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EXHIBIT 1.2

|THE COMPANIES LAW, 1999 
|------------------------
|                        
|ARTICLES OF ASSOCIATION 
|OF                      
|POINTER TELOCATION  LTD.
|                        

PRELIMINARY

1.          Company
Name

The
name of the Company is Pointer Telocation Ltd. (the Company).

2.          Purpose

The
purpose of the Company shall be as detailed in the Memorandum of Association of
the Company.

3.          Interpretation

(a)          Unless
the subject or the context otherwise requires: 
(i) words and expressions defined in the Israeli Companies Law, 1999
(the Companies Law) in force on the date when these Articles or any amendment
thereto, as the case may be, first became effective shall have the same
meanings defined therein; (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 (iv) words and
expressions importing persons shall include corporate bodies.

(b)          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.

(c)          The
specific provisions of these Articles shall supercede the provisions of the
Companies Law to the extent permitted under the Companies Law.  With respect to any matter that is not
specifically addressed in these Articles, the provisions of the Companies Law
shall govern.

4.          Limitation
of Liability

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.

5.          Authorized
Share Capital

The share capital of the Company is
NIS 24,000,000 (twenty four million) divided into 8,000,000 (eight million) Ordinary
Shares, NIS 3.00 each (the Ordinary Shares).

6.          Ordinary
Shares

The
Ordinary Shares of the Company confer on the holders thereof rights to receive
notice of, attend, and vote in meetings of the shareholders, rights to receive
dividends, rights to receive a distribution of assets upon liquidation and
certain other rights all as are specified in these Articles.

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7.          Increase
of Share Capital

The
Company may, from time to time, increase its share capital by the creation of
new shares.  Any such increase shall be
in such amount and shall be divided into shares of such nominal amounts, and
such shares shall confer such rights and preferences, and shall be subject to
such restrictions, as the resolution approving the creation of such shares
shall provide.  Except to the extent
otherwise provided in the resolution creating such new shares, such new shares
shall be subject to all the provisions applicable to the shares of the original
capital.

8.          Special
Rights; Modifications of Rights

(a)         The
Company may, from time to time, provide for shares with such preferred or
deferred rights or rights of redemption or other special rights and/or such
restrictions, whether in regard to dividends, voting, repayment of share
capital or otherwise, as may be stipulated in the resolution pursuant to which
such shares are created.

(b)         (i)         If
at any time the share capital 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, subject to the consent in writing of,
or sanction of a resolution passed by, the holders of a majority of the issued
shares of such class at a separate General Meeting of the holders of the shares
of such class.

(ii)        The
provisions of these Articles relating to General Meetings shall, mutatis
mutandis, apply to any separate General Meeting of the holders of the shares of
a particular class; provided, however, that the requisite quorum at any such
separate General Meeting shall be two or more shareholders present in person or
proxy and holding not less than thirty-three and a third percent (331/3%)
of the issued shares of such class.

(iii)       Unless
otherwise provided by these Articles, the enlargement of an existing class of
shares, or the issuance of additional shares thereof, or the creation of a new
class of shares identical to an existing class of shares in all respects shall
not be deemed, for purposes of this Article 8(b), to modify or abrogate
the rights attached to the previously issued shares of such class or of any other
class.

9.          Consolidation,
Subdivision, Cancellation and Reduction of Share Capital

(a)        The
Company may, from time to time (subject, however, to the provisions of
Article 8(b) hereof and to applicable law):

(i)         consolidate
and divide all or any of its issued or unissued share capital into shares of
larger nominal value than its existing shares;

(ii)        subdivide
its shares (issued or unissued) or any of them, into shares of smaller nominal
value than is fixed by these Articles (subject, however, to the provisions of
the Companies Law), and the resolution whereby any share is subdivided may
determine that, as among the holders of the shares resulting from such subdivision,
one or more of the shares may, as compared with the others, have any such
preferred or deferred rights or rights of redemption or other special rights,
or be subject to any such restrictions, as the Company has power to attach to
unissued or new shares;

(iii)       cancel
any shares which, at the date of the adoption of such resolution have not been
taken or agreed to be taken by any person, and diminish the amount of its share
capital by the amount of the shares so cancelled; or

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(iv)         reduce
its share capital in any manner, subject to any authorization or consent
required by law.

(b)        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, including, inter alia, resort to one or more of the
following actions:

(i)          determine,
as to the holder of shares so consolidated, which issued shares shall be
consolidated into each share of larger nominal value;

(ii)          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;

(iii)         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;

(iv)         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
sub-Article 9(b)(iv).

SHARES

10.         Issuance
of Share Certificates; Replacement of Lost Certificates

(a)          Share
certificates shall bear the stamp or seal of the Company and shall bear the
signature of a Director or of any other person or persons authorized thereto by
the Board of Directors.

(b)          Each
shareholder shall be entitled to one numbered certificate for all the shares of
any class registered in his name, and if the Board of Directors so approves, to
several certificates, each for one or more of such shares.

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

(d)          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.

11.         Registered
Holder

Except
as otherwise provided in these Articles, the Company shall be entitled to treat
the registered holder of any share 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.

