LONG-TERM LOANS FROM STOCKHOLDERS

12 Months Ended

Dec. 31, 2015

NOTE 8

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LONG-TERM LOANS FROM STOCKHOLDERS

During the years 2003-2004, Integrity Israel received loans from stockholders (three separate lenders). The loans are indexed to the Israeli Consumer Price Index from their origination date and bear no interest.

The Group will be required to pay the loans, in quarterly installments, commencing on the first quarter following the first fiscal year in which the Group reports net profit in its annual report. At such time, the Group will be required to make quarterly payments equal to 10% of its total sales for each quarter until the loans have been repaid in full. Notwithstanding the repayment mechanism, the Group will not be required to repay the loans during any period in which such payment would cause a deficit in the Group's working capital. See Note 9D for a description of the repayment of the stockholder loan previously owing to Y.H. Dimri Holdings (2001) Ltd. (“Dimri”).

As of December 31, 2015, the Group does not expect to make any additional material repayments during the following 12 months period, if any, and accordingly other loans from stockholders have been presented as long-term liabilities.