TASE Trading Guide. Regulations to The Third Part of the Rules

Transcription

1 TASE Tradng Gude Regulatons to The Thrd Part of the Rules Ths s not an offcal translaton and has no bndng force. Whlst reasonable care and skll have been exercsed n the preparaton hereof, no translaton can ever perfectly reflect the orgnal. In the event of any dscrepancy between the orgnal Hebrew and ths translaton, the Hebrew alone wll preval. The reader s therefore warned to take proper professonal advce before actng further hereto, as nether The Tel-Avv Stock Exchange Ltd. nor the translators assume any lablty for accuracy hereof.

2 2 TABLE OF CONTENTS REGULATIONS Chapter 1: Chapter 2: Chapter 3: Chapter 4: Chapter 5: Chapter 6: Chapter 7: Chapter 8: Chapter 9: Chapter 10: Chapter 11: Chapter 12: Chapter 13: TRADING HOURS THE TRADING UNIT OF A SECURITY CALCULATION OF PRICES PRICE FLUCTUATIONS TRADING IN SECURITIES, EXCLUSIVE OF DERIVATIVES TRADING IN DERIVATIVES SHORT SALES CONDITIONS AND PROCEDURES FOR MEMBERS' OFF-EXCHANGE TRANSACTIONS TEMPORARY HALT IN TRADING PUBLICATION OF TRADING DATA CANCELLATION OF TRANSACTIONS, DUE TO TECHNICAL MALFUNCTION OR TECHNICAL ERROR MARKET MAKERS INSTITUTIONAL SECURITIES

3 3 1. TRADING SCHEDULE CHAPTER ONE: TRADING HOURS The schedule for tradng shall be as follows : A. For shares and securtes convertble nto shares: 1) The pre-openng phase shall begn at a tme to be set by the Board of Drectors between 8 AM and 9 AM, and t shall end for each securty when ts openng tradng phase begns. 2) The openng tradng phase shall begn at a tme to be set by the Board of Drectors between 9:30 AM and 12:00 AM; the Board of Drectors may set dfferent tmes for dfferent securtes. Notwthstandng the aforesad, n the event of a sharp fluctuaton n the theoretcal TA-25 ndex, whch shall be calculated mmedately before openng tradng n the frst securty for whch openng tradng s held on that tradng day (hereafter: "the last theoretcal TA-25 ndex"), or f the rate of change n the last theoretcal prce of a share ncluded n the TA-25 ndex s hgher than the statc threshold, wthn ts meanng n Chapter Fve of the Regulatons to the Thrd Part of the Rules, the openng tradng phase shall be postponed, as specfed n Chapter Fve of the Regulatons to the thrd part of the rules. The openng tradng phase for each securty shall end when ts openng prce s determned. 3) The contnuous tradng phase for each of the securtes shall begn when the openng prce for that securty has been determned, and t shall end at the begnnng of ts pre close phase. 4) The pre close phase shall begn at the tme that the Board of Drectors shall set, whch shall be between 3 PM and 6:10 PM, and whch shall end for each securty at the begnnng of ts closng tradng phase. Notwthstandng the aforesad, n respect of a securty ncluded n the llqud lst, wthn ts meanng n Chapter Fve below, and n respect of a securty ncluded n the mantenance lst, wthn ts meanng n subsecton 1. In Chapter four of the Regulatons, the pre-closng tradng phase of the securty shall begn when ts openng prce s set, and t shall end at the begnnng of ts closng tradng phase. 5) The closng tradng phase shall begn at the tme to be set by the Board of Drectors, whch shall be between 3:10 PM and 6:10 PM. The closng tradng phase of each securty shall end when ts closng prce s determned The Decsons of the Board of Drectors on the schedule for tradng are specfed n the Chapter "Decsons of the Board of Drectors" n ths gudebook.

4 4 B. In respect of bonds, bond opton certfcates. M.K.M., commercal securtes and nsttutonal securtes 1) The pre-openng phase shall begn at a tme to be set by the Board of Drectors, whch shall be between 8 AM and 10 AM, and whch shall end for each securty when ts openng tradng phase begns. 2) The openng tradng phase shall begn at a tme to be set by the Board of Drectors between 9:30 AM and 11:30 AM and t shall end for each securty when ts openng prce s determned. 3) The contnuous tradng phase for each of the securtes shall begn when the openng prce for that securty has been determned, and t shall end at the begnnng of ts pre-closng phase. 4) The pre-closng phase shall begn for each securty shall begn at a tme to be set by the Board of Drectors, whch shall be between 3 PM and 6:10 PM, and whch shall end for each securty when ts closng tradng phase begns. 5) The closng tradng phase shall begn at a tme to be set by the Board of Drectors, whch shall be between 3:10 PM and 6:10 PM. The closng tradng phase for each securty shall end when ts closng prce has been determned. C. For dervatves: Tradng shall begn at a tme to be set by the Board of Drectors, whch shall be between 9 AM and 10 AM and t shall end at a tme to be set by the Board of Drectors between 4 PM and 6:30 PM D. Tradng hours n Passover and Sukkot: 1) In respect of shares and securtes convertble nto shares the contnuous tradng phase shall end and the pre-closng phase shall begn at a tme to be set by the Board of Drectors, whch shall be between 1:30 PM and 2:30 PM, and closng tradng phase shall begn at a tme to be set by the Board of Drectors, whch shall be between 1:40 PM and 2:45 PM; 2) In respect of bonds, bond opton certfcates, M.K.M., commercal securtes and nsttutonal securtes the contnuous tradng phase shall end and the preclosng phase shall begn at a tme to be set by the Board of Drectors, whch shall be between 1:20 and 2:20 PM, and the closng tradng phase shall begn at a tme to be set by the Board of Drectors, whch shall be between 1:40 and 2:45 PM 3) Tradng n dervatves shall end at a tme to be set by the Board of Drectors, whch shall be between 1:45 and 2:45 PM.

5 5 2. A. Notwthstandng the provsons of the above secton 1, when one of the events specfed below occurs the General Manager of the Stock Exchange or a person authorzed by hm may prescrbe schedules that dffer from the schedules sad n secton 1, and that ether n respect of a sngle securty or n respect of a group of securtes: 1) There was or there s expected to be a large volume of tradng n a securty. 2) An error occurred, ether on the part of a member or on the part of the Stock Exchange, n the transmsson of orders to the Stock Exchange or n ther recepton there. 3) A fault occurred n communcatons between a member and the Stock Exchange, n consequence of whch an order or group of orders was not receved. 4) A fault occurred n consequence of whch an error may occur n tradng. 5) A substantve event occurred, n consequence of whch the openng of tradng was postponed or tradng was nterrupted. 6) An event occurred, n consequence of whch t s feared that t wll not be possble to conduct tradng accordng to the schedule sad n secton 1. 7) An event s expected to occur, n consequence of whch t s feared that t wll not be possble to conduct tradng accordng to the schedule sad n secton 1. B. 1) If, n accordance wth subsecton A. above, a tmetable dfferent from that set n secton 1 s determned for a sngle securty, then trade n t shall end no later than at the tme set therefore n secton 1 above. 2) If, n accordance wth subsecton A., a tmetable dfferent from that set n secton 1 s determned for a group of securtes, then tradng n them shall end no later than at 7:00 PM. C. If a schedule dfferent from that prescrbed n secton 1 has been determned under the above subsecton a., notce thereof shall be gven to the Stock Exchange members. 3. If tradng was halted by a fluctuaton of 8% n the TA-25 ndex, then the Managng Drector of the Exchange may change the tmetable and extend the tme for tradng. 4. Repealed 5. Frst tradng day n securtes The Stock Exchange shall publsh a notce about the frst tradng day n a securty untl 2:30 PM of any day that s a tradng day. When a sad notce has been publshed, the frst tradng day of that securty shall be on the next tradng day after the tradng day on wth the notce by the Stock Exchange was publshed.

6 6. Last tradng day n securtes B - 6 The last tradng day for the followng securtes shall take place at the tme specfed below: A. Convertble securtes 1. Opton certfcates - three tradng days before the last day of exercsng. 2. Convertble bonds and opton warrant certfcates three tradng days before the last day of exercsng or a day before the exercse date, respectvely. 3. Notwthstandng the aforesad, f - on the last tradng day of an opton certfcate, convertble bonds or opton warrant certfcates - there was a temporary halt n tradng the securty whch contnued more than 45 mnutes and at the end of whch tradng n the securty was not resumed on that tradng day, then the last tradng day of that securty shall be postponed to the next tradng day. A notce shall be publshed about the postponement of the last tradng day. 4. If the last tradng day was postponed as sad n subsecton 3. above and f on the next tradng day there agan s a temporary halt n tradng the securty and t lasts longer than 45 mnutes, and f after t ended tradng n that securty was not resumed on that tradng day, the last tradng day shall not agan be postponed. B. Corporate Bonds 1. Three tradng days before the orgnal day of redempton. 2. Notwthstandng the provsons of subsecton 1. Above, for corporate bonds on whch apply the tax laws of the Unted States ffteen days before the orgnal day of redempton. However, f ths day s not a tradng day, t's the prevous tradng day. 3. Notwthstandng the provsons of subsecton 1. above, f the prospectus of a corporate debenture prescrbed a record date for enttlement to fnal redempton, then the last tradng day shall be as sad n subsecton 1. above or three tradng days before the record date for enttlement to fnal redempton, whchever s earler. C. Government Bonds 1. If the regulatons, accordng to whch a Government bond was ssued, do not set a record date for enttlement to fnal redempton three tradng days before the day of redempton. 2. If the regulatons, accordng to whch a Government bond was ssued, do set a record date for enttlement to fnal redempton three tradng days before the record date for enttlement to redempton. D. M.K.M. three tradng days before the day of redempton.

7 E. Commercal securtes - three tradng days before the day of redempton. B - 7 F. ETN's 1) Index certfcates, currency certfcates, merchandse certfcates and complex certfcates a. ffteen days before the day of redempton; however, f that s not a tradng day the tradng day that precedes t. b. notwthstandng the provsons of subsecton a) above, f a record date for redempton was set for a basket certfcate, then the last tradng day shall be as sad n subsecton a) above or three tradng days before the date set for redempton whchever s earler. 2) Reverse certfcates three tradng days before the record date for redempton. 3) Covered warrants the tradng day before the day of expraton. 7. Tradng not held because of a company event A. 1) There shall be no tradng n a company's shares and securtes convertble nto shares on the Ex-date because of one of the company events specfed below (hereafter n ths secton: "company event"), provded that the Ex-date does not come after the determnng date and that one or more of the condtons specfed n subsecton 2) below apples: A rghts offerng; A dvdend dstrbuton n cash; A dvdend dstrbuton n knd; A company splt; 2) And these are the condtons: a) Adjustments that because of the company event must be made n the condtons for the converson of convertble securtes nto the company's shares are based on the closng prce of the company's share on the record date. b) The company has securtes convertble nto shares, whch are lsted for tradng, and accordng to ther condtons there s nothng that s due to each of the company events that prevents ther converson on the ex-date. c) To the extent that the case s one of a dvdend n cash, of a dvdend n knd or of a company splt the company has securtes convertble nto shares that are not lsted for tradng and accordng to ther condtons there s nothng that s due to the company event that prevents ther converson on the ex-date, and the company announced the dstrbuton of a dvdend n cash, of a dvdend n knd or of a company splt n a fxed total amount or for a fxed total number of shares, as the case may be.

8 8 3) a) If tradng dd not take place because of a company event, as sad n the above secton 7.a.1), the ex-day shall be postponed to the next tradng day sad n secton 7. Ths shall not apply agan on the postponed ex day. b) The provsons of the above subsecton 3)a) shall also apply f tradng n shares was suspended on the determnng day because of any other reason whatsoever. B. 1) Tradng n a company's shares and securtes convertble nto shares shall not be held on the ex-day, due to any one of the company events that are specfed below, on condton that the ex-day does not come after the determnng day: Unfcaton of captal; - Reducton of captal. 2) a) If tradng dd not take place because of a company event, as sad n the above secton 7.b.1), the ex-day shall be postponed to the next tradng day sad n secton 7. Ths shall not apply agan on the postponed ex day. b) The provsons of the above subsecton 2)a) shall also apply f tradng n shares was suspended on the determnng day because of any other reason whatsoever. c) Tradng n a company's securtes that are convertble nto shares shall not take place on the ex-day, because of any one of the company events specfed below, provded that the ex-day does not come after the determnng day, f the company has securtes convertble nto shares that are lsted for tradng and accordng to ther condtons there s nothng to prevent ther converson on the ex-day: A bonus share dstrbuton; A share splt; A unfcaton of categores of shares.

9 9 CHAPTER TWO: THE TRADING UNIT OF A SECURITY 1. In the followng nstances, the tradng unt shall be as specfed below: A. Cancelled. B. For bonds -1 NIS nomnal value, 1 US$ nomnal value or Euro 1 nomnal value, as the case may be. C. For opton certfcates that can be exercsed n shares or n opton certfcates - the tradng unt s a quantty of opton certfcates whch, f exercsed on the day of ther regstraton for tradng, would gve the rght to acqure one tradng unt of shares or of opton certfcates, as the case may be. D. For opton certfcates that can be exercsed n bonds or n convertble bonds - the tradng unt s a quantty of opton certfcates whch, f exercsed on the day of ther regstraton for tradng, would gve one hundred tradng unts of bonds. E. For opton certfcates that can be exercsed n more than one securty - the tradng unt s a quantty of opton certfcates, whch, f exercsed on the day of ther regstraton for tradng, would gve the rght to acqure one tradng unt of shares, or - f there s no exercse n shares - ts exercse on the day of ther regstraton for tradng would gve the rght to acqure one hundred tradng unts of bonds or of convertble bonds, or of the opton certfcate, as the case may be. F. For rghts - the tradng unt s one rght unt as appear n the ssue's prospectus. G. For dervatves - the tradng unt shall be one opton or one future, as the case may be. H. For Covered Warrants - the tradng unt shall be one covered warrant. I. For Hybrd Bonds the tradng unt shall be 50,000 NIS nomnal value. Hybrd Bonds Bonds ssued by a bankng corporaton or an nsurer can be converted nto a forced, whch was lsted to trade under Chapter twenty-two accordng to the second part of the rules. 2. Fractonal tradng Once a year, on the 25 th of December, and f that day s not a tradng day, on the tradng day thereafter, tradng shall be conducted n quanttes smaller than a tradng unt ("fractons"). The fractonal tradng shall be conducted by acceptng the member's wrtten orders, carryng them out at the closng prces of the prevous tradng day to the fractonal tradng day, and transferrng the balance to the credt or debt of the coordnatng bank. The member's orders as sad wll be receved untl December 24th by the stock exchange.

10 10 CHAPTER THREE: CALCULATION OF PRICES 1. The base prce for tradng any securty shall be the prce determned on the precedng tradng day as the closng prce, subject to the followng provsons: A. If a securty - other than the securty of a foregn company, as defned n the Stock Exchange Regulatons (Part Two) - was lsted for tradng for the frst tme, otherwse than as the result of swtchng securtes or as a result of a merger or splt of a lsted company, then no base prce shall be set on the frst tradng day; however, the contnuous tradng system shall - for operatonal purposes of tradng only - use an openng parameter, as specfed below: 1) For securtes other than dervatves - 1; 2) For dervatves - no openng parameter shall be determned and t shall be stated that the prce "has not yet been establshed". 3) For the securtes of a company lsted on a foregn Stock Exchange the last prce set for that securty on the foregn Stock Exchange, multpled by the known representatve exchange rate (n agorot) of the currency n whch tradng n conducted on the foregn Stock Exchange. B. The base prce of a securty of a company, of whch ts two knd of securtes that are lsted for tradng were combned nto one securty, shall be calculated as the weghted average of the closng prces of the securtes that were combned, accordng to the rato of each of the combned securtes to the company's captal, n accordance wth the number of shares of each of the combned securtes on the tradng day that precedes the day on whch they were combned. C. 1) The base prce on the frst tradng day of a securty s frst regstered for tradng as part of a merger process or of a spn-off process of a regstered company, shall be calculated n accordance wth the provsons of the Appendx to the Regulatons on Base Prces. 2) (a) The base prce of securty on the Ex-day shall be calculated n accordance wth the provsons of the Appendx to the Regulatons on Base Prces. (b) The base prce of a bond or a convertble bond on the Ex-day shall not be calculated n accordance wth subsecton 2) (a) above, f the tradng suspended because the company apponted a provsonal lqudator, a temporary recever or a recever. If the Stock Exchange has been notfed that the payment sn't accordng to the orgnal terms of the bond or the convertble bond, the base prce shall be calculated n accordance wth subsecton 2) (a) above. D. 1) The base prce of a securty, n whch tradng was renewed after t had been halted for not longer than three months shall be the last closng prce set for that securty.

