Exhibit 1.1

This is an English translation from the
original Hebrew version. In case of any 
discrepancy, the binding version is the Hebrew original.

Articles
of Association of

Elron Electronic Industries Ltd.

INTRODUCTION

|   |     |                                                             
|-- | --- | ------------------------------------------------------------
|1. | 1.1 | In these
  Articles, unless the context otherwise requires -

| |                                       |  |                                                                                                                                                                                                                                                                    
| | ------------------------------------- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Person or Persons -               |  | Including a
  corporation;                                                                                                                                                                                                                                         
| |                                       |  |                                                                                                                                                                                                                                                                    
| | Shareholders meeting -              |  | General
  meeting of all the shareholders of the Company;                                                                                                                                                                                                          
| |                                       |  |                                                                                                                                                                                                                                                                    
| | In writing-                         |  | In
  handwriting, print, type, photo, telex, facsimile, e-mail, computer or
  through any other electronic media, which creates or enables the creation of
  a copy and/or printout of the document;                                                               
| |                                       |  |                                                                                                                                                                                                                                                                    
| | Shareholder -                       |  | A Registered
  Shareholder and a Non-Registered Shareholder;                                                                                                                                                                                                       
| |                                       |  |                                                                                                                                                                                                                                                                    
| | Law                                 |  | The
  provisions of any law prevailing in the State of Israel;                                                                                                                                                                                                     
| |                                       |  |                                                                                                                                                                                                                                                                    
| | Registered Shareholder -            |  | A
  shareholder registered in the Shareholders Register of the Company;                                                                                                                                                                                            
| |                                       |  |                                                                                                                                                                                                                                                                    
| | Non-Registered 
  Shareholder -     |  | Any person
  to whose credit a share is registered with a member of the Stock Exchange (as
  defined in the Companies Law) and such share is included among the shares
  registered in the Shareholders Register of the Company in the name of a
  Nominee Company;
| |                                       |  |                                                                                                                                                                                                                                                                    
| | The Company -                       |  | Elron
  Electronic Industries Ltd.;                                                                                                                                                                                                                                
| |                                       |  |                                                                                                                                                                                                                                                                    
| | The Board -                         |  | The Board of
  Directors of the company, including every committee of the Board acting
  within the framework of authorities empowered to it lawfully by the Board.                                                                                                
| |                                       |  |                                                                                                                                                                                                                                                                    
| | The Law or 
  The Companies Law - |  | The
  Companies Law, 5759-1999, and the Regulations enacted thereunder, as from
  time to time in force;                                                                                                                                                           

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| |                                                   |  |                                                                                                                                                                                                                                                          
| | ------------------------------------------------- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | The
  Secretary -                               |  | Whoever may
  be appointed as secretary of the Company;                                                                                                                                                                                                  
| |                                                   |  |                                                                                                                                                                                                                                                          
| | The General Manager -                           |  | The General
  Manager of the Company;                                                                                                                                                                                                                    
| |                                                   |  |                                                                                                                                                                                                                                                          
| | The Register or
  The Shareholders Register - |  | The register
  of shareholders of the Company which must be maintained by law;                                                                                                                                                                           
| |                                                   |  |                                                                                                                                                                                                                                                          
| | The Office or
  The Registered Office-        |  | The office
  of the Company, the address of which is from time to time registered with the
  Register of Companies;                                                                                                                                      
| |                                                   |  |                                                                                                                                                                                                                                                          
| | The Ordinance or
  The Companies Ordinance-   |  | The
  Companies Ordinance (New Version), 5743-1983, and the Regulations enacted
  thereunder, as from time to time in force;                                                                                                                             
| |                                                   |  |                                                                                                                                                                                                                                                          
| | Share -                                         |  | A share of
  the Company;                                                                                                                                                                                                                                
| |                                                   |  |                                                                                                                                                                                                                                                          
| | Special Majority-                               |  | A majority
  of at least sixty seven percent of all votes of the shareholders present at a
  general meeting or class meeting, as the case may be, who are entitled to
  vote and who voted at such meeting, without taking abstentions into account;    
| |                                                   |  |                                                                                                                                                                                                                                                          
| | Ordinary Majority -                             |  | A simple
  majority of more than fifty percent of all votes of the shareholders present
  at a general meeting or class meeting, as the case may be, who are entitled
  to vote and who voted at such meeting, without taking abstentions into
  account;
| |                                                   |  |                                                                                                                                                                                                                                                          
| | Year or Month -                               |  | In
  accordance with the Gregorian calendar;                                                                                                                                                                                                             
| |                                                   |  |                                                                                                                                                                                                                                                          
| | Corporation-                                    |  | A company,
  partnership, cooperative society, association and any other body of persons
  whether incorporated or unincorporated;                                                                                                                       
| |                                                   |  |                                                                                                                                                                                                                                                          
| | These
  Articles or
  The Articles -          |  | The Articles
  of Association set forth in this document, as may from time to time be
  amended;                                                                                                                                                         

| |     |                                                                                                                                                                  
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------
| | 1.2 | Any
  expression in these Articles which is not defined in Article 1.1 above, shall
  have the meaning assigned to it in the Companies Law, unless this may be in

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| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                  
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| |     | contradiction
  to the subject matter or its content. Words in the singular shall mean also
  the plural, and vice versa, words in masculine gender shall mean also
  feminine gender.                                                                                                                                                                                                                                           
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | 1.3 | The headings
  in these Articles are meant for the purpose of convenience only and shall not
  be used for the interpretation of these Articles.                                                                                                                                                                                                                                                                                 
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | 1.4 | In any place
  in these Articles which provides that the provisions thereof shall apply
  subject to the provisions of the Ordinance and/or subject to the provisions
  of the Companies Law and/or subject to the provisions of any law, the
  intention is to provisions of the Ordinance and/or provisions of the
  Companies Law and/or provisions of any law which are not elective, unless the
  context otherwise demands.
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | 1.5 | Provisions
  of the Companies Law which are dispositive shall apply to the Company, to the
  extent that it is not otherwise provided in these Articles and to the extent
  that there is no contradiction between them and between the provisions of
  these Articles.                                                                                                                                                          

Name
of the Company

|                        |                                                                                                                                                                                                                                                                                                                             |                                                  
|----------------------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------
|                        |                                                                                                                                                                                                                                                                                                                             |                                                  
|2.                      | The name of
  the Company is as follows:                                                                                                                                                                                                                                                                                   
|                        |                                                                                                                                                                                                                                                                                                                            
|                        | 2.1.                                                                                                                                                                                                                                                                                                                        | In Hebrew  (COMPANY NAME)                       
|                        |                                                                                                                                                                                                                                                                                                                             |                                                  
|                        | 2.2.                                                                                                                                                                                                                                                                                                                        | In English 
  Elron Electronic Industries Ltd.
|                        |                                                                                                                                                                                                                                                                                                                             |                                                  
|Limitation of Liability
|                       
|3.                      | The
  liability of the shareholders is limited, each to payment of the full amount
  which he undertook to pay for the shares allotted to him at the time of the
  allotment.                                                                                                                                              
|                        |                                                                                                                                                                                                                                                                                                                            
|Objects of the Company 
|                       
|4.                      | The Company
  shall engage in any legal business.                                                                                                                                                                                                                                                                          
|                        |                                                                                                                                                                                                                                                                                                                            
|Business               
|                       
|5.                      | The Company
  may, at any time, engage in any branch or kind of business in which it is,
  expressly or by implication, authorized to engage in accordance with Article
  4 above. The Company may also cease to engage in such businesses, whether or
  not it has commenced to engage in such branch or kind of business.
|                        |                                                                                                                                                                                                                                                                                                                            
|Donations              
|                       
|6.                      | The Company
  may donate reasonable amounts for deserving causes, even though the donation
  is not within the framework of the business considerations of the Company.
  The                                                                                                                                              

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|                         |                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|------------------------ | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                         | Board, at
  its discretion, is authorized to determine the amounts of the donations, the
  causes for which they are made, the identity of the recipient of the donation
  and any other condition relating thereto.                                                                                                                                                       
|                         |                                                                                                                                                                                                                                                                                                                                                                            
|Registered Office       
|                        
|7.                       | The
  registered office of the Company shall be the address determined by the Board
  or by a person designated to it by the Board, as may from time to time be
  changed.                                                                                                                                                                                                 
|                         |                                                                                                                                                                                                                                                                                                                                                                            
|The Articles            
|                         |                                                                                                                                                                                                                                                                                                                                                                            
|8.                       | The Company
  may alter these Articles by resolution carried at a General Meeting by a
  Special Majority.                                                                                                                                                                                                                                                                 
|                         |                                                                                                                                                                                                                                                                                                                                                                            
|9.                       | A resolution
  carried at a General Meeting by the majority required for alteration of the
  Articles, as aforesaid in Article 8 above, which alters any provision of the
  provisions of these Articles, shall be deemed to constitute a resolution for
  the alteration of these Articles even though the resolution does not
  expressly state alteration of Articles.
|                         |                                                                                                                                                                                                                                                                                                                                                                            
|10.                      | Subject to
  the provisions of the Companies Law, alterations of these Articles shall be
  valid as from the date of adoption of the resolution by the Company or from
  such later date as may be determined in the resolution.                                                                                                                                           
|                         |                                                                                                                                                                                                                                                                                                                                                                            
|Registered Share Capital
|                        
|11.                      | The
  registered share capital of the Company is NIS 94,500 divided into 31,500,000
  Ordinary Shares of par value NIS 0.003 each (hereinafter - The
  Ordinary Shares). The Company may alter the registered share
  capital in accordance with the provisions of the Companies Law and of these
  Articles.                                                            
|                         |                                                                                                                                                                                                                                                                                                                                                                            
|The Shares              
|                        
|12.                      | The
  following rights shall be attached to the Ordinary Shares of the Company:                                                                                                                                                                                                                                                                                            
|                         |                                                                                                                                                                                                                                                                                                                                                                            
|                         | 12.1.                                                                                                                                                                                                                                                                                                                                                                       | The Ordinary
  Shares shall confer upon the holders thereof the right to receive from time
  to time, proportionately to the amounts of capital paid up or credited as
  paid up on such shares, all profits which will be distributed to all the
  shareholders of the Company, all profits and reserves which will be
  capitalized and distributed either in cash or in shares of the Company, to
  all the shareholders of the Company, and the return of capital and
  distribution of surplus of assets upon winding up of the Company.
|                         |                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|                         | 12.2.                                                                                                                                                                                                                                                                                                                                                                       | The Ordinary
  Shares shall confer upon the holders thereof the right to receive notices of
  and to participate in all General Meetings of the Company.                                                                                                                                                                                                                                                                                                                                                                                     
|                         |                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|                         | 12.3.                                                                                                                                                                                                                                                                                                                                                                       | The Ordinary
  Shares shall confer upon the holders thereof equal right to vote at the
  General Meetings of the Company.                                                                                                                                                                                                                                                                                                                                                                                                                    

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|                   | 12.4.                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | The
  provisions of these articles in respect of shares shall also apply to other
  securities issued by the Company, mutatis mutandis, unless expressly declared
  otherwise at the time of issue.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|13.                | The Board of
  Directors (hereinafter - the Board) may fix any record date it deems fit
  subject to the provisions of the Companies Law for the purpose determining
  the shareholders entitled to vote at a shareholders meeting, or to receive
  dividends or any rights issuance, or for any other lawful purpose. Had the
  Board fixed a record date for any such specific entitlement, the shareholders
  at such record date will be the only ones entitled thereto.
|                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|14.                | 14.1                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | A
  shareholder who is a trustee shall be registered in the Shareholders Register
  with a note as to his trusteeship, and for the purpose of the Companies Law
  he shall be deemed to be a shareholder. Without derogating from the
  aforesaid, the Company shall recognize a trustee, as aforesaid, as a
  shareholder, for all intents and purposes, and shall not recognize any other
  person whomsoever, including the beneficiary, as the owner of any right
  whatsoever to the share.                                                                                                                                                                                                                                                      
|                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                   | 14.2.                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | Without
  derogating from the aforesaid, and subject to the provisions of these
  Articles, apart from registered and non-registered shareholders of the
  Company, no person will be recognized by the Company as the owner of any
  right whatsoever to a share and the Company will not be bound and will not
  recognize any beneficial right in accordance with the laws of equity or
  trustee relations or a future or partial right to any share or any beneficial
  right in a fraction of a share or any other right in respect of a share, but
  only the right of the shareholder as aforesaid in Article 14.1 above to the
  share in its entirety, all the aforesaid except if a court of competent
  jurisdiction may otherwise direct.
|                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|Share Certificates
|                  
|15.                | The
  certificates evidencing the right of ownership to shares shall bear the stamp
  of the Company and the signatures of one Director together with the CEO of
  the Company or together with the secretary of the Company or the signatures
  of any two persons appointed by the Board for such purpose.                                                                                                                                                                  
|                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|                   | The Board
  may resolve that a signature or signatures as aforesaid may be effected by
  any mechanical means, as may be determined by the Board.                                                                                                                                                                                                                                                                                                                             
|                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|16.                | Except in
  the event that the conditions of the issuance of shares otherwise provide:                                                                                                                                                                                                                                                                                                                                                                                        
|                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|                   | 16.1.                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | Every
  registered shareholder is, at his request, entitled to receive from the
  Company within a period of two months following the allotment or the
  registration of transfer, as the case may be, one certificate evidencing his
  ownership of the shares registered in his name, or, with the consent of the
  Company, several such certificates.                                                                                                                                                                                                                                                                                                                                                                                             

