THE COMPANIES LAW

                                ARTICLES OF ASSOCIATION

                                    OF TECHNOPRISES LTD.

Interpretation

1.    In these  Articles  of  Association  the  following  terms  will  have the
      meanings described below, unless the context requires otherwise:

      "Articles"                        These Articles of Association, as may be
                                        amended from time to time.

      "Audit Committee"                 The  audit  committee  of the  Board  of
                                        Directors,   established   according  to
                                        these Articles and the Law.

      "Company"                         TECHNOPRISES LTD.

      "Director"                        A  member  of  the  Company's  Board  of
                                        Directors.

      "General Meeting"                 A meeting of the company's  Shareholders
                                        convened according to these Articles and
                                        the Law.

      "Law"                             The Companies Law - 1999,  including any
                                        regulations   and   regulatory    orders
                                        relating thereto and to the Company,  as
                                        will be in effect from time to time.

      "Officer"                         A Director, General Manager,  President,
                                        CEO, Deputy General  Manager,  Assistant
                                        General Manager,  and any person holding
                                        such  office  in the  Company,  even  if
                                        bearing a different title, and any other
                                        manager being directly  subordinated  to
                                        the General Manager.

      "Ordinary Majority"               An   ordinary   majority  of  all  votes
                                        properly  cast  at  a  General  Meeting,
                                        without taking into account abstentions.


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      "Register"                        The register of Shareholders,  including
                                        branch   registers   the   Company   may
                                        maintain, kept according to the Law.

      "Secretary"                       The Company's  corporate  secretary,  as
                                        may be  appointed by the Board from time
                                        to time.

      "Share Capital"                   The Company's  registered share capital,
                                        as authorized in these Articles.

      "Shareholder"                     Any person or entity that is a holder of
                                        shares of the Company according to these
                                        Articles and the Law

      "Special Majority"                A majority of at least sixty-six percent
                                        (66%) of all  votes  properly  cast at a
                                        General  Meeting,  without  taking  into
                                        account abstentions.

      "Voting Instrument"               A written form for  Shareholders to use,
                                        according to these Articles and the Law,
                                        in voting at General Meetings.

      "Writing"                         A handwritten,  typewritten,  facsimile,
                                        print,   e-mail  or  any  other  legally
                                        recognized  form of  communication  that
                                        can be read.

2.    In these  Articles,  unless the  context  otherwise  requires,  terms used
      herein shall have the  meanings  ascribed to them in the Law. In addition,
      words  importing  the singular  will  include the plural,  and vice versa.
      Words importing the masculine gender will include the feminine,  and words
      importing persons will include companies,  partnerships,  associations and
      all other legal  entities.  Days,  months and years refer to the Gregorian
      calendar.

3.    In the event that an Article is revised or a new Article is added to these
      Articles,  which  contradicts  an original  Article,  the revised or added
      Article(s) will prevail.

4.    Unless the context requires  otherwise,  wherever it is specified in these
      Articles  that the  provisions  thereof are according to or subject to the
      provisions  of the Law and/or any other law, the intention is to mandatory
      legislation provisions only.

                                 Public Company

5.    (a) The Company is a public company as defined in the Law.


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      (b)   Subject to any limitation or restriction under any law, the transfer
            of shares in the Company is not restricted.

      (c)   The number of Shareholders is unlimited.

      (d)   The Company may issue any form of its shares or other  securities to
            the public.

6.    The liability of each of the Shareholders of the Company is limited to the
      greater  amount of the two - either  NIS 1.00,  or the  amount,  which the
      Shareholder  is called to pay to the Company  for the  shares,  which have
      been allocated to him but have not yet been paid for by him.

                               Permissible Objects

7.    The Objects of the Company may include any activity permitted by law.

8.    The  Company  may  contribute,  from time to time,  reasonable  amounts to
      worthwhile   causes,   even  if  the   contribution   is  not   based   on
      profit-oriented business considerations.

                           Name and Registered Office

9.    The name of the  Company  is:  Technoprises  Ltd.  and in Hebrew:  [Hebrew
      script].

10.   The Registered Office of the Company will be at such place as the Board of
      Directors shall determine from time to time.

                                  Share Capital

11.   The authorized  Share Capital of the Company is 500,000,000  (five hundred
      million) non par value shares.

                           Alteration of Share Capital

12.   The Company may from time to time,  by a Resolution of  Shareholders  at a
      General  Meeting,  whether or not all the shares then authorized have been
      issued,  and whether or not all the shares then issued have been called up
      for payment,  increase its authorized Share Capital by the creation of new
      shares. Such increase shall be in such amount, divided into shares of such
      nominal  amounts,  subject  to such  restrictions  and terms and with such
      rights and preferences, as the Resolution creating the same shall provide.

13.   Unless  otherwise  provided in the Resolution  authorizing the increase of
      Share  Capital,  the new shares  shall be  subject to the same  provisions
      applicable  to the shares  included in the  existing  Share  Capital  with
      regard to the payment of calls, lien, forfeiture,  transfer,  transmission
      and otherwise.


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14.   The Company may, by a resolution of the Shareholders at a General Meeting:

      (a)   consolidate and re-divide its Share Capital,  fully or partly,  into
            shares of larger nominal (par) value than its existing shares;

      (b)   divide,  by sub-division of its existing shares or any of them, into
            shares  of  smaller  nominal  (par)  value  than  is  fixed  by  the
            Memorandum of Association  and these  Articles;  provided,  however,
            that the proportion between the amount paid and the amount unpaid on
            each  share  which is not fully  paid up shall be  retained  at such
            sub-division;

      (c)   to cancel any shares of its issued or unissued  share  capital,  and
            decrease the amount of its authorized share capital by the amount of
            the shares so  canceled,  subject  to any  commitment  (including  a
            conditional  commitment)  given by the  Company  in  respect of such
            shares and provided that the cancellation of any issued shares shall
            be  equally  made on a  pro-rata  basis  with  respect to all issued
            shares of the Company;

      (d)   reduce its Share  Capital  in any  manner,  subject to any  approval
            required by law.

            The  Shareholders  may delegate to the Company's Board of Directors,
            the  authority  to resolve  with respect to execution of actions set
            forth in  Sections  14(a) and 14(b)  above,  within a time frame and
            subject guidelines and limitations approved at a General Meeting.

15.   If, as a result of a  consolidation  or split of shares  authorized  under
      these  Articles,  fractions  of a share  will  stand to the  credit of any
      Shareholder,  the  Board  is  authorized,  at  its  discretion,  to act as
      follows:

      (a)   determine  that fractions of shares that do not entitle their owners
            to a  whole  share,  will  be  sold by the  Company,  and  that  the
            consideration for such sale be paid to the  beneficiaries,  on terms
            the Board may determine;

      (b)   allot to every Shareholder who holds a fraction of a share resulting
            from a  consolidation  and/or  a split,  shares  of the  class  that
            existed prior to the consolidation and/or split, in a quantity that,
            when consolidated with the fraction,  will constitute a whole share,
            and such allotment will be considered valid immediately prior to the
            consolidation or split;

      (c)   determine  the manner  for paying the  amounts to be paid for shares
            allotted in  accordance  with  Sub-Section  (b) above,  including on
            account of bonus shares; and/or


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      (d)   determine  that  the  owners  of  fractions  of  shares  will not be
            entitled to receive a whole share in respect of a share  fraction or
            that they may receive a whole share with a different  par value than
            that of the fraction of a share.

                           Allotment and Rights of Shares

16.   Subject  to  these  Articles  and to the  terms  of  any  General  Meeting
      resolution  creating new shares, the allotment and issue of shares will be
      as determined by the Board of  Directors,  who may in its sole  discretion
      allot and issue such shares to persons on terms and conditions and at such
      times as determined by the Board of Directors,  including the allotment of
      bonus shares.

17.   (a)   Each ordinary share will entitle its owner to receive notices of, to
            attend, and to cast one vote at a General Meeting.

      (b)   All shares of the Company of the same class shall rank pari passu in
            respect of  dividends,  allotment of bonus shares,  distribution  of
            assets or otherwise.

