PRIMARY MARKET INITIAL PUBLIC OFFERING ON ISE PRIMARY MARKET

PRIMARY MARKET INITIAL PUBLIC OFFERING ON ISE PRIMARY MARKET

OPERATION PRINCIPLES OF INITIAL PUBLIC OFFERING METHODS ON THE PRIMARY MARKET OF THE EXCHANGE The Sale on Stock Exchange Method has been regulated by our Circular-letter dated March 11, 2011 and No. 366. Pursuant to the arrangement, sale on Stock Exchange can be realized using 3 different methods in the framework of the Primary Market rules. I- PRIMARY MARKET OF CORPORATIONS TO BE INITIALLY LISTED ON THE EXCHANGE Any one of the three sale methods below can be used in the Primary Market of Corporations or Shares To Be Initially Listed on the Exchange. Stocks to be offered to the public on the Exchange via the ISE Stock Market Trading System (System) are traded with the market specification codes BE and BY on the primary market. 1- Continuous Auction Method 2- Book Building and Sale with a Fixed Price Method (Fixed Price Method) 3- Book Building and Sale with Variable Price Method (Variable Price Method) 1- Continuous Auction Method Rules applicable to the Continuous Auction Method on the Stock Market are also applicable to the Primary Market of Corporations or Shares To be Initially Listed on the Stock Exchange. This method is called the Continuous Auction Multiple Price Method" because buy and sell orders transmitted to the System throughout the session can be matched at different price levels and therefore different trading prices can occur in the same session. In this method, trading shall take place on a continuous basis, with each incoming order being checked and matched on a price and time priority basis. The period of initial public offerings where the sale on Stock Exchange via Continuous Auction Method is used has been limited to 2 business days. However, if a longer sales is planned, the base price announced on the first day of public offering will be used as the opening price on each day the public offering continues. Initial public offerings of the corporations or shares to be initially listed on the Exchange on the Primary Market via Continuous Auction shall be completed in 2 days. However, it is possible that the brokerage house that undertakes the public offering may carry out sales for a period longer than 2 days. Secondary market trading shall not be started so long as the initial public offering continues. The base price to be applied in the first session during which the shares that are sold via initial public offering on the primary market of the Exchange via Continuous Auction are to be traded on the secondary market is determined by rounding the weighted average price of all 2

trades executed during the public offering on the primary market to the nearest price tick, and this price is taken as a base in calculating the lower and upper price limits to be used in the first trading session on the secondary market. 2- Fixed Price Method All orders are transmitted to the System at such price level which is determined and announced by the company whose stocks are offered to public. Trades are executed at that single price. Distribution is held automatically at such time determined by the Exchange upon expiry of the primary market. More than one buy order can be transmitted with the same account number. In that case, distribution is made starting from the first order with time priority among the orders having the same account number, and the others are not subject to distribution unless that order is exhausted. 3- Variable Price Method All orders are transmitted to the System at such price interval which is determined and announced by the company whose stocks are offered to public. Orders received with a price which is outside such interval are not admitted to the System. The price of the order can be changed within the specified interval (including minimum and maximum levels). Trades are executed over a single price to be determined in that price interval. The price level at which the entire offering is satisfied according to price and time priority is set as the public offering price. In this method, more than one buy orders can be transmitted with the same account number as with the Fixed Price Method. In that case, distribution is made starting from the first order with price and time priority among the orders having the same account number, and the others are not subject to distribution unless that order is exhausted. In all three methods, no special order can be entered to the System in the primary market of corporations to be initially listed on the Exchange. II- OPERATION OF FIXED PRICE AND VARIABLE PRICE METHODS Points Common to Fixed and Variable Price Methods: These new methods which are developed for the primary market of the exchange are comprised of two stages: - Book Building Stage: At this stage, orders are collected via keyboard and ExAPI channel. Book building period is one business day minimum and three business days maximum. The period is determined by the Executive Council of the Exchange upon the request of the company. Provided that the Capital Markets Board (CMB) or the Exchange has not decided otherwise and an announcement has been made by the company or the brokerage house that mediates to the public offering prior to the sale, distribution can be made without waiting the expiry of the book building period (e.g. at the end of the first day primary market session or the second day primary market session). 3