11 11 2) In respect of a securty n whch tradng was renewed after t had been halted for longer than three months, no base prce shall be set; however, for the operatonal requrements of tradng alone, the TACT system shall use an openng parameter, as specfed for a securty when t s frst regstered for tradng otherwse than as the result of a merger process or of a spn-off process. E. In respect of the securty of a foregn company, as defned n the Stock Exchange Regulatons (Part Two), whch s lsted for tradng for the frst tme, the base prce for tradng shall be the last prce set for that securty on an Exchange abroad, multpled by the known representatve exchange rate (n agorot) of the tradng currency of the Exchange abroad. F. The base prce of a securty that was lsted for tradng for the frst tme, and replace, not as part of a merger proceedng lsted securtes ("Replaced securty") shall be equal to the closng prce of the replaced securty exchanged on the tradng day precedng the frst day of tradng of the securty for replacement. Purposes of ths secton "securty for replacement" means - a securty that all ts characterstcs are dentcal to those of the replaced securty. 2. Notwthstandng the provsons of secton 1 above, the base prce of a securty, other than a dervatve, shall not be less than one Agora per tradng unt. 3. The base prce of a securty shall be rounded off to the nearest level for the submsson of an order. 3A. A. 1) When the closng phase s concluded for a securty, the Stock Exchange shall calculate and publsh the closng prce for each securty separately, as specfed n subsecton B. below. 2) Closng prces shall be calculated one after the other for all the securtes; the order of the securtes, for calculaton of the closng prces, shall be random and t shall change every day. B. The closng prce shall be calculated as follows: 1) If the amount of transactons n the closng tradng phase reached an amount that the Board of Drectors wll prescrbe, then the closng tradng prce shall be the closng prce. The Board of Drectors may set dfferent amounts for dfferent categores or dfferent groups of securtes. 2) If the amount of transactons n the closng tradng phase dd not reach the amount determned under subsecton 3A.B.1) above, then the closng prce The Board of Drectors decded that the amount of transactons n the closng tradng phase, by categores of securtes, shall be as follows: a) for shares ncluded n the Tel Avv 25 ndex NIS 400,000; b) for shares ncluded n the Tel Avv 75 ndex NIS 200,000; c) for other shares and securtes convertble nto shares NIS 100,000; d) for bonds, bond optons, M.K.M. and commercal paper NIS 400,000

12 12 shall be calculated accordng to the weghted average of the prces of the transactons carred out n the closng tradng phase, together wth the transactons carred out wth the securty durng the last ten mnutes of the contnuous tradng phase. If the last transacton that was ncluded n the calculaton of the aforesad closng prce was a transacton that was carred out n the prce montorng aucton, wthn the meanng thereof n Chapter Fve of the Regulatons to the Thrd Part of the Rules (hereafter: "Prce Montorng aucton"), then for purposes of the calculaton only a proportonal part of the transacton shall be taken nto account, so that the cumulatve amount of transactons wll be equal to the amount prescrbed under the subsecton 3A.B.1 above). 3) If the amount of transactons n the closng tradng phase, together wth the transactons carred out wth the securty durng the last ten mnutes of the contnuous tradng phase, dd not reach the amount set under subsecton 3A.B.1) above, then the closng prce shall be calculated accordng to the weghted average of the prces of the transactons carred out n the closng tradng phase, together wth the last transactons carred out wth the securty durng the contnuous tradng phase, untl ther cumulatve amount reaches the amount set under subsecton 3A.B.1) above. For ths purpose, f, after the last transacton ncluded n the calculaton of the closng prce the amount of the sad transactons s greater than the amount specfed above, then the last transacton shall be ncluded n the calculaton of the closng prce. If the last transacton that was ncluded n the aforesad calculaton was a transacton that was carred out n prce montorng aucton, then for purposes of the calculaton only a proportonal part of the last transacton shall be taken nto account, so that the cumulatve amount of transactons wll be equal to the amount prescrbed under the subsecton 3A.B.1 above). 4) However, f the amount of transactons n the closng tradng phase, together wth the transactons carred out wth the securty durng the last thrty mnutes of the contnuous tradng phase, dd not reach the amount set under subsecton 3A.B.1) above, then the closng prce shall be calculated accordng to the weghted average of the prces of the transactons carred out n the closng tradng phase, together wth the transactons carred out wth the securty durng the last thrty mnutes of the contnuous tradng phase and together wth the last transactons carred out wth the securty before the sad thrty mnutes, n a quantty equal to the mnmum for calculaton of the closng prce. The mnmum quantty for calculaton of the closng prce s as follows: a) 1 In respect of shares, convertble bonds and opton bonds a quantty of securtes wth a monetary value to be set by the Board of Drectors, whch shall be between NIS 20,000 and NIS 50,000; 1 The Board of Drectors decded that the value of shares, convertble bonds and opton bonds, for the purpose of mnmum quantty for calculaton of the closng prce shall be 30,000 NIS.

13 13 b) In respect of convertble securtes not sad n subsecton 3A.B.4)a) above or n subsecton 3A.B.4)d) below - a quantty of convertble securtes equal to the mnmum quantty for calculaton of the closng prce of the convertble securty's underlyng asset, dvded by the exercse rato of the convertble securty; If the convertble securty can be converted nto more than one other securty, then the calculaton shall be made separately n respect of each of the securtes that arse out of ts converson and the largest of the amounts obtaned shall be the mnmum quantty for calculaton of the closng prce; c) In respect of rghts to shares and rghts to shares and convertble securtes the quantty of tradng unts equal to the mnmum quantty for calculaton of the closng prce; In respect of rghts to convertble securtes alone - the quantty of tradng unts equal to the mnmum quantty for calculaton of the closng prce of that convertble securty, of whch the largest quantty was offered n the ssue unt; d) In respect of bonds, bond optons, M.K.M. and commercal paper a quantty equal to the mnmum quantty for a securtes order. e) Notwthstandng the provsons of subsecton 3A.B.4)a) above, n the cases specfed below the mnmum quantty for calculaton of the closng prce shall be 1,500 tradng unts: - On the frst tradng day of a new securty and on each tradng day thereafter, up to and ncludng the tradng day on whch tradng n the securty frst takes place on the Stock Exchange; - On the frst tradng day of a securty, after tradng n t was halted for longer than three months, and on each tradng day thereafter, up to and ncludng the tradng day on whch tradng n the securty frst takes place on the Stock Exchange after the tradng halt. The provsons of ths subsecton shall not apply to hybrd bonds, as defned n subsecton 1.I of chapter 2 above. f) (1) The mnmum quantty for calculaton of a closng prce shall be calculated every month, on the last tradng day of the month, and t shall reman n effect durng the entre month, subject to the provsons of secton 3A.B.1)(2) below; (2) On the ex-day for rghts for adjustment the quantty of securtes shall be adjusted by the rghts dstrbuted accordng to the basc prce of the securty on that day; For ths purpose, f the last transacton ncluded n the calculaton of the closng prce was carred out durng the contnuous tradng phase, and f after the transacton was added the number of securtes n sad transactons exceeds the mnmum quantty for

14 14 calculatng the closng prce of the securty, then the last transacton n ts entrety shall be ncluded n the calculaton; If the last transacton ncluded n the calculaton of the closng prce was carred out durng the openng tradng phase or n the prce montorng aucton, then only the proportonal part of the sad last transacton shall be taken nto account for the calculaton, so that the quantty of securtes n the transactons wll equal the mnmum quantty for calculatng the closng prce of the securty; If the quantty of securtes n the transactons carred out before the sad thrty mnutes does not reach the mnmum quantty for calculatng the closng prce of the securty, then the closng prce shall be calculated accordng to the weghted average of the prces of all the transactons carred out on that day; 5) If no transactons were carred out durng the closng tradng phase and durng the contnuous tradng phase, then the closng prce shall be set at the openng prce of the securty on that tradng day; 6) If contnuous tradng was resumed after tradng n the securty was halted, then the sad closng prce shall be set as follows: a) If more than thrty mnutes are left untl the end of the contnuous tradng phase for the securty, then the closng prce shall be set as specfed n subsecton 3A.B.1) to 3A.B.4) above, as the case may be, but n no case shall transactons carred out before the addtonal openng phase be ncluded n the calculaton. b) If thrty mnutes or less are left untl the end of the contnuous tradng phase for the securty, then the closng prce shall be set as specfed n subsecton 3A.B.1) to 3A.B.3) above, as the case may be; for ths purpose, transactons carred out after the addtonal openng phase shall be ncluded n the calculaton. If the sad amount of the transactons does not reach the amount prescrbed under subsecton 3A.B.1) above, then the closng prce shall be calculated accordng to the weghted average of prces n the transactons carred out wth the securty n the closng tradng phase, together wth the transactons carred out wth the securty n the contnuous tradng phase after the addtonal openng phase, and together wth the transactons carred out durng the addtonal openng phase, or part of the transactons carred out durng the addtonal openng phase, untl ts cumulatve amount equals the amount prescrbed under subsecton 3A.B.1); c) If no transactons were carred out n the closng tradng phase and n the contnuous tradng phase after the addtonal openng phase, then the closng prce shall be set at the addtonal openng prce of the securty on that tradng day; d) If tradng n the securty was resumed durng the pre-closng phase, then the closng prce shall be set at the closng tradng prce.

15 15 7) If tradng n a securty was opened belatedly, because tradng n the securty was halted, then the closng prce of the securty shall be set as specfed n subsecton 3A.B.6) above, but wherever n subsecton 3A.B.6) t says "addtonal openng prce", read "openng prce", and wherever there t says "addtonal openng tradng phase", read "openng tradng phase". 8) In respect of a securty ncluded n the llqud lst, and a securty ncluded n the mantenance lst, the closng prce shall be calculated as prescrbed n subsecton 3A.B.1) above; f the amount of transactons n the closng phase dd not reach the amount prescrbed under subsecton 3A.B.1) above, then the closng prce shall be calculated accordng to the weghted average of the prces of transactons carred out wth the securty n the closng tradng phase, together wth the transactons carred out durng the openng tradng phase, or wth part of the transactons carred out durng the openng tradng phase, untl ts cumulatve amount equals the amount prescrbed under subsecton 3A.B.1). 9) Canceled. 10) a) Notwthstandng the provsons of subsectons 3A.B.1) to 3A.B.8) above, f the quantty of securtes, accordng to whch closng prces were calculated, s smaller than the quanttes specfed below, as the case may be, then the closng prce shall be calculated n the manner specfed n subsecton 3A.B.10) below: (1) In respect of shares ncluded n the Tel Avv 25 ndex a quantty of securtes equal to 0.5 of the mnmum sze of an order for those shares; (2) In respect of shares not ncluded n the Tel Avv 25 ndex, of securtes convertble nto shares and of rghts - a quantty of securtes equal to the mnmum sze of an order for those securtes; (3) In respect of bonds and bond optons a quantty of securtes equal to 0.1 of the mnmum sze of an order for those securtes; (4) In respect of M.K.M. - a quantty of securtes equal to 0.1 of the mnmum sze of an order for those M.K.M.; (5) In respect of commercal paper - a quantty of securtes equal to 0.1 of the mnmum sze of an order for those commercal papers; (6) In respect of securtes on the small captalzaton lst and on the llqud lst - a quantty of securtes equal to the mnmum sze of an order for those securtes n the contnuous tradng phase, f those securtes were to be traded n the contnuous tradng phase. (7) In respect of hybrd bonds, as defned n subsecton 1.I of chapter 2 above a quantty of securtes equal to the mnmum sze of order for those bonds. b) If the quantty of securtes, accordng to whch the closng prce of a securty was calculated, s smaller than the quanttes specfed n

16 16 subsecton 3A.B.10) above, as the case may be, then the closng prce shall be calculated n the followng manner: (1) The prce of the securty shall be calculated n the manner prescrbed n subsecton 3a.b.1) to 3a.b.9) above, as the case may be; (2) The dfferental between the prce calculated for the securty as sad n subsecton 3A.B.10)b)1) above and the basc prce of the securty shall be calculated (hereafter: "the prce dfferental"); However, f tradng n the securty was halted, then the prce dfferental shall be determned as the dfferental between the prce determned as sad n subsecton 3A.B.10)b)(1) above and the addtonal openng prce of the securty; (3) The rato shall be calculated of the quantty of securtes, accordng to whch the prce sad n subsecton 3A.B.10)b)(1) above was determned, to the quantty specfed n subsecton 3A.B.10)a) above, as the case may be (hereafter: the rato); (4) The product of the prce dfferental tmes the rato, shall be calculated (hereafter: the product); (5) The closng prce of the securty shall be set at the sum of the basc prce, plus the product However, f tradng n the securty was halted, then the closng prce shall be set as the sum of the addtonal openng prce, plus the product. c) The above subsectons a) and b) shall not apply to covered warrants. 11) If tradng n a securty was halted and was not resumed on the same tradng day, then the closng prce shall be set as sad n subsecton 3A.B.1) to 3A.B.5) and n subsecton 3A.B.7) to 3A.B.10) above, mutats mutands; 12) If a securty was not traded on any tradng day, then the closng prce shall be set at the basc prce of the securty on that tradng day. C. If a transacton that was ncluded n the calculaton of a sad closng prce was cancelled, then the General Manager of the Stock Exchange may order the closng prce of that securty to be calculated anew, n the manner specfed n subsecton 3A.B. above and the Stock Exchange ndces be recalculated accordngly. D. The closng prce of a securty s ts determnng prce and t shall be expressed accordng to the steps prescrbed n secton 3.D. n Chapter Fve below. 4. The prce of a securty traded on the Exchange, other than a dervatve, shall not be less than one agora and not more than 9,999,900 agorot per tradng unt.

17 5. The prce of a tradng unt of optons on a share ndex, on optons on share, on optons on fxed-rate non-lnked Israel government bond and on a foregn exchange rate shall not be less than NIS 1 and not more than NIS 999, The prce of a tradng unt n futures on a share ndex and of futures on a foregn exchange rate shall not be less than NIS 10 and not more than NIS 999, The prce of a tradng unt n three-month futures on nterest rates shall not be less than one percentage pont and not more than percentage ponts. 8. The prce of a tradng unt n futures on the Consumer Prce Index shall not be less than one pont and not more than 9, ponts.

18 18 CHAPTER FOUR: PRICE FLUCTUATIONS 1. Prce fluctuatons of securtes other than dervatves A. 1) The maxmum prce fluctuaton permtted on a tradng day, n the openng phase, shall be as follows: a) For shares and bonds convertble nto shares - 35% of the base prce of the securty; b) For opton certfcates and bond optons that may be exercsed n shares - 35% of the base prce of the exercsed shares, multpled by the exercse rato; c) For bonds - 6% of the base prce of the bonds; d) For bond optons - 6% of the base prce of the bonds to be exercsed, multpled by the exercse rato; e) For M.K.M. - 6% of the base prce of the M.K.M. f) For commercal paper - 6% of the base prce of the commercal paper; g) For nsttutonal securtes - 6% of the base prce of the nsttutonal securtes. h) For covered warrants unlmted. 2) Notwthstandng the provsons of subsecton 1) above, there shall be no lmt on the permtted prce fluctuaton n the nstances specfed below: a) On the frst tradng day of securtes traded for the frst tme and of securtes n whch tradng s beng renewed after a halt of more than one month, and n each day of the followng tradng days, untl and ncludng the tradng day on whch tradng occurred for the frst tme n the securty. b) On the last four tradng days before a securty s delsted from tradng; c) On the tradng day "ex rghts" of shares and convertble securtes; d) On the tradng day "ex spn off process" of shares and convertble securtes of the lsted company, n whch a spn off process was carred out; For purposes of ths secton "spn off process" - wthn ts meanng n secton 91.d. of Part Two of the Rules. e) On the last tradng days before a securty lapses or s redeemed; f) In the separate openng tradng, as defned n secton 1A.B of chapter 5 n these regulatons.

19 19 B. Durng the contnuous tradng phase, the pre closng phase and the closng tradng phase unlmted prce fluctuatons wll be permtted. C. Unlmted prce fluctuaton wll be permtted durng the Addtonal Openng Phase of a securty, for whch tradng had been halted for a set term. 2. Prce fluctuatons n dervatves shall be unlmted.

20 CHAPTER FIVE: TRADING IN SECURITIES EXCLUSIVE OF DERIVATIVES Phases of Tradng In these Regulatons: " The Reference Prce " - The prce of the last transacton n the securty; however, untl the frst transacton n the securty s carred out on a certan tradng day, the reference prce shall be equal to that securty's bass prce on that day; "Prce Montorng" a) In the openng phase, n respect to a securty that s not ncluded n the TA-25 ndex the postponement of openng tradng wth that securty n accordance to the Regulatons heren and subject to the exceptons specfed below. b) In the contnuous phase shft to a prce montorng aucton n the securty, n accordance to the Regulatons heren and subject to the exceptons specfed below. c) In the pre-closng phase - the postponement of closng tradng n the securty, n accordance to the Regulatons heren and subject to the exceptons specfed below. "Prce Montorng Aucton" "Mult-lateral Tradng" - Iceberg Order (ICE) "Fll Or Kll Order" (FOK) "Immedate Or Cancel Order" (IOC) Tradng carred out n the format of openng tradng, followng the use of prce montorng n the course of the contnuous tradng phase. Openng tradng, addtonal openng tradng, separate openng tradng, prce montorng aucton and closng tradng. A lmt order submtted wth three portons: total volume, ntal peak sze and addtonal peak sze that s ntended to be shown. Intal Peak sze of an Iceberg order" the porton of an ceberg order to be dsplayed n the order book upon submsson of the order. Addtonal Peak sze of an Iceberg order the porton of an ceberg order desgnated to be dsplayed n the order book followng the full executon of the ntal peak sze. Vsble porton of an ceberg order- the porton of an ceberg order desgnated for dsplay n the order book. Hdden Porton of an ceberg order" the total volume of the order less the porton of the order whch has been executed and less the vsble porton of the order at that tme; A lmt order to be carred out completely and mmedately; A lmt order to be carred out mmedately and completely;

21 21 "Stop-Lmt Order (STL) "Market Order (MKT)" "Lmt Order" (LMT) "Lmt Order for the Openng Trade (LMO)" Trggerng "Dynamc Threshold" - A lmt order, whch n addton to the prce to whch t s lmted, set that t wll become executable n the order book only when the prce of the last transacton equals or s hgher than a specfed prce, or alternatvely, when the prce of the last transacton equals or s lower than a specfed prce (hereafter: trggerng prce ). Upon trggerng, the order wll be regstered n the order book for executon accordng to the prce lmt desgnated on t; A buy order or a sell order, not lmted by prce, to be carred out at the market prce; A buy order or a sell order lmted by any prce; A lmt order to be carred out only durng the openng tradng phase; Submsson n the order book of a stop-lmt order for the purpose of executng transactons accordng to the prce lmt stpulated on the order. The expected rate of change n the prce of a securty compared to the reference prce of that securty, as the Board of Drectors shall determne, on condton that the transacton n whch the reference prce was set was carred out durng or after the last multlateral tradng n the securty. The Board of Drectors may set dfferent values of the Dynamc threshold for dfferent categores of securtes or for dfferent groups of securtes. "Statc Threshold" a) In the Pre-Openng phase The rate of change of the last theoretcal openng prce of the securty compared to ts bass prce, as the Board of Drectors wll prescrbe. b) In other tradng phases The expected rate of change n the prce of the securty compared to the prce determned n the last mult-lateral tradng that was held n the securty, as the Board of Drectors wll prescrbe. The Board of Drectors may set dfferent values of the statc threshold for dfferent categores of securtes or for dfferent groups of securtes. Tradng wll take place n fve tradng phases, as specfed below. A. The Pre-openng Phase No transactons wll be carred out durng ths phase of tradng. 1) A member may only submt buy and sell orders to the Exchange, as specfed below:

22 22 a) Lmt orders (LMT), where the prce s lmted between the basc prce and the lmt of the permtted daly fluctuaton durng the openng phase; b) Lmt orders for the openng trade (LMO), where the prce s lmted between the basc prce and the lmt of the permtted daly fluctuaton at the openng phase. c) Stop-Lmt Order (STL). Orders of ths type shall be submtted n the order book as trgger pendng orders and wll not partcpate n the Openng tradng phase. d) Iceberg Order (ICE), for whch the lmt starts at the base prce up untl the daly prce fluctuaton permtted n the Openng tradng phase. Orders that dffer from those specfed above shall be rejected and notce thereof shall be sent to the member who submtted them. 2) Orders submtted shall be regstered n the Order Book. 3) The precedence of the orders shall be determned as follows: a) Buy sde Orders stpulatng hgher prce lmts shall have prorty over orders wth lower prce lmts. b) Sale sde Orders stpulatng lower prce lmts shall have prorty over orders wth hgher prce lmts. c) For orders stpulatng the same prce lmt, buy and sell orders separately, prorty shall be set as follows: 1) Lmt orders, lmt orders for openng phase and the ntal peak of ceberg orders, accordng to the order receved by TASE; 2) Hdden portons of ceberg orders, accordng to the order receved by TASE. 4) a) The Exchange shall, for each securty separately, calculate and publsh the prce and the tradng volume that would have been determned, f the openng tradng sad below had been carred out for that securty at the tme the calculaton was made, and that n accordance wth the buy and sell orders for that securty receved untl the tme of the calculaton. (The sad prce shall hereafter be called the "theoretcal prce" and the sad tradng volume shall hereafter be called the "theoretcal openng volume"). The theoretcal openng prce of a securty s the prce at whch a full or a partal balance was reached between buy and sell orders, excludng trgger pendng orders, subject to the precedence set n paragraph 3) above and at whch the tradng volume s the hghest.

