---

---

EXHIBIT 1.1

# THE COMPANIES LAW 1999

# A COMPANY LIMITED BY
SHARES

# ARTICLES OF
ASSOCIATION OF

# AREL COMMUNICATIONS
AND SOFTWARE LTD.

Interpretation;
General

|1. | In these Articles of Association, unless the context otherwise requires:
|-- | ------------------------------------------------------------------------

| | 1.1. | Articles  means
the articles of association of the Company (as           defined below), as shall be in
force from time to time.
| | ---- | -----------------------------------------------------------------------------------------------------------------------------------

| | 1.2. | Board
of Directors  means the board of directors of the           Company as
appointed from time to time in accordance with the Articles.
| | ---- | --------------------------------------------------------------------------------------------------------------------------------------------

| | 1.3. | Business
Day- means Sunday through Thursday excluding any public           holidays on which
the branches of the three major banks in Israel are closed to           the public.
| | ---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 1.4. | Companies
Law  means the Israeli Companies Law, 5759-1999, as           amended from
time to time including any regulations promulgated thereunder.
| | ---- | ------------------------------------------------------------------------------------------------------------------------------------------------------

| | 1.5. | Companies
Ordinance  means the relevant sections of the           Companies Ordinance
(New Version), 5743-1983, as currently in effect and as may           be amended from
time to time and any regulations promulgated by virtue thereof.
| | ---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 1.6. | Company  means
Arel Communications and Software Ltd.
| | ---- | -------------------------------------------------------

| | 1.7. | General
Meeting  means the annual general meeting of the           Companys
shareholders and any other duly convened meeting of the           Companys
shareholders.
| | ---- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 1.8. | law  shall
include the rules and regulations of any securities           exchange or national market
system to which the Company is subject.
| | ---- | -----------------------------------------------------------------------------------------------------------------------------------------------

| | 1.9. | Office  means
the office of the Company as recorded with the           Israeli Registrar of Companies.
| | ---- | ---------------------------------------------------------------------------------------------------------

| | 1.10. | Office
Holder  means any person who fits the definition of a           Nosei
Misra in Section 1 of the Companies Law.
| | ----- | --------------------------------------------------------------------------------------------------------------------------

| | 1.11. | Ordinary
Majority  means an ordinary majority of all the votes           of the
shareholders present and entitled to vote at a particular meeting or           class
meeting of the Company, as applicable, without taking into account the           votes of
abstainees.
| | ----- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



---

---



| | 1.12. | Personal
Interest  shall have the meaning defined in Section 1           of the
Companies Law.
| | ----- | -------------------------------------------------------------------------------------------------

| | 1.13. | Register  means
the official share register of the Company           kept pursuant to Sections 130  134
of the Companies Law and including an           Additional Register kept
pursuant to Section 138 of the Companies           Law. For the avoidance of doubt, the
list of shareholders kept by the           Companys transfer agent regarding the
holder(s) of the Companys           securities, shall be deemed an Additional
Register for the purposes           of these Articles.
| | ----- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 1.14. | Shareholder  means
any individual or entity that is the holder           of shares in the Company, as
registered in the Register. Notwithstanding the           foregoing, the Board of
Directors may recognize in its discretion a beneficial           owner of shares in place
of the holder registered in the Register, upon the           submission, by the
individual or entity claiming such beneficial ownership, of           sufficient proof of
ownership to the satisfaction of the Board of Directors.
| | ----- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|2. | Unless
the subject or the context otherwise requires: (i) words and expressions
          defined in the Companies Law shall have the same meanings herein; (ii) words
and           expressions importing the singular shall include the plural and vice versa;
          (iii) words and expressions importing the masculine gender shall include the
          feminine gender and vice versa; (iv) words and expressions importing persons
          shall include bodies corporate; (v) the word or is not exclusive;
          (vi) the word including shall mean including, without limitation;
          (vii) the terms these Articles, hereof,           hereunder,
herein and similar expressions refer to these           Articles as a whole,
and not to any particular Article, subsection or other           portion hereof; (viii)
all references in these Articles to Dollars          or $ shall
mean United States Dollars; all references to           NIS shall mean New
Israeli Shekels; the term Writing or           any term of like import
includes words typewritten, printed, painted, engraved,           lithographed,
photographed or represented or reproduced by any mode of           reproducing words in a
visible form, including telex, facsimile, telegram, cable           or other form of
writing produced by electronic communication.
|-- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|3. | The
captions in these Articles are for convenience only and shall not be deemed           a
part hereof or affect the construction of any provision hereof. The specific
          provisions of these Articles shall supersede the provisions of the Companies
Law           and the Companies Ordinance, as applicable, to the extent permitted under
the           Companies Law and the Companies Ordinance, as applicable. With respect to
any           matter that is not specifically addressed in these Articles, the provisions
of           the Companies Law and the Companies Ordinance, as applicable, shall govern.
|-- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Name
of the Company

|4. | The
name of the company is as follows:
|-- | --------------------------------------

| | 4.1. | In
Hebrew:
| | ---- | ----------

| | 4.2. | In
English: Arel Communications and Software Ltd.
| | ---- | -------------------------------------------------



---

---



Purpose

|5. | The
purpose of the Company is to engage in any lawful act or activity for which
          companies may be organized under the Companies Law.
|-- | ---------------------------------------------------------------------------------------------------------------------------------------------

