Dear Employees
In the course of business we encounter daily ethical dilemmas that we must resolve.
With this in mind, we present you with the Code of Ethics of Danshar (1963) Ltd. Our
intention is that it will serve a practical guide how to contend with challenges and
resolve ethical dilemmas encountered routinely in the course of our work.
The Code of Ethics provides us with a set of ethical standards, creates a uniform
language and defines what the proper ethical conduct is, and what transgresses from it.
Over the years, Danshar (1963) Ltd. has gained an impressive reputation for its integrity
and business culture, making it the duty of each and every one of us to nurture this
reputation and protect it.
No codex can answer all the questions that may arise nor can it cover all the situations
that may occur in the course of our current business and future events. Nonetheless,
when a question of conduct does arise, this document should be thoroughly read and
consulted with regard to the Company’s values.
When uncertain or in doubt we ask you to approach the person you report to directly or
if necessary, to the internal controller for advice and personal instruction as to what
your correct course of action should be.
Sincerely,
Yoel Adler
General Manager Danshar (1963) Ltd.
Danshar (1963) Ltd. – Code of Ethics
Between Us
 We must behave responsibly and with dedication even when working
passionately. We are committed to decency and to fulfilling our commitments
and take full responsibility for our actions.
 We are committed to creating a team of excellence where each member
contributes to our success. We see ourselves as a community where mutual
respect, trust, integrity and cooperation are shared by everyone. We thrive
through integrity and exchange ideas in a spirit of responsiveness and
acceptance.
 We are committed to provide our employees a work environment that is free
from threats or violence. We will not accept any form of harassment including
sexual, physical, mental harassment or based on religious beliefs, origin or
customs. We will not accept any form of persecution for any reason.
 The Company has adopted a codex with regard to sexual harassment according
to which, jointly with the Company regulations, we expect our employees to
conduct themselves. The codex has been distributed to the employees and a
copy is available for reference in the Human Resources department. The
Company expects employees to help maintain a healthy, hygienic and safe
environment and abide by the safety regulations.
 The Company employees enjoy trust, respect and decent treatment. The
Company is committed to provide employees a good, pleasant and safe work
environment that encourages inspirational ideas and creative thought that
promotes cooperation, while considering the benefit of the Company, its
customers and our environment.
Our Customers and Us

We are committed to the satisfaction of our customers. We will adhere to the
most proper behavior and respectfully represent the Company towards our
clientele.

Our quality performance will be the reason for customers to choose and prefer
us over the competition. We are committed to the highest standards of our
Company’s products and will continue to invest efforts to improve them.

Relations with our customers are based on respect, integrity, professionalism
and mutual trust.

We are committed to create quality products for our customers and end-users.
The internal control system implemented by the Company is designed to
guarantee adherence to internal standards and relevant regulations. We act to
contribute to these standards through the highest quality of work.

We care for the safety of our customers when using our products. It is our
highest priority and true commitment.

We are committed to comply with the proper requirements for marking
products wherever we operate and guarantee that the product description
will be sufficient and answer the needs of our clientele.
Company Assets and Us
 We are committed to protecting our Company assets as part of our efforts to
create long-term value for our shareholders. Employees must use Company
assets responsibly, maintain them and use them properly for the benefit of the
Company.
 It is the employees’ duty to protect all the Company and manufacturing assets
including intellectual property. Improper use of the Company assets including
the intellectual property constitutes a breach of this code of ethics and may be
considered unlawful, with significant consequences on the working relationship
and may result in lawful civil or criminal action.
 Business, technical and private intellectual property pertaining to Company
employees, customers and suppliers is considered confidential and must be
protected.
 Misappropriation, neglect and wastefulness of Company property constitute
damage to the Company. Any suspicious conduct or transgression by a Company
employee must be reported to his mangers for proper investigation.
Collaboration with internal control systems: the Company manages and enforces
an effective system of internal control to protect its assets and its intellectual
property as well as the assets of its customers, suppliers and shareholders.
Company employees must collaborate with the aforementioned control systems.
Any transaction is subject to authorization from the appropriate executive level
according to its subject matter, scope and nature. All the employees who are
authorized to sell or purchase assets on behalf of the Company, including
persons authorized to make commitments on behalf of the Company, must do so
responsibly, and with reasonable discretion as lawfully required and in
accordance with Company regulations, and may not exceed the scope of their
authorization.
 All directors, officers in the Company and employees must refrain from any
relationships and interests that conflict or may be deemed to conflict with the
welfare of the Company. Employees will not exploit their position for any
personal matter that is not related to their work and will decline any gifts and
benefits whatsoever. Additionally, employees will avoid taking advantage of a
business transaction for personal gain and benefit.
 We regard to the strict management and maintenance of records with utmost
importance, the Company expects its employees to register and report all
information properly and accurately. Records include among others, reports and
documents with regard to the Company activity that are intended for internal
use and for transfer to third parties. All the books, reports, declarations and
financial records must be managed lawfully and in accordance with the internal
control regulations. Company records must be archived properly for a minimum
of seven years as lawfully required. The contents therein (whether on paper,
electronic files or email, or contained in any other form) may not be destroyed
for any reason. An employee that does not abide by these requirements may
face criminal charges. Errors that were made may not be covered up or
misrepresented. On the contrary, errors should be exposed immediately and
completely and be immediately corrected.
Restrictions on Inside Information