23 23 If the hghest tradng volume of a certan securty s reached at more than one prce, then the prce nearest the basc prce shall be the theoretcal prce. If no full or partal balance between buy and sell orders s reached or f no orders at all were submtted for that securty, then ts basc prce shall be the theoretcal openng prce of that securty. b) Publcaton of the theoretcal openng prces and of the theoretcal openng volumes for each of the securtes shall begn 10 mnutes after the begnnng of ts pre-openng. When, begnnng wth that moment, an addtonal order s submtted for any securty, and then up-dated theoretcal prces and theoretcal tradng volumes shall be calculated and publshed for that securty. 5) The move to the openng tradng phase a) Immedately before the begnnng of the openng tradng phase (hereafter: "The Orgnal Openng Tme") the last theoretcal TA-25 ndex and the last theoretcal openng prce for each securty shall be calculated. b) If the last theoretcal TA-25 ndex fluctuated by less than 2.5% compared to the bass ndex on that day, or f the rates of change n the last theoretcal prces of all the shares ncluded n the TA-25 ndex are equal to or lower than the statc thresholds determned for those shares - Openng tradng shall take place at the orgnal openng tme. If the last theoretcal TA-25 ndex fluctuated by 2.5% or more compared to the bass ndex on that day, and f the rate of change n the last theoretcal prce of a share ncluded n the TA-25 ndex s hgher than the statc threshold determned for that share, openng tradng on that day shall be postponed for a tme that shall be determned randomly and that shall be between 3 and 4 mnutes (hereafter: "The Frst Extenson").. c) At the end of the frst extenson, mmedately before the openng tradng, the last theoretcal TA-25 ndex and the theoretcal openng prce of every securty shall be recalculated. d) If the last theoretcal TA-25 ndex fluctuated by less than 2.5% compared to the bass ndex on that day, and f the rates of change of the last theoretcal prces of all the shares ncluded n the TA-25 ndex are equal to or lower than the statc thresholds prescrbed for those shares - Openng tradng shall take place at the end of the frst extenson.

24 24 If the last theoretcal TA-25 ndex fluctuated by 2.5% or more compared to the bass ndex on that day, or f the rate of change n the last theoretcal openng prce of a share ncluded n the TA-25 ndex s hgher than the statc thresholds determned for that share, openng tradng on that day shall be postponed for a second tme that s to be determned randomly and that shall be between 3 and 4 mnutes (hereafter: "The Second Extenson"). e) At the end of the second extenson, mmedately before the tme for begnnng the openng tradng phase, the last theoretcal Tel Avv 25 ndex shall agan be calculated. f) If the last theoretcal Tel Avv 25 ndex changed by less than 5% from the basc ndex on that day, openng tradng on that day shall take place at the end of the second extenson. If the last theoretcal Tel Avv 25 ndex changed by 5% or more from the basc ndex on that day, openng tradng on that day shall agan be postponed by an arbtrary amount of tme of between 44 and 45 mnutes (hereafter: "the frst crcut breaker"). g) When the frst crcut breaker s actvated, the followng shall take place: 1) Tradng n dervatves of shares and n dervatves of share ndexes shall be stopped. The sad tradng n dervatves wll be renewed when the openng phase of tradng n shares takes place, 2) A notce that the frst crcut breaker was actvated shall be publshed mmedately over the Stock Exchange nformaton dstrbuton system; 3) If the of the last theoretcal Tel Avv 25 ndex, as calculated under subsecton e) above, changed by 12% or more from the basc ndex on that day, then the General Manager of the Stock Exchange may postpone the openng tradng phase on that day by more than 45 mnutes or untl the end of the tradng day, and that n consultaton wth the Charman of the Board of Drectors. h) At the end of the frst crcut breaker, mmedately before the tme for begnnng the openng tradng phase, the last theoretcal Tel Avv 25 ndex shall agan be calculated. ) If the last theoretcal Tel Avv 25 ndex changed by less than 12% from the basc ndex on that day, openng tradng on that day shall take place at the end of the frst crcut breaker; If the of the last theoretcal Tel Avv 25 ndex, as calculated under subsecton e) above, changed by 12% or more from the basc ndex on that day, then openng tradng n shares, n securtes convertble nto shares and n ETN's of whch the underlyng asset s a share basket ndex shall be postponed and tradng n dervatves of shares and n dervatves of share ndexes shall be stopped (hereafter: "second crcut breaker").

25 25 j) When the second crcut breaker s actvated, the followng shall take place: 1) A notce that the second crcut breaker was actvated shall be publshed mmedately over the Stock Exchange nformaton dstrbuton system; 2) The General Manager of the Stock Exchange may, n consultaton wth the Charman of the Board of Drectors, postpone the openng tradng phase on that day by an addtonal 45 mnutes, or he may stop tradng untl the end of the tradng day. k) 1) If the openng tradng phase was postponed twce on the same day because crcut breakers were actvated and f the last theoretcal Tel Avv 25 ndex, whch was calculated at the end of the second crcut breaker, changed by 12% or more from the basc ndex on that day, then the General Manager of the Stock Exchange or a person authorzed by hm shall stop tradng n shares, n securtes convertble nto shares, n ETN's for whch the underlyng asset s a share basket ndex, n dervatves of shares and n dervatves of share ndexes, and that untl the end of the tradng day. 2) Notwthstandng the aforesad, the General Manager of the Stock Exchange may, n consultaton wth the Charman of the Board of Drectors, resume tradng on the same tradng day, f t s hs opnon that under the crcumstances there s justfcaton for dong so. When the decson to resume tradng has been made, the General Manager of the Stock Exchange may decde to change the tradng schedule and notce thereof shall mmedately be made publc on the nformaton dstrbuton systems of the Stock Exchange. A sad resumpton of tradng may be after less than 45 mnutes elapsed snce the notce of the tradng halt had been made. l) The provsons of the above subsectons f) to k) shall not apply on the tradng day after the day on whch the last theoretcal Tel Avv 25 ndex changed by 12% or more from the basc ndex of that day. m) In addton and subject to the aforesad, for a securty that s not ncluded n the TA-25 ndex the move to the openng tradng phase shall be as specfed below: 1) If the rate of change n the last theoretcal prce of the securty compared to ts basc prce s hgher than the statc threshold determned for that securty, prce montorng shall be actvated for that securty durng an nterval that shall be determned randomly and that shall be between 3 and 4 mnutes.

26 26 2) At the end of the prce montorng aforementoned n subsecton 1) the last theoretcal openng prce of the securty shall agan be calculated accordng to the orders for the securty that were submtted up to the tme of the calculaton. 3) If the rate of change n the last theoretcal prce of the securty compared to ts basc prce s equal to or lower than the statc threshold determned for that securty, openng tradng n that securty shall take place. 4) If the rate of change n the last theoretcal prce of the securty compared to ts basc prce s hgher than the statc threshold determned for that securty, prce montorng shall agan be actvated for that securty durng an nterval that shall be determned randomly and that shall be between 3 and 4 mnutes, followed by openng tradng n that securty. B. The Openng Tradng Phase 1) Durng ths tradng phase, sell orders submtted for each securty durng the preopenng phase, excludng trgger pendng orders, shall confront such buy orders, and an openng prce and tradng volume shall be establshed for each securty. 2) The orders regstered n the Order Book shall be carred out n the order of precedence set n subsecton A.3) above, at the openng prce determned as sad below. 3) a) The Exchange shall calculate the openng prce of each securty separately, n accordance wth the orders submtted durng the preopenng phase, excludng trgger pendng orders. If a transacton ncluded n the aforesad calculaton of the openng prce was canceled, then the General Manager of the Exchange may order the openng prce of that securty to be calculated anew, as specfed n paragraphs 4) and 5) below, and Exchange ndexes to be calculated anew n accordance therewth. b) The calculaton of the openng prce shall be made, for each of the securtes, one after the other; the order of the securtes for calculatng the prce shall be random and t shall change every day. 4) The openng prce of a securty s the prce at whch buy and sell orders are n full or partal balance, excludng trgger pendng orders, subject to the order of precedence prescrbed n subsecton A.3) above, and at whch the tradng volume s the hghest. If the hghest tradng volume of a certan securty s reached at more than one prce, then the prce nearest the basc prce shall be the openng prce. 5) If no full or partal balance between buy and sell orders s reached or f no orders at all were submtted for a securty, then the openng prce of that securty shall be ts basc prce and the tradng volume shall be zero.

27 27 8) a) Orders that were not carred out durng the openng phase of tradng, excludng trgger pendng orders, as well as the part that was not carred out of the orders that were carred out n part durng the openng phase of tradng shall be transferred automatcally to the contnuous tradng phase specfed below. b) The aforesad LMT orders shall be transferred to the contnuous tradng phase wth ther orgnal lmts. c) Stop-lmt orders submtted durng Pre-openng phase shall be transferred to the Contnuous tradng phase. d) The precedence of the sad orders durng the contnuous tradng phase shall be n accordance wth the tme when they were orgnally receved by the Exchange. The provsons of ths subsecton shall not apply to ceberg orders whch were transferred from the Openng to the Contnuous tradng phase and the executed porton durng the openng phase exceedng or equal to the vsble porton. In such case, at the begnnng of Contnuous phase, the addtonal peak sze of the ceberg order shall become the vsble porton and the prorty of executon of ths porton shall be as specfed n subsecton 6.c) below. e) LMO orders, whch were not carred out durng the openng phase of tradng, as well as the part not carred out of the sad orders that were carred out n part durng the openng phase of tradng shall be cancelled. C. The Contnuous Tradng Phase 1) Durng ths phase of tradng, transactons are carred out on a blateral bass. In each transacton the prce of the transacton and the volume traded shall be determned. 1a) a) For each securty, upon the begnnng of Contnuous phase n t, the stop-lmt orders meetng the trggerng crteron wth respect to the openng prce shall be actvated. The order of prorty of trggerng wll be as follows: (1) Accordng to the absolute value of the dfference between the trgger prce and the openng prce, from the orders wth the hghest dfference to those wth the lowest dfference. (2) Orders for whch the absolute value of the dfference between the trgger prce and the openng prce s equal, accordng to the order receved by TASE. b) The prevson of subsecton a) above shall not apply to securtes for whch an openng prce was set but tradng volume was zero. In such case, stop-lmt orders shall be trggered mmedately followng the executon of the frst Contnuous trade transacton n

28 28 the securty on that same day. The order of prorty for trggerng shall be set wth respect to the prce set n ths transacton. 2) A member may submt buy and sell orders to the Exchange only as specfed below: a) Lmt Orders (LMT). b) Market Orders (MKT). c) Fll or kll Orders (FOK). d) Immedate or Cancel Orders (IOC). e) Stop-Lmt Order (STL) f) Iceberg Order (ICE) g) A pre-arranged order can only be submtted as a lmt order (LMT) or as Fll or kll order (FOK) or Immedate or Cancel order (IOC). Orders that dffer from the above wll be rejected. 3) Orders submtted at ths phase of tradng are examned, n the order of ther arrval at the Exchange, whether they can be carred out aganst counter orders that are regstered n the Order Book. Stop-lmt orders shall be examned as aforementoned only followng ther trggerng. 4) An LMT order, ceberg order, trggered stop-lmt order, Fll or kll Order and Immedate or Cancel Order, that s a buy order wll be carred out aganst LMT orders, trggered stop-lmt orders and ceberg orders that are sell orders wth lmts lower than or equal to the lmt n the buy order, begnnng wth the sell order on whch the prce lmt s the lowest and movng up to the sell order on whch the prce lmt equals the prce lmt of the buy order or untl the entre buy order s carred out, as the case may be, subject to subsectons 4b) to 4d) below. An LMT order, ceberg order, trggered stop-lmt order, Fll or kll Order and Immedate or Cancel Order, that s a sell order wll be carred out aganst LMT orders, trggered stop-lmt orders and ceberg orders that are buy orders wth lmts hgher than or equal to the lmt n the sell order, begnnng wth the buy order on whch the prce lmt s the hghest and movng up to the buy order on whch the prce lmt equals the prce lmt of the sell order or untl the entre sell order s carred out, as the case may be, subject to subsectons 4a) to 4b) below. An MKT order that s a buy order wll be carred out aganst LMT orders, trggered stop-lmt orders and ceberg orders that are sell orders, begnnng wth mplementaton aganst the sell order on whch the prce lmt s the lowest and up to the sell order on whch the prce lmt s the hghest, and that untl the entre buy order s carred out, subject to subsectons 4b) to 4d) below. An MKT order that s a sell order wll be carred out aganst LMT orders, trggered stop-lmt orders and ceberg orders that are buy orders, begnnng wth mplementaton aganst buy orders on whch the prce lmt s the hghest

29 29 and movng down to the buy order on whch the prce lmt s the lowest, and that untl the entre sell order s carred out, subject to subsectons 4b) to 4d) below. 4a) Iceberg order submtted to ths tradng phase and not fully executed as stpulated n subsecton 4) above, shall be submtted n the order book wth a vsble porton and a hdden porton, where the vsble porton shall equal the volume of the ntal peak. However, should the sze of the remanng porton followng transacton executon as stpulated n subsecton 4) above, be smaller than the ntal peak, the vsble porton wll equal the volume of the remanng porton. Followng the executon of the entre vsble porton of the order, the hdden porton shall become the vsble porton as follows: a. Should the hdden porton equal or exceed the addtonal peak the addtonal peak sze shall become the vsble porton and the hdden porton shall be reduced accordngly. Notwthstandng that stated above, f followng a reducton n the hdden porton as stpulated n ths subsecton, the volume of the hdden porton falls below the mnmum order sze, then the entre hdden porton shall become the vsble porton, and the hdden porton shall be cancelled out. b. Should the hdden porton be less than the addtonal peak sze the entre hdden porton shall become the vsble porton and the hdden porton shall be cancelled out. 4a1) Upon the submsson of a stop-lmt order, the trgger crteron shall be examned. If the crteron s met the order shall be trggered n the order book mmedately. If the crteron s not met the order wll reman n the order book trggered pendng untl the trgger crteron s met. 4a2) Followng each transacton n a securty, the stop-lmt orders for that securty wll be examned and the orders meetng the trgger crteron wth respect to the prce of that transacton shall be actvated. The prorty order set for trggerng orders shall be as follows: a.) Among the stop-lmt orders for whch the trgger prce set n the order equals or exceeds a certan prce - all orders wth lower trgger prces shall have prorty over those wth hgher trgger prces. b.) Among the stop-lmt orders for whch the trgger prce set n the order equals or s lower than a certan prce - all orders wth hgher trgger prces shall have prorty over those wth lower trgger prces. c.) The order of prorty for trggerng stop-lmt orders wth the same trgger prce shall be the order n whch they are receved by TASE.

30 30 4b) When LMT order has been submtted or ceberg order or upon stop-lmt order trggerng, the prces at whch the order s to be carred out shall be examned. If, n consequence of the order, the expected rate of change n the prce of the securty s greater than the dynamc or the statc threshold, transactons n whch the fluctuaton s lower than or equal to the dynamc or the statc threshold, as the case may be, shall be carred out mmedately as specfed n the above subsecton 4), and mmedately after that prce montorng shall be actvated durng an nterval that shall be determned randomly and that shall be between 5 and 6 mnutes, and a prce montorng aucton for that securty shall take place, subject to the adjustments and changes specfed below: a) The part of the order that was not flled after the aforesad transactons were carred out shall be entered n the Order Book. b) Member may submt buy and sell LMT orders, stop-lmt order (STL) and ceberg orders (ICE) to the Stock Exchange. Stop lmt orders submtted durng a prce montorng for whch the trgger crteron holds wth respect to the last executed transacton prce pror to the start of the prce montorng, shall be actvated mmedately upon submsson and shall partcpate n the tradng conducted durng the prce montorng. c) Whle those orders are beng accepted, a theoretcal prce and a theoretcal tradng volume of the securty shall be publshed. d) At the end of the perod for the acceptance of aforesad orders, the buy and sell orders that were n the Order Book shall be matched; f a complete or a partal matchng between the buy and sell orders was not acheved or f no orders at all had been submtted for the securty, the reference prce of the securty shall be the prce for the prce montorng aucton; f the hghest tradng volume of the securty was acheved at more than one prce, the prce nearest to the reference prce of the securty shall be the montorng aucton prce. e) In a prce montorng aucton of a securty an unlmted fluctuaton of ts prce s permtted. f) After the prce has been establshed n the prce montorng aucton contnuous tradng shall be resumed. g) When the tme for the acceptance of orders for a securty n the course of the Pre-closng phase has ended, the provsons of the above paragraphs a) to f) shall apply; however, the tme for concludng the prce montorng aucton shall be postponed and t shall come when closng phase tradng s n progress. h) The prce montorng mechansm does not cancel orders that were submtted before the prce montorng aucton began.

31 31 4b1) When MKT orders or FOK orders are submtted, the prces at whch the orders are to be flled shall be examned and the followng shall apply: a) Transactons that are to be carred out n consequence of sad orders, n whch the fluctuaton s lower than or equal to the dynamc or the statc threshold, as the case may be, shall be carred out mmedately, as specfed n the above subsecton 4). b) The part of an order that was not flled after the transactons mentoned n the above subsecton a) had been carred out shall be erased and shall not be entered n the Order Book. 4c) When IOC orders are submtted, the prces at whch the orders are to be carred out shall be examned; f the expected rate of change n the prce of the securty s greater than the dynamc or the statc threshold, the order shall be erased and no transactons shall be carred for t. 4d) The provsons of the above subsectons 4b) to 4c) shall not apply to the cases specfed n secton 1B. below. 5) All or part of a lmt order, or a trggered stop-lmt order, n ts entrety or part of t, or an ceberg order, n ts entrety or part of t, whch was not matched aganst other orders regstered n the Order Book as aforesad shall be regstered n the Order Book. MKT order that was not matched aganst other orders that are regstered n the Order Book shall be regstered n the Order Book, subject to the provsons of the above subsecton 4b1), as an LMT order lmted by the prce of the last transacton that was carred out wth that securty. If MKT order was only flled n part, the part that was not flled shall be regstered n the Order Book, subject to the provsons of the above subsecton 4b1), as an LMT order lmted by the prce of the last transacton that was carred out wth the part that was flled. If no transactons wth the securty had as yet been carred out durng the Contnuous Tradng Phase, then an MKT order shall be regstered n the Order Book as an order lmted by the openng prce. 6) Orders regstered n the Order Book, excludng trgger pendng orders, shall be carred out n the order of precedence specfed below: a) Buy sde lmt orders wth hgh prce lmts shall have prorty over lmt orders wth lower prce lmts. b) Sale sde lmt orders wth low prce lmts shall have prorty over lmt orders wth hgher prce lmts. c) For orders wth the same prce lmt, buy and sell orders separately, the order of prorty shall be as follows:

32 32 (1) Lmt orders, actvated stop-lmt orders and vsble portons of ceberg orders n order of receved by TASE. For the purpose of ths subsecton (1), the tme at whch a stop-lmt order s actvated and the tme at whch a porton of an ceberg order s converted to the vsble porton shall be consdered as the tme at whch these were receved by TASE. (2) Hdden portons of ceberg orders, accordng to the order n whch they were receved by TASE. 7) The transactons shall be carred out at the prce of the order, whch appeared n the Order Book. 8) Lmt orders and ceberg orders whch were fully executed shall be deleted from the order book. If a lmt order or an ceberg order or a market order was carred out n part, then the part that was not carred out shall reman on the Order Book, subject to the aforementoned, and t shall be carred out accordng to ts precedence as mentoned n the above subsecton 6. 9) At the end of the contnuous tradng phase for each securty, all orders n the Order Book shall be transferred to the pre closng phase. 10) Fll or Kll orders and Immedate or Cancel orders that were not carred out and the parts of fll or kll orders that were not carred out mmedately after the orders were receved by the Stock Exchange shall be canceled and they shall not be entered n the order book. D. The Pre Closng Phase of Tradng 1) Durng ths phase of tradng, no transactons shall be carred out. 2) Durng ths phase of tradng a "base prce for closng trade" shall be determned for each securty. The prce of the last transacton carred out wth the securty n the contnuous tradng phase shall be the base prce for closng trade. If no transactons were carred out durng the contnuous tradng phase, then a prce equal to the openng prce of the securty shall be the base prce for closng trade. 2a) Buy orders wth hgh prce lmts that were submtted n the earler tradng phases, but not executed, shall be transferred to the Pre-closng phase and shall have prorty over buy orders wth the same or lower lmts. Sell orders wth low prce lmts that were submtted n the earler tradng phases, but not executed, shall be transferred to the Pre-closng phase and shall have prorty sell orders wth the same or hgher lmts.