Limitation
of Liability

|6. | The
liability of each Shareholder for the Companys obligations is limited           to
the unpaid sum, if any, owing to the Company in consideration for the           issuance
of the shares held by such Shareholder.
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Authorized
Capital

|7. | The
authorized share capital of the Company is NIS 30,000.00 divided into
          30,000,000 Ordinary Shares, nominal value NIS 0.001 per share (Ordinary
          Shares). The Company may alter the authorized share capital in accordance
          with the terms of the Companies Law.
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Donations

|8. | The Board of Directors may donate reasonable amounts of money to worthy causes
          even if such donation is not within the framework of the Companys business
          considerations.
|-- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Modification
of Capital

|9. | Subject to the Companies Law, if at any time the share capital of the Company is
          divided into different classes of shares, the rights attached to any class,
          unless otherwise provided by these Articles, may be modified or abrogated by the
          Company by an Ordinary Majority at a General Meeting. Subject to the Companies
          Law, the provisions of these Articles relating to General Meetings shall,
          mutatis mutandis, apply to any separate meeting of the holders of the shares of
          a particular class.
|-- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Consolidation,
Subdivision, Cancellation and Reduction of Share Capital

| | 10. | With respect to any consolidation of issued shares into shares of larger nominal
               value, and with respect to any other action which may result in fractional
               shares, the Board of Directors may settle any difficulty which may arise with
               regard thereto, as it deems fit, and, inter alia, may resort to one or more of
               the following actions:
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 10.1. | determine, as to the holder of shares so consolidated, which issued shares shall
               be consolidated into each share of larger nominal value;
| | ----- | --------------------------------------------------------------------------------------------------------------------------------------------------------

| | 10.2. | allot, in contemplation of or subsequent to such consolidation or other action,
               such shares or fractional shares sufficient to preclude or remove fractional
               share holdings;
| | ----- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 10.3. | redeem, in the case of redeemable preference shares, and subject to applicable
               law, such shares or fractional shares sufficient to preclude or remove
               fractional share holdings;
| | ----- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



---

---



| | 10.4. | cause the transfer of fractional shares by certain shareholders of the Company
               to other shareholders thereof so as to most expediently preclude or remove any
               fractional shareholdings, and cause the transferees to pay the transferors the
               fair value of fractional shares so transferred, and the Board of Directors is
               hereby authorized to act as agent for the transferors and transferees with power
               of substitution for purposes of implementing the provisions of this
               Article 10.4.
| | ----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Allotment
of Shares

|11. | Subject to the provisions of these Articles, the unissued shares of the Company
          shall be at the disposal of the Board of Directors who may without limiting or
          affecting any rights previously conferred on the holders of any existing shares,
          offer, allot, grant options over or otherwise dispose of shares or other
          securities convertible into shares of the Company, to such persons, at such
          times and upon such terms and conditions as the Company may by resolution of the
          Board of Directors determine.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|12. | The Board of Directors may, subject to the provisions of the Companies Law,
          issue redeemable securities and redeem the same.
|--- | --------------------------------------------------------------------------------------------------------------------------------------

Issuance
of Share Certificates; Replacement of Lost Certificates

|13. | Share certificates shall bear the signature of a director or of any other person
          or persons authorized with respect thereto by the Board of Directors.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------

|14. | Each Shareholder shall be entitled to one numbered certificate for all the
          shares of any class registered in such Shareholders name, and if the Board
          of Directors so approves, to several certificates, each for one or more of such
          shares. Each certificate shall specify their nominal value, the serial numbers
          of the shares represented thereby and may also specify the amount paid up
          thereon.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|15. | A share certificate registered in the names of two or more persons shall be
          delivered to the person first named in the Register in respect of such
          co-ownership.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|16. | If a share certificate is defaced, lost or destroyed, it may be replaced, upon
          payment of such fee, and upon the furnishing of such evidence of ownership and
          such indemnity, as the Board of Directors may think fit.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Registered
Holder

|17. | Except as otherwise provided in these Articles, the Company shall be entitled to
          treat any Shareholder as the absolute owner thereof, and, accordingly, shall
          not, except as ordered by a court of competent jurisdiction, or as required by
          statute, be bound to recognize any equitable or other claim to, or interest in
          such share on the part of any other person.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Payments
for Shares

|18. | All the shares in the Companys issued capital shall be fully paid up
          shares, unless decided otherwise by the Board of Directors.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------



---

---



Forfeiture
and Surrender

19.

| | 19.1. | If any shareholder fails to pay any amount payable in respect of a share, or
               interest thereon, on or before the day fixed for payment of the same, the
               Company, by resolution of the Board of Directors, may at any time thereafter, so
               long as the said amount or interest remains unpaid, forfeit all or any of the
               shares in respect of which such payment shall have been made. Any expense
               incurred by the Company in attempting to collect any such amount or interest,
               including, inter alia, attorneys fees and costs of suit, shall be added
               to, and shall, for all purposes (including the accrual of interest thereon),
               constitute a part of the amount payable to the Company in respect of such
               shares.
| | ----- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 19.2. | Upon the adoption of a resolution of forfeiture, the Board of Directors shall
               cause notice thereof to be given to such shareholder, which notice shall state
               that, in the event of the failure to pay the entire amount so payable within a
               period stipulated in the notice (which period shall not be less than fourteen
               (14) days and which may be extended by the Board of Directors), such shares
               shall be ipso facto forfeited, provided, however, that, prior to the expiration
               of such period, the Board of Directors may nullify such resolution of
               forfeiture, but no such nullification shall stop the Board of Directors from
               adopting a further resolution of forfeiture in respect of the non-payment of the
               same amount.
| | ----- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 19.3. | Whenever shares are forfeited as herein provided, all dividends theretofore
               declared in respect thereof and not actually paid shall be deemed to have been
               forfeited at the same time.
| | ----- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 19.4. | The Company, by resolution of the Board of Directors, may accept the voluntary
               surrender of any share.
| | ----- | ---------------------------------------------------------------------------------------------------------------------

| | 19.5. | Any share forfeited or surrendered as provided herein shall become the property
               of the Company, and the same, subject to the provisions of these Articles, may
               be sold, re-allotted or otherwise disposed of as the Board of Directors thinks
               fit.
| | ----- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 19.6. | Any shareholder whose shares have been forfeited or surrendered shall cease to
               be a shareholder in respect of the forfeited or surrendered shares, but shall,
               notwithstanding, be liable to pay, and shall forthwith pay, to the Company, all
               moneys, interest and expenses owing upon or in respect of such shares at the
               time of forfeiture or surrender, together with interest thereon from the time of
               forfeiture or surrender until actual payment, and the Board of Directors, in its
               discretion, may enforce the payment of such moneys, or any part thereof, but
               shall not be under any obligation to do so. In the event of such forfeiture or
               surrender, the Company, by resolution of the Board of Directors, may accelerate
               the date(s) of payment of any or all amounts then owing by the shareholder in
               question (but not yet due) in respect of all shares owned by such shareholder,
               solely or jointly with another, and in respect of any other matter or
               transaction whatsoever.
| | ----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