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|-------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                     | 16.2.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | A Nominee
  Company is, at its request, entitled to receive from the Company within a
  period of two months following the allotment or the registration of transfer,
  as the case may be, one certificate evidencing the number of shares and class
  of shares registered in its name in the Shareholders Register.
|                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|17.                  | Subject to
  the provisions of the Companies Law, there shall be detailed in every
  certificate the number of shares in respect of which the certificate was
  issued, their serial numbers and par value.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|18.                  | A
  certificate which relates to a share registered in the name of two or more
  persons, shall be delivered to the person whose name appears first in the
  Shareholders Register in respect of such share, unless all the registered
  shareholders of such share shall direct the Company, in writing, to deliver
  the certificate to another of the registered shareholders.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|19.                  | If a share
  certificate is destroyed, spoiled, lost or damaged, the Board may order the
  cancellation thereof and the issue of a new certificate in place thereof,
  provided that the share certificate is delivered to the Company and destroyed
  by it, or that it is proved to the satisfaction of the Board that the
  certificate has been lost or destroyed and that the Company has received
  security to the satisfaction of the Board against any possible damage. A
  reasonable sum as may be determined by the Board from time to time shall be
  paid in respect of every certificate issued pursuant to this Article.                                                                                                                                                                                                                                                                              
|                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|Payments for Shares 
|                    
|20.                  | The
  consideration to be given to the Company for any issuance of shares as well
  as the time and manner of delivery thereof to the Company and all other
  conditions applying in connection therewith, if any, shall be determined by
  the Board, and the Board may determine the same at its discretion subject to
  the provisions of the Companies Law. In the event that the entire or part of
  the consideration for any share will not be given to the Company until the
  issuance thereof, such share may not be issued before the consideration
  therefor and the time and manner of delivery thereof to the Company, as
  determined by the Board, shall have been documented in writing, and the
  Company shall have received a written commitment thereto of the person to
  whom such share is to be issued.                                                                                     
|                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|Forfeiture of Shares
|                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|21.                  | The Board may
  resolve to forfeit a share issued by the Company if the consideration
  therefor which the shareholder has committed to deliver to the Company has
  not been delivered to the Company at the time and according to the conditions
  as committed to by such shareholder. Such resolution may not be adopted
  unless a written notice of the Companys intention to forfeit the share has
  been sent by the Company to the shareholder and the entire or any part of the
  consideration as should have been delivered to the Company prior to the date
  of such notice has not been delivered to the Company by the end of fourteen
  days from the date of such notice. The date of adoption of such resolution
  shall be deemed to be the date of forfeiture of such share, and thereafter
  the Company may sell such share at such date, in such manner and on such
  conditions as the Board

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|                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|------------------ | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                   | shall
  determine in its discretion. Subject to the foregoing, in all matters
  regarding such forfeiture of shares and sale thereof the provisions of the
  Companies Law in this respect shall also apply.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|Transfer of Shares
|                  
|22.                | Every
  transfer of shares registered in the Shareholders Register in the name of a
  registered shareholder, including by or to the Nominee Company, shall be made
  by a Deed of Transfer in the form usual in Israel or in such other form as
  may be approved by the Board or by the person/s designated by the Board for
  this purpose. The Deed of Transfer shall be signed in handwriting only by the
  transferor and by the transferee, in person or by their attorneys and also by
  witnesses to their signature.                                                                                                                                                                                                                                                                                      
|                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|23.                | Before the
  registration of transfer of shares in the Companys Registrer of
  Shareholders, the Deed of Transfer shall be lodged for registration at the
  registered office of the Company or any other place as may be fixed by the
  Board, or by the person/s designated by the Board for this purpose, together
  with the share certificates of the shares to be transferred, if such a
  certificate has been issued, and together with any other proof required by the
  Company as to the proprietary right of the transferor or his right to
  transfer the shares or the authority of the attorney for the transferor or
  the attorney for the transferee to sign behalf the name of the transferor or
  the transferee on the Deed of Transfer, if it was signed by an attorney as
  mentioned above.
|                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|24.                | The Company
  shall be entitled to charge a fee for registration of transfer in an amount
  to be fixed by the Board from time to time and which is reasonable in the
  circumstances of the matter.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|25.                | Subject to
  the provisions of the Companies Law, a transfer of shares will not be
  registered in the Register of Shareholders other than after the Transfer
  Deed, share certificate and proof required by the Company as aforesaid shall
  have been delivered to the Company, and the amount fixed, if any, for
  registration of the transfer has been paid to the Company; the transferor
  shall continue to be considered as the shareholder of the transferred shares
  until the registration of the transferee in the Register of Shareholders as
  the shareholder of such shares.                                                                                                                                                                                                                     
|                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|26.                | The Company
  may close the Shareholders Register for a period fixed by the Board provided
  that such period shall not exceed, in total, above thirty days in any year.
  When the Register is closed, no transfer of shares shall be registered in the
  Register.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|27.                | Subject to
  the provisions of these Articles or to the terms of the issue of shares of
  any class, any share that was fully paid may be transferred without necessity
  for approval by the Board.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|28.                | If the
  Company refuses to approve the transfer of shares, it shall notify the
  transferor of the same not later than one month from the date of receipt of
  the Deed of Transfer.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|29.                | A Deed of
  Transfer that shall be registered in the Companys Register of Shareholders
  shall be kept by the Company. Any Deed of Transfer which the Company refuses
  to                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         

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|------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                | register in the Register of Shareholders shall be returned to the
  person who submitted it, according to his/her demand.                                                                                                                                                                                                                                                                                                                                                                            
|                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|30.                             | 30.1                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | Subject to the provisions of the Companies Law and to the provisions
  of these Articles, if there shall be proved to the Company to its
  satisfaction in such manner as may be determined by it, the existence of the
  legal requirements for the transmission of shares registered in the name of a
  registered shareholder, the Company shall recognize the assignee alone as the
  owner of the right to the said shares.                                                                                                                                           
|                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|                                | 30.2.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | Notwithstanding the aforesaid, in the event of the death of one or
  more of the shareholders in whose joint names shares are registered in the
  Shareholders Register, the Company shall recognize only the surviving
  shareholders as owners of the proprietary right to such shares.                                                                                                                                                                                                                                                                                  
|                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|31.                             | 31.1                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | Subject to the provisions of these Articles, the Company shall change
  the registration of the ownership of shares in the Shareholders Register in
  the event that there shall be lodged with the Company a court order for the
  amendment of the Register or if there shall be proved to the Company, to its
  satisfaction of the in the manner fixed by it, the existence of the legal
  requirements for the transmission of shares, and the Company shall not
  recognize any right of any person to shares unless his right shall first be
  proved, as aforesaid.
|                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|                                | 31.2.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | Without derogating from the aforesaid, the Board may refuse to effect
  the registration or delay the same, as it would have been entitled to do had
  the registered shareholder himself transferred the share, prior to the
  transmission of the right.                                                                                                                                                                                                                                                                                                                 
|                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|32.                             | Subject to the provisions of the Companies Law and to the provisions
  of these Articles, a person who becomes entitled to a share as aforesaid in
  Article 30 above, shall be entitled to transfer the shares in the same way
  that the registered owner was entitled to do himself, prior to the
  transmission of the right.                                                                                                                                                                    
|                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|33.                             | The Company may destroy the Deeds of Transfer of shares on the
  expiration of seven years from registration in the Register, the Company may
  also destroy share certificates which have been cancelled on the expiration
  of seven years from their cancellation, and there shall be a prima facie
  presumption that the Deeds of Transfer and certificates destroyed were fully
  valid and that the transfers, cancellations and registrations, as the case
  may be, were correctly effected.
|                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|Alteration of the Share Capital
|                               
|34.                             | The Company may, by resolution carried at a General Meeting by a special
  majority, increase the registered share capital of the Company, by classes of
  shares, as it may determine.                                                                                                                                                                                                                                                                                                              

8

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|                       |                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                            
|---------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|35.                    | Subject to the provisions of the Companies Law, the Company may, by
  resolution carried at a General Meeting by an ordinary majority:                                                                                                                                                     
|                       |                                                                                                                                                                                                                                                                                            
|                       | 35.1.                                                                                                                                                                                                                                                                                       | To consolidate all or part of its shares and to divide them into
  shares of a greater par value than the par value of the existing shares;                                                                                                                                                                                                                                                                
|                       |                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                            
|                       | 35.2.                                                                                                                                                                                                                                                                                       | To split all or part of its shares, by way of subdivision, into
  shares of lesser par value than the par value of the existing shares;                                                                                                                                                                                                                                                                    
|                       |                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                            
|                       | 35.3.                                                                                                                                                                                                                                                                                       | To decrease the capital of the Company and of any reserve fund from
  redemption of capital.                                                                                                                                                                                                                                                                                                               
|                       |                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                            
|                       | For the execution of any resolution as aforesaid, the Board may, at
  its discretion, resolve any difficulty which may arise in connection
  therewith.                                                                                                                                    
|                       |                                                                                                                                                                                                                                                                                            
|36.                    | Without derogating from the generality of the authority of the Board,
  as aforesaid, if as a result of the consolidation or split, as aforesaid,
  fractions of a share shall stand to the credit of the any shareholders, the
  Board is authorized at its discretion, to act as follows:
|                       |                                                                                                                                                                                                                                                                                            
|                       | 36.1.                                                                                                                                                                                                                                                                                       | To determine that fractions of shares which do not entitle their
  owners to a whole share, shall be sold by the Company and that the
  consideration for the sale be paid to the beneficiaries, on the terms and in
  the manner which may be determined.                                                                                                                                                 
|                       |                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                            
|                       | 36.2.                                                                                                                                                                                                                                                                                       | To allot to every shareholder whom the consolidation and/or split
  leaves with a fraction of a share, shares of the class which existed prior to
  the consolidation and/or split, in such quantity which, when consolidated
  with the fraction, will constitute one whole share, and such allotment shall
  be deemed to be valid immediately prior to the consolidation or split, as the
  case may be.
|                       |                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                            
|                       | 36.3.                                                                                                                                                                                                                                                                                       | To determine the manner in which the amounts to be paid for shares
  allotted as aforesaid in Article 36.2 above, shall be paid up, including on
  account of bonus shares.                                                                                                                                                                                                                                
|                       |                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                            
|                       | 36.4.                                                                                                                                                                                                                                                                                       | To determine that the owners of fractions of shares shall not be
  entitled to receive a whole share in respect of a share fraction.                                                                                                                                                                                                                                                                       
|                       |                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                            
|                       | 36.5.                                                                                                                                                                                                                                                                                       | To determine that shareholders shall not be entitled to receive a
  whole share in respect of a fraction of a whole share of a determined par
  value or less than same, or that they shall be entitled to receive a whole share
  in respect of a fraction of a whole share the par value of which is greater
  than such determined par value.                                                           
|                       |                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                            
|37.                    | The Company may, by resolution carried at a General Meeting, by a
  special majority, annul registered share capital which has not yet been
  issued, provided that the Company has no undertaking, including a provisional
  undertaking, to allot such shares.                           
|                       |                                                                                                                                                                                                                                                                                            
|Modification of Rights

