose of any other lawful action, the Board of Directors may fix, in
advance, a record date, which shall not be more than 60 or less than 10 days
before the date of such meeting, nor more than 60 days prior to any other
action. If no record date is fixed, the record date for determining stockholders
entitled to notice of or to vote at a meeting of stockholders shall be at the
close of business on the day next preceding the day on which notice is given,
or, if notice is waived, at the close of business on the day next preceding the
day on which the meeting is held; the record date for determining stockholders
entitled to express consent to corporate action in writing without a meeting,
when no prior action by the Board of Directors is necessary, shall be the day on
which the first written consent is expressed; and the record date for any other
purpose shall be at the close of business on the day on which the Board of
Directors adopts the resolution relating thereto.

         SECTION 1.11 Stockholder Proposals. Nominations by stockholders of
persons for election to the Board of Directors of the Corporation may be made at
an annual meeting in compliance with Section 2.12 hereof. To be properly brought
before an annual meeting, all other business must: (a) have been specified in
the written notice of the annual meeting (or any supplement thereto) given by
the Corporation; (b) be brought before the annual meeting at the direction of
the Board of Directors; or (c) have been specified in a written notice (a
"Stockholder Notice") given to the Corporation, in accordance with all of the
following requirements, by or on behalf of any stockholder of the Corporation.
Each Stockholder Notice must be delivered personally to, or be mailed to and
received by, the Corporation, addressed to the attention of the Secretary at the
principal executive offices of the Corporation no later than the close of
business on the date that is forty-five (45) days before the date on which the
Corporation first mailed its proxy materials for the prior year's annual meeting
of stockholders (or, if during the prior year, the Corporation did not hold an
annual meeting of stockholders, or if the date of the annual meeting of
stockholders has changed more than thirty (30) days from the prior year, then
the Stockholder Notice must be received a reasonable time before the Corporation
mails its proxy materials for the current year). Each Stockholder Notice shall
set forth a general description of each item of business proposed to be brought
before the annual meeting of stockholders, the name and address of the
stockholder proposing to bring such item of business before the meeting, the
number of shares of the Corporation which are beneficially owned by the
stockholder, and any material interest of the stockholder in such business.


                                   ARTICLE TWO

                                    DIRECTORS

         SECTION 2.1 Number; Term of Office; Qualifications; Vacancies. The
number of directors that shall constitute the whole Board of Directors shall be
five, which number may be changed from time to time as determined by action of
the Board of Directors taken by the affirmative vote of a majority of the whole
Board of Directors. Directors shall be elected at the annual meeting of
stockholders to hold office, subject to Sections 2.2 and 2.3, until the next
annual meeting of stockholders and until their respective successors are elected
and qualified. Vacancies and newly created directorships resulting from any
increase in the authorized number of directors may be filled by a majority of
the directors then in office, although less than a quorum, or by the sole
remaining director, and the directors so chosen shall hold office, subject to
Sections 2.2 and 2.3, until the next annual meeting of stockholders and until
their respective successors are elected and qualified.



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         SECTION 2.2 Resignation. Any director of the Corporation may resign at
any time by giving written notice of such resignation to the Board of Directors,
the President or the Secretary of the Corporation. Any such resignation shall
take effect at the time specified therein or, if no time be specified, upon
receipt thereof by the Board of Directors or one of the above-named officers;
and, unless specified therein, the acceptance of such resignation shall not be
necessary to make it effective. When one or more directors shall resign from the
Board of Directors effective at a future date, a majority of the directors then
in office, including those who have so resigned, shall have power to fill such
vacancy or vacancies, the vote thereon to take effect when such resignation or
resignations shall become effective, and each director so chosen shall hold
office as provided in these Bylaws in the filling of other vacancies.

         SECTION 2.3 Removal. Any one or more directors may be removed, with or
without cause, by the vote or written consent of the holders of a majority of
the shares entitled to vote at an election of directors, or by the Board of
Directors.

         SECTION 2.4 Regular and Annual Meetings; Notice. Regular meetings of
the Board of Directors shall be held at such time and at such place, within or
without the State of Delaware, as the Board of Directors may from time to time
prescribe. No notice need be given of any regular meeting, and a notice, if
given, need not specify the purposes thereof. A meeting of the Board of
Directors may be held without notice immediately after an annual meeting of
stockholders at the same place as that at which such meeting was held.