---

---



| | 19.7. | The Board of Directors may at any time, before any share so forfeited or
               surrendered shall have been sold, re-allotted or otherwise disposed of, nullify
               the forfeiture or surrender on such conditions as it thinks fit, but no such
               nullification shall stop the Board of Directors from re-exercising its powers of
               forfeiture pursuant to this Article 19.
| | ----- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 19.8. | Upon any sale of shares after forfeiture or surrender, the Board of Directors
               may appoint a person to execute an instrument of transfer of the shares so sold
               and cause the purchasers name to be entered in the Register in respect of
               such shares, and the purchaser shall not be bound to see to the regularity of
               the proceedings, or to the application of the purchase money, and after such
               purchasers name has been entered in the Register in respect of such
               shares, the validity of the sale shall not be impeached by any person, and the
               remedy of any person aggrieved by the sale shall be in damages only and against
               the Company exclusively.
| | ----- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Transfer
of Shares

|20. | No transfer of shares shall be registered unless a proper instrument of transfer
          (in form and substance satisfactory to the Board of Directors) has been
          submitted to the Company, together with the share certificate(s) and such other
          evidence of title as the Board of Directors may reasonably require. Subject to
          the terms of these Articles, the effectiveness of such transfer of shares shall
          not require the prior approval of the Board of Directors.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|21. | All transfers of shares shall be made in writing in the form appearing herein
          below, or in a similar form, or in any form approved by the Board of Directors
          from time to time:
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Share
Transfer Deed
| | --------------------

| | I,
_____________, of __________________, for valuable consideration paid to me by
______________ of ___________________ (Transferee), do hereby transfer
to the Transferee _____ share(s), nominal value ______ each, numbered ________ to
_________ (inclusive), of Arel Communications and Software Ltd. to hold unto the
Transferee, his executors, administrators and assigns, subject to the same terms and
conditions on which I held the same at the time of the execution hereof; and I, the said
Transferee, do hereby agree to take the said share(s) subject to the aforesaid terms and
conditions.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | In
witness whereof we have hereunto set our hands this ____ day of _______, ____.
| | ---------------------------------------------------------------------------------

|__________________ 
Transferee         
_______________    
Witness | _________________
Transferor
________________
Witness"
|------------------------------------------------------------------- | ------------------------------------------------------

| | Such
form shall be executed both by the transferor and transferee, and delivered to the Office
(or any other placed determined by the Board of Directors) together with the transferred
share certificates, if share certificates have been issued with respect to the shares to
be transferred, and any other proof of the transferors title that the Board of
Directors may require. A deed of transfer that has been registered, or a copy thereof, as
shall be decided by the Board of Directors, shall remain with the Company. Any deed of
transfer that the Board of Directors shall refuse to register shall be returned, upon
demand, to the person who furnished it to the Company, together with the share
certificate, if furnished.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



---

---



|22. | Subject to the provisions of the Companies Law, the transferor shall be deemed
          to remain a Shareholder until the name of the transferee is entered into the
          Register in respect thereof.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|23. | The Company may impose a fee for registration of a share transfer, at a
          reasonable rate as may be determined by the Board of Directors from time to
          time.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Transmission
of Shares

|24. | Decedents Shares. Subject to applicable law, any person
          becoming entitled to a share in consequence of the death of any person, upon
          producing evidence of the grant of probate or letters of administration or
          declaration of succession (or such other evidence as the Board of Directors may
          reasonably deem sufficient that he sustains the character in respect of which he
          proposes to act under this Article 24 or of his title), shall be registered as a
          shareholder in respect of such share, or may, subject to the regulations as to
          transfer herein contained, transfer such share.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|25. | Receivers and Liquidators. Subject to applicable law, the
          Company may recognize the receiver or liquidator of any corporate Shareholder in
          winding-up or dissolution, or the receiver or trustee in bankruptcy of any
          Shareholder, as being entitled to the shares registered in the name of such
          Shareholder. Subject to applicable law, the receiver or liquidator of a
          corporate Shareholder in winding-up or dissolution, or the receiver or trustee
          in bankruptcy of any Shareholder, upon producing such evidence as the Board of
          Directors may deem sufficient that he sustains the character in respect of which
          he proposes to act under this Article 25 or of his title, shall be registered as
          a Shareholder in respect of such shares, or may, subject to the regulations as
          to transfer herein contained, transfer such shares.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Record
Date for General Meetings

|26. | The Shareholders entitled to receive notice of, to participate in and to vote
          thereon at a General Meeting, or to express consent to or dissent from any
          corporate action in writing, shall be determined by the Board of Directors
          subject to the restrictions set forth under the Companies Law. A determination
          of shareholders of record with respect to a General Meeting shall apply to any
          adjournment of such meeting.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

General
Meetings

|27. | Annual General Meeting. An Annual General Meeting shall be
          held once in every calendar year at such time as is required in accordance with
          applicable law and at such place either within or without the State of Israel as
          may be determined by the Board of Directors and shall deliberate over the
          matters required by the Companies Law or any other applicable law.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