9

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|                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | 
|--------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | 
|38.                                     | At any time during which the share capital is divided into different
  classes, the Company may by resolution carried at a General Meeting, by a
  special majority, except if the terms of the issuance of the shares of such
  class otherwise provide, annul, convert, expand, supplement, restrict, amend
  or otherwise modify the rights of a class of shares of the Company, provided
  that the consent, in writing, of all the shareholders of such class thereto
  shall be received or that the resolution shall have been approved by a
  General Meeting of the shareholders of such class by special majority, or in
  the event that it was otherwise provided in the terms of the issuance of a
  particular class of the shares of the Company, as may have been provided in
  the terms of issuance of such class.                                                                                                                                                                                                       
|                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|39.                                     | The provisions of these Articles concerning General Meetings shall
  apply, subject to the necessary changes, to any class meeting provided that
  the quorum at the class meeting shall be the presence, in person or by proxy,
  at the opening of the meeting of at least two shareholders who own at least
  thirty three and one third percent of the number of the issued shares of such
  class. However if there is no such quorum with half an hour from the time
  fixed for the meeting, the meeting shall be adjourned in a week, to the same
  day, time and place, or to a later date or to another place if such was
  specify in the Companys notice, and at the adjourned meeting a quorum shall
  be constituted by any number of participants regardless of the number of
  shares held by them.                                                                                                                                                                                                                       
|                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|40.                                     | The rights conferred upon the shareholders or owners of a class of
  shares, whether issued with ordinary rights or with preference rights or with
  other special rights, shall not be deemed to have been converted, restricted,
  prejudiced or altered in any other manner by the creation or issuance of
  additional shares of any class, whether of the same degree or in a degree
  different or preferable to them, nor shall they be deemed to have been
  converted, restricted, prejudiced or altered in any other manner by a change
  of the rights linked to any other class of shares, all the aforesaid unless
  otherwise expressly provided in the terms of the issuance of such shares.                                                                                                                                                                                                                                                                                                                                
|                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|Issuance of Shares and Other Securities
|                                       
|41.                                     | The Company may issue shares and other securities which are
  convertible or realizable for shares, as determined by the Board, up to the
  extent of the registered share capital of the Company; for this purpose
  convertible securities which may be converted or realized for shares shall be
  deemed to have been converted or realized at the time of issue. Without
  derogation from the generality of the aforesaid, the Company may issue shares
  and other securities, as aforesaid, to grant optional rights for the purchase
  thereof including options or to confer them in any other manner, all the
  aforesaid to such persons, at such times, for such prices and upon such
  conditions, and also to determine any other provision in connection
  therewith, including provisions as to the manner of the distribution of the
  shares and the securities issued by the Company, between the purchasers thereof,
  including in the case of over subscription, all the aforesaid at the
  discretion of the Board.
|                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|42.                                     | Without derogating from the generality of the foregoing, and subject
  to the provisions of the Companies Law and of these Articles, the Board may
  determine, at its discretion, that the consideration for shares shall be paid
  in cash or in kind, including in securities or in                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     

10

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|                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                             
|--------------------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                      | any other manner, or that the shares shall be allotted as bonus
  shares or be allotted for a consideration equal to or greater than their par
  value, either in units or in series, all the aforesaid on the terms and at
  the times as may be determined by the Board at its discretion.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|43.                   | In a resolution for the increase of the registered share capital of
  the Company, the General Meeting may determine that the new shares included
  in the amount by which the registered share capital was increased as
  aforesaid (hereinafter - the New Shares), or any part of them, shall
  first be offered, at par value or at a premium, to all the existing
  shareholders in proportion to the par value of their shares in the Company or
  may determine other provisions with regard to the issuance and allotment of
  the new shares. However, in the absence of such a determination by the
  General Meeting in the resolution to increase the registered share capital of
  the Company, the Board may offer such shares as aforesaid in Article 41
  above.
|                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|44.                   | The Company may pay commissions or underwriting fees to any person,
  at the time of subscription or a subscription agreement or the procurement of
  subscriptions or pledge of subscriptions for shares or debentures or other
  securities of the Company as the Board may determine. The Company may also
  pay, in the event of any issuance of securities of the Company, agency commissions,
  the aforesaid in cash, in shares of the Company or in other securities issued
  by the Company, or in any other manner, or partly in one manner and partly in
  another manner, all the aforesaid as the Board may determine subject to the
  provisions of law.                                                                                                           
|                     
|Redeemable Securities
|                     
|45.                   | Subject to the provisions of the Companies Law the Company may issue
  securities which may be redeemed on such terms and in such manner as may be
  determined by the Board at its discretion.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|Registers            
|                     
|46.                   | 46.1                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | The Company shall maintain a Register of Shareholders according to
  the provisions of the Companies Law. Subject to the provisions of the
  Companies Law, upon registration in the Register the registered shareholder
  shall be deemed to be the owner of the shares registered in his name even if
  share certificates have not been issued in respect of such shares.
|                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                             
|                      | 46.2.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | The Company shall maintain a Register of Material Shareholders, as
  required by the Companies Law and defined there.                                                                                                                                                                                                                                                       
|                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                             
|47.                   | The Company may maintain an additional Shareholders Register outside
  of Israel on the terms provided for such purpose by the Companies Law.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|48.                   | The Company shall maintain a Register of Debenture Holders and
  Convertible Security Holders and all the provisions of these Articles relating
  to shares shall apply with regard                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              

11

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|                 |                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                            
|---------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                 | to such Convertible Securities, as regards registration in the
  Register, issue of certificates, exchange of certificates, transfer and
  transmission, subject to such changes as the context may require, all the
  aforesaid subject to the terms of the issue of the securities.
|                
|General Meetings
|                
|49.              | Resolutions of the Company in the following matters shall be adopted
  at a General Meeting:                                                                                                                                                                                         
|                 |                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                            
|                 | 49.1.                                                                                                                                                                                                                                                                                 | Alterations of the Articles or Memorandum of the Company;                                                                                                                                                                                                                                  
|                 |                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                            
|                 | 49.2.                                                                                                                                                                                                                                                                                 | Exercise of the authorities of the Board of Directors by General
  Meeting in the event that the Board is not able to exercise its authorities
  and the exercise of any authority is vital for the proper management of the
  Company, as provided in the provisions of the Companies Law;
|                 |                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                            
|                 | 49.3.                                                                                                                                                                                                                                                                                 | Appointment and termination of employment of auditors;                                                                                                                                                                                                                                     
|                 |                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                            
|                 | 49.4.                                                                                                                                                                                                                                                                                 | Appointment and dismissal of Directors;                                                                                                                                                                                                                                                    
|                 |                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                            
|                 | 49.5.                                                                                                                                                                                                                                                                                 | Approval of actions and transactions which are subject to approval at
  a General Meeting in accordance with the provisions of sections 255 and 268
  to 275 of the Companies Law;                                                                                                         
|                 |                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                            
|                 | 49.6.                                                                                                                                                                                                                                                                                 | Increase of the registered share capital and the decrease thereof in
  accordance with the provisions of sections 286 and 287 of the Companies Law
  as well as alterations in capital as provided for in Article 35 above;                                                                
|                 |                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                            
|                 | 49.7.                                                                                                                                                                                                                                                                                 | Merger in accordance with section 320(a) of the Companies Law;                                                                                                                                                                                                                             
|                 |                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                            
|                 | 49.8.                                                                                                                                                                                                                                                                                 | Any matter which pursuant to the Law or in accordance with these
  Articles is required to be adopted by resolution of a General Meeting.                                                                                                                                                  
|                 |                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                            
|50.              | The Company shall hold an Annual General Meeting each year not later
  than fifteen months after the previous Annual Meeting, at such time and place
  as may be determined by the Board.                                                                                            
|                 |                                                                                                                                                                                                                                                                                      
|51.              | The Agenda of the Annual General Meeting shall include the following
  items:                                                                                                                                                                                                        
|                 |                                                                                                                                                                                                                                                                                      
|                 | 51.1.                                                                                                                                                                                                                                                                                 | Discussion of the Financial Statements and Directors Report which
  are presented to the General Meeting;                                                                                                                                                                                 
|                 |                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                            
|                 | 51.2.                                                                                                                                                                                                                                                                                 | Appointment of Directors and determination of their remuneration;                                                                                                                                                                                                                          
|                 |                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                            
|                 | 51.3.                                                                                                                                                                                                                                                                                 | Appointment of auditors;                                                                                                                                                                                                                                                                   
|                 |                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                            
|                 | 51.4.                                                                                                                                                                                                                                                                                 | Report of the Board as to the auditors fee for auditing and
  additional services, if any;                                                                                                                                                                                                

12

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|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    | 51.5.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | In addition to the aforesaid, there may be included on the agenda of
  the Annual Meeting any other matter determined in accordance with Article 55
  hereafter.                                                                                                                               
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                
|    | A General Meeting as aforesaid is referred to as an Annual Meeting
  and any other General Meeting is referred to as an Extraordinary Meeting.                                                                                                                                                                                                                                                                                                                                                                                             
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|52. | The Board of Directors of the Company shall convene a Extraordinary
  Meeting as may be decided by the Board, and shall also convene a
  Extraordinary Meeting at the demand of any one of the following:                                                                                                                                                                                                                                                                                                                                      
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                
|    | 52.1.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | Any two Directors or one quarter of the officiating Directors.                                                                                                                                                                                                                                 
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                
|    | 52.2.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | One or more shareholders who hold at least five percent of the voting
  rights in the Company.                                                                                                                                                                                                 
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                
|53. | If the Board receives a demand for the convening of an Extraordinary
  Meeting as aforesaid, the Board shall within twenty one days of receipt of
  the demand convene the meeting for a date fixed in the notice as to the
  Extraordinary Meeting in accordance with Article 57.1 hereafter, provided
  that the date for convention shall not be later than thirty five days from
  the date of publication of the notice, all the aforesaid subject to the provisions
  of the Companies Law.                                              
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|54. | In the event that the Board does not convene a Extraordinary Meeting
  demanded in accordance with Article 52 above, the persons making the demand,
  and in the case of shareholders - such part of them as hold at least one half
  of their voting rights, may themselves convene the meeting provided that it
  shall not be held more than three months of the date that the demand was
  lodged as aforesaid, and the meeting shall be convened, to the extent
  possible, in the same manner as the convention of meetings by the Board.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|55. | 55.1                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | The agenda at a General Meeting shall be fixed by the Board and shall
  include also items in respect of which a demand for the convention of a
  Extraordinary Meeting has been made in accordance with Article 52 above and
  any matter requested in accordance with Article 55.2 hereafter.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                
|    | 55.2.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | One or more shareholders who hold at least one percent of the voting
  rights at the General Meeting, may request the Board to include any matter on
  the agenda of a meeting to be held provided that such matter is appropriate
  for deliberation at a General Meeting.                    
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                
|    | 55.3.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | A request as aforesaid in Article 55.2 above shall be lodged with the
  Company at least seven days prior to the giving of notice of the convening of
  the General Meeting, and there shall be attached thereto a draft of the
  resolution proposed by the shareholder.                      
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                
|56. | 56.1.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | A notice of a General Meeting
  shall be published in at least two widely distributed daily
  newspapers published in Hebrew. The notice shall be published at least
  fourteen days prior to the convening of the meeting or before if required by
  law.                                     

13

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|                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                               
|------------------------------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                | 56.2.                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | Apart from the notice as to the General Meeting as in Article 56.1
  above, the Company shall not give any notice as to the General Meeting,
  either to the registered shareholders or to shareholders who are not
  registered.                                                                                                                                                                                                             
|                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                               
|57.                             | 57.1                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | The notice as to a General Meeting shall detail the place, the day
  and the hour at which the meeting will be held and shall include the agenda
  as well as a summary of the proposed resolutions and any other details
  required by law.                                                                                                                                                                                                  
|                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                               
|                                | 57.2.                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | In the resolution of the Board to convene a meeting, the Board may
  fix the manner in which the items on the agenda will be detailed and notified
  to the shareholders entitled to participate at the meeting, all at according
  to the discretion of the Board and subject to the provisions of the Law.                                                                                                                                  
|                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                               
|                                | 57.3.                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | Without derogating from the authority of the Board as aforesaid in
  this article 57 and without derogating from the generality of the provisions
  of these Articles relating to delegation of the authority of the Board, the
  Board may delegate its authority as aforesaid in this article 57, to a
  Committee of the Board and/or to an officer of the company, either for the
  purpose of a specific General Meeting or for a period.
|                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                               
|58.                             | A defect made bona fide in the convening of a General Meeting or the
  management of the meeting including a fault resulting from the
  non-performance of a provision or condition fixed by law or by these
  Articles, including as to the manner of the convention or management of the
  General Meeting, shall not invalidate any resolution carried at the General
  Meeting and shall not prejudice the proceedings thereof, subject to the
  provisions of any law.
|                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|Proceedings at General Meetings
|                               
|59.                             | No business shall be transacted at any General Meeting unless a
  quorum is present at the time of the opening of the meeting. A quorum shall
  be constituted when two shareholders, holding collectively at least thirty-three
  and one third percent of the voting rights, are present in person or by
  proxy, within half an hour from the time set for the meeting, unless
  otherwise determined in these Articles.                                                
|                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|60.                             | If a quorum is not present within half an hour from the time set for
  the meeting, the meeting shall stand adjourned for seven days, to the same
  day of the week at the same time and place, without need for notification to
  the shareholders, or to such other day, time and place as the Board may
  determined in the notice to the shareholders, as mentioned in article 56
  above.                                                                             

