Income Tax Ordinance [New Version]

"election" — an election by an employing company of one of two tax tracks for the allotment of shares to employees through a trustee, namely the employment income track or the capital gain track;

"controlling shareholder" — as defined in section 32(9);

"allotment of shares through a trustee" — an allotment of shares of an employing company to an employee, provided that the employee is not a controlling shareholder therein at the time of the allotment or as a result thereof and all of the following conditions are met:

"employing company" — any one of the following:

"exercise date" —

"share" — including a right to purchase a share;

"share listed for trading on a stock exchange" — including a share in a company whose shares, all or some of them, are listed for trading on a stock exchange in Israel or outside Israel;

"trustee" — a person approved by the assessing officer as a trustee for the purposes of this section, including an employee;

"employee" — including an office holder in a company, but excluding a controlling shareholder;

"benefit value" — the consideration or the value at the exercise date, less expenses incurred by the employee in acquiring the share as adjusted from the date of expenditure to the exercise date, as well as expenses incurred by the employee in respect of the sale;

"end of the period" — any one of the following:

In this Part —

every term shall have the meaning it has in Part 5 or in the Land Taxation Law, as the case may be, unless this Part contains another express provision;

"merger" —

"asset" — any property, whether real property or movable property, and any right or benefit, contingent or vested, whether in Israel or outside Israel;

"merger order" — an order made pursuant to section 351 of the Companies Law;

"merger date" —

"approved merger" — a merger that the court approved pursuant to section 321 of the Companies Law, or a merger that pursuant to a court decision under section 319 of the Companies Law may not be delayed or prevented from being carried out at the time fixed by the court;

"required period" —

"chain of mergers" — one or more additional mergers (hereinafter — additional merger), in which a company that participated in a previous merger participates, carried out during the required period of the previous merger, provided that the following two conditions are met:

"related party", in relation to a body of persons (in this definition — corporation), or in relation to an individual — a person in whom any one of the following applies:

"right in a body of persons" — a right in a body of persons that confers any of the rights listed below, granted whether under the constitutional documents of the body of persons or pursuant thereto or under an agreement with a member of the body of persons:

"trust fund" — (Repealed)

"provident fund" — (Repealed)

"split" — the transfer of assets and liabilities of a company (hereinafter — the splitting company) to another company or to a number of other companies (hereinafter — the new company);

"capital reduction order" — (Repealed)

"market value" — the amount that could have been obtained in a sale from a willing seller to a willing buyer between whom no special relationships exist;

"involuntary sale" — a sale that is one of the following:

"stock exchange" — (Repealed)

"regulated market" — (Repealed)

"controlling shareholder" — as defined in section 3(i)(1)(c);

"restructuring" — a merger, split or transfer of assets in consideration for shares, all pursuant to this Part.