18.   (a)   The rights  granted to  Shareholders  of any class of shares  issued
            with preferred or other special rights will not, unless specifically
            provided  by the  terms of issue of the  shares  of that  class,  be
            deemed  to be  modified  by the  creation  or issue of  shares  of a
            different class.

      (b)   Unless otherwise provided for by the terms of issuance of particular
            class  of  shares,   the  Company  may  create  or  change   rights,
            preferences,  restrictions and provisions  related to one or more of
            the  classes of shares,  after  receipt of consent in writing of all
            Shareholders  of the affected  class,  or a  Resolution  passed at a
            General  Meeting  of such  class.  These  Articles  will  apply,  as
            applicable, to every such separate General Meeting of a class.

19.   The rights applicable to any shares, whether in the original Share Capital
      or any increased Share Capital, may be changed according to the provisions
      of these Articles.

                              Repurchase of shares

20.   The Company  may,  at any time and from time to time,  subject to the Law,
      purchase  back or finance the  purchase of any shares or other  securities
      issued by the Company, in such manner and under such terms as the Board of
      Directors shall determine, whether from any one or more Shareholders. Such
      purchase  shall not be deemed a payment of dividends;  and no  Shareholder
      will have the right to require the  Company to  purchase  his shares or to
      offer to purchase shares from any other Shareholder.


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                          Share Register and Share Certificates

21.   The Company will maintain a Register of Shareholders according to the Law.
      The Company may maintain the Register of Shareholders or one or two branch
      Registers of Shareholders,  in Israel or another jurisdiction,  which will
      be considered as part of the Register.

22.   The Company  will not be bound by or required  to  recognize  any right or
      interest in any share other than rights or  interests  of the  Shareholder
      duly  registered in the Register or otherwise  proven in  accordance  with
      these Articles and the Law.

23.   Every person whose name duly appears as a  shareholder  in the Register or
      who  otherwise  establishes  proof of ownership in  accordance  with these
      Articles  and the Law,  will have the right  without  payment to  receive,
      within two (2) months after allotment or registration of transfer  (unless
      the conditions of allotment or transfer  provide for a longer  period),  a
      stamped  certificate  for all  the  shares  registered  in his  name.  The
      certificate  will specify the number of shares for which it is issued.  In
      case of joint  Shareholders the Company will not be required to issue more
      than  one  certificate  to  all  the  joint  Shareholders.  Delivery  of a
      certificate to any of the joint  Shareholders will be sufficient  delivery
      to  all.   Every   certificate   will  be  signed  by  two  Directors  and
      countersigned by the Secretary or by other persons  nominated by the Board
      of Directors for that purpose. The Company may withhold the issue of share
      certificates for shares not fully paid up.

24.   If any share certificate will be defaced,  worn out, destroyed or lost, it
      may be replaced  following  production of any  evidence,  provision of any
      indemnity and payment of any of the  Company's  out of pocket  expenses as
      the Board of Directors will require. In case of defacement or wearing out,
      replacement will require delivery of the old certificate.

                     Share Warrants, Options and Debentures

25.   The Company may issue from time to time share warrants, options on shares,
      debentures  and  similar  forms  of  securities.   The  price,  terms  and
      conditions  of any such  securities  will be  determined  by the  Board of
      Directors.

26.   Subject to the applicable provisions of the Law, the Company may issue and
      redeem redeemable preference shares and redeemable warrants.  The terms of
      redemption of, and the rights and obligations attached to such securities,
      shall be determined  by the Board of Directors,  either in general or with
      respect to a particular issue.

                                 Lien on Shares

27.   The Company  will have a lien on every share for all amounts  payable by a
      shareholder  in respect of such share,  whether or not such  payables have
      matured. However, the Board of Directors may at any time declare any share
      to be wholly or partly exempt from the  provisions  of this  Article.  The
      Company's lien, if any, on a share will extend to all dividends payable on
      that share.


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28.   The Company may sell any shares on which it has a lien at such time and in
      such manner as will be determined by the Board of Directors.  However,  no
      sale will be made prior to the lapse of  fourteen  (14) days from the date
      of sending a notice in writing to the registered  Shareholders,  demanding
      payment of such sum and giving notice of the  Company's  intention to sell
      in default.  To give effect to any such sale,  the Board of Directors  may
      authorize  transfer  of the  shares  sold  to the  purchaser  who  will be
      registered  as the holder of the Shares.  The Company will receive the net
      proceeds  of the sale  which  will be  applied  in payment of the sum then
      payable on the lien.  The balance of the sale  proceeds,  if any,  will be
      paid to the  person  holding  the  shares  immediately  prior to the sale,
      subject  to any lien for sums  that  were not  currently  payable  for the
      shares prior to the sale.

                      Calls on Shares; Forfeiture of Shares

29.   The Board of Directors may, at its discretion, from time to time authorize
      the amount and manner of the  consideration to be given to the Company for
      shares.  The Board  may also make  calls on  Shareholders  for any  moneys
      unpaid on their shares.  Each Shareholder will be liable to pay the amount
      of every call so made on him to the persons  and at the times,  places and
      installments specified by the Board. A call may be revoked or postponed as
      the Board may determine.

30.   A call  will be  considered  to have been  made,  at the time the Board of
      Directors approves the resolution authorizing such call.

31.   The joint shareholders of a share will be jointly and severally liable for
      the payment of all calls and related installments.

32.   The Board of  Directors  may,  at its  discretion,  authorize  receipt  of
      advances  from any  shareholder  relating to future  calls on shares.  The
      Board  may  authorize  interest  to be  paid  as may be  agreed  with  the
      advancing shareholder.

33.   Any sum  that,  by the  terms  of a share,  is  payable  upon the  share's
      allotment or at any fixed date,  will be considered to be a call duly made
      and payable on the date fixed for such payment.  In case of non-payment of
      such sum, the relevant  provisions of these Articles will apply as if such
      sum were a call duly made and notified according to these Articles.

34.   The  Board of  Directors  may,  upon the  issue of  shares,  differentiate
      between  the  Shareholders  as to the  amount  of calls to be paid and the
      times of payment.

35.   If any shareholder  fails to pay all or part of any call or installment of
      a call on or before the day set for such  payment,  the Board of Directors
      may serve a notice on such Shareholder. The notice will require payment of
      the amount  remaining  unpaid together with interest,  at such rate as the
      Board will determine,  and any expenses that may have accrued by reason of
      such  non-payment.  The notice will state a date,  not less than  fourteen
      (14) days from the date of the  notice,  on or before  which  such call or
      installment,  and all interest and expenses that have accrued by reason of
      such  non-payment  are to be paid.  It will also  state  the  place  where
      payment is to be made,  and will state that in the event of non-payment on
      or before  the time and at the place  set,  the shares for which such call
      was made will be liable to be forfeited.  If the  requirements of any such
      notice are not met, any share for which such notice has been given may, as
      long as the payment required by the notice has not been made, be forfeited
      by a resolution  of the Board to that effect.  A forfeiture of shares will
      include all  dividends  applicable  to the shares not actually paid before
      the forfeiture, even if the dividend has already been declared.


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36.   When any shares have been  forfeited in  accordance  with these  Articles,
      notice of forfeiture  will be promptly given to the  Shareholder or to the
      person  entitled  to the  shares by  transmission,  as the case may be. An
      entry of such notice  having been given and of the date of the  forfeiture
      of the  applicable  shares  will  be  made  in the  Register.  However,  a
      forfeiture  will not be  invalid  solely  due to the  failure to give such
      notice or to make such entry in the Register.

37.   (a)   Following  a  forfeiture,  the Board of  Directors  may, at any time
            before the forfeited  share has been  otherwise  disposed of, revoke
            the  forfeiture  and  return the share to the  Shareholder  on terms
            determined by the Board.

      (b)   Every  forfeited  share  may be  sold  or  reallotted  or  otherwise
            disposed  of, to any  other  person,  on such  terms as the Board of
            Directors may determine.

