YAVNE, Israel, November 29, 2013 /PRNewswire/ --
G. Willi-Food International Ltd. (NASDAQ: WILC) (the
"Company" or "Willi-Food"), is pleased to announce
that it has reached an agreement with C.D-B.A Holdings (Designated)
(2013) Ltd. ("C.D-B.A") according to which the Company would
provide a convertible loan in the aggregate amount of NIS 65 million (approximately USD 18.3 million) (the "Loan"),
convertible at the election of the Company into shares of IDB
Holding Corporation ("IDBH") or IDB Development Company Ltd.
("IDBD"), each traded on the Tel Aviv Stock Exchange, to be
held by C.D-B.A.
IDBH is one of the largest holding companies in Israel and controls, both directly and
indirectly through its holding companies, in companies involved in
a wide range of business activities in Israel and abroad, such communications,
retail, real estate, finance, insurance and aviation. IDBH
conducts many of its activities through its holdings in IDBD, its
wholly owned subsidiary. IDBH and IDBD are currently in debt
reorganization proceedings in Israeli court.
The number of shares issuable upon conversion of the Loan will
be determined based on the ratio between the principal amount of
the Loan and the amount of equity contributed by C.D-B.A in the
context of debt arrangement of IDBH. To the best knowledge of
the Company, C.D-B.A is owned 70% indirectly by Emblaze Ltd., a
public company listed on the London Stock Exchange
("Emblaze"), and 30% by Mr. Nochi Dankner and his
family members ("Dankner").
C.D-B.A is part of a group of investors that also includes Netz
Group Ltd., Alon Car Garage (1992) Ltd., Mr. Daniel Hosidman and the Nakash family
(collectively, the
"Investor Group") that financially
supports the most recent reorganization plan between IDBH and its
creditors submitted by IDBH to Israel court under Section 350 of the Israel
Companies Law (the "Plan"). The Loan will be
convertible at the election of the Company into shares of the
company (IDBH or IDBD) into which the Investor Group determines to
invest pursuant to the Plan.
The Loan is intended to be used by C.D-B.A to consummate the
Plan. The amount of the Loan will be included with the other funds
deposited in trust to secure the investment of the Investor Group
in IDBH, pursuant to the Plan.
Unless otherwise determined by the Company, the Loan will be due
and payable one year from the date of deposit or six months from
the date of closing set according to the Plan (the "Original
Repayment Date"). The Loan will bear interest at the rate of 5%
annually compounded annually from the date of deposit until the
date of relevant repayment and will be linked to the CPI as
published on November 15, 2013. In
the event that the Plan is not approved by the court, or if other
preconditions to closing are not satisfied, the Loan will be repaid
and returned to the Company before the original repayment date
including linkage differential and accumulated interest (the
"Early Prepayment Date").
The Company may elect to extend the Original Repayment Date for
an additional three (3) years from closing by providing a prior
written notice to C.D-B.A at least 30 days prior to the Original
Repayment Date. At any time following the Original Repayment Date,
the Company may demand immediate repayment by providing a written
notice to C.D-B.A 60 days in advance (the "Final Repayment
Date"). The Loan will bear late interest of 1% per month
if the Loan is not repaid by the Original Repayment Date, Early
Repayment Date or Final Repayment Date, as the case may be.
From closing and at the Company's election, the Loan will be
convertible into shares of IDBH or IDBD held by C.D-B.A subject to
satisfaction of the following conditions (in addition to conditions
precedent set forth in the Plan): (i) approval of the Israel Trust
Authority to the joining by the Company to the Investor Group and
to the shareholders agreement (described below) and (ii)
satisfaction by the Company of the requirements of the Law of
Concentration, including in a manner that doesn't impose material
limitations on IDBH and/or companies under its control or require
them to take material actions. To the extent the Company does
not satisfy these conditions, it will be permitted to transfer the
Loan to a third party that satisfy the conditions, who would
convert the Loan on the date of transfer and join the Investor
Group. The transfer to a third party will be subject to a
right of first refusal to C.D-B.A pursuant to the shareholders
agreement. In the case of conversion of the Loan, the Loan
will not bear interest or linkage, and the Company will not be
entitled to any payment on account of the Loan.
According to the agreement, on the date of conversion and a
condition of conversion, the Company will join as a party to the
shareholders agreement of the Investors Group relating to their
holdings in IDBH or IDBD, as the case may be. The shareholders
agreement will address, among others, (i) coordination of voting at
shareholder meetings of IDBH or IDBD, as the case may be (with
limited exceptions), (ii) appointment of directors of IDBH or IDBD,
as the case may be, such that C.D-B.A would be able to appoint a
majority of the directors and other shareholders appoint the
remaining directors; upon conversion of the Loan to shares, the
Company will have the right to recommend the appointment of one
director in IDBH and the companies under its control so long as the
Company continues to hold at least 75% of the shares it acquires
upon conversion of the Loan, (iii) amendment to articles of
association of IDBH and IDBD requiring 80% director vote for
approving the expense line item of the budget and any material
change thereto, (iv) amendment to the articles of association of
IDBH and IDBD requiring 66% director vote to approve related party
transactions under the Israel Companies Law, (v) appointment of CEO
who will be citizen and resident of Israel not related to a member of the Investor
Group, (vi) prohibition on the transfer of shares for three years
from closing (other than permitted transferees), (vii) permission
to encumber shares to recognized financial institution, (viii)
transfer of shares post three year restriction period (and/or other
securities of IDBH or IDBD, as the case may be) subject to first
refusal right of C.D-B.A, (ix) shareholders other than C.D-B.A
granted a tag along right in the event of a sale by C.D-B.A of
securities in IDBH or IDBD, as the case may be, and (x) permission
granted to C.D-B.A to add third parties who join the investment in
IDBH or IDBD, as the case may be, so long as the director
appointment and put rights of the other investors are not adversely
affected.
