<PAGE>
                                     BY-LAWS

                                       OF

                        AMPAL-AMERICAN ISRAEL CORPORATION


ARTICLE 1. OFFICES

         1.1.     Offices. The principal office of the corporation shall be
                  located in the City, County and State of New York; other
                  offices, either within or without the State of New York, shall
                  be at such place or places as the Board of Directors may from
                  time to time determine or the business of the corporation
                  requires.


ARTICLE 2. SHAREHOLDERS

         2.1.     Annual Meetings. Annual meetings of the shareholders for the
                  election of directors and for transaction of other business
                  shall be held at such time and on such date as shall be
                  designated by the Board of Directors, at the principal office
                  of the corporation in the State of New York or at such other
                  place within or without the State of New York as shall be
                  designated by the Board of Directors and specified in the
                  notice of each such meeting.

         2.2.     Special Meetings of Shareholders. Special meetings of the
                  shareholders may be held either within or without the State of
                  New York, at any time and place and for any purpose or
                  purposes, unless otherwise prescribed by law or by the
                  Certificate of Incorporation, and shall be called by the Chief
                  Executive Officer, President or Secretary or by any officer of
                  the corporation, by order of the Board of Directors, or upon
                  the request in writing of shareholders representing at least
                  25% of the voting power of the outstanding shares entitled to
                  vote. Such request shall state the purpose or purposes of the
                  proposed meeting.

         2.3.     Notice of Meetings. Notice of all meetings of shareholders
                  shall be in writing, shall state the place, date and hour of
                  the meeting and, except in the case of the annual meeting,
                  indicate that it is being issued by or at the direction of the
                  person or persons calling the meeting. Notice of any special
                  meeting shall also state the purpose or purposes for which the
                  meeting is called. If, at any meeting, action is proposed to
                  be taken which would, if taken, entitle shareholders
                  fulfilling the statutory requirements to receive payment for
                  their shares, the notice of such meeting shall include a
                  statement of that purpose and to that effect. A copy of the
                  notice of any meeting shall be given, personally or by mail,
                  not less than ten nor more than fifty days before the date of
                  the meeting to each shareholder entitled to vote at such
                  meeting. If mailed, such notice shall be deemed given when
                  deposited in the United States mail, with postage thereon
                  prepaid, directed to the shareholder at his
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                                      -2-


                  address as it appears on the record of shareholders, or, if he
                  shall have filed with the Secretary of the corporation a
                  written request that notices to him be mailed to some other
                  address, then directed to him at such other address.

         2.4.     Adjourned Meetings. The shareholders present at a meeting of
                  shareholders may adjourn the meeting despite the absence of a
                  quorum. Notice of any adjourned meeting of the shareholders
                  shall not be required, if the time and place to which the
                  meeting is adjourned are announced at the meeting at which the
                  adjournment is taken, but if after the adjournment the Board
                  of Directors fixes a new record date for the adjourned
                  meeting, notice of the adjourned meeting shall be given to
                  each shareholder of record on the new record date entitled to
                  notice.

         2.5.     Fixing Record Date. The Board of Directors may fix, in
                  advance, a date as the record date for the purpose of
                  determining the shareholders entitled to notice of or to vote
                  at any meeting of shareholders or any adjournment thereof, or
                  to express consent to or to dissent from any proposal without
                  a meeting, or for the purpose of determining shareholders
                  entitled to receive payment of any dividend or the allotment
                  of any rights, or for the purpose of any other action. Such
                  date shall be not more than fifty nor less than ten days
                  before the date of such meeting, nor more than fifty days
                  prior to any other action. If no record date is fixed, the
                  record date for the determination of shareholders entitled to
                  notice of or to vote at a meeting of shareholders shall be at
                  the close of the business day preceding the day on which
                  notice is given; the record date for determining shareholders
                  for any purpose other than that specified in the preceding
                  clause shall be at the close of business on the day on which
                  the resolution of the directors relating thereto is adopted.

         2.6.     Quorum. Except as otherwise provided by law, by the
                  Certificate of Incorporation, or by these By-Laws, the holders
                  of record of one-third of the shares entitled to vote at any
                  meeting of shareholders, present in person or by proxy shall
                  be necessary to constitute a quorum for the transaction of any
                  business. When a quorum is once present to organize a meeting
                  of shareholders, it is not broken by the subsequent withdrawal
                  of any of the shareholders.