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|-------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -----------------------------------------------------------------------------------------------------------
|61.                                                      | At an adjourned meeting a quorum shall be constituted when two
  shareholders, holding collectively at least thirty-three and one third
  percent of the voting rights, are present in person or by proxy, within half
  an hour from the time set for the opening of the adjourned meeting. If a
  quorum is not present as aforesaid, at the adjourned meeting, the meeting
  shall be held if one shareholder, holding at least twenty five percent of the
  voting rights, is present in person or by proxy.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|                                                         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|62.                                                      | The Chairman of the Board or in his absence, any Director or officer
  appointed for such purpose by the Chairman of the Board, shall take the chair
  at every General Meeting of the Company. If there shall be no Chairman as
  aforesaid or if at any particular meeting, no such person is present within
  fifteen minutes from the time set for commencement of the meeting, or if they
  shall be unwilling to act as Chairman of the meeting, the Directors present
  may by majority vote elect as Chairman one of the Directors or officers of
  the Company present at the meeting, and in default of their so doing, the
  shareholders present in person or by proxy may elect as Chairman one of the
  Directors or officers of the Company present at the meeting. If no Directors
  or officers are present or if all of the Directors or officers shall be
  unwilling to act as Chairman, one of the shareholders or the proxy of a
  shareholder shall be elected to act as Chairman.
|                                                         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|63.                                                      | The Company shall maintain Minutes of the proceedings at the General
  Meeting which shall include the following details:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|                                                         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|                                                         | 63.1.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | The names of the shareholders participating at the General Meeting
  and the number of shares held by them;
|                                                         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                            
|                                                         | 63.2.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | The matters transacted at the General Meeting and the resolutions
  carried.                               
|                                                         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                            
|64.                                                      | Minutes signed by the Chairman of the General Meting shall constitute
  prima facie evidence as to the contents thereof.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|                                                        
|Voting and Carrying of Resolutions at
  General Meetings
|                                                        
|65.                                                      | A non-registered shareholder who wishes to vote at a General Meeting
  shall prove to the Company his ownership of his share to the date prescribed
  in the notice given for the convening of the General Meeting. Subject to the
  provisions of the Companies Law, the Board may issue directives and
  procedures relating to the proof of ownership of shares of the Company.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|66.                                                      | A shareholder is entitled to vote at a General Meeting or Class
  Meeting, in person or by proxy, in accordance with the provisions of these
  Articles and subject to the provisions of the Companies Law. A voting proxy
  need not be a shareholder of the Company.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|                                                         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|66A.                                                     | Deed of Vote  A Shareholder may vote in a Shareholders
  Meeting by means of a Deed of Vote (ktav
  hatzbaah) on any issue for which voting by Deed of Vote is
  required to be offered under applicable Law and on any other issue for which
  the Board of Directors has approved voting by Deed of Vote, either generally
  or specifically. The form of the Deed                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   

15

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|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                   
|---- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------
|     | of Vote shall be set by the corporate secretary or any one so
  authorized by the Board of Directors.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|     | For the
  purposes of these articles, a proxy would also apply, mutatis mutandis, to
  a Deed of Vote and may be used instead of a Deed of Vote, subject to the
  applicable law.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|66B. | The Board of
  Directors may authorize shareholder voting in a general meeting via the
  Internet, subject to applicable law.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|67.  | Subject to the provisions of any law, in the event of joint holders,
  each of them, in person or by proxy, is entitled to vote at any meeting in
  respect of the jointly owned shares as though he were the sole owner. In the
  event that more than one of the joint owners is present at the meeting, in
  person or by proxy, the shareholder entitled to vote will be the one whose
  name appears first in the Register or in the Ownership Certificate (as
  defined in the Law) issued by a member of the Stock Exchange, or in such
  other document determined by the Board for such purpose, as the case may be.
  Several executors or administrators of a deceased shareholder shall for the
  purpose of this article be deemed joint owners of the shares.                              
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|68.  | Any person entitled to shares in accordance with article 30 above,
  may vote at any General Meeting in respect thereof in the same manner as if
  he were the registered holder of such shares, provided that at least forty
  eight hours before the time for the meeting or the adjourned meeting, as the
  case may be, at which he proposes to vote, he shall satisfy the Company of
  his right to vote such shares unless the Company shall have previously
  recognized his right to vote the shares at such meeting.                                                                                                                                                                                                                                                                            
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|69.  | The instrument appointing a proxy (hereinafter The Proxy Appointment)
  shall be in writing signed by the appointing shareholder.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|     | The proxy appointment or an office copy to the satisfaction of the
  Company shall be deposited at the registered office or at such other place or
  places, in or outside of Israel, - as may from time to time be determined by
  the Board, either generally or in respect of a specific meeting - at least
  forty eight hours prior to the commencement of the meeting or the adjourned
  meeting, as the case may be, at which the proxy proposes to vote on the
  strength of such proxy appointment. Notwithstanding the aforesaid, the
  Chairman of the meeting may, at his discretion, accept such proxy appointment
  after such time if he so deems fit at his discretion. If the proxy
  appointment is not received as aforesaid in this article, it shall not be
  valid at such meeting.
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|70.  | A voting proxy is entitled to participate in the discussions at the
  General Meeting and to be elected as chairman of the meeting in the same
  manner as the appointing shareholder, unless the proxy appointment otherwise
  provides.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|71.  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                   
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|     | 71.1                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | The proxy appointment shall be in form
  usual in Israel or any other form which may be approved by the Board or the
  person/s designated by it for this purpose.

16

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|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    | 71.2                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | The proxy appointment shall state the class and number of shares in
  respect of which it is given. If the proxy appointment does not state the
  number of shares in respect of which it is given or states a number of shares
  which exceeds the number registered in the name of the shareholder or stated
  in the Ownership Certificate, as the case may be, the proxy instrument shall
  be deemed to have been given in respect of all the shares of the shareholder
  according to the registration in the Companys Register or in the Ownership
  Certificate, as the case may be.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|    | 71.3                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | If the proxy appointment is given in respect of a number of shares
  which is less than the number of shares registered in the name of the
  shareholder or stated in the Ownership Certificate, as the case may be, the
  shareholder shall be deemed not to have participated in the voting in respect
  of the excess shares and the proxy appointment shall be valid in respect of
  the number of shares stated therein.                                                                                                                                                                
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|72. | Without derogating from the provisions of these Articles relating to
  the appointment of a proxy for voting, a shareholder who holds more than one
  share is entitled to appoint more than one proxy, subject to the following
  provisions:                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | 72.1                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | Each proxy appointment shall state the class and number of shares in
  respect of which it is given.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | 72.2                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | If the total number of shares of any class stated in proxy
  appointments given by such shareholder exceeds the number of shares
  registered in the name of the shareholder in the Companys Register or stated
  in the Ownership Certificate, as the case may be, said shareholder will be
  eligible to vote only the shares registered in the said shareholders name in
  the Companys Register on the condition that the voting instructions are
  identical in all the proxy appointments given by the same shareholder. If the
  voting instructions differ, all the proxy appointments given by such shareholder
  shall be invalid.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|73. | A shareholder or his voting proxy may vote in respect of part only of
  the shares held by him or in respect of which he acts as proxy, and he may
  vote one way in respect of some of the shares and another way in respect of
  some thereof.                                                                                                                                                                                                                                                                                                                                                                                                                                    
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|74. | A vote given by virtue of a proxy appointment shall be valid
  notwithstanding any defect in the proxy appointment and also in case of the
  previous decease of the principal or declaration of his legal incapacity or
  revocation of the proxy appointment or transfer of the shares in respect of
  which the vote is given, unless a notice in writing has been received at the
  office prior to the meeting as to such defect, death, incapacity, revocation
  or transfer, as the case may be. Notwithstanding the aforesaid the chairman
  of the meeting may, at his discretion accept such a notice also during the
  meeting if he shall so deem fit at his discretion.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|75. | A proxy appointment shall be valid also in respect of an adjourned
  meeting of the meeting to which the proxy appointment relates unless
  otherwise provided in the proxy appointment.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            

17

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|                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   | 
|---------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | 
|76.                    | Each Ordinary Share entitles the holder thereof to participate at a
  General Meeting of the Company and to one vote at a poll.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|77.                    | Any resolution standing to the vote of a General Meeting shall be
  decided by a poll of the votes of the shareholders voting. A poll shall be
  taken in such manner as the chairman of the meeting may direct. In case of
  any dispute as to the acceptance or rejection of any vote on a poll, the
  chairman of the meeting shall determine the matter and his bona fide decision
  shall be final and binding.                                                                                                                                                                                                                                                                                                                             
|                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|78.                    | A declaration by the chairman that a resolution has been carried or
  rejected, whether unanimously or by a particular majority, and an entry to
  that effect in the minutes of the meeting, shall constitute prima facie
  evidence of such fact, and there be no necessity to prove the number of votes
  (or the relative proportion thereof) cast in favor or against the proposed
  resolution.                                                                                                                                                                                                                                                                                                                                            
|                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|79.                    | Subject to the provisions of the Companies Law or the provisions of
  these Articles requiring any other majority, resolutions of a General Meeting
  shall be adopted by a simple majority. The chairman of the meeting shall not
  have a second or casting vote.                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|80.                    | The chairman of a General Meeting may, with the consent of a meeting
  at which a quorum is present, and shall if so directed by the meeting,
  adjourn the meeting or adjourn the proceedings with regard to any particular
  matter on the agenda, to another time and place as may be decided. No
  business shall be transacted at the adjourned meeting other than business
  which was on the agenda but unfinished at the meeting from which the
  adjournment took place. It shall not be necessary to give notice of the adjourned
  meeting unless the adjournment exceeds twenty one days, in which case notice
  of the adjourned meeting shall be given according to the provisions of these
  Articles regarding a General Meeting.
|                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|The Board of Directors
|                      
|81.                    | The number of the members of the Board (hereinafter: Directors)
  shall not be less than five and shall not exceed fifteen, including the
  External Directors, as defined in the Companies Law.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|82.                    | The Directors shall be appointed at the Annual Meeting and, with the
  exception of the External Directors, shall continue in office until the
  termination of the first Annual Meeting following their appointment.
  Notwithstanding the aforesaid, if no Directors were appointed at the Annual
  Meeting, the Directors appointed at the previous Annual Meeting shall
  continue in office. Directors whose period of office is expiring are eligible
  for re-appointment, except for External Directors, whose nomination and
  duration of service shall be as set forth in the Companies Law.                                                                                                                                          
|                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|83.                    | No person other than a person who officiated as a Director up to the
  Annual Meeting, shall be appointed as a Director at the Annual Meeting,
  unless recommended for appointment by the Board, or unless a shareholder of
  the company who wishes to propose a candidate shall have lodged at the
  office, not later than within seven days of the publication of the notice of
  the meeting, a document in writing signed by the shareholder                                                                                                                                                                                                                                                                                              

18

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|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    | notifying
  his intention to propose such candidate for appointment as a Director, to
  which document there shall be attached the consent of the candidate to
  officiate as a Director and his/her resume.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|84. | The Board
  may appoint, from time to time, an additional Director or Directors, whether
  in order to fill the office of a Director which has become vacant for any
  reason whatsoever or as an additional Director or Directors, provided that
  the total number of Directors shall not exceed the maximum number fixed in
  Article 81 above. The office of a Director appointed as aforesaid shall
  terminate at the end of the Annual Meeting held following his appointment and
  he shall be eligible for re-appointment.                                                                                                                                                         
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|85. | An
  Extraordinary Meeting may appoint, from time to time, an additional Director
  or Directors, whether in order to fill the office of a Director which has
  become vacant for any reason whatsoever or as an additional Director or
  Directors, provided that the total number of Directors shall not exceed the maximum
  number fixed in Article 81 above, and the provisions of Article 83 above
  shall apply also on the appointment of a Director in an Extraordinary
  Meeting, with the relevant changes. The office of Directors, other than
  External Directors, appointed as aforesaid shall terminate at the end of the
  Annual Meeting held following their appointment.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|86. | The service
  of a Director in office shall commence on the day of his/her appointment by
  the Board or by the General Meeting, as the case may be, unless a later date
  was set for the commencement of such service in office.                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|87. | Notwithstanding
  the aforesaid, the General Meeting may at any time, by a simple majority,
  remove any Director, other than an External Director, from office prior to
  the expiration of his office, provided that there shall be afforded to such
  Director a reasonable opportunity to present his standpoint before the
  General Meeting. Any General Meeting may also appoint, may also remove any
  External Director, from office, according to the provisions of the Companies
  Law.                                                                                                                                                                                          
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|88. | Without
  prejudice to the provisions of any law, the office of any Director, other
  than an External Director, shall terminate prior to the termination of the
  period for which he was appointed, in the event that there shall be served
  upon him a demand that he should resign signed by at least two thirds of the
  Directors then officiating.                                                                                                                                                                                                                                                                                                                                  
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|89. | In the event
  of the vacation of the office of a Director, the Board may continue to act in
  all matters so long as the number of Directors does not fall below the
  minimum number of Directors fixed in article 81 above. If the number of
  Directors shall fall below such number, the Board may not act otherwise than
  for the convention of a General Meeting for the purpose of the appointment of
  additional directors but not for any other purpose.                                                                                                                                                                                                                        
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|90. | A Director
  may resign by notice to the Board, to the chairman or to the office, as
  required by the Companies Law, and his resignation shall come into effect
  upon delivery of such notice, unless the notice shall determine a later date.
  A Director shall state the reasons for his resignation.                                                                                                                                                                                                                                                                                                                                                                                  

