|  TRANSLATION      FROM HEBREWTHE      BINDING VERSION IS THE HEBREWVERSION |
|---------------------------------------------------------------------------------|

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| General   License   for                                 | 1                                                                                        |
|---------------------------------------------------------------------------------------|------------------------------------------------------------------------------------------|
| CHAPTER      A: GENERAL                                                               | 2                                                                                        |
|        PART A: DEFINITIONS AND INTERPRETATION:                                   | 2                                                                                        |
| 1.                                                                                    | Definitions                                                                              | 2 |
| 2.                                                                                    | Clause      headings                                                                     | 12 |
| 3.                                                                                    | Blue      pencil principle                                                               | 12 |
|        PART      B – LEGAL PROVISIONS AND ADMINISTRATIVE PROVISIONS        | 13                                                                                       |
| 4.                                                                                    | Upholding      laws and provisions                                                       | 13 |
| 5.                                                                                    | Permit      obligation pursuant to any other law                                         | 13 |
| 6.                                                                                    | Contradiction      in the License provisions                                             | 13 |
| CHAPTER      B:  THE LICENSE – SCOPE, VALIDITY AND    CANCELLATION    | 14                                                                                       |
|        PART A – SCOPE AND PERIOD OF THE LICENSE                            | 14                                                                                       |
| 7.                                                                                    | Scope      of the License                                                                | 14 |
| 8.                                                                                    | Absence      of exclusivity A16                                                          | 14 |
| 9.                                                                                    | The      License period                                                                  | 15 |
| 10.                                                                                   | Extension      of the License Period                                                     | 15 |
| 11.                                                                                   | Renewal      of the License                                                              | 17 |
| 12.                                                                                   | Termination      of the License Period                                                   | 18 |
|        PART      B – CHANGE IN CONDITIONS AND CANCELLATION OF THE LICENSE  | 19                                                                                       |
| 13.                                                                                   | Change      in the License conditions                                                    | 19 |
| 14.                                                                                   | Cancellation      of the License                                                         | 19 |
| 15.                                                                                   | Other      remedies                                                                      | 22 |
| CHAPTER      C: OWNERSHIP, ASSETS AND MEANS OF CONTROL                                | 24                                                                                       |
|        PART      A – RESTRICTIONS ON TRANSFER OF THE LICENSE AND ITSASSETS | 24                                                                                       |
| 16.                                                                                   | Prohibition      on transfer of the license                                              | 24 |
| 17.                                                                                   | Ownership      of the Cellular System                                                    | 24 |
| 18.                                                                                   | Restrictions      on transfer of the License assets                                      | 24 |
| 19.                                                                                   | Engagement      with another                                                             | 25 |
|        Part      B: Means of Control – Changes and Limitations             | 26                                                                                       |
| 20.                                                                                   | Particulars      of Licensee                                                             | 26 |
| 21.                                                                                   | Transfer      of Means of Control                                                        | 26 |
| 22.                                                                                   | Encumbrance      of Means of Control                                                     | 28 |
| 22A.                                                                                  | Israeli      Nationality and Holdings of Founding Shareholders or Their      Substitutes | 29 |
|        Part      C: Cross-Ownership and Conflict of Interest                     | 31                                                                                       |
| 23.                                                                                   | Prohibition      on Cross-Ownership                                                      | 31 |
| 24.                                                                                   | Prohibition      on a Conflict of Interest                                               | 31 |
| Chapter      D: SETUP      AND OPERATION OF CELLULAR SYSTEM                           | 33                                                                                       |
|        Part      A: Setting Up the System                                        | 33                                                                                       |
| 25.                                                                                   | Definition                                                                               | 33 |
| 26.                                                                                   | Setup      according to Plans and Specifications                                         | 33 |
| 27.                                                                                   | Execution      Stages and Timetable                                                      | 33 |
|          28.                                                           | Modification      of Plans during Setup                                                  | 34 |
| 29.                                                                                   | Utilization      and Construction of Infrastructures                                     | 34 |
| 30.                                                                                   | Obligation      of Interconnection                                                       | 35 |
| 30A.                                                                                  | Rules      Concerning the Implementation of Interconnection                              | 35 |
| 30B.                                                                                  | Payment      for Traffic Completion and Interconnection                                  | 37 |
| 30C.                                                                                  | Prohibition      on Delaying Interconnection                                             | 37 |
| 30D.                                                                                  | Providing      the Possibility of Utilization                                            | 37 |
| 30E.                                                                                  | Infrastructure      Services for an Interested Company                                   | 37 |
| 30F.                                                                                  | Numbering      Program                                                                   | 38 |
| 31.                                                                                   | Reports      on the Setup Works                                                          | 39 |
| 32.                                                                                   | Handover      of Information and Documents                                               | 39 |

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| 33.                                                                       | Supervision      of Setup Works                                         | 39 |
|---------------------------------------------------------------------------|-------------------------------------------------------------------------|----|
| 34.                                                                       | Correction      of Deficiencies and Defects                             | 39 |
| 35.                                                                       | Safety      Precautions and Prevention of Hazards                       | 40 |
| 36.                                                                       | Void      A2A2)                                                         | 40 |
| 37.                                                                       | Intersections      with Electricity and Telecommunications Lines        | 40 |
| 38.                                                                       | Discovery      of Antiquities and Site Preservation                     | 40 |
| 39.                                                                       | Land-Related      Powers                                                | 40 |
|        Part      B: Equipment Checks and Installation Certifications | 42                                                                      |
| 40.                                                                       | Compliance      Check                                                   | 42 |
| 41.                                                                       | Responsibility      for Compliance                                      | 42 |
| 42.                                                                       | Performance      Testing Program and Its Approval                       | 42 |
| 43.                                                                       | Notice      of Setup Completion                                         | 42 |
| 44.                                                                       | Terms      of Fitness and Operation                                     | 42 |
|        Part      C: Use of Frequencies                               | 44                                                                      |
| 45.                                                                       | Allocation      of Frequencies                                          | 44 |
| 46.                                                                       | Restriction      on Use of Frequencies                                  | 44 |
| 47.                                                                       | Prevention      of Interferences                                        | 44 |
| 48.                                                                       | Cellphone      Activity in Emergencies                                  | 45 |
|        Part      D: Inspections and MaintenanceA43)                  | 47                                                                      |
| 49.                                                                       | Definitions                                                             | 47 |
| 50.                                                                       | Performance      of Inspections                                         | 47 |
| 51.                                                                       | Inspections,      Malfunctions and Maintenance Log                      | 47 |
| 52.                                                                       | Repair      of Deficiencies and Defects                                 | 48 |
| 53.                                                                       | Void                                                                    | 48 |
| 54.                                                                       | Void                                                                    | 48 |
| Chapter      E: PROVIDING      CELLULAR SERVICES TO SUBSCRIBERS           | 49                                                                      |
|        Part      A: Entering into an Agreement with Subscribers      | 49                                                                      |
| 55.A43)                                                                   | The      Contract                                                       | 49 |
| 56.      A43)                                                             | Modification      of Contract                                           | 50 |
| 57.      A43)                                                             | Void                                                                    | 50 |
| 58.      A43)                                                             | Void                                                                    | 50 |
| 59.                                                                       | Obligation      of Connecting Applicants and Prohibition on Stipulation | 50 |
|        Part      B: Service Level for Subscribers                    |  51                                                                |
| 60.                                                                       | Obligation      of Maintaining the Service                              | 51 |
| 61.A43)                                                                   | Public      Ombudsman                                              | 51 |
| 61A.A43)                                                                  | Umpiring      of Disputes                                               | 52 |
| 62.                                                                       | Obligation      of Maintenance                                          | 52 |
| 63.                                                                       | Repair      of Malfunctions                                             | 53 |
| 64.                                                                       | End-user      equipment – Selling and Renting                     | 53 |
| 65.                                                                       | Public      Emergency Services                                          | 54 |
| 65A.A16)                                                                  | Blocking      Service to a Nuisance Subscriber                          | 54 |
| 66.A16)                                                                   | Protecting      Subscriber Privacy                                      | 55 |
| 66A.T3)                                                                   | Special      Services for the Security Forces                           | 56 |
| 66B.A12)                                                                  | Security      Provisions                                                | 56 |
| 67.                                                                       | Bills      to Subscribers                                               | 57 |
| 67A.A16)                                                                  | Information      Service for Clarifying Telephone NumbersT39)           | 58 |
| 67B.A43)                                                                  | Void                                                                    | 60 |
| 67C.A16)                                                                  | Service      Dossier                                                    | 60 |
| 67D.A24)                                                                  | Erotic      Service                                                     | 62 |
|        Part      C: Termination, Delay or Restriction of Service     | 63                                                                      |
| 68.                                                                       | Definitions                                                             | 63 |
| 69.                                                                       | Prohibition      on the Termination or Disconnection of Service         | 63 |
| 70.                                                                       | Disconnection      of Service at Subscriber's Request                   | 63 |
| 71.                                                                       | Termination      of Service at the Subscriber's Request                 | 63 |
| 72.                                                                       | Termination      or Disconnection of Service Due to Breach of Agreement | 64 |
| 73.                                                                       | Disconnection      of Service Due to Maintenance Operations             | 64 |
| CHAPTER      F – PAYMENT FOR SERVICES                               | 66                                                                      |
|   Part A – General                                   | 66                                                                      |

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| 73A.                                                                                             | Definitions                                                            | 66 |
|--------------------------------------------------------------------------------------------------|------------------------------------------------------------------------|----|
| 74.                                                                                              | Payment      Categories                                                | 66 |
|        Part      B – Setting and Publication of Rates                                 | 68                                                                     |
| 75.                                                                                              | Setting      the Rates and Their Amount                                | 68 |
| 75A.A25)                                                                                         | Completion      of a Call in Another Public Telecommunications Network | 70 |
| 75B.A2A25)                                                                                       | Completion      of an SMS on Another Public Telecommunications Network | 70 |
| 75C.A27)                                                                                         | Temporary      Order                                                   | 70 |
| 76.                                                                                              | Publication      of Rates                                              | 71 |
| 77.                                                                                              | VoidA43)                                                               | 71 |
| 77A.                                                                                             | Fraud      Prevention                                                  | 71 |
|        Part      C – Changes in the Rates                                             | 73                                                                     |
| 78.A43)                                                                                          | Change      in the Rates                                               | 73 |
| 79.                                                                                              | Start      of an Increase or Reduction in a Rate                       | 73 |
| 80.                                                                                              | Arrears      in Payment                                                | 73 |
|        Part D – Miscellaneous                                                         |        74                                                         |
| 81.                                                                                              | Onetime      Debit for Connection Fee                                  | 74 |
| 82.                                                                                              | Collection      of Subscription Fee in Installments                    | 74 |
| 83.                                                                                              | Harm      to Competition or to Consumers                               | 74 |
| CHAPTER      G: PAYMENTS FROM THE LICENSEE, LIABILITY, INSURANCE ANDGUARANTEE                    | 75                                                                     |
|        Part      A – Royalties and PaymentsA16)                                       | 75                                                                     |
| 84.                                                                                              | Royalties                                                              | 75 |
| 85.                                                                                              | Arrears      in the Payment of Royalties                               | 75 |
| 86.                                                                                              | Payment      Method                                                    | 75 |
| 87.                                                                                              | Other      Mandatory Payments                                          | 75 |
|        Part      B – Liability and Insurance                                          | 76                                                                     |
| 88.                                                                                              | Definition      of Scope of Insurance                                  | 76 |
| 89.                                                                                              | Licensee’s      Liability                                        | 76 |
| 90.                                                                                              | Immunity      from Liability                                           | 76 |
| 91.                                                                                              | Making      an Insurance Contract                                      | 76 |
| 92.                                                                                              | Conditions      in the Insurance Contract                              | 78 |
| 93.                                                                                              | Remedy      for Breach of Conditions with Respect to Insurance         | 78 |
|        Part      C – Guarantee to Secure Fulfillment of the Terms of the      License | 79                                                                     |
| 94.                                                                                              | The      Guarantee and Its Purpose                                     | 79 |
| 95.                                                                                              | Exercise      of the Guarantee                                         | 79 |
| 96.                                                                                              | Manner      of Exercise of the Guarantee                               | 80 |
| 97.                                                                                              | Term      of Validity of the Guarantee                                 | 80 |
| 98.                                                                                              | Preservation      of Remedies                                          | 82 |
| CHAPTER      H – SUPERVISION AND REPORTING                                                 | 83                                                                     |
|        Part      A: Supervision of Licensee’s Activities                              | 83                                                                     |
| 99.                                                                                              | Supervisory      Power                                                 | 83 |
| 100.                                                                                             | Preservation      of Confidentiality                                   | 83 |
| 101.                                                                                             | Entry      to Premises and Inspection of Documents                     | 83 |
| 102.                                                                                             | Cooperation                                                            | 83 |
|        Part      B: Reporting and Correction of Defects                                     | 84                                                                     |
| 103.A43)                                                                                         | Duty      of Submission of Reports                                     | 84 |
| 104.A43)                                                                                         | Types      of Reports                                                  | 84 |
| 105.A43)                                                                                         | Notice      Concerning a Defect                                        | 86 |
| 106.A43)                                                                                         | Void                                                                   | 86 |
| CHAPTER      I – MISCELLANEOUS                                                             | 87                                                                     |
| 107.                                                                                             | The      License as an Exhaustive Document                             | 87 |
| 108.                                                                                             | Keeping      the License Document and Returning the License            | 87 |
| 109.                                                                                             | Postponement      of Deadline                                          | 87 |

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| 110.                                                                                                                               | Reserving      of Liability | 88 |
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| 111.                                                                                                                               | Notices                     | 88 |
|        First      Schedule                                                                                                    | 1                           |
|        Second      Schedule – List of Appendices                                                                        | 2                           |
|          Appendix      D – Uniform Engagement Agreement – Not Attached                                  | 1                           |
|          Appendix E      – Minimum Requirements and Level of Subscriber ServicesA16)                     | 1                           |
|          Appendix      J – Accessibility to International Telecommunications ServicesA6)                      | 1                           |
|          Appendix      K – Discontinuation of Service to Cellular End-User Equipment of the IS-54      typet7 | 1                           |
|          Appendix      O – Erotic ServicesA36effect)                                                          | 1                           |

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|  | 1.  |  Definitions |
|--|----------|-------------------|

|  | 1.1 | In      this License, the words and expressions below will have the meaning listed      next to them, unless another meaning is evident from the written language      or its context. |
|--|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| "      Type Approval"                             | - | Approval      given by the Minister pursuant to the Law and the Ordinance to a cellular      end-equipment model.                                                                                                                                                                                                                                                                                                                       |
|---------------------------------------------------|---|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| "Means      of Control"                           | - | In a      corporation – any one of the following:(1)      the right to vote at a general meeting of a company or in an entity      corresponding thereto in another corporation;(2)      the right to appoint a director or CEO;(3)      the right to participate in the profits of the corporation;(4)      the right to a share in the balance of the assets of the corporation after      payment of its debts on liquidation. |
| "Telecommunications"                              | - | Broadcast,      transfer or reception of marks, signals, written material, visual forms,      sound or information, via wire, wireless, optical system or other      electromagnetic systems;                                                                                                                                                                                                                                           |
| "Franchisee"A16                                   | - | As      defined in Section 6(12)(1) of the Law;                                                                                                                                                                                                                                                                                                                                                                                         |
| "Interested      Party"                           | - | Anyone      holding, directly or indirectly, 5% of a certain type of the Means of      Control;                                                                                                                                                                                                                                                                                                                                         |
| "Licensee"                                        | - | Anyone      to whom the Minster granted, pursuant to the Law, a general or special      license;      A16                                                                                                                                                                                                                                                                                                                               |
| "General Licensee"A16                             | - | Anyone      who has received a general license for implementing the Telecommunications      operations and providing Telecommunications services;                                                                                                                                                                                                                                                                                       |
| "Broadcasting Licensee"      A16                  | - | As      defined in the Law;                                                                                                                                                                                                                                                                                                                                                                                                             |
| "Accessibility      Fees"                         | - | Payment      for the use of another Telecommunications system, including for      connection, transmission and collection;                                                                                                                                                                                                                                                                                                              |
| "Technical      Requirements and Service Quality" | - | Standards      of availability and service quality, standards for Telecommunications      facilities and instructions for installation, operation and maintenance,      all according to the engineering plan as the Director will order from time      to time relating to the services of the Licensee                                                                                                                                |
| “Contract”A43                         | - | Contract      between the Licensee and a Subscriber, for the provision of all or any of      the services of the Licensee;                                                                                                                                                                                                                                                                                                              |
| the      "Proposal"                               | - | The      Licensee’s Proposal in the Tender;                                                                                                                                                                                                                                                                                                                                                                                       |
| the      "Bezeq Corp."                            | - | Bezeq      Israel Telecommunication Corp. Ltd.;                                                                                                                                                                                                                                                                                                                                                                                         |
| the      “Law"                              | - | The      Communications Law (Telecommunications and Broadcasts), 5742 – 1982; A16                                                                                                                                                                                                                                                                                                                                                 |

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| "Holding"A16                                   | - | For      the purpose of Means of Control – directly or indirectly, whether alone or      in concert with others, including through another, including a trustee or      agent, or through a right granted under an agreement, including an option      for a Holding that does not derive from convertible securities, or in any      other way;                                                                                                                                                                                                                                             |
|------------------------------------------------|---|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| "Transfer"A16                                  | - | For      the purpose of the Means of Control, whether directly or indirectly,      whether for consideration or without consideration, whether in perpetuity      or for a period, all at once or in parts;                                                                                                                                                                                                                                                                                                                                                                                        |
| "In Concert With      Others"A16               | - | Permanent      collaboration and, with regard to an individual, permanent collaborators      will be deemed – the individual, his Relative, and a corporation that one      of them controls and, with regard to a corporation – the corporation,      anyone controlling it and anyone who is controlled by one of      them;                                                                                                                                                                                                                                                         |
| "Security      Forces"                         | - | The      Israel Defence Forces, the Israel Police, the General Security Service and      the Mossad Institute for Intelligence and Special    Operations;                                                                                                                                                                                                                                                                                                                                                                                                                                          |
| "Index"                                        | - | The      Consumer Price Index published by the Central Bureau of Statistics from      time to time, or any other index that may replace it;                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| “Cellular      Radio Center"             | - | A      wireless facility functioning on the operating frequencies and used for      creating a radio connection between cellular end-equipment units in the      possession of the subscribers in its coverage area and the cellular      switchboard;                                                                                                                                                                                                                                                                                                                                             |
| "Interface"                                    | - | The      physical meeting between various functional Telecommunications units,      including by optical or wireless means;A16                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| "Telecommunications      Facility"             | - | A      facility or device intended mainly for telecommunication purposes,      including end-equipment;A16                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| "Tender No. 1/01"A16                           | - | A      tender published by the Ministry on 4 Nissan 5761 (March 28, 2001),      including the clarifications given by the Ministry in the course of the      Tender, as a result of which this License was amended;                                                                                                                                                                                                                                                                                                                                                                                |
| the      "Tender"                              | - | Tender      No. 10/93 published by the Ministry on November 11, 1993, including      clarifications given by the Ministry in the course of the Tender, as a      result of which this License is granted;                                                                                                                                                                                                                                                                                                                                                                                     |
| the      "Director"                            | - | The      Director General of the Ministry of Communications or anyone authorized by      him for the purposes of this License, in whole or in  part;                                                                                                                                                                                                                                                                                                                                                                                                                                               |
| "Subscriber"A43                                | - | Anyone      who enters into an agreement with the Licensee for the purpose of      receiving cellular services as an end user;                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| "International      Telecommunications System" | - | A      system of Telecommunications facilities, connected or designated for      connection to the Public Telecommunications Network through an      International NEP, which is used or designated for use in the transfer of      Telecommunications messages between an international switch situated in      Israel and a Telecommunications Facility located abroad, including a      satellite ground station and other Telecommunications facilities      (hereinafter – the System      Components) and including transmission facilities among the System      Components;      A16 |

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| "Mobile      Radio Telephone System" (Cellular System) | - | A      system of wireless facilities built by the cellular method and other      installations, through which mobile radio telephone services are provided      to the public, including a cellular coordinator, cellular radio centers      and wireless or cable transmission arteries between cellular radio      centers, a cellular radio center and a cellular coordinator, between      Cellular coordinators, or between a cellular switchboard and a Public      Telecommunications Network. |
|--------------------------------------------------------|---|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| "NDO (National Domestic      Operator)"A16             | - | A      General Licensee for the provision of landline domestic Telecommunications      services                                                                                                                                                                                                                                                                                                                                                                                                       |
| "Cellular      Operator"                               | - | A      General Licensee for the provision of mobile radio telephone services      A16                                                                                                                                                                                                                                                                                                                                                                                                                 |
| "Another      Cellular Operator"                       | - | A      Cellular Operator that is not the Licensee.                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| "Switchboard"                                          | - | A      Telecommunications Facility in which are situated and operated switching      and transmission means, enabling contact between various end-equipment      units that are connected or linked thereto, and the transfer of      Telecommunications messages between them, including control and monitoring      facilities and other facilities that enable the provision of various      services to Subscribers of the Licensee or to subscribers of another      Licensee;                   |
| the      "Ministry"                                    | - | The      Ministry of Communications                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| "Transit Switch"A16                                    | - | A      Telecommunications Facility in which are situated and operated the means      of switching, routing and transmission enabling contact between various      switchboards that are connected or linked thereto and the transfer of      Telecommunications messages between them, including control and monitoring      facilities;                                                                                                                                                              |
| "Officer"A16                                           | - | Anyone      acting as a director, CEO, chief business officer, deputy CEO, someone who      fills such a position in a company even if the title is different, as well      as any other manager who is directly subordinate to the CEO of the      company;                                                                                                                                                                                                                                          |
| "Appendices"A16                                        | - | The      first addendum and the Appendices set forth in the second addendum to the      License      A16                                                                                                                                                                                                                                                                                                                                                                                              |
| "NEP      (Network End-Point)"                         | - | An      Interface to which is connected on one side a Public Telecommunications      Network and on the other side, end-user equipment, a private network, a      mobile telephone network or other public network, as      applicable;                                                                                                                                                                                                                                                               |
| "International      NEP"                               | - | A      connections device to which are linked a Public Telecommunications Network      on one side and an International Telecommunications System on the      other;                                                                                                                                                                                                                                                                                                                                  |
| "Telecommunications      operation"                    | - | The      operation, installation, construction or maintenance of a      Telecommunications Facility, all for the purpose of      Telecommunications;                                                                                                                                                                                                                                                                                                                                                  |
| the      "Ordinance"                                   | - | The      Wireless Telegraph Ordinance [New Version]. 5732 –1972;                                                                                                                                                                                                                                                                                                                                                                                                                                |
| "End-User      Equipment"                              | - | Telecommunications      equipment, which is connected or is designated for connection to a public      Telecommunications network through an NEP or through a private network,      including a telephone, modem, facsimile or private      switchboard;                                                                                                                                                                                                                                              |

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| "Cellular      End-User Equipment"                     | - | Portable      or movable Telecommunications equipment, connected or designated for      connection to a Cellular System by means of a cellular radio      center.                                                                                                                                                                                                                                                                                                                                   |
|--------------------------------------------------------|---|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| "Interconnection"A16                                   | - | Connection      between a Public Telecommunications Network of one Licensee to a Public      Telecommunications Network of another Licensee, physically or logically,      that facilitates the transfer of Telecommunications messages between      Subscribers of the Licensees or the provision of services by one Licensee      to the subscribers of the other Licensee;                                                                                                                       |
| "Relative"                                             | - | Spouse,      parent, son, daughter, brother, sister or theirspouses;                                                                                                                                                                                                                                                                                                                                                                                                                                |
| the      "License"                                     | - | This      License, with all its Appendices and any other document or condition      stipulated in the License that will constitute an integral part of the      License or its conditions;                                                                                                                                                                                                                                                                                                          |
| the “Network"A16                                 | - | The      Cellular System of the Licensee;                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
| the      “Minister"                              | - | The      Minister of Communications, including anyone to whom he has delegated his      authority with regard to this License, in whole or in  part;                                                                                                                                                                                                                                                                                                                                                |
| "Public      Telecommunications Network"               | - | A      system of Telecommunications facilities, used or designated for the      provision of Telecommunications services to the general public throughout      Israel or at least in the area of service, including Coordinators or      Transit Switches, transmission equipment and an access Network, including      a Cellular System and an international Telecommunications system, except      for a private network, End-Equipment and Cellular      End-Equipment;                         |
| "Public      Telecommunications Landline      Network" | - | A      domestic Public Telecommunications Network, except for a Cellular System      and an international Telecommunications network;                                                                                                                                                                                                                                                                                                                                                               |
| "Access Network"A16                                    | - | Components      of a Public Telecommunications Network, which are used for connection      between Coordinators and an NEP by means of a landline infrastructure,      wireless infrastructure or a combination of the two;                                                                                                                                                                                                                                                                         |
| "Bezeq      Network"                                   | - | The      Public Telecommunications Network used by Bezeq for provision of its      services under the general license granted to it and the other      Telecommunications services provided under the Law, whether by Bezeq or by      any other person;                                                                                                                                                                                                                                            |
| "Use"A16                                               | - | Access      to a Telecommunications Facility of the Licensee, including to the public      Telecommunications network or its Access Network, in whole or in part, and      the possibility of using them for the purpose of conducting      Telecommunications operations and providing Telecommunications services by      means thereof, including the installation of a Telecommunications Facility      of another Licensee in a Telecommunications Facility or courtyards of the      Licensee |
| "Telecommunications      Service"                      | - | The      performance of Telecommunications operations forothers;                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| "Basic      Telephone Service"                         | - | Two-way      switched or routed transfer, including via modem, of speech or of      speech-like Telecommunications messages, for example, facsimile      signals;                                                                                                                                                                                                                                                                                                                                   |
| "Telephony Service"A16                                 | - | Basic      telephone service and services related to this  service;                                                                                                                                                                                                                                                                                                                                                                                                                                 |

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| "International      Telephone Service (ITMS)"          | - | A      telephone service by means of the international system of a Licensee for      the provision of international services;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
|--------------------------------------------------------|---|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| "Roaming Service"A16                                   | - | A      cellular service provided abroad and in the areas of civilian control of      the Palestinian Council via the Cellular System of a foreign Cellular      operator (hereinafter – Foreign Operator), whereby the Subscriber pays the      Licensee for the service; and, similarly, a cellular service provided in      Israel via the Cellular System of the Licensee, whereby the Licensee      provides service to a Foreign Operator for the subscribers of that      operator; in this regard, the "Palestinian      Council" – as defined in the Law for Implementation of the Interim      Agreement Regarding the West Bank and Gaza Strip (Jurisdictional Powers      and Other Provisions) (Legislative Amendments), 5756 – 1998      [sic]; |
| "Related      Service"                                 | - | A      service set forth in the first addendum to the License, provided on the      basis of the Basic Telephone Service and which, by its nature, can only be      provided by the supplier of the basic service;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |
| "Value Added      Service"A16                          | - | A      service provided on the basis of the Basic Telephone Service, which, by      its nature, can be provided by another, including another Licensee that is      not the supplier of the basic service; with regard to the services of the      Licensee, a service as stated, which is set forth in the first addendum to      the License;                                                                                                                                                                                                                                                                                                                                                                                                                                |
| "infrastructure      Service"                          | - | An      Interconnection, or possibility of Use given to another Licensee, to a      Franchisee or to a broadcast Licensee;A16                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| "Domestic Telecommunications      Landline Service"A16 | - | Infrastructure,      transmissions, communication of data and landline    telephony;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
| "Licensee      Services"                               | - | Cellular      services, Telecommunications Services and other services which the      Licensee is entitled to provide pursuant to this License, to its      Subscribers, to other Licensees, to broadcast licensees, to Franchisees      and to the Security Forces;A16                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| "Cellular      Services"                               | - | Telecommunications      services provided by means of the Cellular System;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| "Control"                                              | - | The      ability to direct a corporation's activity, directly or indirectly,      including ability deriving from the articles of incorporation, by virtue      of an agreement, either written or oral, by virtue of a Holding in the      Means of Control in another corporation - or from any other source, except      for ability deriving solely from fulfilling the position of director or      other position in the corporation;                                                                                                                                                                                                                                                                                                                                    |
| "the      Minister"                                    | - | The      Minister of Communications, including anyone to whom he has delegated his      authority with regard to this License, in whole or in  part;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
| "Engineering      Plan"                                | - | An      engineering plan submitted by the Licensee in the Tender, including any      change introduced therein with the approval of the Director and attached      to the license as Appendix B;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
| "Numbering Plan"A16                                    | - | As      defined in Section 5A(B) of theLaw;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |