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12.         Allotment
of Shares

The
shares shall be under the control of the Board of Directors, who shall have the
power to allot shares or otherwise dispose of them to such persons, on such
terms and conditions, and at such times, as the Board of Directors may think
fit, and the power to give to any person the option to acquire from the Company
any shares, during such time and for such consideration as the Board of
Directors may think fit.

13.         Payment in
Installments

If
by the terms of allotment of any share, the whole or any part of the price
thereof shall be payable in installments, every such installment shall, when
due, be paid to the Company by the then registered holder(s) of the share of
the person(s) entitled thereto.

14.         Calls on
Shares

(a)          The
Board of Directors may, from time to time, make such calls as it may think
appropriate upon shareholders in respect of any sum unpaid in respect of shares
held by such shareholders which is not, by the terms of allotment thereof or
otherwise, payable at a fixed time, and each shareholder shall pay the amount
of every call so made upon him (and of each installment thereof if the same is
payable in installments), to the person(s) and at the time(s) and place(s)
designated by the Board of Directors, as any such time(s) may be thereafter
extended and/or such person(s) or place(s) changed.  Unless otherwise stipulated in the resolution of the Board of
Directors (and in the notice hereafter referred to), each payment in response
to a call shall be deemed to constitute a pro rata payment on account of all
shares in respect of which such call was made.

(b)          Notice
of any call shall be given in writing to the shareholder(s) in question not
less than fourteen (14) days prior to the time of payment, specifying the time
and place of payment, and designating the person to whom such payment shall be
made; provided, however, that before the time for any such payment, the Board
of Directors may, by notice in writing to such shareholder(s), revoke such call
in whole or in part, extend such time, or alter such person and/or place.  In the event of a call payable in
installments, only one notice thereof need be given.

(c)          If,
by the terms of allotment of any share or otherwise, any amount is made payable
at any fixed time, every such amount shall be payable at such time as if it
were a call duly made by the Board of Directors and of which due notice had
been given, and all the provisions herein contained with respect to such calls
shall apply to each such amount.

(d)          The
joint holders of a share shall be jointly and severally liable to pay all calls
in respect thereof and all interest payable thereon.

(e)          Any
amount unpaid in respect of a call shall bear interest from the date on which
it is payable until actual payment thereof, at such rate (not exceeding the
then prevailing debitory rate charged by leading commercial banks in Israel),
and at such time(s) as the Board of Directors may prescribe.

(f)          Upon
the allotment of shares, the Board of Directors may provide for differences
among the allottees of such shares as to the amount of calls and/or the times
of payment thereof.

15.         Prepayment

With
the approval of the Board of Directors, any shareholder may pay to the Company
any amount not yet payable in respect of such shareholders shares, and the
Board of Directors may approve the payment of interest on any such amount until
the same would be payable if it had not been paid in advance, at such rate and
time(s) as may be approved by the Board of Directors.  The Board of Directors may at any time cause the Company to repay
all or any part of the money so advanced, without premium or penalty.  Nothing in this Article 15 shall
derogate from the right of the Board of Directors to make any call before or
after receipt by the Company of any such advance.

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16.         Forfeiture
and Surrender

(a)          If
any shareholder fails to pay any amount payable in respect of a call, or
interest thereon as provided for herein, 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 the said call had 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 call.

(b)          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.

(c)          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.

(d)          The
Company, by resolution of the Board of Directors, may accept the voluntary
surrender of any share.

(e)          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.

(f)          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
calls, 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, at the rate prescribed in
Article 14(e) above, and the Board of Directors, in its discretion, may
enforce the payment of such monies, 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.

(g)          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 16.

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17.         Intentionally
Deleted.

18.         Sale after
Forfeiture or Surrender

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 Share 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 Share 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.

19.         Redeemable
Shares

The
Board of Directors may, subject to the provisions of the Companies Law, issue
redeemable shares and redeem the same.

TRANSFER OF SHARES

20.         Effectiveness
and Registration

The
shares of the Company are freely transferable. 
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.  Until the transferee has been registered in
the Share Register in respect of the shares so transferred, the Company may
continue to regard the transferor as the owner thereof.  The Board of Directors, may, from time to
time, prescribe a reasonable fee for the registration of a transfer.

21.         Suspension
of Registration

The
Board of Directors may suspend the registration of transfers during the
fourteen (14) days immediately preceding a general meeting of the shareholders
of the Company.

TRANSMISSION OF SHARES

22.         Decedents
Shares

(a)          In
case of a share registered in the names of two or more holders, the Company may
recognize the survivor(s) as the sole owner(s) thereof unless and until the
provisions of Article 22(b) have been effectively invoked.

(b)          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 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.

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23.         Receivers
and Liquidators

(a)          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.

(b)          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 or of
his title, shall with the consent of the Board of Directors (which the Board of
Directors may grant or refuse in its absolute discretion), be registered as a
shareholder in respect of such shares, or may, subject to the regulations as to
transfer herein contained, transfer such shares.