38.   A person whose shares have been forfeited will remain liable to pay to the
      Company  all  calls  made  and  not  paid on such  shares  at the  time of
      forfeiture, and interest thereon to date of payment, in the same manner as
      if the shares had not been forfeited.  Such person will also remain liable
      to satisfy any claims and demands  which the Company  might have  enforced
      regarding the shares at the time of  forfeiture,  without any deduction or
      allowance for the value of the shares at the time of forfeiture.  However,
      if the  Company  chooses  to  sell  the  forfeited  shares,  then  the net
      consideration  received  by the  Company  for such shares will be deducted
      from the amount the person whose  shares have been  forfeited is liable to
      pay the Company.

39.   The  forfeiture  of a share  will  cause  the  extinction  at the  time of
      forfeiture  of all claims and demands  against the Company  regarding  the
      share,  and all other  rights  and  liabilities  relating  to the share as
      between the forfeiting Shareholder and the Company,  except as provided by
      law.

40.   A written  declaration  by a Director that a share has been duly forfeited
      according to these  Articles and stating the date of  forfeiture,  will be
      conclusive  evidence of the facts  stated in the  declaration  against any
      persons claiming to be entitled to the forfeited shares. Such declaration,
      together with the Company's receipt for the  consideration,  if any, given
      for the forfeited  shares on their sale or disposition,  and a duly signed
      share  certificate  delivered to the purchaser,  will confer good title to
      the shares. Such purchaser will be registered as the holder of the shares.


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                         Conversion of Shares into Stock

41.   (a)   The Company may, by a Resolution  of the  Shareholders  at a General
            Meeting,  convert any paid-up  shares into stock,  and may reconvert
            any stock into paid-up shares of any denomination.

      (b)   The holders of stock may transfer the same, or any part thereof,  in
            the same manner, and subject to the same regulations,  as the shares
            from which the stock arose  might,  prior to  conversion,  have been
            transferred,  or as near  thereto as  circumstances  admit;  but the
            Board of Directors  may from time to time fix the minimum  amount of
            stock transferable, and restrict or forbid the transfer of fractions
            of that minimum.

      (c)   The holders of stock shall, according to the amount of stock held by
            them,  have the same rights,  privileges,  and advantages as regards
            dividends,  voting at General Meetings, and other matters as if they
            held the shares from which the stock arose,  but no such  privileges
            or advantage,  except  participation in the dividends and profits of
            the Company, shall be conferred by any such aliquot part of stock as
            would not, if existing in shares,  have  conferred that privilege or
            advantage.

      (d)  Such of the Articles of the Company, as are applicable to paid-up
           shares shall apply to stock, and the words "share" and "Shareholder"
           therein shall include "stock" and "Stockholder".

                               Transfer of Shares

42.   Transfer  of fully paid up shares in the  Company  shall not  require  the
      approval of the Board of Directors.

43.   No transfer of shares shall be  registered  unless a proper  instrument of
      transfer has been submitted to the Company,  coupled with the  certificate
      for the shares to be  transferred,  and any other evidence as the Board of
      Directors  may  reasonably  require  of the title of the  transferor.  The
      transferor will be considered to remain the Shareholder  until the name of
      the transferee is entered in the Register for the applicable shares.

44.   The instrument of transfer of any share shall be in the usual or customary
      form or as near thereto as possible, and shall be signed by the transferor
      and transferee.

45.   The Board of  Directors  may decline to register  any  transfer of shares,
      which have not been fully paid up.


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46.   The transfer books, the Register and registers of debenture-holders may be
      closed during such time as the Board of Directors deems fit, not exceeding
      a total of thirty (30) days in each year.

47.   The Board of Directors may determine a fee to be charged for  registration
      of a transfer.

          Transmission of Shares upon Death, Bankruptcy or Dissolution

48.   The  executors and  administrators  of the deceased sole holder of a share
      or, if there are no executors or administrators,  such persons,  heirs (as
      evidenced  by a probate or such other  evidence as the Board of  Directors
      may reasonably deem  sufficient)  shall be the only persons  recognized by
      the  Company  as  having  any  title  to the  share.  In  case  of a share
      registered in the name of two or more holders, the Company shall recognize
      the  survivor  or  survivors  as the only  persons  having any title to or
      benefit in the share.

49.   The receiver or liquidator of a Shareholder in winding-up or  dissolution,
      or the trustee in  bankruptcy,  or any  official  receiver of any bankrupt
      Shareholder,  upon  producing  such evidence as the Board of Directors may
      deem  sufficient as to his  authority to act in such  capacity  under this
      Article,  may be registered as a Shareholder in respect of such shares, or
      may, subject to the regulations as to transfer herein contained,  transfer
      such shares.

                                Borrowing Powers

50.    The Company may from time to time, at its discretion, borrow or secure
       the payment of any sum or sums of money for the purposes of the Company.

51.    The Company may raise the funds for or secure the repayment of such sum
       or sums in such manner, at such times and upon such terms and conditions
       as it deems fit and, in particular, by the issue of bonds, perpetual or
       redeemable debentures, debenture stock, or any mortgages or charges, on
       the whole or any part of the property of the Company, both present and
       future, including its uncalled capital at that time and its called but
       unpaid capital.

                           Convening of General Meetings

52.    General Meetings will be held at least once in every calendar year at the
       time and place, and with an agenda, as may be determined by the Board of
       Directors. Shareholders representing at least ten percent (10%) of the
       Company's outstanding share capital and one percent (1%) of the Company's
       voting power may request the Chairman of the Board to add appropriate
       items to a General Meeting agenda.

53.    Unless otherwise determined by the Board of Directors, the business of an
       Annual Meeting shall be to receive the financial statements and the Board
       of Directors report, to elect Directors, to appoint independent certified
       accountants, and to transact any other business which according to these
       Articles or the Law is to be addressed at an Annual Meeting. Each such
       annual General Meeting will be called an "Annual Meeting", and any other
       Shareholders' meeting will be called a "Special Meeting".


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54.   Each  Annual  Meeting  will take place no later than  fifteen  (15) months
      after  the  previous  Annual  Meeting,  and no  later  than the end of the
      applicable  calendar year. The Board may convene a Special  Meeting at any
      time it deems necessary.

55.   The Board of  Directors  will  convene a Special  Meeting  on receipt of a
      written request from any of:

      (a)   two (2) Directors or  twenty-five  percent (25%) of the total number
            of Directors;

      (b)   one (1) or more Shareholders,  holding at least five percent (5%) of
            the  issued  Share  Capital  and at least  one  percent  (1%) of the
            Shareholders' voting power; or

      (c)   one (1) or more  Shareholders  holding  no less  that  five  percent
            (5%)of the Company's issued voting shares.

56.   A Special Meeting requested under Article 55 above will be convened within
      the period  specified in the relevant  provisions of the Law. If the Board
      of  Directors  fails to convene such  meeting  within such time,  then the
      required Special Meeting may be convened,  in the same manner as for other
      Special  Meetings,  by any of the  Directors  and/or by  Shareholders  who
      requested  the  convening   (representing   at  least   one-half  of  such
      Shareholders' voting rights),  provided it is convened no later than three
      (3) months after submission of the written request to the Board.

57.   The  Board of  Directors  will set a record  date in  accordance  with the
      requirements  of the Law, for  Shareholders  entitled to receive notice of
      and vote at a General  Meeting.  Subject to the terms of the Law, the date
      to be  determined  by the Board,  shall not  precede  the date for which a
      General  Meeting  was called by more than forty (40) nor by less than four
      (4)  days  (or any  longer  or  shorter  period  permitted  by  Law).  The
      determination  of a record  date  shall  apply to any  adjournment  of the
      meeting;  provided,  however,  that the Board of  Directors  may set a new
      record date for the adjourned meeting.

58.   A written notice of the convening of a General  Meeting will be given,  at
      least  twenty-one  (21) days in  advance,  or a longer  period as required
      under the Law and any other  foreign  law which may apply to the  Company.
      The notice  will  specify  the place,  date and time of the  Meeting,  the
      record  date,  and other items as  specified  in the Law. The place of the
      meeting will be in Israel unless otherwise specified by the Board.