----

----

| 1.2 | Other      words and expressions in the License, insofar as they are not defined in      Clause 1.1, will have the meaning they have in the Law, in the Ordinance,      in the regulations enacted thereunder, in the Interpretation Law, 5741 –      1981, or as set forth in the relevant places in the License, unless      another meaning is implied by the written language or its      context. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 2. | Clause      headings |
|----|----------------------|

----

| 4.1 | In      everything pertaining to the setup, existence, operation, and maintenance      of the Cellular System and the provision of Cellular Services thereby, the      Licensee will act in accordance with the provisions of any law and,      without derogating from the aforesaid generality, will ensure compliance      with the following: |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (1) | the      provisions of the Telecommunication Law and the regulations promulgated      thereunder; |
|--------|-----|---------------------------------------------------------------------------------------------------|

|   | (2) | the      provisions of the Wireless Telegraph Ordinance and the regulations      promulgated thereunder; |
|--------|-----|----------------------------------------------------------------------------------------------------------|

|   | (3) | administrative      provisions; |
|--------|-----|---------------------------------|

|   | (4) | international      Telecommunications and radio treaties to which Israel is a      party; |
|--------|-----|-------------------------------------------------------------------------------------------|

|   | (5) | any      other law or treaty that will apply to Telecommunications and radio, even      if they go into effect after the License is  granted. |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------------------------------|

| 4.2 | The      Licensee will act pursuant to laws and provisions as stated in Clause 4.1      as these will be in force from time to time during the license period,      including the remedies for the breach thereof, and they will be deemed an      integral part of the Licenseconditions. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 5.1 | The      granting of this License will not exempt the Licensee from the obligation      to obtain, with regard to execution of the License, any license, permit,      approval, or consent pursuant to any otherlaw. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| 7.1 | Pursuant      to this License and subject to all the provisions and conditions hereof,      the Licensee is entitled to set up, implement, maintain and operate a      Cellular System and, through it, to provide cellular Services to the      Israeli public; without derogating from the aforementioned generality, the      Licensee is entitled to do thefollowing: |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (1) | to      set up, implement, maintain and operate cellular radio centers and to      connect them to cellular switchboards, and to connect between cellular      switchboards, by means of cable and wireless transmission      channels; |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (2) | To      connect the cellular System to the Public Telecommunications Network of      Bezeq; |
|--------|-----|---------------------------------------------------------------------------------------------|

|   | (3) | To      connect the cellular System to the international Telecommunications      system; |
|--------|-----|------------------------------------------------------------------------------------------|

|   | (4) | To      connect its cellular System to another cellular  System; |
|--------|-----|------------------------------------------------------------------|

|   | (5) | To      contract with Subscribers for the purpose of providing cellular      Services; |
|--------|-----|----------------------------------------------------------------------------------------|

|   | (6) | To      provide Subscribers with cellular End-User  Equipment; |
|--------|-----|----------------------------------------------------------------|

|   | (7) | To      connect Subscribers to the cellular System and provide cellular Services      and other services pursuant to thisLicense; |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------------------|

|   | (8) | To      provide Subscribers with the followingservices: |
|--------|-----|---------------------------------------------------------|

|   | (A) | Basic      mobile wireless telephone service; |
|--------|-----|-----------------------------------------------|

|   | (B) | Related      services as set forth in the firstaddendum; |
|--------|-----|----------------------------------------------------------|

|   | (C) | Roaming      service;      A16 |
|--------|-----|--------------------------------|

|   | (D) | Any      other cellular service permitted pursuant to this License.A16 |
|--------|-----|------------------------------------------------------------------------|

| 7.2 | The      Licensee will not be entitled to provide any cellular service or other      Telecommunications Service that is not explicitly permitted within the      context of this License. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 8.1 | The      Licensee will not have any exclusivity in the provision of its      services. |
|-----|----------------------------------------------------------------------------------------|

| 8.2 | The      Minister is entitled, at any time, to grant a license to additional      operators for the provision of cellular  Services. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------|

| 8.3 | Should      the Minister publish a tender for the provision of cellular services, the      Licensee will be entitled to submit its bid in the tender, however, the      Minister will be entitled to determine as part of the conditions of such a      tender that if the Licensee wins the tender, the receipt of a license will      be contingent on the fact that the Licensee transfer its cellular System      to another as instructed by the Minister and under conditions determined      thereby, and it will cease to provide cellular Services by means      thereof. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| 9.1 | This      License is valid for a period of 10 years, commencing on the date of the      granting of the License (hereinafter – the License  Period). |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 9.2 | The      License Period may be extended by additional six years in accordance with      that stated in Clause 10 (hereinafter – the Additional      Period). |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 9.3 | This      License may be renewed for one or more Additional Periods of six years, in      accordance with that stated in Clause11. |
|-----|------------------------------------------------------------------------------------------------------------------------------------|

| 9.4 | During      the License Period and the Additional Period or on renewal of the License,      the License will be subject to the authority of the Minister pursuant to      Clauses 13 to 15 with regard to change, restriction, suspension or      cancellation of the License. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 9.5A15 | Notwithstanding      the aforesaid A16,      in the context of expansion of the License, as a result of the Licensee      winning Tender No. 1/01, this License will be valid for a period of twenty      (20) years, commencing on 19 Shevat 5762 (February 1,    2002). |
|--|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1 | The      Minister is entitled, at the request of the Licensee, to extend the      License Period for additional six years, if, after he has examined the      following: |
|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (A) | The      Licensee has complied with the provisions of the Law, the Ordinance, the      regulations thereunder and the provisions of the  License; |
|--------|-----|---------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (B) | The      Licensee has continually acted to improve the scope, availability and      quality of the cellular Services and to update the technology of the      cellular System and its activities did not include an act or omission that      would impair or restrict competition in the cellular    sector; |
|--------|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (C) | The      Licensee is capable of continuing to provide cellular Services at a high      level and that it is able to make the investments required for the      technological updating of the cellular System and for improving the scope,      availability and quality of the cellular  Services. |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2 | The      Licensee must submit its request for an extension of the License Period      during the forty-five days prior to the period of eighteen months      preceding the end of the LicensePeriod. |
|------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.3 | The      Licensee must attach the following to its  request: |
|------|--------------------------------------------------------------|

|   | (A) | A      report summarizing the annual statements that the Licensee has submitted      pursuant to this License between the date of commencement of the License      and the date of submission of itsrequest; |
|--------|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (B) | Comparison      of the data in the report for each year with the data for the preceding      year and explanations of unusual changes in the  data; |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (C) | Review      of the means, actions and investments taken or made by the Licensee to      improve the quality, scope and availability of the Cellular Services and      to develop and update the Cellular System  technology. |
|--------|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| 10.4 | The      summary report pursuant to Clause 10.3 must contain up-to-date and precise      details and be prepared in the form of an  affidavit. |
|------|------------------------------------------------------------------------------------------------------------------------------------------------|

----

| 10.5 | For      the purpose of examining the Licensee’s request to extend the License      Period, the Minister is entitled to require the Licensee to furnish,      during the period and in the manner that he will determine, any      information or document and, without derogating from the generality of      that stated, the Minister is entitled- |
|------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (A) | To      require the Licensee to attach any document to the summary report for the      purpose of verifying the details therein, to complete the report or to      furnish any additional detail that is not included  therein; |
|--------|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (B) | To      summon the Licensee to appear before him to respond to questions or to      present documents that are in its possession or under its control,      relating to the data in the report; |
|--------|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (C) | To      require the Licensee to submit to him an Engineering Plan outlining its      plans for the technological update of the Cellular System during the      Additional Period; |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.6 | The      Licensee must fulfil every requirement or summons as stated in Clause      10.5; if the Licensee is required to appear before the Minister, the      chairman of the board of directors of the company holding the License or      the CEO of the company or anyone authorized to do so in writing, will      appear; |
|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.7 | If      the Licensee fails at least twice to respond to the request or summons as      stated in Clause 10.5, the Minister is entitled to reject its request to      extend the validity of the License. |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.8 | The      Minister will inform the Licensee of his decision regarding the request      for extending the validity of the License no later than a year before the      end of the License Period. |
|------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.9 | The      Additional Period will be subject to the terms of this License, including      any change therein. |
|------|-------------------------------------------------------------------------------------------------------------|

|  | 10.10 | The      provisions of Clause 100 regarding confidentiality will apply, mutatis mutandis, to      data furnished by the Licensee to the Minister or anyone acting on his      behalf, pursuant to the provisions of Clause10. |
|--|-------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 11.1 | At      the end of the License Period or the Additional Period, the Minister is      entitled, at the request of the Licensee, to renew the License for one or      more Additional Periods of six years, as will be    determined. |
|------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 11.2 | The      Licensee will submit its request for the renewal of the License during the      forty-five days prior to the eighteen months preceding of the end of the      License Period or the AdditionalPeriod. |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 11.3 | The      Minister will inform the Licensee in writing, within 30 days of the date      of receiving its request for renewal of the License, whether he intends to      take the measures and institute the proceedings required to renew the      License, or a tender will be conducted for the services under this      License. |
|------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| 12.1 | If      the License Period pursuant to Clause 9.5A16      or the Additional Period pursuant to Clause 10.1 or the License Period      after its renewal pursuant to Clause 11.1 ends and the License is not      extended or not renewed, the Minister is entitled to instruct the Licensee      to continue to operate the  Cellular System for a period to be      determined (hereinafter - the Period for Terminating the Service) until a      license is duly granted to another for the provision of services pursuant      to this License (hereinafter – Alternate Licensee), and the procedures for      transferring the system thereunder are completed, or until a license is      duly granted to another for alternate services. In any case, the Period      for Terminating the Service will not exceed two years from the date on      which the License expires. |
|------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 12.2 | During      the Period for Terminating the Service and no later than ten months from      the date on which a license is granted to an Alternate Licensee, the      Licensee and the Alternate Licensee will negotiate for the purpose of      purchasing the Cellular system at its economic value and assigning the      rights and obligations of Subscribers to the Alternate Licensee; if said      Licensees do not reach an agreement within said ten months, the price will      be determined by an arbitrator, whose decision will be final, to be      appointed by the Chairman of the Institute of Certified Public      Accountants. |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| 13.1 | The      Minister is entitled to change, add to or subtract from the License      conditions if he is convinced that one of the following      exists: |
|------|--------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (A) | A      change has occurred in the extent of the License applicant’s suitability      to perform the actions and services that are the subject of the      License; |
|--------|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (B) | Subject      to that stated in Clause 8, a change is required in the License to ensure      competition in the telecommunicationsarea; |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------|

|   | (C) | A      change is required in the License to ensure the level of services provided      thereunder; |
|--------|-----|----------------------------------------------------------------------------------------------------|

|   | (D) | Changes      that have occurred in telecommunications technology require a change in      the license; |
|--------|-----|--------------------------------------------------------------------------------------------------------|

| 13.2 | The      Minister is entitled to change, increase or reduce the rates for services,      if he is convinced that a change has occurred in one or more of the      components of the costs, which represent a basis for calculating the      rates. |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 13.3 | The      Minister will act pursuant to his authority as stated in Clauses 13.1 and      13.2 after the Licensee has been given a reasonable opportunity to voice      its claims. |
|------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 14.1 | The      Minister is entitled to cancel the License before the end of its period,      if one or more of the causes set forth in Section 6 to the Law exist, or      in one of the following cases: |
|------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (A)         | The      Licensee did not disclose to the tenders committee information that must      be disclosed or it furnished inaccurate information;                                                                                                                                                                                                                                    |
|--------|-------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   | (B)A2  | If      the Licensee refuses to furnish the Minister or anyone acting on his      behalf with information in its possession that must be disclosed and which      it was obligated to disclose by virtue of the provisions of this license      or pursuant to law, or the Licensee furnished the Minister or someone      acting on his behalf with false  information;  |

|   | (C) | The      Licensee did not comply with the provision of the Law, the Ordinance or      the regulations thereunder; |
|--------|-----|-------------------------------------------------------------------------------------------------------------------|

|   | (D) | The      Licensee committed a material breach of the License conditions and,      without derogating from the generality of that stated, including the      following: |
|--------|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (1) | The      Licensee is demanding for its services payments that are higher than the      maximum rates prescribed in this License or pursuant thereto, or pursuant      to any law; |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (2) | The      Licensee is not complying with the coverage or quality requirements      prescribed in this license; |
|--------|-----|---------------------------------------------------------------------------------------------------------------|

|   | (3) | The      Licensee did not comply with the provisions of this license with regard to      the operation of digital technology in the  cellular      System; |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (E) | The      Licensee did not commence provision of the services pursuant to that set      forth in the License or unlawfully discontinued, restricted or delayed one      of the services; |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

|   | (F) | One      or more of the qualities that rendered the Licensee suitable to      participate in the tender for cellular services, or to be a Licensee, has      ceased to exist, including: |
|--------|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (1) | The      Licensee has ceased to be a company registered in  Israel; |
|--------|-----|---------------------------------------------------------------------|

|   | (2) | Residents      and citizens of Israel no longer hold, directly or indirectly, at least      20% of all of the Means of Control in the Franchisee; in this clause –      "Citizen of Israel" – as defined in the Citizenship Law, 5712 – 1952;      "Resident" – as defined in the Population Registry Law, 5735 –      1965; |
|--------|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (3) | A      majority of the directors in the Licensee company are not citizens and      residents of Israel; |
|--------|-----|---------------------------------------------------------------------------------------------------------|

|   | (4) | The      manager or a director of the Licensee company was convicted of an infamous      crime and continues to serve in hisposition; |
|--------|-----|---------------------------------------------------------------------------------------------------------------------------------------|

|   | (5) | The      joint equity, including surpluses, of all of the shareholders in the      Licensee company, together with the equity of the Licensee, has declined      to under US $200 million; in this matter, a shareholder holding less than      10% of the right to the company's earnings will not be taken into      account. |
|--------|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (6) | Before      5 years have elapsed from the date of granting the License, the share of      the cellular operator has fallen to less than 25% of the voting rights in      the general meeting or of the right to appoint a director or CEO in the      Licensee company; |
|--------|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (7) | Subject      to that stated in paragraph (8), the Licensee, or an officer in the      Licensee company or anyone who holds more than 5% of the Means of Control      in the Licensee company, holds, directly or indirectly, more than one per      cent (5%) of the Means of Control in BezeqA2,      Another cellular Operator, or one of them acts as an Officer in a      competing corporation. |
|--------|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (8) | If      one of the following occurs in an Interested Party in the Licensee      company, which is a mutual fund, insurance company, investment company or      pension fund; |
|--------|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | - | it      holds, directly or indirectly, more than 5% of any Means of Control in a      competing corporation, without receiving a permit therefor from the      Minister; |
|--------|---|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | - | it      holds, directly or indirectly, more than 5% of any Means of Control in a      competing company pursuant to a permit from the Minister and,      additionally, it is a controlling shareholder and exercises actual Control      in a competing corporation or it has a representative or appointee on its      behalf among the Officers in the competing corporation, unless it is      required to do so under law; |
|--------|---|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | - | it      holds, directly or indirectly, more than 10% of any Means of Control in a      competing corporation, even though it has received permission to hold up      to 10% of said Means of Control; |
|--------|---|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (G) | Void      A2 |
|--------|-----|--------------|

|   | (H) | If      an act or omission in the Licensee’s operations impaired or restricted      competition in the cellular sector; |
|--------|-----|-------------------------------------------------------------------------------------------------------------------------------|

----

|   | (I) | A      receiver or temporary liquidator was appointed to the Licensee company and      an order was given for its liquidation or it decided on voluntary      liquidation; |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (J) | Void      A2) |
|--------|-----|---------------|

|   | (K) | The      Licensee requested cancellation of theLicense; |
|--------|-----|---------------------------------------------------------|

|  | 14.1.1A2 | For      the purposes of sub-clause 14.1(E      A2), the restriction of service for technological reasons, effected      after the Director was provided with prior written notification of the      reasons and approved by the Director,  will not be considered      deemed an improper unlawful cessation, restriction or delay of      service. |
|--|----------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 14.2 | If      the Minister is convinced that, in the circumstances, the cause of      invalidity does not necessitate cancellation of the License, the Minister      will grant the Licensee a fair opportunity to rectify the act or omission      constituting a cause forcancellation. |
|------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 14.3 | The      Minister will notify the Licensee in advance of his intention to cancel      the license, will state in the notice the cause in question, and will      allow the Licensee to voice its claims relating to the cause for      cancellation, either in writing or orally, according to the circumstances,      within the period set forth in thenotice. |
|------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 14.4 | The      Minister is entitled to summon the Licensee to appear before him and may      demand that it respond to questions, present documents or furnish him with      whatever information and documents are required for the purposes of      clarifying the cause forcancellation. |
|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 14.5 | If      the Licensee is required or summoned as stated, it must respond to the      requirement or summons on the date set forth  therein. |
|------|--------------------------------------------------------------------------------------------------------------------------------------------|

| 14.6 | If      the Licensee fails to respond, at least twice, to the Minister's demand or      summons within the period stipulated by the Minister in his demand or      summons, the Minister is entitled to cancel the License in a notice that      will be sent to the Licensee (hereinafter - Cancellation      Notice). |
|------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 14.7 | In      the Cancellation Notice, the Minister will determine the date on which the      cancellation of the License will take effect and he is entitled to      instruct the Licensee to continue the provision of services pursuant to      this License until a license is granted to another or until the      appointment of a trustee or until a receiver is duly appointed for the      purpose of managing and operating the cellular System – as      applicable. |
|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 14.8 | The      Licensee will continue to provide services until the end of the period      stipulated by the Minister in his notice and will comply with the      provisions of this License and any instruction given by the Minister in      this matter. |
|------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

| 17.2 | Notwithstanding      that stated in Clause 17.1, the Director is entitled to permit the      Licensee to utilize the cable or wireless transmission arteries of another      for the purpose of connecting cellular radio centers, connecting a      cellular radio center to a Cellular Coordinator of the Licensee or of      another Licensee, connecting Cellular Coordinators of the Licensee,      connecting a Cellular Coordinator of the licensee to a Cellular      Coordinator of Another Cellular Operator      A16, or connecting a Cellular Coordinator to a Public      Telecommunications Network or to an International Telecommunications      Network. |
|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 18.1 | The      Licensee may not sell, lease or pledge any of the assets used in      performance of the License (hereinafter – the License Assets) with the      Minister's prior consent and in accordance with the conditions determined      by him. |
|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 18.2 | Without      derogating from the generality of that stated in Clauses 16 and 18.1, the      Minister will give his consent for the granting of rights in the License      Assets to a third party, if he is convinced to his satisfaction that the      Licensee has promised that, in any event, the exercise of the rights by a      third party will not cause any impairment in the provision of the services      pursuant to this License, as long as the Licensee is obligated to provide      these services pursuant to the provisions of this  License. |
|------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 18.3      A2 | Notwithstanding      that stated in Clause 18.1, the Licensee is entitled to encumber one of      the License Assets in favour of a bank duly operating in Israel, for the      purpose of receiving bank credit, provided that it has furnished notice of      the encumbrance that it intends to create, whereby the encumbrance      agreement includes a clause ensuring that that, in any event, the exercise      of the rights by the banking corporation will not cause any impairment in      the provision of the services pursuant to this license. For the purposes      of this clause – "Banking Corporation" is as defined in the Banking Law      (Licensing), 5741 – 1981, except for a "Foreign Corporation," as defined      in the same law. |
|--|--------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 18.4      A2 | The      provisions of Clause 18.1 will not apply to the sale of equipment items      during an upgrade, including the sale of equipment, as stated, on a      "trade-in" basis. |
|--|--------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| 19.1 | If      the Licensee wishes to provide one of the services pursuant to this      license, in whole or in part, through another on its behalf, it must apply      to the Director for his approval therefor; the Licensee must attach the      ContractA43)      to its application. The provisions of this clause will not apply      for the purposes of the engagement between the Licensee and a marketer of      Cellular End-Equipment or anyone acting on behalf of the Licensee for the      purpose of marketing its services. A2 |
|------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 19.2 | The      Director is entitled to approve or reject the application, or to condition      his approval on terms that must be fulfilled, including amendment of the      agreement; the Director will consider, inter alia, to what      extent the terms of the engagement with the other guarantee compliance      with the conditions of this License and the obligations of the Licensee      hereunder. The Director will not approve an engagement with another that      contradicts the obligations of the Licensee pursuant to this      License. |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 19.3 | Nothing      in the engagement with another will derogate from the obligations and of      the Licensee and its responsibility for performing any of the services      pursuant to this License, in whole or in part, pursuant to the provisions      of this License, nor will it serve to derogate from the powers of the      Minister, the Director or anyone acting on their  behalf. |
|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|  | 20.1A43) | Details      regarding the Licensee's legal entity, incorporation, holders of the      controlling interest, holders of a material influence, interested parties      and officers, are attached as Addendum A to the license. The Licensee must      submit to the Director, every year at the beginning of January, an updated      Addendum A. |
|--|----------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 20.2 | The      Licensee will report to the Director in writing regarding any change in      the information contained in Addendum A, including any transfer and      acquisition of control or of 5% of the means of control in the Licensee      company or change in the appointment of a director or general manager,      within 14 days of the date ofchange. |
|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 21.1 | There      will be no transfer, directly or indirectly, of ten percent or more of any      means of control in the Licensee, whether all at once or in parts, unless      this received the Minister's priorconsent. |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 21.2 | There      will be no kind of transfer of any means of control in the Licensee, or a      part of said means of control, so that as a result of the transfer,      control in the Licensee is transferred from one person to another, unless      this was given the Minister's priorconsent. |
|------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 21.3 | There      will be no acquisition of control, directly or indirectly, in the      Licensee, and there will be no acquisition, directly or indirectly, by a      person himself or together with his relative or with another person, who      operate with him regularly of 10% or more of any means of control in the      Licensee, whether all at once or in parts, without the prior consent of      the Minister. |
|------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 21.4 | Subject      to the foregoing in this section, there will be no transfer, directly or      indirectly, of means of control, so that the share of a cellular system      operator in the Licensee drops below 25% of the voting rights in the      general meeting and of the right to appoint a director or general manager,      except after 5 years have elapsed since the date of the granting of the      license. If 5 years have elapsed since the date of the granting of the      license, the cellular system operator's share can go below 25% to the      point of selling all the means of control in its possession to another,      all subject to the Minister's approval for the very reduction of the      cellular system operator's share in the means of control in the Licensee      and also regarding the purchaser. |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 21.5 | Notwithstanding      that stated in sections 21.1 and 21.3, if traded means of control in the      Licensee, not entailing the transfer of control in the Licensee, have been      transferred or acquired at a rate requiring approval under sections 21.1      or 21.3, without the Minister’s approval having been requested, the      Licensee shall report this to the Minister, in writing, and shall submit      to the Minister an application for approval of the transfer or the      acquisition, all within 21 days from when the Licensee learned of this      fact, provided the Minister gave his prior written approval to the holding      per se of the issue or the sale of the securities to the public. In this      regard, “traded means of      control” – means of control, including deposit certificates, Global      or American Depository Shares (GDRs or ADRs), or similar certificates, in      respect of securities listed on the stock exchange in Israel      and/or |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| 21.6 | Entry      into an underwriting agreement in connection with an issue or sale of      securities to the public, and listing on a stock exchange in Israel or      abroad, in a non-hostile country, or the deposit of securities, including      deposit certificates, Global or American Depository Shares (GDRs or ADRs),      or similar certificates, in respect of securities, or the registration      thereof with a nominee company and/or agent, shall not in themselves be      deemed as the transfer of means of control in the  Licensee. |
|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 21.7 | (A) | Irregular      holdings shall be registered in the members register (shareholders      register) at the Licensee, noting the fact of their irregularity,      immediately when the Licensee learns of this fact, and a notice concerning      the registration shall be delivered by the Licensee to the owner of the      irregular holdings and to the Minister. In this regard, “irregular holdings” –      the holding of traded means of control without the Minister’s agreement as      required under section 21 or in contravention of the provisions of section      23, and the entire holdings of a holder of traded means of control who      acted contrary to the provisions of section 24; the aforesaid for as long      as the Minister’s agreement is required and was not given under section 21      of the license or circumstances exist involving the contravention of the      provisions of sections 23 or 24 of thelicense. |
|------|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (B) | Irregular      holdings registered as stated in section 21.7(A), shall not confer any      rights on the holder, and shall be “dormant shares” as defined in section      308 of the Companies Law, 1999, except for purposes of receiving a      dividend or other distribution to the shareholders (including the right to      participate in an issue of rights which are calculated on the basis of      holdings in means of control in the Licensee, except that holdings added      as stated shall also be deemed as irregular holdings), therefore no act or      contention of exercise of a right by virtue of irregular holdings shall be      valid, except for purposes of receiving a dividend or other distribution      as stated. |
|--------|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (C) | Irregular      holdings shall not confer voting rights in the general meeting. A      shareholder participating in a vote in the shareholders meeting shall      notify the Licensee prior to the vote, or where the vote is by means of a      voting instrument – on the voting instrument, whether or not its holdings      in the Licensee or its vote require approval under sections 21 or 23 of      the License. If the shareholders did not give a notice as stated, it shall      not vote and its vote shall not becounted. |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (D) | A      director may not be appointed to the Licensee, elected or dismissed by      virtue of irregular holdings. If a director was appointed, elected or      dismissed as stated, such appointment, election or dismissal, as the case      may be, shall not be valid. |
|--------|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (E) | The      provisions of sections 21.7 and 21.9 shall be included in the articles of      the Licensee, mutatis mutandis. |
|--------|-----|-------------------------------------------------------------------------------------------------------------------------|

| 21.8 | For      as long as the Licensee’s articles prescribe as stated in section 21.7 and      the Licensee acts in accordance with that stated in sections 21.5 and      21.7, for as long as the holdings of founding shareholders or their      substitutes are not reduced to less than 50% of each of the means of      control in the Licensee, and for as long as the Licensee’s articles      prescribe that a majority of the voting power in the shareholders general      meeting may appoint all the |
|------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | For      purposes of this section, “founding shareholders or their      substitutes” – Discount Investment Corporation Ltd., DEC      Communications and Technology Ltd. and PEC Israel Economic Corporation, or      any other body to which any of those enumerated above transferred, with      the Minister’s approval, means of control, provided the Minister confirmed      in writing that the transferee body shall be deemed in this regard as the      substitute of the founding shareholder beginning from the date to be      determined by the Minister, and including anyone who is an “Israeli      entity” as defined in clause 22.2A, who acquired a means of control from      the Licensee and received the Minister’s approval for being deemed a      founding shareholder of its substitute starting from the date that was      determined by the Minister. The grant of approval under this section shall      not exempt the Licensee from the duty of receiving the Minister’s approval      for every transfer of means of control in the Licensee that requires      approval under any other section of thelicense. |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 21.9 | The      provisions of sections 21.5 and 21.8 shall not apply to founding      shareholders or their substitutes. |
|------|-------------------------------------------------------------------------------------------------------------------|

