Arel Learning Solutions Selects Larry Harms to Head Unit Providing Interactive Distance Learning to Government and Education Clients

June 1, 2001

Arel Learning Solutions Inc, the world’s leading provider of corporate training solutions today announced that Larry Harms has agreed to join the company as Executive Vice President and to head its Public Sector Division.

Harms held several senior-level positions with MTC International of Dayton, including its Modern Technologies Corporation unit where he was Vice President for Information Technology and Business Development. He was also responsible for the successful launch of an environmental consulting division and two information technology companies – Corbus, which provides custom software development services and IT Wings, an information technology incubator. Harms served as President of Corbus and Director of IT Wings. He also served as CTO of Tutor Link, an education-based company under IT Wings. Prior to joining MTC, Larry was a career Air Force officer. His service included program management responsibility on weapon systems such as the Low Altitude Navigation and Targeting Infrared for Night (LANTIRN) system, B-1 bomber and Advanced Cruise Missile. He holds a BS in Business Administration and an MS in Systems Management.

“Interactive technology-based learning holds tremendous potential for the government and education sectors, as well as for business,” said Harms. “The public sector needs to balance limited dollars with the growing demand for high quality learning. Arel is in an ideal position to help these clients achieve superior results – cost-effectively using distance learning.”

Harms is assuming responsibility for both sales and project management. “From consultative selling to hands-on management, Arel’s emphasis upon close client support is just what the market needs,” said Harms.

Brad Schulte, President of Arel Learning Solutions, commented that, “Our plan is to increase our capabilities to serve the public sector. Larry has outstanding experience that will enable us to bring the benefits of distance learning to governmental bodies at all levels as well as to educational institutions.”

About Arel Communications and Software, Ltd.

Arel Communications and Software, Ltd., Yavne, Israel and its U.S.- based subsidiaries, Arel Communications and Software, Inc. and Arel Learning Solutions Inc., ( market the IDEAL complete family of interactive distance learning and e-Training solutions. Arel IDEAL is the most advanced live and on-demand suite of e-Learning solutions available today, incorporating the latest Web technologies and many years of diligent research and development.

Arel has extensive experience in installing and supporting global IDL networks for many of the world’s largest multinational concerns in the telecommunications, financial services, automotive, retail, healthcare, manufacturing, and academic sectors. Equipped with the technology to offer unique business benefits, such as cost-effectiveness, certified results and just-in-time knowledge transfer, Arel solutions improve enterprise productivity, time-to-market, customer satisfaction and profitability.

Arel IDEALhas, Arel Spotlighthas, Arel Spotlight On-Demandhas, Arel Vision Arel Learning Manager, Arel Evaluator and Arel Campushas are trademarks of Arel Communications and Software. All other trade names are the properties of their respective owners.

Certain statements made herein that are not historical are forward-looking within the meaning of the Private Securities Litigation Reform Act of 1995. The words “estimate,” “project,” “intend,” “expect,” “believe,” “hopeful,” and similar expressions are intended to identify forward-looking statements. These forward-looking statements involve known unknown risks and uncertainties. Many factors could cause the actual results, performance or achievements or the Company to be materially different from any future results, performance or achievements that may be expressed or implied by such forward-looking statements, including, among others, changes in general economic and business conditions, inability to maintain market acceptance to the Company’s products, inability to timely develop and introduce new technologies, products and applications, rapid changes in the market for the Company’s products, loss of market share and pressure on prices resulting from competition, introduction of competing products by other companies, inability to manage growth and expansion, loss of key partners, inability to attract and retain qualified personnel, inability to protect the Company’s proprietary technology and risks associated with the Company’s international operations and its location in Israel. For additional information regarding these and other risks and uncertainties associated with the Company’s business, reference is made to the Company’s reports filed from time to time with the Securities and Exchange Commission.