---

---



|28. | Extraordinary General Meetings. All General Meetings other
          than Annual General Meetings shall be called Extraordinary General
          Meetings. The Board of Directors may, whenever it thinks fit, convene
          an Extraordinary General Meeting at such time and place, within or without the
          State of Israel, as may be determined by the Board of Directors, and shall be
          obligated to do so upon requisition in writing in accordance with Section 63 of
          the Companies Law. The Shareholders of the Company may convene an Extraordinary
          General Meeting in accordance with Section 64 of the Companies Law.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|29. | Notice of General Meetings. Subject to the Companies Law,
          not less than twenty one (21) days prior notice shall be given of
          every General Meeting (the Notice). The Notice shall specify
          the place, date and hour of the General Meeting, its agenda, a summary of
          proposed resolutions, the procedure for voting in such General Meeting by proxy
          and any other matter as shall be required by law. Notices shall be sent to each
          of the Shareholders. The accidental omission to provide notice to any
          Shareholder or the non-receipt of notice sent to a Shareholder, shall not
          invalidate the proceedings of a General Meeting.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Proceedings
at General Meetings

|30. | Quorum. Two or more Shareholders (not in default in payment
          of any sum referred to in these Articles), present in person or by proxy and
          holding shares conferring in the aggregate the minimum amount of voting power of
          the Company required by applicable law to constitute a quorum at General
          Meetings, shall constitute a quorum at General Meetings. No business shall be
          transacted at a General Meeting, or at any adjournment thereof, unless the
          requisite quorum is present when the meeting proceeds to business. If within a
          half hour from the time appointed for the meeting a quorum is not present, the
          General Meeting, if convened upon requisition under Sections 63 or 64 of
          the Companies Law, shall be dissolved, but in any other case it shall stand
          adjourned for one week, to the same day, time and place, without it being
          necessary to notify the Shareholders of such or such other time and place as
          specified in the Notice or to such later day and at such time and place as the
          Chairman of the General Meeting may determine with the consent of an Ordinary
          Majority. If a quorum is not present at the adjourned meeting within half and
          hour of the time fixed for the commencement thereof, subject to the provisions
          of applicable law, the persons present shall constitute a quorum. No business
          shall be transacted at any adjourned meeting except business that might lawfully
          have been transacted at the meeting as originally called.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|31. | Chairman. The Chairman of the Board of Directors shall
          preside as Chairman at every General Meeting of the Company. If at any meeting
          such Chairman is not present within fifteen (15) minutes after the time fixed
          for holding the meeting or is unwilling to act as chairman of the meeting and
          all subject to the Board of Directors not having previously appointed someone
          else to serve as chairman for such meeting, the Shareholders present shall
          choose someone of their member to serve as chairman of the meeting.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|32. | Adoption of Resolutions at General Meetings.
|--- | --------------------------------------------

| | 32.1. | Unless
otherwise specifically provided in these Articles or under any applicable           law,
all resolutions submitted to the Shareholders shall be deemed adopted if
          approved by an Ordinary Majority.
| | ----- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



---

---



| | 32.2. | The
Board of Directors may determine, in its discretion, the matters that may be
          voted at the General Meeting by proxy as shall be permitted, in accordance with
          Section 87 of the Companies Law.
| | ----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 32.3. | Every
question submitted to a General Meeting shall be decided by a count of           votes.
| | ----- | ---------------------------------------------------------------------------------------------

| | 32.4. | Minutes
of each meeting of the Shareholders shall be recorded and duly entered           in books
provided for that purpose. Such minutes shall, in all events, set forth           the
names of the persons present at the meeting and all resolutions adopted
          thereat. Any minutes as aforesaid, if purporting to be signed by the Chairman
of           the General Meeting shall constitute prima facie evidence of the matters
          recorded therein.
| | ----- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|33. | Power to Adjourn. The Chairman of a General Meeting at
          which a quorum is present may, with the consent of an Ordinary Majority (and
          shall if so directed by the meeting), adjourn the meeting from time to time and
          from place to place, but no business shall be transacted at any adjourned
          meeting except business which might lawfully have been transacted at the meeting
          as originally called. It shall not be necessary to give any notice of an
          adjournment unless the meeting is adjourned for twenty-one (21) days or more, in
          which event notice thereof shall be given in the manner required for the meeting
          as originally called.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|34. | Voting Power. Subject to any provision hereof conferring
          special rights as to voting, or restricting the right to vote, every Shareholder
          shall have one vote for each share held by such Shareholder of record, on every
          resolution, without regard to whether the vote hereon is conducted by a show of
          hands, by proxy or by any other means.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|35. | Voting Rights.
|--- | --------------

| | 35.1. | Subject
to the terms of applicable law, the right of a Shareholder to vote at           any
General Meeting (or be counted as a part of the quorum thereat), shall be
          subject to regulations and procedures with regard to proof of title to the
          Companys shares prescribed by the Board of Directors.
| | ----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 35.2. | A
company or other corporate body that is a Shareholder of the Company may, by
          resolution of its directors or any other managing body thereof, authorize any
          person to be its representative at any General Meeting. Any person so
authorized           shall be entitled to exercise on behalf of such Shareholder all the
power that           such Shareholder could have exercised if such Shareholder were an
individual.           Upon the request of the Chairman of the General Meeting, written
evidence of           such authorization (in form acceptable to the Chairman) shall be
delivered to           the Chairman.
| | ----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 35.3. | Any
Shareholder entitled to vote may vote either personally or by proxy (who           need
not be a Shareholder of the Company), or, if the Shareholder is a company           or
other corporate body, by a representative authorized pursuant to           Article 35.2.
| | ----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 35.4. | If
two or more persons are registered as joint holders of any share, the vote of
          the senior who tenders a vote, in person or by proxy, shall be accepted to the
          exclusion of the vote(s) of the other joint holder(s); and for this purpose
          seniority shall be determined by the order in which the names stand in the
          Register. Separate guardians or separate executors of estates of a deceased
          registered shareholder shall be deemed, for the purposes of this Article 35.4,
          as joint Shareholders in such cases.
| | ----- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