|   | A      shareholder of the Licensee company or a shareholder of an interested      party therein may not encumber his shares in such manner so that exercise      of the encumbrance results in a change in ownership of 10% or more of any      means of control in the Licensee, unless the encumbrance agreement      contains a limitation by which the encumbrance may not be exercised      without the prior consent of theMinister. |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|  | 22A.1 | The      total holdings of “founding shareholders or their substitutes” as defined      in section 21.8 (including anyone being an “Israeli entity” as defined in      section 22.2A below, who acquired means of control from the Licensee and      received the Minister’s approval for being deemed a founding shareholder      or a substitute thereof as from the date determined by the Minister), who      are mutually bound by an agreement for the fulfillment of the provisions      of section 22A of the license (in this section, all of the above will be      deemed: “founding shareholders or their substitutes”), cumulatively, may      not be less than 26% of each of the means of control in the      Licensee. |
|--|-------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 22A.2 | The      cumulative holdings of “Israeli entities,” one or more, included among      founding shareholders or their substitutes, out of the total holdings of      founding shareholders or their substitutes as stated in section 22A.1      above, may not be at any time less than 20% of the total issued capital      and of the means of control in the Licensee. For this purpose, the      Licensee’s issued share capital will be calculated less the number of      “dormant shares” held by theLicensee. |
|--|-------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  |   | “Israeli entity” – With      respect to an individual – anyone who is a citizen and resident of Israel;      with respect to a corporation – the corporation was incorporated in      Israel, and an individual who is a citizen and resident of Israel controls      it, directly or indirectly, provided indirect control is solely through a      corporation incorporated in Israel, one or more. However, for purposes of      indirect holding, the Prime Minister and the Minister of Communications      may approve holding through a corporation that was not incorporated in      Israel, provided such corporation does not hold shares in the Licensee      directly, where they are satisfied that this will not be detrimental to      the purposes of this section. In this regard, “Israeli citizen” – as      defined in the Citizenship Law 1952; “resident” – as defined      in the Population Registry Law 1965; “dormant share” – as      defined in section 308 of the Companies Law  1999. |
|--|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 22A.3 | At      least twenty percent (20%) of the Licensee’s directors will be appointed      by Israeli entities as stated in clause 22A.2. Notwithstanding the above,      in this regard, if the Licensee’s board of directors numbers up to 14      members – at least two directors will be appointed by Israeli entities as      stated in clause 22A.2 above, if the Licensee’s board of directors numbers      from 15 to 24 directors – at least three directors will be appointed by      Israeli entities as stated in clause 22A.2 above, and so      forth. |
|--|-------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 22A.4 | The      Licensee’s board of directors will appoint from among its members having a      security classification and security clearance as will be determined by      the General Security Service (hereinafter – “classified directors”),      a committee called the “Committee for Security  Matters.” |
|--|-------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  |   | At      least four directors will serve on the Committee for Security Matters,      among them at least one outside director. Matters pertaining to security      will be considered, subject to that stated in clause 22A.5 below, solely      in the framework of the Committee for Security  Matters. |
|--|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|  |   | A      resolution that was adopted or an action that was performed by the      Committee for Security Matters, will be deemed the same as a resolution      adopted or action performed by the Company’s board of directors, and it      will be considered by the board of directly only if this is required under      section 22A.5 below and subject to that stated in section 22A.5 below. In      this clause, “security matters” – as defined in the Telecommunications      Order (Designation of an Essential Service Provided by Bezeq Israeli      Telecommunications Company Ltd.)1997. |
|--|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 22A.5 | Security      matters which the Licensee’s board of directors or Audit Committee are      required to consider according to the cogent provisions in the Companies      Law 1999 or according to cogent provisions of any other law applying to      the Licensee, will be considered, insofar as necessary, by the board of      directors or by the Audit Committee, with the participation of classified      directors only. Non-classified directors may not participate in such      meetings of the board of directors or the Audit Committee and may not      receive information or inspect documents pertaining to the security      matters considered in the meeting. The quorum in every such meeting will      consist of classified directorsonly. |
|--|-------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  |   | The      Licensee will specify in its articles that an officer who by virtue of his      position and by virtue of the provisions of the law or the articles should      have received information or participated in meetings on security matters,      and is prevented from doing so by reason of the provision of clause 22A.5,      will be exempt from liability for breach of the duty of care towards the      Licensee, if the duty of care was breached due to non-participation in a      meeting or non-receipt ofinformation. |
|--|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 22A.6 | The      general meeting may not assume, delegate, transfer or exercise powers that      are vested in another organ of the Company, in security      matters. |
|--|-------|----------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 22A.7 | (A) | The      Minister will appoint an observer at meetings of the Company’s board of      directors and committees, having a security classification and security      clearance as will be determined by the General Security      Service. |
|-------|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (B) | The      observer will be a government employee qualifying as a director under      Chapter C of the Government Companies Law1975. |
|--------|-----|------------------------------------------------------------------------------------------------------------------------------------|

|   | (C) | In      addition, and without derogating from any duty imposed on him by law, the      observer will owe the Licensee a duty of confidentiality, except as      required for the fulfillment of his function as an observer. The observer      may not serve as an observer or in any other position on behalf of any      other entity engaging in the provision of communication services and      competing directly with the Licensee, and he will avoid any conflict of      interest between his function as an observer and the Licensee, except a      conflict of interest stemming from his being a government employee filling      the function of an observer at the Licensee. The observer will commit      towards the Licensee not to serve as an observer or officer and not to      hold any position or be employed, directly or indirectly, at any entity      competing directly with the Licensee or being in a conflict of interest      with it, except for a conflict of interest stemming, as stated, from his      being a government employee filling the function of an observer at the      Licensee, throughout his tenure as observer at the Licensee and during      eighteen (18) after the end of suchtenure. |
|--------|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  |   | In      any case of differences of opinion as to the observer being in a conflict      of interest, the Attorney General or someone on his behalf will decide in      the matter. |
|--|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | (D) | An      invitation to meetings of the board of directors and its committees,      including the Committee for Security Matters, will be delivered to the      observer as well, who may participate as an observer at any meeting as      stated. |
|--------|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (E) | The      observer’s right to receive information from the Licensee will be the same      as a director’s right. If the Licensee is of the opinion that certain      information in the nature of sensitive business information is not      required by the observer for the fulfillment of his function, the Licensee      may withhold delivery of such information to the observer, notifying him      in this regard. If the observer is of the opinion that he should receive      that information, the matter will be referred to the decision of the head      of the General Security Services. |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (F) | If      the observer saw that the Licensee adopted or is about to adopt a      resolution on security matters contrary to any provision of the license,      contract to section 13 of the Law or contrary to section 11 of the General      Security Services Law 2002, it will notify the Licensee without any delay,      in writing, such notice to be delivered to the chairman of the board of      directors and to the chairman of the Committee for Security Matters, and      to set a proper time in the circumstances of the case for remedying the      breach or modifying the resolution, should this be    possible. |
|--------|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 23.1 | The      Licensee, an officer therein or whoever holds more than 5% of any means of      control in the Licensee, will not hold, directly or indirectly, more than      one percent (5%) of the means of control in Bezeq, A16)      another cellular system operator. Regarding this matter, "holding" –      includes the holding as an agent. |
|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 23.2 | Notwithstanding      that stated in Section 23.1, an interested party in the Licensee that is a      mutual fund, insurance company, investment company or a pension fund, may      hold up to 5% of the means of control in Bezeq, another cellular system      operator A16),      provided all the following arefulfilled: |
|------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (A) | It      is not a controlling shareholder and does not exert, directly or      indirectly, any control in Bezeq or A16)      another cellular system operator; |
|--------|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (B) | It      has no representative or person in charge on its behalf among Bezeq's or      the other cellular system operator's officers, unless required to do so by      law. |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 23.3 | Pursuant      to a written request, the Minister may allow an interested party in the      Licensee, as stated in Section 23.2, to hold up to 10% of the means of      control in Bezeq, A16)      another cellular system operator, when the terms stated in Section 23.2(A)      and (B) are fulfilled, if he saw, to his satisfaction, that such a holding      will not harm competition. |
|------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | The      Licensee, an officer therein or an interested party in the Licensee      company will not be a party to any agreement, arrangement or understanding      with Bezeq, A16)      another |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

|   | In      this part – |
|--------|---------------------------|

|   | "Milestones"      – Stages in the setup of the cellular system, according to the timetable      detailed in the engineering plan – Addendum B to the    license. |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 26.1 | In      all pertaining to the setup and operation of the cellular system (in this      section – network), including the technical quality of its various      components, as well as the network's structure and manner of setup, the      Licensee will comply with the terms and provisions in the engineering      plan. |
|------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 26.2 | The      Licensee will follow all the specifications of the Ministry of      Communications and the network-related standards prescribed by      standardization organizations in Israel and around the world, as well as      other international organizations, in the telecommunications and wireless      field as well as in any other field pertaining to the setup and operation      of the network. |
|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 27.1 | The      setup rate of the cellular system, the setup milestones, the commencement      date for providing the service in the various regions in Israel, will be      in accordance with the timetable set in the engineering plan – Addendum B      to the license. |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 27.2 | The      Licensee may not deviate from the timetable unless authorized to do so by      the Director, provided the Licensee applies in writing to the Director to      receive his permission immediately after realizing that difficulties have      arisen that prevent it from meeting the original  timetable. |
|--|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 27.2.1 | A      delay in signing agreements with a third party or obtaining approval from      the planning and construction authorities will be deemed a reasonable      reason for obtaining the Director's permission for deviating from the      timetable, only if the Director realizes to his satisfaction that the      Licensee has done its reasonable utmost in the circumstances of the      matter, to come to an agreement with a third party or to receive approval      from the planning and constructionauthorities. |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 27.3 | The      Director may approve the Licensee's request to deviate from the timetable,      in whole or in part, and to stipulate conditions for its approval. The      Director may also approve deviation regarding a specific milestone,      provided the Licensee undertakes to catch up with the planned setup rate      in the succeeding milestones. |
|------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| 28. | Modification of Plans      during Setup |
|-----|-----------------------------------------|

| 28.1 | The      Licensee may not deviate from the engineering plan unless it has been      authorized to do so by the Director under the provisions of this section.      However, the placement of a Cellular Radio  Center in a      different site from that set in the engineering plan will not be deemed a      deviation, if done within the search region. As regards this section, a      "search region" denotes a territory defined in the engineering plan in      which a Cellular Radio center is planned to be set up, at a specific site      within the territory, and regarding which it has been stated in the      engineering plan that it might be necessary to place the center in another      site found in the territory. |
|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 28.2 | If      in the course of setting up the cellular system, the Licensee realizes      that it has become necessary to deviate or depart from the engineering      plan, the Licensee must apply in writing to the Director to obtain his      approval for the plan. In its application, the Licensee must describe the      essence and nature of the requested modification and the reasons therefor.      The Licensee must attach the amended plan it proposes, to the      application. |
|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 28.3 | The      Director may reject or approve the request, in whole or in part, and may      also stipulate conditions for its approval, insofar as these are needed      for the rigorous assurance of the network's quality and performance level.      The Director will make a decision in the matter of the request and notify      the Licensee of his decision, all within a reasonable amount of      time. |
|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 29.1 | For      the purpose of setting up and operating the cellular network, the Licensee      may, subject to any law, set up, maintain and operate cable or wireless      transmission arteries, provided such transmission arteries will be used      solely for the following: |
|------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (A) | Connection      between the Cellular Radio Centers forming part of the Licensee's cellular      system; |
|--------|-----|---------------------------------------------------------------------------------------------------------|

|   | (B) | Connection      between the Licensee's Cellular Radio Centers and its cellular      exchanges; |
|--------|-----|------------------------------------------------------------------------------------------------|

|   | (C) | Connection      between all the cellular exchanges; |
|--------|-----|-----------------------------------------------------|

|   | (D) | Connection      between the Licensee's cellular exchanges and a public telecommunications      system, or another cellular operator's cellular networkA16),      or other systems operatinglawfully. |
|--------|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 29.2 | For      the purpose of the connection described in Section 29.1, the Licensee may      use also the cable or wireless transmission arteries of Bezeq or of      another licensee or concessionaire lawfully authorized to provide      aforesaid infrastructure services. |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 29.3 | To      remove any doubt, it is hereby clarified that use of the transmission      arteries to be set up by the Licensee is solely for operating the cellular      system as stated in Section 29.1, unless the Minister permitted the      Licensee in the license to make other use thereof, in accordance with the      terms he laid down. |
|------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| 30.1 | The      Licensee will act to effect interconnection of the network with every      other public telecommunications network, operating in the territory      subject to the law, jurisdiction and governance of the State of Israel      (including settlements, military sites and military installations in      Judah, Samaria and Gaza Strip), including with every public landline      telecommunications network, international telecommunications network and      cellular network of another cellularoperator. |
|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 30.2 | The      interconnection between the network and another licensee's public      telecommunications network will be effected in such manner as to enable      the following: |
|------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (A) | Relay      of telecommunication messages between end-equipment connected to the      network and end-equipment connected to the other public telecommunications      network; |
|--------|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (B) | Proper,      regular provision of services by the Licensee to the other licensee's      subscribers, and the provision of services by the other licensee to the      Licensee's subscribers. |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 30.3 | Interconnection      may be effected either directly or indirectly, via a public      telecommunications network of another general license holder, provided it      enables that stated in Section30.2. |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 30.4 | As      regards the interconnection between the network and public landline      telecommunications network, the Licensee will act to set up interface      points between the two networks, for each type of service (infrastructure,      data transmission and communication, telephony), with at least three      transition switches, unless the Director has decided otherwise at the      written request of the Licensee. Setup of the interface points will be      done under an agreement between the Licensee and the domestic operator      licensee. Such an agreement will include, inter alia, the technical,      operational and business details of the connection, the number of      connections and their location. |
|------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 30.5 | As      regards the interconnection between the network and an international      telecommunications network, the Licensee will act in compliance with the      provisions of Addendum J to thelicense. |
|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | The      Licensee will act to implement interconnection in accordance with all the      following: |
|--------|----------------------------------------------------------------------------------------------------|

| (A) | The      Licensee will verify that the network's technical and operational      standards comply wit the requirements for linkup with the public      telecommunications network of the domestic operators, the other cellphone      operators, and the international operators (hereinafter – other operator), that      the network's activities will mesh properly with the activities of the      other operator's public telecommunications network, and that the      interconnection will not adversely affect the proper functioning of these      networks and the normal service to their  subscribers; |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| (B) | The      Licensee will provide the interconnection service under equal conditions      for every other operator and avoid any discrimination in actuating the      interconnection, including with regard to the  following: |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (1) | Supply      of infrastructure facilities and network linkup  services; |
|--------|-----|------------------------------------------------------------------------|

|   | (2) | Availability      of linkup facilities; |
|--------|-----|-----------------------------------------|

|   | (3) | Linkup      method, quality and survival; |
|--------|-----|-------------------------------------------|

|   | (4) | Alterations      and adaptations in the switching in the facilities, in the protocols and      at the network interface points; |
|--------|-----|---------------------------------------------------------------------------------------------------------------------------------|

|   | (5) | Payments      for interconnection; |
|--------|-----|------------------------------------|

|   | (6) | Debiting      and collection arrangements, and the transfer of information regarding      subscribers; |
|--------|-----|--------------------------------------------------------------------------------------------------------|

|   | (7) | Commercial      terms for effectinginterconnection; |
|--------|-----|-----------------------------------------------------|

|   | (8) | Submission      of information regarding the network and alteration therein relating to      interconnection; |
|--------|-----|---------------------------------------------------------------------------------------------------------------|

| (C) | The      Licensee will place at the disposal of the other operator any essential      information the other operator needs for providing its services via the      Licensee's facilities. Said information will be given subject to any law      concerning the protection of privacy or commercial confidentiality. In the      event the parties fail to reach an agreement regarding the nature and      scope of the essential information, the Minister will decide in the      matter; |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (D) | The      Licensee will give the other operator information regarding alterations      planned in its network, which may affect the interconnection with the      other operator's public telecommunications' network, or the      interconnection between the public telecommunications networks of the      other operators. The Licensee will provide the aforesaid information in      such manner as to enable the other operator to prepare reasonably for the      implementation of said alterations; |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (E) | As      regards Subsections (C) and (D), the Licensee may stipulate the provision      of information to the other operator on signing a reasonable privacy      protection agreement, intended to safeguard the Licensee's rights under      any law, including trade secrets, intellectual property rights and the      like, pertaining to information regarding modification of the network      meant to be given to the otheroperator; |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (F) | The      terms in respect of interconnection between the network and the other      operator's public telecommunications network will be formalized in an      agreement between the Licensee and the other operator. If the parties fail      to reach an agreement, the Minister will decide in the    matter. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (G) | (1) | The      Licensee will allow its subscribers to receive all the services offered to      them by another operator, The Licensee may also allow another operator's      subscribers to receive services from the Licensee, provided that said      receipt of services is possible under anylaw. |
|-----|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (2) | The      Director may order the Licensee to allow the other operator's subscribers      to receive services provided by the Licensee, provided that such receipt      of services is possible technically and under any  law. |
|--------|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (3) | Notwithstanding      that stated in Subsection (1), the Director may, at the written request of      the Licensee, exempt the Licensee from the obligation of allowing its      subscribers the possibility of receiving services from another operator,      for technical, economic reasons or for other justified      reasons. |
|--------|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| (H) | The      Licensee will forward to the Director a signed copy of every agreement      between it and the other operator concerning    interconnection; |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------|

| (I) | The      Licensee will forward to the Director on demand, any information given to      the other operator under Subsections (C) and (D), as well as a copy of      every confidentiality agreement under Subsection  (E); |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (J) | The      Licensee will act in compliance with additional provisions the Minister      will prescribe. |
|-----|-------------------------------------------------------------------------------------------------------|

|   | In      the event the Minister did not determine payment for interconnection or      payment deriving from interconnection, the Licensee may demand in respect      thereof reasonable and non-discriminatory  payment. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | The      Minister will give the Licensee a reasonable opportunity to voice his      position in all pertaining to the Minister's intention to order it      regarding the manner of effecting interconnection and its scope, regarding      the actions, services and arrangements incidental to effecting      interconnection, and regarding payments in respect of interconnection.      Once the Minister has instructed the Licensee on said matters, the      Licensee will not delay in any way interconnection with the network, and      will fulfill its obligations in accordance with the Minister's provisions,      properly and in good faith, on the date set therefore and with full      cooperation. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 30.1D | The      Minister may order the Licensee to provide the possibility of utilizing      its telecommunications facility, by virtue of his authority under Section      5 of the Law. |
|--|-------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 30.2D | The      Licensee will enable another licensee, by the Minister's order, to provide      value added services via the Licensee's network. The Licensee will ensure      reasonable and equal terms for any other licensee, in all pertaining to      the provision of value added services by the latter to the Licensee's      subscribers. |
|--|-------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 30.3D | As      regards providing the possibility of utilization, the provisions of      Sections 30A to 30C will apply, mutatis  mutandis. |
|--|-------|-------------------------------------------------------------------------------------------------------------------------------------|

|  | 30.1E | The      Licensee will not give preference, in providing infrastructure services,      to a licensee that is an interested company over another licensee, whether      in payment for the service, in service conditions, in service availability      or in any other way. |
|--|-------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| 30.2E | (A) | Pursuant      to a written request from the Licensee, the Director may permit the      Licensee limitations on the provisions of Section 30.1E, in all pertaining      to another licensee or a broadcasting licensee that is an interested      company, provided the following conditions are  fulfilled: |
|-------|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (1) | The      other licensee or the concessionaire is not a material      operator: |
|--------|-----|--------------------------------------------------------------------------------|

|   | (2) | The      Director is of the opinion that giving such permission does not materially      harm competition in the field of  telecommunications. |
|--------|-----|------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (B) | As      regards the limitations stated in Subsection (A), these may allow the      Licensee to offer an interested company the use of its telecommunications      facilities under preferred conditions, and these may be limited in time or      by another condition. |
|--------|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (C) | When      considering a permit under this section, the Director will take into      account the existence of a valid agreement, which was signed prior to      Amendment No. 16 to this license, between the Licensee and the interested      company, concerning, inter alia, the restriction of the permit in time or      by other conditions. |
|--------|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 30.3E | In      this section – "interested company,"      "subsidiary," and      "material      operator" – as these terms are defined in the Telecommunications      Regulations (Procedures and Conditions for Obtaining a General License for      Providing Domestic Landline Telecommunications Services),      2000. |
|--|-------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 30.1F | The      Licensee will act in accordance with the numbering program, and in      compliance with the Director's provisions regarding the activation and      implementation of the numberingprogram. |
|--|-------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 30.2F | The      Director ordered the activation of number portability, so that every      subscriber of another cellular system licensee will be able to switch over      to and be a subscriber of the Licensee or receive services from the      Licensee without any change in his telephone number, and vice versa – the      Licensee will incorporate into its public telecommunications network      devices enabling the application of this property, on the date and using      the method laid down in the Director's  provision. |
|--|-------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| 31.1 | The      Licensee will submit to the Director, throughout the cellular system setup      period, quarterly reports describing the setup works carried out during      the period of each report, according to the milestones and timetables in      the engineering plan. As regards this section, "the setup period" denotes      15 months from the date the license was granted or until the date of the      completion of the network's setup in full deployment, according to the      engineering plan, whichever theearlier. |
|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 31.2 | The      reports will include a comparison of the plans' execution versus the plan      for each report's period, as well as explanations for any deviation or      alteration that occurred in the execution compared with the      plan. |
|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 31.3 | Each      report will be submitted in triplicate in a format to be instructed by the      Director, and will bear a date and be signed by the Licensee or whoever it      empowered especially for thispurpose. |
|------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 31.4 | The      Director may demand that the Licensee prepare special reports, and also      that it draw up anew or supplement a report submitted to    him. |
|------|--------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | The      Licensee will furnish to the Director, on demand, any information or      document regarding the execution of cellular system setup works, at the      time, in the format, and in the manner instructed by the      Director. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 33.1 | The      Director may supervise, by himself or through a designee, the Licensee's      actions connected with the execution of the setup works. To this end, the      Director may enter at any reasonable time, the Licensee's work sites,      cellular system facilities and offices, for the purpose of making      measurements, performing inspections and perusing any plan or document      pertaining to the execution of the setupworks. |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 33.2 | The      Licensee will cooperate with the Director in all pertaining to the      supervision of the setup works, and without derogating from the generality      of the foregoing, will enable him to enter the work site and its      facilities, enable the perusal of any document, plan and specification,      and provide him with any information he  requests. |
|------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 34.1 | The      Director may notify the Licensee in writing about deficiencies, defects      and deviations he found in the cellular system setup operations, based on      reports submitted by the Licensee, documents and information it furnished      him, or based on measurements and inspections he  made. |
|------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| 34.2 | In      the event the Licensee receives a notice as stated in Section 34.1, it      will notify the Director, within fourteen days of the date of receiving      the notice, regarding its response to that stated therein and the measures      it took or plans to take, in order to correct the deficiencies, defects or      deviations. |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 35.1 | The      Licensee will execute the setup works, taking adequate safety precautions      to prevent personal accidents and property damage, will prevent the      causation of nuisances and hazards to the public in the work areas, and if      required to do excavations at the spot, will do everything to prevent      damages to underground systems, including telecommunications networks, and      to this end will make sure to obtain every permit required by any law,      including an excavation works permit under Section 53B of the      Law. |
|------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 35.2 | Upon      completion of the setup works, the Licensee will make sure to clean up the      work sites and restore them to their previous  condition. |
|------|-----------------------------------------------------------------------------------------------------------------------------------------------------|

|   | In a      place where there are electricity lines or electricity facilities prior to      the installation of the cellular system, the Licensee is subject to the      obligations imposed under the Telecommunications and Electricity      Regulations (Convergence and Intersection between Telecommunications Lines      and Electricity Lines), 1986. |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 38.1 | Antiquities,      as defined in the Antiquities Law, 1978, which are discovered at a setup      work site, are state assets, and the Licensee will take the appropriate      precautions to prevent damagethereto. |
|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 38.2 | The      Licensee will notify the director of the antiquities authority regarding      the discovery of an antiquity within 15 days of the date of the      antiquity's discovery and will follow the instructions of the authority's      director in all pertaining to the manner of handling the      antiquity. |
|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 38.3 | In      the course of the setup works, the Licensee will avoid, inasmuch as      possible, damaging sites of historical or national value, tourist sites      and landscape. |
|------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 38.4 | The      Licensee will avoid, insofar as possible, damaging buildings and trees      found in the places where setup works are being carried    out. |
|------|------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| 39.1 | The      Minister may, at the Licensee's request, grant it all or some of the      powers prescribed in Chapter F of the Law, subject to that stated in      Section 39.2. |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 39.2 | The      Licensee will specify in its request the sites at which it requires the      aforesaid powers, the scope of the required powers and the reasons      therefor, including the steps it took to find alternative sites, without      having to use the power under Chapter F of the  Law. |
|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 39.3 | In      the event the Minister is convinced of the need to grant the Licensee      powers under Chapter F of the Law, the Minister will publish his decision      in the Reshumot      (Official Announcements and Advertisements  Gazette). |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | The      Director may determine which items of equipment should not be installed in      the Cellular System before undergoing a compliance check. "Compliance" as      regards this section – as emerges from that stated in Section 41. If the      Director has decided as aforesaid, the items will not be installed before      undergoing a compliance check. |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | It      is the responsibility of the Licensee to see to it that the equipment      installed in the Cellular System is, at least, technically compliant with      the properties detailed in the manufacturer's specifications relating to      the specific item of equipment, and attached to the engineering      plan. |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 42.1 | The      Licensee will furnish the Director, no later than 30 days before giving      notice of the completion of installation under Section 43, with an      up-to-date, detailed testing program for carrying out the performance      check, relating to that part of the Cellular System it wishes to operate      (hereinafter – detailed testingprogram). |
|------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 42.2 | The      Licensee will present the detailed testing program to the Director. The      Director may demand within 15 days of the aforesaid presentation that the      Licensee make changes in the detailed testing program or complete it, if      he deems it necessary for the full and accurate execution of the      performance check, and the Licensee will carry out the checks according to      the Director's request. |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Once      the Licensee has completed setting up a Switchboard or Cellular Radio      Center in some region, so that it is possible to start providing cellular      services through it, the Licensee will notify the Director in writing      thereof, in the format it was instructed by the Director, along with the      results of the detailed check indicating successful installation and      operation. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 44.1 | Prior      to operating the network, the Licensee must meet the requirements and      conditions detailed below: |
|------|------------------------------------------------------------------------------------------------------------------|

|   | (A) | Entering into an Agreement with      an Equipment Manufacturer |
|--------|-----|----------------------------------------------------------------|

|   | (1) | Know-how      agreement; |
|--------|-----|--------------------------|

|   | (2) | An      agreement guaranteeing the supply of parts for the network's equipment for      a period of at least 7 years; |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------|

|   | (3) | An      agreement guaranteeing the supply of technical literature and full      documentation of the network's equipment, including    updates. |
|--------|-----|-------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | (B) | Lab and Testing      Equipment |
|--------|-----|--------------------------------|

|   | (C) | Parts |
|--------|-----|-------|

|   | (D) | Maintenance      System |
|--------|-----|-------------------------|

|   | (E) | Communication      Means |
|--------|-----|--------------------------|

| 44.2 | The      Licensee must present to the Director, seven days before setting the      network in operation for the first time, certifications and documents      regarding compliance with the requirements and conditions specified in      Section 44.1.  In the event the Director fails to respond within      five days of the date of delivery of said documents, the Licensee may      operate the Cellular System and connect subscribers thereto. If the      Director orders the Licensee, based on the documents' findings, to alter      or fix the network, the Licensee must make the required alteration or      correction and present a certification of execution to the Director, and      if the Director fails to respond within 3 days, the Licensee may operate      the system. |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| 45.1 | The      Licensee may operate the Cellular Radio centers of the Cellular System,      using the frequency bands allocated for its exclusive use, as detailed      below: |
|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (A)      A35) | 835      to 845 MHz and corresponding range 880 to 890  MHz; |
|--------|---------------|--------------------------------------------------------------|

|   | (A1)      A35) | 1710 to 1712      MHz and corresponding range 1805 to 1807MHz; |
|--------|----------------|----------------------------------------------------------------|

|   | (B) | Starting      from February 1, 2002 to January 1, 2004 the following bands will be      allocated: |
|--------|-----|----------------------------------------------------------------------------------------------------|

|   | (C) | Starting      from January 1, 2004 the following bands will be  allocated: |
|--------|-----|----------------------------------------------------------------------------|

|   | (C1)      A2A26) | Starting      from April 4, 2004 the following frequency bands will be      allocated: |
|--------|------------------|----------------------------------------------------------------------------------------|

|   | (D) | Notwithstanding      the foregoing, in the event the Licensee asks to postpone the usage      commencement date for the frequencies specified in subsections (B) and      (C), or a part thereof, to a later date, the Director may suspend the      allocation of frequencies to a date he decides  on. |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 45.2 | The      Licensee may select a narrower frequency band than that stated above in      the framework of the frequency bands specified in Section      45.1. |
|------|------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 45.3 | In      the event of detection of electromagnetic interferences from other      radiants that can harm the proper functioning of the Cellular System, the      Director must, at the Licensee's request, take any reasonable action to      find an appropriate solution or stop the aforesaid      interferences. |
|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | The      Licensee will make use of the frequencies allocated to it as stated in      Section 45 only for providing the services under this    license. |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------|

| 47.1 | The      Licensee will set up the Cellular System and operate it in such manner so      that no part of its parts will emit radiation prohibited under the      provisions of the Pharmacists' |
|------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| 47.2 | The      Licensee will coordinate the use of the frequencies with the Director, who      will base his directives, inter alia, on the program derived from the      preparation for a national emergencycrisis. |
|------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 47.3 | The      Licensee will submit to the Director, or anyone appointed for this purpose      on its behalf, a detailed, up-to-date plan for the operation of Cellular      Radio Centersand for the expected use of the frequencies at least 60 days      before the operation, and will report to the Director regarding the actual      execution, within 7 days of the operationdate. |
|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 47.4 | The      Licensee will set up and operate the Cellular System in such a manner as      to prevent interferences with other Bezeq and wireless systems operating      lawfully. Prior to the activation of any Cellular System, the Licensee      will perform tests and measurements for the purpose of preventing      electromagnetic interferences. If found that electromagnetic interferences      can be expected or interferences have been detected during operation, the      Licensee will act to find a solution that will prevent these interferences      and also prevent their recurrence, and in the absence of a solution it      will turn in writing to the Director or to anyone appointed for this      purpose on its behalf, in order to find a reasonable solution in this      regard. The Director may demand that each of the parties make changes in      the operation of the equipment or in the use of the frequencies or that      they stop broadcasting over certain frequencies, throughout the country or      in a certain region. |
|------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 47.5 | The      granting of this license, including the approval of the engineering plan,      in no way provides protection against harmonies from other radiants      operating lawfully, or other radiants operating outside state territory;      however, the Director must make every reasonable effort to find an      appropriate solution providing the necessary  protection. |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 48.1 | In      times of national emergency or for national security reasons, the one      empowered to do so by any law may take the steps needed for state      security, with a notice to the Licensee A2A2),      including control of the network. In such circumstances, the Licensee will      operate according to the instructions and notices of those authorized to      do so by any law, including the government, the Minister, the Director and      head of the unit for the management of a broadcasting spectrum and      satellites in an emergency (hereinafter – head of the emergency      unit). |
|------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 48.2 | The      Licensee will give the head of the emergency unit the names of its      representatives authorized to receive instructions and notices anytime, 24      hours a day, in all pertaining to national emergency and security matters.      The representative will have a first and second deputy, who will      substitute for him during hisabsence. |
|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 48.3 | The      Licensee will set up and operate the network in a manner that will allow      reducing the network's activity, when necessary, during times of      emergency: |
|------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | (A) | In      terms of the frequency profile; |
|--|-----|-----------------------------------------|

|  | (B) | In      terms of the geographical profile; |
|--|-----|--------------------------------------------|

