1. General

Israel Aerospace Industries Ltd. (IAI) has devised principles which form the Code of Business Conduct. In addition to the principles and directives that are listed in the Company's procedures and in various guidelines, IAI has a "Code of Business Conduct" which is written and published. This document comprises principles and guidelines relating to the business conduct of the Company and its employees.

The Company's policy is to uphold the laws, the guidelines and the principles to which it is obligated in its activities, to defend the rules of ethics and to implement high standards for business management.

Every employee of the Company is obligated to ensure to uphold the detailed guidelines in the Code of Business Conduct.

In addition to the detailed guidelines of the Company's various fields of business, the document details the tasks assigned to the Vice President of Human Resources, who is the person responsible for the Code of Business Conduct and its implementation within the organizational framework. The document is based on laws which were legislated within the Knesset, and standards which were published on many subjects, especially employee relations and work conditions, norms and international behavioral guidelines, special group labor agreements - which were signed by the Company's management and the Employees' Organization - and Company guidelines and procedures which address the issue of business conduct. The detailed protocol in the list is attached to the document as an appendix.