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Exhibit 1.2

# Articles of Association

# of

# ALVARION LTD.

# GENERAL

|1. | Definition
and Interpretation
|-- | -----------------------------

|1.1. | The
following terms in these Articles of Association shall have the respective
                    meanings ascribed to them below:
|---- | -----------------------------------------------------------------------------------------------------------------------------------

| | Articles | The
Articles of Association of the Company, as set forth herein or as amended.
| | -------- | ------------------------------------------------------------------------------

| | Board | The
Board of Directors of the Company.
| | ----- | --------------------------------------

| | Business Day | Sunday
to Thursday, inclusive, with the exception of holidays and officials days of rest in the
State of Israel.
| | ------------ | ----------------------------------------------------------------------------------------------------------------

| | Companies Law | The
Companies Law, 1999, as may be amended from time to time.
| | ------------- | -------------------------------------------------------------

| | Companies Regulations | Regulations issued pursuant to the Companies Law.
| | --------------------- | -------------------------------------------------

| | Director | A
Director of the Company in accordance with the definition of the Companies Law.
| | -------- | ---------------------------------------------------------------------------------

| | General Meeting | A
general meeting of the Shareholders of the Company.
| | --------------- | -----------------------------------------------------

| | Law | The
provisions of any law (din) as defined in the Interpretation Law, 1981.
| | --- | -----------------------------------------------------------------------------

| | Ordinary Majority | More
than fifty percent (50%) of the votes of the Shareholders who are entitled to vote and
who voted in a General Meeting in person, by means of a proxy or by means of a deed of
vote.
| | ----------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

1

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| | Securities | Shares,
bonds, capital notes or securities convertible, exchangeable or exercisable into shares,
and certificates conferring a right in such securities, issued by the Company.
| | ---------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Securities Law | The Securities Law, 1968.
| | -------------- | -------------------------

| | Securities Regulations | Regulations issued pursuant to the Securities Law.
| | ---------------------- | --------------------------------------------------

| | Shareholder | Anyone
registered as a shareholder in the Shareholder Register of the Company.
| | ----------- | ------------------------------------------------------------------------------

| | Significant Shareholder | A
Shareholder who holds five percent (5%) or more of the Companys issued share
capital or of the voting rights in the Company.
| | ----------------------- | -------------------------------------------------------------------------------------------------------------------------------

| | Special Majority | A
majority of at least three quarters of the votes of the Shareholders who are entitled to
vote and who voted in a General Meeting, in person, by means of a proxy or by means of a
deed of vote.
| | ---------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|1.2. | Unless
the subject or the context otherwise requires, each word and expression
                    not specifically defined herein and defined in the Companies Law as
in effect on                     the date when these Articles first became effective
shall have the same meaning                     herein, and to the extent that no meaning
is attached to it in the Companies                     Law, the meaning ascribed to it in
the Companies Regulations, and if no meaning                     is ascribed thereto in
the Companies Regulations, the meaning ascribed to it in                     the
Securities Law or Securities Regulations; words and expressions importing
                    the singular shall include the plural and vice versa; words and
expressions                     importing the masculine gender shall include the feminine
gender; and words and                     expressions importing persons shall include
corporate entities.
|---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|1.3. | 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.
|---- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------

|2. | Public
Company
|-- | --------------

| | The
Company is a public company.
| | --------------------------------

|3. | The
Purpose of the Company
|-- | --------------------------

| | The
purpose of the Company is to operate in accordance with business considerations to
generate profits; provided, however, that the Company may donate reasonable amounts to
worthy causes, as the Board may determine in its discretion, even if such donations are
not within the framework of business considerations.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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|4. | The
Objectives of the Company
|-- | -----------------------------

| | The
Company shall engage in any lawful business.
| | ------------------------------------------------

|5. | Limited
Liability
|-- | -----------------

| | The
liability of the Shareholders of the Company is limited, each one up to full amount he
undertook to pay for the shares of the Company allotted to him.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------

# SHARE CAPITAL

|6. | Share
Capital
|-- | -------------

|6.1. | The
registered share capital of the Company is One Million Two Hundred Thousand
               Eight Hundred New Israeli Shekels (NIS 1,200,800) divided into One Hundred
and                Twenty Million Eighty Thousand (120,080,000) Ordinary Shares of a
nominal value                of One Agora (NIS 0.01) each.
|---- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|6.2. | The
provisions of these Articles with respect to shares, shall also apply to
               other Securities issued by the Company, mutatis mutandis.
|---- | -----------------------------------------------------------------------------------------------------------------------------------------------------

|7. | Increase
of Share Capital
|-- | -------------------------

|7.1. | The
Company may, from time to time, by a resolution of the General Meeting
               adopted by an Ordinary Majority, whether or not all the shares then
authorized                have been issued, and whether or not all the shares theretofore
issued have been                called up for payment, 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 such resolution of the General                Meeting shall provide.
|---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|7.2. | Except
to the extent otherwise provided in such resolution of the General
               Meeting, such new shares shall be subject to all the provisions applicable
to                the shares of the original capital.
|---- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|8. | Special
Rights; Modifications of Rights
|-- | ---------------------------------------

|8.1. | Without
prejudice to any special rights previously conferred upon the holders of
               existing shares in the Company, the Company may, from time to time, by a
               resolution of the General Meeting adopted by an Ordinary Majority, provide
for                shares with such preferred or deferred rights or rights of redemption
or other                special rights and/or such restrictions, whether with respect to
liquidation,                dividends, voting, conversion, repayment of share capital or
otherwise, as may                be stipulated in such resolution.
|---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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|8.2. | 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, by a resolution of
the General                Meeting adopted by an Ordinary Majority, subject to the
consent in writing of                the holders of more than fifty percent (50%) of the
issued shares of such class                or the sanction of a resolution of a separate
General Meeting of the holders of                the shares of such class adopted by an
Ordinary Majority.
|---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|8.3. | Unless
otherwise provided by these Articles, the increase of the registered
               number of shares of an existing class of shares, or the issuance of
additional                shares thereof, shall not be deemed, for purposes of this
Article 8, 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
|-- | -----------------------------------------------------------------------

|9.1. | The
Company may, from time to time, by a resolution of the General Meeting
               adopted by an Ordinary Majority (subject, however, to the provisions of
               Article 8.2 hereof and to the Companies Law):
|---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (a) | Consolidate
and divide all or any of its issued or unissued share capital into                shares
of larger nominal value than its existing shares;
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------

| | (b) | Subdivide
its shares (issued or unissued) or any of them, into shares of smaller
               nominal value than is fixed by these Articles (subject 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.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (c) | Cancel
any shares which, at the date of the adoption of such resolution of the
               General Meeting, have not been alloted, so long as the Company is not
under an                obligation to allot these shares, and diminish the amount of its
share capital                by the amount of the shares so cancelled; or
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (d) | Reduce
its share capital in any manner, and with and subject to any incident
               authorized, and consent required, by Law.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------

|9.2. | 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 may settle any difficulty which may arise with regard
thereto,                as it deems appropriate, including , inter  alia,
resort to one or                more of the following actions:
|---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (a) | Determine,
as to the holder of shares so consolidated, which issued shares shall                be
consolidated into each share of larger nominal value;
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------

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| | (b) | 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;
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (c) | Redeem,
in the case of redeemable shares, and subject to applicable Law, such
               shares or fractional shares sufficient to preclude or remove fractional
share                holdings;
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (d) | Cause
the transfer of fractional shares by certain Shareholders 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 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 9.2 (d).
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

# SHARES

|10. | Issuance
of Share Certificates; Replacement of Lost Certificates
|--- | ----------------------------------------------------------------

|10.1. | The
Company shall maintain a Shareholder Register and a Register of Significant
                    Shareholders, to be administered by the corporate secretary of the
Company,                     subject to the oversight of the Board.
|----- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|10.2. | Share
certificates shall be issued under the seal or stamp of the Company and
                    shall bear the signatures of one Director and the corporate
secretary, or of two                     Directors, or of any other person or persons
authorized thereto by the Board.
|----- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|10.3. | Each
Shareholder shall be entitled to one numbered certificate for all the
                    shares of any class registered in his name, and if the Board so
approves, to                     several certificates, each for one or more of such
shares. Each certificate may                     specify the serial numbers of the shares
represented thereby and may also                     specify the amount paid up thereon.
|----- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|10.4. | A
share certificate registered in the names of two or more persons shall be
                    delivered to the person first named in the Shareholder Register in
respect of                     such co-ownership.
|----- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|10.5. | 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 may deem appropriate.
|----- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|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, shall be entitled to
treat the holder of any share in trust as a Shareholder and to issue to him a share
certificate, in condition that the trustee notify the Company of the identity of the
beneficiary, and, accordingly, shall not, except as ordered by a court of competent
jurisdiction, or as required by Law, 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. | Issuance
of Shares and other Securities
|--- | ---------------------------------------