---

---



|36. | Proxy. The instrument appointing a proxy shall be in
          writing and shall be substantially in the following form:
|--- | ------------------------------------------------------------------------------------------------------------------------

| | I
_________________ (Name of Shareholder) of _______________________ (Address of
Shareholder) being a shareholder of Arel Communications and Software Ltd., hereby appoint
___________ (Name of Proxy) of _______________________ (Address of Proxy) as my proxy to
vote for me in my name and stead in respect of ______ shares of ______ class which are
held by me, at the General Meeting of the Company to be held on the _____ day of ______,
20__ and at any adjournment(s) thereof.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Signed
this ______ day of ____________, 20__.
| | ---------------------------------------------

| | ___________________________(Signature
of Appointer)
| | ----------------------------------------------------

| | or
in any usual or common form or in such other form as may be approved by the Board of
Directors including an instrument effected through the internet or any other electronic
medium and including a form which provides for a continuing proxy until the occurrence of
such date or event as is specified in the proxy. Such instrument shall be duly signed by
the appointer or his duly authorized attorney or, if such appointer is a company or other
corporate body, under its common seal or stamp or the hand of its duly authorized agent(s)
or attorney(s). The Board of Directors may demand that the Company be given written
confirmation, to its satisfaction, that the given signatories have the authority to bind
the corporate body of the appointing Shareholder.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | The
instrument appointing a proxy (and the power of attorney or other authority, if any, under
which such instrument has been signed) shall be delivered to the Company (at its Office,
or at its principal place of business or at the offices of its registrar and/or transfer
agent and/or by e-mail to the address of the Company and/or by e-mail to the address of
the transfer agent, or at such place and by such means of communication, as the Board of
Directors may specify) before the time fixed for the meeting at which the person named in
the instrument proposes to vote.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|37. | Effect of Death of Appointer or Revocation of Appointment.
          Subject to applicable law, a vote cast pursuant to an instrument appointing a
          proxy shall be valid notwithstanding the previous death, liquidation or
          winding-up of the appointing Shareholder (or of his attorney-in-fact, if any,
          who signed such instrument), or the revocation of the appointment or the
          transfer of the share in respect of which the vote is cast, provided no written
          intimation of such death, liquidation, winding-up or revocation only shall have
          been received by the Company or by the Chairman of the General Meeting before
          such vote is cast and provided, further, that the appointing Shareholder, if
          present in person at said meeting, may revoke the appointment by means of a
          writing, oral notification to the Chairman of the General Meeting, or otherwise,
          to the satisfaction of the Chairman of the General Meeting.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



---

---



Board
of Directors

|38. | Powers of Board of Directors. The Board of Directors shall
          determine the Companys policies, oversee the activities of the Chief
          Executive Officer, and take such other actions as are described in these
          Articles, Section 92 of the Companies Law or any other applicable law. In the
          absence of a Chief Executive Officer, the Board of Directors shall manage the
          business of the Company. The authority conferred on the Board of Directors by
          this Article 38 shall be subject to the provisions of the Companies Law, of
          these Articles and any regulation or resolution consistent with these Articles
          adopted from time to time by the Company in a General Meeting, provided,
          however, that no such regulation or resolution shall invalidate any prior act
          done by or pursuant to a decision of the Board of Directors which would have
          been valid if such regulation or resolution had not been adopted.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|39. | Exercise of Powers of Directors. A meeting of the Board of
          Directors at which a quorum is present shall be competent to exercise all the
          authorities, powers and discretions vested in or exercisable by the Board of
          Directors. A resolution proposed at any meeting of the Board of Directors shall
          be deemed adopted if approved by a majority of the Directors present when such
          resolution is put to a vote and voting thereon, without taking into account the
          votes of abstainees and with each director entitled to only one vote. The
          Chairman of the Board of Directors will not have an additional or casting vote,
          in the case of a tie or otherwise.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|40. | Delegation of Powers. Subject to applicable law, the Board
          of Directors may delegate any or all of its powers to committees, each
          consisting of two or more persons, and it may from time to time revoke such
          delegation or alter the composition of any such committee. Any Committee so
          formed (in these Articles referred to as a Committee of the Board of
          Directors), shall, in the exercise of the powers so delegated, conform
          to any regulations imposed on it by the Board of Directors. The meetings and
          proceedings of any such Committee of the Board of Directors shall, mutatis
          mutandis, be governed by the provisions herein contained for regulating the
          meetings of the Board of Directors, so far as not superseded by any regulations
          adopted by the Board of Directors under this Article 40. Unless otherwise
          expressly provided by the Board of Directors in delegating powers to a Committee
          of the Board of Directors, such Committee of the Board of Directors shall not be
          empowered to further delegate such powers.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|41. | Number of Directors. The number of directors serving on the
          Board of Directors may be determined from time to time by the Board of Directors
          or at a General Meeting, provided however that the overall number of directors
          at a given time shall not be less than 2 (two) and not more than 11 (eleven),
          including 2 (two) outside directors appointed in accordance with the
          terms of the Companies Law.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|42. | Election and Removal of Directors. With the exception of
          the election of outside directors which shall be governed in
          accordance with the provisions of the Companies Law, directors shall be elected
          at the Annual General Meeting by an Ordinary Majority. The directors so elected
          shall hold office until the next Annual General Meeting unless determined
          otherwise at a subsequent General Meeting. Notwithstanding the aforesaid, if no
          directors are appointed at the Annual General Meeting, the directors appointed
          at the previous Annual General Meeting shall continue to hold office. With the
          exception of the removal of outside directors which shall be
          governed in accordance with the provisions of the Companies Law, at a General
          Meeting by an Ordinary Majority, the Shareholders shall be entitled to remove
          any director(s) from office, to elect directors in place of the director(s) so
          removed or to fill any vacancy, however created, including a vacancy resulting
          from an enlargement of the Board of Directors by resolution of the Board of
          Directors, on the Board of Directors.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