33 33 3) Members may submt to the Exchange only buy and sell orders as follows: a. Lmt order (LMT) b. Iceberg order (ICE) 4) Submtted orders shall be entered n the order book. 5) Preference of orders shall be as follows: a) Buy sde lmt orders wth hgh prce lmts shall have prorty over lmt orders wth lower prce lmts. b) Sale sde lmt orders wth low prce lmts shall have prorty over lmt orders wth hgher prce lmts. c) For orders wth the same prce lmt, buy and sell orders separately, the order of prorty shall be as follows: (1) Lmt orders, stop-lmt orders actvated durng Contnuous tradng and vsble portons of ceberg orders n order receved by TASE. For the purpose of ths subsecton (1), the tme at whch a stop-lmt order s actvated and the tme at whch a porton of an ceberg order s converted to the vsble porton shall be consdered as the tme at whch these were receved by TASE. (2) Hdden portons of ceberg orders, accordng to the order n whch they were receved by TASE 6) a) The Stock Exchange shall calculate and make publc, for each securty separately, the prce and the turnover that would have been determned, f The closng trade sad below had been carred out for that securty on the date of the calculaton, and that accordng to buy and sell orders for that Securty that were receved up to the tme of the calculaton (the sad prce shall be called the "theoretcal closng prce" and the sad turnover shall be called the "theoretcal closng turnover"). The theoretcal closng prce of a securty s the prce, at whch full or partal balance was reached between buy and sell orders, subject to the order of preferences prescrbed n paragraph 5) above, and at whch the turnover s the greatest. If the greatest turnover wth a securty s obtaned at more than one prce, then the prce closest to the base prce of the closng phase shall be the theoretcal closng prce. If full or partal balance of buy and sell orders s not reached, or f no orders at all were submtted for that securty, then the base prce of the closng phase shall be the theoretcal closng prce.

34 34 b) Publcaton of the theoretcal closng prce and the theoretcal closng turnover for each of the securtes shall begn at the begnnng of ther pre closng phase. When an addtonal order for any securty s submtted from that tme on, the updated theoretcal closng prce and updated theoretcal closng turnover shall be calculated and publshed. 7) The move to the closng tradng phase a) The theoretcal Tel Avv 25 ndex shall be calculated mmedately before the closng tradng phase begns (hereafter: "the closng tradng phase theoretcal Tel Avv 25 ndex"), and last theoretcal closng prce for each securty. The closng tradng phase theoretcal Tel Avv 25 ndex shall not be publshed. b) (1) If the closng tradng phase theoretcal Tel Avv 25 ndex changed by less than 12% from the basc ndex on that day, then closng tradng shall take place. (2) (a) If the closng tradng phase theoretcal Tel Avv 25 ndex changed by 12% or more, then tradng shall be stopped n shares, n securtes convertble nto shares, n ETN's for whch the underlyng asset s a share basket ndex, n dervatves of shares and n dervatves of share ndexes (hereafter: "closng phase crcut breaker"). (b) Notwthstandng the aforesad, the General Manager of the Stock Exchange may, n consultaton wth the Charman of the Board of Drectors, resume tradng on the same tradng day, f t s hs opnon that under the crcumstances there s justfcaton for dong so. When the decson to resume tradng has been made, the General Manager of the Stock Exchange may decde to change the tradng schedule and notce thereof shall mmedately be made publc on the nformaton dstrbuton systems of the Stock Exchange. A sad resumpton of tradng may be after less than 45 mnutes elapsed snce the notce of the tradng halt had been made. c) A notce that the closng phase crcut breaker was actvated shall be publshed mmedately over the Stock Exchange nformaton dstrbuton system; d) The provsons of subsectons b) and c) above shall not apply on a tradng day after the day on whch the last theoretcal Tel Avv 25 ndex changed by 12% or more from the basc ndex of that day.

35 35 e) (1) If the rate of change n the last theoretcal closng prce of a securty s equal to or lower than the dynamc or the statc threshold determned for t, closng tradng n that securty shall be held accordng to the ordnary tmetable. (2) If the fluctuaton n the last theoretcal closng prce of a securty s hgher than the dynamc or the statc threshold determned for t, prce montorng shall be actvated durng an nterval that shall be determned randomly and that shall be between 3 and 4 mnutes. (3) After the prce montorng sad n the above subsecton 2) has been concluded, the last theoretcal closng prce of the securty shall agan be calculated accordng to the orders for the securty that were submtted up to the tme of the calculaton. (4) If the fluctuaton n the last theoretcal closng prce of the securty compared to ts bass prce s equal to or lower than the dynamc or the statc threshold determned for t, closng tradng n that securty shall take place after concluson of the prce montorng sad n the above subsecton 2). (5) If the fluctuaton of the last theoretcal closng prce of the securty s hgher than the dynamc or statc threshold determned for that securty, prce montorng shall agan be actvated for that securty durng an nterval that shall be determned randomly and that shall be between 3 and 4 mnutes. (6) When prce montorng has been actvated a second tme, as sad n the above subsecton 5), closng tradng of the securty shall be conducted followng the prce montorng extenson. E. The Closng Phase of Tradng 1) Cancelled 2) At ths tradng phase the buy and sell orders on the order book at the end of the pre closng stage shall be matched for each securty, and a closng tradng prce and a closng tradng turnover shall be determned for each securty. 3) The orders on the order book shall be carred out n the order of preferences prescrbed n subsecton D.5) above and at ther fxed closng prce. 4) a) The Stock Exchange shall calculate the closng tradng prce for each securty separately, n accordance wth the orders that were on the order book at the end of the pre closng phase. If a transacton, whch was ncluded n the calculaton of a sad closng tradng prce, s cancelled, then the General Manager of the Stock Exchange may order the closng prce of that securty to be calculated anew accordng to the provsons of paragraphs 5) and 6) below, and that accordngly the Stock Exchange ndces be calculated anew.

36 36 b) The closng prces shall be calculated, one after the other, for each of the securtes; 5) The closng prce of a securty s the prce, at whch full or partal balance was reached between buy and sell orders, subject to the order of preferences prescrbed n subsecton D.5) above, and at whch the turnover s the greatest. If the greatest turnover wth a securty s obtaned at more than one prce, then the prce closest to the base prce of the closng phase shall be the closng prce. 6) If full or partal balance of buy and sell orders s not reached, or f at the end of the pre closng phase there were no orders at all for that securty, then the closng shall be equal to the base prce of the closng phase and the closng turnover shall be zero. 7) The Stock Exchange shall publsh the closng prce and the closng turnover for each securty. 8) Orders submtted durng the nterval from the begnnng of the closng tradng phase untl the tme when the closng prce for that securty s set shall be rejected. 1A. Notwthstandng the provsons of secton 1 above, tradng n the securtes specfed below shall be carred out as specfed below: A. Canceled. B. In the followng shares, tradng shall be n two phases only pre-openng phase and an openng phase that wll be at a tme to be set by the Board of Drectors (hereafter: "separate openng tradng") : 1) Shares ncluded n the TA-Composte, as defned n Part Seven of the Regulatons, whch are about to be removed from the TA-Composte followng a tradng suspenson, except for one of the reasons detaled n artcle 6.A.(2) n Part Four of the regulatons - shall be traded on a separate openng tradng on the tradng day whch precedes ther removal date, subject to the condton that no closng tradng phase wll take place on that day. 2) Shares ncluded n the TA-Composte, as defned n Part Seven of the Regulatons, whch are about to be removed from the TA-Composte followng a tradng suspenson, except for one of the reasons detaled n artcle 6.A.(2) n Part Four of the regulatons and on the tradng day whch precedes ther removal date, a closng tradng phase should have taken place, but eventually dd not. A separate openng tradng phase n these shares wll take place on the tradng day followng the tradng day whch precedes ther removal date, subject to the condton that no closng tradng phase wll take place on that day. The Board of Drectors decded that the separate openng tradng shall be at 15:30 PM. In the nterm holdays of Pesach and of Sukkot shall be at 14:00.

37 37 3) The submsson of stop-lmt orders s not permtted durng Separate Openng tradng. C. Tradng n securtes ncluded n the llqudty lst, and securtes ncluded n the mantenance lst, shall be carred out n only four tradng phases: the pre-openng phase, the openng tradng phase, the pre closng phase and the closng tradng phase, as specfed below: 1) In the pre-openng phase as specfed n subsecton 1.A above; 2) In the openng tradng phase - as specfed n subsecton1.b above; However, notwthstandng the provsons of subsecton 1.B.8)a) to 1.B.8)d) above, the followng shall apply to securtes ncluded n the llqudty lst and securtes ncluded n the mantenance lst: a) Orders that were not carred out n the openng tradng phase and the part that was not carred out of the sad orders that were carred out partly n the openng tradng phase shall be automatcally transferred to ther pre closng phase; b) Sad orders shall be transferred to ther pre closng phase wth ther orgnal lmts; c) The preference of sad orders n the pre closng phase shall be determned accordng to the orgnal tme of ther recept at the Stock Exchange. 3) The pre closng tradng phase as specfed n subsecton 1.D. above. However, notwthstandng the provsons of subsecton 1.D.2) above, the followng shall apply to securtes ncluded n the lst In ths tradng phase a "base prce for closng tradng" shall be set for each securty; The base prce for closng tradng shall be equal to the openng prce of the securty. Wth the begnnng of the Pre-closng phase, the stpulatons of subsecton 1.c.1a) shall apply. 4) The closng tradng phase as specfed n subsecton 1.E. above. 5) The submsson of stop-lmt orders s not permtted for securtes on the mantenance Lst or the llqud Securtes Lst. 1B. Notwthstandng the provsons of secton 1. above, prce montorng shall not be actvated n the followng nstances: a) On the frst tradng day of a new securty and on each tradng day thereafter, up to and ncludng the tradng day on whch the securty s traded on the Stock Exchange for the frst tme.

38 38 b) On the frst tradng day of a securty after tradng n t had been halted for a perod longer than three months and on each tradng day thereafter, up to and ncludng the tradng day on whch the securty s traded on the Stock Exchange for the frst tme after a tradng halt. c) In respect of, Warrants, Call optons, rghts and nsttutonal securtes. d) In respect of securtes traded on the Illqudty lst. e) In respect of securtes traded on the Mantenance lst. f) In respect of separate openng tradng, as specfed n the above subsecton 1A.B. g) In respect of Mult-lateral tradng at the end of a tradng halt. h) In respect of Mult-lateral tradng at the end of a crcut breaker. ) On the tradng day after the day on whch a crcut breaker was actvated and tradng had not been resumed on that day. The provsons of ths subsecton shall only apply to securtes, n respect of whch tradng was halted because of the sad crcut breaker. 2. Mnmum and Maxmum Volume of Order A. Maxmum volume sze of an order s as follows: 1) In all securtes other than nsttutonal securtes, shall be as specfed below, but not more than 999,999,999 tradng unts: (a) (b) In respect of shares, of securtes that are convertble nto shares, of rghts and of corporate debentures a quantty of securtes equal to 5% of the quantty of that securty that s lsted for tradng on the Stock Exchange; In respect of Government bonds and short term loans a quantty of securtes equal to 10% of the quantty of that securty that s lsted for tradng on the Stock Exchange. 2) The quantty of securtes sad above shall be rounded as specfed n the followng table: When the quantty of securtes s as sad below: Up to 1,000 From 1,001 to 10,000 From 10,001 to 100,000 More than 100,000 the quantty shall be rounded off as follows: to the nearest 10 unts to the nearest 100 unts to the nearest 1,000 unts to the nearest 10,000 unts 3) The maxmum sze of an order for nsttutonal securtes shall be 999,999,999 tradng unts.

39 39 4) The maxmum sze of an order shall be calculated each month, at the end of the last tradng day of the month, and wll reman vald durng the subsequent month, subject to subsecton (5), heren. 5) On the Ex-day of corporate actons, the amount of securtes shall be adjusted n accordance to bass prce of the securty on that day. 6) For ceberg orders, the above provsons shall apply to the total volume of the order. B. The Mnmum volume of an order s as follows: (a) * In shares, convertble bonds, opton bonds and ETN's- a volume of securtes of a monetary value to be prescrbed by the Board of Drectors, whch shall be between NIS 1,000 and NIS 10,000. The Board of Drectors may set dfferent amounts for dfferent categores or for dfferent groups of securtes. (b) In convertble securtes not enumerated n subsecton (a) above or n subsecton (d) below amount of convertble securtes that s less than the followng alternatve, but not less than one unt prce: (1) The mnmum order sze of the underlyng asset of the convertble securty, dvded by the exercse rato of the convertble securty. If the convertble securty can be converted nto more than a sngle securty, the aforesad calculaton shall be made separately for each of the securtes that arse out of the converson and the mnmum order sze of the order shall be the largest of the amounts obtaned. (2) 0.5% from the regstered amount for trade n the convertble securty. (c) ** In bonds, n commercal securtes and n nsttutonal securtes - amount of bonds or of nsttutonal securtes, as the case may be, of a monetary value to be prescrbed by the Board of Drectors, whch shall be between 10,000 NIS and 50,000 NIS. * The Board of Drectors decded that the monetary value of securtes for purposes of the calculaton of the mnmum sze of a tradng order shall be: For TA-25 shares NIS 5,000. For TA-75 shares, Yeter and ETN's (ncludng ETN's n the debentures market) - 2,000 NIS. ** The Board of Drectors decded that the mnmum sze of an order for bonds ssued by the State of Israel and for commercal paper, whch s to be carred out n the contnuous tradng phase, shall be 30,000 NIS, and the sad mnmum sze for corporate debentures shall be 10,000 NIS.

40 (d) B - 40 In bond warrants - amount of bond warrants that s less than the followng alternatve, but not less than one tradng unt: (1) The mnmum order sze of the underlyng asset of the warrant, dvded by the exercse rato of the aforesad warrant. If the convertble securty can be converted nto more than a sngle securty, the aforesad calculaton shall be made separately for each of the securtes that arse out of the converson and the mnmum order sze of the order shall be the largest of the amounts obtaned. (2) 0.5% from the regstered amount for trade n the warrant. (e) (f) (g) (h) For rghts - one tradng unt of rghts. For M. K. M. - M. K.M. wth a face value of 30,000 NIS. For hybrd bonds, as defned n subsecton 1.I. of chapter 2 above one tradng unt. For covered warrants one tradng unt. ) Notwthstandng the provsons of subsectons (a) to (d) above, f the Board of Drectors has decded to conduct four last tradng days n the securty pror to delstng, the mnmum order sze n the securty shall be one tradng unt. j) Notwthstandng the provsons of subsectons (a) to (d), and (f)) above, n the followng nstances the mnmum order sze shall be 100 tradng unts: - On the frst tradng day n a securty and on each subsequent tradng day untl and ncludng the frst tradng day n the securty. - On the frst tradng day n a securty followng a tradng halt whch exceeded 3 months and on each subsequent tradng day untl and ncludng the frst tradng day n the securty followng the tradng halt. 3) (a) A mnmum order sze, as stated n subsecton 2)(a) to 2)(d) above, s calculated each month, at the end of the last tradng day of the month, and shall reman vald n the course of the whole subsequent month, subject to subsecton (b) above. (b) On the Ex-day of corporate actons, the amount of securtes shall be adjusted n accordance to bass prce of the securty on that day. (c) The amount of securtes calculated n subsectons 2) (a) to 2) (d) shall be rounded, as follows:

41 41 when the volume of securtes s as follows: then the volume shall be rounded off as follows: up to 100 to the nearest whole unt from 101 to 1,000 to the nearest 10 from 1,001 to 10,000 to the nearest 100 from 10,001 to 100,000 to the nearest 1,000 above 100,000 to the nearest 10,000 4) The volume of the ntal peak sze and the addtonal peak sze of ceberg orders shall be greater than or equal to the mnmum order sze under subsectons 2) and 3) above, at all stages of tradng. 5) The volume of stop-lmt orders shall be greater than or equal to the mnmum order sze under subsectons 2) and 3) above at all stages of tradng n whch the submsson of stop-lmt orders s permtted. 6) For all other order types, the volume shall be greater or equal to the mnmum order sze under subsectons 2) and 3) above, solely durng the Contnuous tradng phase. Durng the Pre-openng phase, Addtonal Openng tradng, prce montorng and the Pre-closng phase, the volume shall be greater than or equal to one tradng unt. 3. Customer's Orders - Rules for Acceptance and Executon A. Change and cancellaton of orders 1) If an order has not yet been carred out n whole or n part, then t may be canceled or changed, except durng the perods specfed n subsecton 2) below. A cancelled order shall be removed from the Order Book. An order that was wholly or partly changed shall be treated - n respect of ts precedence for executon - lke an order receved when the change was receved on the Exchange. 2) Durng the perods of tme specfed below orders cannot be changed or canceled: a) From the begnnng of the openng phase of tradng of a securty untl the openng prce for that securty has been determned; b) Durng the frst 15 mnutes of a tradng halt for a set perod. c) From the begnnng of the closng tradng phase of a securty untl the closng tradng prce and the closng prce for that securty s determne. 3) An order or part of an order that was not carred out untl the end of the tradng day shall be cancelled.