GENERAL MEETINGS

24.         Annual
General Meeting

(a)          An
Annual General Meeting shall be held once in every calendar year at such time
(within a period of not more than fifteen (15) months after the last preceding
Annual General Meeting) and at such place either within or without the State of
Israel as may be determined by the Board of Directors.

25.         Special
General Meetings

(a)          All
General Meetings other than Annual General Meetings shall be called Special
General Meetings.

(b)          The
Board of Directors may, whenever it thinks fit, convene a Special General
Meeting at such time and place as may be determined by the Board of Directors.

(c)          The
Board of Directors shall be obligated to convene a Special General Meeting at
such time and place, within or without the State of Israel, as may be
determined by the Board of Directors, upon requisition in writing as follows:

(i)          The
requisition in writing is made by any of the following:

(x)          two
directors or twenty-five percent (25%) of the directors holding office;

(y)          one
or more shareholders holding at least five percent (5%) of the Companys
outstanding shares, and at least one-percent (1%) of the voting rights in the
Company; and

(z)          one
or more shareholders holding at least five percent (5%) of the voting rights in
the Company.

(ii)         The
requisition in writing to convene a Special General Meeting pursuant to Article
25(c)(i) shall set forth the reasons for convening the meeting, shall be signed
by the person(s) requesting the convening of the meeting and shall be delivered
to the registered offices of the Company.

(iii)        Within
twenty-one (21) days of receipt of the requisition in writing, the Board of
Directors shall send a notice pursuant to Article 26 below to the shareholders
of the Company. The General Meeting shall convene within at least 35 days from
the date the written notice was issued.

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26.         Notice of
General Meetings; Omission to Give Notice

(a)          Not
less than twenty-one (21) days prior notice shall be given of every General Meeting.  Each such notice shall specify the place and
the day and hour of the meeting and the general nature of each item to be acted
upon thereat, as well as any other information required by the Companies Law or
any regulation promulgated thereunder.

(b)          The
accidental omission to give notice of a meeting to any shareholder, or the
non-receipt of notice sent to such shareholder, shall not invalidate the
proceedings at such meeting.

PROCEEDINGS AT GENERAL MEETINGS

27.         Entitlement
to Notice; Participation

(a)          Notice
shall be given to all shareholders registered in the Companys Share Register.

(b)          The
Board of Directors shall set a record date, which date shall comply with the
requirements of the Companies Law. 
Shareholders of record, as set forth in the Companys Share Register, on
the day determined by the Board of Directors and set forth in the notice of
General Meeting shall be entitled to participate and vote in the General
Meeting.

28.         Quorum

(a)          Two
or more shareholders (not in default in payment of any sum referred to in
Article 33(a) hereof), present in person, by proxy or by proxy card and
holding shares conferring in the aggregate thirty-three and a third percent (331/3%)
or more of the voting power of the Company, 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.

(b)          If
within half an hour from the time appointed for the meeting a quorum is not
present, the meeting, if convened upon requisition under Article 25(c), shall
be dissolved, but in any other case it shall stand adjourned to the same day in
the next week, at the same time and place, or to such day and at such time and
place as the Chairman may determine with the consent of the holders of a
majority of the voting power represented at the meeting in person or by proxy
and voting on the question of adjournment. 
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, any two (2)
shareholders (not in default as aforesaid) present in person, by proxy or by
proxy card, shall constitute a quorum.

29.         Chairman

The
Chairman, if any, of the Board of Directors shall preside as Chairman at every
General Meeting of the Company.  If there
is no such Chairman, or 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, the shareholders present shall choose someone of
their number to be Chairman.  The office
of Chairman shall not, by itself, entitle the holder thereof to vote at any
General Meeting nor shall it entitle such holder to a second or casting vote
(without derogating, however, from the rights of such Chairman to vote as a
shareholder or proxy of a shareholder if, in fact, he or she is also a
shareholder or such proxy).

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30.         Adoption of
Resolutions at General Meetings

(a)          Except
with respect to matters which require the approval of a special majority under
the Companies Law, all resolutions of the shareholders shall be deemed adopted
if approved by the holders of a simple majority of the voting power represented
at the meeting, in person, by proxy or by proxy card, and voting thereon.

(b)          Every
question submitted to a General Meeting shall be decided by a show of hands,
but if a written ballot is demanded by any shareholder present in person or by
proxy and entitled to vote at the meeting, the same shall be decided by such
ballot.  A written ballot may be
demanded before the proposed resolution is voted upon or immediately after the
declaration by the Chairman of the results of the vote by a show of hands.  If a vote by written ballot is taken after
such declaration, the results of the vote by a show of hands shall be of no
effect, and the proposed resolution shall be decided by such written
ballot.  The demand for a written ballot
may be withdrawn at any time before the same is conducted, in which event
another shareholder may then demand such written ballot.  The demand for a written ballot shall not
prevent the continuance of the meeting for the transaction of business other
than the question on which the written ballot has been demanded.  All votes properly tendered by proxy card,
as set forth in Article 33(c)(iii), with respect to a given resolution shall be
counted for purposes of determining the outcome of any vote with respect to
such resolution taken by show of hands or by secret ballot.