         2.7.     Vote of Shareholders. Except as otherwise required by law, at
                  any meeting at which a quorum is present, all elections shall
                  be had and all questions decided by a plurality of the votes
                  cast by the shareholders so present in person or represented
                  by proxy or, in cases where any class of stock votes as a
                  class, by a plurality of the votes cast by the holders of such
                  class of stock so present in person or by proxy. All voting
                  shall be by voice vote unless the person presiding at the
                  shareholders' meeting shall direct that the vote be by written
                  ballot, or the owners and holders of not less than 20% of the
                  shares entitled to vote shall in writing demand that the vote
                  in question be by ballot.

         2.8.     Proxies. Every shareholder entitled to vote at a meeting of
                  the shareholders or to express consent or dissent without a
                  meeting may authorize another person to act for him by proxy.
                  Every proxy must be in writing and signed by the shareholder
                  or his attorney-in-fact, and no proxy shall be valid after the
                  expiration of eleven months from the date thereof, unless
                  otherwise provided
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                                      -3-


                  in the proxy. Every proxy shall be revocable at the pleasure
                  of the shareholder executing it,except as otherwise provided
                  by law.

         2.9.     List of Shareholders at Meetings. A list of shareholders as of
                  the record date, certified by the Secretary or other officer
                  responsible for its preparation or by the transfer agent,
                  shall be produced at any meeting of shareholders upon the
                  request thereat or prior thereto of any shareholder. If the
                  right to vote at any meeting is challenged, the inspectors of
                  election, if any, or person presiding thereat, shall require
                  such list of shareholders to be produced as evidence of the
                  right of the persons challenged to vote at such meeting, and
                  all persons who appear from such list to be shareholders
                  entitled to vote thereat may vote at such meeting.

         2.10.    Inspectors at Shareholders' Meeting. The Board of Directors,
                  in advance of any shareholders' meeting, may appoint one or
                  more inspectors to act at the meeting or any adjournment
                  thereof. If inspectors are not so appointed, the person
                  presiding at a shareholders' meeting may, and on the request
                  of any shareholder entitled to vote thereat shall, appoint one
                  or more inspectors. In case any person appointed fails to
                  appear or act, the vacancy may be filled by appointment made
                  by the Board in advance of the meeting or at the meeting by
                  the person presiding thereat. Each inspector, before entering
                  upon the discharge of his duties, shall take and sign an oath
                  faithfully to execute the duties of inspector at such meeting
                  with strict impartiality and according to the best of his
                  ability.

         2.11.    Waiver of Notice. Notice of a shareholders' meeting need not
                  be given to any shareholder who submits a signed waiver of
                  notice, in person or by proxy, whether before or after the
                  meeting. The attendance of any shareholder at a meeting, in
                  person or by proxy, without protesting prior to the conclusion
                  of the meeting the lack of notice of such meeting, shall
                  constitute a waiver of notice by him.

         2.12.    Written Consent of Shareholders Without a Meeting. Any
                  shareholder action required as permitted by law, the
                  Certificate of Incorporation or these By-Laws, to be taken by
                  vote may be taken without a meeting on written consent,
                  setting forth the action so taken, signed by the holders of
                  all outstanding shares entitled to vote thereon.


ARTICLE 3. DIRECTORS

         3.1.     Powers of the Board of Directors. Except as otherwise provided
                  by law, by the Certificate of Incorporation or by these
                  By-Laws, the property, business and affairs of the corporation
                  shall be managed by the Board of Directors (sometimes
                  hereinafter referred to as the "Board").

         3.2.     Number, Election, Tenure and Qualifications of Directors.
                  Until changed by amendment to these By-Laws or resolution of
                  the Board of Directors the number of directors shall be not
                  less than 3 nor more than 29 members, with the actual number
                  of members of the Board of Directors to be set from time to
                  time by resolution of the Board of Directors. Such an
                  amendment or
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                                      -4-


                  resolution shall require the affirmative vote of
                  a majority of the entire Board. Directors need not be
                  shareholders. Except as otherwise provided by law or these
                  By-Laws, the directors shall be elected at the annual meetings
                  of the shareholders, and each director shall hold office until
                  the next annual meeting of shareholders and until his
                  successor has been elected and qualified. No decrease in the
                  number of directors by amendment of these By-Laws shall
                  shorten the term of any incumbent director.