         SECTION 2.5 Special Meetings; Notice. A special meeting of the Board of
Directors may be called at any time by the Board of Directors, its Chairman, the
Executive Committee, the President or any person acting in the place of the
President and shall be called by any one of them or by the Secretary upon
receipt of a written request to do so specifying the matter or matters,
appropriate for action at such a meeting, proposed to be presented at the
meeting and signed by at least two directors. Any such meeting shall be held at
such time and at such place, within or without the State of Delaware, as shall
be determined by the body or person calling such meeting. Notice of such meeting
stating the time and place thereof shall be given (a) by deposit of the notice
in the United States mail, first class, postage prepaid, at least two days
before the day fixed for the meeting addressed to each director at his address
as it appears on the Corporation's records or at such other address as the
director may have furnished the Corporation for that purpose, or (b) by delivery
of the notice similarly addressed for dispatch by telegraph, cable or radio or
by delivery of notice by telephone or in person, in each case at least 24 hours
before the time fixed for the meeting.

         SECTION 2.6 Chairman of the Board; Presiding Officer and Secretary at
Meetings. The Board of Directors may elect one of its members to serve at its
pleasure as Chairman of the Board. Each meeting of the Board of Directors shall
be presided over by the Chairman of the Board or in his absence by the
President, if a director, or if neither is present by such member of the Board
of Directors as shall be chosen at the meeting. The Secretary, or in his absence
an Assistant Secretary, shall act as secretary of the meeting, or if no such
officer is present, a secretary of the meeting shall be designated by the person
presiding over the meeting.

         SECTION 2.7 Quorum. A majority of the whole Board of Directors shall
constitute a quorum for the transaction of business, but in the absence of a
quorum a majority of those present (or if only one be present, then that one)
may adjourn the meeting, without notice other than announcement at the meeting,
until such time as a quorum is present. Except as otherwise required by the
Certificate of Incorporation or the Bylaws, the vote of the majority of the
directors present at a meeting at which a quorum is present shall be the act of
the Board of Directors.



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         SECTION 2.8 Meeting by Telephone. Members of the Board of Directors or
any committee thereof may participate in meetings of the Board of Directors or
of such committee by means of conference telephone or similar communications
equipment by means of which all persons participating in the meeting can hear
each other, and such participation shall constitute presence in person at such
meeting.

         SECTION 2.9 Action Without Meeting. Unless otherwise restricted by the
Certificate of Incorporation, any action required or permitted to be taken at
any meeting of the Board of Directors or of any committee thereof may be taken
without a meeting if all members of the Board of Directors or of such committee,
as the case may be, consent thereto in writing and the writing or writings are
filed with the minutes of proceedings of the Board of Directors or of such
committee.

         SECTION 2.10 Executive and Other Committees. The Board of Directors
may, by resolution passed by a majority of the whole Board of Directors,
designate an Executive Committee and one or more other committees, each such
committee to consist of one or more directors as the Board of Directors may from
time to time determine. Any such committee, to the extent provided in such
resolution or resolutions, shall have and may exercise all the powers and
authority of the Board of Directors in the management of the business and
affairs of the Corporation, including the power to authorize the seal of the
Corporation to be affixed to all papers that may require it but no such
committee shall have such power of authority in reference to amending the
Certificate of Incorporation, adopting an agreement of merger or consolidation,
recommending to the stockholders the sale, lease or exchange of all or
substantially all of the Corporation's property and assets, recommending to the
stockholders a dissolution of the Corporation or a revocation of a dissolution,
or amending the Bylaws; and unless the resolution shall expressly so provide, no
such committee shall have the power or authority to declare a dividend or to
authorize the issuance of stock. In the absence or disqualification of a member
of a committee, the member or members thereof present at any meeting and not
disqualified from voting, whether or not he or they constitute a quorum, may
unanimously appoint another member of the Board of Directors to act at the
meeting in place of any such absent or disqualified member. Each such committee
other than the Executive Committee shall have such name as may be determined
from time to time by the Board of Directors.

         SECTION 2.11 Compensation. Directors shall receive such compensation,
including fees and expenses, for their services as directors or as members of a
committee of the Board of Directors as shall be determined by a majority of the
entire Board.