19

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|                               |                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|------------------------------ | -------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|91.                            | Subject to
  the provisions of the Companies Law, the Company may pay the Directors
  remuneration for carrying out their duty as Directors.                        
|                               |                                                                                                                                                                     
|92.                            |                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|                               |                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|                               | 92.1                                                                                                                                                                 | A Director,
  except an external director, may appoint a substitute director in his place
  subject to the approval of the substitute by the Board (hereinafter - theSubstitute
  Director). Notwithstanding the aforesaid, there shall not be appointed as a
  Substitute Director, any person who is not himself qualified to be appointed
  a director, or who himself already officiates as a Substitute Director of
  another Director. A person who already officiates as a Director of the
  Company shall not be appointed as a Substitute Director, other than as a
  substitute in a Board Committee
|                               |                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|                               | 92.2                                                                                                                                                                 | The same
  rules shall apply to a Substitute Director as to the Director who appointed
  the Substitute Director.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|                               |                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|                               | 92.3                                                                                                                                                                 | The
  Substitute Director may attend a meeting of the Board and/or committees of
  the Board, in which the Director who appointed him/her was a member, to
  participate and vote there at, in the same manner as could the Director who
  appointed the Substitute.                                                                                                                                                                                                                                                                                                                                            
|                               |                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|                               | 92.4                                                                                                                                                                 | A Director
  who has appointed a Substitute Director may, subject to the provisions of
  law, revoke the appointment at any time. In addition the office of a
  Substitute Director shall be vacated at any time that the office of the
  Director who appointed the Substitute is vacated in any manner whatsoever.                                                                                                                                                                                                                                                                                            
|                               |                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|                               | 92.5                                                                                                                                                                 | Any
  appointment or revocation of the appointment of a Substitute Director, as
  aforesaid, shall be made by notice in writing which shall be lodged with the
  Substitute Director and with the Company. Subject to article 92.1 above, any
  appointment or revocation, as the case may be, shall come into force after
  the lodging of the notice as aforesaid or upon such date as is fixed in the
  notice, whichever is the later.                                                                                                                                                                      
|                               |                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|                               | 92.6                                                                                                                                                                 | Subject to
  the provisions of the Companies Law, the Company may pay a Substitute
  Director remuneration for participation at meetings of the Board, on the
  condition that the Director, the Substitute Director is replacing, is not
  present at the Board Meeting for which remuneration is sought.                                                                                                                                                                                                                                                                                                      
|                               |                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|External Directors            
|                              
|93.                            | At least two
  External Directors shall officiate in the Company in respect of whom the
  provisions in this respect fixed in the Companies Law shall be applicable.
|                               |                                                                                                                                                                     
|Powers and Duties of The Board
|                              
|94.                            | The Board
  shall have all the powers and authorities conferred upon it by these
  Articles, by the Companies Law and by any other Law.                             

20

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|    |                                                                                                                                                                                                                                    |                                                                                                                                                                                                                          
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|95. | Without
  derogating from the provisions of these Articles, the Board shall formulate
  the policy of the Company and shall supervise the performance of the office and
  actions of the Managing Director, including inter alia -
|    |                                                                                                                                                                                                                                   
|    | 95.1.                                                                                                                                                                                                                              | Determination
  of the business plans of the Company, financing principles and priorities;                                                                                                                               
|    |                                                                                                                                                                                                                                    |                                                                                                                                                                                                                          
|    | 95.2.                                                                                                                                                                                                                              | Examination
  of the financial position of the Company and determine the credit framework
  which the Company may receive;                                                                                               
|    |                                                                                                                                                                                                                                    |                                                                                                                                                                                                                          
|    | 95.3.                                                                                                                                                                                                                              | Fixing the
  organizational structure and salary policy;                                                                                                                                                                 
|    |                                                                                                                                                                                                                                    |                                                                                                                                                                                                                          
|    | 95.4.                                                                                                                                                                                                                              | Decision as
  to the issue of a series of debentures;                                                                                                                                                                    
|    |                                                                                                                                                                                                                                    |                                                                                                                                                                                                                          
|    | 95.5.                                                                                                                                                                                                                              | Responsibility
  for the preparation and approval of Financial Statements, in accordance with
  section 117 of the Companies Law;                                                                                        
|    |                                                                                                                                                                                                                                    |                                                                                                                                                                                                                          
|    | 95.6.                                                                                                                                                                                                                              | Report to
  the Annual Meeting on the affairs of the Company and business results, in
  accordance with the provisions of the Companies Law;                                                                             
|    |                                                                                                                                                                                                                                    |                                                                                                                                                                                                                          
|    | 95.7.                                                                                                                                                                                                                              | Appointment
  and dismissal of the General Manager;                                                                                                                                                                      
|    |                                                                                                                                                                                                                                    |                                                                                                                                                                                                                          
|    | 95.8.                                                                                                                                                                                                                              | Decision
  with regard to activities and transactions which require approval of the
  Board in accordance with these Articles or in accordance with the provisions
  of sections 255 and 268 to 275 of the Companies Law;
|    |                                                                                                                                                                                                                                    |                                                                                                                                                                                                                          
|    | 95.9.                                                                                                                                                                                                                              | Allotment of
  shares and securities convertible to shares up to the registered share
  capital of the Company;                                                                                                          
|    |                                                                                                                                                                                                                                    |                                                                                                                                                                                                                          
|    | 95.10.                                                                                                                                                                                                                             | Decision as
  to the distribution of dividends or bonus shares, as the case may be;                                                                                                                                      
|    |                                                                                                                                                                                                                                    |                                                                                                                                                                                                                          
|    | 95.11.                                                                                                                                                                                                                             | Decision as
  to tender offer within the meaning of section 1 of the Companies Law, from
  all or part or any of the shareholders of the Company, at its discretion;                                                     
|    |                                                                                                                                                                                                                                    |                                                                                                                                                                                                                          
|    | 95.12.                                                                                                                                                                                                                             | Opinion as
  to a special tender offer, in accordance with the provisions of section 329
  of the Companies Law;                                                                                                         
|    |                                                                                                                                                                                                                                    |                                                                                                                                                                                                                          
|    | The powers
  of the Board in accordance with these Articles may not be delegated to the
  General Manager.                                                                                                                        
|    |                                                                                                                                                                                                                                   
|96. | Any power of
  the Company which has not been conferred by law or by these Articles to any
  other body, may be exercised by the Board.                                                                                           
|    |                                                                                                                                                                                                                                   
|97. | 97.1                                                                                                                                                                                                                               | The Board
  may resolve that the powers vested in the General Manager shall be
  transferred to the authority of Board, the aforesaid in respect of a specific
  matter or for a particular period.                      
|    |                                                                                                                                                                                                                                    |                                                                                                                                                                                                                          
|    | 97.2.                                                                                                                                                                                                                              | Without
  derogating from the aforesaid, the Board may instruct the General Manager as
  how to act with regard to a specific matter. If the General Manager                                                             

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|                                                             |                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|------------------------------------------------------------ | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                             |                                                                                                                                                                                                                                                                                                                                                                | shall not
  carry out such instruction, the Board may exercise instead of him the powers
  necessary for carrying out such instruction.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|                                                             |                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|                                                             | 97.3.                                                                                                                                                                                                                                                                                                                                                          | If the
  General Manager is unable to carry out his powers, the Board may carry them
  out in his place.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|                                                             |                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|98.                                                          | Subject to
  the provisions of the Companies Law, the Board may delegate its powers to the
  General Manager, to an officer of the Company or to any other person.
  Delegation of the powers of the Board may be with regard to a specific matter
  or for a particular period, the aforesaid at the discretion of the Board.                                
|                                                             |                                                                                                                                                                                                                                                                                                                                                               
|Receipt of Credit and the Grant of Guaranties and Securities
|                                                            
|99.                                                          | The Company
  may, from time to time:                                                                                                                                                                                                                                                                                                                         
|                                                             |                                                                                                                                                                                                                                                                                                                                                               
|                                                             | 99.1.                                                                                                                                                                                                                                                                                                                                                          | Receive
  credit in any amount and secure the repayment thereof in any manner, and
  grant guaranties, securities and bonds of any kind whatsoever, as the Board,
  at its discretion may decide.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|                                                             |                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|                                                             | 99.2.                                                                                                                                                                                                                                                                                                                                                          | Receive
  credit in an amount and conditions decided by the General Manager or the
  person designated by him for that purpose, in the framework of the credit and
  securities set by the Board.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|                                                             |                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|                                                             | 99.3.                                                                                                                                                                                                                                                                                                                                                          | The issue of
  a series of debentures, including capital notes or undertakings, including
  debentures, capital notes or undertakings which can be converted to shares,
  and also the terms thereof, and mortgage of the property of the Company, in
  whole or in part, at present or in future, by floating or fixed charge, as
  the Board, at its discretion may decide. Debentures, capital notes,
  undertakings or other securities, as aforesaid, may be issued either at a
  discount or at a premium or in any other manner, whether with deferred rights
  or special rights and/or preferred rights and/or other rights, all the
  aforesaid as the Board may, at its discretion, determine.
|                                                             |                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|Committees of the Board                                     
|                                                            
|100.                                                         | Subject to
  the provisions of the Companies Law, the Board may, as it deems fit, set up
  committees of two or more persons, appoint members of such committees
  (hereinafter - aBoard Committee), and delegate its
  powers, in whole or in part, to a Board Committee.                                                                                  
|                                                             |                                                                                                                                                                                                                                                                                                                                                               
|101.                                                         | The Board
  may from time to time enlarge, limit or annul the delegation of powers to a
  Board Committee, however no such limitation or annulment as aforesaid, shall
  prejudice the validity of any resolution of the Board Committee in accordance
  with which the Company shall have acted vis-a-vis a third party who was not
  aware of the annulment.
|                                                             |                                                                                                                                                                                                                                                                                                                                                               
|102.                                                         |                                                                                                                                                                                                                                                                                                                                                                | 102.1     The
  quorum for proceeding to business at a meeting of a Board Committee shall be
  two committee members officiating at the time of the meeting, in person or by
  their substitute, unless otherwise determined by the Board.                                                                                                                                                                                                                                                                                                                                                                                                                                                               

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|                         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|------------------------ | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                         | 102.2                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | The
  provisions of these Articles with regard to actions of the Board, shall
  apply, except as the context otherwise requires, also to Board Committees, so
  long as they shall not have been replaced by instructions of the Board in
  such respect, all the aforesaid subject to the provisions of the Companies
  Law.                                                                                                                                                                
|                         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|                         | 102.3                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | A Board Committee
  shall regularly report its resolutions and recommendations to the Board.                                                                                                                                                                                                                                                                                                                                                                                                 
|                         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|103.                     | A resolution
  carried or an action taken by a Board Committee shall be as effective as a
  resolution carried or action taken by the Board, unless otherwise expressly
  determined by the Board with regard to a specific matter or with regard to a
  specific committee.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|                         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|104.                     | 104.1                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | The Board
  shall, from among its members, appoint an Audit Committee. The number of
  members of the Audit Committee shall not be less than three and all the
  External Directors shall be members thereof. The following persons shall not
  be members of the Audit Committee: The Chairman of the Board, any director
  who is employed by the Company or who provides the Company with services on a
  fixed basis, any controlling shareholder of the Company or a relative of
  same.
|                         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|                         | 104.2                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | The
  functions of the Audit Committee shall be as determined by the Companies Law
  including any other function which may be imposed upon it by the Board.                                                                                                                                                                                                                                                                                                                                 
|                         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|Proceedings of the Board
|                        
|105.                     | Subject to
  the provisions of these Articles, the Board may hold meetings to carry out
  its functions, may adjourn its meetings and may organize its actions and
  discussions as it may deem fit.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|                         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|106.                     | The Board
  shall appoint one of its members to act as Chairman of the Board and may
  appoint more than one Chairman of the Board (each of whom is hereinafter
  referred to as - The Chairman of the Board). The Board
  may also remove the Chairman of the Board from office and appoint another in
  his place. The Board may appoint one or more of its members as Vice-chairman
  of the Board who shall serve in place of the Chairman in his absence. The
  Board may fix the period during which the Chairman and Vice-Chairmen of the
  Board shall remain in office. If no such period is fixed, the Chairman and
  Vice-Chairmen of the Board shall remain in office so long as they officiate
  as directors, or others are appointed in their stead.
|                         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|107.                     | The Chairman
  of the Board shall preside at and manage the proceedings at meeting of the
  Board. If the Chairman of the Board is absent from a meeting of the Board in
  accordance with advance notice given by him, or if he is not present at the
  meeting within 15 minutes from the time fixed for the meeting, then the
  Vice-Chairman of the Board (if appointed) shall preside at the meeting. In
  the absence from the meeting of both the Chairman and Vice-Chairmen of the
  Board, the Board members present shall elect one of their number as chairman
  of the meeting.                                                                                                                                                                          
|                         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|108.                     | The Board
  shall hold meetings in accordance with the needs of the Company and the
  provisions of The Companies Law.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               