---

---



|43. | Continuing Directors in the Event of Vacancies. Subject to
          Article 41, any vacancy in the Board of Directors, however occurring, including
          a vacancy resulting from an enlargement of the Board of Directors by resolution
          of the Board of Directors, may be filled by a vote of a majority of the
          directors then in office, even if less than a quorum. A director elected by the
          Board of Directors in accordance with this Article 43 shall be elected to hold
          office until the next Annual General Meeting.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|44. | Vacation of Office. The office of a director shall be
          vacated by the directors written resignation in accordance with the
          procedure set forth by applicable law. Such resignation shall become effective
          on the date fixed therein, or upon the delivery thereof to the Company,
          whichever is later. With the exception of the vacation of the office of an
          outside director which shall be governed in accordance with the
          provisions of the Companies Law, the office of a director shall be vacated, ipso
          facto, upon the occurrence of any of the following: (i) such directors
          death, (ii) such director is convicted of a crime as described in Section 232 of
          the Companies Law, (iii) such director is removed by a court of law in
          accordance with Section 233 or the Companies Law, (iv) such director becomes
          legally incompetent, (v) if such director is an individual, such director is
          declared bankrupt, or (vi) if such director is a corporate entity, upon its
          winding-up liquidation, whether voluntary or involuntary.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|45. | Remuneration of Directors. The Company is entitled to
          compensate the members of the Board of Directors for their services as directors
          provided that such remuneration shall have been approved pursuant to the
          provisions of the Companies Law and in the case of outside
          directors, the Company must compensate its outside directors
          pursuant to the provisions of the Companies Law. The Company may reimburse
          directors for their reasonable expenses for traveling, board and lodging and
          other expenses connected with their participation at meetings of the Board of
          Directors and the performance of their position as directors. The Company may
          pay additional remuneration to a director who has been asked to provide special
          services to the Company or who makes special efforts for the Company, subject to
          approval pursuant to the provisions of the Companies Law.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|46. | Alternate Directors. A director may, by written notice to
          the Company, appoint an alternate for himself (in these Articles referred to as
          an Alternate Director), remove such Alternate Director
          and appoint another Alternate Director in place of any Alternate Director
          appointed by him for any reason. Unless the appointing director, by the
          instrument appointing an Alternate Director or by written notice to the Company,
          limits such appointment to a specified period of time or restricts it to a
          specified meeting or action of the Board of Directors, or otherwise restricts
          its scope, or revokes such appointment, the appointment shall be for an
          indefinite period, and for all purposes. Any notice given to the Company
          pursuant to this Article 46 shall become effective on the date fixed
          therein, or upon the delivery thereof to the Company, whichever is later. An
          Alternate Director shall have all the rights and obligations of the director who
          appointed him, provided, however, that he may not in turn appoint an alternate
          for himself (unless the instrument appointing him otherwise expressly provides),
          and provided further that an Alternate Director shall have no standing at any
          meeting of the Board of Directors or any Committee of the Board of Directors
          while the director who appointed him is present. One person may not act as
          Alternate Director for more than one director. The identity of an Alternate
          Director shall be subject to the restrictions set forth in the Companies Law for
          directors and the office of an Alternate Director shall be vacated under the
          circumstances, mutatis mutandis, set forth in Article 44, and such office shall
          ipso facto be vacated if the director who appointed such Alternate Director
          ceases to be a director.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



---

---



Proceedings
of the Board of Directors

|47. | Meetings.The Board of Directors may meet and adjourn its meetings
          and otherwise regulate such meetings and proceedings as the directors think fit,
          provided that the Board of Directors shall convene at least once in each
          calendar quarter. A meeting of the Board of Directors may be called in
          accordance with Section 98 of the Companies Law and its agenda shall be set in
          accordance with Section 99 of the Companies Law. All meetings of the Board of
          Directors must provide not less than two (2) Business Days prior written
          notice of any meeting, specifying the place, date, hour and detailed agenda of
          such meeting, unless such notice is waived in writing by all of the directors as
          to a particular meeting. The Company may require each director to provide it
          with a fax number or e-mail address to which the Company may send notices and
          which shall be deemed to have been received by such director upon transmission.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|48. | Quorum. Until otherwise unanimously decided by the Board of
          Directors, a quorum at a meeting of the Board of Directors shall be constituted
          by the presence, in person or by any other means of communication by which the
          directors may hear each other simultaneously, of a majority of the directors
          then in office who are lawfully entitled to participate in the meeting and vote
          thereon (as conclusively determined by the Chairman of the Board of Directors).
          If within half an hour from the time appointed for the meeting a quorum is not
          present, the meeting shall stand adjourned to such time, date and place as the
          Chairman may determine, provided that not less than two (2) Business Days
          prior written notice shall have been provided to each of the directors of such
          meeting. No business shall be transacted at any adjourned meeting except
          business that might lawfully have been transacted at the meeting as originally
          called. At such adjourned meeting, two (2) members of the Board of Directors
          present in person shall constitute a quorum.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|49. | Chairman of the Board of Directors. The Board of Directors
          may from time to time elect one of its members to be the Chairman, remove such
          Chairman from office and appoint another in its place. The Chairman shall
          preside at every meeting of the Board of Directors, but if he is not present
          within fifteen (15) minutes of the time fixed for the meeting, or if the
          appointed Chairman is unwilling to take the chair, the directors present shall
          choose one of their number to be the chairman of such meeting.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|50. | Validity of Acts Despite Defects. Subject to the provisions
          of the Companies Law, all acts done bona fide at any meeting of the Board of
          Directors, or of a Committee of the Board of Directors, shall be as valid as if
          there were no such defect or disqualification notwithstanding that it may
          afterwards be discovered that there was some defect in the appointment of the
          participants in such meetings or any of them or any person(s) acting as
          aforesaid or that they or any of them were disqualified.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



---

---



|51. | Minutes. Minutes of each meeting of the Board of Directors
          (or any Committee of the Board of Directors) shall be recorded and duly entered
          in books provided for that purpose. Such minutes shall set forth the names of
          the persons present at the meeting and all resolutions adopted thereat. Any
          minutes as aforesaid, if purporting to be signed by the chairman of the meeting
          or by the chairman of a succeeding meeting, shall constitute prima facie
          evidence of the matters recorded therein.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Chief
Executive Officer

|52. | The Board of Directors shall appoint from time to time one or more persons, as
          Chief Executive Officers(s) of the Company and may confer upon such person(s),
          and from time to time modify or revoke, such title(s) (including General
          Manager, Managing Director, Director General or any similar or dissimilar
          title). The appointment of the Chief Executive Officer(s) may be either for a
          fixed term or without any limitation of time. Subject to the terms of the
          employment agreement of the Chief Executive Officer(s) and any applicable law,
          the Board of Directors may from time to time remove or dismiss the Chief
          Executive Officer(s) from office and appoint another or others in the Chief
          Executive Officer(s)s place.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|53. | Subject to the Companies Law and the terms set forth in these Articles, the
          Chief Executive Officer(s) shall manage the business of the Company pursuant to
          the policies established by the Board of Directors.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|54. | The Board of Directors may from time to time determine the Chief Executive
          Officer(s) salary and other terms and conditions of the Chief Executive
          Officers employment, subject to the terms of his employment agreement and
          the provisions of any applicable law.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Indemnification
and Insurance