|12.1. | The
unissued shares from time to time shall be under the control of the Board,
                    who shall have the power to allot shares or otherwise dispose of them
to such                     persons, on such terms and conditions (including inter alia terms
                    relating to calls as set forth in Article 14 hereof), and either
at par or                     at a premium, or, subject to the provisions of the
Companies Law, at a discount,                     and at such times, as the Board may
deem appropriate, and the power to give to                     any person the option to
acquire from the Company any shares, either at par or                     at a premium,
or, subject as aforesaid, at a discount, during such time and for
                    such consideration as the Board may deem appropriate.
|----- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|12.2. | The
Board may determine to issue a series of bonds or other debt securities, as
                    part of its authority or to take a loan on behalf of the Company, and
within the                     limits of such authority.
|----- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|12.3. | The
Shareholders of the Company at any given time shall not have any preemptive
                    right or priority or any other right whatsoever with respect to the
acquisition                     of Securities of the Company. The Board, in its sole
discretion, may decide to                     offer Securities of the Company first to
existing Shareholders or to any one or                     more of them.
|----- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|12.4. | The
Company is entitled to pay a commission (including underwriting fees) to any
                    person, in consideration for underwriting services, or the marketing
or                     distribution of Securities of the Company, whether reserved or
unreserved, as                     determined by the Board. Payments, as stated in this
Article 12.4, may be paid                     in cash or in Securities of the Company, or
in a combination thereof.
|----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|13. | Payment
in Installments
|--- | -----------------------

| | If
by the terms of issuance 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 or the person(s) entitled thereto.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|14. | Calls
on Shares
|--- | ---------------

|14.1. | The
Board may, from time to time, make such calls as it may deem 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, 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
                    (and in the notice referred to in Article 14.2), 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.
|----- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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|14.2. | Notice
of any call shall be given in writing to the applicable Shareholder(s)
                    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 and the place                     where such payment shall be made; provided,
however, that before the time for                     any such payment, the Board may, by
notice in writing to such Shareholder(s),                     revoke such call in whole
or in part, extend such time, or alter such designated                     person and/or
place. In the event of a call payable in installments, only one
                    notice thereof need be given.
|----- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|14.3. | 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 and of which due
notice had been given,                     and all the provisions herein contained with
respect to calls shall apply to                     each such amount.
|----- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|14.4. | The
joint holders of a share shall be jointly and severally liable to pay all
                    calls in respect thereof and all interest payable thereon.
|----- | ------------------------------------------------------------------------------------------------------------------------------------------------------------

|14.5. | 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 may
prescribe.
|----- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|14.6. | Upon
the allotment of shares, the Board 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, any Shareholder may pay to the Company any amount not yet
payable in respect of his shares, and the Board 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. The Board 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 to
make any call before or after receipt by the Company of any such advance.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|16. | Forfeiture
and Surrender
|--- | ------------------------

|16.1. | If
any Shareholder fails to pay any amount payable in respect of a call,
                    or interest thereon as provided herein, on or before the day fixed
for payment                     of the same, the Company, by resolution of the Board, may
at any time                     thereafter, so long as such amount or interest remains
unpaid, forfeit all or                     any of the shares in respect of which such
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.
|----- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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|16.2. | Upon
the adoption of a resolution of forfeiture, the Board shall cause notice
                    thereof to be given to the Shareholder whose shares are the subject
of such                     forfeiture, 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), such
shares shall be ipso facto forfeited, provided, however,                     that,
prior to the expiration of such period, the Board may nullify such
                    resolution of forfeiture, but no such nullification shall estop the
Board from                     adopting a further resolution of forfeiture in respect of
the non-payment of                     such amount.
|----- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|16.3. | Whenever
shares are forfeited as herein provided, all distributions theretofore
                    declared in respect thereof and not actually paid or distributed
shall be deemed                     to have been forfeited at the same time.
|----- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|16.4. | The
Company, by resolution of the Board, may accept the voluntary surrender of
                    any share.
|----- | -------------------------------------------------------------------------------------------------------------

|16.5. | 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 deems appropriate.
|----- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|16.6. | 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                     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 14.5
above, and the Board, 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, 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.
|----- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|16.7. | The
Board 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 deems appropriate,
but no such nullification                     shall estop the Board from re-exercising
its powers of forfeiture pursuant to                     this Article 16.
|----- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|17. | Lien
|--- | ----

|17.1. | Except
to the extent the same may be waived or subordinated in writing, the
                    Company shall have a first and paramount lien upon all the shares
registered in                     the name of each Shareholder which are not fully paid
up (without regard to any                     equitable or other claim or interest in
such shares on the part of any other                     person), and upon the proceeds
of the sale thereof, for his debts, liabilities                     and engagements
arising from any cause whatsoever, solely or jointly with                     another, to
or with the Company, whether the period for the payment, fulfillment
                    or discharge thereof shall have actually arrived or not. Such lien
shall extend                     to all distributions from time to time declared in
respect of such shares.
|----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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|17.2. | The
Board may cause the Company to sell any shares subject to such lien when any
                    such debt, liability or engagement has matured, in such manner as the
Board may                     deem appropriate, but no such sale shall be made unless
such debt, liability or                     engagement has not been satisfied within
fourteen (14) days after written notice                     of the Companys
intention to sell shall have been served on such                     Shareholder, his
executors or administrators.
|----- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|17.3. | The
net proceeds of any such sale, after payment of the costs thereof, shall be
                    applied in or toward satisfaction of the debts, liabilities or
engagements of                     such Shareholder (whether or not the same have
matured), or any specific part of                     the same (as the Board may
determine), and the balance, if any, shall be paid to                     the
Shareholder, his executors, administrators or assigns.
|----- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|18. | Sale
after Forfeiture or Surrender or in Enforcement of Lien
|--- | ------------------------------------------------------------

| | Upon
any sale of shares after forfeiture or surrender or for enforcing a lien, the Board 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 Shareholder 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 his name has been entered in the
Shareholder 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
Company may, subject to applicable Law, issue redeemable shares and redeem the same.
| | ----------------------------------------------------------------------------------------

|20. | Transfer
of Shares
|--- | ------------------

|20.1. | No
transfer of shares shall be registered unless the Company receives a deed of
                    transfer or other proper instrument of transfer (in form and
substance                     satisfactory to the Board), together with the share
certificate(s) and such                     other evidence of title as the Board may
reasonably require. Until the                     transferee has been registered in the
Shareholder Register in respect of the                     shares so transferred, the
Company may continue to regard the transferor as the                     owner thereof.
The Board may, from time to time, prescribe a fee for the
                    registration of a transfer. A deed of transfer shall be in the
following form or                     in any substantially similar form, including any
such form as is acceptable to                     the transfer agent for the Companys
shares, or in any form otherwise                     approved by the Board.
|----- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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# Deed of Transfer

| | I, _________, (hereinafter: The Transferor) of ________________, do hereby
transfer, in consideration for ____________ , to ______________ (hereinafter: The
Transferee), ______________share(s) NIS 0.01 par value each of BreezCOM Ltd.
(hereinafter: The Company) to be held by the Transferee and/or his
executors, administrators and assigns, subject to the same terms and conditions under
which I held the same at the time of execution hereof; and I, the said Transferee, do
hereby agree to take the said share(s) subject to the conditions aforesaid.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | In
witness whereof we hereby execute this Deed of Transfer, this ___day of ______, 20__.
| | ----------------------------------------------------------------------------------------

| |                       |                          
| | --------------------- | -------------------------
|
|
|
|
| | The Transferor        | The Transferee           
| | Name:_____________    | Name: _________________  
| | Signature: __________ | Signature: ______________
| |                      
| | Witness to Signature: | Witness to Signature:    
| | Name:_____________    | Name: _________________  
| | Signature: __________ | Signature: ______________

|20.2. | The
transfer of shares which are not fully paid, or shares on which the Company
                    has a lien or pledge, shall have no validity unless approved by the
Board, which                     may, in its absolute discretion and without giving any
reason thereto, decline                     the registration of such transfer. The Board
may deny a transfer of shares as                     aforesaid and may also impose as a
condition of the transfer of shares as                     aforesaid an undertaking by
the transferee to meet the obligations of the                     transferor with respect
to the shares, or obligations for which the Company has                     a lien or
pledge on the shares, signed by the transferee, together with the
                    signature of a witness authenticating the signature of the
transferee.
|----- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|20.3. | Upon
the death of a Shareholder, the Company shall recognize the custodian or
                    administrator of the estate or executor of the will, and in the
absence of such,                     the lawful heirs of the Shareholder, as the only
holders of the right for the                     shares of the deceased Shareholder,
after receipt of evidence to the entitlement                     thereto, as determined
by the Board.
|----- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|20.4. | The
Company may recognize the receiver or liquidator of any corporate
                    Shareholder in liquidation 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, after receipt of evidence
to the entitlement thereto,                     as determined by the Board.
|----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|20.5. | A
person acquiring a right in shares as a result of being a custodian,
                    administrator of the estate, executor of a will or the heir of a
Shareholder, or                     a receiver, liquidator or a trustee in a bankruptcy
of a Shareholder or                     according to another provision of Law, is
entitled, after providing evidence of                     his right to the satisfaction
of the Board, to be registered as the Shareholder                     or to transfer such
shares to another person, subject to the provisions of this                     Article
20.
|----- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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|21. | Bearer
Share Certificates
|--- | -------------------------

| | The
Company shall not issue bearer share certificates which grant the bearer rights in the
shares specified therein.
| | --------------------------------------------------------------------------------------------------------------------