         3.3.     Newly Created Directorships and vacancies. Newly created
                  directorships resulting from an increase in the authorized
                  number of directors and vacancies occurring in the Board
                  through death, resignation or disqualification or for any
                  other reason, including the removal of directors without
                  cause, may be filled by the vote of a majority of the
                  directors then in office, although less than a quorum exists,
                  or by the shareholders, and the directors so chosen shall hold
                  office until the next annual meeting of shareholders and until
                  their successors shall be duly elected and qualified unless
                  sooner displaced.

         3.4.     Regular Meetings. Regular meetings of the Board of Directors
                  may be held without call or formal notice at such place either
                  within or without the State of New York, and at such times as
                  the Board may by vote from time to time determine. There shall
                  be a regular meeting of the Board of Directors which may be
                  held without call or formal notice immediately after and at
                  the same place as the annual meeting of the shareholders or
                  any special meeting of the shareholders at which a Board of
                  Directors is elected.

         3.5.     Special Meetings. Special meetings of the Board of Directors
                  may be held at any place within or without the State of New
                  York at any time when called by the Chief Executive Officer,
                  the President or Secretary or two or more directors, notice of
                  the time and place thereof being given to each director by
                  leaving such notice with him at his residence or usual place
                  of business or by mailing, cabling, telegraphing or telexing
                  it, prepaid, addressed to him at his post office address as it
                  appears on the books of the corporation, at least two days
                  before the meeting. Notice shall be deemed given when sent in
                  accordance with these By-Laws. Neither the call, notice nor
                  waiver of notice need specify the purpose of any special
                  meeting of the Board of Directors.

         3.6.     Quorum. One-third of the entire Board of Directors shall
                  constitute a quorum, but in no case less than two directors. A
                  majority of the directors present, whether or not a quorum
                  exists, may adjourn a meeting to another time and place
                  without further notice until a quorum shall attend.

         3.7.     Action by the Board of Directors. The vote of a majority of
                  the directors present at the time of the vote, if a quorum is
                  present at such time, shall be the act of the Board, except
                  where a larger vote is required by law, by the Certificate of
                  Incorporation or these By-Laws.

         3.8.     Compensation of Directors. The Board of Directors shall have
                  authority to fix the compensation of directors for services in
                  any capacity.
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                                      -5-


         3.9.     Resignation and Removal of Directors.

                  (a)      Any director may resign at any time by giving written
                           notice thereof to the Chief Executive Officer, the
                           President or to the Board of Directors, and such
                           resignation shall take effect at the time therein
                           specified without the necessity of further action by
                           the Board.

                  (b)      Any director elected by the holders of the Preferred
                           Stock of the corporation voting as a separate class
                           may be removed with or without cause by vote of the
                           holders of the class of stock electing such director
                           at a meeting. Any other director may be removed with
                           or without cause by vote of the shareholders at a
                           meeting or for cause by vote of the Board of
                           Directors at a meeting.

3.10. Interested Directors.

                  (a)      Unless previously disclosed or otherwise known, each
                           director of the corporation shall inform the Board or
                           the committee thereof considering any contract or
                           other transaction with any other corporation, firm,
                           association or entity if such director is a director
                           or officer of such other corporation, firm,
                           association or other entity or has a substantial
                           financial interest therein;

                  (b)      No contract or other transaction between the
                           corporation and one or more of its directors, or
                           between the corporation and any other corporation,
                           firm, association or other entity in which one or
                           more of its directors are directors or officers, or
                           have a substantial financial interest, shall be
                           either void or voidable for this reason alone or by
                           reason alone that such director or directors are
                           present at the meeting of the Board, or of a
                           committee thereof, which approves such contract or
                           transaction, or that his or their votes are counted
                           for such purpose:

                           (1)      If the material facts as to such director's
                                    interest and as to any such common
                                    directorship, officership or financial
                                    interest are disclosed in good faith or
                                    known to the Board or committee, and the
                                    Board or committee approves such contract or
                                    transaction by a vote sufficient for such
                                    purpose without counting the vote or votes
                                    of such interested director or directors or,
                                    if the votes of the disinterested directors
                                    are insufficient to constitute an act of the
                                    Board as provided by law, by unanimous vote
                                    of the disinterested directors; or

                           (2)      If the material facts as to such director's
                                    interest and as to any such common
                                    directorship, officership or financial
                                    interest are disclosed in good faith or
                                    known to the shareholders entitled to vote
                                    thereon, and such contract or transaction is
                                    approved by vote of such shareholders.