42 B. Rejecton of orders B - 42 Orders specfed below shall be rejected, nter ala n the followng cases, and notce thereof shall be sent mmedately to the member who submtted them: 1) An order submtted for the openng phase of tradng wth a lmt that exceeds the permtted lmts of daly fluctuaton at ths tradng phase; 2) An order that dffers from what s permtted at any tradng phase; 3) An order submtted not n accordance wth the prescrbed tmetables; 4) An order that ncorporates mstaken data, such as wrong number of the securty or wrong knd of order; 5) Cancelled; 6) An order for a securty n whch tradng was halted for a set perod, durng a stage when no orders are to be submtted; 7) An order for a securty n whch tradng was halted for a perod that s not a set perod; 8) An order for a securty that s not traded on that day. 9) A pre-arranged order to be submtted durng the pre-openng phase or the pre closng phase; 10) A pre-arranged order that s not a lmt order; 11) A pre-arranged order that wll be submtted durng the last thrty mnutes of a stop n tradng for a set perod, whch ends n the course of the contnuous tradng phase. 12) An order of a sze that s larger than the maxmum sze prescrbed n secton 2.a above. 13) An order not meetng the mnmum order sze crtera under paragraph 2.b above. 14) A stop-lmt order for whch the trgger crteron has not been completely set, or for whch a prce lmt has not been placed. 15) An ceberg order wthout a total volume or wth an ntal peak sze or an addtonal peak sze for whch a prce lmt has not been placed. 16) An ceberg order for whch the volume of the sum of the ntal peak sze and the addtonal peak sze s greater than the total volume of the order. C. Canceled D. Steps for the submsson of orders (Tck sze)

43 43 Orders shall be submtted n fxed steps, n accordance wth the prce of the securty and wth the followng specfcatons: 1) In respect of shares and securtes convertble nto shares - When the prce of the securty s between 1 and 1,000 Agorot - n steps of 0.1 Agorah; - When the prce of the securty s between 1,000 and 10,000 Agorot - n steps of 1 Agorah; - When the prce of the securty s between 10,000 and 100,000 Agorot - n steps of 10 Agorot; - When the prce of the securty s above 100,000 Agorot - n steps of 100 Agorot; 2) In respect of bonds, optons on bonds and nsttutonal securtes - When the prce of the securty s between 1 and 10,000 Agorot - n steps of 0.01 Agorah; - When the prce of the securty s above 10,000 Agorot - n steps of 1 Agorah; 3) In respect of M.K.M. and of commercal securtes - orders shall be submtted n constant steps of 0.01 Agorah. The stpulatons of ths paragraph shall apply to the trgger prce of a stop-lmt order as well. E. An order submtted to the Stock Exchange by a member shall nclude, nter ala, the followng partculars: 1) A mark, structured as the Stock Exchange shall prescrbe, whether the order s for the nostro account or for a clent account; 2) The dentfyng code of the account wth the member, of the person who submts the order, structured as the Stock Exchange shall prescrbe. F. Pre-arranged orders 1) Pre-arranged orders can be submtted only durng the contnuous tradng phase. 2) Pre-arranged orders must not be submtted durng the last thrty mnutes of a stop n tradng for a set perod, whch ends n the course of contnuous tradng phase and durng prce montorng aucton. 4. Monetary values n ths Chapter shall not be lnked to the Consumer Prce Index. 5. Tradng on the llqud securtes lst A. The lst of llqud securtes (hereafter: " the llqud lst" or "the lst") shall be determned by the Drector of Trade, and he shall update t twce a year accordng to the followng condtons. B. For the purposes of ths secton:

44 44 "Determnng date" Aprl 15th or October 15th of each year, as the case may be; "Determnng perod" sx months that ended on a determnng date. "mean of daly trade" an amount, whch was equaled or exceeded by the daly monetary consderaton of tradng turnover n the tradng phases on the Stock Exchange on one half of the tradng days durng the determnng perod; "average daly turnover" - monetary consderaton of tradng turnover on the Stock Exchange n a securty durng the determnng perod, dvded by the number of tradng days n the determnng perod, other than tradng days on whch the securty was suspended throughout the entre tradng day. C. The followng securtes shall be ncluded n the llqud lst: 1) Shares, partcpaton unts, bonds convertble nto shares, closed jont nvestment fund unts, ETN's traded accordng to share tradng rules, other than cover optons, each of whch meets all the followng condtons: a) Its mean of daly trade on the Stock Exchange n the determnng perod was less than an amount to be set by the Board of Drectors ; b) Its average daly turnover on the Stock Exchange n the determnng perod was less than an amount to be set by the Board of Drectors ** ; c) It was lsted for tradng on the Stock Exchange before the begnnng of the determnng perod. d) Was not part of a cessaton of tradng, whch lasted wthout a tradng halt durng the determnng perod. 2) If a securty was ncluded n the lst as sad n subsecton 5.C.1) above, then all the optons and purchase optons that can be exercsed as that securty shall also be ncluded n the lst. D. Updatng of the lst wll be carred out as follows: 1) Soon after the determnng date the Drector shall determne the lst of securtes that are canddates for ncluson n the lst, and the lst of securtes that are canddates for removal from the lst accordng to the condtons prescrbed n subsecton 5.C.1) above (hereafter: "the canddate lsts"). 2) The Stock exchange shall publsh the canddate lsts, and t shall also nform the companes, whose securtes appear on the canddate lsts, that ther securtes are canddates for ncluson n or removal from the lst, as the case The Board of Drectors decded that the mean daly tradng turnover on the Exchange of the securty durng the determnng perod shall be NIS 2,000. ** The Board of Drectors decded that the mean daly tradng turnover on the Exchange of the securty durng the determnng perod shall be NIS 2,000.

45 45 may be. The canddate lsts shall be publshed and the sad notfcatons sent out wthn three weeks after the determnng date. 3) The lst shall be updated on June 15 th and on December 15 th of each year, and f those are not tradng days, then on the next followng tradng day (each of these hereafter: "the updatng day"). On June 15 th the lst shall be updated on the bass of the canddate lsts determned soon after the determnng date n Aprl before that date. On December 15 th the lst shall be updated on the bass of the canddate lsts determned soon after the determnng date n October before that date. The lsts shall be updated so that on the updatng day the securtes n the lst of canddates for ncluson are added to the lst and the securtes n the lst of canddates for removal are removed from the lst, subject to the provsons of subsecton 5.D.4) below. 4) Notwthstandng the provsons of subsecton 5.C. above, a securty shall not be added to the lst, even f t s ncluded n the lst of canddates for ncluson, n the case of one or more of the stuatons specfed below: a) In respect of the securty there s market makng, n accordance wth the Stock Exchange Regulatons; b) The securty s ncluded n the small captalzaton lst; 5) Updatng the lst not on an updatng day: a) A securty ncluded n the lst shall be removed from t on the tradng day on whch one or more of the of the condtons specfed n subsecton 5.D.4) above apples to t; b) A securty, whch was ncluded n a lst of canddates for ncluson n the lst, but fnally was not ncluded n t because one or more of the of the condtons specfed n subsecton 5.D.4) above appled to t, shall be added to the lst on the frst tradng day on whch none of the sad condtons apply to t. c) A securty ncluded n the lst shall be removed from t, durng the perod between the record day and the followng updatng day, f the same securty, s expected to be removed from the lst on the sad updatng day, snce tradng n the securty was suspended contnuously throughout the record perod. 6) Notwthstandng the aforesad, the determnng date for determnng the lsts of canddates for the frst tme shall be June 15, 2007, and the lst shall be determned by the Drector of Trade for the frst tme on August 12, 2007.

46 46 6. CLIENT S ORDERS FOR TRADING, SUBMITTED TO THE STOCK EXCHANGE BY MEANS OF QUOTE GENERATORS For the purposes of ths secton "A clent" a clent account of a member, ncludng a nostro account of a member; "Generator number" an dentfcaton number n the Stock Exchange tradng systems, whch the Stock Exchange assgned to a member who was gven approval by the Manager of Tradng, to permt a clent of that member - ncludng the member's nostro - (hereafter: "the clent") to transmt orders to the Stock Exchange by means of a quote generator; a. Stock Exchange approval for the submsson orders by means of a quote generator A member shall not allow hs clent to transmt orders to the Stock Exchange by means of a quote generator, except after the member submtted an applcaton to the Stock Exchange to be allowed to transmt orders by means of a quote generator (hereafter: the applcaton) and after he receved a generator number from the Stock Exchange for that quote generator. The applcaton shall be submtted to the Stock Exchange on the form of the Applcaton to Submt Tradng Orders by Means of a Quote Generator, whch s attached to these temporary gudelnes. When a member has receved a generator number for a certan quote generator from the Stock Exchange, then he shall allow the clent to act by means of the sad quote generator only on condton that the clent who acts by means of the sad quote generator mark all the orders he submts by means of the sad quote generator wth the generator number, whch the member receved from the Stock Exchange for that quote generator. A member, who receved a generator number from the Stock Exchange for a certan quote generator, shall nform the Stock Exchange mmedately when actvty by means of that quote generator s stopped. b. Use of a generator number only for orders that orgnate from quote generators When a member has receved a generator number from the Stock Exchange for a quote generator operated by hm, then t shall be hs responsblty that through the sad quote generator tradng orders be transmtted only by means of that quote generator. A member may allow hs clent to submt tradng orders by means of more than one quote generator, on condton that the member submtted a separate applcaton n respect of each of the sad quote generators, and on condton that he receved a generator number from the Stock Exchange for every one of those quote generators.

47 47 c. Condtons for operatng a quote generator through a member A member may allow hs clent to operate through hm by means of a quote generator, on condton that the followng condtons are compled wth: 1) The member receved a generator number from the Stock Exchange for that quote generator; all the orders that wll be transmtted by means of that quote generator shall be marked wth the sad generator number; 2) The member dsposes of an nfrastructure that enables hm to dsconnect a quote generator mmedately, so that t becomes mpossble to transmt orders for tradng by means of that quote generator. d. Preparatons by the member whose clents transmt tradng orders by means of quote generators 1. Appontment of a supervsor of quote generator actvty A member whose clents transmt tradng orders by means of quote generators shall appont a staff member on hs behalf to supervse hs clents' sad actvty (hereafter: the supervsor). The supervsor shall nform the Stock Exchange, at ts request, of any relevant partcular that s connected to the actvty of the member's clents by means of quote generators. The member shall nform the Stock Exchange of any change n the supervsor's dentty. 2. Dsconnectng a quote generator from tradng A member shall allow hs clent to operate by means of a quote generator, subject to the clent's certfcaton that he s aware of and agrees to the followng: a) The member wll dsconnect the quote generator, so that t becomes mpossble to transmt tradng orders by means of t, f the Stock Exchange requested that he do so; b) The member wll cancel orders that were submtted, but have not yet been carred out, f the Stock Exchange requested that he do so; c) The Stock Exchange has the rght to reject orders transmtted by means of a generator number assgned to the member for a clent who acts by means of a quote generator, f t s seen that that clent's actvty nterferes wth the orderly and far conduct of tradng on the Stock Exchange. In such a case the Stock Exchange shall mmedately cancel orders that were not yet carred out and had been transmtted by the clent by means of that quote generator before t was decded to reject the orders, as aforesad.

48 48 3. Markng orders Members shall mark orders that orgnated from quote generators n the manner that wll be prescrbed by the Stock Exchange. e. Temporary cessaton of the operaton of all quotes generators The General Manager of the Stock Exchange or a person authorzed by hm may prescrbe that on all or part of a certan tradng day the transmsson of tradng orders by means of quote generators wll not be allowed, and that f unusual tradng actvty s expected on that day. Notce of the prohbton to operate by means of quote generators shall be delvered to the supervsors, who shall see to t that the quote generators are mmedately dsconnected. f. Acton the Stock Exchange may take towards a member whose clent operates by means of a quote generator The Stock Exchange may reject orders transmtted by a generator number, whch t allocated to a member for a clent who operates by means of a quote generator, f t s seen that that clent's actvty nterferes wth the orderly and far conduct of tradng on the Stock Exchange; In such an nstance, the Stock Exchange shall mmedately cancel orders that were not yet carred out and had been transmtted by the clent by means of that quote generator before t was decded to reject the orders, as aforesad.

49 49 CHAPTER SIX: TRADING IN DERIVATIVES 1. THE CONDUCT OF TRADING A. In the course of tradng two-sded transactons shall be carred out. For each transacton, the prce and quantty shall be determned separately. B. A member may submt only the followng buy and sell orders to the Exchange: 1) Lmt Orders (LMT); 2) Fll or Kll Orders (FOK) 3) Immedate or Cancel Orders (IOC). A matchng order may be submtted as a lmt order (LMT), as a carry out mmedately and completely order (IOC) or as an mmedate or cancel order (IOC). Orders that dffer from those specfed here wll be rejected. C. The submtted orders are examned n the order of ther arrval at the Exchange, to see whether they can be carred out aganst opposte orders on the Order Book. D. 1) Lmt orders that are buy orders, and also IOC orders that are buy orders, shall be carred out aganst opposte lmt orders, on whch the prce lmt s lower than or equal to the prce lmt on the buy orders, begnnng wth the opposte order wth the lowest prce lmt and up to the opposte order wth the prce lmt that equals the prce lmt on the buy order or untl all buy orders have been carred out, as the case may be. An FOK order that s a buy order shall be carred out only f - when t s submtted - the quantty of opposte orders on the Order Book, aganst whch t can be carred out, suffces at least for the mplementaton of the entre buy order. If the quantty of the sad opposte orders does not suffce, as aforesad, then the buy order shall lapse. 2) Lmt orders, whch are sell orders, and also IOC orders, whch are sell orders shall be carred out aganst opposte lmt orders, on whch the prce lmtaton s hgher than or equal to the prce lmt on the sell orders, begnnng wth the opposte order wth the hghest prce lmt and down to the opposte order wth the prce lmt that equals the prce lmt on the sell order or untl all sell orders have been carred out, as the case may be. An FOK order that s a sell order shall be carred out only f - when t s submtted - the quantty of opposte orders on the Order Book, aganst whch t can be carred out, suffces at least for the mplementaton of the entre sell order. If the quantty of the sad opposte orders does not suffce, as aforesad, then the sell order shall lapse. E. All or part of a lmt order, that was not carred out aganst opposte orders on the Order Book, shall be recorded n the Order Book.

50 50 F. An FOK order, that was not carred out and also an IOC order that was not carred out, as well the part of an IOC order that was not carred out mmedately after the order was receved on the Exchange shall lapse and they shall not be recorded n the Order Book. G. Orders recorded n the Order Book shall be carred out accordng to the order of preference specfed below: Buy orders wth a hgh prce lmt shall be carred out before buy orders wth a lower prce lmt. Sell orders wth a low prce lmt shall be carred out before sell orders wth a hgher prce lmt. Orders wth the same prce lmt shall be carred out n the order n whch they were receved by the Exchange. H. The transactons shall be carred out at the prce of the order, as t appears n the Order Book. I. Orders carred out n full shall be removed from the Order Book. If an order was carred out n part, then the part that was not carred out shall reman on the Order Book and t shall be carred out n the order of preference determned for t accordng to the tme when the orgnal order was receved by the Exchange. J. An order or part of an order on the Order Book at the end of tradng shall be cancelled. 2. MAXIMUM AND MINIMUM SIZE OF ORDER A. The maxmum sze of an order for optons shall be 2,000 tradng unts. The maxmum sze of an order for futures shall be 200 tradng unts. B. Notwthstandng the provsons of subsectons (a) above: The maxmum sze of a pre-arranged order for optons shall be 10,000 tradng unts. The maxmum sze of a pre-arranged order for futures shall be 1,00 tradng unts. C. The mnmum sze of an order shall be one tradng unts. 3. CLIENT'S ORDERS - REGULATIONS FOR ACCEPTANCE AND PERFORMANCE A. Changes and cancellatons of orders 1) If an order wrtten n the Order Book has not yet been carred out, n whole or n part, then t can be cancelled or changed, subject to the provson of subsecton 2) below.

51 51 2) In the followng nstances an order n the Order Book can be canceled, but orders cannot be changed: a) In respect of a dervatve a tradng halt was determned. b) In respect of an opton that the underlyng asset of whch s traded on the Stock Exchange other than optons on securtes ndexes durng the contnuous phase and the Pre-closng phase, durng the tme n whch prce montorng s beng actvated n respect of the opton's underlyng asset. 3) A cancelled order shall be removed from the Order Book. 4) If an order was changed n whole or n part, then - for purposes of ts precedence for performance - t shall be treated lke an order receved at the tme the change was receved at the Exchange. B. Rejecton of orders Orders specfed below shall be rejected and notce thereof shall be sent mmedately to the member who submtted them: 1) Orders submtted not n accordance wth the prescrbed tmetables; 2) Orders that nclude wrong data, such as a wrong symbol of a dervatve or wrong type of order; 3) An order other than a cancellaton order, submtted for a dervatve n the followng nstances: a) When tradng n the dervatve s temporarly halted or suspended. b) In respect of an opton, the underlyng asset of whch s traded on the Stock Exchange other than optons on securtes ndces durng the contnuous phase and the pre closng phase, durng the tme n whch prce montorng s beng actvated n respect of the opton's underlyng asset. 4) An order for dervatve whch s not beng traded on the same day 5) An order of a sze that s larger than the maxmum sze prescrbed n secton 2 above. C. Steps for the submsson of orders 1) Members' orders for optons on a share ndex, on optons on share, optons on fxed-rate non-lnked Israel government bond and on a foregn exchange rate shall be submtted n fxed steps n accordance wth the prce of the traded opton, as specfed below: up to NIS 20: n steps of NIS 1; above NIS 20 and up to NIS n steps of NIS 2; above NIS 100 and up to NIS n steps of NIS 5; above NIS n steps of NIS 10;

52 The prce shall be stated n whole New Israel Shekels. 52 2) Member's orders for futures on the equty ndex and for futures on currency exchange rates shall be submtted n fxed steps of 10 NIS. The prce of the sad futures shall be stated n whole New Israel Shekels. 3) Members' orders for three month nterest rate futures shall be submtted n fxed steps of one hundredth of a percentage pont. The prce of sad futures shall be stated n whole ponts and n multples of one hundredth of a percentage pont. 4) Members' orders for futures on the Consumer Prce Index shall be submtted n fxed steps of fve one hundredths of a pont. The prce of sad futures shall be stated n whole ponts and n multples of fve one hundredths of a pont. D. An order submtted to the Exchange by a member shall, nter ala, nclude the followng partculars: 1) A mark, structured as the Stock Exchange shall prescrbe, to show whether the order s for the nostro account or for clents accounts. 2) The dentfcaton code of the account number held by the person who submts the order va the member, the structure of whch shall be prescrbed by Stock Exchange. 4. CALCULATION OF THE CLOSING PRICE OF A DERIVATIVE A. 1) The determnng prce of a dervatve on a tradng day shall be the weghted average of the prces set n the last fve transactons carred out wth that dervatve, on condton that n them a total of at least twenty-fve dervatves were sold or bought. 2) If at least twenty-fve dervatves were not bought or sold n the last fve transactons wth that dervatve, then the determnng prce of the dervatve shall be the weghted average of the prces set n the last transactons wth that dervatve, n whch a total of at least twenty-fve dervatves were sold or bought. 3) If no transactons of that dervatve were carred out wth at least twenty-fve dervatves, then the determnng prce shall be calculated accordng to the weghted average of the prces set n all transactons carred out wth the dervatve on that tradng day.