# GENERAL MEETINGS

|22. | The
Authority of the General Meeting
|--- | ------------------------------------

|22.1. | Matters
within the authority of the General Meeting
|----- | ---------------------------------------------------

| | The
following matters shall require the approval of the General Meeting:
| | ------------------------------------------------------------------------

| | 22.1.1. | Changes
in the Articles.
| | ------- | ------------------------

| | 22.1.2. | The
exercise by the General Meeting of the authority of the Board, subject to
                    the provisions of the Companies Law, if it is resolved that the Board
is                     incapable of exercising its authority, and that the exercise of
such authority                     is essential to the orderly management of the Company.
| | ------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 22.1.3. | The
appointment or reappointment of the Companys auditor, and the
                    termination or non-renewal of his service.
| | ------- | ---------------------------------------------------------------------------------------------------------------------------------

| | 22.1.4. | The
election of Directors (except as specifically set forth otherwise in these
                    Articles), including external Directors, in accordance with Article
45.3 hereof.
| | ------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 22.1.5. | To
the extent required by the provisions of the Companies Law, the approval of
                    actions and transactions with interested parties and the approval of
an action                     or a transaction of an Office Holder (as defined in Article
62) which might                     constitute a breach of the duty of loyalty.
| | ------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 22.1.6. | Changes
in the share capital of the Company, as set forth in Articles 7, 8 and 9
                    hereof.
| | ------- | ------------------------------------------------------------------------------------------------------------

| | 22.1.7. | A
merger of the Company, as defined in the Companies Law.
| | ------- | ---------------------------------------------------------

| | 22.1.8. | A
liquidation of the Company.
| | ------- | -----------------------------

| | 22.1.9. | Any
other matters which the Companies Law requires to be dealt with at the
                    General Meeting of the Company, or any matters which were given to
the General                     Meeting in these Articles.
| | ------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|22.2. | The
General Meeting shall not transfer to another organ of the Company any of
                    its authorities detailed in Article 22.1 above.
|----- | -------------------------------------------------------------------------------------------------------------------------------------------------

11

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|22.3. | The
General Meeting, by a resolution adopted by an Ordinary Majority, may assume
                    the authority which is given to another organ of the Company;
provided however,                     that such taking of authorities shall be with
regard to a specific issue or for                     a specific period of time, all as
stated in the resolution of the General                     Meeting regarding such taking
of authorities.
|----- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|23. | Annual
Meeting
|--- | --------------

|23.1. | 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. These
General Meetings shall be                     referred to as Annual Meetings.
|----- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|23.2. | An
Annual Meeting shall be convened to discuss the following issues:
|----- | --------------------------------------------------------------------

| | 23.2.1. | The
financial statements of the Company, as of the end of the fiscal year
                    preceding the year of the Annual Meeting, and the report of the Board
with                     respect thereto.
| | ------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 23.2.2. | The
report of the Board with respect to the fee paid to the Companys
                    auditor.
| | ------- | --------------------------------------------------------------------------------------------------

| | 23.2.3. | The
election of Directors in accordance with Article 45 below.
| | ------- | --------------------------------------------------------------

|23.3. | The
agenda at an Annual Meeting may include the following issues, in addition to
                    those referred to in Article 23.2:
|----- | ---------------------------------------------------------------------------------------------------------------------------------------

| | 23.3.1. | The
appointment of an auditor or the renewal of his office.
| | ------- | -----------------------------------------------------------

| | 23.3.2. | Any
other issue which was detailed in the agenda for the Annual Meeting.
| | ------- | ------------------------------------------------------------------------

|24. | Extraordinary
Meetings
|--- | ----------------------

|24.1. | All
General Meetings other than Annual Meetings shall be referred to as
                    Extraordinary Meetings. An Extraordinary Meeting shall
discuss and                     decide in all matters which are not discussed and decided
in the Annual Meeting,                     and for which the Extraordinary Meeting was
convened.
|----- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|24.2. | The
Board may, whenever it deems appropriate, convene an Extraordinary Meeting
                    at such time and place, within or without the State of Israel, as may
be                     determined by the Board, and shall be obliged to do so upon the
demand of one of                     the following:
|----- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 24.2.1. | Any
two Directors or a quarter of the Directors, whichever is lower; or
| | ------- | -----------------------------------------------------------------------

| | 24.2.2. | Any
one or more Shareholders, holding alone or together at least five percent
                    (5%) of the issued share capital of the Company.
| | ------- | --------------------------------------------------------------------------------------------------------------------------------------------------

12

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|24.3. | The
Board, upon demand to convene an Extraordinary Meeting in accordance with
                    Article 24.2 above, shall announce the convening of the General
Meeting within                     twenty one (21) days from the receipt of a demand in
that respect; provided,                     however, that the date fixed for the
Extraordinary Meeting shall not be more                     than thirty five (35) days
from the publication date of the announcement of the                     Extraordinary
Meeting, or such other period as may be permitted by the Companies
                    Law or Companies Regulations.
|----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|25. | Class
Meetings
|--- | --------------

| | The
provisions of these Articles of Association with respect to General Meetings shall apply,
mutatis mutandis, to meetings of the holders of a class of shares of the Company
(hereinafter: Class Meetings); provided, however, that the requisite quorum
at any such Class Meeting shall be one or more Shareholders present in person, by proxy
or by deed of vote, and holding together not less than fifty percent (50%) of the issued
shares of such class.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|26. | Notice
of General Meetings
|--- | --------------------------

|26.1. | Unless
a shorter period is permitted by Law, a notice of a General Meeting shall
                    be sent to each Shareholder of the Company registered in the
Shareholder                     Register and entitled to attend and vote at such meeting,
at least twenty one                     (21) days prior to the date fixed for the General
Meeting. Subject to the                     provisions of any Law, each such notice shall
specify the place, the day and                     hour of the meeting, the agenda of the
meeting, the proposed resolution(s) or a                     concise description thereof,
and the arrangements for voting by means of a proxy                     and, if
applicable, a deed of vote. Anything herein to the contrary
                    notwithstanding, with the written consent of all Shareholders
entitled to vote                     thereon, a resolution may be proposed and passed at
such meeting although a                     shorter notice than hereinabove prescribed
has been given. A waiver by a                     Shareholder can also be made in writing
after the fact and even after the                     convening of the General Meeting.
|----- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|26.2. | Notwithstanding
anything to the contrary herein, notice by the Company of a                     General
Meeting may be effected, in addition to any means provided in these
                    Articles, by any other means permitted by, and in accordance with the
                    requirements of, the Companies Law or Companies Regulations.
|----- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|26.3. | Any
accidental omission with respect to the giving of a notice of a General
                    Meeting to any Shareholder or the non-receipt of a notice with
respect to a                     meeting or any other notice on the part of any
Shareholder shall not cause the                     cancellation of a resolution adopted
at that meeting, or the cancellation of                     acts based on such notice.
|----- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

13

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# PROCEEDINGS AT GENERAL
MEETINGS

|27. | The
Agenda of General Meetings
|--- | ------------------------------

|27.1. | The
agenda of General Meetings shall be determined by the Board and shall also
                    include issues for which an Extraordinary Meeting is being convened
in                     accordance with Article 24 above, or as may be required upon the
request of                     Shareholders in accordance with the provisions of the
Companies Law.
|----- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|27.2. | The
General Meeting shall only adopt resolutions on issues which are on its
                    agenda.
|----- | -------------------------------------------------------------------------------------------------------

|27.3. | The
General Meeting is entitled to accept or reject a proposed resolution which
                    is on the agenda of the General Meeting. Subject to applicable Law,
the General                     Meeting may adopt a resolution which is different from
the description thereof                     included in the notice of the General
Meeting, provided that such resolution is                     not materially different
from the proposed resolution.
|----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|28. | Quorum
|--- | ------

|28.1. | No
business shall be transacted at a General Meeting, or at any adjournment
                    thereof, unless a lawful quorum is present when the meeting proceeds
to                     business.
|----- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|28.2. | Subject
to the requirements of the Companies Law, the rules of Nasdaq National
                    Market and any other exchange on which the Companys securities
are or may                     become quoted or listed, and the provisions of these
Articles, any two or more                     Shareholders (not in default in payment of
any sum referred to in                     Article 14 hereof), present in person or
by proxy, or who have delivered to                     the Company a deed of vote
indicating their manner of voting, and who hold or                     represent in the
aggregate at least thirty-three and one-third percent (33 1/3%)                     of
the voting power of the Company, shall constitute a lawful quorum at General
                    Meetings. A Shareholder or his proxy, who also serves as a proxy for
other                     Shareholder(s), shall be regarded as two or more Shareholders,
in accordance                     with the number of Shareholders he is representing.
|----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|28.3. | If
within an hour from the time appointed for the General Meeting a quorum is
                    not present, the meeting, if convened by the Board upon demand under
Article                     24.2 or, if not convened by the Board, if convened by the
demanding                     Shareholder(s) in accordance with the provisions of the
Companies Law, shall be                     dissolved, but in any other case it shall
stand adjourned to the same day in the                     next week (or the first
Business Day thereafter), 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 or by deed of vote and voting on
the question of                     adjournment. No business shall be transacted at any
adjourned meeting except                     business which 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 or by proxy or by deed of vote, shall constitute a
                    lawful quorum.
|----- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