                           (3)      If there is no good faith disclosure of the
                                    material facts as to the director's interest
                                    in the contract or transaction and if there
                                    is no knowledge of such interest, or if the
                                    vote of such interested
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                                      -6-


                                    director was necessary for the approval of
                                    such contract or transaction at a meeting of
                                    the Board or committee at which it was
                                    approved, and the party or parties thereto
                                    shall establish affirmatively that the
                                    contract or transaction was fair and
                                    reasonable as to the corporation at the time
                                    it was approved by the Board or committee
                                    or the Shareholders.

                  (c)      Interested directors may be counted in determining
                           the presence of a quorum at a meeting of the Board or
                           of a committee which approves such contract or
                           transaction.

         3.11.    Waiver of Notice. Notice of a meeting need not be given to any
                  director who signed a waiver of notice whether before or after
                  the meeting, or who attends the meeting without protesting,
                  prior thereto or at its commencement, the lack of notice to
                  him.

         3.12.    The Entire Board of Directors. As used in there By-Laws the
                  term "the entire Board of Directors" or "the entire Board"
                  means the number of directors the Board would have if there
                  were no vacancies.

         3.13.    Participation at Meetings by Use of Communications Equipment.
                  Any one or more members of the Board of Directors or any
                  committee thereof may participate in a meeting of the Board of
                  Directors or a committee thereof by means of a conference
                  telephone or similar communications equipment allowing all
                  persons participating in the meeting to hear each other at the
                  same time. Participation by such means shall constitute
                  presence in person at a meeting.

         3.14.    Consent in Lieu of Meeting. Unless otherwise restricted by the
                  certificate of incorporation or these By-Laws, any action
                  required or permitted to be taken at any meeting of the Board
                  of Directors or of any committee thereof may be taken without
                  a meeting, if all members of the Board of Directors or
                  committee, as the case may be, consent in writing to the
                  adoption of a resolution authorizing the action and the
                  resolution and the written consents thereto are filed with the
                  minutes of the proceedings of the Board or committee.


ARTICLE 4. EXECUTIVE COMMITTEE AND OTHER COMMITTEES OF THE BOARD

         4.1.     How Constituted and Powers. The Board of Directors, by
                  resolution adopted by a majority of the entire Board, may
                  designate from among its members an Executive Committee and
                  other committees, each consisting of three or more directors.
                  No such committee shall have authority as to the following
                  matters:

                  (1) The submission to shareholders of any action that needs
                  shareholders' authorization by law.

                  (2) The filling of vacancies in the Board of Directors or in
                  any committee.
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                                      -7-


                  (3) The fixing of compensation of the directors for serving on
                  the Board or on any committee.

                  (4) The amendment or repeal of By-Laws, or the adoption of new
                  By-Laws.

                  (5) The amendment or repeal of any resolution of the Board
                  which by its terms shall not be so amendable or repealable.

                  Except as provided above and except to the extent the Board,
                  by resolution, withholds from or denies to the Executive
                  Committee any power or authority, the Executive Committee
                  shall have all the authority of the Board of Directors. Except
                  as provided above, each other committee designated by the
                  Board of Directors shall have such authority as is
                  specifically delegated to it by resolution of the Board of
                  Directors.

         4.2.     Alternate Committee Members. The Board may designate one or
                  more directors as alternate members of any committee
                  established under this Article, who may replace any absent
                  member or members at any meeting of such committee.

         4.3.     Organization, etc. The Executive Committee (or other committee
                  established under this Article) may choose its own Chairman
                  and Secretary and shall keep minutes of all of its acts and
                  proceedings and report the same from time to time to the Board
                  of Directors.