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59.   (a)   The accidental  omission to give notice of a General  Meeting to, or
            the non  receipt  of notice by, any  Shareholder  entitled  thereto,
            shall not invalidate the proceedings at such meetings.

      (b)   No shareholder  present,  in person or by proxy, at the commencement
            of a General Meeting shall be entitled to seek the revocation of any
            proceedings  or  resolutions  adopted  at such  General  Meeting  on
            account of any defect in the notice of such meeting  relating to the
            time or the place thereof.

                         Proceedings at General Meetings

60.   No business will be transacted at any General  Meeting  unless a quorum is
      present.  The  quorum  at any  General  Meeting,  will be at least two (2)
      Shareholders  present in person,  by Proxy or by a Voting  Instrument  and
      holding or  representing  at least twenty five percent (25%) of the issued
      voting shares.

61.   If  within  one-half  (1/2)  hour from the time set for the  holding  of a
      General Meeting a quorum is not present,  the meeting will be adjourned to
      the same day,  time and place in the next week or as will be determined in
      the  notice to the  Shareholders,  or  another  date and place as shall be
      determined by the Board of Directors If at such adjourned meeting a quorum
      is not present  within  one-half  (1/2) hour from the time set for holding
      the adjourned meeting,  then any Shareholder,  present in person, by Proxy
      or by a Voting Instrument, will constitute a quorum.

62.   Except as provided  in these  Articles,  the Law and any other  applicable
      law, all  business  transacted  at a General  Meeting will be decided by a
      resolution  adopted by a simple  majority of the votes cast at the General
      Meeting, not taking into account abstentions.

63.   The  Chairman  of the  Board of  Directors  will  preside  at any  General
      Meeting,  but if  there  will be no such  Chairman,  or if at any  General
      Meeting he will not be present or is  unwilling  to act as  Chairman,  the
      Shareholders  present  will choose any  Director to act as Chairman of the
      meeting.  If no  Director  is  present,  or if all the  Directors  present
      decline  to take  the  chair,  the  Shareholders  present  will  choose  a
      Shareholder  present to be Chairman of the  meeting.  The  Chairman of any
      General Meeting shall not be entitled to a second or tie-breaking vote.

64.   The  Chairman  may,  with the  consent of any  General  Meeting at which a
      quorum is present  (and will if so  directed by the  meeting)  adjourn the
      meeting  from time to time and from place to place.  No  Shareholder  will
      have the right to any other  notice of  adjournment.  However,  whenever a
      General  Meeting is adjourned for twenty one (21) days or more,  notice of
      the adjourned  General Meeting will be given in the same manner as for the
      original General Meeting. No business shall be transacted at any adjourned
      meeting  other than the business  which might have been  transacted at the
      meeting as originally called.


                                       12
<PAGE>

                 Voting at General Meetings; Voting Instruments

65.   Shareholders in the Company who are registered in the Register on the date
      determined  by the  Board of  Directors  in its  resolution  to  convene a
      General Meeting and who are present at the meeting, in person or by proxy,
      or deemed to be  present  by a Voting  Instrument,  shall be  entitled  to
      participate in and vote at the General Meeting.

66.   The vote may be by show of hands, by secret ballot,  by Voting  Instrument
      or by any other manner  authorized  by the Board of  Directors  consistent
      with the Law. A Shareholder  will have one (1) vote for each share held by
      him.  However,  unless  otherwise  determined by the Board, no Shareholder
      will be permitted to vote at a General Meeting or to appoint a Proxy to so
      vote  unless he has paid all calls for  payment  and all moneys due to the
      Company from him with respect to his shares.

67.   A Proxy  present  at a  General  Meeting  will  have the same  rights as a
      Shareholder with respect to voting at a General Meeting.  A Proxy need not
      to be a Shareholder.

68.   The vote of the senior of any joint  Shareholders,  whether in person,  by
      Voting  Instrument  or by Proxy,  will be accepted to the exclusion of the
      votes of other  joint  Shareholders.  For the  purpose of these  Articles,
      seniority will be determined by the order in which the names appear in the
      Register.

69.   An objection to a  Shareholder's  or a Proxy's  right to vote in a General
      Meeting must be raised at the applicable  meeting or adjourned  meeting in
      which that person was  supposed to vote.  The Chairman of the meeting will
      decide whether to accept or reject any objection raised at the proper time
      regarding the vote of a Shareholder or Proxy, and the Chairman's  decision
      will be final. Every vote not disqualified as provided above will be valid
      for all matters at the General Meeting.

70.   A  Shareholder  that is a  corporation  or other form of legal entity will
      have the right to appoint a person to be its representative at any General
      Meeting.  The  representative so appointed will have the right to exercise
      on behalf of the  entity he  represents  all the  powers  that the  entity
      itself might exercise in connection with the General Meeting.

71.   A Shareholder who has been declared  legally  incompetent or has otherwise
      been appointed a legal guardian,  may, following proof of appointment of a
      legal  guardian  or  similar  representative,  vote at a  General  Meeting
      through such  guardian or similar  representative,  whether in person,  by
      Voting Instrument or by Proxy.

72.   A vote by Proxy or by Voting  Instrument will be considered  valid even in
      the  event  of  the  death  or   declaration   of   incompetence   of  the
      appointee/signatory or the cancellation of the Proxy appointment or Voting
      Instrument or expiration of a Proxy  appointment  or Voting  Instrument in
      accordance with any law, or the transfer of the shares for which the Proxy
      appointment or Voting Instrument was given, unless the Company receives at
      the Registered  Office,  prior to a General  Meeting,  a written notice as
      specified  below.  For a Voting  Instrument or Proxy  appointment that has
      been  provided  to  the  Company  for a  specific  General  Meeting  to be
      considered   invalid,  a  written  notice  of  cancellation  of  a  Voting
      Instrument or a Proxy  appointment  must be duly signed by the  applicable
      Shareholder specifying the applicable shares, the name of the Shareholder,
      legal  representative  or  successor  in interest  and nature of the event
      invalidating the Proxy appointment or Voting  Instrument.  In the event of
      voting by a secret ballot or by Voting Instrument,  a notice canceling the
      appointment   of  a  Proxy   will  be  valid  if  it  is   signed  by  the
      appointee/signatory  or its legal  representative or successor in interest
      and  received at the  Registered  Office no later than one (1) hour before
      the beginning of the vote.


                                       13
<PAGE>

73.   A Shareholder  will have the right,  to vote by a Voting  Instrument as an
      alternative to voting in person or by Proxy. In all applicable  cases, the
      Company will send the Voting  Instrument  to the  Shareholders  before the
      applicable General Meeting, no later than the time set for that purpose in
      the Law.

74.   A  Shareholder  has the right to vote by a separate  Proxy with respect to
      each  share  held by him,  provided  that each  Proxy will have a separate
      letter of appointment containing the serial number of the shares for which
      the Proxy is  entitled  to vote.  If a specific  share is included in more
      than one (1) letter of  appointment,  then no Proxy will have the right to
      vote such share.

75.   An  instrument  appointing  a Proxy,  which is not  limited in time,  will
      expire  twelve  (12)  months  after  the  date  of its  execution.  If the
      appointment  is for a limited  time  period,  even  exceeding  twelve (12)
      months,  the instrument  will be valid for such period as specified in the
      instrument.

76.   (a)   A Voting Instrument,  instrument of appointment of a Proxy, power of
            attorney  or  other  instrument  relating  to  voting  at a  General
            Meeting, must be in writing.

      (b)   Any instrument of appointment a of proxy,  whether for any specified
            meeting or otherwise  shall, as far as circumstances  permit,  be in
            the following form or in any other  acceptable  form approved by the
            Board of Directors:

            "I, , of , being the  holder of shares of NIS each,  hereby  appoint
            Mr. of to vote for me and on my behalf at the General Meeting of the
            Company  to be held on the day of in the year  and at any  adjourned
            meeting of such meeting."

            IN  WITNESS  WHEREOF I have set my hand this ___ day of the month of
            _____________ in the year _____."