14

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|29. | Chairman
|--- | --------

| | The
Chairman of the Board shall preside as Chairman at every General Meeting. If there is no
such Chairman, or if the Chairman is not present within fifteen (15) minutes after the
time fixed for holding such meeting or is unwilling to act as Chairman, the Shareholders
present shall choose someone of their number or any other person to be Chairman. The
position 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 is also a Shareholder or proxy, respectively).
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|30. | Adjourned
Meeting
|--- | -----------------

| | A
General Meeting at which a lawful quorum is present (hereinafter: The Original
General Meeting), may resolve by an Ordinary Majority to adjourn the General
Meeting, from time to time, to another time and/or place (hereinafter: an Adjourned
Meeting). In the event that a General Meeting is adjourned for twenty one (21) days
or more, a notice of the Adjourned Meeting shall be given in the same manner as the notice
of the Original General Meeting. With the exception of the aforesaid, a Shareholder shall
not be entitled to receive a notice of an Adjourned Meeting or of the issues which are to
be discussed in the Adjourned Meeting. The Adjourned Meeting shall only discuss issues
that could have been discussed at the Original General Meeting, and with respect to which
no resolution was adopted.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|31. | Adoption
of Resolutions at General Meetings
|--- | -------------------------------------------

|31.1. | All
resolutions of the General Meeting, including those with respect to the
                    matters detailed in Article 22.1, shall be adopted by an Ordinary
Majority,                     except with respect to Article 22.1.8 which resolution
shall be adopted by a                     Special Majority, and with respect to the
amendment of this Article 31.1 or                     Articles 45.1, 45.3 and 47.5 each
of which amendments shall be adopted by the                     vote of the holders of
seventy five percent (75%) of the voting power                     represented at a
General Meeting in person, by proxy or by deed of vote and                     voting
thereon (an Extraordinary Resolution), or any other matter
                    with respect to which a greater majority is required by these
Articles or by the                     Companies Law.
|----- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|31.2. | Every
matter 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, by                     proxy or by deed of vote 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.
|----- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

15

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|31.3. | A
declaration by the Chairman of the meeting that a resolution has been adopted
                    unanimously, or adopted by a particular majority, or rejected, and an
entry to                     that effect in the minute book of the Company, shall be
conclusive evidence of                     the fact without proof of the number or
proportion of the votes recorded in                     favor of or against such
resolution.
|----- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|32. | Resolutions
in Writing
|--- | ----------------------

| | A
resolution in writing signed by all Shareholders of the Company then entitled to attend
and vote at General Meetings or to which all such Shareholders have given their written
consent (by letter, facsimile, telegram, telex or otherwise), or their oral consent by
telephone (provided that a written summary thereof has been approved and signed by the
Chairman of the Board) shall be deemed to have been unanimously adopted by a General
Meeting duly convened and held. Such resolution could be stated in several counterparts
of the same document, each of them signed by one Shareholder or by several Shareholders.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|33. | Voting
Power
|--- | ------------

| | Subject
to the provisions of Article 34.1 and 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 him of record, on every resolution, without regard to
whether the vote thereon is conducted in person, by proxy or by deed of vote, by a show of
hands, by written ballot or by any other means.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|34. | Voting
Rights
|--- | -------------

|34.1. | No
Shareholder shall be entitled to vote at any General Meeting (or be counted
                    as a part of the lawful quorum thereat), unless all calls and other
sums then                     payable by him in respect of his shares in the Company have
been paid, but this                     Article shall not apply to Class Meetings
pursuant to Article 25.
|----- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|34.2. | A
company or other corporate entity being 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 which                     the latter could have exercised
if it were an individual shareholder. 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 him.
|----- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|34.3. | Any
Shareholder entitled to vote may vote either personally (or, if the
                    Shareholder is a company or other corporate entity, by a
representative                     authorized pursuant to Article 34.2) or by proxy
(subject to Article 37                     below), or by deed of vote in accordance with
Article 40 below.
|----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

16

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|34.4. | If
two or more persons are registered as joint holders of any share, the vote of
                    the senior who tenders a vote, in person, by proxy or by deed of
vote, 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 Shareholder Register.
|----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|35. | The
Determining Date with Respect to Participation and Voting
|--- | -------------------------------------------------------------

| | The
Shareholders who are entitled to participate and vote at a General Meeting shall be those
Shareholders who are registered in the Shareholder Register of the Company on the date
determined by the Board, provided that such date not be more than twenty one (21) days,
nor less than four (4) days, prior to the date of the General Meeting, except as
otherwise permitted by the Companies Regulations.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|36. | Personal
Interest in Resolution
|--- | -------------------------------

|36.1. | A
Shareholder seeking to vote with respect to a resolution which requires that
                    the majority for its adoption include at least a certain percentage
of the votes                     of all those not having a personal interest (as defined
in the Companies Law) in                     the resolution, shall notify the Company at
least two (2) Business Days prior to                     the date of the General Meeting,
whether or not he has a personal interest in                     the resolution,as
a condition for his right to vote and be counted with                     respect to such
resolution.
|----- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|36.2. | A
Shareholder voting on a resolution, as aforesaid, by means of a deed of vote
                    or a deed of authorization of a proxy, may include his notice with
respect to                     his personal interest on the deed of vote or deed of
authorization, as the case                     may be.
|----- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

# PROXIES

|37. | Voting
by Means of a Proxy
|--- | --------------------------

|37.1. | A
Shareholder registered in the Shareholder Register is entitled to
                    appoint by deed of authorization a proxy (who is not required to be a
                    Shareholder of the Company) to participate and vote in his stead,
whether at a                     certain General Meeting or generally at General Meetings
of the Company, whether                     personally or by means of a deed of vote.
|----- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|37.2. | In
the event that the deed of authorization is not limited to a certain General
                    Meeting, then the deed of authorization, which was deposited prior to
a certain                     General Meeting, shall also be good for other General
Meetings thereafter. This                     Article 37 shall also apply to a
Shareholder which is a corporation, appointing                     a person to
participate and vote in a General Meeting in its stead.
|----- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

17

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|38. | A
Deed of Authorization
|--- | -----------------------

|38.1. | The
deed of authorization of a proxy shall be in writing and shall be
                    substantially in the form specified below, or in any usual or common
form or in                     such other form as may be approved by the Board. It shall
be duly signed by the                     appointer or his duly authorized attorney or,
if such appointer is a company or                     other corporate entity, under its
common seal or stamp or the hand of its duly                     authorized agent(s) or
attorney(s).
|----- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

# Deed of Authorization

| | To:
Alvarion Ltd.  Attn: Corporate Secretary
| | --------------------------------------------

| | I _____________________ of __________________________________  (Name of Shareholder)                              
        (Address of Shareholder)
| | ---------------------------------------------------------------------------------------------------------------------------------------------------

| | being
a registered  holder of __________  Ordinary  Shares having a par value of NIS 0.01 each,
           of Alvarion Ltd. hereby appoint
| | ------------------------------------------------------------------------------------------------------------------------------------------

| | ________________________ of ____________________________  (Name of Proxy)                                             (Address of Proxy)
| | ----------------------------------------------------------------------------------------------------------------------------------------

| | as
my proxy to participate and vote for me and in my stead 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 / at any General Meeting of the Company, until I shall otherwise
notify you.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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

| | _________________________
           (Signature of Appointer)
| | -------------------------------------------------------------

|38.2. | The
deed of authorization of 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
such place as the Board                     may specify) not less than two (2) hours (or
not less than twenty four (24)                     hours with respect to a General
Meeting to be held outside of Israel) before the                     time fixed for the
meeting at which the person named in the deed of                     authorization
proposes to vote, or presented to the Chairman at such meeting.
|----- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|39. | Effect
of Death of Appointer or Revocation of Appointment
|--- | ---------------------------------------------------------

| | A
vote cast pursuant to a deed of authorization of a proxy shall be valid notwithstanding
the previous death, incapacity or bankruptcy, or if a company or other corporate entity,
the liquidation, 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 notice of any such event
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 General Meeting, may revoke the appointment by means of a writing, oral
notification to the Chairman, or otherwise.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