(c)          A
declaration by the Chairman of the meeting that a resolution has been carried
unanimously, or carried by a particular majority, or lost, and an entry to that
effect in the minute book of the Company, shall be prima facie evidence of the
fact without proof of the number or proportion of the votes recorded in favor
of or against such resolution.

31.         Power to
Adjourn

(a)          The
Chairman of a General Meeting at which a quorum is present may, with the
consent of the holders of a majority of the voting power represented in person
or by proxy and voting on the question of adjournment (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.

(b)         It
shall not be necessary to give any notice of an adjournment, unless the meeting
is adjourned for thirty (30) days or more in which event notice thereof shall
be given in the manner required for the meeting as originally called.

32.         Voting
Power

Subject
to the provisions of Article 33(a) and subject to the rights of holders of
shares with special rights as to voting, 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 written
ballot or by any other means.

33.         Voting
Rights

(a)          No
shareholder shall be entitled to vote at any General Meeting (or be counted as
a part of the quorum thereat), unless all calls and other sums then payable by
such shareholder in respect of such shareholders shares in the Company have
been paid.

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(b)          A
company or other corporate body being a shareholder of the Company may, subject
to applicable law, authorize any person to be its representative at any meeting
of the Company.  Any person so
authorized shall be entitled to exercise on behalf of such shareholder all the
power that the latter could have exercised if it were an individual
shareholder.  Upon the request of the
Chairman of the meeting, written evidence of such authorization (in form
acceptable to the Chairman) shall be delivered to the Chairman.

(c)          Any
shareholder entitled to vote may vote in one of the following manners:

(i)         personally;

(ii)        by
proxy (who need not be a shareholder of the Company);

(iii)
      by proxy card,
provided it is completed and returned to the Companys offices in accordance
with its terms; or

(iv)
       if the shareholder
is a company or other corporate body, by a representative authorized pursuant
to Article 33(b).

(d)          If
two or more persons are registered as joint holders of any share, the vote of
the senior who tenders a vote, in person, by proxy or by proxy card, 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 Share Register.

34.         Proxies;
Instrument of Appointment

(a)          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 Pointer Telocation Ltd. hereby appoint ________________________ (Name
of Proxy) of _____________________________ (Address of Proxy) as my proxy to
vote for me and on my behalf 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 a form which provides for a continuing
proxy until the occurrence of such date or event as is specified in the
proxy.  It shall be duly signed by the
appointer or his duly authorized attorney, which signature shall be confirmed by an advocate or notary or bank
or in any other manner acceptable to the Chairman 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).

(b)          The
instrument appointing a proxy (and the power of attorney or other authority, if
any, under which such instrument has been signed) shall either be delivered to
the Company (at its Registered Office, or at its principal place of business or
at the offices of its registrar and/or transfer agent or at such place 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, or presented to the
Chairman at such meeting.

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(c)          Proxy
cards shall be in such form, and substance, as shall be prescribed by the Board
of Directors.  Proxy cards shall be
completed and delivered to the Company (at its Registered Office, or at its
principal place of business or at the offices of its registrar and/or transfer
agent or at such place as the Board of Directors may specify) in accordance
with its terms.

(d)          A
vote cast pursuant to an instrument appointing a proxy or by proxy card 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 revocation or transfer shall have been received
by the Company or by the Chairman of the 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, or otherwise.

BOARD OF DIRECTORS

35.         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 Section 92 of the Companies Law. 
The Board of Directors shall be empowered to exercise any power of the
Company not conferred upon by the Companies Law or by these Articles on any
other organ of the Company.  The
authority conferred on the Board of Directors by this Article 35 shall be
subject to the provisions of the Companies Law and of these Articles.

36.         Exercise
of Powers of Directors

(a)          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.

(b)          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.

(c)          The
Board of Directors is authorized to adopt any resolution without an actual
meeting, provided that all Directors then in office and lawfully entitled to
vote thereon (as conclusively determined by the Chairman of the Board of
Directors) have agreed in writing or given their consent (by telephone, e-mail,
facsimile, letter or otherwise) to the adoption of such resolution.  In the event of the adoption of a resolution
pursuant to this Article 36(c), the Chairman of the Board shall state in the
minutes the manner in which each Director voted on the resolution and the fact
that all directors consented to the adoption of the resolution without the
convening of a meeting.

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37.         Audit
Committee

(a)          The
Board of Directors shall appoint an Audit Committee (all of whose members must
be Directors) comprised of at least three Directors, including all of the
Outside Directors.  The Chairman of the
Board of Directors, any other Director who is employed by, or providing
services on a regular basis to, the Company and any Controlling Shareholder or
a Relative of a Controlling Shareholder shall not serve as members of the Audit
Committee.

(b)          The
duties of the Audit Committee shall be:

| | (i)          to
detect any deficiencies in the business management of the Company, by among
other things consulting with the Companys Internal Auditor and independent
auditors, and to propose to the Board of Directors ways of correcting these
deficiencies; and
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | (ii)         to
decide whether to approve actions and transactions requiring approval of the
Audit Committee pursuant to the Companies Law.                                                                                                                          

38.         Delegation
of Powers

(a)          Subject
to Section 112 of the Companies Law, the Board of Directors may delegate any or
all of its powers to committees, each consisting of two or more persons (all of
whose members must be Directors, at least one of which must be an Outside
Director), 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.  Unless otherwise expressly provided by the Board of Directors in
delegating powers to a Committee of the Board of Directors, such Committee
shall not be empowered to further delegate such powers.