         4.4.     Meetings. Regular meetings of the Executive Committee (or
                  other committee established under this Article), of
                  which no notice shall be necessary, shall be held at such
                  times and in such places as shall be fixed by a majority of
                  the Committee. Special meetings of the Committee shall be
                  called at the request of any member of the Committee. Notice
                  of each special meeting of the Committee shall be sent by
                  mail, telegraph, cable or wireless or telephone not later than
                  the day before the date on which the meeting is to be held.
                  Notice of any such meeting need not be given to any member of
                  the Committee, however, if waived by him in writing or by
                  telegraph, cable or wireless, before or after the meeting; and
                  any meeting of the Committee shall be a legal meeting without
                  notice thereof having been given, if all the members of the
                  Committee shall be present thereat.

         4.5.     Quorum and Manner of Acting. A majority of the Executive
                  Committee (or other committee established under this Article),
                  shall constitute a quorum for the transaction of business, and
                  the act of a majority of those present at the meeting at which
                  a quorum is present shall be the act of the Executive
                  Committee.

         4.6.     General. Each committee established by the Board of Directors
                  shall serve at the pleasure of the Board of Directors, which
                  may fill vacancies in any such committee.
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                                      -8-


ARTICLE 5. OFFICERS

         5.1.     Authorized Officers. The officers of the corporation shall be
                  a Chairman of the Board of Directors, a Chief Executive
                  Officer, a President, one or more Vice-Presidents, a
                  Secretary, a Treasurer and a Controller, and such other
                  officers, including one or more Assistant Vice-Presidents,
                  Assistant Secretaries, Assistant Treasurers and Assistant
                  Controllers, as the Board may from time to time determine as
                  the business of the corporation may require. The President
                  shall be chosen from among the directors, but no other officer
                  need be a director. One person may hold the office of, and
                  perform the duties of, any one or more of the above mentioned
                  positions, except those of President and Secretary or
                  Assistant Secretary.

         5.2.     Election or Appointment and Term of Office. The officers of
                  the corporation shall be elected by the Board of Directors
                  and, except as otherwise provided by these By-Laws, shall hold
                  office until the first meeting of the Board following the next
                  annual meeting of shareholders and until his successor has
                  been elected or appointed and qualified.

         5.3.     Resignation and Removal. Any officer may resign at any time by
                  giving written notice thereof to the Chief Executive Officer,
                  President or to the Board of Directors, and such resignation
                  shall take effect at the time therein specified. Any officer
                  may be removed from office, with or without cause/ by a vote
                  of a majority of the entire Board of Directors.

         5.4.     Vacancies. A vacancy occurring in any office shall be filled
                  by the Board of Directors.

         5.5.     Compensation. Each officer shall receive such salary as
                  compensation as may be determined by the Board of Directors,
                  and no officer shall be prevented from receiving such
                  compensation by reason of the fact that he is also a director
                  of the corporation.

         5.6.     Chairman of the Board of Directors. The Chairman of the Board
                  of Directors shall, when present, preside at all meetings of
                  the shareholders and the Board of Directors.

         5.7.     Chief Executive Officer. The Chief Executive Officer of the
                  corporation, subject to the direction of the Board of
                  Directors, shall have general and active control of its
                  affairs and business and general supervision of its offices,
                  agents and employees. The Chief Executive Officer shall see
                  that all orders and resolutions of the Board are carried into
                  effect. He may sign deeds, mortgages, bonds, contracts or
                  other instruments which the Board of Directors has authorized
                  to be executed, except in cases where the signing and
                  execution thereof shall be expressly delegated by the Board of
                  Directors or by these By-Laws to some other officer or agent
                  of the corporation, or shall be required by law to be
                  otherwise signed or executed. He shall perform all duties
                  incident to the office of Chief Executive Officer and such
                  other duties as may be prescribed by the Board of Directors
                  from time to time. He shall have custody of the treasurer's
                  bond, if any. In the event of the absence, death,
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                                      -9-


                  or incapacity of the President, the Chief Executive Officer
                  shall have the powers and duties of the President.