23

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|     |                                                                                                                                                                                                                         |                                                                                                                                                                                                
|---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|109. | The Chairman
  is authorized to convene the Board at any time and to determine the place and
  time of any Board meeting.                                                                                              
|     |                                                                                                                                                                                                                        
|110. | Without
  derogating from the aforesaid, the Chairman is obliged to convene the Board
  in any of the following instances:                                                                                             
|     |                                                                                                                                                                                                                        
|     | 110.1                                                                                                                                                                                                                   | On receipt
  of a demand from at least two directors for the convention of the Board, for
  discussion of the matter detailed in such demand;                                                  
|     |                                                                                                                                                                                                                         |                                                                                                                                                                                                
|     | 110.2                                                                                                                                                                                                                   | On receipt
  of a notice or report from the General Manager which necessitates an action
  by the Board;                                                                                       
|     |                                                                                                                                                                                                                         |                                                                                                                                                                                                
|     | 110.3                                                                                                                                                                                                                   | On receipt
  of a notice from the auditor as to material defects in the bookkeeping of the
  Company.                                                                                          
|     |                                                                                                                                                                                                                         |                                                                                                                                                                                                
|     | Upon receipt
  of such a notice or demand as above, the Chairman shall convene the Board,
  without delay, and not later than within 14 days of the date of the demand,
  notice or report, as the case may be.        
|     |                                                                                                                                                                                                                        
|111. |                                                                                                                                                                                                                         |                                                                                                                                                                                                
|     |                                                                                                                                                                                                                         |                                                                                                                                                                                                
|     | 111.1                                                                                                                                                                                                                   | Prior notice
  of the convening of the Board shall be given to all members of the Board
  reasonably (considering the circumstances and the urgency of the matter) in
  advance of the meeting.
|     |                                                                                                                                                                                                                         |                                                                                                                                                                                                
|     | 111.2                                                                                                                                                                                                                   | Notwithstanding
  the aforesaid, with the consent of all the directors, the Board may hold a
  meeting without notice.                                                                         
|     |                                                                                                                                                                                                                         |                                                                                                                                                                                                
|112. | The agenda
  of Board meetings (Hereinafter - The Agenda) shall be determined by the
  Chairman, and shall include:                                                                                                  
|     |                                                                                                                                                                                                                        
|     | 112.1                                                                                                                                                                                                                   | Matters
  determined by the Chairman;                                                                                                                                                          
|     |                                                                                                                                                                                                                         |                                                                                                                                                                                                
|     | 112.2                                                                                                                                                                                                                   | Matters
  fixed in accordance with Article 110 above;                                                                                                                                          
|     |                                                                                                                                                                                                                         |                                                                                                                                                                                                
|     | 112.3                                                                                                                                                                                                                   | Any matter
  which a director or the General Manager may, reasonably in advance of the
  convening of a Board meeting, request the Chairman to include on the agenda.                          
|     |                                                                                                                                                                                                                         |                                                                                                                                                                                                
|     |                                                                                                                                                                                                                         |                                                                                                                                                                                                
|113. | The notice
  convening the Board, may be given in writing or orally, and shall include the
  time and place at which the meeting is to be held and reasonable details as
  to the matters on the agenda of the meeting.
|     |                                                                                                                                                                                                                        
|114. | Notice of a
  meeting of the Board shall be delivered to the address of the director
  furnished to the Company unless the director has requested or agreed that the
  notice be delivered to him at another address.  
|     |                                                                                                                                                                                                                        
|115. | The quorum
  for commencing a meeting of the Board shall be three members of the Board
  officiating at the time of the meeting, in person or by their substitute.                                                     

24

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|                    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                
|------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|116.                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                
|                    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                
|                    | 116.1                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | Each
  director shall have one vote on a poll of the Board. Resolutions of the Board
  shall be carried by a majority of the votes of the directors present and
  voting at the meeting without taking abstention votes into account. The
  Chairman of the Board shall not have an additional or casting vote.
|                    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                
|                    | 116.2                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | In the event
  of an equality of votes, the resolution voted upon shall be deemed to have
  been rejected.                                                                                                                                                                                                     
|                    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                
|117.                | The Board
  may hold its meetings by the use of any means of communication provided that
  all the directors can hear one another at the same time. The Board may
  determine the mode and methods for conducting a meeting by means of
  communication.                                                                                                                                                                                                                                                                                 
|                    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|118.                | The Board is
  authorized to adopt resolutions even without actually holding a meeting, provided
  that all the directors entitled to participate in the proceedings and to vote
  on the matter, have so consented. The provisions of Article 116 above subject
  to the changes required by the context, shall apply to such a resolution. A
  resolution carried in accordance with this Article shall be valid for all
  intents and purposes, as though it had been carried at a duly convened and
  conducted meeting of the Board.
|                    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|Minutes            
|                   
|119.                | The
  directors shall cause minutes of the proceedings at meetings of the Board to
  be kept; The minutes shall filed in registers kept for such purpose and,
  inter alia, shall include the names of directors participating and the names
  of other persons present at each meeting, the matters discussed at the
  meetings and the resolutions carried. Minutes signed by the Chairman of the
  Board or the Chairman of the meeting, as the case may be, shall constitute
  prima facie evidence as to the contents thereof.      
|                    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|120.                | The
  provisions of Article 118 above shall apply also with regard to the meetings
  of every Committee of the Board and with regard to the carrying of
  resolutions by the Board without meeting as in Article 117 above.                                                                                                                                                                                                                                                                                                              
|                    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|The General Manager
|                   
|121.                | The
  appointment and dismissal of the General Manager shall be made by the Board. The
  Board may appoint more than one General Manager.                                                                                                                                                                                                                                                                                                                                                                                                
|                    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|122.                | The General
  Manager is not bound to be a shareholder of the Company or a director.                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|                    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|123.                | The General
  Manager shall be responsible for the current management of the affairs of the
  Company within the framework of the policy determined by the Board and
  subject to the directives of the Board.                                                                                                                                                                                                                                                                                                                           
|                    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|124.                | The General
  Manager shall have all the management and executive powers which are not
  conferred by law or by or in accordance with these Articles on any other
  organ of the                                                                                                                                                                                                                                                                                                                                                         

25

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|                                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                 
|------------------------------------------------ | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                 | Company,
  with the exception of such powers, if any, as may be transferred from the
  General Manager to the Board in accordance with the provisions of Article
  96.1 above.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|                                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|125.                                             | The General
  Manager shall be subject to the supervision of the Board.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|                                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|126.                                             | Subject to
  the provisions of the Companies Law and to the provisions of these Articles,
  the Board may, from time to time, at its discretion give to and confer upon
  the General Manager any of the powers of the Board in accordance with these
  Articles, and may confer such powers for such period, for such purposes, upon
  such terms and with such limitations as the Board may deem fit, and the Board
  may also confer such powers, either with or without waiving its own powers in
  such matter or in place and instead of them, in whole or in part, and may
  from time to time annul, rescind and change such powers, in whole or in part.
|                                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|127.                                             | The General
  Manager may, with the approval of the Board, delegate his powers to another
  person or persons under his authority; Such approval may be either general or
  with regard to a specific matter.                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|                                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|128.                                             | Without
  derogating from the provisions of the Companies Law or from any other law,
  the General Manager shall submit to the Board reports on such matters, at
  such times and to such extent as may be required by the Board, either by a
  specific resolution or within the framework of the procedures of the Board.                                                                                                                                                                                                                                                                                                                                      
|                                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|129.                                             | The
  remuneration of the General Manager may be paid by way of salary or by
  commission or participation in profits or by the grant of or right to
  purchase securities, or in any other manner.                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|                                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|Validity of Actions and Approval of Transactions
|                                                
|130.                                             | Subject to
  the provisions of any law, all actions of the Board or of a Committee of the
  Board or of any person acting as a director or as a member of a Committee of
  the Board or of the General Manager, as the case may be - shall be valid even
  though it may subsequently transpire that there was some defect in the
  appointment of the Board, of the Committee of the Board, of the director who
  is a committee member or of the General Manager, as the case may be, or that
  any of the said officials was not qualified to hold office.                                                                                                    
|                                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|131.                                             | Subject to
  the provisions of the Companies Law:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|                                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|                                                 | 131.1.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | A person
  shall not be disqualified from being an officer of the Company, because of
  his being an officer of or having an interest in another corporation,
  including a corporation in which the Company is an interested party, or being
  a shareholder of, or as a result of the entering into a contract with the
  Company, in any matter and in any manner whatsoever, by himself or by such a
  corporation as above.
|                                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                 
|                                                 | 131.2.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | The fact
  that a person is an officer of the Company shall not disqualify him and/or a
  relative of his and/or a corporation in which he is any interest,                                                                                                                                                                                                                                                                     

26

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|                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                
|---------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | from
  entering into an agreement with the Company in respect of any transactions in
  which the officer has any personal interest.                                            
|                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                
|                                   | 131.3.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | An officer
  of the Company shall be entitled to participate in the deliberations and vote
  with regard to the approval of transactions in which he has a personal
  interest.
|                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                
|132.                               | Subject to
  the provisions of the Companies Law, a transaction of the Company with an
  officer of the Company or with a controlling shareholder, or a transaction of
  the Company with a third party in which an officer of the Company or a
  controlling shareholder has a personal interest, and which are not out of the
  ordinary course of business, shall be approved by the Board or by the Audit
  Committee or by such other organ empowered by the Board for such purpose.
  Such approval may be for a specific transaction or general with regard to a
  specific type of transaction. Such empowerment may be general to all types of
  transaction or with regard to a specific type of transaction.
|                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|133.                               | Subject to
  the provisions of the Companies Law, a general notification given to the
  Board by an officer or by a controlling shareholder, with regard to a
  personal interest in any particular body, detailing such personal interest,
  shall constitute a disclosure by the officer or controlling shareholder to
  the Company of his personal interest as aforesaid, for the purpose of a
  transaction between the Company and such body.                                                                                                                                                                                                                                                                    
|                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|Signature on behalf of the Company
|                                  
|134.                               | Subject to
  the provisions of the Companies Law and of these Articles, the Board may
  authorize any person to sign on behalf of the Company, and determine the
  manner of the Companys signature through any such authorized signatory,
  whether on his own or jointly with any other authorized signatory, whether
  generally or with regard to specific matters.                                                                                                                                                                                                                                                                                                                                               
|                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|135.                               | Every
  signature of the Company on any document shall include the name of the
  Company, in addition to the signature of authorized signatories as required
  by the determination of the Board.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|Appointment of Attorneys          
|                                  
|136.                               | Subject to
  the provisions of the Companies Law, the Board may at any time grant a Power
  of Attorney to any person to act as attorney of the Company for such
  purposes, with such powers and discretion, for such period and subject to
  such conditions, all the aforesaid as the Board, or the person authorized for
  this purpose by the Board, may determine.                                                                                                                                                                                                                                                                                                                                               