|55. | Exemption From Duty of Care. Subject to the provisions of
          the Companies Law, including the receipt of all approvals as required therein or
          under any applicable law, the Company may resolve in advance to exempt an Office
          Holder from all or part of such Office Holders responsibility or liability
          for damages caused to the Company due to any breach of such Office Holders
          duty of care towards the Company.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|56. | Indemnification. Subject to the provisions of the Companies
          Law, including the receipt of all approvals as required therein or under any
          applicable law, the Company may indemnify any Office Holder to the fullest
          extent permitted by the Companies Law. Subject to the provisions of the
          Companies Law, including the receipt of all approvals as required therein or
          under any applicable law, the Company may resolve retroactively to indemnify an
          Office Holder with respect to the following liabilities and expenses, provided
          that such liabilities or expenses were incurred by such Office Holder in such
          Office Holders capacity as an Office Holder of the Company: (i) a monetary
          liability imposed on an Office Holder pursuant to a judgment in favor of another
          person, including a judgment imposed on such Office Holder in a compromise or in
          an arbitration decision that was approved by a court of law; (ii) reasonable
          legal expenses, including attorneys fees, which the Office Holder incurred
          or with which the Office Holder was charged by a court of law, in a proceeding
          brought against the Office Holder, by the Company or by another on behalf of the
          Company, or in a criminal prosecution in which the Office Holder was acquitted,
          or in a criminal prosecution in which the Office Holder was convicted of an
          offense that does not require proof of criminal intent; and (iii) any other
          obligation or expense for which it is or shall be permitted to indemnify an
          Office Holder. Subject to the provisions of the Companies Law including the
          receipt of all approvals as required therein or under any applicable law, the
          Company may resolve in advance to indemnify the Companys Office Holders
          for those liabilities and expenses described in this Article 56 (i), (ii) and
          (iii), provided that (i) in the opinion of the Board of Directors such
          liabilities and expenses can be foreseen at the time the undertaking to
          indemnify is provided, and (ii) the Board of Directors shall set a reasonable
          limit to the amounts for such indemnification under the circumstances.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



---

---



|57. | Insurance. Subject to the provisions of the Companies Law,
          including the receipt of all approvals as required therein or under any
          applicable law, the Company may enter into an agreement to insure an Office
          Holder for any liability that may be imposed on such Office Holder in connection
          with an act performed by such Office Holder in such Office Holders
          capacity an Office Holder of the Company, with respect to each of the following:
          (i) violation of the duty of care of the Office Holder towards the Company or
          towards another person; (ii) breach of the duty of loyalty towards the Company,
          provided that the Office Holder acted in good faith and with reasonable grounds
          to assume that the action in question was in the best interests of the Company;
          (iii) a financial obligation imposed on the Office Holder for the benefit of
          another person; and (iv) any other obligation or expense for which it is or
          shall be permitted to insure an Office Holder.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|58. | Articles 55, 56 and 57 shall not apply under any of the following circumstances:
          (i) a breach of an Office Holders duty of loyalty, in which the Office
          Holder did not act in good faith and with reasonable grounds to assume that the
          action in question was in the best interest of the Company; (ii) a grossly
          negligent or intentional violation of an Office Holders duty of care;
          (iii) an intentional action by an Office Holder in which such Office Holder
          intended to reap a personal gain illegally; and (iv) a fine or ransom levied on
          an Office Holder.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|59. | The Company may procure insurance for or indemnify any person who is not an
          Office Holder, including without limitation, any employee, agent, consultant or
          contractor, provided, however, that any such insurance or indemnification is in
          accordance with the provisions of these Articles and any applicable law.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Dividends

|60. | Declaration of Dividends. Subject to the provisions of the
          Companies Law, the Board of Directors may from time to time declare, and cause
          the Company to distribute, such dividends as may appear to the Board of
          Directors to be justified by the profits of the Company. Subject to the
          Companies Law, the Board of Directors shall determine the time for distribution
          of such dividends and the record date for determining the shareholders entitled
          thereto. The Shareholders entitled to receive dividends shall be the
          Shareholders on the date upon which it was resolved to distribute the dividends
          or at such later date as shall be provided in the resolution in question.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|61. | Implementation of Powers. The Board of Directors may settle
          any difficulty which may arise in regard to the distribution of dividends as it
          thinks expedient, and, in particular, may issue fractional certificates, and may
          determine that cash payments shall be made to any Shareholders upon the footing
          of the value so fixed, or that fractions of less value than the nominal value of
          one share may be disregarded in order to adjust the rights of all parties, and
          may vest any such cash with a trustee in trust for the persons entitled to the
          dividend or capitalized fund as may seem expedient to the Board of Directors.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



---

---



|62. | Deductions from Dividends. The Board of Directors may
          deduct from any dividend or other moneys payable to any Shareholder in respect
          of a share any and all sums of money then payable by such Shareholder to the
          Company on account of any matter or transaction.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|63. | Retention of Dividends. The Board of Directors may retain
          any dividend or other moneys payable or property distributable in respect of a
          share in respect of which any person is, under these Articles, entitled to
          become a Shareholder, or which any person is, under these Articles, entitled to
          transfer, until such person shall become a Shareholder in respect of such share
          or shall transfer the same.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|64. | Interest.No dividend or other benefit in respect of shares shall
          bear interest against the Company.
|--- | -------------------------------------------------------------------------------------------------------------

|65. | Mechanics of Payment. Any dividend or other moneys payable
          in cash in respect of a share may be paid by check sent through the post to, or
          left at, the registered address of the Shareholder or by transfer to a bank
          account specified by such person (or, if two or more persons are registered as
          joint holders of such share or are entitled jointly thereto in consequence of
          the death or bankruptcy of the holder or otherwise, to any one of such persons
          or to his bank account), or to such person and at such address as the person
          entitled thereto may by writing direct. Every such check shall be made payable
          to the order of the Shareholder, or to such person as the person entitled
          thereto as aforesaid may direct, and payment of the check by the banker upon
          whom it is drawn shall be a good discharge to the Company. Every such check
          shall be sent at the risk of the person entitled to the money represented
          thereby.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Rights
of Signature

|66. | The Board of Directors shall be entitled to authorize any person or persons (who
          need not be directors) to act and sign on behalf of the Company, and the
          signature of such person(s) on behalf of the Company, together with the
          Companys name in print or handwriting, shall bind the Company insofar as
          such person(s) acted and signed within the scope of such persons
          authority.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



