EMBLAZE LTD (LSE:BLZ) ("Emblaze" or the "Company") Company Update Herzeliya, Israel, 28 November 2013. Capitalised terms will have the meanings ascribed to them in the Company's announcements of 4 November 2013, 11 November 2013, 13 November 2013 and 27 November, as applicable. Further to the Company's announcement of 27 November 2013 in relation to the submission of the Revised Proposal and previous announcements in this regard Newco entered into an agreement with G. Willi-Food International, Ltd., a public company listed on the NASDAQ Stock Exchange, ("Willi-Food"), according to which Willi-Food will grant Newco a convertible loan in an aggregate principle amount of NIS 65,000,000 (the "Convertible Loan"). The Convertible Loan amount was deposited into the Designated Escrow on 28 November 2013. The main terms and conditions of the Convertible Loan are as follows: 1. The Convertible Loan is a "Bullet Loan" (principle, linkage and interest) and will be repaid on the earlier of (i) 28 November 2014, and (ii) 6 months from Closing (the "Original RepaymentDate"). The Convertible Loan will bear an interest rate of 5% per annum calculated on a compound interest basis and in addition linked to Israeli index from 28 November 2013. Willi-Food will be entitled to demand repayment of the Convertible Loan as of the Original Repayment Date by providing Newco a 60 days prior written notice. To the extent that Willi-Food does not provide notice to Newco to repay the Convertible Loan on the Original Repayment Date, with effect from the 15th day following the Original Repayment Date until the Convertible Loan is repaid, any unpaid amount (principle, linkage and interest accumulated as of the such date) will instead bear interest at a rate of 1% per month instead. 2. In the event where the Revised Proposal is not approved by the IDB creditors Court, or in the event where the Revised Proposal's conditions to Closing are not met, the Convertible Loan will be repaid before the Original Repayment Date together with all accrued linkage and interest. 3. Willi-Food will be entitled to delay the Original Repayment Date to a date no later than 3 years from Closing by providing Newco with a written notice 30 day prior to the Original Repayment Date. 4. Willi-Food has the option to convert the Convertible Loan into IDB shares or IDBD shares held by Newco (as the case may be), in proportion to the Convertible Loan amount and the principle sum invested by Newco under the terms of the Revised Proposal on closing (the number of shares to be transferred to Willi-Food as a consequence being the "ConversionShares"), subject to the fulfillment of the following accumulative pre-conditions: (i) the approval of the antitrust authority in relation to Willi-Food's joining the Consortium; (ii) Willi-Food meeting the requirements of the proposed Israeli business concentration law (a law proposal for the promotion of competition and reduction of business concentration in Israel), in a way that does not impose on IDBD or any other company under its control material limitations or obligations (such as the sale of companies, a change of board members, a change of corporate government rules, etc). 5. In the event that Willi-Food does not meet all or some of the pre-conditions set out in paragraph 4 above, Willi-Food will be entitled to transfer the Convertible Loan to any third party that will be able to meet such pre-conditions, whereupon such third party may convert the Convertible Loan on the date of such transfer and become a party to the shareholders' agreement of Newco. Such a transfer to a third party will be subject to a right of first refusal in favour of Newco in accordance with the terms of the Newco shareholders' agreement. 6. On the date of conversion of the Convertible Loan, and as a condition such conversion, Willi-Food will join as a party to the shareholders' agreement entered into between the shareholders of Newco, and such agreement will be amended to permit Willi-Food to propose the appointment of one member to the boards of IDB and companies under IDB's control, for as long as Willi-Food holds IDB shares which reflect at least 75% of Willi-Food original amount of convertible shares. 7. In the event the Convertible Loan is converted into Conversion Shares, all amounts of interest and linkage will be waived by Willi-Food, and Willi-Food will not be entitled to any payment of any kind as an alternative. 8. In addition, Newco granted Willi-Food a put option in relation to the Conversion Shares , under which Newco will be obliged to buy from Willi-Food the conversion shares, all or part of them, in consideration for the exercise price per share equal to the nominal amount of investment per share paid by Willi-Food for the conversion shares, in addition to annual interest in a rate of 5% calculated on a compound interest base, as of Closing and until the date of exercise of the put option, subject to similar terms as the put options granted to the other Consortium members. The put option is exercisable as of the first day of trade at the lapse of 36 months after Closing, and until the lapse of 72 months after Closing. The put option is subject to adjustments in the event a dividend distribution, benefit shares, share issuance, consolidation of shares/stock split. 9. In order to secure the repayment of the Convertible Loan, Newco will deposit on Closing the Conversion Shares into escrow, and will register a first class charge in favour of Willi-Food's over such shares. Newco will not be entitled to carry out any disposition or transaction in relation to the Conversion Shares prior to repayment of the Convertible Loan. The Company is the guarantor of Newco's obligations to repay the Convertible Loan, and to the payment of the exercise price to Willi-Food following exercise of the put option. Enquiries: Hagit Gal, Emblaze firstname.lastname@example.org The Emblaze Group is traded on the London Stock Exchange (LSE: BLZ) since 1996. www.emblaze.com. END -0- Nov/28/2013 18:00 GMT
EMBLAZE LTD: Company Update
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