Companies Law, 5759-1999

In a public company and in a private company that is a bond company, the proportion of independent directors shall be as set out below, as the case may be:

In the appointment of a director in a public company and in a private company that is a bond company, the composition of the board of directors shall be diversified having regard to the gender of the candidate, in addition to the obligation to diversify it having regard to the knowledge and experience of the candidate, in accordance with the special needs of the company.

In a public company and in a private company that is a bond company, persons who are subordinate to the general manager, directly or indirectly, shall not serve as directors, except for a director who is an employees' representative, if an employees' representation exists in the company; a director in a corporation controlled by a public company or a private company that is a bond company may serve as a director in that company.

The board of directors of a public company and the board of directors of a private company that is a bond company shall hold, at least once a year, a discussion on the management of the company's business by the general manager and the office holders subordinate to him, without their presence, after they have been given an opportunity to express their position.

The audit committee shall hold, at least once a year, a meeting on the subject of deficiencies in the business management of the company, in the presence of the internal auditor and the auditing accountant, and without the presence of office holders in the company who are not members of the committee, after they have been given the opportunity to express their position.

Notwithstanding the provisions of section 239(b), external directors in a public company shall be appointed at the general meeting by a majority of votes, provided that all of the following conditions are met:

"connected or competing shareholder" means the shareholder who proposed the appointment or a substantial shareholder, in each case if, at the time of appointment, that shareholder, a controlling shareholder thereof, or a company controlled by either of them has business connections with the company, or if that shareholder, a controlling shareholder thereof, or a company controlled by either of them is a competitor of the company; the Minister, in consultation with the Securities Authority, may prescribe that certain matters, subject to conditions prescribed by the Minister, shall not constitute a business connection with the company or competition therewith;

"affiliation" has the meaning assigned to it in section 240(b), and the Minister may, in consultation with the Securities Authority, prescribe that certain matters, subject to conditions prescribed by the Minister, shall not constitute an affiliation.

"contractor employees employed by the company" means employees of a manpower contractor in respect of whom the company is the actual employer, and employees of a service contractor employed in providing a service at the company; for this purpose, "manpower contractor", "service contractor" and "actual employer" have the meanings assigned to them in the Employment of Employees by Manpower Contractors Law, 5756-1996;

"wage cost" means any payment in respect of employment, including employer contributions, payments in respect of retirement, a vehicle and the costs of its use, and any other benefit or payment;

A purpose whose subject matter is one of the following:

In this Schedule —

"tradeable bond" means a bond traded on a stock exchange;

"rating" means a debt rating in Israel determined by a rating company as defined in the Regulation of Credit Rating Companies Activities Law, 5774-2014;

"investment method" includes the investment period;

"investment adviser" and "portfolio manager" have the meanings assigned to them in the Regulation of Investment Advisory and Portfolio Management Law, 5755-1995;

"foreign currency" has the meaning assigned to it in the Bank of Israel Law, 5770-2010;

"issuer" means a corporation that has issued securities, excluding the State of Israel;

"mutual funds" means joint investment funds in trust as defined in the Joint Investment Trust Law, 5754-1994.

The board of directors of a foundation that has surplus funds in an amount exceeding NIS 30 million, or of a foundation whose articles of association so provide, shall appoint an investment committee (hereinafter — the investment committee).

A member of the investment committee owes the foundation a duty of care and a duty of loyalty as referred to in sections 252 and 254, and is entitled, for the purpose of performing the member's function, to receive information and to engage advisers as referred to in sections 265 and 266, as if the member were an office holder of the company, with the necessary modifications.

The investment committee shall convene at least once per quarter, unless the board of directors has approved convening at a different frequency of not less than twice a year; the committee shall determine its working procedures with the approval of the foundation's board of directors, and shall transmit to the board of directors the minutes of its deliberations and also, once a year, a report on its activities; decisions of the investment committee shall be adopted by a majority of the votes of the members present.

A foundation that has acted for the purpose of investing surplus funds through or with the assistance of another, including a portfolio manager, investment adviser or investment committee, shall not pay management fees, expenses or remuneration out of the company's assets at a rate exceeding 0.5 per cent per year of the total surplus funds available for investment in that year.