---

---



Notices

|67. | All notices and other communications made pursuant to these Articles shall be in
          writing and shall be conclusively deemed to have been duly given: (i) in the
          case of hand delivery to the Address (as hereinafter defined), on the next
          business day after delivery in the country of delivery; (ii) in the case of
          delivery by an internationally recognized overnight courier to the Address,
          freight prepaid, on the next business day after delivery in the country of
          delivery; (iii) in the case of delivery by regular mail, delivery shall be
          deemed to have taken place at the time the letter would have been delivered in
          the ordinary course by mail, and no later than two days if mailed in the same
          country and no more than five days if sent to a place not located in the same
          country as the place from where it was posted and in each case commencing from
          the date on which the letter containing the notice as aforesaid was delivered to
          the post office; (iv) in the case of a notice sent by facsimile
          transmission to the Address, on the next business day after delivery in the
          country of delivery, if facsimile transmission is confirmed; or (v) in the case
          of a notice sent by email (or other form of electronic transmission) to the
          Address, on the date of transmission except where a notice is received by the
          Company stating that such mail has not been successfully delivered. The term
          Address means, (i) with respect to each Shareholder  such
          Shareholders mail address, facsimile number or email address, as the case
          may be, as specified in the Register; and (ii) with respect to the Company
           the address of the Office or the facsimile number or email address of the
          Chief Executive Office of the Company at the Office. A Shareholder may change or
          supplement the Address for service of any notice pursuant to these Articles, or
          designate additional addresses, facsimile numbers and email addresses for the
          purposes of this Article 67 by giving the Company a written notice of the new
          contact details in the manner set forth above. If a notice is, in fact, received
          by the addressee, it shall be deemed to have been duly served, when received,
          notwithstanding that it was defectively addressed or failed, in some respect, to
          comply with the provisions of this Article 67. All notices to be given to the
          Shareholders shall, with respect to any share to which persons are jointly
          entitled, be given to whichever of such persons is named first in the Register,
          and any notice so given shall be sufficient notice to the holders of such share.
          Any Shareholder whose address is not described in the Register, and who shall
          not have designated in writing an address for the receipt of notices, shall not
          be entitled to receive any notice from the Company. Whenever is it necessary to
          give prior notice of a number of days or notice which is valid for a particular
          period, the day of delivery shall be taken into account in reckoning the number
          of days or the period, unless otherwise determined. If notice is given in more
          than one of the manners specified above, it shall be deemed to have been
          received on the earliest date on which it is deemed to have been delivered, as
          provided above.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Merger

|68. | Approval of a merger as described in the Companies Law, shall
          require the approval of an Ordinary Majority at the General Meeting or at a
          class meeting, as the case may be, and all subject to the provisions of any
          applicable law.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Winding
Up

|69. | If the Company is wound up on liquidation or dissolution, then, subject to
          applicable law and the W(2)COM Liquidation Preference described in Article 70,
          all the assets of the Company available for distribution among the Shareholders
          shall be distributed to them in proportion to the sum paid on account of the
          nominal value of the shares held by them. A voluntary winding up of the Company
          shall require the approval set forth in the Companies Ordinance or any other
          approval as may be required by any applicable law.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|70. | Upon the winding up of the Company, the 3,681,818 ordinary shares of the Company
          issued to W2COM, LLC in August 2000 (or its assigns and successors
          in interest) and/or its affiliates (the W2COM
          Shares) shall be senior in liquidation to all of the other issued and
          outstanding ordinary shares of the Company with respect to the amount of $18.5
          million (the W2COM Loan Amount and the
          W2COM Liquidation Preference). The
          W2COM Liquidation Preference will terminate at such time that a
          registration statement registering the W2COM Shares has been
          declared effective by the SEC; provided, however, the W2COM
          Liquidation Preference shall terminate immediately in the event that (i) the
          holders of the W2COM Shares have sold to an unaffiliated third party such
          amount of W2COM Shares equal in value at the time of such sale(s)
          to the W2COM Loan Amount or (ii) the business acquired from
          W2COM, LLC and operated by the Company fails to achieve its revenue
          projections for the year 2000; provided that in the event of such failure, the
          W2COM Liquidation Preference shall be reduced only by a dollar
          amount equal to the dollar amount that such business failed to achieve such
          projections. Prior to is termination, at the time of each sale of any
          W2COM Shares to an unaffiliated third party, the W2COM
          Liquidation Preference shall be reduced by a dollar amount equal to the dollar
          amount for which the holder of such W2COM Shares has sold such
          W2COM Shares to an unaffiliated third party.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



---

---



Amendment
of these Articles

|71. | Any amendment of these Articles shall require the approval of an Ordinary
          Majority, in person or by proxy, as shall be permitted, and voting thereon in
          accordance with the provisions of the Companies Law. A resolution passed at a
          General Meeting by Ordinary Majority which amends any of the provisions set
          forth herein, shall be deemed a resolution to amend these Articles even if not
          expressly stated as such in the resolution or at the General Meeting.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Conflicting
Provisions

|72. | As of the date that these Articles were duly adopted by the Shareholders, these
          Articles automatically replace and amend any and all previously adopted articles
          of association of the Company.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



---

---