----

|  | (C) | Through      the disconnection of part of its subscribers, according to predetermined      lists, or according to directives deriving from the    situation; |
|--|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | (D) | In      terms of a profile combining profiles A, B and  C. |
|--|-----|------------------------------------------------------------|

| 48.4 | The      Licensee will organize itself in such manner, so that it will be able to      carry out the reductions detailed in Section 48.3 rapidly and efficiently,      by remote control or by presence at the sites  themselves. |
|------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 48.5 | The      head of the emergency unit may establish a detailed procedure formalizing      and regulating the Cellular System activity during an emergency, which he      will present to the Licensee, and the latter will strictly fulfill the      provisions of this procedure. |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | "Periodical inspection" –      An inspection of the network or any part thereof performed according to      the license's provisions, at fixed time intervals and at least once every      half year; |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | "Special inspection" – An      inspection of the network or any part thereof performed due to a      maintenance action or repair, following electromagnetic interferences, a      malfunction, clarification of a complaint, a technological modification,      an alteration in the engineering plan or the  like; |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | "Regular inspection" – An      inspection of the network or any part thereof, done on a regular, ongoing      basis. |
|--------|----------------------------------------------------------------------------------------------------------------------------|

| 50.1 | The      Licensee will carry out periodical inspections on the Cellular System and      will submit the results of the inspection, at the Director’s request,      within 30 days of the day of therequest. |
|------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 50.2 | The      Licensee will set up and operate a control system for continual monitoring      of the performance and functionality of the network, and will perform, on      an ongoing basis,    regular inspections of the      network or any part thereof, asnecessary. |
|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 50.3 | The      Licensee will perform a regular inspection for quality of the service as      detailed in Addendum E, including compliance with relevant ITU-T      standards, and will submit the results of the inspection, at the      Director’s request, within 30 days of the day of the    request. |
|------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 50.4 | The      Director may instruct the Licensee to perform a special inspection; The      Licensee will perform such inspection in the format and at the time      specified by the Director and will submit its results to    him. |
|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 50.5 | The      Director or anyone so authorized by him will be allowed to carry out      inspections himself, where he deems this to be necessary; The Licensee      will permit the Director or anyone so authorized by him access to the      installations and the equipment, subject to prior coordination, and will      place at his disposal testing equipment used by it or professional      manpower employed by it. |
|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 51.1 | The      Licensee will manage an inspections, malfunctions and maintenance log      (hereinafter – maintenance log), in which details of the malfunctions in      and inspections of the network arerecorded. |
|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| 51.2 | The      Licensee will keep the maintenance log and enable the Director or a      representative authorized by him to peruse it at any time, to examine it      or copy it in any manner, and will submit it for inspection by the      Director at his request. |
|------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 52.1 | The      Director may, after giving the Licensee sufficient opportunity in the      circumstances of the case to present its case to him, notify the Licensee      in writing of deficiencies and defects he found that are affecting the      level of the service to Subscribers, the level of survivability and backup      of the network or the safety level or interfering with other lawfully      operating systems, based on a follow-up of the network’s performance,      including by means of Subscribers’ complaints or inspections carried out      by him or on the basis of inspection reports, documents and information      provided to him by the Licensee. |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 52.2 | The      Director may instruct the Licensee regarding the times by which it must      correct the deficiencies anddefects. |
|------|----------------------------------------------------------------------------------------------------------------------------|

| 52.3 | In      the event the Licensee received such a notice, it will notify the      Director, within the time set for this purpose in the Director's notice,      of the correction of the deficiencies and defects, at the level of detail      requested by the Director. |
|------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 53. | Void. |
|-----|-------|

| 54. | Void. |
|-----|-------|

----

| 55.1 | The      Licensee will prepare a wording for the contract that it intends to offer      its subscribers, and will submit it for the Director’s perusal at his      request. |
|------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 55.2 | The      terms of the contract shall not contradict, explicitly or implicitly, the      provisions of any law or the provisions of the license: The aforesaid      shall not prevent the stipulation of various provisions in the contract      that benefit the subscriber compared to the provisions of the law or the      license. |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 55.3 | The      contract will be in writing and laid out in a clear manner conducive to      reading and comprehension and specifying prominently any term or      limitation on the subscriber’s right to cancel the contract or on the      Licensee's liability toward the subscriber; Any stipulation in the      contract shall be stated explicitly and not by way of      reference. |
|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | For      purposes of this section, “writing” – including an electronic document      that can be saved and retrieved by the  subscriber. |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 55.4 | The      contract will include, inter alia, in a clear      manner, the following: |
|------|------------------------------------------------------------------------------------|

|   | (a) | Terms      of the service to the subscriber, including quality measures for customer      and subscriber service as detailed in section 2 in Addendum    E; |
|--------|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (b) | Terms      for disconnecting from the Licensee’s services or service discontinuation      terms; |
|--------|-----|--------------------------------------------------------------------------------------------------------|

|   | (c) | Licensee’s      rates for the services for which the subscriber registered, as of the day      of the agreement, including the date and terms for termination of the      rates program; |
|--------|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (d) | Limitation      on the rate of arrears interest, linkage differences and collection      expenses, as stated in section80.3; |
|--------|-----|------------------------------------------------------------------------------------------------------------------------------|

|   | (e) | Condition      for changing the rate for the service for which the subscriber registered,      as stated in section 78.1; |
|--------|-----|---------------------------------------------------------------------------------------------------------------------------|

|   | (f) | The      details set out in sections 61 and 61A regarding the public ombudsman and      umpire. |
|--------|-----|-------------------------------------------------------------------------------------------------|

|   | (g) | Condition      specifying that in case of a contradiction between the provisions relating      to the rates and to the basket of services detailed in the contract, and      the provisions of the license in this regard, the provisions of the      license shall prevail; |
|--------|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (h) | Notice      concerning the Director’s authority to instruct the Licensee to modify the      contract, and a clarification that the subscriber’s engagement with the      Licensee under the contract constitutes agreement to such      modification. |
|--------|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 55.5 | The      Licensee will deliver to the subscriber a copy of the contract and its      appendices. |
|------|--------------------------------------------------------------------------------------------------|

----

| 56.1 | The      Director may instruct the Licensee to modify the contract, after giving      the Licensee sufficient opportunity to present its  case. |
|------|-------------------------------------------------------------------------------------------------------------------------------------------------|

| 56.2 | If      the contract was amended pursuant to the Director’s instructions or      pursuant to a decision of the Standard Contracts Court, in the event that      the contract was submitted for its approval, the engagement between the      Licensee and the subscriber will be in accordance with the amended      contract, as from the date of theamendment. |
|------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 56.3 | The      provisions of section 55 shall apply, mutatis mutandis, to an      amendment of the wording of the contract by the  Licensee. |
|------|----------------------------------------------------------------------------------------------------------------------------------------|

| 57.      A43) | Void. |
|---------------|-------|

| 58.      A43) | Void. |
|---------------|-------|

| 59.1 | If      the Licensee has met the terms for operating a Cellular System as stated      in Section 44.2, the Licensee will connect any applicant to the cellular      network no later than the date set in the contract with the subscriber,      unless the Director has authorized the Licensee not to connect the      applicant, under circumstances he deems justified. A2) |
|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 59.2 | The      Licensee may not stipulate the connection of an applicant on unreasonable,      discriminatory or unfair terms, and without derogating from the generality      of the foregoing: |
|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| 60.1 | The      Licensee will put at the disposal of its subscribers all the services      detailed in the First Schedule, in accordance with the terms detailed in      the schedule, and will maintain all its services all year round, around      the clock, both in times of calm and in times of an emergency, subject to      Section 48, in accordance with the technical requirements and service      quality requirements, in a proper and regular fashion, and of a quality no      lower than that indicated by the service quality indexes specified in the      first schedule to the license and in Addendum E to the Second Schedule to      the license. In the event of a contradiction between the First Schedule      and Addendum E to the license's Second Schedule, the provisions of      Addendum E to the Second Schedule willprevail. |
|------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 60.2 | Without      derogating from that stated in Section 75.3, the Licensee will provide      cellular services and a service package, as this term is defined in      Section 73A, to every applicant, under equal and non-discriminatory terms      and at a non-discriminatory rate. |
|------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 60.3 | If      the Director has found that the service package is liable to harm      competition or the consumers, he will notify the Licensee thereof,      indicating the date by which the Licensee must stop offering its      subscribers the service package. |
|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 60.4 | If      the Licensee provides any cellular service to any person or organization,      for payment, the service must be available to any subscriber throughout      the network coverage area, complying with the minimal requirements as      regards service quality, without discrimination, within 24 months of the      date of commencing provision of the service for  payment. |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 60.5 | The      Director may, at the written request of the Licensee, allow the Licensee      limitations on the provision of Section 60.4, after being convinced that      there is a real difficulty in providing the service to anyone that      requests it, and that the specific features of the service possess a      unique and exceptional flavor justifyingthis. |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 60.6A43) | The      Licensee may not provide, with or without consideration, any of its      services not explicitly requested by the subscriber, except for a service      given free of charge to all the subscribers, and it may not allow the      provision of a service of a service provider not explicitly requested by      the subscriber. |
|--|----------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | For      purposes of this section, “service provider” – anyone providing a service      through the network, for which payment is made by means of the telephone      bill. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 61.1 | The      Licensee will appoint a person to handle complaints of the public (“the Ombudsman”), having      the following responsibilities: |
|------|-------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (a) | Clarifying      subscribers’ complaints in connection with the Licensee’s services,      including the complaint of someone applying to receive a      service. |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | (b) | Clarifying      subscribers’ complaints in connection with bills that were submitted by      the Licensee, and deciding in regardthereto. |
|--------|-----|-------------------------------------------------------------------------------------------------------------------------------------------------|

|   | The      Public Ombudsman will respond in writing to complaints as stated that were      submitted in writing. |
|--------|----------------------------------------------------------------------------------------------------------------|

| 61.2 | The      Public Ombudsman will act according to a policy to be set by the      Licensee’s management. |
|------|-------------------------------------------------------------------------------------------------------------|

| 61.3 | The      Licensee will render the Public Ombudsman all the assistance required by      him for filling his function. |
|------|----------------------------------------------------------------------------------------------------------------------|

| 61.4 | The      Licensee will notify every subscriber regarding the possibility of      submitting a complaint to the Public Ombudsman, the powers of the Public      Ombudsman and the ways of applying to him. The contents of this      sub-section shall be included in the contract, in the bill sent to the      subscriber and on the Licensee’swebsite. |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 61A.1 | The      contract will stipulate that any disagreements arising between the      Licensee and a subscriber in connection with the interpretation or      performance of the contract, shall be submitted for clarification to the      Licensee’s Public Ombudsman. |
|--|-------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 61A.2 | The      contract will specify that an application to the Public Ombudsman under      section 61A.1 shall not: |
|--|-------|----------------------------------------------------------------------------------------------------------------|

|   | (a) | Prevent      the subscriber a      priori from bringing his case before a competent    court; |
|--------|-----|-----------------------------------------------------------------------------------------------|

|   | (b) | Derogate      from the Licensee’s authority to act in accordance with the provisions of      section 72 regarding the discontinuation or disconnection of a service      owing to a breach of the contract. |
|--------|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 62.1 | The      Licensee is responsible for the maintenance of the Cellular      System. |
|------|-----------------------------------------------------------------------------------|

| 62.2 | If a      subscriber purchased cellular end-user equipment from the Licensee or from      its designee, and the purchase agreement included maintenance services,      the LicenseeA43)      will be responsible for the maintenance of said purchased end-user      equipment, however the LicenseeA43)      will not be responsible for the maintenance of said purchased end-user      equipment beyond the maintenance period undertaken by the manufacturer,      unless agreed otherwise between it and the subscriber.A2) |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| 63.1 | The      Licensee will maintain a regular service for handling subscribers' calls      concerning problems with receiving cellular services, and to this end will      operate centers for receiving messages from subscribers all year round      (excluding Yom Kippur), and 24 hours a day (hereinafter – call      center). |
|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 63.2 | Without      derogating from the generality of that stated in Section 63.1, the      Licensee will operate the call center in a manner enabling the receipt of      complaints from subscribers via telephone, in all pertaining to the      Licensee's services. |
|------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 63.3 | The      call center will be manned by skilled and professional personnel, having      the appropriate competence for handling problems, and if a complaint has      been received regarding a malfunction that led to disruption of the      service or regarding poor reception quality, said personnel will act      immediately to localize the malfunction and start taking measures to      correct it, as detailed in AddendumE. |
|------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 63.4 | The      Licensee will repair any malfunction for which a notification was received      at the call center, within the response time detailed in Addendum E. If      identification or repair of the malfunction necessitates a visit at the      subscriber's site, the Licensee will coordinate the repair date in advance      with the subscriber, provided that the length of time the subscriber has      to wait on said date does not exceed 4hours. |
|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 63.5 | The      Director may, at the Licensee's request, extend the repair time for the      malfunction if he deems that the time required for its repair exceeds that      stated in this section, provided that the time is not extended by more      than 5 days from the date on which the malfunction occurred. If the      Licensee applied to the Director for extension of the malfunction repair      time as stated, and no approval was given yet, the Licensee will continue      to work to repair the malfunction at the soonest  possible. |
|------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 63.6 | The      Licensee will specify in the maintenance log the details of the      malfunction and the steps taken to repair it, all as stated in Section      52. |
|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  |   | The      Licensee may sell or rent out to its subscribers cellular end-user      equipment for the purpose of linkup to the Cellular System, provided it      complies with the following: |
|--|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|  | 65.1A21) | The      Licensee will enable, anytime and at no charge, for all its subscribers,      free and rapid access to public emergency services such as: Magen David      Adom, the Israel Police and the FireStation. |
|--|----------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 65.2A42) | Starting      from April 5, 2007 (“the inception day”) the Licensee will enable the call      centers of the public emergency systemsA)      to identify the telephone number of a subscriber calling themB),      anytime and at no charge, including a subscriber with a confidential      telephone number, a subscriber who blocked his number before the call and      a subscriber calling from a privateexchange. |
|--|----------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | The      Licensee may do the aforesaid through a licensee that routes the call to      the public emergency system. |
|--------|---------------------------------------------------------------------------------------------------------------------|

|   | Not      later than two days before the inception dayA44)      the Licensee will notify all its subscribers, clearly, in writing, that      starting from the inception day it will be possible for the call centers      of the public emergency systems to identify the subscriber’s telephone      number, and it will notify in writing any subscriber requesting a      “confidential number” – that the number is not confidential with respect      to calls to the call centers of the public emergency    systems. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 65.AA16)   | Blocking Service to a Nuisance      Subscriber |
|----------------------|------------------------------------------------|

|  | 65.1A | Notwithstanding      that stated in Section 65.1, the Licensee will block a nuisance      subscriber's access to the public emergency service. If blockage of public      emergency service alone is not technically possible, then the Licensee      will block the nuisance subscriber's access to all the cellular services.      As regards this section, a "nuisance subscriber"      denotes a subscriber who has contacted a certain emergency center, for no      justifiable reason, more than 10 times during one whole day, using the      end-user equipment in hispossession. |
|--|-------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 65.2A | A      notice regarding a nuisance subscriber will be submitted in writing to the      Licensee by a senior employee in the public emergency service (hereinafter      – the employee) and will be corroborated by an affidavit signed by the      employee (hereinafter – the complaint). The complaint will include, inter      alia, the name of the nuisance subscriber, his telephone number, insofar      as these are known to the complainant, as well as a specification of the      contact times of the nuisance subscriber, and the content of the call      showing that the contact was made without any justifiable reason. If the      complaint does not include the telephone number of the nuisance      subscriber, the Licensee will act in a reasonable fashion, to identify the      nuisance subscriber based on the data provided in the      complaint. |
|--|-------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 65.3A | The      Licensee will block the nuisance subscriber's access to the emergency      service as stated in Section 65.1A, after giving the nuisance subscriber      advance warning. The notice will be given 3 workdays before the date of      service blockage, in one of the followingways: |
|--|-------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | A. | A      phone call from a service center of the Licensee to the cellphone      end-equipment of the subscriber; |
|--------|----|----------------------------------------------------------------------------------------------------------------|

----

|   | B. | An      SMS message sent to the cellphone end-equipment of the      subscriber; |
|--------|----|---------------------------------------------------------------------------------|

|   | C. | Delivery      of a registered letter to the subscriber, except for one who is a prepaid      subscriber and his address isunknown. |
|--------|----|------------------------------------------------------------------------------------------------------------------------------------|

|  | 65.4A | Blockage      of service to a nuisance subscriber who is a prepaid subscriber whose      address is unknown will be done no later than one full day from the time      of receiving a complaint or identification as stated in Section      65.2A. |
|--|-------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 65.5A | Notwithstanding      that stated in Section 65.1A, the Licensee will not block the public      emergency service to a subscriber, if the circumstances of contacting, as      these emerge from the explanation given by the subscriber to the Licensee,      show that the contacting was justified and that he should not be deemed a      nuisance subscriber. The Licensee will forward to the Director, within 10      workdays from the date of receiving the complaint or the identification as      stated in Section 65.2A, the arguments for not blocking the nuisance      subscriber. |
|--|-------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 65.6A | In      the event it blocked the nuisance subscriber's access to emergency calls,      the Licensee may collect from the subscriber all his debts, and may also      collect payment from him for removing theblock. |
|--|-------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 65.7A | The      Licensee may remove the block once the nuisance subscriber has given it a      written undertaking not to repeat his nuisance calls in the      future. |
|--|-------|------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 65.8A | The      Licensee will keep records of how the nuisance subscriber was identified,      how the notice was given to the nuisance subscriber, or, alternatively, in      a case where a notice was not given the nuisance subscriber, the reasoning      for not giving the notice. Likewise, a record will be kept concerning the      removal of the block. |
|--|-------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 65.9A | The      Licensee will specify, in the framework of the nuisance subscribers report      as stated in Section 104(B)A43),      the number of nuisance subscribers whose access to the public emergency      service or to all the cellular services was blocked under this section,      and the subscribers for whom said block was removed, as well as the number      of subscribers that were not blocked under this section and the reasons      for this. |
|--|-------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 66.A16)   | Protecting      Subscriber Privacy                                                                                                                                                                                                                                                                                                                                                                                                                                        |
|---------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| 66.1                | Without      derogating from the provisions of the Law, The Wiretapping Law, 1979, The      Privacy Protection Law, 1981, or any other law concerning the safeguarding      of an individual's privacy, the Licensee may not wiretap the telephone or      any other communication of the subscriber without the written permission      of the subscriber, except for the purpose of controlling the quality and      standard of the service or for preventing  frauds. |

| 66.2 | Subject      to that stated in Section 66A, the Licensee, its workers, agents and      designees may not disclose lists or documents containing the name and      address of a subscriber or any other information pertaining to him,      including account details, phone call traffic, call durations and      destinations, to any person whatsoever except to the subscriber or to      anyone empowered by the subscriber for this  purpose. |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| 66.3 | Notwithstanding      that stated in Section 66.2, the Licensee may do the      following: |
|------|-------------------------------------------------------------------------------------------|

|   | (A) | To      give the subscriber's details to another licensee for the purpose of      collecting monies owed  him by the subscriber in respect of      services it provided him through the network, provided that the      information relayed is necessary fro collecting monies and preparing      bills, and the other licensee has undertaken to safeguard the subscribers'      privacy; |
|--------|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (B) | To      transfer a subscribers' details to another, insofar as the particulars are      in its possession, by lawfulauthority. |
|--------|-----|--------------------------------------------------------------------------------------------------------------------------------|

T

|   | (A) | The      Licensee will provide special services to the security forces as detailed      in the classified security addendum attached to the license as Addendum I      and in the classified security addendum attached to the license as      Addendum LA12). |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  |                    (A1) | A12)      The Licensee will enable the security forces, regarding which the Director      informed in writing, to realize, subject to any law, their powers with      respect to any telecommunications activity in the framework of the      license, and will be responsible for the maintenance, proper functioning,      and technological adaptation of the equipment and infrastructure required      for realizing said execution capability, all in coordination with the      security forces, as detailed in Addenda I and L. The security forces will      bear the payment under the provisions of Section 13 of the      Law. |
|--|------------------------------------------------------------------------------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (B) | The      Licensee will see to it that Addenda I and L are guarded A12)      in accordance with the provisions of the procedure for safeguarding      records to be laid down by the Licensee in conjunction with the security      officer of the "General SecurityService." |
|--------|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (C) | The      Licensee will be exempt from the duty of indemnification toward the State,      by virtue of the provisions of Section 91.2 of the general license and/or      by virtue of any law, in respect of the very execution of the special      services for the security forces. |
|--------|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (A) | The      Licensee will appoint a security supervisor in accordance with the      provisions of the Security Arrangement in Public Bodies Law, 1998, and      rigorously follow the security provisions detailed in the Addendum M to      the license. |
|--------|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (B) | The      Licensee will establish appropriate provisions in the incorporation      documents and in its regulations, and will act in such manner so that only      a person who meets the conditions set out below will be appointed and      serve in a position or function enumerated in Addendum M to the      license: |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (1) | An      Israeli citizen, as this term is defined in the Citizenship Law, 1952, and      a resident of Israel; |
|--------|-----|---------------------------------------------------------------------------------------------------------------|

----

----

|   | (2) | Was      given security clearance by the General Security Service, by which there      is no prevention to his serving asstated. |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------|

|   | (C) | The      Licensee will act to safeguard the secrecy of the security forces'      operations, and act according to the security directives of those same      security forces, including in the matter of the appropriate security      classification for officers and holders of important functions working for      the Licensee, and compartmentalization of knowledge pertaining to      activities involving the securityforces. |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (D) | The      Licensee will take the measures necessary to protect the network, its      components and the databases used for providing services, and for      operating and controlling the network in the face of activities carried      out by unauthorized entities, according to the provisions detailed in      Addendum M to the license. |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 67.1A16) | A      bill that the Licensee submits to the subscriber should be clear,      succinct, readable and understandable. The bill should contain an accurate      breakdown of the components of the payment required according to the types      of payments and the rules specified in Chapter  F. |
|--|----------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 67.2 | A      credit due a subscriber from the Licensee will be included in the      successive bill immediately after the subscriber's right to the aforesaid      credit has been established. |
|------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 67.3 | The      Licensee may collect payments for his services from the subscriber through      another, including through Bezeq. |
|------|----------------------------------------------------------------------------------------------------------------------------|

|  67.4A34) | (A) | Without      derogating from the rest of the license provisions pertaining to the      manner of preparing the bill for the subscriber and to the manner of      debiting, the Licensee will act in compliance with Israel Standard 5262,      concerning debiting credibility and due disclosure in telephone bills      (hereinafter – "the Standard"). |
|----------------|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (B) | Subsection      (A) constitutes a "service condition," as concerns Section 37B(a)(1) of      the Law. |
|--------|-----|-------------------------------------------------------------------------------------------------------|

|   | (C) | Notwithstanding      that stated in subsection (A) - |
|--------|-----|------------------------------------------------------|

|   | (1) | Regarding      the provision in Section 2.2.2 of the Standard, the rounding off method      will apply as follows: |
|--------|-----|--------------------------------------------------------------------------------------------------------------------|

|   | (a) | An      amount in the bill will be rounded off to the nearest amount ending in two      digits after the decimal point of the shekel, with an amount ending in      five tenths of an agora (three digits after the decimal point) to be      rounded up. |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (b) | An      amount to be paid for a single call will be rounded off to the nearest      amount ending in three digits after the decimal point of the shekel, with      an amount ending in five hundredths of an agora (four digits after the      decimal point) to be rounded up. |
|--------|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | (2)    | The      Licensee may present any amount included in the bill with a breakdown      exceeding that required by the provision in Section 2.2.2 of the Standard,      provided the rounding off method stated in Subsection (C)(1) above will      apply thereto.                                                                                                                                                                                                                                                                |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
|   | (3)    | The      price of a phone call (voice) that includes a changing rate, will be      presented in the bill submitted to the subscriber as an average price per      minute, computed by dividing the payment amount for that same call by the      its total number of minutes.                                                                                                                                                                                                                                                  |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
|   |   | In      this paragraph, "changing rate" denotes a rate that varies in the course      of the call according to various criteria, such as a rate that diminishes      with increasing consumption, or a rate that varies due to a transition      from a "peak period" to a "slack period" in the course of the call or vice      versa.                                                                                                                                                                                        |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
|   | (4)    | In      addition to that stated in the provision of the last part of Section 2.2.4      of the Standard regarding service packages, the bill will contain a      breakdown of the services included in the package, along with the overall      rate paid for the package as a whole. In      this paragraph, "service package" denotes several services marketed to the      subscriber as a single package, in return for an overall rate (and without      a breakdown of the payment for each component  separately). |

|   | (D) | (1) | Chapter      B in the Standard concerning due disclosure in telephone bills will come      into effect no later than Friday, October 14,  2005. |
|--------|-----|-----|-------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (2) | Chapter      C in the Standard regarding debiting credibility will come into effect no      later than Sunday, January 14,2006. |
|--------|-----|---------------------------------------------------------------------------------------------------------------------------------|