18

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# DEED OF VOTE

|40. | General
|--- | -------

|40.1. | A
Shareholder may vote in a General Meeting by means of a deed of vote on any of
                    the following issues that shall arise in the General Meeting:
|----- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 40.1.1. | All
issues detailed in Article 22.1.1 through 22.1.8 above;
| | ------- | -----------------------------------------------------------

| | 40.1.2. | Any
other issue which the Articles provide can be voted thereon by means of a
                    deed of vote.
| | ------- | ---------------------------------------------------------------------------------------------------------------

| | 40.1.3. | Any
other issues which may be permitted by the Companies Law or the Companies
                    Regulations.
| | ------- | --------------------------------------------------------------------------------------------------------------

|40.2. | The
deed of vote shall be signed by the Shareholder and shall be in any form
                    acceptable to the Board.
|----- | -------------------------------------------------------------------------------------------------------------------------

|40.3. | To
the extent required by the Companies Law and Companies Regulations, the deed
                    of vote shall be sent by the Company, at its expense, to the
Shareholders of the                     Company who are entitled to vote in the General
Meeting, together with the                     notice with respect to the General
Meeting.
|----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|40.4. | A
duly executed deed of vote which was received at the registered office of the
                    Company at least two (2) Business Days prior to the date of the
General Meeting,                     shall constitute the participation and voting of the
Shareholder who has                     delivered it, for each and every purpose,
including for the purpose of                     determining the lawful quorum at a
General Meeting. A deed of vote received by                     the Company, in
accordance with this Article, with respect to a certain issue                     which
was not voted on at the General Meeting, shall be viewed as an                     abstain with
respect to the resolution to adjourn the General                     Meeting and, at any
adjourned General Meeting, shall be counted and voted in                     accordance
with the manner set forth therein.
|----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|41. | The
Disqualification of Deeds of Vote and Deeds of Authorization
|--- | ----------------------------------------------------------------

| | Subject
to the provisions of applicable Law, the corporate secretary of the Company may, in his
discretion, disqualify deeds of vote and deeds of authorization and so notify the
Shareholder who submitted a deed of vote or deeds of authorization in the following cases:
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|41.1. | If
there is a reasonable suspicion that they are forged or falsified;
|----- | ---------------------------------------------------------------------

|41.2. | If
they are not duly executed or completed;
|----- | -------------------------------------------

|41.3. | If
there is a reasonable suspicion that they are given with respect to shares
                    for which one or more deeds of vote or deeds of authorization have
been given                     and not withdrawn;
|----- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

19

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|41.4. | If
more than one choice is marked for the same resolution; or
|----- | -------------------------------------------------------------

|41.5. | With
respect to resolutions which require that the majority for their adoption
                    include a certain percentage of those not having a personal interest
in the                     approval of the resolution, where it was not marked, or
otherwise notified to                     the Company, whether or not the relevant
Shareholder has a personal interest.
|----- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|42. | Board
Recommendation
|--- | --------------------

|42.1. | The
Board, and any other person upon whose lawful demand an Extraordinary
                    Meeting is convened by the Board, may send to the Shareholders a
recommendation                     in order to persuade them with respect to any matter
specified in Article 40.1                     above, which is on the agenda of such
General Meeting. The recommendation shall                     be delivered at the expense
of the Company, together with the deed of vote, if                     so required by
Law. In the event that a General Meeting in convened with respect                     to
any of the matters specified in Article 40.1 above, any Shareholder may
                    submit to the Company, no later than fourteen (14) days prior to the
date of the                     General Meeting, a request that a recommendation be
delivered on his behalf to                     the other Shareholders, together with the
form of such recommendation. Unless it                     is otherwise provided by Law,
such recommendation shall be delivered by the                     Company at the expense
of such Shareholder.
|----- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|42.2. | The
Board may send to the Shareholders a recommendation in response to a
                    recommendation delivered in accordance with the provisions of this
Article, or                     in response to any other submission to the Shareholders.
Such recommendation                     shall be delivered at the expense of the Company.
|----- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

# BOARD OF DIRECTORS

|43. | The
Authority of the Board
|--- | --------------------------

|43.1. | The
authority of the Board is as specified in the Companies Law and in the
               provisions of these Articles.
|----- | -----------------------------------------------------------------------------------------------------------------------

|43.2. | The
Board may exercise any authority of the Company which is not, by the
               Companies Law or by these Articles, required to be exercised by another
organ of                the Company.
|----- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|43.3. | Without
derogating from the generality of Articles 43.1 and 43.2 above, the                Boards
authority shall include the following:
|----- | -----------------------------------------------------------------------------------------------------------------------------------------

| | 43.3.1. | The
Board may, from time to time, in its discretion, cause the Company to borrow
               or secure the payment of any sum or sums of money for the purposes of the
               Company, and may secure or provide for the repayment of such sum or sums
in such                manner, at such times and upon such terms and conditions in all
respects as it                deems appropriate, including, without limitation, by the
issuance of bonds,                perpetual or redeemable debentures or other securities,
or any mortgages,                charges, or other liens on the undertaking or the whole
or any part of the                property of the Company, both present and future,
including its uncalled or                called but unpaid capital.
| | ------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

20

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| | 43.3.2. | The
Board may, from time to time, set aside any amount(s) out of the profits of
               the Company as a reserve or reserves for any purpose(s) which the Board,
in its                sole discretion, shall deem appropriate, and may invest any sum so
set aside in                any manner and from time to time deal with and vary such
investments, and                dispose of all or any part thereof, and employ any such
reserve or any part                thereof in the business of the Company without being
bound to keep the same                separate from other assets of the Company, and may
subdivide or redesignate any                reserve or cancel the same or apply the funds
therein for another purpose, all                as the Board may from time to time deem
appropriate.
| | ------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 43.3.3. | Subject
to the provisions of any Law, the Board may, from time to time,                authorize
any person to be the representative of the Company with respect to                those
objectives and subject to those conditions and for that time period, as
               the Board deems appropriate, and may also grant any such representative
the                authority to delegate any or all of the authorities, powers and
discretion given                to him by the Board.
| | ------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|44. | Board
Meetings
|--- | --------------

|44.1. | Convening
Meetings of the Board
|----- | -------------------------------

| | 44.1.1. | The
Chairman of the Board may convene a meeting of the Board at any time;
               provided that a meeting of the Board be convened at least once every three
(3)                months.
| | ------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 44.1.2. | The
Chairman of the Board shall convene a meeting of the Board at any time or in
               any event that such meeting is required by the provisions of the Companies
Law.
| | ------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|44.2. | Notice
of a Meeting of the Board
|----- | --------------------------------

| | 44.2.1. | Any
notice with respect to a meeting of the Board may be given orally or in
               writing, so long as the notice is given at least seven (7) days prior to
the                date fixed for the meeting, unless all members of the Board or their
Alternate                Directors (as defined in Article 46.1.1) or their
representatives agree on a                shorter time period. Such notice shall be
delivered personally, by mail, or                transmitted via facsimile or e-mail or
through another means of communication,                to the address, facsimile number
or to the e-mail address or to an address where                messages can be delivered
through other means of communication, as the case may                be, as the Director
informed the Company in advance.
| | ------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 44.2.2. | A
notice with respect to a meeting of the Board shall include the venue, date
               and time of the meeting of the Board, the issues on its agenda and any
other                material that the Chairman of the Board requests to be included in
the notice                with respect to the meeting.
| | ------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

21

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|44.3. | The
Agenda of Board Meetings
|----- | ----------------------------

| | The
agenda of any meeting of the Board shall be as determined by the Chairman of the Board,
and shall include the following matters:
| | ------------------------------------------------------------------------------------------------------------------------------------

| | 44.3.1. | Matters
for which the meeting is required to be convened in accordance with the
               Companies Law;
| | ------- | -------------------------------------------------------------------------------------------------------------

| | 44.3.2. | Any
matter requested by a Director or by the General Manager to be included in
               the meeting within a reasonable time (taking into account the nature of
the                matter) prior to the date of the meeting;
| | ------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 44.3.3. | Any
other matter determined by the Chairman of the Board.
| | ------- | ---------------------------------------------------------

|44.4. | Quorum
|----- | ------

| | Unless
otherwise unanimously decided by the Board, a quorum at a meeting of the Board shall be
constituted by the presence 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 ), but shall not be less than two Directors.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|44.5. | Conducting
a Meeting Through Means of Communication
|----- | ---------------------------------------------------

| | The
Board may conduct a meeting of the Board through the use of any means of communication,
provided all of the participating Directors can hear each other simultaneously. A
resolution approved by use of means of communications as aforesaid, shall be deemed to be
a resolution lawfully adopted at a meeting of the Board.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|44.6. | Voting
in the Board
|----- | -------------------

| | Unless
otherwise provided by these Articles, issues presented at meetings of the Board shall be
decided upon by a majority of the votes of Directors present (or participating, in the
case of a vote through a permitted means of communications) and lawfully entitled to vote
thereon (as conclusively determined by the Chairman of the Board). Subject to the
provision of Article 46.2.2 below, with respect to representatives of Directors that are
companies, each Director shall have a single vote.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|44.7. | Written
Resolution
|----- | ------------------

| | A
resolution in writing signed by all Directors then in office and lawfully entitled to
vote thereon (as conclusively determined by the Chairman of the Board) or to which all
such Directors have given their consent (by letter, telegram, telex, facsimile, e-mail or
otherwise), or their oral consent by telephone (provided that a written summary thereof
has been approved and signed by the Chairman of the Board), shall be deemed to have been
unanimously adopted by a meeting of the Board duly convened and held.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