      (c)   The  original  or a  copy  of  such  confirmed  instrument  will  be
            delivered to the Registered Office, or to such other place in Israel
            or abroad as the  Board  may from time to time  designate,  at least
            twenty-four  (24)  hours  before  the  time  set for the  applicable
            original or adjourned General Meeting.  Otherwise,  that person will
            not be entitled to vote that share  through the  instrument.  At the
            request of the Chairman of a General  Meeting,  written  evidence of
            such  authorization,  in a reasonably  acceptable  form and content,
            satisfactory to the Chairman, shall be furnished to the Chairman.


                                       14
<PAGE>

                  Role and Composition of The Board of Directors

77.   The Board of  Directors  will set the  policies of the Company and oversee
      the execution by the General Manager of his tasks and acts. The Board will
      have all residual powers not granted under these Articles or by law to any
      other Company body.

78.   The General  Meeting may assume powers  granted under these Articles or by
      Law to the Board of Directors. However, any decision to assume such powers
      must be adopted by a Special  Majority  and must  specify  the matters and
      time period for which such powers are assumed.

79.   The number of Directors may be determined  from time to time by the Board.
      Unless  otherwise  determined  by  the  Board,  the  number  of  Directors
      comprising the Board will be at least four (3) and not more than ten (10).
      The Board will include at least two (2) External  Directors in  accordance
      with the requirements of the Law. A Director need not to be a Shareholder.

80.   The Directors will be entitled to be reimbursed  for  reasonable  expenses
      incurred by them in performing  their services as Directors.  The External
      Directors  shall be paid for their services,  as prescribed  under the Law
      and as resolved by the General Meeting.

81.   Subject to the  provisions  of the Law, a Director (or any other  Officer)
      shall not be  disqualified  by his holding of such office with the Company
      from holding any other office or function with the Company (other than the
      office of an Internal Auditor or Independent Certified Accountant) or from
      giving services for consideration to the Company, save that the additional
      employment  of a  Director  and the terms  thereof  must be  approved,  as
      required  by the Law;  nor  will a  Director  (or any  other  Officer)  be
      disqualified  by the holding of such office with the Company  from holding
      any other office or function or from giving services for  consideration to
      a  company  in  which  the  Company  holds  any  shares  or in which it is
      interested in any other way.

                 Election, Appointment and Removal of Directors

82.   Directors  will be  elected  annually  by the  Shareholders  at the Annual
      Meeting.Directors will hold office until the conclusion of the next Annual
      Meeting or until their  earlier  removal or  resignation.  However,  if no
      Directors are elected at an Annual Meeting, then the persons who served as
      Directors  immediately  prior  to  the  Annual  Meeting  shall  be  deemed
      reelected  at the same  meeting,  and will  continue to serve as Directors
      unless  otherwise  determined  by the Annual  Meeting.  Directors  will be
      eligible for re-election.


                                       15
<PAGE>

83.   Notwithstanding Article 83 above:

      (a)   the General  Meeting  may  resolve  that a director be elected for a
            period  longer than by the next  Annual  Meeting but not longer than
            the third next Annual Meeting.

      (b)   Shareholders  holding a majority of the outstanding share capital of
            the Company may remove or elect directors by a written notice to the
            Company.

      (c)   A General  Meeting may,  remove any Director  from his office before
            the end of his term and can,  by a  resolution  adopted  by a simple
            majority, elect another person in his place.

84.   The Chairman of the Board of Directors will be appointed by the Board from
      the  Directors  elected  to their  office.  Such  Director  will  serve as
      Chairman of the Board of  Directors  until he ceases to hold the office of
      Director or until the General Meeting replaces him.

85.   The Board of Directors will have the power,  from time to time, to appoint
      additional  Directors if the current  number of Directors is less than ten
      (10) or such other maximum number approved by the Board of Directors.  Any
      Director so appointed  will hold office until the  conclusion  of the next
      Annual Meeting, unless he is removed or resigns earlier.

86.   Where the office of a Director has been vacated,  the remaining  Directors
      may  continue  to act,  but if their  number is reduced  below the minimum
      number  specified  in these  Articles,  or if the number of the  Directors
      elected by a General Meeting is lower than the minimum number specified in
      these Articles,  then the Director or Directors  continuing to hold office
      shall  not act  except  in case of an  emergency,  or for the  purpose  of
      increasing  the number of Directors,  by way of  appointment of additional
      Directors,  or for the  purpose  of  convening  a General  Meeting  of the
      Company, but not for any other purpose.

87.   Subject to the terms of the Law, a Director will be removed if he:

      (a)   becomes  bankrupt or enters into similar status (and if the Director
            is a company, upon its winding-up);

      (b)   dies or is declared legally incompetent;

      (c)   resigns his office by notice in writing given to the Company;


                                       16
<PAGE>

      (d)   is removed by a resolution of a General Meeting; or

      (e)   upon the occurrence of any of the applicable events set forth in the
            Law.

                               Substitute Director

88.   (a)   A Director  may,  by notice in writing to the Company and subject to
            Sub-Section  (b),  appoint  for  a  specific  meeting  a  substitute
            (hereinafter  referred  to as  "Substitute  Director"),  revoke  the
            appointment of such  Substitute  Director and appoint another in his
            place. Any appointment, or revocation of appointment of a Substitute
            Director  shall become  effective on the date set in the  respective
            notice of  appointment  or  revocation,  as the case may be, but not
            before delivery thereof to the Company.

      (b)   A person may not act as a Substitute Director if he is not qualified
            to be appointed a Director or if he  currently  serves as a Director
            or Substitute Director.

      (c)   A Substitute  Director  shall be entitled to receive  notices of the
            meeting of the Board of  Directors  for which he has been  appointed
            and to attend and vote at such meeting as if he were a Director, and
            he shall have all the rights  and be subject to all  obligations  of
            the Director for whom he acts as Substitute Director.

      (d)   The office of a Substitute  Director  shall ipso facto be vacated at
            the end of the  meeting of the Board of  Directors  for which he has
            been so appointed;  if he is removed from office in accordance  with
            Sub-Section (a) hereof; if the office of the Director by whom he has
            been  appointed  Substitute  Director  is  vacated  for  any  reason
            whatsoever or upon the death of the Substitute  Director or upon the
            occurrence of any of the events referred to in Article 88.

                               External Directors

89.   The Board of Directors will include at least two (2) External Directors or
      such  other  number,   all  as  required  in  order  to  comply  with  the
      qualifications described in the Law.

90.   An External  Director  will be nominated  by a majority  vote at a General
      Meeting, provided that:

      (a)   The majority vote at the General  Meeting will include at least one-
            third (1/3) of the total number of the votes of the  non-controlling
            Shareholders  voting  at the  meeting.  For  the  purposes  of  this
            Article, abstentions will not be counted towards the total number of
            the non-controlling Shareholders; and


                                       17
<PAGE>

      (b)   The total number of non-controlling  Shareholders voting against the
            resolution  appointing the External  Director,  is not more than one
            percent (1%) of the total voting rights in the Company.

91.   The compensation  and  indemnification  of expenses of External  Directors
      will be  determined in accordance  with the  applicable  provisions of the
      Law.

92.   An External  Director  will be appointed  for a period of three (3) years.
      The term of his office may be  extended  by a  resolution  of the  General
      Meeting for an  additional  three (3) years.  An External  Director may be
      removed from his office only in accordance with the applicable  provisions
      of the Law.

                           Board of Directors Meetings

93.   The Board of Directors  may convene,  adjourn and  otherwise  regulate its
      meetings, as it deems fit; provided,  however, that the Board will meet at
      least once in every three (3) months period.  Unless otherwise  determined
      by the Board,  the quorum for a Board meeting will be not less than thirty
      percent  (30%) of the then number of  Directors  but in any event not less
      then two directors.

94.   No business  shall be  transacted  at a meeting of the Board of  Directors
      unless the requisite quorum is present at the commencement of the meeting,
      and no resolution  shall be adopted unless the requisite quorum is present
      when the resolution is voted upon.

