Shefa Gems Regulatory News (SEFA)

B"H

5 November 2019

Shefa Gems Ltd.

("Shefa Gems" or the "Company")

Loan Agreement

Shefa Gems (LSE: SEFA), a company focused on advanced exploration and development of multi-gemstone projects in Northern Israel, is pleased to announce that it has entered into a convertible loan agreement over the provision of US$200,000 (approximately £156,250) (the "Agreement") with a shareholder of the Company ("the Lender") for working capital purposes and to fund the continued development of its Kishon Mid-Reach Project.

Terms of the Loan

Pursuant to the Agreement, the Lender has agreed to provide a loan for US$200,000 (approximately £156,250) (the "Loan"). The Loan, together with rolled up interest at 5%, is convertible into ordinary shares of the Company at a share price of £0.05 per share at any time until 31 March 2021. The Loan will be non-transferable.

Following conversion, the Company will grant the Lender one unlisted warrant for every share received on conversion, exercisable for a period of 24 months from the date of the conversion, at a price of £0.10 per warrant. In the event that the Company's share price during the period 24 months after conversion, does not at any time reach £0.10 per share, the Lender will receive additional shares after 24 months in such an amount as to make the total number of shares issued to the Lender have a value, based on the market price at that time, of £312,500.

Michael Rosenberg and James Campbell who are independent Directors, having consulted with the Company's Financial Adviser, consider the terms of the Loan, to be fair and reasonable insofar as all of Shefa's shareholders are concerned.

As at the date of this announcement, the entire issued share capital of the Company comprises of 172,425,315 Ordinary shares with a nominal value of 0.1 NIS each.

Michael Rosenberg, OBE, Chairman of Shefa Gems, said: "We are very pleased to have secured further funding at the prevailing market price from our supportive shareholder. On behalf of the Board, I would like to thank Shefa's existing shareholders for their continued support at this crucial time as Shefa continues to advance its Kishon Mid-Reach Project."

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About Shefa Gems Ltd

Shefa Gems Ltd (LSE: SEFA) is a multi-commodity explorer of precious stones operating in Northern Israel. Exploration activity is managed by professionally skilled and technically competent personnel and is accompanied by an international team of geological experts with decades of proven experience in their fields.

All exploration activities are conducted under international standards and the internationally recognised SAMREC 2016 Code. Furthermore, its four (4) permits, granted to it by the Commissioner of Mines at the Ministry of Energy, Natural Resources Administration, Israel, extend over an area of approximately 600,000 Dunam (60,000 hectares) that includes the Kishon River, the volcanic bodies on Mount Carmel, the Zevulun and Yizre'el valleys and their margins - Menashe Hills, Tivon-Alonim Hills, and Nazareth range. The Company upholds environmental values and protects the nature in the areas where it operates, cooperating fully with all authorities.

Alongside its exploration activities, the Company is building on the launch of the "Heaven on Earth" jewellery collection and developing the Company's "Mine to Market" strategy to promote unique jewellery collections utilising Shefa Gems' suite of precious gemstones.

The exclusive "Heaven on Earth" collection is now available to view online on the website of the designer Yossi Harari at: www.yossiharari.com/collections/heaven-on-earth

For further information please visit the website at www.shefagems.com