(b)          Without
derogating from the provisions of Article 52, the Board of Directors may,
subject to the provisions of the Companies Law, from time to time appoint a
Secretary to the Company, as well as officers, agents, employees and
independent contractors, as the Board of Directors may think appropriate, and
may terminate the service of any such person. 
The Board of Directors may, subject to the provisions of the Companies
Law, determine the powers and duties, as well as the terms and conditions of
employment, of all such persons, and may require security in such cases and in
such amounts as it thinks appropriate.

(c)          The
Board of Directors may from time to time, by power of attorney or otherwise,
appoint any person, company, firm or body of persons to be the attorney or
attorneys of the Company at law or in fact for such purpose(s) and with such
powers, authorities and discretions, and for such period and subject to such
conditions, as it thinks fit, and any such power of attorney or other
appointment may contain such provisions for the protection and convenience of
persons dealing with any such attorney as the Board of Directors may think fit,
and may also authorize any such attorney to delegate all or any of the powers,
authorities and discretions vested in him.

(d)          Any
director designated to the Board of Directors as a nominee of either DBSI Holdings Ltd.
or Egged Holdings Ltd. may demand that a resolution of the Board of Directors of the
Company be transferred to the vote of the shareholders of the Company.

39.         Number of
Directors

The
number of members of the Board of Directors (including Outside Directors) shall
be determined, from time to time, by the Annual General Meeting, provided that
the Board of Directors of the Company shall consist of not less than three (3)
directors and not more than eleven (11) Directors.

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40.         Election,
Appointment and Removal of Directors

(a)          The
Directors shall be elected and dismissed by the holders of a majority of the
shares present and voting at an Annual General Meeting, provided that any vote
to appoint or dismiss an Outside Director shall satisfy the requirements of
Section 239 or Section 246, as the case may be, of the Companies Law.  Subject to Article 39 above, between annual
meetings, the Board shall be empowered to appoint directors, other than Outside
Directors, by a majority vote of the directors.

(b)          All
Directors, except Outside Directors, shall retire at the Annual General Meeting
of the Company immediately following the Annual General Meeting at which they
were elected, subject to the provisions of sub-article 40(d) below.  Outside Directors shall retire on the third
Annual General Meeting of the Company after the Annual General Meeting in which
they were appointed.

(c)          A
retiring Director shall be eligible for re-election, provided that Outside
Directors shall only be entitled to re-election for one additional term of
three years.

(d)          If
at any Annual General Meeting, the places of the vacating directors are not
filled, the meeting shall stand adjourned until the same day in the next week
at the same time and place, and if at the adjourned meeting the places of the
vacating Directors are, again, not filled, the vacating Directors shall be deemed
to have been re-elected at the adjourned meeting.  In any event, a retiring director shall remain in office until a
new director has been elected or appointed in his or her place.

(e)          Every
Director who serves as such upon the effective date of these Articles shall
continue to serve in his or her position until the conclusion of the election
of Directors in the first General Meeting that will take place after the
effective date of these Articles, unless the position is vacated before then in
accordance with these Articles.

(f)          Notwithstanding
anything to the contrary in this Article 40, the shareholders may, at any time,
by resolution at a Special General Meeting, discharge from office any member of
the Board of Directors (provided that with respect to Outside Directors, the
dismissal is effected in accordance with Section 246 of the Companies Law)
and/or to appoint a member to the Board of Directors (provided that with
respect to Outside Directors, the requirements of Section 239 of the Companies
Law are satisfied); provided however, that in the event of dismissal of a
Director, the Director shall first be given the opportunity to state his or her
case.

41.         Qualification
of Directors

No
person shall be disqualified to serve as a Director by reason of his or her not
holding shares in the Company or by reason of his having served as a Director
in the past, subject to Sections 240 and 245 of the Companies Law with respect
to Outside Directors.

42.         Continuing
Directors in the Event of Vacancies

In
the event of one or more vacancies in the Board of Directors, the continuing
Directors may continue to act in every matter, and, pending the filling of any
vacancy pursuant to the provisions of Article 40, may temporarily fill any
such vacancy; provided, however, that if they number less than a majority of
the number provided for pursuant to Article 39 hereof or if the number of
Outside Directors drops below two, they may only act in an emergency, and must
call a General Meeting of the Company for the purpose of electing Directors to
fill any or all vacancies, so that at least a majority of the number of
Directors provided for pursuant to Article 39 hereof, or at least two Outside
Directors, as the case may be, are in office as a result of said meeting.

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43.         Vacation of
Office

(a)          The
office of a Director shall be vacated by the Directors written
resignation.  Such resignation shall
become effective on the date fixed therein, or upon the delivery thereof to the
Company, whichever is later.

