BSD Crown Ltd. (LSE: BSD)

(the “Company”)

Notice of an Extraordinary General Meeting

 Ramat Gan, Israel, 23 February 2017

The Company has today issued a Notice of Extraordinary General Meeting ("Meeting").

The Meeting will be held at 9.00am (BST) on 29 March 2017 at the Hilton London Tower Bridge, 5 More London Place, Tooley Street, London SE1 2BY, United Kingdom.

The Meeting is convened for the purpose of seeking shareholders’ authority to approve the amendment of the Company's articles of association, the appointment of certain external statutory directors, the appointment and remuneration of auditors, and the amendment of the Company's officers' remuneration policy.

In addition Yossi Willi Management and Investment Ltd. (the “Requisitionist”) a Shareholder, has requisitioned an extraordinary general meeting of the Company and is proposing resolutions to seek shareholders’ authority to approve the appointment of several individuals as directors of the Company and the removal from office of all of the existing directors of the Company (apart from the Company’s external director (Mrs. Iris Even-Tov) who has a statutory role under Israeli law).

Resolutions recommended for adoption by the Company

1. The Board is proposing to amend the Company's articles of association in order to ensure that the Company’s management is represented at all general meetings, including via tele-conference.
2. The Board is proposing to elect at least two of Mr. Gal Chet, Mr. Yair Shilhav and Mr. Shlomo Wertheim (the "External Director Nominees") as external directors of the Company. The Board believes that the appointment of at least two of the External Director Nominees as external directors of the Company complies with the provisions and requirements under the Israeli Companies Law and that their skills and capabilities would contribute to the Company’s on-going business. The Board has also determined that the External Director Nominees satisfy the requirements under the UK Corporate Governance Code to serve on the Board as independent directors and that their appointment will increase the level of independence of the Board.

As required by the Israeli Companies Law, it is proposed that at least two of the External Director Nominees be elected to serve the office as external directors for an initial fixed term of three years commencing on the date their election is approved by Shareholders. If the election is approved by Shareholders, at least two of Messrs. Chet, Shilhav and Wertheim will be appointed by the Board to serve as members of each of the audit committee, compensation committee and remuneration committee.

1. As required by the Israeli Companies Law, at least once in every three years, it is proposed to adopt the the Company’s updated remuneration policy. A copy of the full English translation of the Remuneration Policy is available in the notice in respect of the Company's general meeting which has been sent to Company Shareholders today.
2. In order to allow the Company to make further progress, finalise and publish its financial statements for the years ending 31 December 2015 and 31 December 2016, it is recommended to approve the appointment of PWC Israel (Kesselman & Kesselman CPAs) as the Company’s external auditors until the next annual general meeting of the Company and to authorise the Board, with the approval of the audit committee of the Board, to determine the remuneration of the auditors

Resolutions proposed by the Requisionist

The following resolutions are proposed by the Requisionist who, in the opinion of the Board, is attempting to take over the control and management of the Company:

1. As a result of the Requisitionist’s request to replace each of them, effectively requiring the re-election of Mr. Gregory Gurtovoy, Mr. Eli Arad,  Mr. Nir Netzer and Mr. Arik Safran as directors of the Company. The directors will hold office until the next annual general meeting of the Company.
2. To elect Mr. Joseph Williger, Mr. Shmuel Messenberg, Mr. Avi Zigelman and Mrs. Keren Marcus as directors until the conclusion of the next annual general meeting.

Further information regarding the background and experience of certain of the directors proposed by the Requisitionist is available in the notice in respect of the Company's general meeting  which has been sent to Company Shareholders today.

The Board also considers that the election of Mr. Joseph Williger, Mr. Shmuel Messenberg, Mr. Avi Zigelman and Mrs. Keren Marcus not to be in the best interests of the Company and its Shareholders as a whole. The Board has taken active steps to confirm the suitability of the Requisitionist’s proposed directors, seeking information about them (in respect of which no details have been provided) and requesting a meeting with such proposed directors (which request was declined by the Requisitionist through the Requisitionist’s legal counsel). The Board does not know the proposed directors and does not have up to date information about them. As such, the Board cannot, without the additional information it requested but was denied, make an assessment as to the suitability of such proposed directors to act in the best interest of the Company and its Shareholders as a whole. As such, the Board considers the appointment of all of the Requisitionist’s proposed directors not to be in the best interests of the Company and its Shareholders as a whole and recommends that Shareholders vote against the relevant resolutions at the Meeting.

Further details of all of the abovementioned matters are contained in the notice in respect of the Company's general meeting  which has been sent to the Company’s Shareholders today.

In addition to the resolutions proposed by the Requisitionist, which the Board considers to be an attempt by the Requisitionist to take over the control and management of the Company, it should be noted that although no decision has been taken by the Board to issue new shares in order to attempt to ensure sufficient shares of the Company held in “public hands” for the purposes of Chapter 14 of the listing rules made under section 74 of the Financial Services and Markets Act 2000 (as amended) (the “Listing Rules”), on 16 February 2017, the Requisitionist, by its controlling shareholder Mr. Joseph Williger, filed a request for a temporary injunction against the Company preventing the Company from taking any action which may change the Company’s capital, and which might include, by way of example, a non pre-emptive issue of shares in order to try and address the “public hands” position of the Company. The court has granted Mr. Joseph Williger a temporary injunction prohibiting the Company from doing the same pending a hearing. The Board is considering its options in relation to the request, which it considers to be an unjustified hindrance on the Board’s ability to consider all available options to it for the benefit of the Company and its Shareholders as a whole, among other things, in order to secure the lifting of the suspension in trading of its shares on the London Stock Exchange as soon as practicably possible.

The Company takes this opportunity of reminding shareholders that under the Listing Rules, in the event that the Financial Conduct Authority has the power to cancel the Company’s listing where the percentage of shares in public hands falls below 25 per cent.. If the listing is cancelled there will no longer be an exchange on which the Company’s shares can be readily traded.

As announced by the Company on 8 February, 2017, following the acquisition (directly and indirectly) by Mr. Yossi Williger of 7.94% of the Company’s issued and outstanding share capital pursuant to a tender offer, and in light of the clarification provided by Mr. Zwi Williger as to the fact that he holds (directly and/or indirectly) 9.996% of the Company’s issued and outstanding share capital, the Company believes that the number of shares of the Company currently held in “public hands” for the purposes of Chapter 14 of the Listing Rules has fallen to approximately 12.6%, which is significantly below the 25% threshold required (subject to certain exceptions) under Chapter 14 of the Listing Rules.

Copies of the Notice will be submitted to the National Storage Mechanism and will shortly be made available on the Company's website at www.bsd-c.com and from the National Storage Mechanism at www.morningstar.co.uk/uk/NSM.

Enquiries:

Gregory Gurtovoy, chairman of the board: office@bsd-c.com