T

|  | 67.1A | Without      derogating from the provisions of Section 66, the Licensee will provide,      by itself or through another on its behalf, an information service for      clarifying the telephone number of anyone who is a subscriber of a NDO or      of a Cellular System operator, excluding an ID-restricted subscriber      (hereinafter – "information service"), as  follows: |
|--|-------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (A) | For      the general public and at no charge, via a website through which the      service will be provided; |
|--------|-----|--------------------------------------------------------------------------------------------------------------|

|   | (B) | For      its subscribers, at a reasonable price, via a phone center, the access to      which will be effected by means of a network access code set by the      Director; |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (C) | The      information service will be given through each of the aforesaid means      based on the same information characteristics to be provided by the      subscriber applying to receive the  service. |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 67.2A | Without      derogating from that stated in Section 67.1A, the Licensee will provide to      the general public and at no charge, by itself or through another, an      information service for clarifying the telephone number of any subscriber,      excluding an ID-restricted subscriber, |
|--|-------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

|  |   | via      a phone center, the access to which will be effected by means of a      national access code set by theDirector. |
|--|--------|---------------------------------------------------------------------------------------------------------------------------|

|  | 67.3A | In      addition to that stated in Sections 67.1A and 67.2A, the Licensee may      offer, at a reasonable price, by itself or through another on its behalf,      an information service, by any other means, including by means of a      national access code or by means of anSMS. |
|--|-------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 67.4A | In      order to execute that stated in Subsections 67.1A and    67.3A: |
|--|-------|-------------------------------------------------------------------------|

|   | (A) | The      Licensee may send a query on its behalf to any database of a NDO or      cellular system operator (hereinafter – "another licensee"), or to receive      information from the database of another licensee by any other method and      with the consent of the other licensee, all subject to the duty of      safeguarding the subscriber'sprivacy; |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (B) | In      order for an information service to be provided by another licensee under      its general license, the Licensee will enable any other licensee access to      the Licensee's database; |
|--------|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (C) | The      Licensee will update the database on a regular basis, so that each name,      address or telephone number of a subscriber that was added, altered or      removed, will be updated in the database within one workday following      execution of the update in the Licensee's system being used to provide      telephony services. |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  |   | "Database"      denotes a collection of data including the name, address and telephone      number of any subscriber that is not ID-restricted, including a subscriber      that is a business. |
|--|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 67.5A | (A) | The      Licensee will request the consent of each new subscriber for including his      details in the database. If the subscriber gives his consent, the Licensee      will include his details in thedatabase. |
|-------|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (B) | The      Licensee will grant the first request of any subscriber who wishes to      remain ID-restricted, free ofcharge. |
|--------|-----|--------------------------------------------------------------------------------------------------------------------------|

|  |   | In      this subsection, a "new subscriber" denotes a subscriber who has signed a      contract with the Licensee after the commencement date as stated in      Section 67.7A. |
|--|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 67.6A | (A) | The      terms for providing an information service for clarifying telephone      numbers, given under Section 67A, will be established by the Licensee,      provided they are fair and non-discriminatory, including as regards the      order of the data presented to the user of the service. The service will      be given twenty four (24) hours a day, all year round, except for Yom      Kippur. In this subsection, "order of the data presented" – Insofar as the      answer to the service user's query comprises several different data, the      requested data will be presented to the service user in random      order. |
|-------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (B) | The      response in respect of the information service for clarifying telephone      numbers as stated in Section 67.2A will be given within a reasonable time.      If the Director sees that the waiting times for the service are not      reasonable, he may establish response time  indexes. |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (C) | An      information service for clarifying telephone numbers as stated in Section      67.1A(B) and an information service using a phone center, the access to      which is |
|--------|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   |   | effected      by means of a national access code as stated in Section 67.3A, will comply      with the service indexes specifiedbelow: |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------|

|   | (1) | At      any time, in the event of a heavy service call load6, the number of inquirers receiving      service should not be less than90%; |
|--------|-----|------------------------------------------------------------------------------------------------------------------------------------------|

|   | (2) | The      average waiting period of a caller until the start of receiving      service7 should not exceed  30      seconds; |
|--------|-----|--------------------------------------------------------------------------------------------------------------------------------------|

|   | (3) | The      maximum waiting period for a caller until the start of receiving the      service should not exceed 60seconds. |
|--------|-----|-------------------------------------------------------------------------------------------------------------------------|

|  | 67.7A | Section      67A will go into effect on February 8, 2007, except for Subsection      67.1A(a), which will go into effect on March 15, 2007 (“the commencement      date”), and except for Section 67.2AA45),      which will go into effect at the time of signing this      amendment. |
|--|-------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 67.8A | The      Licensee, by itself or through another, including together with another      licensee, will advertise all the information services for clarifying      telephone numbers given free of charge by the Licensee, as well as the      national access codes allocated to the cellular service licensees for      providing the service ("free information services"). The advertising      should include at least thefollowing: |
|--|-------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (A) | The      Licensee's website; |
|--------|-----|------------------------------|

|   | (B) | At      least once every half year, the Licensee will attach, in the framework of      the bill submitted to the subscriber, a separate information sheetA43)      regarding the free information services, which will not include any other      information, starting from the first bill submitted to the subscriber      following the commencement date. |
|--------|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (C) | At      least four (4) times during the first year following the commencement      date, the Licensee will run large, prominent ads in at least the 3 largest      Hebrew language newspapers, and in the largest newspaper in Arabic, in      English and in Russian, as well as in the largest economic newspaper.      These ads will include no other information. The first ad in all the      aforesaid newspapers, except for the economic newspaper, will be on the      first Friday after the commencement date or on the following one, and in      the economic newspaper it will run on the first Tuesday after the      commencement date or on the following one, regarding the free information      services. |
|--------|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 67C.1 | If      the Licensee wishes to operate a service included in the list of services      in the First Schedule and marked “future”, it must notify the Director of      this in writing not later than thirty (30) days before the date on which      it plans to begin providing theservice. |
|--|-------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

|  | 67C.2 | If      the Licensee wishes to operate a service not included in the list of      services in the First Schedule which it intends to provide to any      recipient of its services, it must notify the Director of this in writing      not later than thirty (30) days before the intended date for commencement      of provision of the new service. |
|--|-------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 67C.3 | The      Director will notify the Licensee within thirty (30) days of the date of      receipt of the Licensee’s notice as stated in sections 67C.1 and 67C.2,      whether it is allowed to commence provision of the service or whether it      must submit a service dossier for the Director’s approval, as a condition      for commencement of the service. |
|--|-------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 67C.4 | The      Licensee will submit a service dossier for the Director’s approval, at his      request; If the Licensee fails to submit a service dossier as instructed      by the Director, or if the Director does not approve the service dossier,      the Licensee shall not commence provision of the  service. |
|--|-------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 67C.5 | The      Director will give a decision regarding the service dossier that was      submitted to him within sixty (60) days from when the Licensee has      submitted to the Director all the documents and information requested by      him for the purpose of approving the service dossier. In special cases,      the Director may extend the times set in this section, by a written,      explanatory notice to be given to theLicensee. |
|--|-------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 67C.6 | The      Director may require the Licensee to submit for his approval a service      dossier for an existing service regarding which no service dossier was      previously required, and he may require the Licensee to submit for his      approval a new service dossier for a service regarding which a service      dossier was approved in the past. |
|--|-------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 67C.7 | The      service dossier will be submitted to the Director in the format and at the      time specified by the Director and will include, inter alia, the      following: the name of the service; a detailed description of the service      and the manner in which it is provided; the service rate, and an      engineering description, all as set out in the First Schedule; The      Director may give instructions on additional matters which are to be      included in the service dossier. |
|--|-------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 67C.8 | If      the service dossier is approved, the Licensee will provide the service      according to the terms of the approved dossier, and the approved service      dossier will be deemed an integral part of the  license. |
|--|-------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 67C.9 | The      Licensee will advertise an approved service dossier, with details and in      the manner specified by the Director, and the Director may advertise it      himself, provided he does not do so until after the Licensee has begun      providing the service. The advertising will not include information      comprising a trade secret, which was identified as such by the Licensee      and attached to the service dossier as a separate addendum marked as a      trade secret. |
|--|-------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 67C.10 | Any      new service which the Licensee begins to provide pursuant to this section      will be deemed a part of the First Schedule; The Director will update the      First Schedule from time to time. |
|--|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 67C.11 | The      provisions of this section will apply, mutatis mutandis, to a      trial using the Licensee’s network. |
|--|--------|-----------------------------------------------------------------------------------------------------------------------|

----

|   | An      erotic service provided through the network, will be provided in      accordance with the provisions of Addendum O in the Second      Schedule.As regards this section– |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | "Erotic      service" – as defined in Section 1 of Addendum O in the Second      Schedule. |
|--------|--------------------------------------------------------------------------------------------------|

----

|   | In      this part – |
|--------|---------------------------|

|   | "Disconnection      of service" – Temporary discontinuation of cellular system service to a      subscriber; |
|--------|--------------------------------------------------------------------------------------------------------------------|

|   | "Termination      of service" – Absolute discontinuation of cellular system services to a      subscriber. |
|--------|------------------------------------------------------------------------------------------------------------------|

|   | The      Licensee may not terminate or disconnect cellular system services and      other services, which the Licensee must provide under this license, unless      that stated in this part is fulfilled, or that stated in Section      48. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 70.1 | A      subscriber may ask the Licensee for a temporary disconnection of service      for a period no less than thirty days and no longer than ninety days      (hereinafter – disconnection period). The subscriber's request will be      made in writing, and may be done through the cellular system end-user      equipment in his possession, provided that the Licensee has verified the      request's credibility by a return call to the subscriber's cellular system      end-user equipment or by any other reliableway. |
|------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 70.2 | The      Licensee will effect the disconnection of service no later than the      workday following the day of the request's  submittal. |
|------|------------------------------------------------------------------------------------------------------------------------------------------|

| 70.3 | The      Licensee will resume the cellular system services to the cellular system      end-user equipment in the subscriber's possession at the end of the      disconnection period. If the subscriber requests, in a written notice, to      resume the cellular system services to the cellular system end-user      equipment in his possession before the end of the disconnection period,      the Licensee will resume the services no later than the workday following      the day on which the subscriber's notice was  submitted. |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 71.1 | A      subscriber may request in writing from the Licensee the termination of      service to the cellular system end-user equipment in his      possession. |
|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 71.2 | The      Licensee will terminate the provision of cellular system services to the      cellular system end-user equipment in the subscriber's possession no later      than the workday following the date specified by the subscriber in his      notice. If the subscriber did not specify a date, the termination of      service will be done no later than the workday following the day on which      the notice was received by theLicensee. |
|------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 71.3A2) | Notwithstanding      that stated in Section 71.2, the Licensee may disconnect service to the      subscriber without prior notice with the fulfillment of one of the      following: |
|--|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | (A) | The      subscriber did not pay for the third time during the same year the bill in      respect of the payments he was charged for cellular system services on the      date set therefor in the payment notice. In this section, "year" denotes      the period from January 1 to December31; |
|--------|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (B) | There      is reasonable suspicion of a fraudulent act being committed through the      subscriber's end-user equipment or using the features of the end-user      equipment; |
|--------|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (C) | the      Licensee found that the subscriber used the cellular system services in an      unusual amount for that type of subscriber, and after the Licensee's      service center contacted the subscriber in a phone call placed to the      end-user equipment in his possession, and the subscriber did not give a      reasonable explanation for said anomaly. As regards this paragraph,      consumption will not be deemed unusual when less than threefold the      average consumption for the same type of  subscribers. |
|--------|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 71.A2) | The      Licensee may disconnect service to a subscriber if it has found that the      end-user equipment in the subscriber's possession, through which the      subscriber receives cellular system services, causes interference with the      provision of cellular system services to other subscribers or interference      with the cellular system activity, provided that the Licensee gave the      subscriber anotice in writing of at least 21 days prior to the expected      disconnection date. The notice will specify the reason for the expected      disconnection and state that the subscriber is being given an opportunity,      within an amount of time to be set in the notice, to repair the end-user      equipment in such manner as to prevent said  interference. |
|--|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 72.1 | The      LicenseeA16)      may terminate or disconnect the service to a subscriber if one of the      following is fulfilled: |
|------|-------------------------------------------------------------------------------------------------------------------------------|

|   | (A) | The      subscriber did not pay a payment he owes in respect of service he      received, on the date set for its defrayal in his contract with the      Licensee; |
|--------|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (B) | The      subscriber breached a condition in the contract between him and the      Licensee, which was established as a material  condition; |
|--------|-----|---------------------------------------------------------------------------------------------------------------------------------------------|

|   | (C) | The      subscriber used unlawfully or allowed another to use as aforesaid the      end-user equipment in hispossession. |
|--------|-----|--------------------------------------------------------------------------------------------------------------------------|

| 72.2 | Service      to a subscriber will not be terminated or disconnected in the cases      detailed in Section 72.1(A) and (B), except after the Licensee gives the      subscriber a notice in writing at least 10 days prior to the expected      termination or disconnection date. The notice will state that the      subscriber is being given an opportunity, within the time set in the      notice, to rectify the act or default, in respect of which the service      will be terminated or disconnected. |
|------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| 73.1 | The      Licensee may temporarily disconnect or restrict services that it is      obligated to provide (hereinafter – disconnection due to maintenance), if      the need to carry out vital cellular system maintenance or setup      operations necessitates this, provided the following are      fulfilled: |
|------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (A) | The      duration of the disconnection due to maintenance does not exceed twelve      (12) consecutive hours; |
|--------|-----|---------------------------------------------------------------------------------------------------------------|

|   | (B) | The      number of disconnections due to maintenance does not exceed two (2) during      a single year; |
|--------|-----|---------------------------------------------------------------------------------------------------------|

|   | (C) | Void.A2) |
|--------|-----|----------|

| 73.2 | The      Director may ask the Licensee for a detailed explanation regarding the      circumstances necessitating disconnection due to maintenance, and may ask      the Licensee to postpone said disconnection if he came to the realization,      after considering the Licensee's contentions, that a vital public interest      necessitates such a postponement. |
|------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 73.3 | If      due to the need to carry out vital maintenance or setup operations in the      cellular system requires disconnection of service exceeding 12 hours, the      Licensee will ask in advance for the Director's approval. The request will      specify the maintenance operations required and the actions taken by the      Licensee to speed up these operations and reduce, inasmuch as possible,      the duration of the servicedisconnection. |
|------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 73.4 | Void.      A2) |
|------|----------------|

| 73.5 | If      disconnection or restriction of service is required urgently for the      purpose of carrying out immediate, vital operations, the Licensee will      notify the Director forthwith, including by phone, cable or fax, regarding      the urgent disconnection or restriction. The Licensee will notify its      subscribers about the aforesaid urgent disconnection or restriction, as      early as possible, including via the public address system operating      through the cellular system, insofar as this is possible, as well as      through the public media. |
|------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 73.6 | Notwithstanding      that stated in Sections 73.1 and 73.4, the Licensee does not have to      notify the Director or the subscribers about disconnection due to      maintenance, when the following arefulfilled: |
|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (A) | The      duration of the disconnection due to maintenance does not exceed half an      hour; |
|--------|-----|----------------------------------------------------------------------------------------------|

|   | (B) | Disconnection      due to maintenance is being done between 24:00 Saturday night and 05:00      Sunday morning the following day. |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------------------|

----

| “Licensee” -                                      | Anyone      to whom the Minister has granted, in accordance with the Law, a general or      special license;                                                                                                                                                                                                                                                         |
|--------------------------------------------------------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                               |                                                                                                                                                                                                                                                                                                                                                                 |
| “Airtime” -                                       | Duration      of the time in which a subscriber receives cellular services, whether the      connection is initiated by the subscriber or by someone    else;                                                                                                                                                                                                        |
|                                                               |                                                                                                                                                                                                                                                                                                                                                                 |
| “Airtime unit”A31A31)-                                 | Time      unit of 12 seconds at the most, but starting from Thursday, 1 January      2009, a time unit of 1 second.                                                                                                                                                                                                                                                  |
|                                                               |                                                                                                                                                                                                                                                                                                                                                                 |
| “Package of      services” -                      | Several      services sold to a subscriber as a package, for which a rate has been set      as specified in section 75.2.                                                                                                                                                                                                                                            |
|                                                               |                                                                                                                                                                                                                                                                                                                                                                 |
| “Public      telecommunications - network”      - | Including      an international telecommunications system.                                                                                                                                                                                                                                                                                                           |
|                                                               |                                                                                                                                                                                                                                                                                                                                                                 |
| “Payment for      completion of      a call” -    | Payment      made by the initiator of a call which began on end-user equipment      connected to one public telecommunications network and ended on another      public telecommunications network, or on end-user equipment connected to      such a public telecommunications network, for completing the call on the      other public telecommunicationsnetwork. |

|   | (a) | A      onetime installation fee for connecting mobile or portable end-user      equipment held by the subscriber to the Cellular system, including      issuance of a smart (SIM) card to the subscriber, or a onetime      registration fee (hereinafter – connectionfee); |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (b) | A      fixed payment; |
|--------|-----|-----------------------|

|   | (c) | Payment      for airtime as specified in section75A; |
|--------|-----|------------------------------------------------------|

|   | (d) | Payment      for completion of a call as specified in section  75A; |
|--------|-----|---------------------------------------------------------------------|

----

|   | (e) | Payment      for basic telephone services, related services and value added services,      detailed in the First Schedule to theLicense; |
|--------|-----|------------------------------------------------------------------------------------------------------------------------------------------|

----

|  | 75.1 | The      Licensee shall fix a rate for every service and package of services      provided by it to its subscribers, and it may determine the manner of      linkage of the rate to the index. The Licensee shall notify the Director      of the amount of each rate, before the rate comes into    effect. |
|--|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 75.2 | The      Licensee may designate packages of services according to types of services      included in the package or time periods or by any other method. The      Licensee may set a separate rate for each of the services included in the      package or set a general rate for thepackage. |
|--|------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 75.3 | The      Licensee shall offer each package of services at equal terms and at a      uniform rate according to categories of subscribers; For purposes of this      section, “category of subscribers” – A16)a      group of subscribers whose attributes provide reasonable justification for      distinguishing it from anothergroup. |
|--|------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 75.4 | The      Licensee shall allow any subscriber, without discrimination, to switch      from one package of services to another that is being offered by it at the      time. The Licensee shall include such a provision in the contract with its      subscribers. In the framework of this provision it may set times when it      is permissible to make such a switch and it may set conditions, including      payment terms, for implementing theswitch. |
|--|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 75.5 | If      the Licensee contracts with the subscriber in regard to a certain package      of services, and the contract includes a condition whereby the subscriber      commits to a certain contract period (hereinafter – the commitment      period), the package of services, its rates and conditions shall be known      and fixed in advance for the entire commitment period. The Licensee shall      include such a provision in the contract with its subscribers. The      Licensee may set, for a package of services, different rates that will      apply during the commitmentperiod. |
|--|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 75.6 | The      Licensee may not condition a contract with a subscriber or a subscriber’s      switch from one package of service to another on the purchase of value      added services or end-user equipment from the  Licensee. |
|--|------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 75.7 | A      package of services in which a payment in installments is set for end-user      equipment or for one of the services, shall include also a payment      arrangement in the event that the subscriber wishes to be released from      that package or to switch from that package to another package of      services, according to the outstanding balance of the payments due from      the subscriber or according to the remainder of the commitment      period. |
|--|------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 75.7 | A      package of services in which a payment in installments is set for end-user      equipment or for one of the services, shall include also a payment      arrangement in the event that the subscriber wishes to be released from      that package or to switch from that package to another package of      services, according to the outstanding balance of the payments due from      the subscriber or according to the remainder of the commitment      period. |
|--|------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 75.8 | (a) | The      Licensee may not collect from a subscriber payment for a call when the      call was not initiated by the subscriber (hereinafter – uninitiated      call). |
|------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (b) | Notwithstanding      that stated in subsection (a), the Licensee may collect from a subscriber      payment for an uninitiated call in the following  cases: |
|--------|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (1) | Call      transferred to the subscriber by means of a roaming    service; |
|--------|-----|---------------------------------------------------------------------------|

----

|   | (2) | Collect      call to which the subscriber has given his  agreement; |
|--------|-----|---------------------------------------------------------------------|

|   | (3) | Call      created by dialing a service number containing the access code 1-800, that      was allocated to the subscriber under an agreement with    him; |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (4) | The      subscriber’s share in a call created by dialing a service number      containing the access code 1-700 (split debit), that was allocated to the      subscriber under an agreement withhim. |
|--------|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

I

|   | (a) | The      Licensee may collect from a subscriber who initiates a call by means of      access code 1-800, whose destination is on another licensee’s network, a      lower rate than the one applying to the subscriber for a call not      initiated through such an access code, provided it does not exceed the      amount set by agreement between the Licensee and the other licensee, and      in the absence of such agreement – does not exceed the amount set by the      Minister2. |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (b) | That      stated in subsection (a) shall not apply to calls destined for 1-800      numbers with a special numbering format that were allocated to the      international operators for the purpose of providing international      telecommunication message services, as this term is defined in the      international operator’s licenseA). |
|--------|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 75.10 | The      payment for airtime will be determined in the manner set out      below: |
|--|-------|-----------------------------------------------------------------------------------|

|   | (a) | The      payment for airtime will be determined according to an airtime unitA31);      For the purpose of calculating the payment, a part of an airtime unit      shall be deemed the same as a whole airtime  unit. |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (b) | VoidA46). |
|--------|-----|-----------|

|   | (c) | The      duration of the call for payment purposes is from the moment the      connection is established between the subscriber who initiated the      connection (hereinafter – the calling subscriber) and the subscriber      receiving the call, until the moment when the call is terminated, which is      the moment when an instruction to terminate the connection is received      from the calling subscriber or from the subscriber receiving the call; The      duration of the connection setup time, until the moment the connection is      established, and the duration of the disconnection time, from the moment      the instruction to terminate the connection is received until it is      actually implemented, is not included in the count of the duration of the      call. |
|--------|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | In      this regard, subscriber receiving the call – including a voice      mailbox. |
|--------|--------------------------------------------------------------------------------------------|

----

  

  

  

----

|   | “Voice mailbox” – an      installation or device forming part of the cellular system, designed      to enable the calling subscriber to leave a voice message for the called      subscriberA40). |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (d) | A40)      Regarding a call that is transferred to a voice mailbox, the Licensee      shall play to the calling subscriber an introductory voice message,      lasting at least 2 seconds (in this subsection – “message”), and will      enable the calling subscriber, at his option, to disconnect the call      without any debit, in the course of the message, or within a reasonable      time being not less than one second after the end of the message (“reasonable time”). In      such case, the moment of establishing the connection with the subscriber      receiving the call, within the meaning of subsection (c) above, will be      deemed to occur at the end of the reasonable time. The      wording of the message will be: “The call is being transferred to a voice      mailbox,” and it will be articulated clearly and at a reasonable speed. In      this subsection, “call      transferred to a voice mailbox” – excluding a call originating in      an international telecommunications  system. |
|--------|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | The      payment for completion of a call to be collected by the Licensee shall not      exceed the interconnection rate specified in the Telecommunications      Regulations (Payments for Interconnection),  2000. |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | The      Licensee may collect from a subscriber for the transfer of an SMS which is      being transferred from end-user equipment that is connected to the network      to end-user equipment that is connected to a cellular system of another      cellular licensee, a      payment not exceeding the payment which the Licensee collects from the      subscriber for the transfer of an SMS which is transferred from end-user      equipment that is connected to the network to end-user equipment that is      connected to the network, plus a payment not exceeding the rate for the      transfer of an SMS specified in the Communications Regulations      (Telecommunications and Transmissions) (Payments for Interconnection),      2000.  |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |
|   | For      purposes of this section –                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |
|   | “SMS”      – telecommunications messages comprised of writing, including signs or      symbols, transferred from end-user equipment that is connected to the      network, to end-user equipment that is connected to the network or to a      cellular system of      another cellular      licensee.                                                                                                                                                                                                                                                                                                                                                                                                                                    |

|   | Notwithstanding      that stated in section 75B, for the period beginning May 9, 2004 and      ending February 9, 2005A29),      the following provisions shallapply: |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | (a) | The      Licensee may collect from a subscriber for the transfer of an SMS which is      destined for end-user equipment that is connected to a cellular system of another      cellular licensee      (hereinafter – “inter-network SMS”) a payment not exceeding the payment      which the Licensee collects from the subscriber for the transfer of an SMS      which is transferred from end-user equipment that is connected to the      network to end-user equipment that is connected to the network, plus a      payment not exceeding the rate for the transfer of an SMS specified in the      Communications Regulations (Telecommunications and Transmissions)      (Payments for Interconnection), 2000, less a rate of 0.7%8; |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (b) | The      Licensee may collect from a subscriber payment for an inter-network SMS as      stated in subsection (a), even if its transfer to the called subscriber      was not completed. |
|--------|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 76.1 | The      Licensee shall provide to anyone so requesting, at the service offices and      at the call centers, free of charge, full and detailed information      concerning the up-to-date rates for all its services, including the      payment for completion of a call; The Director may instruct the Licensee      concerning the manner and format of publication of the      rates. |
|--|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 76.2 | The      Licensee shall indicate in every account sent to a subscriber the package      of services according to which the subscriber is being      debited. |
|--|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 76.3 | The      Director may request to receive from the Licensee at any time details of      the rates charged by it. |
|--|------|-----------------------------------------------------------------------------------------------------------------|

|  | 77A.1 | The      Licensee shall take suitable and reasonable steps to prevent fraud and      shall maintain a control and follow-up system for verifying, to the extent      possible, that the calls for which the subscriber is being debited were      actually made from end-user equipment connected to the Licensee’s cellular system in the      subscriber’s name. |
|--|-------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 77A.2 | The      Licensee shall disconnect the service to the subscriber’s end-user      equipment after receiving at the service offices the subscriber’s      notification that the end-userequipment |
|--|-------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

    

----

|  |   | was      lost or stolen, or that there is a possibility that someone else is making      calls through the end-user equipment without having received permission to      do so; The subscriber may give such a notification by telephone or in      writing, including by fax or email; Upon receipt of a telephone      notification or immediately after receipt of a written notification, the      Licensee shall verify its reliability and disconnect the      service. |
|--|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 77A.3 | The      Licensee shall cooperate with other licensees in locating and preventing      fraud. |
|--|-------|-----------------------------------------------------------------------------------------------|