27

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Exemption, Indemnity and Insurance

|     |                                                                                                                                                                                                                                                                                                       
|---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|137. | Subject to
  the provisions of the Companies Law, the Company may exempt, in advance or
  retroactively, any officer of the Company from liability, in whole or in
  part, in respect of damage resulting from a breach of his/her duty of care to
  the Company.                                     
|     |                                                                                                                                                                                                                                                                                                       
|138. | Subject to
  the provisions of the Companies Law, the Company may insure the liability of
  any officer of the Company in respect of liability which may be imposed him
  as a result of any act carried out by him in his capacity as an officer of
  the Company, in any of the following instances:

| |        |                                                                                                                                                                                            
| | ------ | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | 138.1. | Breach of a
  duty of care to the Company or to any other person;                                                                                                                          
| |        |                                                                                                                                                                                            
| | 138.2. | Breach of a
  duty of trust to the Company provided that the officer acted bona fide and had
  reasonable grounds for believing that the act would not harm the interests of
  the Company;
| |        |                                                                                                                                                                                            
| | 138.3. | A monetary
  liability imposed upon the officer in favor of a third party;                                                                                                                 
| |        |                                                                                                                                                                                            
| | 138.4. | Any other
  event in respect of which insurance of an officer is permitted and/or may be
  permitted.                                                                                      

|     |                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|---- | ----------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|139. | Subject to
  the provisions of the Companies Law -                                                                                             
|     |                                                                                                                                                
|     | 139.1.                                                                                                                                          | The Company
  may undertake in advance to indemnify an officer of the Company in respect of
  a liability or expense as detailed in Article 140 hereinafter, which may be
  imposed upon him/her as a result of an act carried out by him/her in his
  capacity as an officer of the Company, provided that such undertaking is
  limited to the kinds of events which in the opinion of the Board are
  foreseeable at the time of the issue of the undertaking and is limited to the
  amount fixed by the Board as reasonable in the circumstances of the matter
  (hereinafter - The Indemnity Undertaking).
|     |                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|     | 139.2.                                                                                                                                          | Without
  derogating from the aforesaid in Article 139.1 above, the Company may
  indemnify an officer of the Company retroactively in respect of a liability
  or expense as detailed in Article 140 hereinafter, imposed upon him/her as a
  result of an act carried out by him/her in his capacity as an officer of the
  Company.                                                                                                                                                                                                                                                                            
|     |                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|140. | An indemnity
  undertaking or an indemnity, as aforesaid in Article 139 above, may be issued
  in respect of a liability or expense as follows:
|     |                                                                                                                                                
|     | 140.1.                                                                                                                                          | A monetary
  liability imposed upon the officer in favor of a third party pursuant to a
  judgment, including a judgment by way of compromise or a judgment of an
  arbitrator approved by a court;                                                                                                                                                                                                                                                                                                                                                                                                               

28

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|     |                                                    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|---- | -------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|     | 140.2.                                             | Reasonable
  expenses of the proceedings, including lawyers fees, expended by the officer
  or imposed upon him/her by the court, in proceedings issued against him/her
  by or on behalf of the Company or by a third party, or with regard to
  criminal proceedings from which the officer was acquitted or criminal
  proceedings in which he was convicted but which do not require proof of a
  criminal intention;                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|     |                                                    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|     | 140.3.                                             | Any other
  liability or expense in respect of which it is or may be permissible to
  indemnify an officer.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|     |                                                    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|141. | Subject to
  the provisions of the Companies Law -
|     |                                                    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|     | 14.1.1.                                            | The Company
may issue an undertaking in advance to indemnify any person, including an
officer of the Company, who officiates or officiated on behalf of or at the
request of the Company as a director of another company of which the Company,
directly or indirectly, is a shareholder, or in which the Company has any
interest whatsoever (hereinafter - A Director of the other Company), in
respect of a liability or expense as detailed in Article 140 above, which may
be imposed upon him/her as a result of an act carried out by him/her in his
capacity as a Director of the other Company, provided that such undertaking
is limited to the kinds of events which in the opinion of the Board are
foreseeable at the time of the issue of the undertaking and is limited to the
amount fixed by the Board as reasonable in the circumstances of the matter.
|     |                                                    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|     | 14.1.2.                                            | Without
  derogating from the aforesaid in Article 141.1 above, the Company may
  indemnify a Director of the other Company retroactively in respect of a
  liability or expense as detailed in Article 140 above, imposed upon him/her
  as a result of an act carried out by him/her in his capacity as a Director of
  the other Company.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|     |                                                    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|     | 14.1.3.                                            | The
  aggregate indemnification amount that the Company shall pay to its Officers
  (in addition to sums that may be received from insurance companies in
  connection to insurance policies that the Company has purchased) pursuant to
  all the letters of indemnification that shall be issued by the Company
  pursuant to the indemnification decision, in connection to one or more of the
  types of events to be approved, shall not exceed 25% of the shareholders
  equity (in US $) of the Company according to the consolidated financial
  statements of the Company dated December 31, 2000.                                                                                                                                                                                                                                                                
|     |                                                    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|142. | Subject to
  the provisions of the Companies Law -
|     |                                                    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|     | 142.1.                                             | The Company
  may indemnify every employee or clerk of the Company who is not an officer of
  the Company retroactively, in respect of any liability or expense paid or
  imposed upon him/her in his capacity as an employee or clerk of the Company
  in any legal proceedings, due to an act                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            

29

---



|                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                                                                                                                                      
|-------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | carried out
  by him/her bona fide in his/her capacity as employee or clerk of the Company,
  excluding a criminal indictment in which the he/she was convicted in an
  offense which require proof of a criminal intention and the convicting judgment
  was not canceled in an appeal or it can not be issued for an appeal;                                                                                       
|                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                                                                                                                                      
|                                                               | 142.2.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | The company
  may issue an undertaking in advance to indemnify an employee or clerk of the
  Company, who is not an officer of the Company, or to indemnify him/her
  retroactively in respect of any monetary liability imposed or will be
  imposed, upon him/her in favor of any third party in respect of an act
  carried out by him/her bona fide in his/her capacity as an employee or clerk
  of the Company.
|                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                                                                                                                                      
|143.                                                           | Subject to
  the provisions of the Companies Law, nothing in these Articles shall limit
  the Company, in any manner whatsoever, in entering into an agreement of
  liability insurance, or to the grant of exemption or indemnification:                                                                                                                                                                                                                                                                                                                                                                              
|                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                                                                                                                                      
|                                                               | 143.1.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | In respect
  of an officer of the Company or a director of the other company, to the
  extent that the insurance, the exemption or the indemnity are not forbidden
  by law.                                                                                                                                                                                                                                         
|                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                                                                                                                                      
|                                                               | 143.2.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | In respect
  of any person who is not an officer of the Company or a director of the other
  company, including but without derogating from the generality of the
  aforesaid, employees, contractors or consultants.                                                                                                                                                                                                
|                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                                                                                                                                      
|Dividends, Reserve Funds and Capitalization
  of Reserve Funds
|                                                              
|144.                                                           | The Company
  may, before deciding on the distribution of a dividend as in Article 145
  hereinafter, set aside some sums of the profits, to a general fund or a
  reserve fund for the distribution of dividends, distribution of bonus shares
  or any other purpose, as the Board may at its discretion determine.                                                                                                                                                                                                                                                                                                  
|                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                                                                                                                                      
|145.                                                           | Until use is
  made of the said funds, the Company is authorized to invest the monies set
  aside as aforesaid and the monies of the funds, in any investment, to manage
  such investments, to vary them or otherwise to use them, and it may divide
  the reserve fund into special funds and to use each fund or part thereof for
  the purpose of the business of the Company, without holding the same distinct
  from the other assets of the Company, all the aforesaid at the discretion of
  the Board or a person designated for that purpose by the Board, and upon such
  terms as the Board may determine.
|                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                                                                                                                                      
|146.                                                           | Subject to
  the provisions of the Companies Law, the Company may distribute dividends, as
  the Board may resolve. The Board may decide that the dividend shall be paid,
  in whole or in part, in cash or by way of the distribution of assets in
  specie, including securities, or in any other manner at the discretion of the
  Board.                                                                                                                                                                                                                                                                           
|                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                                                                                                                                      
|147.                                                           | 147.1                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   | Subject to
  the provisions of the Companies Law, the Company may allot bonus shares, as
  the Board may decide, subject to the conversion of part of the profits of the
  Company, within the meaning of section 302(b) of the                                                                                                                                                                                      

30

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|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                          
|---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | Companies
  Law, into share capital, from a premium of shares or from any other source
  included in the shareholders equity of the Company as stated in the last
  Financial Statements of the Company, in such amount as may be determined by
  the Board and which shall not be less than the par value of the bonus shares.          
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                          
|     | 147.2                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | When
  deciding on the allotment of bonus shares, the Board shall determine whether
  the bonus shares shall be of one class to all shareholders notwithstanding
  the classes of shares held by them, or that each such shareholder shall
  receive bonus shares of the same class in respect of each class of shares
  held by him/her.
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                          
|     | 147.3                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | Bonus shares
  allotted in accordance with this Article shall be deemed fully paid up.                                                                                                                                                                                                                                                   
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                          
|148. | When
  deciding upon the allotment of bonus shares, the Board may decide that the
  Company shall transfer to a special fund designated for the distribution of
  bonus shares in the future, such sum as the conversion thereof to share
  capital shall be sufficient to allot to any person who is at such time
  entitled for any reason whatsoever to purchase shares in the Company
  (including an entitlement which can only be realized at a subsequent date),
  those bonus shares to which such person would have been entitled had he
  realized his entitlement to purchase such shares prior to the date
  determining the right to receive the bonus shares (in this Article - The Determining Date). If subsequent to
  the determining date, such person shall realize his entitlement to purchase
  the shares or part of them, the Company shall allot to him/her those bonus
  shares of a par value which he would have received had he realized, prior to
  the determining date, his entitlement to purchase those share which he
  actually did purchase, the aforesaid by converting to share capital an
  appropriate part of the aforesaid special fund. Bonus shares shall entitle
  the holders thereof to participate in the distribution of cash dividends or
  bonus shares commencing at such time as is fixed by the Board. For the
  purpose of fixing the amount to be appropriated to the aforesaid special
  fund, any amount appropriated to the fund in respect of previous
  distributions of bonus shares, shall be deemed as though it had already been
  capitalized and there had been allotted therefrom shares entitling the
  persons entitled to purchase shares, to the bonus shares.
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                          
|149. | Subject to
  the rights assigned to the classes of shares issued by the Company and to the
  provisions of these Articles, a dividend or bonus shares shall be distributed
  between the shareholders proportionately to the par value of each share
  without taking into consideration any premium paid for such share.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                          
|150. | In order to
  carry out any resolution for the distribution of a dividend or for the
  allotment of bonus shares, the Board is authorized:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                          
|     | 150.1.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | To settle as
  it may deem fit any difficulty which may arise and to take such steps as it
  may deem necessary in order to overcome the difficulty.                                                                                                                                                                                     
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                          
|     | 150.2.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | To decide
  that fractions or fractions less than an amount fixed by the Board, shall not
  be taken into account in order to adjust the entitlement of the                                                                                                                                                                              

31

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|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|---- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | shareholders
  or to decide on the sale of fractions of shares and the distribution of the
  net proceeds between the persons entitled thereto.                                                                                                                                                                                                                                                                                                                                                                                                                                                
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|     | 150.3.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | To authorize
  signature on behalf of the shareholders of any agreement or other document
  which may be required in order to give effect to the allotment and/or
  distribution, and in particular to authorize the signature and lodging for
  registration of a document in writing in accordance with section 291 of the
  Companies Law.                                                                                                                                                                                                                                                  
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|     | 150.4.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | To determine
  the value of certain assets to be distributed and to decide that payments in
  cash shall be paid to the shareholders on the basis of the valuation so
  determined.                                                                                                                                                                                                                                                                                                                                                                                                            
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|     | 150.5.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | To vest
  monies or specific assets in trustees for the persons entitled thereto, as
  the Board may deem expedient.                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|     | 150.6.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | To make any
  other arrangement or settlement as may in the opinion of the Board be
  required in order to enable the allotment or the distribution, as the case
  may be.                                                                                                                                                                                                                                                                                                                                                                                                                     
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|151. | 151.1                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | Dividends or
  other benefits in respect of shares shall not bear interest.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|     | 151.2                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | As long as
  amounts of dividends resolved to be distributed have not yet been collected
  by the persons entitled thereto, the Company may use them for its purposes
  without any limitation and it shall not be bound to deposit the same in a
  trust account or in any yield bearing account or to segregate them in any
  other manner, and the Company shall not be considered as a trustee in respect
  thereof. The Company may forfeit any amount of dividend not collected by the
  person entitled thereto by the end of seven years from the date fixed for the
  payment thereof.
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|152. | The Company
  may withhold any dividend or bonus shares or other benefit rights in respect
  of shares the consideration for which, in whole or in part, has not been paid
  to the Company at the date set for it, and to collect any such amount as
  aforesaid or consideration received from the sale of the bonus shares or
  other benefit rights, on account of the debts in respect of the said shares,
  the aforesaid whether the said shares are solely owned by the shareholder in
  debt or whether the shares are owned jointly with other shareholders.
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|153. | The Company
  may withhold any dividend or bonus shares or other rights in respect of
  shares of which a person is entitled to be registered as owner thereof in the
  Register or which he is entitled to transfer, in accordance with Article 31
  above, until such person is registered as the owner thereof or until he shall
  duly transfer them, as the case may be.                                                                                                                                                                                         
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|154. | The Board
  may, from time to time, decide upon the mode of payment of dividends or
  allotment of bonus shares or transfer thereof to the persons entitled thereto
  and may also determine instructions, procedures and arrangements relating
  thereto, both with regard to the registered shareholders and also with regard
  to unregistered shareholders. Without derogating from the generality of the
  aforesaid, the board may determine as follows:                                                                                                        