22

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|45. | The
Appointment of Directors
|--- | ----------------------------

|45.1. | The
Number of Directors
|----- | -----------------------

| | The
Board shall consist of such number of Directors, not less than four (4) nor more than ten
(10) (including the External Directors).
| | --------------------------------------------------------------------------------------------------------------------------------------

|45.2. | Directors
Generally
|----- | -------------------

| | 45.2.1. | Subject
to the provisions of the Companies Law, a Director may hold another
               position in the Company.
| | ------- | -------------------------------------------------------------------------------------------------------------------

| | 45.2.2. | A
company or other corporate entity may serve as a Director in the Company,
               subject to the provisions of Articles 46.2 and 46.3 below.
| | ------- | -----------------------------------------------------------------------------------------------------------------------------------------------------

| | 45.2.3. | The
Board shall include external Directors as may be required to comply with the
               requirements of Companies Law, the Nasdaq Stock Market or any other
securities                exchange on which the securities of the Company are or may
become quoted or                listed.
| | ------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|45.3. | The
Election of Directors and their Terms of Office
|----- | ---------------------------------------------------

| | 45.3.1. | Subject
to Article 45.3.3 below, a certain number of the Directors (excluding                the
External Directors) shall be elected each year at the Annual General Meeting
               by a resolution adopted by an Ordinary Majority; provided however that
External                Directors shall be elected in accordance with applicable Law
and/or any                securities exchange rule applicable to the Company. The
Directors shall commence                the terms of their office from the close of the
Annual Meeting at which they are                elected, unless a later date is stated in
the resolution with respect to their                appointment, and, subject to the
provisions of the Companies Law with respect to                External Directors, shall
serve in office until the close of the third Annual                Meeting following the
Annual General Meeting at which such Directors are                elected, unless their
office is vacated earlier in accordance with the                provisions of Law or
these Articles.
| | ------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 45.3.2. | Reserved.
| | ------- | ---------

| | 45.3.3. | The
General Meeting, by a resolution adopted by an Ordinary Majority, or the
               Board, upon approval of the majority of the Directors of the Company, may
elect                any person as a Director, to fill an office which became vacant, and
also in any                event in which the number of members of the Board is less than
the minimum set                in Article 45.1 above. Any Director elected in such manner
shall serve in office                until the coming Annual Meeting.
| | ------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

23

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|46. | Alternate
Directors and Representative of a Director that is a Company
|--- | ----------------------------------------------------------------------

|46.1. | Alternate
Directors
|----- | -------------------

| | 46.1.1. | Subject
to the provisions of the Companies Law, any Director may, by written
               notice to the Company, appoint an alternate for himself (in these
Articles, an                Alternate Director), dismiss 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, whether for a certain                meeting or a certain period of time or
generally. Any notice given to the                Company pursuant to this Article shall
be in writing, delivered to the Company                and signed by the appointing or
dismissing Director, and shall become effective                on the date fixed therein,
or upon the delivery thereof to the Company,                whichever is later.
| | ------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 46.1.2. | Anyone
who is not qualified to be appointed as a Director and/or anyone serving
               as a Director or as an existing Alternate Director may not be appointed
and may                not serve as an Alternate Director.
| | ------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|46.2. | Representative
of a Director that is a Company
|----- | ----------------------------------------------

| | 46.2.1. | A
Director that is a company or other corporate entity shall appoint an
               individual, qualified to be appointed as a Director in the Company, in
order to                serve on its behalf, either for a certain meeting or for a
certain period of                time or generally and such company or other entity may
also dismiss that                individual and appoint another in his stead
(hereinafter: Directors                Representatives). Any notice
given to the Company pursuant to this Article                shall be in writing,
delivered to the Company and signed by the appointing or                dismissing body,
and shall become effective on the date fixed therein, or upon                the delivery
thereof to the Company, whichever is later.
| | ------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 46.2.2. | Subject
to Article 46.2.1, any person, whether or not a Director, may serve as a
               Directors Representative. One person may act as a Directors
               Representative of several Directors, and in such event he shall have a
number of                votes (and shall be treated as the number of persons for
purposes of                establishing a quorum) equal to the number of Directors for
whom he acts as a                Directors Representative. If a Directors
Representative is also a                Director in his own right, his rights as a
Directors Representative shall                be in addition to his rights as a
Director.
| | ------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|46.3. | Provisions
with Respect to Alternate Directors and Directors                Representatives
|----- | --------------------------------------------------------------------------------------------

| | 46.3.1. | An
Alternate Director and a Directors Representative shall have all the
               authority of the Director who appointed him, provided, however, that he
may not                in turn appoint an alternate or a representative for himself
(unless the                instrument appointing him otherwise expressly provides), and
provided further                that an Alternate Director and a Directors
Representative shall have no                standing at any meeting of the Board or any
committee thereof while the Director                who appointed him is present.
| | ------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

24

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| | 46.3.2. | The
office of an Alternate Director or a Directors Representative shall be
               vacated under the circumstances, mutatis mutandis, set forth in
               Article 47, and such office shall ipso facto be vacated if
the                Director who appointed such Alternate Director or Directors
Representative                ceases to be a Director.
| | ------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|47. | Termination
of the Term of a Director
|--- | -------------------------------------

| | Subject
to the provisions of the Companies Law with respect to external Directors, the term of a
Director shall terminate in any of the following cases:
| | --------------------------------------------------------------------------------------------------------------------------------------------------------

|47.1. | If
he resigned from his office by way of a signed letter, filed with the
                    corporate secretary at the Companys office;
|----- | -----------------------------------------------------------------------------------------------------------------------------------------

|47.2. | If
he is declared bankrupt;
|----- | ---------------------------

|47.3. | If
he is declared by an appropriate court to be incapacitated;
|----- | --------------------------------------------------------------

|47.4. | Upon
his death and, in the event of a company or other corporate entity, upon
                    the adoption of a resolution for its voluntary liquidation or the
issuance of a                     liquidation order;
|----- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|47.5. | If
he is removed from his office by way of a resolution adopted by the General
                    Meeting by an Extraordinary Resolution;
|----- | ------------------------------------------------------------------------------------------------------------------------------------------

|47.6. | If
he is convicted of a crime requiring his termination pursuant the Companies
                    Law; or
|----- | ----------------------------------------------------------------------------------------------------------

|47.7. | If
his term of office is terminated by the Board in accordance with the
                    provisions of the Companies Law.
|----- | ----------------------------------------------------------------------------------------------------------------------------

|48. | Continuing
Directors in the Event of Vacancies
|--- | ----------------------------------------------

| | In
the event of one or more vacancies in the Board, the continuing Directors may continue to
act in every matter; provided, however, that if the number of continuing Directors is
less than the minimum number provided for pursuant to Article 45.1 hereof, and
unless the vacancy or vacancies is filled by the Board pursuant to Article 45.3.3, they
may only act for the convening of a General Meeting for the purpose of electing
Director(s) to fill any or all vacancies.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|49. | Compensation
of Directors
|--- | -------------------------

|49.1. | Directors
who do not hold other positions in the Company and who are not
                    external Directors shall not receive any compensation from the
Company, unless                     such compensation and its amount are approved by the
General Meeting, subject to                     applicable Law.
|----- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

25

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|49.2. | The
compensation of the Directors may be fixed, as an all-inclusive payment or
                    as payment for participation in meetings or as any combination
thereof.
|----- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|49.3. | The
Company may reimburse expenses incurred by a Director in connection with the
                    performance of his duties as a Director, to the extent provided in a
resolution                     of the Board.
|----- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|50. | Personal
Interest of a Director
|--- | -------------------------------

| | Subject
to compliance with the provisions of the Companies Law, the Company may enter into any
contract or otherwise transact any business with any Director and may enter into any
contract or otherwise transact any business with any third party in which contract or
business a Director has a personal interest, directly or indirectly.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|51. | Committees
of the Board of Directors
|--- | ------------------------------------

|51.1. | Subject
to the provisions of the Companies Law, the Board may delegate its
               authorities or any part of them to committees, as it deems appropriate,
and it                may from time to time cancel the delegation of any such authority.
Any such                committee, while utilizing an authority as stated, is obligated
to fulfil all of                the instructions given to it from time to time by the
Board.
|----- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|51.2. | Subject
to the provisions of the Companies Law, the rules of the Nasdaq National
               Market or any other exchange on which the Companys securities are or
may                become quoted or listed, each committee of the Board shall consist of
at least                two (2) Directors, of which at least one shall be an external
Director; provided                that the audit committee shall consist of at least
three (3) Directors, and all                of the external Directors of the Company
shall be members of it.
|----- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|51.3. | The
provisions of these Articles with respect to meetings of the Board shall
               apply, mutatis  mutandis, to the meetings and discussions of
each                committee of the Board, provided that no other terms are set by the
Board in                this matter, and provided that the lawful quorum for the meetings
of the                committee, as stated, shall be at least a majority of the members
of the                committee, unless otherwise required by Law.
|----- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|52. | Chairman
of the Board
|--- | ---------------------

|52.1. | Appointment
|----- | -----------

| | 52.1.1. | The
Board shall choose one of its members to serve as the Chairman of the Board.
               Unless otherwise provided in the appointing resolution, the Chairman of
the                Board shall be appointed every calendar year at the first meeting of
the Board                held after the General Meeting in which Directors were appointed
to the Company.
| | ------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