         5.8.     President. The President, subject to the direction of the
                  Board of Directors, shall have general and active control of
                  the operations, affairs and business of the corporation in
                  North America and general supervision of the corporation's
                  officers, agents and employees in North America. He may sign
                  deeds, mortgages, bonds, contracts or other instruments which
                  the Board of Directors has authorized to be executed, except
                  in cases where the signing and execution thereof shall be
                  expressly delegated by the Board of Directors or by these
                  By-Laws to some other officer or agent of the corporation, or
                  shall be required by law to be otherwise signed or executed.
                  In the event of the absence, death or incapacity of the Chief
                  Executive Officer, the President shall have the powers and the
                  duties of the Chief Executive Officer.

         5.9.     Vice-Presidents. Each Vice-President shall assist the Chief
                  Executive Officer and the President and shall perform such
                  duties as may be assigned to him by the Chief Executive
                  Officer, the President or the Board of Directors. In the event
                  of the absence, death or incapacity of both the Chief
                  Executive Officer and the President, the Vice-Presidents in
                  the order designated by the Board of Directors, or if no such
                  designation has been made, in order of seniority in office,
                  shall have the powers and duties of the Chief Executive
                  Officer and President. Any Vice-President may sign, with the
                  Secretary or other proper officer of the corporation thereunto
                  authorized by the Board of Directors, certificates
                  representing shares of the corporation.

         5.10.    The Secretary. The Secretary shall act as Secretary of all
                  meetings of the Board of Directors and of the Executive
                  Committee and of the stockholders of the corporation, and
                  shall keep the minutes thereof in the proper book or books to
                  be provided for that purpose; he shall see that all notices
                  required to be given by the corporation are duly given and
                  served; he may, with the President or Chief Executive Officer
                  or any of the Vice-Presidents, sign certificates for stock of
                  the corporation; he shall be custodian of the seal of the
                  corporation and shall affix the seal or cause it to be
                  affixed to all certificates for stock of the corporation and
                  to all documents the execution of which on behalf of the
                  corporation under its corporate seal is duly authorized in
                  accordance with the provisions of these By-Laws; he shall have
                  charge of the stock records and also of the other books,
                  records and papers of the corporation relating to its
                  organization and management as a corporation, and shall see
                  that the reports, statements and other documents required by
                  law are properly kept and filed; and shall, in general,
                  perform all the duties incident to the office of secretary and
                  such other duties as from time to time may be assigned to him
                  by the Board of Directors or by the Executive Committee, the
                  Chief Executive Officer or the President.

         5.11.    Treasurer. The Treasurer shall have charge and custody of, and
                  be responsible for, all funds, securities, evidences of
                  indebtedness and other personal property of the corporation
                  and shall deposit, or cause to be deposited, the same in
                  accordance with instructions of the Board of Directors. He
                  shall receive and give receipts and acquittances for moneys
                  paid in on account of the corporation, and shall pay out of
                  the funds on hand all bills, payrolls and
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                                      -10-


                  other just debts of the corporation. He shall enter regularly
                  in the books belonging to the corporation to be kept by him
                  for that purpose, full and accurate accounts of all moneys
                  received and paid out by him on account of the corporation. He
                  shall have the right to require, from time to time, reports
                  or statements giving such information as he may desire with
                  respect to any and all financial transactions of the
                  corporation from the officers or agents transacting the same.
                  Upon the request of the Board, the Chief Executive Officer,
                  the President or the Executive Committee, he shall make such
                  reports to them as they shall require from time to time
                  relating to the financial condition of the corporation and all
                  his transactions as Treasurer. He shall perform all other
                  duties incident to the office of Treasurer and such other
                  duties as from time to time may be assigned to him by the
                  Chief Executive Officer, the President, the Board of Directors
                  or the Executive Committee. He may sign, with the Chief
                  Executive Officer, the President or a Vice-President,
                  certificates for stock of the corporation.

                  The Treasurer shall, if required by the Board of Directors,
                  give the corporation a bond in such sums and with such
                  securities as may be satisfactory to the Board, conditioned
                  upon the faithful performance of his duties and for the
                  restoration to the corporation in case of his death,
                  resignation, retirement or removal from office, of all books,
                  papers, vouchers, money and other property of whatever kind
                  belonging to the corporation in his possession or under his
                  control.