The agreement further provides that at time of conversion of the
Loan, the Company will have a put option to sell to C.D-B.A all or
part of the shares acquired upon conversion of the Loan in
consideration for a per share price equal to the original
investment amount of the Company per share plus annual interest of
5% per annum compounded annually from closing until conversion of
the Loan. The put may be exercised beginning 36 months following
the closing until 72 months following the closing. The put
option is not transferrable to a third party purchaser of the
shares (other than a permitted transferee) and is subject to
adjustment for dividends, bonus shares, rights offereings, share
splits and share combination. Non-payment of the
consideration by C.D-B.A will bear interest at 0.75% per month, and
C.D-B.A in such case will immediately cease the service of any
directors on account of Mr. Nochi Dankner, Yitzhak Dankner and Emblaze such that the number
of directors on account of the Company and other shareholders will
equal the number of directors on account of C.D-B.A and its related
parties.
The agreement provides that in order to secure the repayment of
the Loan, at closing C.D-B.A will deposit in trust the shares into
which the Loan is covertible and will grant a first priority
security interest in favor of the Company. In addition,
Emblaze guaranteees the full payment of all C.D-B.A obligations to
repay the Loan and the payment of amounts on account of the
put.
Mr. Zwi Williger, the Company's
Chairman of the Board of Directors, stated "We are very excited to
become a stakeholder in one of Israel's most diverse companies. IDBH's
current status has presented us with an opportunity that has the
potential to become a profitable long-term investment for our
Company. We have elected to act cautiously, however, by
granting a loan on terms we believe to be favorable, while at the
same time obtaining a three year option to determine whether we
wish to become a shareholder in the IDB group. Any shareholder with
questions regarding the transaction may contact me at
972-52-357-4066."
About G. Willi-Food International Ltd.
G. Willi-Food International Ltd. (http://www.willi-food.com) is
an Israeli-based company specializing in high-quality,
great-tasting kosher food products. Willi-Food is engaged directly
and through its subsidiaries in the design, import, marketing and
distribution of over 600 food products worldwide. As one of
Israel's leading food importers,
Willi-Food markets and sells its food products to over 1,500
customers in Israel and around the
world including large retail and private supermarket chains,
wholesalers and institutional consumers. The company's operating
divisions include Willi-Food in Israel and Gold Frost, a wholly owned
subsidiary who designs, develops and distributes branded kosher,
dairy-food products.
Forward Looking Statement
This press release contains
forward-looking statements within the meaning of safe harbor
provisions of the Private Securities Litigation Reform Act of 1995
relating to future events or our future performance, such as
statements regarding trends, demand for our products and expected
sales, operating results, and earnings. Forward-looking statements
involve known and unknown risks, uncertainties and other factors
that may cause our actual results, levels of activity, performance
or achievements to be materially different from any future results,
levels of activity, performance or achievements expressed or
implied in those forward-looking statements. These risks and other
factors include but are not limited to: monetary risks including
changes in marketable securities or changes in currency exchange
rates- especially the NIS/U.S. Dollar exchange rate, payment
default by any of our major clients, the loss of one of more of our
key personnel, changes in laws and regulations, including those
relating to the food distribution industry, and inability to meet
and maintain regulatory qualifications and approvals for our
products, termination of arrangements with our suppliers, in
particular Arla Foods, loss of one or more of our principal
clients, increase or decrease in global purchase prices of food
products, increasing levels of competition in Israel and other markets in which we do
business, changes in economic conditions in Israel, including in particular economic
conditions in the Company's core markets, our inability to
accurately predict consumption of our products and changes in
consumer preferences, our inability to protect our intellectual
property rights, our inability to successfully integrate our recent
acquisitions, insurance coverage not sufficient enough to cover
losses of product liability claims and risks associated with
product liability claims. We cannot guarantee future results,
levels of activity, performance or achievements. The matters
discussed in this press release also involve risks and
uncertainties summarized under the heading "Risk Factors" in the
Company's Annual Report on Form 20-F for the year ended
December 31, 2012, filed with the
Securities and Exchange Commission on April
30, 2013. These factors are updated from time to time
through the filing of reports and registration statements with the
Securities and Exchange Commission. We do not assume any obligation
to update the forward-looking information contained in this press
release.
This information is intended to be
reviewed in conjunction with the Company's filings with the
Securities and Exchange Commission.
Company Contact:
G. Willi Food International Ltd.
Raviv Segal, CFO
(+972)8-932-1000
raviv@willi-food.co.il
SOURCE G Willi Food International