----

|   | Subject      to that stated in section 75, the Licensee may change the rate that was      set by it for any service or basket of services (in this section –      “service”), provided: |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (a) | It      submits to the Director a written notice giving details of the new rate,      before such rate goes into effect; |
|--------|-----|--------------------------------------------------------------------------------------------------------------------------|

|   | (b) | It      gave prior written notice to every subscriber who joined the service;      Notwithstanding that stated, notice regarding a reduction may be given to      the subscriber up to one month after the  reduction. |
|--------|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  |   | For      purposes of this section, “change” – any change in a rate resulting in an      increase or reduction in the payment before VAT which a subscriber is      required to pay for the      Licensee’s services. |
|--|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | In      case of an increase or reduction in any rate for cellular services according      to the provisions of the license, such increase or reduction shall not      apply to payments made for such a service prior to the starting date of      the increase or the reduction; An increase or reduction shall apply only      to cellular services      provided to a subscriber after the date of the increase or reduction; This      section shall not apply to a rate adjustment ordered by the Minister under      section 83(A). |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 80.1 | The      Licensee may debit a subscriber arrears interest, linkage differences and      collection costs on payments for cellular services which      were not paid by a subscriber on their stipulated payment date, in a      payment notice sent to the subscriber, according to the contract between      themA33)      (hereinafter – the payment date). |
|--|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 80.2 | VoidA43) |
|------|----------|

|  | 80.3 | The      amount of the arrears interest shall not exceed the rate specified in the      definition of “linkage differences and interest” in section 1 of the      Adjudication of Interest and Linkage Law, 1961, plus linkage differences      for the period between the stipulated payment date and the actual payment      date of the specified amount. |
|--|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 80.4 | A33)The      Licensee may debit a subscriber collection costs on a payment for a      service which it provided to the subscriber, which was not paid on the      payment date (hereinafter – the amount of the debt), provided at least      fourteen (14) days have elapsed from the payment date, excluding a case of      nonpayment due to the bank’s or the credit-card company’s refusal to pay a      debit for the collection of which the Licensee received an authorization;      The amount of the collection costs to be collected by the Licensee shall      be reasonable and in proportion to the amount of the debt and the actions      which the Licensee must take in order to collect it.: In this regard,      “collection costs” – including legal handling by the Licensee or someone      acting on its behalf, of the collection of the amount of the debt before      application is made to the courts. |
|--|------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | If      the Licensee decides to collect a connection fee as defined in section      74(A), it may debit a subscriber a connection fee only for the connection      of the subscriber for the first time to the cellular network and the      provision of the cellular services, or for a      connection after the termination of a service under section 71 or the      termination or disconnection of a service under section  72. |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | The      Licensee may collect the connection fee as stated in section 81 for      connection to the cellular system in a number      of installments, at the times agreed upon with the subscriber and in the      amount specified in the contract. |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (a) | If      the Minister finds that any of the Licensee’s rates or any payment      required to be made to or through the Licensee is contrary to the      provisions of the License, the Minister shall notify the Licensee in that      regard, indicating the correction that needs to be made and that if the      Licensee fails to do so, the Minister will act pursuant to his power under      sections 5 and 15 of the Law; The Licensee shall send the Minister a      written notification setting out the corrected rate and shall act to      refund the excess amount, if any, which a subscriber was debited according      to the rate prior to itscorrection. |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (b) | If      the Minister finds that any of the Licensee’s rates or any payment      required to be made to or through the Licensee is unreasonable or is      liable to harm competition or the consumers, the Minister shall notify the      Licensee in that regard, indicating the correction that needs to be made      and that if the Licensee fails to do so, the Minister will act pursuant to      his power under sections 5 and 15 of the Law; The Licensee shall send the      Minister a written notification setting out the corrected    rate |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|  | 84.1 | The      Licensee shall pay royalties as prescribed in the Telecommunications      Regulations (Royalties), 2001, or in any other regulations replacing them      (hereinafter – “the      Royalties Regulations”). |
|--|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 84.2 | To      every payment of royalties under this section the Licensee shall attach      two copies of an unaudited quarterly income report, signed by the Licensee      and certified by an accountant; The report shall contain a detailed      calculation of the liable income according to the Royalties Regulations,      and any other particular on which the Licensee based the amount of the      royalties. |
|--|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 84.3 | Upon      the submission of an annual income report audited and signed by the      Licensee’s accountant (hereinafter: “the audited report”),      the Licensee shall submit a report, prepared by quarters, setting out the      adjustment between the income on which it paid royalties, and the income      appearing in the audited report (hereinafter – “the adjustment      report”). |
|--|------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 84.4 | If      it becomes apparent that the amount of the royalties to be paid by the      Licensee, according to the adjustment report, is greater than the amount      paid by it for the quarter to which the audited report relates, the      Licensee shall pay royalties differences, in addition to interest and      linkage differences, as prescribed in the Royalties      Regulations. |
|--|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 84.5 | If      it becomes apparent that the amount of the royalties paid by the Licensee      is greater than the amount it was required to pay for the quarter to which      the audited report relates, the Licensee shall be credited with the amount      of the excess payment; The excess payments to which the Licensee is      entitled shall be offset, pursuant to a written approval of the Director,      from the next payment of royalties, and linkage differences and interest      shall be calculated according to the last index published before the date      of the offset; In this regard – interest and linkage differences, as      prescribed in the RoyaltiesRegulations. |
|--|------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | The      Licensee shall pay linkage differences, arrears interest and collection      costs, as set forth in the Royalties Regulations, on royalties that were      not paid at the time stipulated therefor in the    regulations. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Royalties      as well as linkage differences, arrears interest and collection costs in      respect thereof shall be paid to the Ministry of Communication’s      accountant by a bank transfer to the ministry’s  account. |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | The      royalties under this Part shall be in addition to any other fee, tax or      mandatory payment which the Licensee is required to pay under any      law. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | In      this Part, “use of the license” – setup, installation, maintenance, upkeep      or operation of the cellular system, whether by the Licensee itself or      through anyone acting on its behalf, including its employees, contractors,      agents or representatives. |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 89.1 | The      Licensee shall be liable at law for death, damage or loss to the body or      property of any person, directly or indirectly resulting from or      consequent on the use of thelicense. |
|--|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 89.2 | When      using the license, the Licensee shall take all reasonable precautions to      prevent damage or loss to the body or property of any person, and where      such damage or loss was caused due to the use of the license, the Licensee      shall repair the damage at its expense and compensate the aggrieved party,      all subject to any law, excluding a case in respect of which the Minister      granted the Licensee immunity as specified in section  90. |
|--|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | To      avoid doubt, this section shall not impose on the Licensee liability      beyond the liability in torts established in the regular law of      torts. |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 90.1 | The      Minister may, at the Licensee’s request, grant it all or any of the      immunities enumerated in Chapter I of the Law, subject to that stated in      section 90.3. |
|--|------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 90.2 | The      Licensee shall set out in its request the immunities which it is      requesting and the reasonstherefor. |
|--|------|--------------------------------------------------------------------------------------------------------------------|

|  | 90.3 | If      the Minister is persuaded of the necessity of granting the Licensee the      immunities under Chapter I of the Law, he shall publish his decision in a      notice in Reshumot. |
|--|------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 91.1 | The      Licensee shall make, at its expense, an insurance contract with a licensed      insurer according to the terms contained in section 92; The insurance      contract shall be presented to the Director at the time of the grant of      the license. |
|--|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 91.2 | The      Licensee shall indemnify the State in respect of any financial liability      as stated in section 89.1, for which it may be held liable towards a third      party due to the use of the license; Any indemnity under this section      shall be insured by the Licensee for liability  insurance. |
|--|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 91.3 | The      Licensee shall insure itself, including its employees and contractors,      against any financial liability as stated in section 89.1, for which it      may be held liable at law owing to damage caused to the body or property      of a person from the use of the license, and against any loss or damage      caused to all or a part of the cellular system from the use of the      license, including against third partyrisks. |
|--|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 91.4 | The      Licensee shall submit to the Director an opinion of a lawyer specializing      in insurance, confirming that the insurance policy covers everything      required in sections |
|--|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|  |   | 91.2      and 91.3; The Licensee shall attach to the opinion a copy of the insurance      contract and its attachments; Said documents shall be submitted to the      Director within 7 days of the signing of the insurance contract and shall      be attached to this license as AddendumG. |
|--|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|  | 92.1 | The      insurance contract shall specify the period of insurance and shall      stipulate that at the end of the period of insurance the insurance shall      be extended automatically. |
|--|------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 92.2 | The      Licensee shall present to the Director, once a year, the insurer’s      confirmation that the insurance contract is valid, there are no arrears in      the Licensee’s payments of the premiums and there are no pending notices      concerning the cancellation, suspension, limitation, amendment or      termination of the insurancecontract. |
|--|------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 92.3 | The      insurance contract shall stipulate that in the event the insurer wishes to      cancel the insurance contract, owing to nonpayment of the premium, it must      give the Director prior notice in that regard not less than 90 days before      the contract is actually due to be cancelled (hereinafter in this section      – cancellation notice). |
|--|------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 92.4 | If a      cancellation notice has been sent as stated in section 92.3, the Licensee      shall act immediately to eliminate the cause of the cancellation, or shall      act immediately to obtain an alternative insurance contract as stated in      section 92.6, and it shall notify the Director of the actions it took for      this purpose; Where the cause of cancellation was nonpayment of the      premium by the Licensee, the Director may pay the premium in the      Licensee’s stead, and he may exercise the bank guarantee or any part      thereof to cover amounts which he expended on payment of the premium or      collect them in any other manner. |
|--|------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 92.5 | If      the Licensee wishes to cancel the insurance contract, it must notify the      Director in that regard at least 45 days before the contract is actually      due to be cancelled. |
|--|------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 92.6 | If      the Licensee has agreed to the cancellation of the insurance contract by      the insurer or itself wishes to cancel the insurance contract, it shall      make an insurance contract with another licensed insurer, in such manner      that the new insurance contract will come into effect simultaneously with      the lapse of the previous contract; The new insurance contract shall be      submitted for approval to the Director, together with an opinion as stated      in section 91.4, 45 days before its effective date, and it shall be      subject to the provisions of the sections in this  Part. |
|--|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | If      the Licensee did not make an insurance contract, or if it becomes apparent      that the insurance contract which it made was cancelled or expired, the      Director may effect insurance and pay the premium in the Licensee’s stead,      and it may exercise the bank guarantee to cover amounts expended by it on      the insurance or collect them in any other manner; All the foregoing      without derogating from the authority to cancel, restrict or suspend the      license owing to the Licensee’s failure to effect insurance according to      the terms of this license. |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|  | 94.1 | A30)The      Licensee shall present to the Director an unconditional bank guarantee in      favor of the State of Israel, in shekels, equivalent to ten (10) million      US dollars, as security for fulfillment of the terms of the License; The      guarantee is attached to this license as Addendum H to the Second      Schedule. |
|--|------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 94.2 | The      guarantee shall serve as security for fulfillment of the terms of the      license and for compensation and indemnification of the State for any      damage, payment, loss, detriment or expense caused or liable to be caused      to the State – whether directly or indirectly – due to nonfulfillment of      all or any of the terms of the license, fully and on time, or due to the      cancellation, restriction or suspension of the  license. |
|--|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 95.1 | Without      derogating from the general purport of section 94.2, the Director may      exercise the guarantee, in whole or in part, if damage is caused due to      nonfulfillment of the terms of the license, including in each of the cases      set out below: |
|--|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (a) | The      State incurred a loss of income from royalties owing to a lack of revenues      from subscribers’ payments, including by reason  of: |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (1) | Failure      to operate the cellular services at a time stipulated therefore in the      timetable determined by the Director, or as approved by the      Director; |
|--------|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (2) | Discontinuation,      suspension or restriction ofservices; |
|--------|-----|-------------------------------------------------------------|

|   | (3) | Restriction      or suspension of the license; |
|--------|-----|------------------------------------------------|

|   | (b) | No      insurance contract was made according to sections 91-92, the premium was      not paid, or the insurance contract was cancelled or    expired; |
|--------|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (c) | The      Licensee is debiting its subscribers for payments contrary to that stated      in section 75; |
|--------|-----|--------------------------------------------------------------------------------------------------------|

|   | (d) | The      Licensee is not complying with the coverage and service quality      requirements as stated in Appendix B, or the Licensee consistently stops,      suspends or limits the service contrary to the provisions of the      license; |
|--------|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (e) | The      Licensee does not convert the cellular system to a digital technology by      the date specified in Appendix B. |
|--------|-----|--------------------------------------------------------------------------------------------------------------------------|

|   | (f) | The      Licensee consistently or willfully violates any of the provisions, terms      or requirements of the license; |
|--------|-----|------------------------------------------------------------------------------------------------------------------------|

|   | (g) | A      claim or demand was submitted against the State for payment of      compensation and damages due to a violation of a condition in the license      or faulty implementation of the license or due to the cancellation of the      license, and where the State incurred expenses due to such claim or      demand; The exercise of the |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   |   | guarantee      for the purpose of covering the amount of a claim as stated, shall be done      only after the judgment in that claim has become  absolute; |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (h) | Royalties      according to section 74 were not paid fully and on  time; |
|--------|-----|--------------------------------------------------------------------------|

|   | (i) | The      State incurred costs or damage due to the cancellation of the      license; |
|--------|-----|--------------------------------------------------------------------------------------|

|   | (j) | The      Licensee did not complete the guarantee fees as specified in sections 96.2      and 79.2. |
|--------|-----|----------------------------------------------------------------------------------------------------|

|   | (k) | A16)The      Licensee did not present the license fee on the required date, as      stipulated in section 40.1 of the conditions of Tender No.      1/01. |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (l) | A16)A      monetary sanction was imposed on the Licensee in accordance with the law,      and the required amount was not paid on time, provided no amount above the      amount of the sanction iscollected. |
|--------|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 95.2 | The      Director may exercise the guarantee as stated in this Part also by reason      of an expected violation of the terms of the license or frustration of the      terms of the license that justify, at his discretion, early exercise of      the guarantee. |
|--|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 96.1 | The      Director may exercise the guarantee, in whole or in part, up to the amount      specified therein, provided it warned the Licensee that if it does not      correct the act or omission the subject of the warning within the period      specified in the warning – the guarantee will be exercised, in whole or in      part. |
|--|------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 96.2 | If      the entire amount of the guarantee or a part thereof was exercised, the      Licensee shall provide a new guarantee or complete the balance up to the      original amount of the guarantee immediately upon the Director’s demand;      Failure to complete the amount of the guarantee as stated shall constitute      a material breach of the terms of the license, and the Director may –      without derogating from his authority to cancel, restrict or suspend the      license – exercise any remaining balance of the  guarantee. |
|--|------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 96.3 | The      Licensee may appeal a decision of the Director to exercise the guarantee,      in whole or in part, before the Minister within 15 days of being notified      of the Director’s decision. |
|--|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 97.1 | The      guarantee shall be valid throughout the term of validity of the license      and for A16)two      years after the end of the term of the license, or until the Licensee      satisfies all its obligations under the license to the Director’s      satisfaction – according to the later of these two  dates. |
|--|------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 97.2 | If      the Director determines that the Licensee did not satisfy all its      obligations under the license, within 60 days before the expiry of the      term of the guarantee, he may require the Licensee to extend the term of      the guarantee or to present a new guarantee, within the period specified      by the Director; The new guarantee shall be valid up to the date specified      by the Director or until the Licensee satisfies, to the Director’s      satisfaction, all its obligations under the licenses – according to the      later of these two dates; If the |
|--|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|  |   | Licensee      fails to present a new guarantee as stated, the Director may exercise the      guarantee. |
|--|--------|---------------------------------------------------------------------------------------------------------|

|  | 97.3 | Where      the Director confirmed receipt of a guarantee the validity of which may be      extended from time to time upon his demand, the Licensee shall extend the      validity of the guarantee before the expected end of its term, for a year,      unless the Director exempted it from this obligation; If the Director      did not grant an exemption from the obligation to extend the validity of      the guarantee, and the validity of the guarantee was not extended at the      specified time, the Director may exercise the guarantee in its entirety      without advance warning. |
|--|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|  | 98.1 | Exercise      of the guarantee, in whole or in part, does not derogate from the      authority to cancel, restrict or suspend the  license. |
|--|------|---------------------------------------------------------------------------------------------------------------------------------------------|

|  | 98.2 | The      amount of the guarantee shall not serve to limit the scope of the      Licensee’s liability towards the State for payment of the full damages      caused to it, where the Licensee is obligated to make such payment under      the license or by law. |
|--|------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 98.3 | The      exercise of the guarantee, in whole or in part, shall not derogate from      the Director’s right to demand from the Licensee in any other manner      payment for damages which it is obligated to cover under this license or      to exercise other reliefs that are available to him by  law. |
|--|------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | The      Director or anyone authorized by him for this purpose may supervise the      Licensee’s activities with respect to the implementation of the license      and compliance with the provisions of the Law, the Ordinance and the      Regulations pursuant thereto. |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | The      Director and anyone engaging on his behalf in supervising the Licensee      shall not disclose any information or document coming into their      possession by virtue of their function, to a person who is not authorized      to receive such information or document, unless it was already published      in public or disclosure is necessary for the performance of their function      under this license or by law. |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | For      the purpose of exercising the supervision as stated in this Part, the      Director may: |
|--------|---------------------------------------------------------------------------------------------------|

|   | (a) | Enter      at any reasonable time any facility or office used by the Licensee to      provide its services under thislicense. |
|--------|-----|-------------------------------------------------------------------------------------------------------------------------------|

|   | (b) | Carry      out measurements and tests on the cellular system, and he may inspect any      record, document, plan, account book, ledger or data base, whether regular      or computerized, of the Licensee or of anyone employed by the Licensee in      subjects over which the Director has supervisory power as stated; The      Director may inspect them and copy them in any manner he deems      fit. |
|--------|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | The      Licensee shall cooperate with the Director or with anyone authorized by      him with respect to the exercise of supervision over its activities as      stated, and without derogating from the general purport of the aforesaid,      it shall allow them to carry out that stated in sections 100 and 101 and      shall furnish to them, upon their demand, any information in its      possession or control that is required by them for the exercise of the      supervision. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|  | 103.1 | The      Licensee shall submit to the Director the reports specified in this      license, in the format and at the times stipulated in this      part. |
|--|-------|---------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 103.2 | Every      report shall reflect the correct facts relating to the subject thereof,      updated for the period of thereport. |
|--|-------|------------------------------------------------------------------------------------------------------------------------------|

|  | 103.3 | A      report shall be submitted in two (2) copies, printed and prepared in an      easily readable form, bearing the date of its preparation and signed by      the Licensee or whoever it authorized for this purpose; The report shall      be submitted in a format as directed by the Director, including with      respect to its contents, structure and manner of    submission. |
|--|-------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 103.4 | The      Director may require the Licensee to prepare anew or to complete a report      which it submitted, if he found it lacking in necessary details or details      which, in the Director’s opinion, should have been included by the      Licensee in the report. |
|--|-------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | The      Licensee shall submit to the Director, at his request and at least once a      year, at the end of the calendar year and not later than ninety (90) days      thereafter, annual reports describing its activity in the period from      January to December of the pastyear: |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (a) | Financial      statement audited and signed by anaccountant; |
|--------|-----|--------------------------------------------------------------|

|   | (b) | Subscribers      report, including the followingdata: |
|--------|-----|-------------------------------------------------------|

|   | (1) | Number      of subscribers broken down according to business and private subscribers      and according to post-paid andpre-paid; |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------------------|

|   | (2) | Amount      of income broken down according to subsection (1), with each type of      income from interconnection appearing separately, and broken down as well      according to airtime and added-valueservices. |
|--------|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (c) | Report      on the use of frequencies according to Chapter D Part    C; |
|--------|-----|-------------------------------------------------------------------------|

|   | (d) | Addendum      A – “Particulars of Licensee” updated as of the beginning of January, as      detailed in section 20.1. |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------------------------|

|  | 104.2 | The      Licensee shall submit to the Director once a quarter, not later than a      month after the end of the quarter, the following  reports: |
|--|-------|--------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (a) | Unaudited      quarterly financial statement signed by an  accountant; |
|--------|-----|------------------------------------------------------------------------|

|   | (b) | Unaudited      quarterly income report signed by an accountant, giving details of income      on which royalties are payable; |
|--------|-----|-------------------------------------------------------------------------------------------------------------------------------|

|   | (c) | Traffic      report – in a format as directed by the  Director. |
|--------|-----|-----------------------------------------------------------------------|

----

|  | 104.3 | The      Licensee shall submit a report on any special occurrence, as set out in      regulation 8 of the ControlRegulations. |
|--|-------|-------------------------------------------------------------------------------------------------------------------------------|

|  | 104.4 | The      Licensee shall submit to the Director the following report, at his      request: |
|--|-------|-------------------------------------------------------------------------------------------|

|   | (a) | Report      concerning development works of thenetwork; |
|--------|-----|---------------------------------------------------------|

|   | (b) | Malfunctions      report – containing a brief description and discussion of the malfunctions      that occurred in the network, the number of malfunctions and the      cumulative duration of malfunctions of each type, an analysis of the      malfunctions and the steps taken to repairthem; |
|--------|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (c) | Service      quality report – Analysis of the Licensee’s compliance with the      requirements of sections 49 to 51 and Addendum E – Level of Services for      Subscribers, during the period of thereport; |
|--------|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (d) | Complaints      report – detailing the written service complaints that were submitted by      subscribers, including the subject of the complaints, the dates on which      they were received, the written response given, the manner in which they      were dealt with and details of the activity of the Public      Ombudsman; |
|--------|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (e) | List      of the Licensee’s rates; |
|--------|-----|------------------------------------------|

|   | (f) | Updated      engineering program; |
|--------|-----|-----------------------------------|

|   | (g) | Encumbrances      report – The Licensee must report to the Director immediately any case of      imposition of an attachment or encumbrance on any of the Licensee’s assets      or any case of an encumbrance on means of control in the Licensee, any      realization of such encumbrances or voidance of any right of the Licensee      in an asset; The Licensee must also submit to the Director, at his      request, a report detailing all such  encumbrances. |
|--------|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (h) | Report      on number of subscribers, income and minutes broken down according to      private and business subscribers, and within each category – broken down      according to subscribers for programs priced according to an “inclusive      standard rate” and subscribers for programs priced separately for payment      in respect of “airtime” and interconnection, in a format as directed by      the Director; |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (i) | Nuisance      subscribers report as detailed in section65A.9; |
|--------|-----|---------------------------------------------------------------|

|   | (j) | Any      other data required for performance of control on the Licensee’s      activities, and any information required by the Ministry for regulating      the telecommunications sector. |
|--------|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 104.5 | The      Director may add or remove periodical, annual or quarterly reports, and he      may request the Licensee to submit special reports as directed by      him. |
|--|-------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|  | 105.1 | Where      the Director finds defects or deficiencies in the Licensee’s activities,      he shall notify the Licensee thereof inwriting. |
|--|-------|------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 105.2 | If      the Licensee received a notification as stated, it shall submit to the      Director, within thirty (30) days from receipt of the notification, its      written response detailing the measures taken by it to correct the defects      indicated therein. |
|--|-------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|  | 107.1 | The      Licensee’s rights, obligations and powers with respect to the setup,      maintenance and operation of the cellular system and the provision of      services by means thereof, originate in and derive exclusively from and      according to this license. |
|--|-------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 107.2 | Void.A2) |
|-------|----------|

|  | 108.1 | The      Licensee shall keep the license documents in its office and shall allow      the public to inspect their true and up-to-date copies; In case the terms      of the license are modified, the Licensee shall attach the modification      wording to said license documents. |
|--|-------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 108.2 | A16)If      the license and its documents are made available for public inspection,      the public shall not be allowed to inspect the following documents, which      are included in the Second Schedule to the  License: |
|--|-------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (a) | Appendix      A – Details of the Licensee; |
|--------|-----|--------------------------------------------------|

|   | (b) | Appendix      B – Engineering program; |
|--------|-----|----------------------------------------------|

|   | (c) | VoidA43); |
|--------|-----|-----------|

|   | (d) | Appendix      G – Insurance contract; |
|--------|-----|---------------------------------------------|

|   | (e) | Appendix      H – Bank guarantee; |
|--------|-----|-----------------------------------------|

|   | (f) | Appendix      I – Special services for the security forces;                                               |
|--------|-----|-----------------------------------------------------------------------------------------------------------------|
|   | (g) | Appendix      L – Special services for the security forces – security addendum      (confidential); |
|   | (h) | Appendix      M – Security directives;                                                                    |
|   | (i) | Appendix      N – Letters of undertaking.                                                                 |

|  | 108.3 | The      license documents are the property of the State and are entrusted to the      Licensee for the term of validity of the license; Upon the cancellation or      expiry of the license, the Licensee shall return the license with all its      documents to the Director. |
|--|-------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 108.4 | A16)The      Licensee shall allow the public to inspect the license documents via the      Internet; The Licensee may do this also by way of referral to the website      of the Ministry of Communications, as long as the Ministry publishes the      license on its website. |
|--|-------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 108.5 | A16)The      Ministry may publish the license, excluding the appendices indicated in      section 108.2, at the time and in the manner deemed fit by    it. |
|--|-------|-------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 109.1 | A      duty imposed on the Licensee in this license, for which a performance      deadline has been set, must be performed by the Licensee within the      deadline. |
|--|-------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 109.2 | A2)The      Director, at the Licensee’s request, may postpone a deadline set as      stated, if it deems it impossible to perform the duty within such deadline      for reasons of force majeure. |
|--|-------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | Any      approval or supervisory authority granted under this license to the      Minister or to the Director, including the exercise of such authority,      shall not impose on them any liability which is imposed by this license on      the Licensee, and shall not derogate or detract from or void or diminish      the Licensee’s liability as stated. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 111.1 | A      notice concerning this license or its implementation shall be in writing      and shall be delivered by hand or dispatched by registered post with      confirmation of delivery; A notice sent by registered post as stated shall      be presumed to have reached its destination by the end of 48 hours from      the time of its delivery fordispatch. |
|--|-------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 111.2 | Any      notice of the Licensee to the Minister shall be delivered or sent through      the Director. |
|--|-------|-------------------------------------------------------------------------------------------------------|

|  | 111.3 | The      Licensee’s address for receipt of notices under this section is: 10      Hagavish St., Poleg Industrial Area, Netanya 42140; The Licensee shall      notify the Director immediately of any changes in this      address. |
|--|-------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| 1. | General |
|----|---------|

|  | 1.1. | This      Schedule includes the list of services the Licensee will provide, under      the conditions set out in Section B of Chapter E – “Level of Services for      Subscribers”. |
|--|------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 1.2. | The      services will be provided in each of the technologies operated by the      Licensee, unless otherwise noted in the License or in the Schedule to the      License. |
|--|------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 1.3. | Wherever      the term: “Support in      Various Languages” is used, this denotes support in at least these      four languages: Hebrew, Arabic, English and  Russian. |
|--|------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 1.4. | A43)      The Licensee must include in the service dossier at least the      following details: |
|--|------|-------------------------------------------------------------------------------------------------|

|   | a. | Name of the service:      Name of the service, including its trade name and a general description of      the service. |
|--------|----|------------------------------------------------------------------------------------------------------------------------|

|   | b. | Detailed description of the      service: Among otherthings  – |
|--------|----|--------------------------------------------------------------------------------|

|   | c. | Engineering      description: |
|--------|----|-------------------------------|

|   | d. | Miscellaneous: |
|--------|----|----------------|

|   | 2.      List      of Services |
|--------|--------------------------------------------------------|

----

| No. | Name      of Service | Description      of Service                                                                                                                                                                                                                                                                    |   | Date      provided    |   | Measures      for quality of service | Remarks                                                 |
|-----|----------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-----------------------|--------|--------------------------------------|---------------------------------------------------------|
| 1.  | Cellular      Calls  | Telephone      calls to and from Licensee’s subscribers to any telephone or other      appropriate end user equipment in another public telecommunications      network in Israel or throughout the world                                                                                |   | Existing      service |   | 98%      availability                |                                                    |
| 2.  | Emergency      Calls | Free      dialing to emergency services determined by the Director (for example:      police, ambulance, fire dept., etc). Caller will be referred to the      emergency hotline according to the services provider’s definition with      reference to the subscriber’s location. |   | Existing      service |   | 98%      availability                | According      to the Director’s  rules |

| No. | Name      of Service        | Description      of Service                                                                                   | Date      provided    | Measures      for quality of service | Remarks |
|-----|-----------------------------|---------------------------------------------------------------------------------------------------------------|-----------------------|--------------------------------------|---------|
| 1.  | Call      Waiting           | Subscriber      may receive incoming calls while on another call. Subscriber may cancel      service at will. | Existing      service | 99.9%      availability              |    |
| 2.  | Selective      Call Waiting | Only      calls from a list of numbers defined by the subscriber will activate call      waiting alert        | Future      service   | 99.9%      availability              |    |
| 3.  | Call      Forwarding        | Diversion      of incoming calls to a phone number at the subscriber’s      choice:Always               | Existing      service | 99.9%      availability         |    |

----

|   |                           | When      busyWhen      call is not answered When      subscriber unavailable                                                                                                                                                        |                  |                    |                                     |
|--------|--------------------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-----------------------|-------------------------|------------------------------------------|
| 4.     | Selective      Call Forwarding | Diversion      of incoming calls according to a list of numbers predefined by the      subscriber, to another destination at the subscriber’schoice:·Always·When call is      not answered·When      busy  | Future      Service   | 99.9%      availability |                                     |
| 5.     | Call      Transfer             | Subscriber      may transfer call to another telephone number                                                                                                                                                                        | Future      Service   | 99.9%      availability |                                     |
| 6.     | Hunting      Group             | Determining      a leading number for a subscriber’s group of numbers: dialing the leading      number will refer the call to a free number in the group.                                                                      | Future      Service   | 99.9%      availability |                                     |
| 7.     | Caller      ID                 | Caller’s      number will appear on the screen                                                                                                                                                                                 | Existing      Service | 99.9%      availability | Depends      on caller's end device |
| 8.     | Calling      ID Restriction    | Allows      blocking subscriber’s number from appearing on call receiver’s screen.      Block may be permanent or one-time.                                                                                              | Existing      Service | 99.9%      availability |                                     |
| 9.     | Caller      Name Announcement  | Option      of identification of caller by voice signature                                                                                                                                                                           | Existing      Service | 99.9%      availability |                                     |
| 10.    | Conference      Call           | Establishing      a call for a number of subscribers simultaneously                                                                                                                                                                  | Existing      Service | 98%      availability   |                                     |
| 11.    | Closed      User Group         | A      group of phone numbers than may establish a call only among      themselves                                                                                                                                                   | Existing      Service | 98%      availability   | GSM      network only                    |
| 12.    | Voice      Mail                | Storing      messages of callers to the subscriber in a personal box and allowing      extraction of such                                                                                                                            | Existing      Service | 99%      availability   |                                     |