95.   Issues  arising at any Board of  Directors'  meeting  will be decided by a
      majority of votes cast at the meeting. In case of a tie, the Chairman will
      not have a second or casting vote.

96.   Each Director will receive at least 3 (three) days prior notice of a Board
      meeting.  Such  notice  may be given  by any  means  of  communication  as
      determined  by the Chairmen or the  Secretary,  including,  among  others,
      telephone,  facsimile  or e-mail.  Such notice  will  include the time and
      location of the  meeting and a  reasonable  description  of the  meeting's
      agenda.  Notwithstanding  anything  to the  contrary  herein,  failure  to
      deliver  notice to a Director of any such  meeting in the manner  required
      hereby may be waived (in advance or retroactively) by such Director, and a
      meeting  shall be deemed to have been duly convened  notwithstanding  such
      defective  notice of such failure or defect.  Without  derogating from the
      foregoing,  no Director  present at the  commencement  of a meeting of the
      Board  of  Directors  shall be  entitled  to seek  the  revocation  of any
      proceedings  or  resolutions  adopted  at such  meeting  on account of any
      defect in the  notice of such  meeting  relating  to the time or the place
      thereof.

97.   At the request of any Director, the Secretary will summon a meeting of the
      Board of Directors.


                                       18
<PAGE>

98.   The  Chairman  of the  Board of  Directors  shall  take  the  chair at all
      meetings of the Board of Directors,  but if there is no Chairman, or if at
      any  meeting he is not present  within  fifteen  (15)  minutes of the time
      appointed for the meeting,  or if he is unwilling to take the chair at the
      meeting,  the  Directors  present shall choose on Director to serve as the
      Chairman of such meeting.

99.   A meeting of the Board of Directors at which a quorum is present  shall be
      competent to exercise all the  authorities,  powers and  discretions by or
      under the Law and the  Articles  of the  Company at that time vested in or
      exercisable by the Board of Directors.

100.  Directors may participate in a Board meeting or Board committee meeting by
      means of a telephone  conference or other communications  media,  provided
      that all  participating  Directors  can hear  each  other  simultaneously.
      Participation  by such means will be considered as presence in person at a
      meeting.

101.  All acts done at any meeting of the Board of Directors,  or of a Committee
      of the Board of Directors,  or by any person  acting as a Director  shall,
      notwithstanding  that it may afterwards be discovered  that there was some
      defect in the  appointment  of such Directors or members of a Committee of
      the Board of Directors or persons  acting as aforesaid or any of them,  or
      that they or any of them were  disqualified,  be as valid as if every such
      person had been duly  appointed  and was  qualified  to be  Director  or a
      member of such Committee of the Board of Directors.

102.  A resolution in writing  signed by all of the Directors or to which all of
      the Directors  have agreed in writing or by telephone or facsimile,  shall
      be as valid and  effective  for all  purposes as if passed at a meeting of
      the Board of Directors duly convened and held, and for the purpose of this
      Article  "Director"  shall  include,  if  duly  appointed   therefore,   a
      Substitute Director.

103.  Minutes in writing  signed by the  Chairman  will serve as  evidence  of a
      resolution passed at a duly convened meeting of the Board of Directors.

                      Committees of The Board of Directors

104.  Subject to the applicable provisions of the Law regarding matters that the
      Board may not delegate to a committee, the Board of Directors may delegate
      any  of  its  powers  to  committees  consisting  of at  least  three  (3)
      Directors,  provided that each such  committee  shall include at least one
      (1) External Director. The Board of Directors may from time to time revoke
      such  delegation  or alter  the  composition  of any such  committee.  Any
      committee  so formed  will  exercise  its  powers in  accordance  with any
      directions given to it by the Board.

105.  A Board committee may elect a chairman. If no such chairman is elected, or
      if at any meeting the chairman is not present  within fifteen (15) minutes
      after the time  appointed for holding the meeting,  the committee  members
      present  may choose a  committee  member to be  chairman  of the  meeting.
      Unless  otherwise  specifically  directed by the Board of  Directors,  the
      meetings  and  proceedings  of  any  committee  will  be  governed  by the
      applicable  provisions  in these  Articles  regulating  the  meetings  and
      proceedings of the Board.


                                       19
<PAGE>

106.  A committee  may meet and adjourn as its  members  may  determine.  Issues
      arising at any meeting  will be  determined  by a majority of votes of the
      members  present.  In case of a tie the chairman of the committee will not
      have a second or tie breaking vote.

107.  The Board of  Directors  will  appoint an Audit  Committee  composed of at
      least three (3)  Directors  qualified  under the Law to serve on the Audit
      Committee,  including all the External Directors. The Audit Committee will
      act according to the requirements of the Law.

                                Local Management

108.  The Board of Directors may from time to time,  provide for the  management
      and  transaction of the affairs of the Company in any specified  locality,
      whether  in Israel or  abroad,  in such  manner as it deems  fit,  and the
      provisions  contained  in the next  following  Article  shall  be  without
      prejudice to the general  powers vested by these  Articles on the Board of
      Directors.

109.  The Board of Directors may from time to time,  and at any time,  establish
      any local board or agency for  managing  any of the affairs of the Company
      in any such specified locality,  and may appoint any person to be a member
      of  such  local  board,  or any  manager  or  agent,  and  may  fix  their
      remuneration. Subject to the provisions of the Law, the Board of Directors
      may  from  time to  time,  and at any  time,  delegate  to any  person  so
      appointed  any of the powers,  authorities  and  discretions  at that time
      vested in the  Board of  Directors,  on such  terms  and  subject  to such
      conditions as the Board of Directors deems fit, and the Board of Directors
      may at any time remove any person so appointed  and may revoke or vary any
      such delegation.

                                 General Manager

110.  The  Board  of  Directors  shall  from  time to time  appoint  one or more
      persons,  whether or not Directors as Chief Executive Officer or Officers,
      General  Manager or Managers,  or  President of the Company,  either for a
      fixed  or an  unlimited  term,  and  from  time  to time  (subject  to any
      provisions of the Law and of any contract  between any such person and the
      Company)  remove or dismiss him or them from office and appoint another or
      others in his or their stead.

111.  The  remuneration  of a  General  Manager,  Chief  Executive  Officer  and
      President,  shall from time to time (subject to the  provisions of the Law
      and any contract  between him and the Company) be  determined by the Board
      of Directors.


                                       20
<PAGE>

112.  The General Manager shall be responsible for the day-to-day  management of
      the Company's  affairs within the framework of the Company's policy set by
      the Board of Directors  and subject to its  directions;  he shall have all
      management and execution powers not vested by the Law or these Articles in
      any other Organ, and he will be subject to the supervision of the Board of
      Directors.  Subject to the  provisions  of the Law, the Board of Directors
      may from time to time,  and at any time,  entrust to and  confer  upon the
      General Manager such powers exercisable under the Articles by the Board of
      Directors  as it may deem fit,  and may confer  such powers for such time,
      and to be exercised for such objects and purposes, and upon such terms and
      conditions, and with such restrictions,  as it deems expedient; and it may
      confer such powers,  either collaterally with, or to the exclusion of, and
      in substitution for, all or any of the powers of the Board of Directors in
      that behalf;  and may from time to time revoke,  withdraw,  alter, or vary
      all or any of such powers.

                             Dividends and Reserves

113.  The Board of Directors may from time to time declare and cause the Company
      to pay to the Shareholders  such interim or final dividend as the Board of
      Directors deems appropriate  considering the profits of the Company and in
      compliance  with the provisions of the Law. The Board may set the dividend
      record date (which  date may be on or after the date of  declaration)  and
      the time for payment.

114.  No  dividend  shall  be paid  otherwise  than  out of the  profits  of the
      Company.

115.  No dividend shall be paid other than in compliance  with the provisions of
      the Law; and no dividend shall carry interest as against the Company.