Company stock (shares and options) are traded on the Tel-Aviv Stock Exchange
(TASE).
 The Securities Law forbids executing transactions on the stock exchange using
inside information.
 What is “inside information”? It is information pertaining to the development
of the Company, changes in its status, expected developments or changes, or
any other information that is not known to the general public and that if it was
known could significantly influence the price of the Company shares.
An example: information with regard to a “large transaction” that is expected to
be signed between the Company and a customer, that may in turn, increase the
Company profits, will be considered “inside information” as long as its is not
disclosed to the public at large, because it is expected that following the
publication the price of the Company shares will rise. Similarly, information with
regard to heavy loss by the Company is considered “internal information” until
officially published, as such information may cause the decline in the price of the
Company shares.
Other examples for inside information:
 Propositions with regard to substantial mergers and acquisitions
 The purchase or sale or substantial assets
 Developments with regard to substantial legal procedures
 Reorganization of the Company
 Distribution of dividend
 Financial data, financial results, forecasts or profits of the Company or its
subsidiaries
 Substantial changes in the composition of the senior management
 Information pertaining to substantial decisions made by management
 Substantial business information
When will information not be deemed “inside information”? At such a time as it
is published. Example: Information published through the media, the stock
exchanges web site or the web site of the Securities Authority. Thus, if
information pertaining to a “large transaction” or “heavy losses” in the
aforementioned examples was published on the web site of the stock-exchange
or as part of a press release then it is no longer deemed “inside information”.
Nevertheless, for information to be deemed publicly known, it is not enough that
it was published sufficient time must pass for it to be digested by the market.
Although the timing may change according to circumstances, a good rule of
thumb is that information is not deemed public until the passing of two business
days from its publication.

Forbidding the use of inside information means that it is forbidden to sell or buy
stock (buy or sell shares for example) based on inside information, or
forwarding such information to a third party, when there is a reasonable cause
to believe that this person will use the information (to buy or sell stock).
It should be emphasized that the employee as well as his family are forbidden to
use inside information for the purchase and sale of Company shares.
 Thus, one should act with strict confidentiality with regard to any information
reveled to you in the course of work and may not be used by you or your family
to trade in Company shares based on such information, as well as transfer it to a
member of your family, friend or any other person as a “tip”.
 Use of inside information for the purpose of using it to trade in Company shares
or as a “tip” to others, who may use it to trade in Company shares, is not only
unethical, it may be illegal. A Company employee who breaches the regulations
for using inside information may be punished in accordance with the criminal
law or be liable according to civil law and as a result may implicate the Company
as well.
 The Board of Directors of the Company will be entitled to draw a policy that
defines and limits the scope for employees and senior officers in the Company
with regard to trading in Company shares, in order to help the Company abide
by the regulations with reference to the use of inside information, and such
policy will be distributed to all Company employees.
Any question that arises with regard to use of inside information or suspicion
thereof may be addressed directly to the chairman of the Control Committee, Mr.
Yossi Antverg at tel: 052-6099000 or via email: antverg1@zahav. net.il


Proactive prevention of ethical problems is an important part of our ethics.
Should you suspect unethical conduct or a breach of our code of ethics you
must report these suspicions. We encourage you to provide information related
to such suspicions, regardless of the position held by the person suspected of
breaching them.
A mailbox for reporting suspicions or complaints with this regard is at
everyone’s disposal at the Company secretariat office. Additionally, one may
approach the chairman of the Company’s Control Committee Mr. Yossi Antverg
antverg1@zahav.net.il

In order to help us address and clarify every report we prefer that you identify
yourself and give your telephone number and any other contact details so that
we may communicate with you concerning the complaint; nevertheless,
anonymous reports will also be accepted.
The aforesaid in this code of conduct applies equally to both men and women.