----

| 13. | Advanced      Voice Mail           | Voice      mail system as described in paragraph 12 above, with added “smart”      element, including visual or audio indication of messages waiting,      transfer of messages to other platforms and receiving messages from such      platforms. | Existing      Service                             | 98%      availability                                                                                     |                                                                                                           |
|-----|------------------------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|---------------------------------------------------|-----------------------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------------------|
| 14. | Voice      Mail Notification       | When      message received in voice mail box, the mail box will dial or send message      to destinations defined by subscriber                                                                                                                                 | Future      Service                               | 99.9%      availability                                                                                   |                                                                                                           |
| 15. | Voice      Activated Service       | Allows      operation of telephone and basic services, related services and value      added services by voice                                                                                                                                                  | Partialy      existing, Future Service expansion. | 70%      chance of correct identification in regions where signal strength is      better than 85dbm |                                                                                                           |
| 16. | Call      Tracking                 | Allows      subscriber to send the applicant an indication, while talking, for      purposes of later identification of source of call.                                                                                                                         | Future      Service                               | 99.9%      availability                                                                                   | Subject      to law                                                                                            |
| 17. | Virtual      Private Network (VPN) | Allows      short dialing according to a private numbering program                                                                                                                                                                                              | Existing      Service                             | 99.9%      availability                                                                                   | For      subscribers according to relevant types. Currently provided to business      sector.                  |
| 18. | Centrex                            | Allows      maintaining a private network while using networkresources                                                                                                                                                                                          | Future      Service                               |                                                                                                      |                                                                                                           |
| 19. | Facsimile      Services            | Allows      receiving, storing and extracting facsimile messages via    phone                                                                                                                                                                                   | Existing      Service                             | 99.9%      availability                                                                                   |                                                                                                           |
| 20. | Roaming                            | Allows      receiving, extracting and blocking messages abroad                                                                                                                                                                                                  | Existing      Service                             | 99.9%      availability                                                                                   | Subject      to availability of foreign operator. In GSM network in 3 months of      launching of the network. |

----

| 21. | GPRS      Roaming                  | Allows      using certain communications data services while using roaming      services                                                                                         | Future      Service   | 99.9%      availability                                         | Subject      to operator availability                          |
|-----|------------------------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-----------------------|-----------------------------------------------------------------|----------------------------------------------------------------|
| 22. | Toll      Free Call(1-800)         | Free      call to caller. Subscriber – call receiver – is charged for cost of      call.                                                                             | Future      Service   |                                                            | According      to numbering program and Director’s rules |
| 23. | Split      Charge(1-700)           | Splits      cost of call between call maker and subscriber receiver                                                                                                              | Future      Service   |                                                            | According      to numbering program and Director’s rules |
| 24. | Call      Screening                | Defining      a list of phone numbers subscriber will receive calls from. Call from      other numbers will be referred to another destination.                                  | Existing      Service | 99.9%      availability                                         |                                                           |
| 25. | Talk      Two                      | One      number for two end user equipment units.                                                                                                                                | Existing      Service | 99%      availability                                           |                                                           |
| 26. | One      number for two SIM cards  | cellular      services for two or more telephones in one number                                                                                                                  | Future      Service   | 99%      availability                                           |                                                           |
| 27. | Two      numbers for one SIM card  | Defining      two telephone numbers for the same SIM card                                                                                                                        | Future      Service   | 99%      availability                                           |                                                           |
| 28. | Change      of number announcement | A      caller to a subscriber will receive an announcement of the subscriber’s      new number, and will be given the option of directing the call to the new      number. | Existing      Service | 99.9%      availability                                         | GSM      network only                                          |
| 29. | Wake-up      Service               | Allows      subscriber to request the system call him at an hour    defined.                                                                                                     | Future      Service   | Precision      of service approx. 5 minutes. 99.9% availability |                                                           |

----

| 30. | Camp      on busy line            | Call      automatically put through to busy number when number frees    up.                                                                                                                                             | Future      Service   | 99.9%      availability |                                              |
|-----|-----------------------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-----------------------|-------------------------|---------------------------------------------------|
| 31. | Personal      Number Service      | Allows      subscriber to define calls to a certain number be forwarded to various      destinations according to parameters set by subscriber.                                                                         | Future      Service   | 99.9%      availability |                                              |
| 32. | Collect      Call                 | Cost      of call to be paid by subscriber receiver, after    confirmation.                                                                                                                                             | Existing      Service | 99.9%      availability | Between      licensed  subscribers only |
| 33. | Message      Distribution         | Distribution      of messages to a list of addressees, using various    platforms                                                                                                                                       | Future      Service   | 99.9%      availability |                                              |
| 34. | Hot      Billing                  | Provides      updated information to subscriber regarding his bill with the applicant      via various platforms                                                                                                        | Future      Service   | 99%      availability   |                                              |
| 35. | Over      the Air Services (OTA)  | Update      of data and applications on SIM card via SMS by the applicant. Running      applications from SIM card will be performed by subscriber, using end      device.                                              | Future      Service   | 99%      availability   |                                              |
| 36. | Account      Code Billing         | Splitting      charge for one phone number into separate accounts. Subscriber’s      instructions regarding the account to be billed will be performed by      punching a code at the beginning or during a call. | Future      Service   | 99%      availability   |                                              |
| 37. | Star      Services                | Allows      establishing a connection by dialing a short access code according to      applicant’s internal numbering program.                                                                                    | Existing      Service | 99.9%      availability |                                              |
| 38. | Short      Messages Service (SMS) | Allow      receiving and sending written messages via phone                                                                                                                                                             | Existing      Service | 99%      availability   | Depends  on      end user equipment     |

----

| 39. | Circuit      Switch Data (CSD)/High speed circuit switch data (HSCSD) | Access      to data service using a dial-up modem on phone or independent dial      modem                                                                                   | Existing      Service              | 98%      availability                                                                                 | Depends  on      end user equipment |
|-----|-----------------------------------------------------------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|------------------------------------|-------------------------------------------------------------------------------------------------------|-----------------------------------------------|
| 40. | Data      communications in Packet Switch                             | Subscriber      connection via phone or independent  modem to TCP/UDP/IP      communications for broadcastung using packet switch                                 | Existing      Service              | 98%      availability on best effort basis                                                            | Depends  on      end user equipment |
| 41. | Discontinuation      of Service                                       | Discontinuation      of service  upon subscriber's request                                                                                                        | Existing      Service              | Will      be performed  no later than the next business day after      subscriber's request |                                          |
| 42. | POC      (Push to Talk Over Cellular)                                 | Call      made by pressing a button on cellular end user equipmentCall      may be private (between subscriber and subscriber) or group on data      communications network | Service      Exists (just started) | According      to service file                                                                        | According      to temp. provision             |

| Temporary      Provision | The      Licensee will allow operation of Push to Talk Over Cellular services      (hereinafter: the Service) to any subscriber who is a legal entity      (individual or corporation), provided the number of users (number of      cellular end user equipment units permitted use of this service,      hereinafter – end user equipments) in the possession of such subscriber      does not exceed 20 during the first year starting on the date service      begins. Notwithstanding the aforesaid, should there be any considerable      changes in the cellular sector influencing provision of such service, the      Ministry will consider a shorter period.  |
|--------------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| Application              | This      service will not begin before Sunday, the 29th      day of Tamuz, 5764 (July 18, 2004)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |

----

| No. | Name      of Service                                        | Description      of Service                                                                                                                                                                                                                                                                                                          | Date      provided    | Measures      for quality of service | Remarks                                                               |
|-----|-------------------------------------------------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-----------------------|--------------------------------------|-----------------------------------------------------------------------|
| 1.  | Speaking      Clock                                         | Notice      of time                                                                                                                                                                                                                                                                                                                  | Future      Service   | 99.9%      availability              |                                                                  |
| 2.  | Directory      Assistance                                   | Allows      receiving information on phone numbers and automatic establishment of      calling number so given.                                                                                                                                                                                                                      | Future      service   | 99.9%      availability              |                                                                  |
| 3.  | Connectivity      to Information and Entertainment Services | Allows      subscriber to connect to information, entertainment, applications and      content services, whether interactive or noniteractive, whether by      download, by upload, or by various means of access.                                                                                                                   | Existing      service | 99.9%      availability         | Depends      on end user equipment. Subject to Director’s rules |
| 4.  | Access      to Internet Provider Services                   | Allows      subscriber access to internet provider.                                                                                                                                                                                                                                                                                  | Future      Service   |                                 |                                                                  |
| 5.  | Location      Based Information & Tracking              | Receiving      and sending information depending on location of phone, subject to      law.                                                                                                                                                                                                                                          | Future      Service   |                                 |                                                                  |
| 6.  | M-Commerce                                                  | Connection      via end user equipment for performing transactions                                                                                                                                                                                                                                                                   | Existing      Service |                                 | Depends      on end user equipment. Subject to Director’s rules |
| 7.  | Unified      Messaging                                      | Allows      subscriber to receive and send voice messages, speaking messages, faxes,      SMS, E-mail messages, application messages and multimedia files, to and      from unified cell, allowing the convertion of the data received from one      format to another, as well as access to data from various means of      access. | Future      Service   |  99.9%      availability        | Depends      on end device                                       |

----

| 8.  | Telemetry      Command and Control   | Use      of phone or cellular modem for receiving indication and sending orders      concerning various device operation (for example: alarm systems, inventory      systems, traffic lights, controllers, etc.)                                                                                                     | Existing      Service | 99.9%      availability |                                                 |
|-----|--------------------------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-----------------------|-------------------------|------------------------------------------------------|
| 9.  | Sponsored      Call                  | Connection      during which subscriber will be exposed to commercial information and      advertisements                                                                                                                                                                                                            | Future      Service   |                    | Subject      to law                                  |
| 10. | Video      Conference                | Allows      visual and audio communication between a number of users.                                                                                                                                                                                                                                                | Future      Service   |                    | Depends      on end  device                |
| 11. | Instant      Messaging               | Message      transfer service between “community” participants, organizations, groups      of friends, groups of people with same interests. Subscriber notifies he      is on network and ready to receive messages. Service notifies subscriber      members of group who are in geographic proximity. | Future      Service   |                    |                                                 |
| 12. | Surf      & Talk                 | Allows      subscriber to receive an indication of call waiting and reply while      connected to internet                                                                                                                                                                                                           | Existing      Service | 99%      availability   | Depends      on end user equipment. GSM network only |
| 13. | Personal      Information Management | Access      and synchronization via end user equipment to personal data      base.                                                                                                                                                                                                                                   | Existing      Service |                    | Depends      on end user equipment.                  |

|   | · | availability of service is the      percentage of time the service is available, not including availability of      basic services. |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------|

----

| Appendix      A     | Particulars      of Licensee – not available to public;                     |
|---------------------|-----------------------------------------------------------------------------------|
| Appendix      BA16  | Engineering      Plan - not available to public;                                  |
| Appendix      C     | Maintenance      Scheme - not available to public;                                |
| Appendix      D     | Uniform      Engagement Agreement – not attached;                           |
| Appendix      EA16  | Level      of Subscriber Services;                                                |
| Appendix      FA8   | Void;                                                                             |
| Appendix      G     | Insurance      Contract - not available to public;                                |
| Appendix      HA16  | Bank      Guarantee - not available to public;                                    |
| Appendix      It3t5 | Special      Services for security forces - not available to public;              |
| Appendix      JA6   | Access      to International Communications Services;                             |
| Appendix      KA7   | Discontinuation      of Services for cellular end user equipments of IS-54  type; |
| Appendix      LA12  | Special      Services for security forces - not available to public;              |
| Appendix      MA12  | Security      Instructions - not available to public;                             |
| Appendix      NA16  | Letters      of Undertaking - not available to public;                            |
| Appendix      OA24  | Erotic      Services                                                              |

----

  

  

----

----

| 1. | System      Performance |
|----|-------------------------|

|   |                                                                                                                                        |                                                                                                                                                                                                                                                                                                          |                                                                                                                                                   |                                                                                                                                                                                                                                                                                                 |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 1.1.   | The      system and its services will fulfill performances, qualities and measures      defined in the Engineering Plan – Appendix B. |
|   |                                                                                                                                        |                                                                                                                                                                                                                                                                                                          |                                                                                                                                                   |                                                                                                                                                                                                                                                                                                 |
| 1.2.   | The      system performance and services will not fall, in any event, from the      following minimum requirements:                         |
|   |                                                                                                                                        |                                                                                                                                                                                                                                                                                                          |                                                                                                                                                   |                                                                                                                                                                                                                                                                                                 |
|   | 1.2.1.                                                                                                                                      | Digital Technology: the      system and the services under the extension of the license will be      operated using digital technologies, according to relevant international      standards.                                                                                                                 |
|   |                                                                                                                                        |                                                                                                                                                                                                                                                                                                          |                                                                                                                                                   |                                                                                                                                                                                                                                                                                                 |
|   | 1.2.2.                                                                                                                                      | Service Coverage:                                                                                                                                                                                                                                                                                             |
|   |                                                                                                                                        | Subject      to the provisions of section 60.5 of the license, all services will be      provided in the entire coverage area of the system, keeping up minimum      requirements in the matter of quality of service, for twenty four (24)      months from the date on which the service for pay commences. |
|   |                                                                                                                                        |                                                                                                                                                                                                                                                                                                          |                                                                                                                                                   |                                                                                                                                                                                                                                                                                                 |
|   | 1.2.3.                                                                                                                                      | Quality of      Service:                                                                                                                                                                                                                                                                                      |
|   |                                                                                                                                        |                                                                                                                                                                                                                                                                                                          |                                                                                                                                                   |
|   |                                                                                                                                        | (A)                                                                                                                                                                                                                                                                                                           | In      this section:                                                                                                                                  |
|   |                                                                                                                                        |                                                                                                                                                                                                                                                                                                          |                                                                                                                                                   |                                                                                                                                                                                                                                                                                                 |
|   |                                                                                                                                        |                                                                                                                                                                                                                                                                                                          | (1)                                                                                                                                                    | “Blocked Calls”: calls      that cannot be established or messages that cannot be sent immediately      upon entering the order to connect because of non-availability of cellular      system resources or resources for connection between the cellular system      and other systems; |
|   |                                                                                                                                        |                                                                                                                                                                                                                                                                                                          |                                                                                                                                                   |                                                                                                                                                                                                                                                                                                 |
|   |                                                                                                                                        |                                                                                                                                                                                                                                                                                                          | (2)                                                                                                                                                    | “Dropped Calls” – calls      stopped not by the initiative of the subscriber caller/connector or that      of the receiving subscriber;                                                                                                                                            |
|   |                                                                                                                                        |                                                                                                                                                                                                                                                                                                          |                                                                                                                                                   |                                                                                                                                                                                                                                                                                                 |
|   |                                                                                                                                        | (B)                                                                                                                                                                                                                                                                                                           | Quality      of service in cellular system will not be less than the    following:                                                                     |
|   |                                                                                                                                        |                                                                                                                                                                                                                                                                                                          |                                                                                                                                                   |                                                                                                                                                                                                                                                                                                 |
|   |                                                                                                                                        |                                                                                                                                                                                                                                                                                                          | (1)                                                                                                                                                    | the      amount of blocked calls during hours of maximum use will not exceed two      percent (2%);                                                                                                                                                                                                  |
|   |                                                                                                                                        |                                                                                                                                                                                                                                                                                                          |                                                                                                                                                   |                                                                                                                                                                                                                                                                                                 |
|   |                                                                                                                                        |                                                                                                                                                                                                                                                                                                          | (2)                                                                                                                                                    | The      amount of dropped calls during hours of maximum use will not exceed two      percent (2%);                                                                                                                                                                                                  |
|   |                                                                                                                                        |                                                                                                                                                                                                                                                                                                          |                                                                                                                                                   |
|   |                                                                                                                                        | (C)                                                                                                                                                                                                                                                                                                           | The      system will uphold the requirements set out in sub-sections (A) and (B)      ninety-nine percent (99%) of the time during maximum use  hours; |

----

|   |   | (D)    | Subject      to the provisions of section 60.5 of the license, the system will reach      the level of requirements set out above by no later than twenty four (24)      months from the date of start of provision of such services for pay; from      that time, said quality of service will be upheld in all the system’s      coverage areas; |
|--------|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   |   |                                                                                                                                                                                                                                                                                                                                                     |
|   |   | (E)    | The      number of blocked and dropped calls will be measured as  follows:                                                                                                                                                                                                                                                                               |
|   |   |   |                                                                                                                                                                                                                                                                                                                                                     |   |
|   |   |   | (1)                                                                                                                                                                                                                                                                                                                                                      | measure      will relate to the time span of one hour; |
|   |   |   | (2)                                                                                                                                                                                                                                                                                                                                                 | the      maximum use hour to which the measure will refer will be the busiest hour      of the system, on the day the measure is taken;     |
|   |   |   | (3)                                                                                                                                                                                                                                                                                                                                                      | The      measure will be taken at the maximum use hours on each of five (5)      consecutive work days as stated; |
|   |   |   | (4)                                                                                                                                                                                                                                                                                                                                                      | The      final number indicating the likelihood of blocked and dropped calls will      refer to the average of the five (5) measured over the five (5) said      consecutive work days, and for each type of service provided by the      system; |
|   |   |   |                                                                                                                                                                                                                                                                                                                                                     |   |

|   |   | (F) | Measurement      and calculation will be performed for each cell separately, for each      switch separately, and for the entire system; notwithstanding the      aforesaid, at the written request of the Licensee, the Director may allow      exceptions to the provisions of section 1.2.3, after having been satisfied      that there is a true difficulty in performing the measure and calculations      as stated, provided an alternative measuring and calculation system is      proposed. |
|--------|--------|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 2. | Customer      and Subscriber Services QualityMeasures |
|----|-------------------------------------------------------|

| 2.1. | Services for provision of      information to customers and subscribers: will be given by referral      to call centers, at service centers, at the internet site, by e- mail, by      telephone and by facsimile. |
|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 2.2. | Standards for      accessibility and provision of  information: |
|------|-----------------------------------------------------------------|

|   | (A) | A      call center will be available twenty four (24) hours a day, all days of      the week except on Yom Kippur. |
|--------|-----|--------------------------------------------------------------------------------------------------------------------|

|   | (B) | The      call center will be manned at least thirteen (13) hours a day Sundays      through Fridays, and five (5) hours a day on Fridays and eves of      holidays. |
|--------|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (C) | The      reply at the call center will be within a reasonable time. Should the      Director observe that the waiting time at the call center is not      reasonable, he may set measures for response  time. |
|--------|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | (D) | A      caller to a call center during unmanned hours will be referred to a      message box to leave a message, and will receive a reply on the following      day. |
|--------|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (E) | The      Licensee will operate additional channel allowing subscribers to contact      it for provision of information and for queries, such  as: |
|--------|-----|---------------------------------------------------------------------------------------------------------------------------------------------------|

|   | - | Computerized      voice system IVR; |
|--------|---|-------------------------------------|

|   | - | queries      via post; |
|--------|---|------------------------|

|   | - | queries      via fax; |
|--------|---|-----------------------|

|   | - | queries      via e mail. |
|--------|---|--------------------------|

|   | (F) | The      Licensee will publish its service office address and telephone number of      the call center in the following ways, among  others: |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------|

|   | - | In      the engagement agreement with thesubscriber; |
|--------|---|------------------------------------------------------|

|   | - | In      the bills sent to the subscriber; |
|--------|---|-------------------------------------------|

|   | - | In      any document sent on behalf of the Licensee to the subscriber in a matter      relating to customer services; |
|--------|---|-----------------------------------------------------------------------------------------------------------------------|

|   | - | In      telephone directories and in telephone information  centers. |
|--------|---|----------------------------------------------------------------------|

| 2.3. | Bills to      Subscribers |
|------|---------------------------|

|   | (A) | Bills      to subscribers will set out the relevant details for such bill, out of the      following: |
|--------|-----|-------------------------------------------------------------------------------------------------------|

|   |  (1) | monthly      charge (fixed charge) |
|--------|-----------|------------------------------------|

|   |  (2) | duration      of calls or air time (minutes,seconds) |
|--------|-----------|------------------------------------------------------|

|   |  (3) | volume      of data use (MB,kB) – if the service provided is charge by volume of data      transmitted. |
|--------|-----------|---------------------------------------------------------------------------------------------------------------|

|   |  (4) | Other      charges (such as for receipt of data, SMS transmission, mobile electronic      commerce). |
|--------|-----------|------------------------------------------------------------------------------------------------------|

|   |  (5) | Combination      of the above charge methods. |
|--------|-----------|-----------------------------------------------|

|   | (B) | Structure of the      Bill |
|--------|-----|----------------------------|

----

|   | (C) | Production and      delivery of bills |
|--------|-----|---------------------------------------|

|   | (1) | The      Licensee will produce monthly bills for its subscribers or at any other      time with subscriber’s consent. |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------------|

|   | (2) | A      subscriber wishing to disengage with the Licensee will receive a final      bill on the closest date possible, and no later than two months from the      date of disengagement. |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (3) | Subscriber      bills may be obtained via post or via any other means agreed upon with the      subscriber, and to the address chosen by the  subscriber. |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------|

| 2.4. | A43)Measures for Handling      Public’s Applications |
|------|------------------------------------------------------------|

|   | (A) | Level      of handling a written complaint – The response times for complaints will      be up to 14 workdays; the response for 5% of complaints will be within a      month. |
|--------|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (B) | Measures      for quality of service of the service centers– |
|--------|-----|--------------------------------------------------------------------|

|   | - | 90%      of applications will be handled directly by the service representatives,      up to completion. |
|--------|---|----------------------------------------------------------------------------------------------------------|

|   | - | Not      more than 10% of applications, some due to escalation of complaints, will      be referred to more senior levels. |
|--------|---|----------------------------------------------------------------------------------------------------------------------------|

|   | (C) | Applications      clarified by the senior level – In any case where the Public Ombudsman’s      reply to a complaint does not satisfy the applicant, the application will      be passed on to the managerial level, which will examine the it again and      reply directly to the applicant. In any event, the applicant will receive      a response within 30 days from the day of his  application. |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| 1.   | Definitions |
|----------------|-------------|

|  | 1.1 | In      this document, the following words and terms will have the definitions      noted at their sides, unless otherwise deriving from the language or      context: |
|--|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Bezeq      International  -          |   | The      Bezeq International Company Ltd. ;                                                                                                                                                                                                                                                                                                                                                                                                             |
|------------------------------------------------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| Barak      -                                   |   | Barak      I.T.C. (1995) Company for International Telecommunications      Services;                                                                                                                                                                                                                                                                                                                                                                    |
| Chance      caller -                           |   | A      Licensee subscriber, calling abroad using an international operator, using      a three digit dialing code, as set out in section 2;                                                                                                                                                                                                                                                                                                             |
| Subscriber      number (or telephone number) - |   | A      group of numbers in a certain order, including area code, the dialing of      which should create a telecommunication’s connection between the reading      subscriber’s end user equipment and the reader subscriber’s end user      equipment; a reader subscriber number may be a subscriber number of a      number to a call answering center of a subscriber or a number to a call      answering center of a licensee2  |
| International      operator -                  |   | Anyone      providing international telecommunications services to the public in      Israel under a general license from the Director;                                                                                                                                                                                                                                                                                                                 |
| Chosen      operator -                         |   | An      international operator chosen by appointment, under the provisions of      section 43                                                                                                                                                                                                                                                                                                                                                                |
| Access      code -                             |   | A      group of numbers in a certain order, the dialing of which allows access to      a certain telecommunications service of a certain operator; dialing      additional codes, as needed, and the subscriber number, should create a      telecommunication connection to the subscriber’s end user equipment4      ; if the access code is a manned call center, the service is given via the      operator.                                       |

----

  

  

----

| Short      dialing code -                       |   | “00”      ” and “188” access code, designated to receive international      telecommunications services, by direct dialing, or via an operator, as      explained in section 2;                        |
|-------------------------------------------------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| Golden      Lines -                             |   | The      Golden Lines International Communications Services Company;                                                                                                                                                                 |
| Subscriber      ascription                      |   | The      technically defining action an internal operator performs in his switch so      that his subscriber’s calls, performed through a shortened dialing code,      are channeled into the chosen operator’s switch;  |
| Outgoing      ITMS calls -                      |   |  Transferring      a verbal message or facsimile message via an international      telecommunications service, initiated by a Licensee      subscriber;                                                                         |
| Ingoing      ITMS calls -                       |   | Transferring      a verbal message or facsimile message via an international      telecommunications service, initiated by an international      caller;                                                                             |
| InternationalTelecommunications      Services - |   | Telecommunications      services given to the public in Israel, under license from the Director,      via an international operator’s international telecommunication      services;                                           |
|  ITMS      service                         |   | International      telecommunications message service, that is, two-directional simultaneous      transfer of talk and simultaneous transfer of facsimile messages, in an      international telecommunications system.              |

|  | 1.2 | Words      and expressions in this document not defined above shall have the meaning      as defined in the Law, regulations enacted by virtue thereof, in the      Interpretation Law, 5741 – 1981, or as set out in the appropriate places      in the Licensee’s general license and in the International Operators’      licenses, unless otherwise deriving from the language or      context. |
|--|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 2.1 | A      Licensee will channel subscriber dialing, to the international operators’      switches, for access to international telecommunications’ services, using      the following codes: |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | (A) | double-digit access code      – the ‘00’ access code, which will serve as short access code for      international telecommunications services provided by a |
|--|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|  |   | chosen      operator; the Licensee will channel a subscriber dialing the prefix ‘00’      to the chosen operator; |
|--|--------|-------------------------------------------------------------------------------------------------------------------------------|

|  | (B) | triple-digit access code      – an access code of ‘01X’ type, which will serve as an access code      for international telecommunications services provided to a chance user;      the Licensee will channel any subscriber dialing the prefix ‘01X’ code to      the international operator according to the X digit; the X digit is the      international operator’s code, according to the  following: |
|--|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | 1.  | ‘2’      – code for Golden Lines’services; |
|--|----------|--------------------------------------------------------------------|

|        | 2.       | ‘3’      – code for Barak services;              |
|--------|----------|--------------------------------------------------------------------|
|   | 3.  | ‘4’      – code for Bezeq Internationalservices; |

|  | (C) | ‘188’ access code – that      will serve as a number for operator services ; any subscriber dialing      ‘188’ will be channeled by the Licensee to the chosen operator’s operator      services; |
|--|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | (D) | four-digit access code –      numbers of the ‘18XY’ type, that will serve as an access code for various      international telecommunications services of any and all international      operators; any subscriber dialing ‘18XY’ will be channeled by the Licensee      to the international operator according to the X digit; the X digit is the      code of the international operator under section 2.1(B); the Y digit is      any number from 1 to 9 and the 0 digit; the use of the Y digit will be      determined by the Director, under advisement with the international      operators, in order to ensure uniformity and fair competition; each      international operator will be allocated ten (10) such four digit numbers/      these numbers will be accessible for both the chosen operator’s      subscribers and for chancecallers. |
|--|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 2.2   | If      the Licensee allows its subscriber the use of another short dial code      (such as +), instead of the “00” dial code (hereinafter: a special code),      all the provisions and rules applicable to the short “00” dial code will      apply to the special code as well. |
|-----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 2.3   | Dial      by pre-paid program for unidentified subscribers who are not blocked for      outgoing ITMS calls will be possible only using three-digit access codes      of the 01X type, and four-digit access codes of the 18XY type; upon      dialing a short access code or a special access code, a voice announcement      will be heard referring the customer to dial via said access codes      available to him. |
|-----------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 2A.      A23 | Subscriber      Access to Outgoing ITMS Calls :                                                      |
|--------------|------------------------------------------------------------------------------------------------------|
|         |                                                                                                 |
| 2A.1         | The      Licensee will allow subscribers to act as follows, with regard to outgoing      ITMS calls: |

| (A)   | as      an ascribed subscriber. |
|-----------------|---------------------------------|

----

| (B)   | As      blocked |
|-----------------|-----------------|

| (C)   | As a      chance caller only. |
|-----------------|-------------------------------|

| 3.   | Blocking Outgoing      International Calls and Removal of the  Blocking |
|----------------|-------------------------------------------------------------------------|

| 3.1 | The      Licensee will block outgoing ITMS calls, and may also block collect      incoming ITMS calls for any subscriber requesting to block access to      international services or subscribers for whom the international service      for outgoing ITMS calls has been stopped or cut off, in accordance with      the conditions of the License; the licensee may not block incoming ITMS      calls except collect calls. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3.2   | If a      block for outgoing ITMS calls has been implemented at a subscriber’s      request, the Licensee will remove the block as follows: A23 |
|-----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------|

| (A)   | If      the subscriber has asked to join, he will indicate his choice      international operator who shall serve as his “chosen operator”, by his      signature on the appropriate form; notice given by means of      facsimile  will be deemed notice in writing given to by the      subscriber in this matter. |
|-----------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (B)   | If      the subscriber has asked to be a chance caller, he will notify the      Licensee of such; if the notice is verbal, the Licensee will verify the      requesting party’s identity. |
|-----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3.3   | The      Licensee will perform the block for ITMS or removal thereof, performed in      accordance with the subscriber’s request, according to the      following: |
|-----------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (A)   | 70%      - Within one working day of receipt of notice; requests received after      1500 hours will be deemed having been received on the following work      day; |
|-----------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (B)   | 20%      - within two working days of receipt ofnotice; |
|-----------------|---------------------------------------------------------|

| (C)   | the      rest – within 5 working days. |
|-----------------|----------------------------------------------|

| 3.4   | The      Licensee will ensure that a subscriber who has blocked his outgoing ITMS      calls cannot make outgoing calls using ‘00’ dialing code, ‘01X’ dialing      code, ‘188’ or ‘18XY’ dialing codes, or using any other code that may come      in place thereof A23      . |
|-----------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3.5   | The      Licensee may collect reasonable payment for performance of a block for      outgoing ITMS calls or for removal of theblock. |
|-----------------|--------------------------------------------------------------------------------------------------------------------------------------|

| 3.6   | Notwithstanding      that stated in section 3., the Licensee will allow all its subscribers to      block outgoing ITMS calls before initiation of services for such      subscriber, free of charge. |
|-----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| 3.7   | The      Licensee will verify that all subscribers whose access to outgoing ITMS      calls has been blocked receive appropriate voice message when dialing      access codes or telephone numbers for international    services. |
|-----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3.8   | If a      subscriber who has chosen a chosen operator asks to block outgoing ITMS      calls, the Licensee shall notify such to the chosen operator, within seven      (7) working days of the date of performance of the  block. |
|-----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 4.   | Choosing a Chosen      Operator |
|----------------|---------------------------------|

| 4.1   | A      Licensee’s subscriber may notify the international operator in writing, on      a signed form approved by the Director, regarding his choice of a chosen      operator through whom such wishes to receive international      telecommunications services using ‘00’ or ‘188’ access codes; the form      will including the particulars of the subscriber – first name, last name      or name of corporation, ID number of ID number of the corporation, address      and telephone numbers the subscriber asks to define the international      operator as the chosen operator for, and the date and time when      instruction regarding the appointment was given. The form will explain      that any phone number may have one chosen operator only, and such will      fulfill the requirements prescribed in this matter in the international      operator’s license7      (hereinafter: the ascription form). |
|-----------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 4.2   | Subscribers      may change the chosen operator at any time by written notice on the      ascription form; for initial ascription made at the subscriber’s request,      the subscriber will not be asked to pay anything, however the subscriber      may be charged a reasonable fee for any change in the      ascription. |
|-----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 4.3   | The      chosen operator will send the Licensee notice regarding the subscriber’s      having chosen him as the chosen operator (hereinafter: ascription notice);      ascription notice will include the subscriber’s particulars - first name      and last name, address and telephone numbers the subscriber asked to      define the international operator as the chosen operator for, and the date      and time of the ascription form on which the subscriber signed; the chosen      operator will give ascription notice to the Licensee in accordance with      the ascription forms signed by him; ascription notice will be given via      magnetic media files, or in any other manner agreed upon between the      Licensee and the international operators. If two or more ascription      notices are given to the Licensee, relating to the same telephone number,      the sc will act in accordance with the ascription notice with the later      date and hour. |
|-----------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 4.4   | If a      person has asked to become a new Licensee subscriber, he must make note,      in the request to the international operator of his choice to engage with      as a chosen operator; the Licensee will allow any new subscriber to choose      a chosen operator for himself or to block the outgoing ITMS calls, or will      allow the subscriber to receive ITMS |
|-----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

7Attention is called to section 52.3 of the Bezeq license, and section 56.4 tothe Golden Lines and Barak license.