- Screens containing order information of the stock are closed during the Book Building Stage as in the opening and single price session applications. No information is released regarding orders entered until the distribution of that stock is made. - Distribution Stage: Orders collected are distributed to buyers as detailed below. Points Common to Book Building Stage: - Session Hours: Buy orders are entered inside the primary market session hours. - Order Types: Only orders in the form of limit price normal orders are entered (limit price sell order, short selling order, immediate or cancel order, special limit price order, special limit value order, odd lot orders and special orders cannot be entered). - Order Validity Period: Orders are valid until the end of the book building period. Whilst the period (validity date) of the order cannot be determined by the brokerage houses, the expiry date of the order is set as the expiry date of the book building period automatically by the System during the entry of the order, and orders are kept in the System until the end of that period. - Order Cancellation: Orders can be cancelled any time within the primary market session hours. - Modification of Orders: Amounts, account numbers, and Agency Fund Codes of the orders cannot be changed, and validity periods cannot be prolonged or shortened. Orders cannot be split. - Account Number Correction: Account Number and Agency Fund Code corrections at T+1 are not permitted. - Maximum Lot Quantity: Determined by the Stock Market Management. Fixed Price Example: Quantity to be sold Total asks received Price = 23 lots = 54 lots = 5.00 TL An institution can transmit more than one order with the same account number (belonging to the same person). When making the distribution to the submitted buy orders that are ranked by time priority, orders from the same member with the same account number are considered collectively. First, distribution is made starting from the first order with time priority among the orders having the same account number, and the other order and/or orders with the same account is and/or are not subject to distribution unless that order is fully filled. If the first order is fully filled, the other order which is ranked after it according to time priority becomes eligible for distribution, and the distribution is proceeded with in that way. Important Note: Account number identicalness is evaluated on a brokerage house (member) basis. Account numbers which are transmitted from different brokerage houses and are the same with each other are not treated collectively during the distribution phase 4

In the following example, we assume that all orders are entered by a single brokerage house and there are 2 orders entered in the name of the person with account number "A", so the first of these 2 orders which was entered first in the system according to time priority and consisted of 3 lots undergoes distribution first, and after it is executed, the other order consisting of 6 lots takes the turn. Executed Trades: Order Rank Number (1) (2) (3) (4) (5) Customer Account Number A B C A D Lot Quantity Asked 3 14 23 6 8 Quantity Remaining After First Round 2 13 22 6 7 Quantity Remaining After Second Round 1 12 21 6 6 Quantity Remaining After Third Round 0 11 20 6 5 Quantity Remaining After Fourth Round 0 10 19 5 4 Quantity Remaining After Fifth Round 0 9 18 4 3 Quantity Remaining After Sixth Round 0 8 17 3 3 TRADING VOLUME 3 6 6 3 5 Customer Account No (Buyer) Trading Price Trading Volume A 5.00 3 B 5.00 6 C 5.00 6 A 5.00 3 D 5.00 5 Total 23 Variable Price Example: Quantity to be sold Price interval Total bids received : 5,000 lots : 4.00 4.80 TL : 16,000 lots (All buy orders are entered by the same institution) Information about buy orders ranked according to price and time priority: 5

ORDER NO CUSTOMER ACCOUNT NO PRICE (BUY) QUANTIT Y (BUY) CUMULATIVE QUANTITY (BUY) 3 A 4.80 500 500 2 B 4.70 500 1,000 1 A 4.60 1,000 2,000 8 C 4.50 1,000 3,000 4 D 4.40 1,000 4,000 6 E 4.30 2,000 6,000 5 F 4.20 5,000 11,000 7 G 4.10 5,000 16,000 - The price level at which the entire offering is satisfied in orders ranked according to price and time priority is set as the sales price. Even if the amount asked at that price level is higher than the amount offered, all buy orders at and above that price level are included in the distribution. - In the example, the sale price is 4.30 TL. - After the price is determined, orders with prices lower than 4,30 TL are retained in the System, but are ignored during the distribution. Distribution Table ORDE R NO CUSTOM ER ACCOUN T NO PRICE (BUY) QUANTI TY (BUY) TRADE (ROUN D 1) TRADE (ROUN D 2) TRADE (ROUN D 3) REMAI NDER 3 A 4.80 500 500 0 0 0 2 B 4.70 500 500 0 0 0 1 A 4.60 1,000 0 500 250 250 8 C 4.50 1,000 500 500 0 0 4 D 4.40 1,000 500 500 0 0 6 E 4.30 2,000 500 500 250 750 5 F 4.20 5,000 0 0 0 5,000 7 G 4.10 5,000 0 0 0 5,000 Total 16,000 2,500 2,000 500 11,000 6

Executed Orders: Buyer Order No Buyer Account No Trading Price Trading Volume 3 A 4.30 500 2 B 4.30 500 8 C 4.30 1,000 4 D 4.30 1,000 1 A 4.30 750 6 E 4.30 1,250 Total 5,000-500 lots from order number 3 and 750 lots from order number 1 are distributed to account A - 500 lots are distributed to account B, - 1,000 lots are distributed to account C, - 1,000 lots are distributed to account D, - 1,250 lots are distributed to account E. III- PRIMARY MARKET OF CORPORATIONS ALREADY LISTED ON THE EXCHANGE The stocks representing pre-emptive rights of the listed companies, which are not exercised by the existing shareholders and stocks offered to public by restricting the pre-emptive rights of the existing shareholders are to be traded via continuous auction. The Exchange Management may choose Fixed Price Method or Variable Price Method instead of Continuous Auction Method based on different markets, groups (A, B, C) or stocks. Base price and price margins do not apply to the public offering of shares representing pre-emptive rights of the listed companies, which are not exercised by the existing shareholders.. Only the designated member can place a sell order on the primary market. Shares bought from the Primary Market cannot be resold on the Primary Market. IV- SETTLEMENT Settlement takes place in 2 business days (T+2) that succeeds the day on which the distribution took place and all the trades are done (T). 7

