Translation from the Hebrew. The binding version is in the Hebrew. Form 046 Public January 6 th, 2008 Reference:

Transcription

1 Translation from the Hebrew. The binding version is in the Hebrew. Form 046 Public January 6 th, 2008 Reference: The Securities Authority The Tel Aviv Stock Exchange Ltd. Immediate report on Convening of a Shareholders Meeting Regulation 36B (a) and 36C to Securities Regulations (Periodic and Immediate Reports), Explanation: If one of the items on the agenda of the Meeting is approval of a transaction with a controlling interest or approval of an exceptional proposal, Form 133 or Form 138, respectively, must be filled out. 1. On January 1 st, 2008, it was resolved to call a Special General Meeting, to be convened on Monday, February 11 th, 2008, at 11:30 am. The security listed in the Tel Aviv Stock Exchange the holder of which is eligible to participate in the meeting is Address: 23 Aranha Street, Millennium Tower (23 rd floor), Tel Aviv. 2. The determining date for eligibility to attend and vote at the Meeting, if any, is 24/1/ The agenda: a. See Attached document Explanation: Details of the items on the agenda: Alongside each of the items a description of the nature of the item will appear, stating the main facts required for properly understanding each matter requiring a vote at the Meeting, and the text of each proposed resolution or a brief description of its main points will appear. In addition, the majority required will be stated for each item on the agenda. Reference of former documents in this regard (referring does not constitute incorporation by reference): Former name of reporting entity: Form structure updated 02/12/2007 Name of Electronic Reporter: Aner Berger. Position: General Counsel and Company Secretary. 1

2 January 6, 2008 To: To: Israel Securities Authority Tel Aviv Stock Exchange Ltd. 22 Kanfei Nesharim Street 54 Ahad Haam Street Jerusalem Tel Aviv Dear Sir/Madam Re: Immediate report of convention of an special general meeting Notice is hereby given that on Monday, 11 February 2008, at 11:30 a.m., an Special General Meeting of the shareholders of Israel Chemicals Ltd. (ICL or the Company) will be held at the offices of the Company at 23 Aranha Street, Millennium Tower, Tel Aviv, on the 23 rd floor. 1. On the agenda: Arrangement of directors' compensation, as set forth in the proposed resolution below. 2. Proposed resolution: To approve the directors' compensation as set forth below: 2.1. The directors' compensation that was paid and that will be paid to all directors at ICL, with the exception of the external directors, will be the maximum compensation permitted in accordance with the Companies Regulations (including Compensation and Expenses of an External Director) (Compensation Regulations) according to the ranking of ICL based on its equity As an intermediate regulation, as of 1 January 2008, the compensation for ICL directors will be increased as follows: (a) annual compensation of NIS 78,259; (b) compensation of NIS 3,010 for participation in each board of directors meeting (the percentage from this amount for a meeting via telecommunications, resolution without actual convention, and so on, will be as specified in the Compensation Regulations) Compensation for directors employed by a subsidiary company of The Israel Corporation Ltd., owner of ICL, will be paid to their employers, on their request and provided they do not instruct otherwise. As of the date of the resolution, the directors who are employed by the subsidiary company, as specified above, are Nir Gilad, Avisar Paz, and Noga Yatziv The amounts set forth in sub-clause 2.2 above will be increased to the maximum compensation permitted, including the payment permitted for an expert director, if any, in accordance with ICL's rating, if and when the Companies Regulations (Regulations for Compensation and Expenses of an External Director) (Amendment) is approved, starting from when the amendment comes into effect Legal VAT will be added to the directors' compensation There is no change to the compensation for the external directors. 2