         SECTION 2.12 Nomination of Directors. Nominations for the election of
directors may be made by the Board of Directors or a committee appointed by the
Board of Directors or by any stockholder of record entitled to vote in the
election of directors generally at the record date of the Meeting who complies
with the notice procedures set forth in this Section 2.12 may nominate one or
more persons for election as directors at a meeting only if written notice of
such stockholder's intention to make such nomination or nominations has been
delivered personally to, or been mailed to and received by the Corporation at
the principal executive offices of the Corporation addressed to the attention of
the Secretary, no later than the close of business on the date that is
forty-five (45) days before the date on which the Corporation first mailed its
proxy materials for the prior year's annual meeting of stockholders (or, if
during the prior year the Corporation did not hold an annual meeting of
stockholders or if the date of the meeting has been changed more than thirty
(30) days from the prior year, the notice must have been received a reasonable
time before the Corporation mails its proxy materials for the current year).
Each such notice shall set forth: (a) the name and address of the stockholder
intending to make the nomination and of the person or persons to be nominated;
(b) a representation that the stockholder intends to appear in person or by
proxy at the annual meeting of stockholders to nominate the person or person or
persons specified in the notice; (c) the address and principal occupation for
the past five (5) years of each nominee and such other information regarding
each nominee as would have been required to be included in a proxy statement
filed pursuant to Regulation 14A promulgated under the Securities Exchange Act
of 1934, as amended, had proxies been solicited with respect to such nominee by
management of the Corporation; and (d) the written consent of each nominee to
serve as a director of the Corporation if so elected. The presiding officer of
the Meeting may declare invalid any nomination not made in com7pliance with the
foregoing procedure.

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                                  ARTICLE THREE

                                    OFFICERS

         SECTION 3.1 Election; Qualification. The officers of the Corporation
shall be a Chairman of the Board, President, one or more Vice Presidents, a
Secretary and a Treasurer, each of whom shall be selected by the Board of
Directors. The Board of Directors may elect a Controller, one or more Assistant
Secretaries, one or more Assistant Treasurers, one or more Assistant Controllers
and such other officers as it may from time to time determine. Two or more
offices may be held by the same person.

         SECTION 3.2 Term of Office. Each officer shall hold office from the
time of his election and qualification to the time at which his successor is
elected and qualified, unless he shall die or resign or shall be removed
pursuant to Section 3.4 at any time sooner.

         SECTION 3.3 Resignation. Any officer of the Corporation may resign at
any time by giving written notice of such resignation to the Board of Directors,
the President or the Secretary of the Corporation. Any such resignation shall
take effect at the time specified therein or, if no time be specified, upon
receipt thereof by the Board of Directors or one of the above-named officers;
and, unless specified therein, the acceptance of such resignation shall not be
necessary to make it effective.

         SECTION 3.4 Removal. Any officer may be removed at any time, with or
without cause, by the vote of a majority of the Whole Board.

         SECTION 3.5 Vacancies. Any vacancy however caused in any office of the
Corporation may be filled by the Board of Directors.

         SECTION 3.6 Compensation. The compensation of each officer shall be
such as the Board of Directors may from time to time determine.

         SECTION 3.7 Chairman of the Board. The Chairman of the Board shall be
the chairman of all meetings of the Board of Directors.

         SECTION 3.8 President. The President shall be the chief executive
officer of the Corporation and shall have general charge of the business and
affairs of the Corporation, subject however to the right of the Board of
Directors to confer specified powers on officers and subject generally to the
direction of the Board of Directors and the Executive Committee, if any.

         SECTION 3.9 Vice President. Each Vice President shall have such powers
and duties as generally pertain to the office of Vice President and as the Board
of Directors or the President may from time to time prescribe. During the
absence of the President or his inability to act, the Vice President, or if
there shall be more than one Vice President, then that one designated by the
Board of Directors, shall exercise the powers and shall perform the duties of
the President, subject to the direction of the Board of Directors and the
Executive Committee, if any.

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         SECTION 3.10 Secretary. The Secretary shall keep the minutes of all
meetings of stockholders and of the Board of Directors. He shall be custodian of
the corporate seal and shall affix it or cause it to be affixed to such
instruments as require such seal and attest the same and shall exercise the
powers and shall perform the duties incident to the office of Secretary, subject
to the direction of the Board of Directors and the Executive Committee, if any.

         SECTION 3.11 Other Officers. Each other officer of the Corporation
shall exercise the powers and shall perform the duties incident to his office,
subject to the direction of the Board of Directors and the Executive Committee,
if any.