----

|    | services      as a chance caller only; ascription services to a chosen operator or      connection as a chance caller, and blocking outgoing ITMS calls will be      given to new subscribers, at the time of initial registration, free of      charge A23      . |
|--------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 4.5   | In      order to choose a chosen operator, and without derogating from the      aforesaid, the Licensee will act asfollows: |
|-----------------|-----------------------------------------------------------------------------------------------------------------------------|

| (A)   | the      Licensee will allow all subscribers having a subscriber line number to      choose one  chosen operator will be for certain subscriber      lines, and another for other subscriberlines; |
|-----------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (B)   | VoidA2A23      . |
|-----------------|------------------|

| (C)   | the      Licensee will perform ascription of a subscriber within one working day of      receipt of ascription notice form the chosen operator A2A23. |
|-----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------|

| (D)   | The      Licensee will report to the international operator regarding completion of      said subscriber ascription as stated in sub-clause (C) above, including      change of ascription at the time and under such plan as agreed upon      between the Licensee and the international operator; the report will      include particulars of the subscriber – first name, last name or name of      corporation, address and telephone numbers the subscriber asked to ascribe      to the international operator. |
|-----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (E)   | A20      The Licensee will send a daily modification file of subscriber ascription      to all international operators (hereinafter: the modification file),      containing the particulars of the subscribers who ascribed to the      international operator or who unsubscribed on that day. The modification      file will be handed over at the time and under such procedure as shall be      agreed upon between the Licensee and the international operator. The file      will include the particulars of the subscriber, including at least the      first name, last name or name of corporation, ID number of ID number of      the corporation, address and telephone numbers the subscriber asks to      define the international operator as the chosen operator for.  effect |
|-----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (F)   | The      Licensee may request that the Director allow in certain cases, all the      prescription of rules and limitations on the matter      of  subscriber ascription, the Licensee will set out the      technical or operational reasons on which such request is based; if the      Director consents to the Licensee’s said request, at his professional      discretion, the Director will prescribe the time frame for the      applicability of said rules andlimitation; |
|-----------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (G)   | The      Licensee will submit a written quarterly report to the Director, by the      15th      of the month following the end of the quarter; the information in the      report will be correct as of the last day of the calendar quarter      preceding the date of the report, and will include the      following: |
|-----------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

| (1)   | The      number of subscribers blocked form international telecommunications      services; |
|-----------------|---------------------------------------------------------------------------------------------|

| (2)   | The      number of subscriber engaged for international services using short      dialing codes or using special codes, for each of the international      operators; |
|-----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (3)   | A23      The number of subscribers engaged for international services as chance      dialers only. |
|-----------------|----------------------------------------------------------------------------------------------------|

| (H)   | If      there should be any disputes between the international operator or between      the Licensee and the international operator on the matter of a subscribers      choosing a chosen operator, the matter will resolved by the Director, or      resolved by an independent arbitrator appointed by the Director, at his      exclusive discretion. |
|-----------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 4.6   | The      Licensee will channel any subscriber dialing using the ‘00’ prefix or any      other special prefix for access to international telecommunications      services, or channeling a call to a Licensee’s subscriber located abroad      using an international operator (follow-me subscriber service) to the      chosen operator. |
|-----------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 5.   | Void A23 |
|----------------|----------|

| 6.   | Block for short      dialing code |
|----------------|-----------------------------------|

| 6.1   | Subject      to the provisions of this appendix, the Licensee will perform a block for      short dialing code for any subscriber so requestingA23      . |
|-----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------|

| 6.2   | The      Licensee will perform the block for short dialing code as follows: the      Licensee will channel the subscriber’s calls using the double-digit ‘00’      prefix and the ‘188’ prefix to an announcer playing a recorded      announcement stating the following in Hebrew, English, Arabic and Russian:      “This service is blocked, for further details please dial ___ (a telephone      number of the announcer under the provisions of section 6.7)A23      . |
|-----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 6.3   | Void      A23 |
|-----------------|---------------|

| 6.4   | Void      A23 |
|-----------------|---------------|

| 6.5   | Void      A23 |
|-----------------|---------------|

| 6.6   | Void      A23 |
|-----------------|---------------|

| 6.7   | The      Licensee will operate the voice announcement  24 hours a day,      including Saturdays and holidays, using such method and wording allowing a      subscriber to receive an explanation regarding the ascription and overseas      dialing, in Hebrew, English, Arabic and Russian; the explanation will      include the following matters: |
|-----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| (A)   | Performance      of ascription – the ascription process and where to call in order to      request the ascription form; |
|-----------------|-------------------------------------------------------------------------------------------------------------------------------|

| (B)   | How      one may make an international call when the subscription is blocked for      short dialing codes; |
|-----------------|------------------------------------------------------------------------------------------------------------|

| (C)   | The      option of blocking overseas dialing and the option of removing such      block; |
|-----------------|------------------------------------------------------------------------------------------|

| (D)   | Where      one may call in order to find out about additional matters – telephone      numbers of international operators. |
|-----------------|----------------------------------------------------------------------------------------------------------------------------------|

| 7.   | Interconnection |
|----------------|-----------------|

| 7.1   | The      Licensee will connect its system to all international telecommunications      system, directly or indirectly, according to the terms of its license, in      a manner allowing provision of international telecommunications services      to all subscribers through the international telecommunications services      of all international operators, including outgoing and incoming ITMS      calls, direct dialing, dialing through an operator (‘188’ service, as      stated in section 2.2(A)), “Direct Israel” services, collect service (from      abroad to Israel, from Israel abroad), international 1-800 service      (incoming and outgoing), calling card services, from any destination      abroad and to any destinationabroad. |
|-----------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 7.2   | The      technical, operational and commercial arrangements between the Licensee      and any international operator will allow the provision of the following      to all subscribers: |
|-----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (A)   | Quality      service, including service quality control and means for investigating and      dealing with subscriber’s complaints regarding quality of      service; |
|-----------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (B)   | Accurate      and precise billing of subscriber, including control over the billing and      means for investigating and dealing with subscriber’s complaints regarding      incorrect billing and tools and means of identification and prevention of      fraud and deception; |
|-----------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (C)   | Consumer      response to subscriber’s queries and questions, including tools and means      of providing an itemized bill for subscribers, and for investigating      subscriber’s queries in all matters related to receipt of international      services. |
|-----------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 7.3   | In      order to implement the provisions of this appendix, the Licensee will act,      inter alia, as follows: |
|-----------------|-----------------------------------------------------------------------------------------------------------------|

| (A)   | Allow      any subscriber who has not blocked outgoing international ITMS calls to      make international calls at any time via his chosen international operator      or as a chance caller, using dialing methods set out in section      2; |
|-----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| (B)   | Allow      all subscribers to change their chosen operators; this service will be      given in return for a reasonablecharge, |
|-----------------|--------------------------------------------------------------------------------------------------------------------------------|

| (C)   | Take      reasonable measures to prevent subscriber ascription to a chosen operator      without his knowledge or against the subscriber’s wishes (“slamming”);      these measures will include identification of the subscriber and      verification of the subscriber’s right to receive  service; |
|-----------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (D)   | Give      all subscribers, free of charge, service allowing them to identify the      name of their chosen operators; |
|-----------------|-----------------------------------------------------------------------------------------------------------------------|

| (E)   | The      Licensee will offer non-discriminatory conditions to all international      operators, including in all matters regarding the commercial conditions,      billing and collections arrangements, availability of connection      installations and quality of service; without derogating from the      generality of the aforesaid, the Licensee will provide service for all      international operators under equal conditions including in the matter of      interconnection, provision of infrastructure installations and connection      services to the network, performance of changes in switching, in      installations, protocols and networkinterface; |
|-----------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (F)   | The      conditions for interconnection between the Licensee’s system and the      international operator’s international telecommunications system will be      reasonable and non-discriminatory; if the parties have not reached any      agreement, the Minister will determine matters between    them; |
|-----------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (G)   | A      copy of any agreement between the Licensee and international operator in      the matter of interconnection will be delivered to the      Director; |
|-----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (H)   | Any      international operator requesting the particulars of a subscriber refusing      to make payments to the Licensee designated for the international operator      for services used via the international operator’s international      telecommunications system will be given over, whether such subscriber was      an ascription subscriber or a chance caller; these particulars will      include the first name, last name or name of corporation, ID number of ID      number of the corporation, address and telephone  number. |
|-----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (I) | A22      Allow international operators to collect payment directly for services      from   subscribers ascribed to such international operator,      and who have chosen to receive billing and collections services directly;      the Licensee will have any vital   information required by      the international operator at his disposal allowing the international      operator to provide billing and collection services for such aforesaid      ascribed subscribers; |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (J) | A22      Provide services under equal and non-discriminatory conditions and for      such charge not discriminating against an ascribed subscriber who has      chosen to receive billing and collection services from the international      operator. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| 7.4   | The      international operators will bear the costs of implementation of the      interconnection including the process of survey and blocking short dialing      codes, and, if so required, for a subscriber’s initial ascription to a      chosen operator; the rate of payments, as stated, will be determined under      negotiation between the Licensee and the international operator; the      Licensee’s shared expenses that cannot be ascribed to a particular      international operator will be divided equally between all international      operators; if the parties have not come to an arrangement, the Minister      will prescribe instructions in these matters, after giving the parties a      fair opportunity to argue their claims before  him. |
|-----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

t

| Definitions  | 1. | In      this appendix - |
|-------------------|----|-------------------------|

| “Old      technology phone” –        | A      cellular phone operating on IS-54 format;                                                                                                                                          |
|-------------------------------------------------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| “New      technology phone” -                   | A      cellular phone operating on IS-136 format;                                                                                                                                         |
|  “Upgradeable      telephone”  - |  An      old technology phone that may be upgraded to a new technology      phone;                                                                                                   |
|  “Date      of cessation of service” -     |  The      date on which the Licensee ceases to provide cellular services to an old      technology phone owner.                                                                      |
|  “Eligible      customer” -                |  The      Licensee’s subscriber or customer who has lawfully purchased an old      technology telephone and has not exchanged or upgraded it to a new      technology phone;   |
|  “Telephone      Number” -                 |  The      number of the cellular telephone given to a subscriber or customer who      lawfully purchased an old technology phone and connected to the Licensee’s      network; |
|  “Upgrade”      -                          |  Exchanging      the software version of the telephone  upgrades the telephone,      wherein it becomes a new technologyphone.                                             |

| Discontinuation      of service  | 2. | Notwithstanding      the aforesaid in section C of chapter E of the General License, the      Licensee may discontinue provision of cellular services to eligible      customers, provided all the following provisions apply:                                                                                                                                        |
|---------------------------------------|----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| Publication                           | 3. | (A)  The      Licensee will publish an appropriate notice under these provisions in      three of the largest newspapers in Israel, one of which is published in      Arabic, on the closest Friday to the date 30 days before the date of      cessation of service. (B)   The      Licensee will publish an appropriate notice under these |

----

|                             |   | provisions      in three of the largest newspapers in Israel, one of which is published in      Arabic, on the closest Friday to the date 30 days earlier than the end of      six months from the date of cessation of service.                                                                                                                                                                                                                                                                                      |
|----------------------------------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                             |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| Exchange      of telephone       | 4.     | The      Licensee will exchange an old technology telephone including all      accessories thereto, including a hands-off device, for a new technology      telephone, including all accessories thereto, for any eligible customer,      on the basis of accessory for accessory, including the installation      thereof, provided the new technology telephone is of no lesser features      than the new technology telephone’s features, free of any direct or      indirect charge to the customer.  |
| Upgrade                          | 5.     | The      Licensee will upgrade an eligible customer’s upgradeable telephone, free      of any direct or indirect charge to the customer.                                                                                                                                                                                                                                                                                                                                                                   |
| Telephone      number            | 6.     | The      Licensee will keep the telephone number allocated to any eligible customer      before the date of cessation of service for a period of six months from      the date of cessation of service; after this period the Licensee may      exchange the telephone number of an eligible customer who did not exchange      the old technology telephone to a new technology telephone or did not      upgrade an upgradeable phone during that period.                                                      |
| Notice      of Application  | 7.     | The      Licensee shall inform the Director in advance and in writing of the day of      Discontinuation of Service and of the days of Publication as detailed in      sub-sections 3(A) and (B) above and shall furnish the Director with copies      of the notices as published.                                                                                                                                                                                                                                   |
|                             |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| Period                           | 8.     | The      Licensee will fulfill the provisions of sections 4 and 5 above starting on      the date of publication prescribed in sub-section 3(A) above for a period      of 7 years from the date of cessation of service.                                                                                                                                                                                                                                                                                        |
| Conditions      of service       | 9.     | The      provisions of sections 4, 5 and 6 will be deemed a condition of service,      as defined in section 37B.(A)(1) of the Telecommunications      Law.                                                                                                                                                                                                                                                                                                                                                           |

 

----

t

36 e

| Licensee      -          | One      who has been given a general license by the Minister for provision of NDO      or cellular services;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|--------------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| Telephone      bill -    | A      bill given to the subscriber by the Licensee for services      provided;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| Writing      -           | Including      via facsimile or electronic mail;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| Service      number -    | A      number of digits allocated to an erotic services provider by the Licensee,      given by dialing a telephone number, subject to the provisions of the      numbering program and administrative provisions in this matter, the      dialing of which, following a dialed prefix, allows the subscriber access      to the service;                                                                                                                                                                                                                                                                                                                                                           |
| Services      provider - | One      who provides erotic services via the network, and payment for the service      is made through the telephone bill; in the matter of erotic services      provided through dialing a telephone number, access to the services is      achieved through a service number;                                                                                                                                                                                                                                                                                                                                                                                                                    |
| Erotic      promo        | Broadcast      or presentation of an audio or visual message with sexual content,      including a recorded message, given via a telecommunications facility,      directly or indirectly, and such message is intended to provide      information on a service following or to encourage the use thereof,      provided the broadcast of the message or presentation are made without      additional charge beyond the charge for a telephone call collected via the      telephone bill;In      this matter, “indirectly” – including by way of creating a connection from      the subscriber’s end user equipment as a condition of providing the erotic      promo.  |
| Area      code           | A      national area code in such model as prescribed by the Ministry for erotic      services;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| The      network -       | The      Licensee’s public telecommunications network.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| Erotic      services -   | Audio      broadcast or presentation of an audio or visual message with sexual      content, including recorded messages, given via a telecommunications      facility, directly or indirectly, including services      for  dating, chats, or sending messages between chance callers,      designated or serving, even in part, for sexual purposes,                                                                                                                                                                                                                                                                                                                                         |

----

  

----

|                       |  which      are any of the following:  (1)  A      service provided through the dialing of a telephone number given by a      service provider; (2)  An      access service to a closed data base of contents including multimedia      files, held by the Licensee or by another provider of the service with the      Licensee’s consent (hereinafter: the “cellular      portal”).In      this matter, “indirectly” – including by way of creating a connection from      the subscriber’s end user equipment as a condition of providing the      service or for charging for it;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
|----------------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
| Payment      regulations - | The      Communications Law (Telecommunications and Broadcasts) (Payment for      Telecommunications’ Services), 5765 – 2005;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| Special      payment -     |  A      price fixed as stated in section 6, which the subscriber is required to      pay for erotic services in addition to the regular payment;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| Payment      Per time -    | A      special payment, the rate of which is determined by the amount of time the      subscriber used the erotic service;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
| Regular      payment -     | One      of the following: (A)  For      a call within the network – a payment that does not exceed the fixed      charge according to the rate agreement between the subscriber and the      Licensee regarding a call to another subscriber in the same      network;(B)  For      a call from one cellular network to another cellular network or to a      NDONDO network – payment as set out in sub-section (A) plus a payment that      does not exceed NIS 0.50 per minute (including VAT);(C)  For      a call from the Bezeq company network to a cellular network – a charge      that does not exceed that prescribed by the letter D in table A in the      First Schedule of the Payment Regulations, plus NIS 0.50 per minute      (including VAT);(D)  For      a call from a NDONDO network, except the Bezeq company network, to a      cellular network – a charge that does not exceed the fixed charge      according to the rate agreement between NDO subscribers and NDO, with      respect to another subscriber number within the same network, plus NIS      0.50 per minute.(E)  For      erotic services given via the cellular portal – a charge that does not      exceed the fixed charge according to the rate agreement between the      subscriber and the Licensee with regard to access service to the cellular      portal. |
|                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |

| 2.1   | Subject      to the provisions of section 4, access to erotic services given through      dial-up will be made available to subscribers via an area code and service      number. |
|-----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| 3.   | Allocation of Service      Number |
|----------------|-----------------------------------|

| 3.1.   | In      the matter of erotic services provided by dial-up, the Licensee may      allocate a service number to a service provider; in such case, the      Licensee will allow the service provider to provide services to both the      Licensee’s subscribers as well as subscriber to other      licensees. |
|------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 4.   | Blocking      Access |
|----------------|----------------------|

| 4.1   | A.      A38      A Licensee will block access to erotic services from all end-user      equipments connected to the network; without derogating from the      aforesaid, for the purpose of blocking access to erotic services given      though the cellular portal, the Licensee may make use of a means of      blocking, including content filtering programs, provided they efficiently      block access to said service. B.      A38      Should the Ministry of Communications notify the Licensee that an erotic      promo is being given through the Licensee’s telephone line or network,      without access through a service number, the Licensee will cut off said      line, or block the line from receiving incoming      calls; |
|-----------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 4.2   | A      subscriber 18 years of age or more may request the Licensee remove a block      imposed as described in section 4.1AA38      from his end user equipment. |
|-----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 4.3   | A      request for such removal of a block will be made in writing, or verbally,      provided the Licensee has prescribed a procedure allowing accurate      identification of the requestingsubscriber. |
|-----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|            |                                                                                                                                                                                                                                           |
|-----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 4.4   | If a      subscriber has so requested a block removed, the Licensee will remove the      block within a reasonable time, in a manner allowing the subscriber access      to erotic services via the end user equipment in his      possession. |

| 4.5   | If a      block has been removed for erotic services as stated, and the subscriber      requests that his end user equipment again be blocked for such services,      the Licensee shall perform the block at the soonest possible opportunity,      and by no later than 2 work days from the date of receipt of the      subscriber’s request. |
|-----------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 4.6   | The      first removal of a block against erotic services, made at the subscriber’s      request as stated in sections 4.2 and 4.3 will be made free of charge; the      Licensee may charge the subscriber a reasonable fee for any additional      blocking access to erotic services or for additional removal of such      block, made at the subscriber’srequest. |
|-----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 5.   | Early      Registration |
|----------------|-------------------------|

| 5.1   | Notwithstanding      that stated in section 4 above, the Licensee may establish a duty of early      subscriber registration for receipt of a password, a submission of which      will be a precondition for receipt of erotic services. The provisions of      this section do not derogate from the provisions of      sections  4.2 and 4.3above. |
|-----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 6.   |  Special      Payment |
|----------------|----------------------------|

----

| 6.1   | If      special payment is prescribed for erotic services, the rate shall be fixed      by the Licensee or in agreement between the Licensee and the services      provider. |
|-----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 7.   | Charging the      Subscriber |
|----------------|------------------------------|

| 7.1.   | If      special payment is prescribed for erotic services, the Licensee’s phone      bill will show the payment for the service separately from charges for the      Licensee’s other services, unless the subscriber has requested      otherwise. |
|------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 7.2.   | The      Licensee shall provide the subscriber, upon demand and within ten (10)      working days, details of the special payment for erotic services as      follows: |
|------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (A)   | The      service number the serviceallocated; |
|-----------------|-----------------------------------------------|

| (B)   | The      date and time service was provided; |
|-----------------|----------------------------------------------|

| (C)   | Billing      time units – when charging per time – the number of time units charged or      the total amount of the special payment; in the case of a charge according      to traffic volume (such as MB, KB), the number of volume units      transferred; |
|-----------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (D)   | The      sum charged for the service. |
|-----------------|---------------------------------------|

| 8.   | Mandatory      Tender |
|----------------|-----------------------|

| 8.1   | If a      special payment has been fixed for erotic services provided through the      network, the Licensee, either himself or via the services provider, will      play a recorded message at the beginning of the call, containing the      following details: |
|-----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| A.   | The      essence of the service; |
|----------------|----------------------------------|

| B.   | Rate      of special payment for the service, according to payment per time or per      traffic volume, as the case may be; |
|----------------|-----------------------------------------------------------------------------------------------------------------------------|

| C.   | The      option to discontinue the service, without charge, before the signal is      heard, as stated in section 8.4. |
|----------------|------------------------------------------------------------------------------------------------------------------------|

| 8.2   | The      recorded message will be played in the language in which the erotic      service is provided, in comprehensible language, at a reasonable pace and      without recording defects. |
|-----------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 8.3   | At      the start of erotic services provided in a language not Hebrew, a message      will be played announcing the language in which the service is provided,      and after, the recorded message will be played, as stated in sections 8.1      and 8.2, in the language in which the service is  provided. |
|-----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 8.4   | Upon      completion of the recorded message, as stated in section 8.1, the caller      will have a 5 second interval, at the end of which a signal indicating the      start of the erotic services; if the caller disconnected the call before      the signal was heard, he will not be charged the special payment.      Alternatively, the caller will be asked to press a certain key on his end |
|-----------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|            | user      equipment in order to confirm that he desires to accept the service, and      will be charged the special payment only from the moment he so    acts.                                                                                                                                                                             |
|-----------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|            |                                                                                                                                                                                                                                                                                                                                        |
| 8.5   | If a      special payment is fixed for erotic services provided by access to the      cellular portal, the Licensee will notify subscribers regarding the price      of the service in an obvious and clear manner, providing the subscriber      the option to disconnect from the service without being charged the      special payment. |

| 9.   | Licensee –Services      Provider Relations |
|----------------|--------------------------------------------------|

| 9.1   | The      Licensee may allow a services provider to perform      telecommunications  operations via its installations in order to      provide erotic services; the services provider will be exempt from the      duty of obtaining a license for telecommunications services, under the      provisions of section 3(5) of theLaw. |
|-----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 9.2   | The      Licensee will include the provisions of this appendix, mutatis mutandis,      in the agreement between the Licensee and the services provider, in such      manner that the services provider will be obligated to fulfill said      provisions. |
|-----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 9.3   | The      Licensee will provide the Director with any agreement between such and a      services provider, upon demand. |
|-----------------|------------------------------------------------------------------------------------------------------------------------|

| 10.   | Interconnection |
|-----------------|-----------------|

| 10.1   | The      conditions for interconnection between the network and the Licensee’s      public telecommunications network, in all matters relating to provision of      billing and collection services by one Licensee to another licensee, for      purposes of provision of erotic services given via the network to another      licensee’s subscriber, will be formalized in an agreement between the      Licensee and the other licensee; if the parties cannot reach an agreement,      the Minister will decide on thematter. |
|------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2   | The      Licensee will, upon demand, provide the Director with a signed copy of all      agreement it has with other licensees in the matter of said      interconnection. |
|------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 11.   | General |
|-----------------|---------|

| 11.1   | The      Licensee will be responsible to handle all erotic services customer      complaints, in all matters relating to subscriber access to the service,      and problems of billing and collection in connection with the service, and      will establish a mechanism for dealing with customer queries for such      purpose; the services provider will be responsible to deal with subscriber      complaints in regard to service content. If the Licensee himself provides      the erotic services, the Licensee will be responsible to handle erotic      services customer complaints regarding the service content as      well. |
|------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 11.2   | The      Licensee may not disconnect, stop or harm the basic telephone services of      a subscriber who has used erotic services and refuses to pay for such,      however, the Licensee may disconnect such subscriber from continued use of      the erotic services. |
|------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 11.3   |  The      Licensee may not provide a subscriber’s particulars to another services      provider or to others, without the subscriber’s written consent , and only      after verification of the authenticity of such  consent. |
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| 11.4   | A      Licensee shall, within three (3) working days, provide any subscriber so      requesting the following particulars regarding the services provider,      without charge: |
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| A.   | The      name and address of the provider; |
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| B.   | The      telephone number at which such provider may be  reached. |
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| 11.5   | The      provisions of this appendix will apply, mutatis mutandis, to provision of      erotic services provided as a network service to the Licensee’s      subscribers only. |
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| 11.6   | The      Licensee may himself provide erotic services, and the provisions of this      appendix will apply thereto, mutatismutandis. |