V- SESSION HOURS PRIMARY MARKET TYPE SALES METHOD SESSION HOURS Initial Public Offering of Stocks of Companies Not Listed on the Exchange Public Offering of the stocks representing pre-emptive rights of the listed companies, which are not exercised by the existing shareholders on the ISE Primary Market Fixed Price Method Variable Price Method Continuous Auction Method Continuous Auction Method 1 10:30 12:00 For Fixed Price Method and Variable Price Method: Book Building Phase : 10:30 12:00 Distribution Phase : 12:15 12:30 2 1 The Exchange Management may choose Fixed Price Method or Variable Price Method instead of Continuous Auction Method based on different markets, groups (A, B, C) or stocks. 2 The distribution stage that starts after 12:15 is ended according to the effect of factors such as the number of orders received, order size, number of accounts, quantity of shares offered to public. 8

SUBJECT CONTINUOUS AUCTION FPM (Fixed Price Method) VPM (Variable Price Method) Book Building Hours 10:30-12:00 10:30-12:00 10:30-12:00 Trading/Distribution Hours 10:30-12:00 12:15 12:15 Price of Orders Offered Price Determination and Distribution Principles Variable (Below and above 10% based on public offering price) Buy and sell orders transmitted to the System can be matched at different price levels throughout the session. In this method, trading shall take place on a continuous basis, with each incoming order being checked and matched on a price and time priority basis. Fixed Orders are ranked according to time priority. One lot is distributed each time until the amount to be sold is exhausted, taking time priority into account. Trades are finalized only after the distribution is completed (after what portion of each order has been filled is ascertained). Orders entered with the same account number from each institution are treated collectively, and each account number can only take one lot in each distribution round starting from the first order entered. Variable (Within the price interval determined for public offering) Orders are ranked according to price and time priority. The price level at which the entire offering is completed is set as the sale price. Distribution is made to all buy orders which are received at and above that price level. Trades are finalized only after the distribution is completed (after what portion of each order has been filled is ascertained). Orders entered with the same account number from each institution are evaluated collectively, and each account number (irrespective of the number of orders entered) can only take one lot in each distribution round starting from the first order entered. Trading Price Multiple Price Single Price Single Price Price/Time Priority Price and Time Priority Time Priority Price and Time Priority After the end of each Primary Market Distribution Date and Every day, continuous auction. session, it can be started until the end of that Time session. Price Quantity Information in Order Format After the end of each Primary Market session, it can be started until the end of that session. Current Application is Valid Price + quantity must be stated Price + quantity must be stated Combining Orders with Same Account Number Combining is not permitted Combining is permitted Combining is permitted Settlement (T = Trading T+2 T+2 T+2 9

/ Distribution Day) Inquiries Open At Book Building Phase: Closed At Book Building Phase: Closed After the Distribution: Open After the Distribution: Open Data Broadcast Open At Book Building Phase: Closed At Book Building Phase: Closed After the Distribution: Open After the Distribution: Open Data Broadcast (Executed Orders) Open Broadcast Starts After the Distribution Broadcast Starts After the Distribution Maximum Lot Limit Yes Yes Yes Order Types Normal Order + Special Order Only Limit Price Orders for Buyers. Sell Only Limit Price Orders for Buyers. for Buyer and Seller order is generated by the System. Sell order is generated by the System. Maximum Order Value Yes Yes Yes Customer/Portfolio/Fund Current application is valid Current application is valid Current application is valid Order Validity Period (Normal Orders + Good Till Date Orders) Maximum 1 day Valid until the end of the last book building session. Valid until the end of the last book building session. Order Cancellation Allowed Allowed at Book Building Phase Allowed at Book Building Phase Amounts of the orders cannot be changed, and Amounts of the orders cannot be changed, validity periods cannot be prolonged or Modification of Orders Allowed and validity periods cannot be prolonged or shortened. Order prices can be changed within shortened. Order prices cannot be changed. the specified price interval. Order Split Allowed No No Account Number Correction Yes No No There are lower and upper price limits set by Price Margins Yes (10%) No - Fixed Price the issuer Fixed price is determined at a price tick The price tick that corresponds to the price of the Price Ticks Current application is valid corresponding to the respective price level order transmitted to the system is valid Special Order Yes No No Erroneous order / transaction correction (at T+1) Yes No No 10