                                  ARTICLE FOUR

                                  CAPITAL STOCK

         SECTION 4.1 Stock Certificates. The interest of each holder of stock of
the Corporation shall be evidenced by a certificate or certificates in such form
as the Board of Directors may from time to time prescribe. Each certificate
shall be signed by or in the name of the Corporation by the President or a Vice
President and by the Treasurer or an Assistant Treasurer or the Secretary or an
Assistant Secretary. Any or all the signatures appearing on such certificate or
certificates may be a facsimile. If any officer, transfer agent or registrar who
has signed or whose facsimile signature has been placed upon a certificate shall
have ceased to be such officer, transfer agent or registrar before such
certificate is issued, it may be issued by the Corporation with the same effect
as if he were such officer, transfer agent or registrar at the date of issue.

         SECTION 4.2 Transfer of Stock. Shares of stock shall be transferable on
the books of the Corporation pursuant to applicable law and such rules and
regulations as the Board of Directors shall from time to time prescribe.

         SECTION 4.3 Holders of Record. Prior to due presentment for
registration of transfer the Corporation may treat the holder of record of a
share of its stock as the complete owner thereof exclusively entitled to vote,
to receive notifications and otherwise entitled to all rights and powers of a
complete owner thereof, notwithstanding notice to the contrary.

         SECTION 4.4 Lost, Stolen, Destroyed or Mutilated Certificates. The
Corporation shall issue a new certificate of stock to replace a certificate
theretofore issued by it alleged to have been lost, destroyed or wrongfully
taken, if the owner or his legal representative (i) requests replacement, before
the Corporation has notice that the stock certificate has been acquired by a
bona fide purchaser; (ii) files with the Corporation a bond sufficient to
indemnify the Corporation against any loss or destruction of any such stock
certificate or the issuance of any such new stock certificate; and (iii)
satisfies such other terms and conditions as the Board of Directors may from
time to time prescribe.



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                                  ARTICLE FIVE

                                  MISCELLANEOUS

         SECTION 5.1       Indemnity.

                  (a) Each person who was or is made a party or is threatened to
be made a party to or is involved in any action, suit, or proceeding, whether
civil, criminal, administrative or investigative (hereinafter a "proceeding"),
by reason of the fact that he or she or a person of whom he or she is the legal
representative is or was a director, officer, employee or agent of the
Corporation or is or was serving at the request of the Corporation, as a
director, officer or employee or agent of another corporation or of a
partnership, joint venture, trust or other enterprise, including service with
respect to employee benefit plans, whether the basis of such proceeding is
alleged action in an official capacity as a director, officer, employee or agent
or in any other capacity while serving as a director, officer, employee or
agent, shall be indemnified and held harmless by the Corporation to the fullest
extent authorized by the Delaware General Corporation Law as the same exists or
may hereafter be amended (but, in the case of any such amendment, only to the
extent that such amendment permits the Corporation to provide broader
indemnification rights than said law permitted the Corporation to provide prior
to such amendment) and in the manner provided in the Certificate of
Incorporation of the Corporation and as otherwise permitted by the Delaware
General Corporation Law.

         SECTION 5.2 Waiver of Notice. Whenever notice is required by the
Certificate of Incorporation, the Bylaws or any provision of the Delaware
General Corporation Law, a written waiver thereof, signed by the person entitled
to notice, whether before or after the time required for such notice, shall be
deemed equivalent to notice. Attendance of a person at a meeting shall
constitute a waiver of notice of such meeting, except when the person attends a
meeting for the express purpose of objecting, at the beginning of the meeting,
to the transaction of any business because the meeting is not lawfully called or
convened. Neither the business to be transacted at, nor the purpose of, any
regular or special meeting of the stockholders, directors or members of a
committee of directors need be specified in any written waiver or notice.

         SECTION 5.3 Fiscal Year. The fiscal year of the Corporation shall start
on such date as the Board of Directors shall from time to time prescribe.

         SECTION 5.4 Corporate Seal. The corporate seal shall be in such form as
the Board of Directors may from time to time prescribe, and the same may be used
by causing it or a facsimile thereof to be impressed or affixed or in any other
manner reproduced.

                                   ARTICLE SIX

                               AMENDMENT OF BYLAWS

         SECTION 6.1 Amendment. The Bylaws may be altered, amended or repealed
by the stockholders or by the Board of Directors by a majority vote.



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