(b)          The Company will be entitled, at any time, by
resolution of the shareholders at a Special General Meeting, to discharge from
office any Director, provided such Director is given a reasonable opportunity
to state his or her case before the shareholders at the General Meeting.  The power granted by this sub-article shall
not apply to Outside Directors, unless such discharge is effected in accordance
with Section 246 of the Companies Law.

(c)          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 of the Companies
Law, (iv) such Director becomes legally incompetent, or (v) such Director is
declared bankrupt, or (vi) if such Director is a corporate entity, upon its
winding-up liquidation, whether voluntary or involuntary.

44.         Remuneration
of Directors

No
Director shall be paid any remuneration by the Company for such Directors
services as a member of the Board of Directors or for any other services
provided to the Company, unless such remuneration has been approved pursuant to
the provisions of the Companies Law.

45.         Conflict of
Interests

Subject
to the provisions of the Companies Law, the Company may enter into any contract
or otherwise transact any business with any Office Holder in which contract or
business such Office Holder has a personal interest, directly or indirectly;
and may enter into any contract of otherwise transact any business with any third
party in which contract or business an Office Holder has a personal interest,
directly or indirectly.

46.         Alternate
Directors

(a)          A
Director may, by written notice to the Company, appoint an alternate for
himself or herself (in these Articles referred to as Alternate Director),
remove such Alternate Director and appoint another Alternate Director in place
of any Alternate Director appointed by him whose office has been vacated for
any reason whatsoever.  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, the appointment shall be for an indefinite
period, and for all purposes.

(b)          Any
notice given to the Company pursuant to Article 46(a) shall become
effective on the date fixed therein, or upon the delivery thereof to the Company,
whichever is later.

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(c)          An
Alternate Director shall have all the rights and obligations of the Director
who appointed him, provided, however, that he or she may not in turn appoint an
alternate for himself or herself (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 thereof while the Director who appointed him is present.

(d)          Any
person or legal entity that is qualified to serve as a Director may act as an
Alternate Director, provided that one person may not act as an Alternate Director
for more than one Director and a Director may not act as an Alternate Director
for another Director.

(e)          An
Alternate Director shall be responsible for his own acts and defaults.

(f)          The
office of an Alternate Director shall be vacated under the circumstances,
mutatis mutandis, set forth in Article 43, 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

(a)          The
Board of Directors shall convene meetings as required to fulfill the needs of
the Company, but in any event shall convene at least one meeting in every three
month period.  The Board of Directors
may meet and adjourn its meetings and otherwise regulate such meetings and
proceedings as the Directors think fit. 
Meetings of the Board of Directors may be held telephonically or by any
other means of communication provided that each Director participating in such
meeting can hear all of the other Directors participating in such meeting.

(b)          The
Chairman of the Board of Directors may convene a meeting of the Board of
Directors from time to time as he or she deems fit, provided that a prior
written notice of such a meeting shall be given reasonable time in advance
unless such notice is waived in writing by all of the Directors as to a
particular meeting. The notice of meeting shall include the agenda of the
meeting.

(c)          Upon
the receipt of a written request under any of the following circumstances, the
Chairman of the Board of Directors shall, and in the absence of a Chairman, any
Director receiving such written request shall convene a meeting of the Board of
Directors, provided that a prior written notice of such a meeting shall be
given reasonable time in advance, unless such notice is waived in writing by
all of the Directors as to a particular meeting:

(i)         upon
the receipt of a written request from any two Directors, or in the event that
there are five or less Directors serving in office at the time, upon the
written request of any Director;

(ii)        upon
the receipt of a written request from any Director requesting that a meeting be
convened and stating that he or she has learned of an alleged violation of the
law or  proper business procedure by the
Company.

(iii)       upon
the receipt of any written request from the Chief Executive Officer of the
Company requesting an action of the Board of Directors; or

(iv)       upon
the receipt of a written request from the independent auditor(s) of the Company
regarding material flaws in the oversight of the Companys internal accounting
methods.

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48.         Quorum

(a)          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
represented by an Alternate Director, of a majority of the Directors then in
office who are lawfully entitled to participate in the meeting (as conclusively
determined by the Chairman of the Board of Directors).

(b)          If
within an 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) days 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, any two (2) members present in person or represented by
an Alternate Director shall constitute a quorum.

(c)          Notwithstanding
anything to the contrary in this Article 48, the quorum for purposes of
discussing and resolving upon the termination or suspension of the services of
the Internal Auditor of the Company shall be a majority of the Directors then
in office.

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 of the Board of Directors, remove such Chairman from office and
appoint another in its place.  The
Chairman of the Board of Directors shall preside at every meeting of the Board
of Directors, but if there is no such Chairman, or if at any meeting he or she
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.  The Chief Executive Officer of
the Company shall not serve as the Chairman of the Board of Directors, and the
Chairman of the Board of Directors shall not be granted authorities of the
Chief Executive Officer, unless such appointment, or grant, as the case may be,
is approved by the shareholders in a General Meeting in accordance with Section
121(c) of the Companies Law.  The office
of Chairman shall not entitle such Director to a second or casting vote.

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, or by
any person(s) acting as Director(s), shall, 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, be as valid as if
there were no such defect or disqualification.