         5.12.    Assistant Secretaries, Assistant Treasurers and Assistant
                  Controllers. The Assistant Secretary, Assistant Treasurer and
                  Assistant Controller, or, if there be more than one, the
                  Assistant Secretaries, Assistant Treasurers and Assistant
                  Controllers in the order determined by the Board of Directors
                  shall, in the absence or disability of the Secretary,
                  Treasurer or the Controller, perform the duties of the
                  Secretary, the Treasurer and the Controller, respectively, and
                  shall perform such other duties and have such other powers as
                  from time to time may be assigned to them or any of them by
                  the Chief Executive Officer, President or Board of Directors
                  or Executive Committee.

                  The Assistant Treasurer or Treasurers shall, if required by
                  the Board of Directors, give the corporation a bond in such
                  sums and with such securities as shall be satisfactory to the
                  Board, conditioned upon the faithful performance of their
                  duties and for the restoration to the corporation in case of
                  their death, resignation, retirement or removal from office,
                  of all books, papers, vouchers, money and other property of
                  whatever kind belonging to the corporation in their possession
                  or under their control.


ARTICLE 6. SHARES

         6.1.     Certificates for Shares. Certificates for stock of the
                  corporation shall be in such form as shall be approved by the
                  Board of Directors. The certificates for such stock shall be
                  numbered in the order of their issue, shall be signed by the
                  Chief Executive Officer, President or one of the
                  Vice-Presidents and by the Secretary, an Assistant Secretary,
                  the Treasurer or an Assistant Treasurer, and the seal of the
                  corporation shall be affixed thereto, which seal may be
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                                      -11-


                  facsimile, engraved or printed. Where any such certificate is
                  signed by a transfer agent or transfer clerk acting on behalf
                  of the corporation and by a registrar, the signatures of the
                  Chief Executive Officer, the President, a Vice President,
                  Secretary, Assistant Secretary, Treasurer or Assistant
                  Treasurer upon such certificate may be facsimiles, engraved or
                  printed. In case any officer or officers who shall have signed
                  or whose signature or facsimile signature or signatures shall
                  be used on any such certificate or certificates shall cease to
                  be such officer or officers of the corporation, whether
                  because of death, resignation, removal or otherwise, before
                  such certificate or certificates shall have been delivered by
                  the corporation, such certificate or certificates shall
                  nevertheless, unless otherwise ordered by the Board of
                  Directors, be issued and delivered as though the person or
                  persons who signed such certificate or certificates or whose
                  facsimile signature or signatures shall have been used thereon
                  had not ceased to be such officer or officers of the
                  corporation.

         6.2.     Transfer of Shares. Upon surrender to the corporation or to a
                  transfer agent of the corporation of a certificate
                  representing shares, duly endorsed or accompanied with proper
                  evidence of succession, assignment or authority to transfer,
                  it shall be the duty of the corporation to issue a new
                  certificate to the person entitled thereto, and cancel the old
                  certificate. The corporation shall be entitled to treat the
                  holder of record of any shares or share of stock as the holder
                  in fact thereof, and, accordingly, shall not be bound to
                  recognize any equitable or other claim to or interest in such
                  share or shares on the part of any other person whether or not
                  the corporation shall have express or other notice thereof,
                  except as may be required by law.

         6.3.     Record of Shareholders. The corporation shall keep at its
                  principal office in the State of New York, or at the office of
                  its transfer agent or registrar in the State of New York a
                  record in written form, or in any other form capable of being
                  converted into written form within a reasonable time, which
                  shall contain the names and addresses of all the shareholders,
                  the number and class of shares held by each, the dates when
                  they respectively became the owners thereof, and, when shares
                  are originally issued by the corporation, the amount paid
                  therefor.

         6.4.     Lost Certificates. In case of the alleged loss, destruction or
                  mutilation of a certificate or certificates representing
                  shares, the Board of Directors may direct the issuance of a
                  new certificate or certificates in lieu thereof upon such
                  terms and conditions in conformity with law as it may
                  prescribe.