116.  The Board of Directors may, before declaring any dividend,  set aside, out
      of the profits of the  Company,  such sums as it deems  appropriate,  as a
      reserve fund to meet contingencies,  or for equalization of dividends,  or
      for special dividends, or for repairing,  improving and maintaining any of
      the  property of the Company,  or for such other  purposes as the Board of
      Directors shall in its absolute discretion deem conducive to the interests
      of the  Company;  and  may  invest  such  sum(s)  so  set  aside  in  such
      investments  as it  may  deem  fit,  and  from  time  to  time  vary  such
      investments, and dispose of all or any part thereof for the benefit of the
      Company,  and may divide the reserve  fund into such  special  funds as it
      deems fit, and use the reserve fund or any part thereof in the business of
      the Company,  and that without  being bound to keep the same separate from
      the other asset of the Company.

117.  Subject to special rights of Shareholders and subject to the provisions of
      these Articles,  dividends,  whether in cash or in bonus shares,  shall be
      paid or distributed,  as the case may be, to Shareholders  pro rata to the
      amount paid up or  credited as paid up on account of the of their  shares,
      without taking into consideration any premium paid thereon; but the amount
      paid up on account of a share prior to call being made thereon or prior to
      the due date for  payment  thereof,  and on which  the  Company  is paying
      interest,  shall not,  for  purposes of this  Article,  be deemed to be an
      amount paid up on account of a share.  Notwithstanding  the above,  and to
      the extent  that the rights  attached  to the shares or the terms of issue
      thereof otherwise  provide,  the Board of Directors may determine that any
      amount paid on a share  during the period in respect of which the dividend
      has been  declared  shall  entitle  the  holder  of such  share  only to a
      proportionate  amount  of the  dividend  having  regard to the date of the
      payment of the said amount of capital.


                                       21
<PAGE>

118.  Unless  otherwise  directed  by the  Board of  Directors  or by a  General
      Meeting,  any  dividend  may be paid by  check  or  bank  transfer  to the
      registered address of the Shareholder;  or in case of joint  Shareholders,
      to the one of  them  first  named  in the  Register  regarding  the  joint
      holding.  The receipt of the person  whose name on the record date appears
      on the  Register  as the  owner  of any  share,  or in the  case of  joint
      Shareholders,  of any one of such joint  Shareholders,  will be sufficient
      evidence of all  payments  made for such share.  All  dividends  unclaimed
      after having been  declared may be invested or otherwise  used as directed
      by the Board for the benefit of the Company until claimed.  Upon the lapse
      of seven (7) years from the  declaration  of such  dividends,  the Company
      will  have no  obligation  to pay the  unclaimed  dividend.  No  unclaimed
      dividend or interest will bear interest from the Company.

119.  Without   derogation   from  the  provisions  of  Section  113,  upon  the
      recommendation  of the Board of Directors  approved by a  resolution  at a
      General  Meeting,  any  General  Meeting  may  resolve  that  any  moneys,
      investments,  or other assets forming part of the undivided profits of the
      Company  standing to the credit of the reserve  fund,  or to the credit of
      the  reserve  fund for the  redemption  of  capital or in the hands of the
      Company and  available for  distribution  of  dividends,  or  representing
      premiums received on the issue of shares and standing to the credit of the
      share premium  account,  be capitalized and distributed  among such of the
      Shareholders  as would be entitled to receive the same if  distributed  by
      way of  dividend  and in the same  proportion  and on the same basis ; and
      that all or any part of such capitalized fund be applied on behalf of such
      Shareholders  in paying up in full,  either at par or at such  premiums as
      the  resolution  may provide,  any unissued  shares or  debentures  of the
      Company,  which shall be distributed  accordingly and shall be accepted by
      such  Shareholders  in full  satisfaction  of  their  rights  in the  said
      capitalized sum.

120.  Without  derogation  from the provisions of Section 113, a General Meeting
      may resolve that a dividend be paid,  in whole or in part,  in cash and/or
      by the distribution of specific assets and, in particular, by distribution
      of paid-up  shares,  paid-up  debentures,  or debenture stock of any other
      company, or in any one or more combinations of such ways.

121.  In order to give effect to any resolution  regarding the  distribution  of
      shares or debentures by way of capitalisation of profits as aforesaid, the
      Board of Directors may:


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<PAGE>

      (a)   settle, in such manner as it deems fit, any difficulty  arising with
            regard  to the  distribution  and  take any  steps  it deems  fit to
            overcome such difficulty;

      (b)   issue certificates for fractions of shares or resolve that fractions
            of lesser  amount than that  decided  upon by the Board of Directors
            will not be taken into  account  for the  purpose of  adjusting  the
            rights of the shareholders,  or sell fractions of shares and pay the
            net consideration to the persons entitled thereto;

      (c)   sign on the shareholders' behalf any contract or other document that
            may be required in order to give effect to the distribution,  and in
            particular  it may sign and submit for  registration  a contract  as
            mentioned in section 291 of the Law;

      (d)   make any arrangement or other settlement  required,  in the board of
            directors' opinion, to facilitate the distribution.

122.  The Board of Directors  may deduct from any dividend or other amount to be
      paid in  respect  of  shares  held by any  Shareholder,  whether  alone or
      together  with  another  Shareholder,  any sum or sums  due  from  him and
      payable by him, alone or together with any other person, to the Company on
      account of calls or the like.

123.  If several  persons are registered as joint holders of any share,  any one
      of them may give valid receipts for any dividends payable on the share.

                                     Minutes

124.  The Board of  Directors  shall cause  minutes to be duly  entered in books
      provided for that purpose:

      (a)   of the names of the  Directors  present at each meeting of the Board
            of Directors and of any Committee of the Board of Directors;

      (b)   of the names of the Shareholders present at each General Meeting;

      (c)   of all  directions  given by the Board of Directors to any Committee
            of the Board of Directors;

      (d)   of the  proceedings  and  resolutions  of  General  Meetings  and of
            meetings of the Board of Directors  and  Committees  of the Board of
            Directors.

125.  Any minutes, as aforesaid,  of a meeting of the Board of Directors,  which
      is confirmed  and signed by the chairman of the meeting or by the Chairman
      of the Board of Directors,  and any minutes of a meeting of a Committee of
      the Board of Directors or of a General Meeting,  if signed by the chairman
      of such meeting,  shall be accepted as prima facie evidence of the matters
      therein recorded.


                                       23
<PAGE>

                          Stamp and rights of signature

126.  The Company shall have a stamp,  and the Board of Directors  shall provide
      for the safe custody of such stamp.

127.  The Board of Directors  shall be entitled to authorize any person(s) (even
      if such person(s)  is/are not  Director(s) of the Company) to act and sign
      on behalf of the Company,  and the acts and  signatures  of such person or
      persons on behalf of the Company  shall bind the  Company  insofar as such
      person  or  persons  acted  and  signed  within  the scope of his or their
      authority.

                      The Secretary, officers and Attorneys

128.  Unless otherwise determined by the Board of Directors, the Chairman of the
      Board of Directors,  the President or any committee or officer  authorized
      by the Board of Directors  may from time to time  appoint a Secretary  for
      the Company, as well as other officers,  personnel,  agents and employees,
      to permanent,  temporary or special positions, and the General Manager may
      determine  and/or  modify  their  titles,  powers,  duties,  remuneration,
      salaries  and  bonuses.  The  Chairman  of the  Board  of  Directors,  the
      President,  or  any  committee  or  officer  authorized  by the  Board  of
      Directors  may  from  time  to  time,  in  its  discretion,   revoke  such
      appointments,  modify  their  scope,  or suspend the service of any one or
      more of such persons.

129.  The Board of Directors may from time to time, and at any time, by power of
      attorney,  appoint any company, firm or person or body of persons, whether
      nominated  directly or  indirectly  by the Board of  Directors,  to be the
      Company's  Attorney or Attorneys  for such  purposes and with such powers,
      authorities and discretions  (not exceeding those vested in or exercisable
      by the  General  Manager  under the Law or these  Articles),  and for such
      period and subject to such  conditions as it deems fit, and any such power
      of attorney may contain such provisions for the protection and convenience
      of persons  dealing with any such Attorney as the General Manager may deem
      fit, and may also  authorize  any such  Attorney to delegate all or any of
      the powers, authorities and discretions vested in him.