3 Explanation: ICL pays every director uniform compensation in accordance with the Compensation Regulations. The Minister of Justice submitted a proposal to the Constitution, Law and Justice Committee to amend the Compensation Regulations and to establish another level of compensation for external directors in companies with high equity and to allow another level of payment for an expert external director (who according to the draft regulations, is a director with accounting and financial expertise or a director who the board of directors deems to have high skills and deep understanding of the Company's core business, due to his experience and skills). According to the proposal, the maximum annual compensation (in a company on the level of ICL) for an external director will be NIS 110,000 for an expert external director and NIS 82,378 for a regular external director. The maximum compensation for participation in a board of directors meeting (in a company on the level of ICL) will be NIS 4,225 for an external expert director and NIS 3,169 for a regular external director. All the amounts will be linked to the consumer price index as set forth in provision 8 of the Compensation Regulations. At the report date, the index-linked annual compensation for an expert external director is NIS 123,930 and annual compensation for a regular external director is NIS 92,810, linked to the index. An expert external director in a company (on the level of ICL) will receive NIS 4,760 for participation in a board of directors meeting and a regular external director will receive NIS 3,570. It is proposed to determined that an intermediate amount will be paid, as specified above, until this amendment is approved, and if and when the amendment to the Compensation Regulations come into effect, they will be complied with, including payment to any expert director. As of the date of this report, 11 out of 12 ICL directors have accounting and financing expertise and are considered as "expert directors" under the proposed regulation. 3. Approvals The proposed resolution was approved by the audit committee in its meeting on 1 January 2008, and then by the board of directors in its meeting on 1 January and 2 January Main explanations of the audit committee and board of directors: The directors examined and considered the increase in the directors' compensation and approved it on the basis of the following main considerations, explanations and parameters below: 4.1. The board of directors and audit committee are of the opinion that the compensation is appropriate, reasonable, and not unusual, considering the size and value of ICL, the scope and complexity of its businesses, and the tasks and responsibility of the board of directors Another consideration is the size and diversity of ICL's operations, which require investment of a growing amount of time and attention to fulfill the tasks of the board of directors.

4 4.3. The amounts that the General Meeting is requested to approve for directors' compensation are lower than those proposed by the Ministry of Justice. Awarding directors' compensation on a level that is lower than specified in the Compensation Regulations and adapting the compensation to the maximum level when the amendment comes into effect is a balanced decision that incorporates future flexibility in view of possible change of the circumstances The Company's ability to engage highly skilled people with the required expertise to serve as directors in the Company is affected, inter alia, by its willingness to pay appropriate compensation in return for their services. 4.5 ICL greatly appreciates the contribution of the Company's directors to ICL's businesses To the best of the director's knowledge, some large companies have already implemented directors' compensation that is higher than that specified in the Compensation Regulations. None of the directors objected to the above mentioned approval. 5. Notice of convention of a General Meeting, the required majority and the date for determining the shareholders' voting rights 5.1. Notice is hereby given that on Monday, 11 February 2008 at 11:30 a.m. a General Meeting of the shareholders of ICL will be held at the offices of the Company at 23 Aranha Street, Millennium Tower, Tel Aviv. The above mentioned resolution is on the agenda of this meeting Required majority at the General Meeting The majority required to carry all the resolutions on the agenda at a General Meeting (including an adjourned meeting, if it takes place) is a majority of the votes of the shareholders present, in person or by proxy, who are entitled to vote, with the exception of the abstaining voters The right to participate and vote A shareholder is entitled to appoint a proxy to participate in the meeting and vote on their behalf in accordance with the Company's regulations. Proxy appointments will be deposited with the company secretary at the Company's registered office at least 48 hours before the time set for the meeting or the adjourned meeting The date for determining entitlement to participate in and vote at the meeting, as set forth in section 182 of the Companies Law , is Thursday, 24 January 2008 at the end of trading at the stock exchange (the Record Date) In accordance with the Companies Regulations (Proof of Ownership of Shares for the Purpose of General Meeting Voting) (the Regulations), if a shareholder whose share is registered at a member of the Tel Aviv Stock Exchange and that share is included in the Company's shareholders register in the name of a nominee company, wishes to vote at the General Meeting, the shareholder is required to furnish the Company with a Certificate of the Stock Exchange Member with whom the share is registered, certifying its title to the 4

5 share on the Record Date, in accordance with the form in the Addendum to the Regulations Quorum and adjourned meeting A quorum shall be constituted by the presence, in person or by proxy, of at least 2 members who together hold at least 50% of the voting rights. If a quorum is not attained within half an hour after the time set for the meeting, the meeting shall be adjourned until the same day of the following week, at the same time and the same place. If a quorum is not attained at the adjourned meeting within half an hour after the time set for the meeting then two members with voting rights, present in person or by proxy, holding at least one third of the Company's issued share capital, will constitute a quorum Review The shareholders may review the documents related to the proposed resolution that are open for review at the office of the general counsel and company secretary, Adv. Aner Berger, in ICL's registered offices, at the address set forth at the top of this notice, from Sunday to Thursday during regular work hours, after prior coordination (tel ). Aner Berger, Adv. General counsel and company secretary Aranha 23, Millennium Tower, Tel Aviv Phone , Fax: , e mail anerb@icl-group.com 5