26

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| | 52.1.2. | In
the event that the Chairman of the Board ceases to serve as a Director in the
               Company, the Board, in its first meeting held thereafter, shall appoint
one of                its members to serve as a new Chairman who will serve in his
position for the                term set in the appointment resolution, and if no period
is set, until the                appointment of a new Chairman, as provided in this
Article.
| | ------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 52.1.3. | In
the event that the Chairman of the Board is absent from a meeting of the
               Board within fifteen (15) minutes of the time fixed for the meeting, or if
he is                unwilling to preside at the meeting, the Board shall appoint one of
the                Directors present to preside at the meeting.
| | ------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|52.2. | Authority
|----- | ---------

| | 52.2.1. | The
Chairman of the Board shall preside over meetings of the Board and shall
               sign the minutes of the meetings.
| | ------- | -----------------------------------------------------------------------------------------------------------------------------

| | 52.2.2. | In
the event of deadlock vote, the Chairman of the Board shall not have an
               additional or casting vote.
| | ------- | ---------------------------------------------------------------------------------------------------------------------

| | 52.2.3. | The
Chairman of the Board is entitled, at all times, at his initiative or
               pursuant to a resolution of the Board, to require reports from the General
               Manager in matters pertaining to the business affairs of the Company.
| | ------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 52.2.4. | The
Chairman of the Board shall not serve as the General Manager of the Company,
               unless he is appointed in accordance with the provisions of the Companies
Law.
| | ------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 52.2.5. | The
Chairman of the Board shall not serve as a member of the audit committee.
| | ------- | -----------------------------------------------------------------------------

|53. | Validity
of Acts Despite Defects
|--- | --------------------------------

| | Subject
to the provisions of the Companies Law, all acts done bona fide at any meeting of the
Board, or of a committee of the Board, 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 was
no such defect or disqualification.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

# MINUTES

|54. | Minutes
|--- | -------

|54.1. | Minutes
of each General Meeting and of each meeting of the Board shall be
                    recorded and duly entered in books provided for that purpose. Such
minutes shall                     set forth all resolutions adopted at the meeting and,
with respect to minutes of                     Board meetings, the names of the persons
present at the meeting.
|----- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

27

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|54.2. | 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.
|----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

# OFFICERS; AUDITOR

|55. | The
General Manager
|--- | -------------------

|55.1. | The
Board shall appoint a General Manager, and may appoint more than one General
                    Manager. Subject to Article 52.2.4, the General Manager may be a
Director. Such                     appointment(s) may be either for a fixed term or
without any limitation of time,                     and the Board of Directors may from
time to time (subject to the provisions of                     the Companies Law and of
any contract between any such person and the Company)                     fix his or
their salaries and emoluments, remove or dismiss him or them from
                    office and appoint another or others in his or their place or places.
|----- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|55.2. | The
Authority of the General Manager
|----- | ------------------------------------

| | 55.2.1. | The
General Manager is responsible for the day-to-day management of the affairs
                    of the Company within the framework of the policies set by the Board
and subject                     to its instructions.
| | ------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 55.2.2. | The
General Manager shall have all managerial and operational authorities which
                    were not conferred by Law or pursuant to these Articles to any other
organ of                     the Company, and he shall be under the supervision of the
Board.
| | ------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 55.2.3. | In
the event the Board appoints more than one General Manager, the Board may
                    determine the respective positions and functions of the General
Managers and                     allocate their authorities as the Board may deem
appropriate.
| | ------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 55.2.4. | The
Board may assume the authority granted to the General Manager, either with
                    respect to a certain issue or for a certain period of time.
| | ------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 55.2.5. | In
the event that the General Manager is unable to exercise his authority, the
                    Board may exercise such authority in his stead, or authorize another
to exercise                     such authority.
| | ------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 55.2.6. | The
General Manager, with the approval of the Board, may delegate to his
                    subordinates any of his authority.
| | ------- | -------------------------------------------------------------------------------------------------------------------------------

|56. | Internal
Controller
|--- | -------------------

|56.1. | The
Board shall appoint an internal controller to the Company in accordance with
                    the proposal of the audit committee and with the provisions of the
Companies                     Law. The internal controller shall report to the Chairman
of the Board, the                     General Manager and the Chairman of the audit
committee, all to the extent                     required by Law.
|----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

28

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|56.2. | The
internal controller shall file with the Board a proposal for an annual or
                    other periodic work plan, which shall be approved by the Board,
subject to any                     changes it deems appropriate.
|----- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|57. | Other
Officers of the Company
|--- | -----------------------------

| | The
Board may appoint, in addition to the General Manager and the internal controller, other
officers, define their positions and authorities, and set their compensation and terms of
employment. The Board may authorize the General Manager to exercise any or all of its
authorities stated in this Article.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|58. | The
Auditor
|--- | -----------

|58.1. | The
Shareholders at the Annual Meeting shall appoint an auditor for a period
                    until the close of the following Annual Meeting or for a period not
to extend                     beyond the close of the third Annual Meeting following the
Annual Meeting in                     which he was appointed. Subject to the provisions
of the Companies Law, the                     General Meeting is entitled at any time to
terminate the service of the auditor.
|----- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|58.2. | The
Board shall fix the compensation of the auditor of the Company for his
                    auditing activities, and shall also fix the compensation of the
auditor for                     additional services, if any, which are not auditing
activities, and, in each                     case, shall report thereon to the Annual
Meeting.
|----- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

# DISTRIBUTIONS

|59. | General
|--- | -------

| | The
Company may effect a distribution to its Shareholders to the extent permitted by the
Companies Law. Except as permitted by the Companies Law or Companies Regulations,
distribution shall not be made except from the profits of the Company legally available
therefor.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|60. | Dividend
and Bonus Shares
|--- | -------------------------

|60.1. | Right
to Dividend or Bonus Shares
|----- | ---------------------------------

| | 60.1.1. | A
Shareholder shall be entitled to receive dividends or bonus shares, upon the
               resolution of the Company in accordance with Article 60.2 below,
consistent with                the rights attached to the shares held by such
Shareholder.
| | ------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

29

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| | 60.1.2. | The
Shareholders entitled to receive dividends or bonus shares shall be those
               who are registered in the Shareholder Register on the date of the
resolution                approving the distribution or allotment, or on such later date,
as may be                determined in such resolution.
| | ------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|60.2. | Resolution
of the Company with Respect to a Dividend or Bonus Shares
|----- | --------------------------------------------------------------------

| | The
resolution of the Company with respect to the distribution of a dividend or bonus shares
shall be adopted by the General Meeting by an Ordinary Majority, after presentation of
the recommendation of the Board. The General Meeting may accept the Boards
recommendation or decrease the amount recommended, but may not increase it, provided in
each case the distribution is permitted in accordance with the provisions of the
Companies Law.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|60.3. | Specific
Dividend
|----- | -----------------

| | Upon
the recommendation of the Board approved by a resolution of the General Meeting adopted
by an Ordinary Majority, a dividend may be paid, in whole or in part, by the distribution
of specific assets of the Company or by distribution of paid up shares, debentures or
other securities of the Company or of any other companies, or in any combination thereof.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|60.4. | Deductions
from Dividends
|----- | -------------------------

| | The
Board may deduct from any distribution or other moneys payable to any Shareholder in
respect of a share any and all sums of money then payable by him to the Company on
account of calls or otherwise in respect of shares of the Company and/or on account of
any other matter or transaction whatsoever.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|60.5. | Retention
of Dividends
|----- | ----------------------

| | 60.5.1. | The
Board may retain any dividend, bonus shares or other moneys 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.
| | ------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 60.5.2. | The
Board may retain any dividend, bonus shares or other moneys payable or
               property distributable in respect of a share in respect of which any
person is,                under Article 20.5, 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.
| | ------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|60.6. | Mechanics
of Payment
|----- | --------------------

| | Any
dividend or other moneys payable in cash in respect of a share may be paid by check sent
by registered mail 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 as a result 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
direct in writing. 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.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

30

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|60.7. | An
Unclaimed Dividend
|----- | ---------------------

| | All
unclaimed dividends or other moneys payable in respect of a share may be invested or
otherwise made use of by the Board for the benefit of the Company until claimed. The
payment by the Board of any unclaimed dividend or such other moneys into a separate
account shall not constitute the Company a trustee in respect thereof, and any dividend
unclaimed after a period of seven (7) years from the date of declaration of such
dividend, and any such other moneys 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 may, at its discretion, cause the Company to pay any such dividend or such
other moneys, or any part thereof, to a person who would have been entitled thereto had
the same not reverted to the Company.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|60.8. | Receipt
from a Joint Holder
|----- | ---------------------------

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

|60.9. | Manner
of Capitalization of Profits and the Distribution of Bonus Shares
|----- | ------------------------------------------------------------------------

| | Upon
the recommendation of the Board approved by a resolution of the General Meeting adopted
by an Ordinary Majority, the Company may cause any moneys, investments, or other assets
forming part of the undivided profits of the Company, standing to the credit of a reserve
fund, or to the credit of a reserve fund for the redemption of capital, or in the hands
of the Company and available for distribution, or representing premiums received on the
issuance of shares and standing to the credit of the share premium account, to be
capitalized and distributed as capital among such of the Shareholders as would be
entitled to receive the same if distributed by way of dividend and in the same
proportion, or may cause any part of such capitalized fund to be applied on behalf of
such Shareholders in paying up in full, either at par or at such premium as the
resolution may provide, any unissued shares or debentures or other securities of the
Company which shall be distributed accordingly, in payment, in full or in part, of the
uncalled liability on any issued shares or debentures or other securities, and may cause
such distribution or payment to be accepted by such Shareholders in full satisfaction of
their interest in such capitalized sum.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|60.10. | The
Board may settle, as it deems fit, any difficulty arising with regard to the
                    distribution of bonus shares, distributions referred to in Articles
60.3 and                     60.9 hereof or otherwise, and in particular, to issue
certificates for fractions                     of shares and sell such fractions of
shares in order to pay their consideration                     to those entitled thereto,
to set the value for the distribution of certain                     assets and to
determine that cash payments shall be paid to the Shareholders on                     the
basis of such value, or that fractions whose value is less than NIS 0.01
                    shall not be taken into account. The Board may pay cash or convey
these certain                     assets to a trustee in favor of those people who are
entitled to a dividend or                     to a capitalized fund, as the Board shall
deem appropriate.
|------ | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