32

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|                     |                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|-------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                     | 154.1.                                                                                                                                                                                                                                                        | Subject to
  the provisions of 154.2 and 154.3 hereafter, any dividend or monies to be
  distributed to a registered shareholder, shall be paid by posting a check to
  his address as registered in the Shareholders Register, or in the case of
  jointly registered shareholders, to the person whose name appears first in
  the Shareholders Register with regard to such shares. The posting of any
  check as aforesaid shall be at the risk of the registered shareholder.
|                     |                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|                     | 154.2.                                                                                                                                                                                                                                                        | Dividend
  which amount to less than a specific amount fixed by the Board, shall not be
  sent by check as aforesaid and the provisions of 154.3 hereinafter shall apply
  thereto.                                                                                                                                                                                                                                                                                               
|                     |                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|                     | 154.3.                                                                                                                                                                                                                                                        | Payment of a
  dividend or monies to be distributed to registered shareholders shall be
  effected at the Office or at such other place as the Board may fix.                                                                                                                                                                                                                                                                                                                     
|                     |                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|                     | 154.4                                                                                                                                                                                                                                                         | Any dividend
  distributed to unregistered shareholders shall be transferred to such
  shareholders by means of the Nominee Company or in such other manner as the
  Board may determine.                                                                                                                                                                                                                                                                                         
|                     |                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|155.                 | If two or
  more persons are registered in the Register as joint owners of any share,
  each of them is entitled to give a valid receipt in respect of any dividend,
  share or other security, or other monies or rights payable in respect of such
  share.
|                     |                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|Company Documents   
|                     |                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|156.                 |                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|                     |                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|                     | 156.1.                                                                                                                                                                                                                                                        | Shareholders
  shall not have a right to peruse the documents of the Company or any of them,
  unless such right has been conferred upon them by any legislation or
  regulation in the circumstances determined for such purpose.                                                                                                                                                                                                                                                
|                     |                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|                     | 156.2                                                                                                                                                                                                                                                         | Without
  derogating from the aforesaid in Article 156.1 above, the Board may, at its
  discretion, permit the perusal of the documents of the Company, or any of
  them, also to shareholders or any of them, as it may at its discretion deem
  fit.                                                                                                                                                                                                                            
|                     |                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|157.                 | Subject to
  the provisions of any Law, any book, list or Register which the Company is,
  by law or by these Articles, bound to maintain, shall be kept by such
  technical, mechanical or other means as may be decided by the Board.                      
|                     |                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|Financial Statements
|                     |                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|158.                 | The
  Financial Statements of the Company shall be signed by the persons authorized
  by the Board for such purpose, as required by law.                                                                                                                     

Auditors

33

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|        |                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|159.    | An
  accountant auditor or accountant auditors shall be appointed at every Annual
  Meeting and shall officiate until the closing of the following Annual
  Meeting.                                                                                                                                                                                                            
|        |                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|160.    |                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|        |                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|        | 160.1                                                                                                                                                                                                                                                                                                                                                                            | The Board
  shall at its discretion determine the auditing fees of the accountant auditor
  appointed.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|        |                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|        | 160.2                                                                                                                                                                                                                                                                                                                                                                            | Fees of the
  accountant auditor in respect of additional services to the Company which are
  not audit acts, shall be determined by the Board at its discretion.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|        |                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|Notices
|        |                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|161.    | The giving
  of notices or service of documents to shareholders and to the Nominee
  Company, in accordance with the provisions of the Companies Law or of these
  Articles, shall be effected in one of the manners referred to in this
  Chapter.                                                                                                                             
|        |                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|162.    | Notice of
  General Meeting shall be served as in Article 56 above.                                                                                                                                                                                                                                                                                                             
|        |                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|163.    | 163.1                                                                                                                                                                                                                                                                                                                                                                            | Without
  derogating from the aforesaid, the Company may serve a shareholder with any
  notice or document, by delivery by hand or by facsimile or by dispatch by
  post or by email. Dispatch by post shall be to the last address of the
  shareholder registered in the Companys Register, or if no such address is
  registered, to such address as may have been furnished by him/her to the
  Company for the purpose of sending notices to him. Notice delivered by
  facsimile shall be delivered to the shareholder to the number given by
  him/her to the Company. Notice delivered by email shall be delivered to the
  shareholder to the address given by him/her to the Company.
|        |                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|        | 163.2.                                                                                                                                                                                                                                                                                                                                                                           | A notice or
  document delivered by hand to a shareholder shall be deemed to have been
  served at such time as delivered by hand.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|        |                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|        | 163.3.                                                                                                                                                                                                                                                                                                                                                                           | A notice or
  document dispatched by post, shall be deemed to have been duly served, if
  handed in for dispatch at any post office when correctly addressed and
  properly stamped. Service shall be deemed to have been effected at such time
  as the letter is delivered by the post in the usual course and not later than
  two days from the date that the letter containing such notice was handed to the
  post office.                                                                                                                                                                                                                                                                
|        |                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|        | 163.4.                                                                                                                                                                                                                                                                                                                                                                           | A notice
  sent by facsimile or by email shall be deemed to have been served twenty four
  hours after dispatch.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|        |                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|164.    | Without
  derogating from the aforesaid, the Company may serve a notice to the
  shareholders by a single publication in two daily newspapers published in
  Israel in Hebrew, either in addition or in place of a notice as in Article
  163 above. The date of publication in the newspaper shall be deemed to be the
  date on which notice was received by the shareholders.

34

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|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | 
|---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | 
|165. | The Company
  may give notice as to service of a document at the office or at such other
  place as may be fixed by the Board or as to service in any other manner,
  including by means of internet.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | 
|166. | The Company
  may serve a notice or document to joint shareholders by the dispatch of the
  same to the shareholder whose name appears first in the Shareholders Register
  with regard to such share.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | 
|167. | The service
  of a notice or document to one member of a family residing together with the
  person for whom the notice or document is intended, shall be deemed as
  service of the same to the intended person.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | 
|168. | Any person
  who by operation of law, transfer or other means shall become entitled to any
  share, shall be bound by every notice in respect of such share which was duly
  given, prior to the entry of his details in the Register, to the person from
  whom he derives his title to such share.                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | 
|169. | Any notice
  or document given to a shareholder of the Company in accordance with the
  provisions of these Articles, shall be deemed to have been duly served
  notwithstanding the decease, bankruptcy or liquidation of such shareholder or
  the transmission of the right to the shares by law (whether or not the
  Company is aware of same), so long as no other person has been registered as
  owner of the shares in his place, and dispatch or delivery as aforesaid shall
  for all intents and purposes be deemed sufficient with regard to any person
  having an interest in such shares and/or entitled to them by virtue of transmission
  of the right by law, whether jointly with such shareholder or on his behalf
  or in his place.
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | 
|170. | Subject to
  the provisions of any Law, any shareholder, director or other person entitled
  to receive notice in accordance with these Articles or by the Companies Law,
  may waive receipt of same, either in advance or retroactively, either with
  regard to a specific instance or generally, and by his doing so, it shall be
  deemed as though the notice had been duly given, and any procedure or act in
  respect of which the notice was bound to be given, shall be deemed as valid
  and effective.                                                                                                                                                                                                                                        
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | 
|171. | A
  certificate in writing signed by a director or by the secretary of the
  Company with regard to the dispatch or giving of a notice in one of the
  manners detailed in these Articles, shall constitute conclusive evidence to
  the facts detailed in such certificate.                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | 
|172. | When prior
  notice of a given number of days or a notice effective for a specific period
  is required to be given, the day of service shall, unless otherwise
  determined, be counted in the number of days or the specific period. If
  notice is given in more than one of the manners detailed above, it shall be
  deemed to have been given at the earliest of the times at which it is deemed
  to have been served, as aforesaid.                                                                                                                                                                                                                                                                                                                
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | 
|     | An
  accidental omission in giving notice of a general meeting to any shareholder
  or non-receipt of notice of a meeting or any other notice by a shareholder
  shall not cause the cancellation of a resolution passed at such meeting or
  cancellation of proceedings based on such notice.                                                                                                                                                                                                                                                                                                                                                                                                                                                            

35

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|           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | 
|---------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | 
|Merger    
|           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | 
|173.       | Approval of
  merger as provided in section 327 of the Companies Law, is subject to a
  simple majority at the General Meeting or Class Meeting, as the case may be,
  all the aforesaid subject to the provisions of any law.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | 
|Winding Up
|           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | 
|174.       | Subject to
  the provisions of any law, the liquidator, whether on voluntary or other
  liquidation, may in accordance with a resolution of a General Meeting carried
  by a special majority, distribute between the shareholders in specie, the
  excess assets, in whole or in part, and may in accordance with a resolution
  of a General Meeting carried by a special majority, vest any part of the
  excess assets in trustees upon such trust for the shareholders as the liquidator
  may deem fit. For the purpose of the distribution of the excess assets in
  specie, the liquidator may determine the proper value of the assets available
  for distribution and determine how the distribution between the shareholders
  will be carried out taking into consideration the rights of the various
  classes of shares of the Company owned by them.

36

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Articles of Association of

Elron
Electronic Industries Ltd.

Table of Contents

|    |                                                                |          |         |       |  |       | 
|--- | -------------------------------------------------------------- | -------- | ------- | ----- |  | ----- | 
|    |                                                                | Sections |         | Pages | 
|    |                                                                |          |         |       | 
|1.  | Introduction                                                   |          | 1       |       |  | 1-3   | 
|2.  | Name of the
  Company                                          |          | 2       |       |  | 3     | 
|3.  | Limitation
  of Liability                                      |          | 3       |       |  | 3     | 
|4.  | Objects of
  the Company                                       |          | 4       |       |  | 3     | 
|5.  | Business                                                       |          | 5       |       |  | 3     | 
|6.  | Donations                                                      |          | 6       |       |  | 3-4   | 
|7.  | Registered
  Office                                            |          | 7       |       |  | 4     | 
|8.  | The Articles                                                   |          | 8-10    |       |  | 4     | 
|9.  | Registered
  Share Capital                                     |          | 11      |       |  | 4     | 
|10. | The Shares                                                     |          | 12-14   |       |  | 4-5   | 
|11. | Share
  Certificates                                           |          | 15-19   |       |  | 5-6   | 
|12. | Payments for
  Shares                                          |          | 20      |       |  | 6     | 
|13. | Forfeiture
  of Shares                                         |          | 21      |       |  | 6-7   | 
|14. | Transfer of
  Shares                                           |          | 22-33   |       |  | 7-8   | 
|15. | Alteration
  of the Share Capital                              |          | 34-37   |       |  | 8-9   | 
|16. | Modification
  of Rights                                       |          | 38-40   |       |  | 10    | 
|17. | Issuance of
  Shares and Other Securities                      |          | 41-44   |       |  | 10-11 | 
|18. | Redeemable
  Securities                                        |          | 45      |       |  | 11    | 
|19. | Registers                                                      |          | 46-48   |       |  | 11-12 | 
|20. | General
  Meetings                                             |          | 49-58   |       |  | 12-14 | 
|21. | Proceedings
  at General Meetings                              |          | 59-64   |       |  | 14-15 | 
|22. | Voting and
  Carrying of Resolutions at General Meetings       |          | 65-80   |       |  | 15-18 | 
|23. | The Board of
  Directors                                       |          | 81-92   |       |  | 18-20 | 
|24. | External
  Directors                                           |          | 93      |       |  | 20    | 
|25. | Powers and
  Duties of the Board                               |          | 94-98   |       |  | 20-22 | 
|26. | Receipt of
  Credit and the Grand of Guaranties and Securities |          | 99      |       |  | 22    | 
|27. | Committees
  of the Board                                      |          | 100-104 |       |  | 22-23 | 
|28. | Proceedings
  of the Board                                     |          | 105-118 |       |  | 23-25 | 
|29. | Minutes                                                        |          | 119-120 |       |  | 25    | 
|30. | The General
  Manager                                          |          | 121-129 |       |  | 25-26 | 

37

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|    |                                                                |  |         |  |  |       | 
|--- | -------------------------------------------------------------- |  | ------- |  |  | ----- | 
|31. | Validity of
  Articles and Approval of Transactions            |  | 130-133 |  |  | 26-27 | 
|32. | Signature on
  behalf of the Company                           |  | 134-135 |  |  | 27    | 
|33. | Appointment
  of Attorneys                                     |  | 136     |  |  | 27    | 
|34. | Exemption,
  Indemnity and Insurance                           |  | 137-143 |  |  | 28-30 | 
|35. | Dividends,
  Reserve Funds and Capitalization of Reserve Funds |  | 144-155 |  |  | 30-33 | 
|36. | Company
  Documents                                            |  | 156-157 |  |  | 33-34 | 
|37. | Financial
  Statements                                         |  | 158     |  |  | 33    | 
|38. | Auditors                                                       |  | 159-160 |  |  | 34    | 
|39. | Notices                                                        |  | 161-172 |  |  | 34-36 | 
|40. | Merger                                                         |  | 173     |  |  | 36    | 
|41. | Winding Up                                                     |  | 174     |  |  | 36    | 

38

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