ARTICLE 7. INDEMNIFICATION

         7.1.     Indemnification of Certain Persons. To the fullest extent
                  permitted by the laws and statutes of the State of New York:

                  (a)      The corporation shall indemnify any person, made, or
                           threatened to be made, a party to an action or
                           proceeding (other than one by or in the right of the
                           corporation to procure a judgment in its favor),
                           whether civil or criminal, including an action by or
                           in the right of any other corporation of
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                                      -12-


                           any type or kind, domestic of foreign, or any
                           partnership, joint venture, trust, employee benefit
                           plan or other enterprise, which any director or
                           officer of the corporation served in any capacity at
                           the request of the corporation, by reason of the fact
                           that he, his testator or intestate, was a director or
                           officer of the corporation, or served such other
                           corporation, partnership, joint venture, trust,
                           employee benefit plan or other enterprise in any
                           capacity, against judgements, fines, amounts paid in
                           settlement and reasonable expenses, including
                           attorney's fees actually and necessarily incurred as
                           a result of such action or proceeding, or any appeal
                           therein, if such director or officer acted, in good
                           faith, for a purpose which he reasonably believed to
                           be in, or, in the case of service for any other
                           corporation or any partnership, joint venture, trust,
                           employee benefit plan or other enterprise, not
                           opposed to, the best interests of the corporation and
                           , in criminal actions or proceedings, in addition,
                           had no reasonable cause to believe that his conduct
                           was unlawful.

                  (b)      The corporation shall indemnify any person made, or
                           threatened to be made, a party to an action by or in
                           the right of the corporation to procure a judgement
                           in its favor by reason of the fact that he, his
                           testator or intestate, is or was a director or
                           officer of the corporation, or is or was serving at
                           the request of the corporation as a director or
                           officer of any other corporation of any type or kind,
                           domestic or foreign, of any partnership, joint
                           venture, trust, employee benefit plan or other
                           enterprise, against amounts paid in settlement and
                           reasonable expenses, including attorney's fees,
                           actually and necessarily incurred by him in
                           connection with the defense or settlement of such
                           action, or in connection with an appeal therein, if
                           such director or officer acted, in good faith, for a
                           purpose which he reasonably believed to be in, or, in
                           the case of service for any other corporation or any
                           partnership, joint venture, trust, employee benefit
                           plan or other enterprise, not opposed to, the best
                           interests of the corporation, except that no
                           indemnification under this paragraph shall be made in
                           respect of (1) a threatened action, or a pending
                           action which is settled or otherwise disposed of, or
                           (2) any claim, issue or matter as to which such
                           person shall have been adjudged to be liable to the
                           corporation, unless and only to the extent that the
                           court in which the action was brought, or if no
                           action was brought, any court of competent
                           jurisdiction, determines upon application that, in
                           view of all the circumstances of the case, the person
                           is fairly and reasonably entitled to indemnity for
                           such portion of the settlement amount and expenses as
                           the court deems proper.

         7.2.     Indemnification for Expenses. Indemnification for expenses
                  incurred in any civil or criminal action or proceeding as
                  authorized under Section 7.1 (a) and (b) may be paid by the
                  corporation in advance of the final disposition of such action
                  or proceeding in the manner authorized by the laws and
                  statutes of the State of New York subject to repayment by the
                  person, his testator or intestate, to the extent the expenses
                  so advanced by the corporation exceed the indemnification to
                  which such person is entitled or if such person is ultimately
                  found not entitled to indemnification under the laws and
                  statutes of the State of New York.
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                                      -13-


ARTICLE 8. MISCELLANEOUS

         8.1.     Seal. The corporate seal of the corporation shall be circular
                  in form and shall contain the name of the corporation, the
                  year of its organization and such other legend as may from
                  time to time be determined by the Board.


ARTICLE 9. AMENDMENT AND REPEAL

         9.1.     Mode of Amendment or Repeal. These By-Laws may be amended,
                  repealed or new By-Laws adopted, by a majority vote of the
                  shares at the time entitled to vote in the election of any
                  directors or, except as provided in Section 3.2 of these
                  By-Laws, by the affirmative vote of a majority of the members
                  of the Board of Directors present at any meeting duly called
                  and held at which a quorum is present, provided that a
                  reference to the proposed action is contained in the notice or
                  waiver of notice of any meeting held for such purpose. Any
                  By-Law adopted by the Board may be amended or repealed by the
                  shareholders entitled to vote thereon as herein provided.

         9.2.     By-Laws Regulating Impending Election. If any By-Law
                  regulating an impending election of directors is adopted,
                  amended or repealed by the Board, there shall be set forth in
                  the notice of the next meeting of shareholders for the
                  election of directors the By-Law so adopted, amended or
                  repealed, together with a concise statement of the changes
                  made.