Index Rules and Methodology S-Network Europe Equity 500 Index - PDF document

Index Rules and Methodology S-Network Europe Equity 500 Index (Ticker: SNE500) S-Network Europe Equity 1000 Index (Ticker: SNE1000) S-Network Pacific Equity 500 Index (Ticker: SNP500) S-Network Pacific Equity 1000 Index (Ticker: SNP1000) S-Network Developed International Equity 1000 Index (Ticker: SND1000) S-Network Developed International Equity 2000 Index (Ticker: SND2000) March 2019

TABLE OF CONTENTS 1. General Description of the S-Network Developed International Benchmark Indexes …………………………… 3 2. The Index Committee ………………………………………………………………………………………………...…. 3 3. Eligibility Criteria & Weighting………………...………………………………………………………………………. ..3 4. Index Values at Inception …………………………………………………………………………… . ………………… 4 5. Index Changes ………………………………………………………… .. ……………………………………………… .4 6. Quarterly Rebalancings ……………… .. ……………….…...…………………………..……………………………… 5 7. Roles of the Parties in the Semi-Annual Reconstitutions ………………………….…… . ………………………... ..5 8. Roles of the Parties in the Quarterly Rebalancings …………………………………… .. …………………………. ..5 9. Ongoing Maintenance and Handling of Corporate Actions …………………………………… .. ………………….. 6 10. Calculation and Dissemination of Index Values …………………………………………………………………... ...7 11. Calculation and Adjustments ………………………………………………………………………………………... ..8 12. Data Correction Policy ……………………………….……………………………………………… . ……………… 11 13. Review Schedule ……………………………………………………………………………………………………... 11 2

1. General Description of the S-Network Developed International Indexes The S- Network Developed International Benchmark Indexes (the “Benchmarks”) are a series of benchmark indexes designed to provide accurate coverage of publicly listed US stocks that represent over 85% of the market capitalization of developed markets outside the United States. All Benchmarks are weighted based on float market capitalization and are reconstituted on the third Friday of December and rebalanced on the third Fridays of March and September. The Benchmarks include the following indexes:  S-Network Pacific 500 (SNP500): The 500 largest Pacific Basin stocks, including Israel.  S-Network Europe 500 (SNE500): The 500 largest European stocks.  S-Network Developed International 1000 (SND1000): The combined SNP500 and SNE500 Indexes.  S-Network Pacific 1000 (SNP1000): The 1000 largest Pacific Basin stocks, including Israel.  S-Network Europe 1000 (SNE1000): The 1000 largest European stocks.  S-Network Developed International 2000 (SND2000): The combined SNP1000 and SNE1000 Indexes. Eligibility for inclusion in the benchmarks is determined based on the company’s full market capitalization. Certain pass-through securities, including REITS, Mortgage REITS, Master Limited Partnerships, Closed-End Funds and Business Development Companies are excluded from the Benchmarks. 2. The Index Committee The S- Network Benchmark Index Committee (“The Committee”) will be composed of not less than three members. The Committee Chairman will have extensive experience with and expertise in International equity markets. The other members will have experience in financial markets, indexes and/or financial products. The Committee will be responsible for overseeing the activities of the calculation agent and approving all changes to the index related to its semi-annual reconstitutions and quarterly rebalancings. The Committee meets semi-annually, either in person or via teleconference, to discuss index issues and organize the semi-annual reconstitution and semi-annual rebalancing. The composition of the Committee may from time to time be changed to reflect changes in market conditions. All members of the index committee and their advisors shall comply with the S-Network Global Indexes code of conduct and ethics with respect to the disclosure and use of material non-public information. 3. Eligibility Criteria and Weighting The starting universe for the SNP500 is the 750 largest market capitalization stocks domiciled in the following countries: Australia Taiwan Canada Israel Hong Kong Singapore Japan Macao 3

Korea New Zealand The starting universe for the SNE500 is the 750 largest market capitalization stocks domiciled in the following countries: Austria Greece Portugal Belgium Ireland Spain Denmark Italy Sweden Finland Luxembourg Switzerland France Netherlands United Kingdom Germany Norway Monaco Certain stocks domiciled in eligible countries may not be eligible if their “country of risk” is a non -eligible country. Certain stocks domiciled in non-eligible co untries may be eligible if their “country of risk” is an eligible country. “Country of risk” is defined as the country in which the company’s primary business activities are located. Eligibility for inclusion in the starting universe is determined based on the company’s full market capitalization. Certain pass-through securities, including REITS, Mortgage REITS, Master Limited Partnerships, Closed-End Funds and Business Development Companies, are excluded from the Benchmarks. Stocks must maintain an R-Score greater than 1 over the 90 days preceding the last business day of November (“the Snapshot Date”) to be included in a Benchmark. The starting universe is updated semi-annually based on data as of the last business day of November (“the Snapshot Date”). Stocks are selected for inclusion in the Benchmarks based on their full market capitalization rank in the starting universe. Stocks with free float of less than 20% are excluded from the index. Buffers of 10% are applied to the eligibility criteria at each reconstitution for current constituents of the benchmark. Accordingly, stocks must fall below the following thresholds to be dropped from the Benchmarks:  S-Network Developed International Equity 1000 (SND1000): A constituent stock must fall below the rank of 1100 to be deleted.  S-Network Europe Equity 1000 (SNE1000): A constituent stock must fall below the rank of 1100 to be deleted.  S-Network Pacific Equity 1000 (SNP1000): A constituent stock must fall below the rank of 1100 to be deleted.  S-Network Europe Equity 500 (SNE500): A constituent stock must fall below the rank of 550 to be deleted.  S-Network Pacific Equity 500 (SNP500): A constituent stock must fall below the rank of 550 to be deleted. 4

All stocks selected for inclusion in the Benchmarks are weighted based on their float market capitalization. Share weights will be based on prices as of the close of trading on the day before the second Friday of the rebalancing month (“The Record Date”). 4. Sector Weightings The S-Network Developed International Equity 1000 Index (SND1000) is used as the universe for the Developed International Equity Sector Benchmarks. The Sector Benchmarks track stocks in 10 GICS sectors (all besides Real Estate): 1. Information Technology 2. Consumer Discretionary 3. Financials 4. Health Care 5. Industrials 6. Telecommunication Services 7. Consumer Staples 8. Energy 9. Materials 10. Utilities Sector weights within the SND1000 are applied as part of the index rebalancings that occur on the third Friday of each June and December. Certain adjustments may be made to the sector weightings to eliminate data anomalies and to address investment issues related to equity markets. Sector Benchmark constituents shall be subject to limitation on their float-adjusted capitalization weighting as follows: No stock’s weight shall exceed 20%. a) b) The aggregate weight of stocks exceeding 5% shall not exceed 45%. The following procedure shall be used to ensure that no Composite constituent weighting exceeds a pre-determined maximum weight on the rebalancing date: Step 1: Sort the Composite constituents by float market capitalization in descending order. Starting with the second largest company in the index, calculate a float market capitalization ratio for each company to the next largest company in the index. Step 2: Adjust this ratio by the following formula:    1 OriginalRa tio     New Ratio 1   Factor where: Original Ratio = the float market capitalization ratio of each company to the next largest company calculated in Step 1. Factor = a divisor, that starts with 1, that increases the ratio calculated in Step1 Step 3: Calculate new float market capitalization using the New Ratio for each company. Step 4: Calculate the new weights for each company based on the new float market capitalization and check to see if the weight limits described in V(ii) are satisfied. 5