MINUTES

51.         Minutes

(a)          Minutes
of each General Meeting and of each meeting of the Board of Directors (or any
committee thereof) shall be recorded and duly entered in books provided for
that purpose.

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(b)          Any
minutes as aforesaid, if purporting to be signed by the chairman of the meeting
or by the chairman of the next succeeding meeting, shall constitute prima facie
evidence of the matters recorded therein.

CHIEF EXECUTIVE OFFICER

52.         Chief
Executive Officer

(a)          The
Board of Directors shall from time to time appoint one or more persons, whether
or not Directors, 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.  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.

(b)          The
Chief Executive Officer(s) shall manage the business of the Company, subject to
the policies established by the Board of Directors, such limitations and
restrictions as are set forth in these Articles or as the Board of Directors
may from time to time prescribe, and the provisions of the Companies Law.

(c)
         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 provisions of the Companies Law.

(d)          Subject
to the provisions of the Companies Law and provided the Board of Directors has
authorized him or her to do so, the Chief Executive Officer of the Company may
appoint additional Officer Holders (as such term is defined in the Companies
Law) of the Company (other than Directors and Chief Executive Officers), and
determine the duties and powers of such Office Holders, and the terms and
conditions of such Office Holders employment. 
The Chief Executive Officer shall notify the Board of Directors of each
such appointment at the first meeting of the Board of Directors following such
appointment.

INTERNAL AUDITOR

53.         Internal Auditor

The
Board of Directors shall appoint an internal auditor pursuant to a
recommendation of the Audit Committee. 
The following persons shall not serve as the Internal Auditor of the
Company: (i) any Interested Party of the Company; (ii) any Office Holder of the
Company; (iii) any relative of either of the foregoing; and (iv) the Companys
independent auditor(s) or anyone on their behalf.

INDEMNIFICATION AND INSURANCE

54.         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 Board of Directors may
resolve in advance to exempt an Office Holder from all or part of such Officer
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.

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55.         Indemnification

(a)         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.

(b)         Subject
to the provisions of the Companies Law including the receipt of all approvals as
required therein or under any applicable law, the Board of Directors 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 Officer Holder in such Officer Holders capacity as an
Officer 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;
and

(ii)         reasonable
legal expenses, including attorneys fees, which the Office Holder incurred or
with which the Officer Holder was charged by a court of law, in a proceeding
brought against the Officer Holder, by the Company or by another on behalf of
the Company, or in a criminal prosecution in which the Officer 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.

(c)         Subject
to the provisions of the Companies Law including the receipt of all approvals
as required therein or under any applicable law, the Board of Directors may
resolve in advance to indemnify the Companys Officer Holders for those
liabilities and expenses described in Sub-Article 55(b)(ii), 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.

56.         Insurance

(a)          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 Officer Holder
in such Office Holders capacity as an Officer 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 fiduciary duty towards the Company, provided that the Office Holder
acted in good faith and with reasonable grounds to assume that the action in
question would not harm the best interests of the Company; and

(iii)         a
financial obligation imposed on the Office Holder for the benefit of another
person.

(b)          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 the Companies Law.

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57.         Inapplicability
of Articles 54, 55, and 56(a)

(a)           Articles
54, 55 and 56(a) shall not apply under any of the following circumstances:

(i)           a
breach of an Office Holders fiduciary duty, if the Officer 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.

RIGHTS OF SIGNATURE AND RUBBER STAMP

58.         Rights of
Signature and Rubber Stamp

(a)          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 acts
and signature of such person(s) on behalf of the Company, together with the
Companys rubber stamp or 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.

(b)          The
Company shall have at least one official rubber stamp.

DIVIDENDS

59.         Declaration
of Dividends

Subject
to the Companies Law, the Board of Directors may from time to time declare, and
cause the Company to pay, 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 payment of such dividends and the record
date for determining the shareholders entitled thereto.

60.         Amount
Payable by Way of Dividends

Subject
to the rights of the holders of shares with special rights as to dividends, any
dividend paid by the Company shall be allocated among the shareholders entitled
thereto in proportion to the nominal value of their respective holdings of the
shares in respect of which such dividend is being paid.

61.         Payment in
Specie

Subject
to the Companies Law, the Board of Directors may from time to time declare a
dividend to be paid, wholly or partly, by the distribution of specific assets
of the Company or by distribution of paid up shares, debentures or debenture
stock of the Company or of any other companies, or in any one or more of such
ways.

62.         Implementation
of Powers under Articles 60 and 61

For
the purpose of giving full effect to any resolution under Articles 60 or
61, the Board of Directors may settle any difficulty which may arise in regard
to the distribution as it thinks expedient, including determine the value for
the purpose of the said distribution of certain assets and resolve that
payments in cash shall be made to members in reliance upon the value thus
determined, determine regulations in relation to fractions of shares or in relation
to non-payment of amounts less than NIS 200.

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63.         Deductions
from Dividends

The
Board of Directors may deduct from any dividend or other monies 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 calls or otherwise in respect of
shares of the Company and/or on account of any other matter of transaction
whatsoever.