53 53 4) If no transactons were carred out wth that dervatve on that tradng day, then the determnng prce shall be dentcal wth the determnng prce on the precedng tradng day; however, f no transacton was carred out wth that dervatve snce t began to be traded, then the determnng prce of that dervatve shall be marked "not yet establshed". B. If a transacton ncluded n the calculaton of the determnng prce was canceled, then the General Manager of the Exchange may order that the determnng prce of that dervatve be calculated anew, as specfed paragraph A. above. C. The determnng prces of dervatves shall be rounded off, as specfed below: 5. Canceled. 1) For dervatves of share ndexes, dervatves of share, dervatves on fxed-rate non-lnked Israel government bond and dervatves of foregn currency exchange rates - to the nearest whole new shekel; 2) For three month nterest rate futures and for consumer prce ndex futures - to the nearest one hundredth of a percentage pont and to the nearest one hundredth pont, respectvely. 6. RESTRICTIONS ON THE NUMBER OF OPEN POSITIONS PER CLIENT A. 1) The dervatves held n all the followng accounts shall be taken nto account, for purposes of the restrctons on open postons per clent: a) Accounts n the clent's name, whether alone or together wth others; b) Accounts n the names of the clent's relatves who lve wth hm or who are hs dependents or whose dependent he s, whether alone or together wth others; c) Accounts n whch the clent s allowed to act at hs dscreton, n accordance wth a power of attorney; d) The accounts of a body corporate, n whch 50% of the share captal or of the votng rghts are, drectly or ndrectly, held n the clent's name or n the name of the clent's relatves, who lve wth hm or f the one s a dependent of the other. 2) All the provsons about the lmtaton on open postons per clent shall apply to a portfolo manager and the dervatves held n all the accounts managed by hm shall be taken nto account. 3) All the provsons about the lmtaton on open postons per clent shall apply to nvestment trust fund managers, to beneft fund managers, to tranng fund managers, to penson fund managers or to nsurance companes and n respect of each of these the dervatves held n all the accounts of all the bodes managed by them shall be taken nto account. 4) All the provsons about the lmtaton on open postons per clent shall apply to a member's nostro account;

54 54 B. 1) A clent's open postons on the rsng market sde, for any underlyng asset whatsoever, shall be calculated accordng to the followng formula: Where: OP u = n L S L L { C + P + 2 ( C1 + F NS )} = 1 OP u = The clent's open postons on the rsng market sde, for any underlyng asset whatsoever L C S P = L C1 = L F = = The credt balance of buy optons, other than buy optons wth an exercse prce of NS 1, held by the clent for the expraton date The debt balance (n absolute terms) of sell optons held by the clent for the expraton date the credt balance of buy optons wth an exercse prce of NS 1, held by the clent for the expraton date the credt balance of futures held by the clent for the expraton date n = NS = the number of exercse dates for whch the clent has postons the number of contracts set off, whch shall be calculated by the followng formula: L L S S ( Sn + F Sn F ) NS = Mn ; + Where: L Sn = The credt balance of synthetc contracts held by the clent for the expraton date S Sn = The debt balance (n absolute terms) of synthetc contracts held by the clent for the expraton date S F = The debt balance (n absolute terms) of futures held by the clent for the expraton date 2) Notwthstandng the provsons of the above paragraph 1), the open postons n a rsng market of clents who are market makers, as defned below, n respect of an underlyng asset that s a share or n respect of an underlyng asset that s a Shahar type bond, as the case may be, and the open postons n a rsng market of a clent who s not a market maker n respect of an underlyng asset that s a Shahar type bond shall be calculated accordng to the followng formula: Where: OP E u n n { + + ( + )} ( + ) L S L L S L L C P 2 C1 F NS 2Mn Sl ; Sn F NS = = 1 = 1

55 55 E OP u Open postons per clent who s a market maker on the rsng sde of the market, wth an underlyng asset that s a share or n respect of an underlyng asset that s a Shahar type bond, as the case may be, and the open postons n a rsng market of a clent who s not a market maker n respect of an underlyng asset that s a Shahar type bond. S Sl For a clent who s a market maker, n a rsng market, n respect of an underlyng asset that s a share: the credt balance n term of unts of share whch the market maker had reported on to the stock exchange, but not more than half of the open postons' s lmtaton that was set to the specfc share. For a clent who s a market maker, n a rsng market, n respect of an underlyng asset that s a Shahar type bond: The credt balance n term of unts of Shahar type bond, whch the market maker had reported on to the stock exchange, but not more than 10,000 unts. For a clent who s not a market maker, n a rsng market, n respect of an underlyng asset that s a Shahar type bond: The credt balance n term of unts of Shahar type bond, whch the clent had reported on to the stock exchange, but not more than 5,000 unts. L L C -Sn, NS, n, above. F, L C1 L S P, wthn ther meanng n subsecton B.1) 3) Notwthstandng the provsons of the above paragraph 1), the open postons n a rsng market of clents, n respect of an underlyng asset that s a foregn currency, shall be calculated accordng to the followng formula: L S L L OP = C + P + 2 C1 + F NS u ( ) L C NS, F, L C1 L S P, OPu, wthn ther meanng n subsecton B.1) above. Whle: s the upcomng expraton date. C. 1) A clent's open postons on the fallng market sde, for any underlyng asset Whatsoever, shall be calculated by the followng formula: Where: OP d = n S L S S { C + P + 2 ( C1 + F NS )} = 1 OP d = the clent's open postons on the fallng market sde, for any underlyng asset whatsoever

56 56 S C = the debt balance (n absolute terms) of buy optons, other than buy optons wth an exercse prce of NS 1, whch the clent holds for the expraton date L P = the credt balance of sell optons whch the clent holds for the expraton date S C1 = the debt balance (n absolute terms) of buy optons wth an exercse prce of NS 1, whch the clent holds for the expraton date S F = the debt balance (n absolute terms) of futures whch the clent holds for the expraton date n = the number of exercse dates for whch the clent has postons NS = as defned n subsecton B. 1) above 2) Notwthstandng the provsons of paragraph 1) above, open postons of a clent that s a market maker, as defned below, on the fallng sde of the market for an underlyng asset that s a share, or n respect of an underlyng asset that s a Shahar type bond, as the case may be, and the open postons on the sde of the fallng market of a clent who s not a market maker n respect of an underlyng asset that s a Shahar type bond shall be calculated accordng to the followng formula: OP E d n n { + + ( + )} ( + ) S L S S L S S C P 2 C1 F NS 2Mn Sl, Sn F NS = = 1 = 1 Where: E OP u Open postons per clent who s a market maker on the fallng sde of the market, wth an underlyng asset that s a share or n respect of an underlyng asset that s a Shahar type bond, as the case may be, and the open postons on the sde of the fallng market of a clent who s not a market maker n respect of an underlyng asset that s a Shahar type bond. S Sl For a clent who s a market maker, n a fallng sde of the market, n respect of an underlyng asset that s a share: The debt balance n term of unts of share whch the market maker had reported on to the stock exchange, but no more than half of the open postons's lmtaton that was set to the specfc share. For a clent who s a market maker, n a fallng sde of the market, n respect of an underlyng asset that s a Shahar type bond: The debt balance n term of unts of Shahar type bond, whch the market maker had reported on to the stock exchange, but not more than 10,000 unts. For a clent who s not a market maker, n a fallng sde of the market, n respect of an underlyng asset that s a Shahar type bond: The debt balance n term of unts of Shahar type bond, whch the clent had reported on to the stock exchange, but not more than 5,000 unts.

57 57 S C NS, n, F, S C1, P, wthn ther meanng n subsecton B.1) above. S L S Sl - wthn ts meanng n subsecton B.1) above. 3) Notwthstandng the provsons of the above paragraph 1), the open postons n a fallng sde of the market of clents, n respect of an underlyng asset that s a foregn currency, shall be calculated accordng to the followng formula: OP d = C + P S L S S ( C + F NS ) C, S OP, d L P C1, S F, S NS, wthn ther meanng n subsecton B.1) above. Whle: s the upcomng expraton date. D. The total of open postons for a clent (rsng market sde or fallng market sde, as the case may be) shall be as follows: 1) In respect of a dervatve, for whch the underlyng asset s the Tel Avv 25 ndex not more than 30,000; 2) In respect of a dervatve, for whch the underlyng asset s the Tel Avv Banks ndex not more than 24,000; 3) In respect of a dervatve, for whch the underlyng asset s the TA-100 ndex not more than 30,000. 4) In respect of a dervatve, for whch the underlyng asset s a currency exchange rate not more than 100,000 and that s only durng one of the three tradng days before the expraton date. For the purposes of ths subsecton, be taken nto account balance of optons and futures contracts only short exercse date. 5) n respect of a dervatve for whch a share s the underlyng asset, the Board of Drectors shall decde once n sx months durng the frst quarter and the thrd quarter of the calendar year, and also at any tme when t deems t proper to do so what the restrcton on postons n respect of a dervatve shall be, on condton that the restrcton that wll be decded not be greater than the maxmum possble restrcton on postons accordng to the followng formula: PL I = T T 25 P 25 PL p M Where: The decsons of the Board of Drectors on the restrcton of open postons on share optons are specfed n the Chapter "Decsons of the Board of Drectors" n ths gude.

58 58 T = The maxmum possble restrcton on postons n respect of optons on share = The average daly tradng volume of share n the sx months that ended PLI on the record date. T 25 = The average daly tradng volume of the TA-25 ndex n the sx months that ended on the record date. P 25 = The TA-25 ndex, correct as of the record date. PL 25 = The restrcton on open postons n respect of dervatves of the TA-25 ndex M = The underlyng asset multplers for optons on share P = The prce of share n NIS, correct as of the record date. For the purposes of ths secton: "The record date" December 31 st or June 30 th, as the case may be, that precedes the resoluton of the board of drectors regardng the open postons n dervatve for whch the underlyng asset s a share. "the average daly tradng volume of a share" the monetary consderaton for the tradng volume of the share on the Stock Exchange durng the sx months that ended on the record date. dvded by the number of days on whch tradng n the share took place durng the sad perod; "the average daly tradng volume of the TA-25 ndex" the monetary consderaton for the tradng volume of the TA-25 ndex on the Stock Exchange durng the sx months that ended on the record date. dvded by the number of days on whch tradng took place on the Stock Exchange durng the sad perod; however, n the case of a dervatve for whch the underlyng asset s a share, n respect of a clent who only holds synthetc contracts to credt and n respect of a clent who only holds synthetc contracts to debt, the restrcton shall not exceed double the restrcton on open postons that the Board of Drectors decded n respect of optons on that share. 6) In respect of a dervatve, for whch the underlyng asset s fxed-rate nonlnked Israel government bond not more than 5,000; Notwthstandng the aforesad, the total of open postons for a clent who s a market maker of a dervatve, the underlyng asset of whch s a Shahar type bond, shall not be greater than 10,000.

59 59 E. When a decson has been made to change the lmts on open postons In a manner that reduces the permtted open postons then thrty days' advance notce thereof shall be gven to the members. F. For the purposes of ths secton - "Synthetc contract" a synthetc contract to credt or a synthetc contract to debt. "Synthetc contract to credt" - - The aggregate of buy optons to credt and sell optons to debt wth the same exercse prce and the same expraton date; - buy optons to credt wth an exercse prce of NS 1. "Synthetc contract to debt" - The total of buy optons to debt and sell optons to debt wth the same exercse prce and the same expraton date; - Buy optons to debt wth an exercse prce of NS 1. "A share unt" An amount of shares that s equal to the multpler of the underlyng asset of the share opton as long as the above amount of shares s held by the same exchange member. "A unt of Shahar type bond" - An amount of Shahar type bond that s equal to the multpler of the underlyng asset of the Shahar type bond opton as long as the above amount of Shahar type bond s held by the same exchange member. "Market maker" Wthn ts meanng n the of the thrd part of the rules, who acts as market maker for share optons or Shahar type bond optons, as the case may be, and reports hs holdngs of the underlyng asset to the Stock Exchange, so that they can be taken nto consderaton n calculatng the lmtaton on hs open postons. G. The Ma'of Exchange shall debt the account of the member, through whom the clent that dgresses from the lmt on open postons acted, by an amount that s equal to the number of open postons n the clent's account at the end of the precedng tradng day n excess of the lmt, multpled by NIS 10. The General Manager of the Stock Exchange may order that the sad debt be made publc, f he concluded that the crcumstance justfy dong so. The publcaton shall nclude the partculars that the General Manager wll prescrbe

60 60 7. CLIENT S ORDERS FOR TRADING IN DERIVATIVES, SUBMITTED TO THE STOCK EXCHANGE BY MEANS OF QUOTE GENERATORS For the purposes of ths secton "Orders to turnover rato" the rato between the number of orders submtted for dervatves tradng by means of a quote generator on a certan tradng day, and the number of optons and / or futures that wll be ncluded n transactons that result from those orders on that tradng day; "A clent" a clent account of a member, ncludng a nostro account of a member; "Generator number" "Order" an dentfcaton number n the Stock Exchange tradng systems, whch the Stock Exchange assgned to a member who was gven approval by the Manager of Tradng, to permt a clent of that member - ncludng the member's nostro - (hereafter: "the clent") to transmt dervatves orders to the Stock Exchange by means of a quote generator; Includng an order to cancel or change an exstng order. a. Stock Exchange approval for the submsson of dervatves orders by means of a quote generator b. Stock Exchange approval for the submsson of dervatves orders by means of a quote generator A member shall not allow hs clent to transmt orders for dervatves to the Stock Exchange by means of a quote generator, except after the member submtted an applcaton to the Stock Exchange to be allowed to transmt orders for dervatves by means of a quote generator (hereafter: the applcaton) and after he receved a generator number from the Stock Exchange for that quote generator. The applcaton shall be submtted to the Stock Exchange on the form of the Applcaton to Submt Dervatves Tradng Orders by Means of a Quote Generator, whch s attached to these temporary gudelnes. When a member has receved a generator number for a certan quote generator from the Stock Exchange, then he shall allow the clent to act by means of the sad quote generator only on condton that the clent who acts by means of the sad quote generator mark all the orders he submts by means of the sad quote generator wth the generator number, whch the member receved from the Stock Exchange for that quote generator.

61 61 A member, who receved a generator number from the Stock Exchange for a certan quote generator, shall nform the Stock Exchange mmedately when actvty by means of that quote generator s stopped. b. Use of a generator number only for orders that orgnate from quote generators When a member has receved a generator number from the Stock Exchange for a quote generator operated by hm, then t shall be hs responsblty that through the sad quote generator dervatves tradng orders be transmtted only by means of that quote generator. A member may allow hs clent to submt dervatves tradng orders by means of more than one quote generator, on condton that the member submtted a separate applcaton n respect of each of the sad quote generators, and on condton that he receved a generator number from the Stock Exchange for every one of those quote generators. c. Orders to turnover rato The General Manager of the stock exchange may determne what the maxmum orders to turnover rato shall be. The General Manager of the stock exchange may change the sad rato from tme to tme. The General Manager of the stock exchange may, on condtons that shall be determned by t, prescrbe a maxmum orders to turnover rato, whch dffers from that prescrbed as aforesad, n respect of the quote generators that are operated by those approved by the Exchange as market makers. The General Manager of the stock exchange may change the aforesad rato from tme to tme. The General Manager of the stock exchange may also prescrbe that quote generators wll be gven a daly quota of orders, whch shall not be taken nto account for the calculaton of the aforesad rato of orders to turnover, and that on condtons that the General Manager of the stock exchange shall prescrbe. (hereafter: "the daly quota"). If whoever was approved by the Exchange as a prmary dealer for share optons operates through more than one daly quote generator, then the quota gven hm shall be dvded evenly among all the quote generators that he operates n order to make a market for share optons. If whoever was approved by the Exchange as a prmary dealer for optons on such bonds' fxed-rate non-lnked Israel government bond operates through more than one quote generator, then the daly quota gven hm shall be dvded evenly among all the quote generators that he operates n order to make a market for optons on such bonds' fxed-rate non-lnked Israel government bond. The member shall nform hs clent who deals n dervatves by means of a quote generator, that on each of the quote generators by means of whch he operates the rato between the orders transmtted by means of the quote generator on any tradng The decsons of the Board of Drectors on the restrcton of orders to turnover rato are specfed n the Chapter "Decsons of the Board of Drectors" n ths gude.

62 62 day and the number of optons and / or futures that wll be ncluded n transactons that wll result from those orders on that tradng day must not exceed the orders to turnover rato, whch the General Manager of the stock exchange prescrbed as aforesad. Decsons General Manager of the stock exchange n accordance wth ths paragraph shall be publshed at least fve tradng days before they take effect. d. Condtons for operatng a quote generator through a member A member may allow hs clent to operate through hm by means of a quote generator, on condton that the followng condtons are compled wth: 1. The member receved a generator number from the Stock Exchange for that quote generator; all the orders that wll be transmtted by means of that quote generator shall be marked wth the sad generator number; 2. The member dsposes of an nfrastructure that enables hm to check daly that the orders to turnover rato that arses out of the orders for tradng transmtted by means of that quote generator dd not exceed the rato prescrbed by the General Manager of the stock exchange. 3. The member dsposes of an nfrastructure that enables hm to dsconnect a quote generator mmedately, so that t becomes mpossble to transmt orders for tradng by means of that quote generator. e. Preparatons by the member whose clents transmt dervatves tradng orders by means of quote generators 1. Appontment of a supervsor of quote generator actvty A member whose clents transmt dervatves tradng orders by means of quote generators shall appont a staff member on hs behalf to supervse hs clents' sad actvty (hereafter: the supervsor). The supervsor shall check daly, at the end of tradng, that the rato between the number of orders transmtted by means of the any quote generator on that day and the number of optons or futures ncluded n transactons carred out and derved from those orders does not exceed the orders to turnover rato, as prescrbed by the General Manager of the stock exchange. The sad check shall be made separately for each quote generator that operates through the member. The supervsor shall nform the Stock Exchange, at ts request, of any relevant partcular that s connected to the actvty of the member's clents by means of quote generators. The member shall nform the Stock Exchange of any change n the supervsor's dentty. 2. Dsconnectng a quote generator from tradng

63 63 A member shall allow hs clent to operate by means of a quote generator, subject to the clent's certfcaton that he s aware of and agrees to the followng: a) The member wll dsconnect the quote generator, so that t becomes mpossble to transmt dervatves tradng orders by means of t, f the Stock Exchange requested that he do so; b) The member wll cancel orders that were submtted, but have not yet been carred out, f the Stock Exchange requested that he do so; c) The Stock Exchange has the rght to reject orders transmtted by means of a generator number assgned to the member for a clent who acts by means of a quote generator, f t s seen that that clent's actvty nterferes wth the orderly and far conduct of tradng on the Stock Exchange, and that even f the orders to turnover rato derved from the quantty of orders transmtted by the clent by means of the quote generator dd not exceed the orders to turnover rato, as prescrbed by the General Manager of the stock exchange. In such a case the Stock Exchange shall mmedately cancel orders that were not yet carred out and had been transmtted by the clent by means of that quote generator before t was decded to reject the orders, as aforesad. 3. Markng orders Members shall mark orders that orgnated from quote generators n the manner that wll be prescrbed by the Stock Exchange. f. Temporary cessaton of the operaton of all quotes generators The General Manager of the Stock Exchange or a person authorzed by hm may prescrbe that on all or part of a certan tradng day the transmsson of dervatves tradng orders by means of quote generators wll not be allowed, and that f unusual tradng actvty s expected on that day. Notce of the prohbton to operate by means of quote generators shall be delvered to the supervsors, who shall see to t that the quote generators are mmedately dsconnected. g. Acton the Stock Exchange may take towards a member whose clent operates by means of a quote generator 1. Rejecton of new orders and cancellaton of orders that have not yet been carred out The Stock Exchange may reject orders transmtted by a generator number, whch t allocated to a member for a clent who operates by means of a quote generator, f t s seen that that clent's actvty nterferes wth the orderly and far conduct of tradng on the Stock Exchange, and that even f the orders to turnover rato derved from the quantty of orders transmtted by the clent by means of the quote generator does not exceed the orders to turnover rato, as prescrbed by the General Manager of the stock exchange; n such an nstance, the Stock Exchange shall mmedately cancel orders that were not yet carred out and had been transmtted by the clent by means of that quote generator before t was decded to reject the orders, as aforesad.