                                    Accounts

130.  The Board of Directors  will cause the  Company's  books of accounts to be
      kept in accordance  with legal  requirements.  A Shareholder  who is not a
      Director  shall not have any right of  inspecting  any  account or book or
      document of the Company  except as conferred upon him by Law or authorized
      by the Board of Directors or by the General Meeting.

131.  The Company  will issue  financial  statements  as required by the Law and
      other applicable  laws. The issued financial  statements will be available
      for  inspection  by  the  Board  of  Directors  and  Shareholders  at  the
      Registered Office during regular office hours.


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<PAGE>

                        Independent Certified Accountants

132.  The Company will appoint  Independent  Certified  Accountants at a General
      Meeting. The Independent  Certified Accountants will hold office until the
      end of the next Annual  Meeting.  However,  the  Shareholders at a General
      Meeting may remove the  Independent  Certified  Accountants  or extend the
      term of appointment for up to three (3) years.

133.  The fee of the Independent  Certified Accountants will be set and approved
      by the Board of Directors.

                                Internal Auditor

134.  (a)   The Board of Directors,  subject to the  recommendation of the Audit
            Committee,  will appoint an Internal  Auditor for the  Company.  The
            Internal Auditor will report to the General Manager.

      (b)   The Internal  Auditor may only be removed or replaced in  accordance
            with the applicable provisions of the Law.

                                     Mergers

135.  Notwithstanding Section 327 of the Law, the Company may approve any Merger
      as defined in the Law, by a resolution  adopted by a simple vote cast at a
      General Meeting, not taking into account abstentions.

                                    Notices

136.  (a)   Notices by the Company to a Shareholder shall be given by registered
            mail to the address,  if any,  supplied by such  Shareholder for the
            purpose of giving notices, as listed in the Register. In the absence
            of such  address,  notice  shall be  deemed  to have  been  given by
            posting thereof at the Registered Office of the Company.  Notice may
            also be given by way of  transmission  of facsimile  and/or  e-mail,
            based on details of such Shareholder as listed in the Register.

      (b)   Notice by registered  mail shall be deemed  received  three (3) days
            from the  date on  which a  properly  addressed,  prepaid  enclosure
            containing the notice was mailed. Notice by facsimile and/or e-mail,
            shal be deemed to be received (i) one day from their transmission.


                                       25
<PAGE>

137.  Notice  to  joint  Shareholders  may be given  by  sending  it only to the
      Shareholder first named in the Register for the applicable shares.

138.  (a)   The Board of  Directors  may  authorize  other  methods of notice to
            Shareholders that are consistent with the Law.

      (b)   Notices of General Meetings will contain the information required by
            the Law.

                       Exemption, Insurance and Indemnity

139.  The Company may exempt any Officer  from his  liability to the Company for
      breach of duty of care, to the maximum extent  permitted by law, before or
      after the occurrence giving rise to such liability.

140.  Subject to the  provisions  of the Law, the Company may exempt and release
      in advance or retroactively, any Officer from liability resulting from his
      breach of his duty of care to the Company.

141.  Subject to the  provisions  of the Law,  the Company may  procure,  as the
      Board may from time to time determine,  Directors' and Officers' liability
      insurance  covering the  liabilities of an Officer for any act done by him
      by virtue of being an Officer, in respect of any of the following:

      (a)   breach of duty of care  towards  the  Company or  towards  any other
            person;

      (b)   breach of fiduciary  duty towards the  Company,  provided  that such
            Officer  acted in good  faith and had a  reasonable  basis to assume
            that his action would not harm the interests of the Company;

      (c)   financial liabilities imposed on him in favor of a third party; or

      (d)   any other  event  for which  insurance  of an  Officer  is or may be
            permitted.

142.   Subject to the provisions of the Law, the Company may undertake in
       advance or retroactively to indemnify any past or present Officer in
       respect of a liability or expense as detailed in Article 143 below,
       imposed on him as a result of an act carried out in his capacity as an
       Officer. However, if made in advance, such undertaking will be limited to
       the kinds of events that, in the Board's opinion, are foreseeable at the
       time of the approval of the indemnification undertaking and will be
       limited to the amount fixed by the Board as reasonable under the
       circumstances which shall not exceed 25% of the Company's Shareholders
       Equity for the time being.

143.   An indemnity, as provided in Article 142 above, may be issued in respect
       of a liability or expense as follows:

      (a)   a  monetary  liability  imposed  on the  Officer in favor of a third
            party under a judgment, including a judgment by way of compromise or
            judgment of an arbitrator approved by a court;

      (b)   reasonable  expenses of the  proceedings,  including  lawyers' fees,
            expended by the Officer or imposed on him by the court for:


                                       26
<PAGE>

            (1)   proceedings  issued against him by or on behalf of the Company
                  or by a third party;

            (2)   criminal proceedings in which the Officer was acquitted; or

            (3)   criminal  proceedings in which he was convicted in an offense,
                  which did not  require  proof of criminal  intent;  or (c) any
                  other liability or expense for which the indemnification of an
                  Officer is not precluded by Law.

144.  Subject to the provisions of the Law, the Company may issue an undertaking
      in advance or retroactively to indemnity any person, including an Officer,
      who acts or acted on behalf or at the request of the Company as a director
      or  officer  of  another  company  in  which  the  Company,   directly  or
      indirectly,  is a  shareholder,  or in which  the  Company  has any  other
      interest.  Such  indemnity  will be in respect of a  liability  or expense
      referred  to in Article  146  above,  imposed on him as a result of an act
      carried  out by him in his  capacity as a director or officer of the other
      company. However, such undertaking, if made in advance, will be limited to
      the kinds of events that, in the Board's  opinion,  are foreseeable at the
      time  of the  approval  of the  indemnification  undertaking  and  will be
      limited  to  the  amount  set  by  the  Board  as  reasonable   under  the
      circumstances  which  shall not exceed 25% of the  Company's  Shareholders
      Equity for the time being.

145.  Subject to the provisions of the Law, nothing in these Articles will limit
      the Company,  in any manner,  from entering into an agreement of liability
      insurance, or in granting an exemption or indemnification in respect of:

      (a)   an Officer,  or a director or officer of another company as provided
            in Article 144 above, to the extent that the insurance, exemption or
            indemnity is not prohibited by law; or

      (b)   any person who is not an officer,  or a director of another  company
            as  provided  in Article  145 above,  including  but not  limited to
            employees and  representatives  of the Company.  Reorganization  and
            Winding Up

146.  If the Company will be wound up voluntarily the liquidators  may, with the
      approval  of a Special  Majority of the  Shareholders  voting at a General
      Meeting,  divide among the  Shareholders  any part of the Company's assets
      remaining after payment of all of the Company's  outstanding  obligations.
      Such approval may also vest any part of the  Company's  assets to trustees
      under trusts for the benefit of the  Shareholders  as the  liquidators may
      determine.


                                       27
<PAGE>

147   On any  sale  of the  Company  or its  assets  through  a  liquidation  or
      winding-up,  a Special  Majority of the  Shareholders  voting at a General
      Meeting may authorize the Board of Directors or liquidators to:

      (a)   accept fully or partly paid up Shares,  debentures, or other Company
            securities,  whether registered in Israel or in other jurisdictions,
            whether existing or contingent, for the purchase in whole or in part
            of Company  property  and,  if the  profits of the  Company  permit,
            distribute  such shares,  securities or any other  Company  property
            among the Shareholders without requiring their realization,  or vest
            the same in trustees for their benefit; and/or

      (b)   distribute  or  appropriate  the  Company's  cash,   Shares,   other
            securities,  benefits  or  property  as so  approved  at the General
            Meeting.  In such case, all Shareholders will be bound to accept any
            valuation on distribution  so authorized,  and will waive all rights
            in relation to such valuation,  except where  otherwise  required by
            law.

                             Amendments to Articles

148.  These  Articles  may be  amended,  in  whole or in  part,  by an  Ordinary
      Majority of the Shareholders voting at a General Meeting.


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