64.         Retention
of Dividends

(a)          The
Board of Directors may retain any dividend or other monies payable or property
distributable in respect of a share on which the Company has a lien, and may
apply the same in or toward satisfaction of the debts, liabilities, or
engagements in respect of which the lien exists.

(b)          The
Board of Directors may retain any dividend or other monies payable or property
distributable in respect of a share in respect of which any person is, under
Articles 22 or 23, entitled to become a shareholder, or which any person
is, under said Articles, entitled to transfer, until such person shall become a
shareholder in respect of such share or shall transfer the same.

65.         Unclaimed
Dividends

All
unclaimed dividends or other monies payable in respect of a share may be
invested or otherwise made use of by the Board of Directors for the benefit of
the Company until claimed.  The payment
by the Directors of any unclaimed dividend or such other monies into a separate
account shall not constitute the Company a trustee in respect thereof, and any
dividend unclaimed after a period of three (3) years from the date of
declaration of such dividend, and any such other monies unclaimed after a like
period from the date the same were payable, shall be forfeited and shall revert
to the Company; provided, however, that the Board of Directors may, at its
discretion, cause the Company to pay any such dividend or such other monies, or
any part thereof, to a person who would have been entitled thereto had the same
not reverted to the Company.

66.         Mechanics
of Payment

Any
dividend or other monies 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
person entitled thereto 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 person to whom it is sent, 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.

67.         Receipt
from a Joint Holder

If
two or more persons are registered as joint holders of any share, or are
entitled jointly thereto in consequence of the death or bankruptcy of the
holder or otherwise, any one of them may give effectual receipts for any
dividend or other monies payable or property distributable in respect of such
share.

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ACCOUNTS

68.         Books of
Account

The
Board of Directors shall cause accurate books of account to be kept in
accordance with the provisions of the Companies Law and of any other applicable
law.  Such books of account shall be
kept at the Registered Office of the Company, or at such other place or places
as the Board of Directors may think appropriate, and they shall always be open
to inspection by all Directors.  No
shareholder, not being a Director, shall have any right to inspect any account
or book or other similar document of the Company, except as conferred by law or
authorized by the Board of Directors or by a resolution of a General Meeting of
the Company.

69.         Fiscal Year

The
Companys fiscal year shall commence on January 1st and end on the
following December 31st.

70.         Audit

The Company shall prepare financial
statements in accordance with generally accepted accounting principles
consistently applied and as required by the Companies Law and any other
applicable law.  The Companys annual
financial statements shall be audited for correctness by the Companys auditor
and shall be approved and signed by the Board of Directors.

71.         Auditors

(a)          The
shareholders of the Company shall appoint an independent auditor(s) of the
Company at the Annual General Meeting. 
Such appointment shall be in force until the end of the fiscal year for
which the appointment is made, or for a longer period if so resolved at the
Annual General Meeting, but in no event for a period of more than three fiscal
years. The shareholders of the Company may remove the independent auditor(s) at
any time.

(b)          The
appointment, authorities, rights and duties of the independent auditor(s) of
the Company shall be regulated by applicable law.

(c)          The
Board of Directors shall determine the remuneration of the independent
auditor(s) and report to the shareholders on such remuneration at the Annual
General Meeting.

DONATIONS

72.         Donations

The
Company shall be entitled to donate reasonable amounts to a cause which the
Board of Directors deems worthy, even if such donation is not motivated by
business considerations.

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NOTICES

73.         Notices

(a)          Any
written notice or other document may be served by the Company upon any
shareholder personally or by sending it by mail addressed to such shareholder
at such shareholders address as described in the Share Register or such other
address as such shareholder may have designated in writing for the receipt of
notices and other documents.  Any
written notice or other document may be served by any shareholder upon the
Company by tendering the same in person to the Secretary or the Chief Executive
Officer of the Company at the principal office of the Company or by sending it
by prepaid registered mail (airmail if posted outside Israel) to the Company at
its Registered Address.  Any such notice
or other document shall be deemed to have been served two (2) business days
after it has been posted (five (5) business days if sent to a place not located
on the same continent as the place from where it was posted), or when actually
received by the addressee if sooner than two (2) days or five (5) days, as the
case may be, after it has been posted, or when actually tendered in person, to
such shareholder (or to the Secretary or the Chief Executive Officer);
provided, however, that notice may be sent by e-mail, facsimile or other
electronic means and confirmed by registered mail as aforesaid, and such notice
shall be deemed to have been given twenty-four (24) hours after such e-mail,
facsimile or other electronic communication has been sent or when actually
received by such shareholder (or by the Company), whichever is earlier.  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 73(a).

(b)          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 Share Register, and any notice so given shall be sufficient
notice to the holders of such share.

(c)          Any
shareholder whose address is not described in the Share 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.

WINDING UP

74.         Winding Up

Subject
to the rights of the holders of shares with special rights as to liquidation,
if the Company be wound up on liquidation or dissolution, then, subject to
applicable law, all the assets of the Company available for distribution among
the shareholders shall be distributed to them in proportion to the respective
percentage holdings of all of the Ordinary Shares (assuming for purposes of
this calculation, the conversion of any other class of shares into Ordinary
Shares).

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