64 64 2. Payment to the Stock Exchange Furthermore, and wthout derogatng from the provsons of subsecton 9.a. above, the Stock Exchange may collect a payment from the member, f the orders to turnover rato of the quote generator that operates through that member exceeds the sad rato, as prescrbed by General Manager of the stock exchange. In such an nstance, the member shall pay the Stock Exchange for every excess order a number of agorot decded on by the Stock Exchange Board of Drectors, plus VAT. For the purposes of ths subsecton - "Excess order" - a dervatves tradng order transmtted by the member by means of a certan generator number n excess of the number of orders that s equal to the number of optons and futures bought and sold on that tradng day by means of that generator number, multpled by the orders to turnover rato, as prescrbed by the General Manager of the stock exchange The Board of Drectors decded that the payment to the Stock Exchange shall be 6 Agorot for every excess order.

65 65 CHAPTER SEVEN: SHORT SALES 1. The perod for whch a securty s lent shall end, at the latest, on December 31 of the year after the year n whch the loan began. 2. Canceled. 3. The sale of a securty by a person who s not entered on the member's books as enttled to the securty, n accordance wth secton 7.D. of Chapter Fve of the Rules, whch s to be carred out durng the three tradng days before the record day for the rght to partcpate n a general meetng or before the record day for some beneft, shall be deemed a short sale, and the provsons of Chapter Fve of the Rules on short sales shall apply to t. 4. The sale of a securty by a person who s not entered on the member's books as enttled to the securty, n accordance wth secton 7.E. of Chapter Fve of the Rules, whch s to be carred out durng the perod prescrbed below before the record day on the rght to partcpate n a general meetng or before the record day for some beneft, as the case may be, shall be deemed a short sale, and the provsons of Chapter Fve of the Rules on short sales shall apply to t: A. In the case of Amercan Depost Recepts traded n the Unted States - 10 days; B. In the case of securtes traded n the Unted States, other than Amercan Depost Recepts - 21 days; C. In the case of other securtes traded abroad - 42 days. If the perod left between the sad declaraton or announcement and the record day or the day of the meetng, as the case may be, s less than the perods specfed above, then the sale shall be deemed a short sale from the day of the sad declaraton or announcement, as the case may be. 5. If a securty s sold as sad n secton 7.F. of Chapter Fve of the Rules, then the same quantty of the sold securtes shall be deposted n the clent's account wth the sellng member wthn the perod of tme specfed below: A. If the clent s an Israel resdent - wthn one tradng day; B. If the clent s a foregn resdent - wthn 3 tradng days. 6. If an error was made, whether by the member or by the clent, and t caused a securty to be sold short, then the member shall cover the negatve balance of the securty wthn two tradng days after the day on whch the error occurred. Notwthstandng the aforesad, the General Manager of the Exchange may take the lqudty of the securty nto account, n order to extend the perod durng whch the member wll cover the negatve balance by up to eght more days. 7. Members shall report to the Exchange short sales carred out by them and the balance of short sales for each securty, as specfed below:

66 66 A. On the frst tradng day of each week members shall report to the Exchange the short sales carred out and the balance of short sales for each securty, as of the last tradng day of the precedng week. The Exchange shall total the data on the balances of short sales for each securty, as receved from the members, and t shall publsh them. The provsons of ths paragraph shall not apply to short sale totals that resulted from errors, as sad n secton 8 of Chapter Fve of the Rules. B. On the frst tradng day of each week members shall report to the Exchange the balance of short sales for each securty, whch resulted from errors, as sad n secton 8 of Chapter Fve of the Rules and whch they dd not cover wthn two tradng days after the day on whch the error occurred, or - f the General Manager of the Exchange extended the perod wthn whch the member must cover the balance - f the balance was not covered durng the sad perod. The Exchange shall total the data on the balances of short sales that are due to errors as aforesad for each securty, whch were receved from the members, but t shall not publsh them. 8. A. A member, whose clent sold a securty short wthout havng a vald loan letter, shall be lable to a daly fne of NIS 500 for each securty n whch the clent has a sad short balance. B. A member, who dd not report to the Stock Exchange as prescrbed n secton 7. above, shall be lable to a daly fne of NIS 200 n respect of each securty for whch a clent has an unreported short sale balance. C. The fnes specfed n the above subsectons A. and B. shall be collected accordng to ther nomnal value. D. The Stock Exchange shall publsh the fact that a fne has been mposed, as specfed n the above subsectons A. and B., f the cumulatve amount of fnes mposed on the member n respect of each of the sad offenses durng the year before the fne s mposed was greater than NIS 15,000, provded that durng the perod prescrbed n the Rules the member dd not request that the matter be dscussed before a panel. The publcaton shall name the member that commtted the offense, descrbe the offense and state the amount of the fne. E. The General Manager of the Stock Exchange may order that the mposton of a fne on a member be publshed as specfed n the above subsectons A. and B., even f the cumulatve amount of fnes mposed on the member n respect of each of the sad offenses durng the year before the fne s mposed was less than NIS 15,000, and that f, n hs opnon, the crcumstances justfy dong so, provded that durng the perod prescrbed n the Rules the member dd not request that the offense, n respect of whch the fne was mposed, be dscussed before a panel. The publcaton shall nclude the partculars that the General Manager wll prescrbe.

67 67 CHAPTER EIGHT: CONDITIONS AND PROCEDURES FOR MEMBER'S OFF-EXCHANGE TRANSACTIONS IN SECURITIES LISTED FOR TRADING ON THE EXCHANGE On each tradng day a Stock Exchange member shall report separately each off-exchange transacton that was carred out through hm on that day. A sad report shall nclude the quantty of tradng unts that was carred out n the transacton and n the case of a transacton that ncludes monetary clearng through the Stock Exchange Clearng House the report shall also nclude the monetary consderaton for the transacton.

68 68 CHAPTER NINE: LT IN TRADING 1. Securtes other than dervatves A. 1) If grounds for the temporary halt of tradng n a securty arose between the closng phase and 9 AM on the followng tradng day, then tradng n the securty shall not be halted. 2) If grounds for the temporary halt of tradng n a securty arose and t was decded to halt tradng after 9 AM, but before the openng tradng phase, then the followng shall apply: a) There shall be a halt for 44 to 45 mnutes from the moment when the halt n tradng was announced (hereafter: fxed halt n tradng); f less than 45 mnutes are left untl the openng tradng phase, then the openng tradng phase for that securty shall be delayed and t shall take place after the end of the fxed halt n tradng of the securty; b) No orders shall be accepted and the theoretcal prce and turnover shall not be publshed durng the frst 15 mnutes of the fxed halt n tradng; c) Durng the next 29 mnutes of the fxed halt n tradng, orders shall be accepted, ncludng orders to cancel and to change orders submtted before the fxed halt n tradng of the securty. The theoretcal prce and volume shall be publshed durng ths nterval. d) Openng tradng shall take place at a random tme durng the 45th mnute of the tradng halt. The provsons of the above subsecton c) shall apply up to the openng tradng. 3) If grounds for a temporary halt of tradng arose and t was decded to halt tradng n a securty after the contnuous tradng phase wth that securty began, but before the pre closng phase wth that securty, then there shall be a fxed halt n tradng and the followng shall apply: a) If the fxed halt n tradng comes to an end n the course of contnuous tradng n the securty 1) No orders shall be accepted and no addtonal theoretcal prce and volume shall be publshed durng the frst 15 mnutes of the fxed halt n tradng; 2) Durng the next 29 mnutes of the fxed halt n tradng only lmt orders, stop-lmt orders and ceberg orders shall be accepted, ncludng orders to cancel and orders to change orders that had been made before the fxed halt n tradng of the securty; An addtonal theoretcal prce and an addtonal theoretcal volume of the securty shall be publshed durng ths nterval;

69 69 3) Addtonal openng tradng shall take place at a random tme durng the 45th mnute of the tradng halt (hereafter: "addtonal openng tradng"), and an addtonal openng prce shall be determned for the securty (hereafter: "addtonal openng prce"). The addtonal openng prce shall be calculated n the way the openng prce s calculated, however - Stop-lmt orders whch are submtted durng a tradng halt for whch the trgger crteron s met wth respect to the prce of the last transacton executed pror to the tradng halt shall be actvated mmedately upon submsson and shall partcpate n the Addtonal Openng tradng. - If full or partal balance between the buy orders and the sell orders was not acheved, or f no orders at all were receved for the securty, then the prce of the last transacton carred out wth that securty before the fxed halt n tradng shall be determned to be the addtonal openng prce; - If the largest tradng volume n the securty s reached at more than one prce, then the addtonal openng prce shall be the prce that s nearest to the prce of the last transacton carred out n the securty before the fxed halt n tradng. (4) In the addtonal openng tradng the prce of the securty shall be allowed to fluctuate wthout lmt. (5) After the addtonal openng prce has been determned, contnuous tradng shall be resumed. b) If the fxed halt n tradng ends durng the pre-closng phase of the securty, then the provsons of paragraphs a)(1) to (4) above shall apply; however, the addtonal openng tradng shall be postponed and shall take place at the tme of the closng tradng. c) If the fxed halt n tradng s supposed to end after the closng tradng phase of the securty, then tradng shall be halted and t shall not be resumed on that tradng day. Notwthstandng the aforesad, f tradng was halted because of the Tel Avv-25 ndex fluctuated by 8% from the base ndex of that day, then the General Manager of the Exchange or a person authorzed by hm may decde that tradng be resumed on that tradng day. B. A temporary halt n tradng a securty does not cancel orders submtted before t began. C. The General Manager of the Stock Exchange or a person authorzed by hm may extend a fxed halt n tradng and decde that t contnue for more than 45 mnutes or that t contnue untl the end of the tradng day.

70 70 If a halt n tradng was extended as aforesad, then durng that perod of tme only lmt orders may be submtted, ncludng orders to cancel or to change orders submtted before the tradng halt n that securty, and the provsons of subsecton A.3)a), paragraphs (3) to (5), and of subsecton A.3)b) and c) above shall apply. Durng ths perod the theoretcal prce and the theoretcal volume of the securty shall be publshed. D. The Drector General of the Exchange or a person authorzed by hm may determne n advance that a temporary halt n the tradng of a securty not be a fxed halt n tradng, but that t shall extend for a perod longer than 45 mnutes, or that t contnue untl the end of the tradng day. If t was decded n advance that a halt n tradng not be a fxed halt n tradng, then notce thereof shall be gven, no orders shall be accepted and no addtonal theoretcal prce and turnover shall be publshed, from the tme when notce was gven that tradng had been halted as aforesad and untl the end of the tradng day, subject to the provsons of ths secton below. If t s later decded that tradng n that securty be resumed on that same tradng day, then notce thereof shall be made publc, a fxed halt n tradng the securty shall take place from the publcaton of the notce untl tradng s resumed, and the provsons of subsecton A.3)a) above shall apply. 2. Sharp fluctuaton of the Tel Avv 25 ndex n the contnuous tradng phase A. 1) If the Tel Avv 25 ndex changed by more than 8%, but by less than 12%, from the basc ndex on that day, then the General Manager of the Stock Exchange or a person authorzed by hm shall stop tradng n shares, n securtes convertble nto shares, n ETN's for whch the underlyng asset s a share basket ndex, n dervatves of shares and n dervatves of share ndexes for a perod of 45 mnutes that shall begn wth publcaton of the notce of the stoppage. The provsons of subsecton 1) shall not apply on a day on whch a crcut breaker was actvated at the pre-openng tradng phase. 2) If tradng was stopped durng the contnuous tradng phase accordng to subsecton 2.a.1) above, and f after tradng was resumed the rate of change from the basc ndex declned and then agan rose to 8% or more n the same drecton, then tradng shall not be stopped a second tme because of a change of less than 12% n the Tel Avv 25 ndex, compared to the basc ndex on that day. 3) a) If the Tel Avv 25 ndex changed by 12% or more from the basc ndex on that day, then the General Manager of the Stock Exchange or a person authorzed by hm shall stop tradng n shares, n securtes convertble nto shares, n ETN's for whch the underlyng asset s a share basket ndex, n dervatves of shares and n dervatves of share ndexes untl the end of the tradng day. b) Notwthstandng the aforesad, the General Manager of the Stock Exchange may, n consultaton wth the Charman of the Board of

71 71 Drectors, resume tradng on the same tradng day, f t s hs opnon that under the crcumstances there s justfcaton for dong so. When the decson to resume tradng has been made, the General Manager of the Stock Exchange may decde to change the tradng schedule and notce thereof shall mmedately be made publc on the nformaton dstrbuton systems of the Stock Exchange. A sad resumpton of tradng may be after less than 45 mnutes elapsed snce the notce of the tradng halt had been made. B. If tradng was stopped durng contnuous tradng n accordance wth subsecton 2.a. above, then the General Manager of the Stock Exchange may, n consultaton wth the Charman of the Board of Drectors, stop tradng also n other securtes that are traded on the Stock Exchange. C. If tradng was stopped n accordance wth subsecton 2.a.3) above, then tradng shall not be stopped because of a sharp fluctuaton of the Tel Avv 25 ndex, as sad n subsecton 2.a. above, on the day after the day on whch tradng was stopped as aforesad, D. If tradng was stopped as aforesad, then a notce about t shall be publshed mmedately over the Stock Exchange nformaton dstrbuton system.

72 CHAPTER TEN: PUBLICATION OF TRADING DATA At the end of each tradng day and before the next tradng day begns the Stock Exchange shall publsh the tradng data on ts Internet ste whch, nter ala, shall nclude the followng partculars: A. Data on the securtes lsted for tradng on the Exchange, ncludng the name of the securty, the number of the securty, the closng prce and the volume; B. The tradng volume for each securty separately, not ncludng Off-Exchange transactons; C. Off-Exchange transactons; D. The followng partculars shall also be publshed n respect of every dervatve: name of the dervatve, number of the dervatve, closng prce, volume n unts, the NIS volume and the number of postons open on the precedng tradng day; E. The total volume of transactons wth shares and bonds carred out on the Exchange on that day; F. Addtonal partculars and tradng data, as the Board of Drectors or a person from tme to tme authorzed by t shall prescrbe. The provsons of ths secton shall not apply to nsttutonal securtes. 2. The followng nformaton shall be dstrbuted through the Exchange nformaton dstrbuton system: A. Informaton on each of the securtes, other than dervatves: 1) The openng prce and the tradng volume at the openng prce shall be publshed n the course of the phase of tradng; 2) The theoretcal prce and the theoretcal volume; 3) The amount of orders submtted at each of the prce levels that are top prorty for carryng out, both for bd and for ask to be prescrbed by the General Manager of the Stock Exchange from tme to tme. Notce of a change of the prce levels number shall be publshed by the Stock Exchange at least thrty days n advance. For ths purpose, for ceberg orders only the vsble volume shall be dsplayed and stop-lmt orders wll only be dsplayed followng ther trggerng. 4) The prce of the last transacton carred out and the tradng volume of the last transacton carred out, and also the total tradng volume of the securty, n terms of quantty and of NIS volume;

73 73 5) The hghest prce and the lowest prce at whch a transacton was carred out throughout the entre tradng day; 6) The theoretcal closng tradng prce and the theoretcal closng tradng volume; 7) The closng tradng prce and the closng tradng volume; 8) The closng prce and total demand or total supply at the closng prce; 9) Notces of halts n tradng, of fxed halts n tradng and a precs of the grounds for the halt n tradng; 10) The phase of tradng whch the securty has reached. 11) Pre-arranged orders, whch wll be marked wth a specal symbol. B. Informaton for each of the dervatves 1) The amount of orders submtted at each of the prce levels that have the hghest preference for mplementaton, both for bd and for ask, to be prescrbed by the General Manager of the Stock Exchange from tme to tme. Notce of a change of the prce levels number shall be publshed by the Stock Exchange at least thrty days n advance. 2) The base prce. 3) Pre-arranged orders, whch wll be marked wth a specal symbol. C. General nformaton 1) Calculated ndces; 2) Tradng volumes of all securtes; 3) Notces of changes n the tradng schedule, f any; 4) Specal announcements.