31

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|60.11. | The
provisions of this chapter shall also apply to the distribution of
                    Securities.
|------ | ------------------------------------------------------------------------------------------------------

|61. | Acquisition
of Shares
|--- | ---------------------

|61.1. | The
Company is entitled to acquire or to finance an acquisition, directly or
                    indirectly, of shares of the Company or securities convertible or
exercisable                     into shares of the Company, including incurring an
obligation to take any of                     these actions, subject to the fulfillment
of the conditions of a permitted                     distribution under the Companies
Law. In the event that the Company so acquired                     any of its shares, any
such share shall become a dormant share, and shall not                     confer any
rights, so long as it held by the Company.
|----- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|61.2. | A
subsidiary or another company controlled by the Company is entitled to acquire
                    or finance an acquisition, directly or indirectly, of shares of the
Company or                     securities convertible or exercisable into shares of the
Company, or incur an                     obligation with respect thereto, to the same
extent that the Company may make a                     distribution, subject to the terms
of, and in accordance with the Companies Law.                     In the event a
subsidiary or such controlled company so acquired any of the                     Companys
shares, any such share shall not confer any voting rights, so                     long as
it is held by such subsidiary or controlled company.
|----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

# INSURANCE,
INDEMNIFICATION AND RELEASE OF OFFICE HOLDERS

|62. | Definition
|--- | ----------

| | For
purposes of Articles 63, 64 and 65 below, the term Office Holder shall have
the meaning ascribed to such term in the Companies Law.
| | -----------------------------------------------------------------------------------------------------------------------------------------

|63. | Insurance
of Office Holders
|--- | ---------------------------

|63.1. | The
Company may, to the extent permitted by the Companies Law, enter into a
                    contract for the insurance of the liability of an Office Holder of
the Company,                     in respect of a liability imposed on him as a result of
an act done by him in                     his capacity as an Office Holder of the
Company, in any of the following:
|----- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 63.1.1. | a
breach of his duty of care to the Company or to another person;
| | ------- | -----------------------------------------------------------------

| | 63.1.2. | a
breach of his duty of loyalty to the Company, provided that the Office Holder
                    acted in good faith and had reasonable grounds to assume that such
act would not                     harm the Company;
| | ------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

32

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| | 63.1.3. | a
financial liability imposed on him in favor of another person.
| | ------- | ----------------------------------------------------------------

|64. | Indemnification
of Office Holders
|--- | ---------------------------------

|64.1. | The
Company may, to the extent permitted by the Companies Law, indemnify an
                    Office Holder of the Company for liability or expense he or she
incurs as a                     result of an act done by him or her in his or her
capacity as an Office Holder                     of the Company, as follows:
|----- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 64.1.1. | a
financial liability imposed on him or her in favor of another person by a
                    court judgment, including a settlement, judgment or an arbitrators
award                     approved by a court;
| | ------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 64.1.2. | reasonable
costs of litigation, including attorneys fees, expended by an
                    Office Holder as a result of an investigation or proceeding
instituted against                     the Office Holder by a competent authority,
provided that such investigation or                     proceeding was concluded without
the filing of an indictment against the Office                     Holder or the
imposition of any financial liability in lieu of criminal
                    proceedings, or was concluded without the filing of an indictment
against the                     Office Holder and a financial liability was imposed on
the Office Holder in lieu                     of criminal proceedings with respect to a
criminal offense in which proof of                     criminal intent is not required;
| | ------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 64.1.3. | reasonable
litigation expenses, including attorneys fees, expended by an
                    Office Holder or charged to him or her by a court, in a proceeding
filed against                     him or her by the Company or on its behalf or by
another person, or in a                     criminal charge from which he or she was
acquitted, or in a criminal charge of                     which he was convicted of a
crime which does not require a finding of criminal                     intent
| | ------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|64.2. | The
Company may indemnify an Office Holder of the Company pursuant to this
                    Article 64 retrospectively, and may also undertake in advance to
indemnify an                     Office Holder of the Company, provided the undertaking
is limited to events                     which the Board believes can be anticipated at
the time of such undertaking, in                     light of the Companys
activities as conducted at such time and is in an                     amount or based on
criteria that the Board determines is reasonable under the
                    circumstances and, provided, further, that such undertaking lists the
events                     which the Board believes can be anticipated in light of the
Companys                     activities as conducted at such time, and the amount
or based on criteria that                     the Board determines is reasonable under
the circumstances..
|----- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|65. | Release
of Office Holders
|--- | -------------------------

| | The
Company may, to the extent permitted by the Companies Law, release an Office Holder of the
Company, in advance, from his liability, in whole or in part, for damages resulting from
the breach of his duty of care to the Company.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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|66. | General
|--- | -------

| | The
provisions of Articles 63, 64 and 65 above are not intended, and shall not be
interpreted, to restrict the Company in any manner in respect of the procurement of
insurance and/or in respect of indemnification and/or release from liability in
connection with any person who is not an Office Holder, including, without limitation,
any employee, agent, consultant or contractor of the Company who is not an Office Holder,
or  in connection with any Office Holder to the extent that such insurance and/or
indemnification and/or release from liability is permitted under the Law.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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# LIQUIDATION

|67. | Liquidation
|--- | -----------

|67.1. | In
the event that the Company is liquidated, whether voluntarily or otherwise,
                    the liquidator, with the approval of a General Meeting, may make a
distribution                     in kind to the Shareholders of all or part of the
property of the Company, and                     he may, with the approval of the General
Meeting, deposit any part of the                     property of the Company with
trustees in favor of the Shareholders, as the                     liquidator with the
aforementioned approval, deems appropriate.
|----- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|67.2. | Subject
to applicable Law and to the rights of shares with special rights upon
                    liquidation, the assets of the Company available for distribution
among the                     Shareholders shall be distributed to them in proportion to
the amount paid or                     credited as paid on the par value of their
respective holdings of the shares in                     respect of which such
distribution is being made.
|----- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

# ACCOUNTS

|68. | Books
of Account
|--- | ----------------

| | The
Board 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 may
deem 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 or by a resolution of the General Meeting adopted by an Ordinary Majority.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|69. | Audit
|--- | -----

| | Without
derogating from the requirements of any applicable Law, at least once in every fiscal year
the accounts of the Company shall be audited and the accuracy of the profit and loss
account and balance sheet certified by one or more duly qualified auditors.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

# RIGHTS OF SIGNATURE,
STAMP AND SEAL

|70. | Rights
of Signature, Stamp and Seal
|--- | -----------------------------------

|70.1. | The
Board 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 shall bind the
Company insofar as                     such person(s) acted and signed within the scope
of his or their authority.
|----- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|70.2. | The
Company shall have at least one official stamp.
|----- | ---------------------------------------------------

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|70.3. | The
Board may provide for a seal. If the Board so provides, it shall also
                    provide for the safe custody thereof. Such seal shall not be used
except by the                     authority of the Board and in the presence of the
person(s) authorized to sign                     on behalf of the Company, who shall sign
every instrument to which such seal is                     affixed.
|----- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

# NOTICES

|71. | Notices
|--- | -------

|71.1. | Any
written notice or other document may be served by the Company upon any
                    Shareholder either personally or by sending it by prepaid registered
mail                     (airmail if sent to a place outside Israel) addressed to such
Shareholder at his                     address as described in the Shareholder Register
or such other address as he 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 corporate secretary or the
                    General Manager 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 office. Any such
notice or other document shall be                     deemed to have been served two (2)
Business Days after it has been posted (seven                     (7) Business Days if
sent internationally), or when actually received by the                     addressee if
sooner than two days or seven days, as the case may be, after it                     has
been posted, or when actually tendered in person, to such Shareholder (or to
                    the corporate secretary or the General Manager), provided, however,
that notice                     may be sent by cablegram, telex, 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 cablegram, telex, 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 71.1. Unless otherwise                     provided in these
Articles, the provisions of this Article 71.1 shall also apply                     to
written notices permitted or required to be given by the Company to any
                    Director or by any Director to the Company.
|----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|71.2. | All
notices to be given to the Shareholders shall, with respect to any share
                    held by persons jointly, be given to whichever of such persons is
named first in                     the Shareholder Register, and any notice so given
shall be sufficient notice to                     the holders of such share.
|----- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|71.3. | Any
Shareholder whose address is not described in the Shareholder 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.
|----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|71.4. | Any
Shareholder and any Director may waive his right to receive notices
                    generally or during a specific time period and he may consent that a
General                     Meeting of the Company or a meeting of the Board, as the case
may be, shall be                     convened and held notwithstanding the fact that he
did not receive a notice with                     respect thereto, or notwithstanding the
fact that the notice was not received by                     him within the required
time, in each case subject to the provisions of any Law                     prohibiting
any such waiver or consent.
|----- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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