74 74 CHAPTER ELEVEN: CANCELLATION OF TRANSACTIONS, DUE TO TECHNICAL MALFUNCTIONS OR TECHNICAL ERRORS 1. In these Rules "Erroneous transacton" a transacton on the Exchange, n whch at least one of the orders that were part to ts mplementaton was an erroneous order. 2. The General Manager of the Stock Exchange or a person authorzed by hm shall cancel a transacton wth a securty, f he s satsfed that a member erred n respect of the prce lmt n the order for dervatves or other securtes that he submtted for mplementaton on the Exchange durng the contnuous tradng phase, because of techncal malfuncton or a techncal error, on condton that all the followng condtons have been met: a. The prce of the erroneous transacton dffers from the prce of the last transacton carred out wth that securty before the erroneous order was submtted, or from the base prce of that securty, f no transacton wth that securty was carred out on that day before the erroneous transacton, by the followng percentages: In respect of shares ncluded n the TA-25 ndex by at least 6%; n respect of shares not ncluded n the TA-25 ndex and n respect of convertble bonds by at least 12%; In respect of bonds by at least 4%; In respect of M.K.M. by at least 2%; In respect of call (001) optons and futures by at least 4%; In respect of other dervatves by at least 20%; Notwthstandng the aforesad, f the erroneous transacton was carred out n respect of an opton and f no transactons were carred out wth that opton before the erroneous transacton, or f the General Manager of the Stock Exchange or the person he authorzed holds that the prce of the last transacton carred out before the erroneous transacton does not reflect the economc value of the opton, as t was when the erroneous transacton was carred out, then the dgresson shall be determned n relaton to the economc value of the opton, whch shall be calculated accordng to the Black and Scholes formula; b. The amount of the damage caused by the erroneous transacton (hereafter: the damage) s not less than NIS 50,000; The damage shall be calculated by the General Manager of the Stock Exchange or by a person he authorzed accordng to the dfferental between the erroneous transacton prce and the prce of the last transacton carred out wth the securty before the erroneous transacton, or between t and the base prce of that securty, f no transacton wth that securty was carred out on that day before the erroneous transacton, or between t and the economc value sad n subsecton a. above, as the case may be, multpled by the quantty of securtes n that transacton; If several erroneous transactons were carred out n consequence of the erroneous order, then the damage that was caused shall be calculated as the total of damages caused by all the erroneous transactons;

75 75 c. The member nformed the Stock Exchange of the erroneous transacton as soon as possble and not later than twenty mnutes after the erroneous transacton was carred out; In addton to the sad notfcaton, the member transmtted to the Stock Exchange, as soon as possble and not later than forty mnutes after the erroneous transacton was carred out, a wrtten request, sgned by the member's authorzed sgnatory, that the erroneous transacton be canceled; the request shall be formulated as the Board of Drectors shall decde from tme to tme. Ths secton 2 does not apply to covered warrants. 3. Members are enttled to submt an applcaton to cancel a transacton up to thrty mnutes after tradng n the securty came to an end. When the member's sad request to cancel the erroneous transacton s receved, the fact that a request to cancel the sad transacton was receved shall be made publc over the Stock Exchange nformaton dstrbuton system. The Stock Exchange shall, as far as possble, nform the member that s the other party to the erroneous transacton that the transacton may be canceled. 3A. The decson of the General Manager of the Stock Exchange whether to cancel the transacton shall be made untl the begnnng of the next followng tradng day after the day on whch the transacton was carred out. 4. a. When t s decded to cancel the erroneous transacton, the members that are partes to the transacton shall be gven notce of the cancellaton of the transacton. b. Whle a transacton s beng cancelled, tradng may be halted for a short nterval. Durng ths nterval, orders n respect of securtes cannot be submtted or cancelled. c. Notce that an erroneous transacton was cancelled shall be made publc over the Stock Exchange nformaton dstrbuton system. If t was decded to cancel an erroneous transacton at the request of both buyer and seller, then the fact that the request was made by both buyer and seller shall be made publc. d. A decson to cancel an erroneous transacton shall be drawn up n wrtng mmedately after t was adopted, and t shall be sgned by the person authorzed to cancel the transacton. 5. a. If t was decded not to cancel an erroneous transacton, then notce that t was decded not to cancel the transacton shall be gven to the member who requested that the transacton be cancelled and as far as possble also to other members that were partes to that transacton. b. Notce of a decson by the Stock Exchange not to cancel the transacton shall be made publc over the Stock Exchange nformaton dstrbuton system.

76 76 6. A member who submtted an applcaton to cancel a transacton shall pay NIS 1,500 plus VAT, to the Stock Exchange. If the Stock Exchange approved the member's applcaton the member shall pay the Stock Exchange an addtonal NIS 8,500, plus VAT.

77 CHAPTER TWELVE: MARKET MAKERS 77 Qualfcatons of market makers and oblgatons of market makers 1. If a member wshes to act as market maker, then he shall submt an applcaton to the Exchange, formulated as specfed n Schedule One. If whoever wshes to act as market maker s not a member, then he shall submt an applcaton, as specfed n Schedule Two, to the member through whom he proposes to act as market maker. The member, through whom the market maker acts, shall submt an applcaton to the Exchange as specfed n Schedule Three. 2. a. Whoever wshes to act as market maker for securtes, not ncludng dervatves, shall assume an oblgaton that he wll act as market maker durng a perod of not less than one year, and that he wll submt market makng orders to the Stock Exchange as requred. Whoever wshes to act as market maker for dervatves, shall assume an oblgaton that he wll act as market maker for dervatves durng a perod not shorter than what the Board of Drectors wll prescrbe, and that he wll submt market makng orders to the Stock Exchange as requred. b. Notwthstandng the aforesad n subsecton 2.a.,, n the nstances specfed below a market maker may cease makng a market for a securty, even f the perod prescrbed n subsecton 2.a. above has not yet passed, on condton that he sent a wrtten applcaton to the Stock Exchange (hereafter: "the applcaton") and the General Manager of the Stock Exchange or a person authorzed by hm approved the applcaton and the date on whch market makng for the securty wll cease: 1) Another market maker began to make a market for the securty; 2) The securty for whch a market s beng made was ncluded n the man lst when makng a market for t began, and later the securty was moved to be traded on the small captalzaton lst; 3) At least fve contnuous tradng days passed, the last of them on the day before the applcaton was receved by the Stock Exchange, on whch the closng prce of the securty was ten agorot or less. c. Notwthstandng the provsons of subsecton 2.a., the General Manager of the Stock Exchange or a person authorzed by hm may approve an applcaton by a market maker to cease makng a market for a securty or to cease dong so durng a set perod, even f the perod prescrbed n subsecton 2.a. above has not yet passed, and that f nformaton was made publc n any way whatsoever about a change for the worse n the company's busness condton or other substantve nformaton that relates to the company, ncludng ts controllng members, or to the securty for whch the market was beng made.

78 78 When the General Manager of the Stock Exchange or a person authorzed by hm decdes to approve that market makng cease under any of the crcumstances specfed above, then n hs decson the General Manager shall set the date on whch the cessaton n market makng shall go nto effect, as well as the condtons thereof. d. If the market maker ceased to comply wth any of the condtons prescrbed n secton 5 of Chapter Nne n of the thrd part of the rules, n respect of the securty for whch he makes a market, then the market maker shall cease makng a market for the securty twenty-one days after he sent the Stock Exchange a wrtten notce that he has ceased to comply wth any of the sad condtons. e. The grounds for ceasng to make a market shall be ncluded n the notce of the Stock Exchange about the cessaton n makng a market for the securty. 3. A market maker s exempt of submttng market makng orders for executon on the Exchange when one of the followng occurs, and that durng the perods specfed below: A. A techncal malfuncton occurred and because of t the marker maker cannot transmt orders to the Exchange - as long as the malfuncton exsts; when a sad techncal malfuncton occurred, then the Exchange member through whom the market maker operates shall nform the Exchange mmedately after t was found; the sad Exchange member shall nform the Exchange mmedately after the malfuncton has been repared; B. Tradng n the securty for whch market makng s carred out, or n the underlyng asset of the securty for whch market makng s carred out was suspended or stopped - as long as the stop n tradng or the suspenson of tradng s n effect, as the case may be; C. For a market maker n shares, n securtes convertble nto shares, n share dervatves and n share ndex dervatves - on a day on whch tradng was temporarly stopped because of an 5% fluctuaton n the TA-25 ndex; D. If the Exchange was closed - on the frst day on whch tradng on the Exchange s renewed after t had been closed; E. For a market maker n shares, n securtes convertble nto shares, n share dervatves and n share ndex dervatves - on the tradng day after the day on whch tradng was stopped because of a 12% fluctuaton of the TA-25 ndex or of the last theoretcal TA-25 ndex; F. n respect of dervatves, other than futures on hypothetcal debentures on days on whch tradng n the underlyng asset does not take place; G. n respect of futures on hypothetcal debentures on days on whch tradng n the underlyng asset does not take place and on days on whch foregn currency exchange rates are not set by the Bank of Israel; 3A. A company must not act as market maker for securtes ssued by t, by a body corporate that controls t, or by a body corporate controlled by ts controllng member. The provsons of ths secton shall not apply to market makng for ETN's, ncludng complex certfcates.

79 79 3B. A market maker for securtes shall be a member or a subsdary of a member. The provsons of ths secton shall not apply to market makng for dervatves and ETN's, ncludng complex certfcates. Examnaton whether market makers meet ther oblgatons n respect of market makng orders and the condtons of ther qualfcaton 4. At least once a month the Exchange shall produce a report on the actvty of the market makers. Cessaton of actvty as market maker 5. When the mnmum perod, n respect of whch a market maker assumed the oblgaton to act as market maker for a securty or a dervatve has passed, then the market maker may stop makng a market for the securty or the dervatve, as the case may be, on condton that he so nformed the Stock Exchange n advance and n wrtng at least 21 days before the date on whch he wll cease to act as market maker for the securty. Cancellaton of approval to act as market maker 6. The General Manager of the Exchange shall cancel the approval to act as market maker, whch was granted to whoever faled - on two successve tradng days or n the course of sx tradng days durng a perod of sx consecutve calendar months - to meet the oblgatons he assumed on the matter of submttng market makng orders. 7. Whoever had the approval granted hm to act as market maker for a securty cancelled because he faled to meet the oblgatons of a market maker, shall not have the rght to act agan as market maker for that securty durng the perod of one year after the approval was cancelled as aforesad. Publcaton 8. The Exchange shall publsh the nformaton specfed below: A. A lst of market makers for each of the securtes; B. A notce that a market maker has begun to operate, specfyng the securtes n respect of whch he acts as market maker; C. A notce that a market maker's actvty has ceased; D. A notce that market makng n respect of a certan securty was begun by a market maker and a notce that market makng n respect of a certan securty has ceased; E. Addtonal partculars to be prescrbed by the Board of Drectors.

80 CHAPTER THIRTEEN: INSTITUTIONAL SECURITIES Defntons "Insttutonal nvestors" - nvestors wthn ther meanng n secton 15A(b)(1) and (2) of the Law; "Varable nterest" nterest, the rate of whch changes from one payment to the next, or the nterest of whch s determned accordng to parameters, the sze of whch s not known at the tme of ssue; "Fxed nterest" nterest that s not varable nterest; "Unequal redemptons" redemptons, the amounts of whch vary from one redempton to the next. 2. Condtons of nsttutonal securtes An ssung company shall set the condtons specfed below for ts nsttutonal securtes: A. An early redempton date shall not occur between the determnng date for an nterest payment and the date on whch t s actually pad. B. 1) When the redempton date arrves, the redempton and the nterest payment shall be carred out at the same tme; 2) f redempton and an nterest payment are set for a day that s not a tradng day, then the redempton date and the nterest payment shall be postponed to the next followng tradng day; When redempton and an nterest payment have been postponed as aforesad, then no nterest shall be pad n Consderaton of ths postponement and the "cum" date shall not be changed for ths reason; 3) The determnng day for the determnaton of the rght to redempton or to nterest (the "cum" day) shall be 12 days before the day of the redempton and of the nterest payment; 4) For purposes of ths subsecton, "redempton" ncludes partal redempton and early redempton. C. When partal redempton s made, accrued nterest shall be pad. D. At the fnal redempton, there shall be no "ex nterest" or "ex redempton" and payment shall made be aganst surrender of the certfcate.

81 81 E. In respect of convertble debentures that are redeemed n nstallments, no converson shall be carred out from four days before the determnng date for a partal redempton untl the partal redempton s carred out. However, f the last converson date before a partal redempton falls on day on whch no tradng s carred out, then the converson date shall be postponed to the frst followng tradng day. F. The last converson date of convertble debentures shall be fourteen days before the fnal redempton date. However, f the last converson date s set for a day that s not a tradng day, then the converson date shall be postponed to the frst followng tradng day. G. 1) If the condtons of certan debentures prescrbe fxed nterest, then the nterest payments shall be calculated accordng to the number of payments per year, but the frst nterest payment shall be calculated n respect of the perod from the day of allocaton of the debentures untl the frst payment date, the perod beng calculated on the bass of 365 days per year. 2) If the condtons of certan debentures prescrbe fxed nterest at a rate below 0.5% per annum, then the company may prescrbe that the nterest not be pad on an annual bass, and that the nterest shall accrue on the bass of compound nterest untl the nearest payment date; however, the company may prescrbe n the condtons of the debenture that, when nterest has accrued to an amount of at least 2.5%, then the company shall pay the accrued nterest before the nearest payment date. H. In connecton wth nsttutonal securtes, the followng terms shall have the meanng specfed here: 1) The known exchange rate - the representatve exchange rate of a foregn currency on a certan day, whch the Bank of Israel set before that day; however, durng a perod n whch the Bank of Israel does not set representatve exchange rates, the exchange rate last set by the Mnster of Fnance together wth the Governor of the Bank of Israel for Government Bonds lnked to that foregn currency shall be the known exchange rate; 2) The basc exchange rate - the known exchange rate on a certan day determned by the company; the basc exchange rate shall be stated among the condtons of nsttutonal securtes; 3) The payment exchange rate - the known exchange rate two days before the day of payment, unless there s a dfferent provson n the condtons of the securty; 4) The known ndex - the last ndex that s known; 5) The basc ndex - the known ndex on a certan day determned by the company; the basc ndex shall be stated among the condtons of nsttutonal securtes; 6) The payment ndex - the known ndex on the day of payment, unless there s a dfferent provson n the condtons of the securty.

82 82 7) The converson day - the day, on whch the Stock Exchange Clearng House receved notfcaton from an exchange member about the converson of the debentures; for ths purpose, any notfcaton receved by the Clearng House after 12 o clock at noon shall be treated as f t had been receved on the followng tradng day. I. If the company dstrbutes bonus shares durng the perod n whch the rght exsts, and f t decdes to conserve the rght of the holders of convertble debentures, then the rghts of the holders of convertble debentures shall be conserved n the followng manner: Immedately after the determnng date, the number of shares due to converson, to whch holders of convertble debentures wll be enttled upon ther converson, shall be ncreased by addng the number and category of shares to whch holders of convertble debentures wll be enttled as bonus shares upon converson, f they convert ther debentures on the determnng date. J. If, durng the perod n whch the converson rght s n effect, the company offered securtes to share holders by way of rghts, and f t decdes to preserve the rghts for holders of convertble debentures, then the company shall act n one of the followng manners: 1) It may offer the same securtes to holders of convertble debentures on terms dentcal wth those of the offerng to share holders, and the convertble debenture holders shall be treated as f they had converted the debentures on the determnng date; 2) The number of shares that result from the converson of convertble debentures shall be adjusted for the beneft component of the rghts, as expressed by the rato between the prce of the share on the Exchange on the determnng date and ts basc prce ex rghts. K. Varable nterest and unequal redemptons may be prescrbed n the condtons of certan debentures, subject to the followng condtons: 1) The Tradng Manager may refran from approvng the tradng of debentures on the tradng system for nsttutonal, f n hs opnon clearng the debentures wll requre the nsttuton of specal operatonal arrangements; 2) No more than one nterest payment and one redempton wll take place each month; 3) If the condtons of the debenture prescrbe an nterest payment or redempton each month, then the payment shall be carred out on the same date of each month; 4) Notce of the precse amount of nterest to be pad and of the redempton shall be gven to the Stock Exchange at least four days before the determnng date for the payment, as prescrbed by the company.

83 83 Notwthstandng the aforesad, the Manager of Tradng may allow seres of nsttutonal securtes allocated before May 1, 2005, to be traded on the nsttutonal tradng system, and that even f the ssung company dd not set some or all of the aforesad condtons n the condtons of the securtes. 3. Regstraton fees on nsttutonal tradng system and annual fee A company, the nsttutonal securtes of whch are traded on the nsttutonal tradng system, shall pay the followng regstraton fees on nsttutonal tradng system and annual fee as specfed below: A. Regstraton fees on nsttutonal tradng system (as a percentage of the nomnal value regstered for nsttutonal tradng system) 1) n respect of a seres of debentures and convertble debentures 005% mnmum: NS 2,806 maxmum: NS 50,638 2) n respect of a seres of commercal securtes 0.001% mnmum: NS 509 maxmum: NS 10,177 3) Regstraton fees for securtes, whch wll result from the exercse of optons that may be exercsed n respect of nsttutonal securtes, wll be collected when the optons are exercsed. In nstances n whch the sad optons are exercsed over a perod of tme, the followng shall apply: If the mnmum fee for lstng for tradng (hereafter: the mnmum amount ) s equal to or hgher than the regstraton fee, whch would have been collected f all the securtes of that seres were exercsed on the same date - then a regstraton fee equal to the mnmum amount shall be collected when the rghts are exercsed for the frst tme, and no addtonal regstraton fees wll be collected for any addtonal exercse of securtes of the same seres; If the mnmum amount s lower than the regstraton fee, whch would have been collected f all the securtes of that seres were exercsed on the same date, then - when the rght s frst exercsed - the company may pay the regstraton fee for exercsng all the securtes of that seres, or t may pay - on each exercse date - the regstraton fee accordng to the number of securtes exercsed at that tme, on condton that the regstraton fee collected at each sad exercse not be less than the mnmum amount. The aforesad regstraton fees wll not be collected for the regstraton of a seres of nsttutonal securtes, for whch a clearng regstraton fee was pad to the Clearng House under Part Sx of the By-laws;

84 84 B. 1) When convertble debentures and commercal securtes, the condtons of whch nclude an exceptonal condton (such as the currency of lnkage, the manner of payment, and so forth) are frst regstered, then the regstraton fee shall nclude a one tme fee of NIS 16,358 n addton to the regstraton fee specfed above. 2) When debentures, the condtons of whch prescrbe more than three unequal redemptons, f they prescrbe varable nterest, or f they prescrbe more than three unequal redemptons and varable nterest, then the regstraton fee shall nclude the amounts specfed below, and that n addton to the regstraton fee specfed above. For purposes of ths subsecton "Varable nterest" "Unequal redemptons" - Interest, the rate of whch changes from one payment to the next, or the rate of whch s determned accordng to parameters, the sze of whch s not known at the tme of ssue; - Redemptons, the amounts of whch vary from one redempton to the next. a) In respect of debentures, the condtons of whch prescrbe one or several of the followng condtons, the regstraton fee shall also nclude a one tme payment of NIS 12,000: Varable nterest; More than three but not more than twelve unequal redemptons. b) In respect of debentures, the condtons of whch prescrbe more than thrteen but not more than forty unequal redemptons, the regstraton fee shall also nclude a payment of NIS 1,200 for each redempton (hereafter: "addtonal payment"), and that subject to the followng provsons: The total of addtonal payments shall not exceed NIS 40,000; f the condtons of the debenture also nclude varable nterest, then the regstraton fee shall also nclude a payment of NIS 1,200 for each nterest payment that does not occur on the date of a partal or fnal redempton. c) In respect of debentures, the condtons of whch prescrbe more than forty unequal redemptons, the regstraton fee shall also nclude a payment of NIS 1,500 for each redempton (hereafter: "addtonal payment"), and that subject to the followng provsons: - The total of addtonal payments shall not exceed NIS 120,000; - If the condtons of the debenture also nclude Varable nterest, then the regstraton fee shall also nclude a payment of NIS 1,500 for each nterest payment that does not occur on the date of a partal or fnal redempton.

85 85 C. An annual fee of NIS 2,532 for each seres. The fee shall be pad for the perod n whch the seres was lsted for tradng, partly n the calendar year n whch the seres was regstered and partly n the calendar year n whch the fnal redempton takes place. D. The above tarffs shall be lnked to the ndex. The amounts sad above nclude lnkage dfferentals up to and ncludng November 2005, and they shall be updated once a year.