Elbit Imaging Adjusts Plan of Arrangement in Light of Opinion of Court-Appointed Expert

       Elbit Imaging Adjusts Plan of Arrangement in Light of Opinion of
                            Court-Appointed Expert

PR Newswire

TEL AVIV, Israel, June 17, 2013

TEL AVIV, Israel, June 17, 2013 /PRNewswire/ --

Elbit Imaging Ltd. ("EI" or the "Company") (TASE, NASDAQ: EMITF) announced
today that following the receipt of the opinion of Roni Alroy, CPA, the
Court-appointed expert (as described in the Company's announcement dated June
6, 2013) ("Expert Opinion") and in light of the Expert Opinion, its board of
directors has resolved to make adjustments to the original plan of arrangement
(the "Original Plan of Arrangement") filed by the Company with the Tel Aviv
District Court (the "Court") (as described in the Company's announcement dated
May 9, 2013) and to file an amended plan of arrangement (the "Amended Plan of
Arrangement"). The adjustments to the Original Plan of Arrangement include the
following:

  oThe Company would issue two series of new notes in the aggregate principal
    amount of NIS 500 million (approximately US$ 136 million) (the "New
    Notes"), rather than issue one series of new notes in the aggregate
    principal amount of NIS 300 million pursuant to the Original Plan of
    Arrangement. The first series of New Notes would be in the aggregate
    principal amount of NIS 400 million (approximately US$ 109 million),
    repayable in a single payment at the end of six years from the date of
    issuance thereof, and secured by a first ranking floating charge on all
    property and assets of the Company. The second series of New Notes would
    be in the aggregate principal amount of NIS 100 million (approximately US$
    27 million), repayable in a single payment at the end of eight years from
    the date of issuance thereof, and secured by a second ranking floating
    charge on all property and assets of the Company. Both series of the New
    Notes would bear interest at the rate of 6% per annum and would not be
    linked to the consumer price index. Interest on the first series of New
    Notes would be payable in cash on a semi-annual basis, while interest on
    the second series of New Notes would be payable on the final maturity
    date, subject to prepayment in the sole discretion of the Company. The
    liens securing the New Notes would be subject to customary exceptions. In
    addition, at any time during the term of either series of the New Notes,
    the Company may create a senior lien in order to refinance the Company's
    outstanding indebtedness to Bank Hapoalim B.M. (the "Bank").
  oThe Company would issue to its unsecured financial creditors, in exchange
    for the remaining debt in excess of said NIS 500 million (approximately
    US$ 136 million), ordinary shares representing, immediately following such
    issuance, 90% (ninety percent) of the Company's outstanding share capital
    on a fully diluted basis (excluding certain options as described in the
    Original Plan of Arrangement), rather than ordinary shares representing
    86% of the Company's outstanding share capital on a fully diluted basis
    pursuant to the Original Plan of Arrangement. This number of ordinary
    shares to be issued as part of the Amended Plan of Arrangement was
    determined after taking into account the adjustments described herein and
    an analysis prepared for the Company by Fahn Kahne & Co. - Grant Thornton
    Israel. The Company has filed the full Hebrew-language analysis on the
    website of the Israel Securities Authority and will prepare and post a
    full English translation of the analysis on the Company's website at
    http://www.elbitimaging.com as soon as possible.
  oMordechay Zisser, the Company's Chief Executive Officer, Executive
    President and member of the Company's board of directors (who is also an
    indirect controlling shareholder of the Company), would not be included in
    the proposed release from potential liability and claims provided to the
    Company's other officers and directors, without derogating from any right,
    including his existing rights of indemnification and insurance coverage.
    The provisions in the Original Plan of Arrangement regarding the right to
    unilaterally terminate existing transactions between the Company or a
    company under the Company's control and Mr. Zisser and/or any entity under
    his control or in which Mr. Zisser and/or any entity under his control
    have a personal interest will not be included in the Amended Plan of
    Arrangement.
  oThe Amended Plan of Arrangement accepts and incorporates the
    Court-appointed expert's recommendation in regards to the Company's
    holdings in Elbit Medical Technologies Ltd. ("Elbit Medical"), which
    provides that the new corporate organs of the Company, as appointed after
    the closing of the Plan of Arrangement, should be assigned the task of
    examining the issue of realization of the shares of Elbit Medical, and if
    it will be practicable to benefit from a significant short term economic
    profit from the realization (whether by means of distribution or in some
    other way), then the aforesaid realization should be considered.

The Company wishes to negotiate with the Bank in an attempt to reach an
agreement pursuant to which the Bank would join the Amended Plan of
Arrangement as a party and the parties will amend the terms of the Company's
current outstanding indebtedness to the Bank in the amount of approximately
US$58 million (approximately NIS 213 million) in exchange for ordinary shares
of the Company and warrants to purchase ordinary shares of the Company to be
issued to the Bank. It is emphasized, however, that the Amended Plan of
Arrangement is not contingent upon a restructuring of the Bank's debt and may
be pursued also on the basis of the current terms of the loan (assuming the
Bank will not pursue the immediate repayment thereof). In the event that the
parties cannot reach an agreement and the Bank continues to demand immediate
repayment of the outstanding indebtedness owed to it by the Company (as
described in the Company's announcements dated June 6, 2013 and June 12,
2013), the Company will seek other financing sources to repay the outstanding
indebtedness owed to the Bank.

About Elbit Imaging Ltd.

Elbit Imaging Ltd. operates in the following principal fields of business: (i)
Commercial and Entertainment Centers - Initiation, construction and sale of
shopping and entertainment centers and other mixed-use real property projects,
predominantly in the retail sector, located in Central and Eastern Europe and
in India, primarily through its subsidiary Plaza Centers N.V. In certain
circumstances and depending on market conditions, the Company operate and
manage commercial and entertainment centers prior to their sale; (ii) Hotels -
Hotel operation and management; (iii) Medical Industries - (a) research and
development, production and marketing of magnetic resonance imaging guided
focused ultrasound treatment equipment and (b) development of stem cell
population expansion technologies and stem cell therapy products for
transplantation and regenerative medicine; (iv) Residential Projects -
Initiation, construction and sale of residential projects and other mixed-use
real property projects, predominately residential, located primarily in India;
and (v) Fashion Apparel - Distribution and marketing of fashion apparel and
accessories in Israel.

Safe Harbor Statement under the Private Securities Litigation Reform Act of
1995

Any forward-looking statements in our releases include statements regarding
the intent, belief or current expectations of Elbit Imaging Ltd. and our
management about our business, financial condition, results of operations, and
our relationship with our employees and the condition of our properties. Words
such as "believe," "would," "expect," "intend," "estimate" and similar
expressions are intended to identify forward-looking statements but are not
the exclusive means of identifying such statements. Actual results may differ
materially from those projected, expressed or implied in the forward-looking
statements as a result of various factors including, without limitation, the
risk that the Arrangement will not be approved by all the applicable
stakeholders of the Company, the Court or others, that challenges by third
parties or other events outside the control of the Company could delay the
implementation of the Arrangement and result in its termination, that Bank
Hapoalim will not agree to join the Arrangement on the terms proposed by the
Company or at all, that the Company will be unable to refinance the loans
owing to Bank Hapoalim, and the factors set forth in our filings with the
Securities and Exchange Commission including, without limitation, Item 3.D of
our annual report on Form 20-F for the fiscal year ended December 31, 2012,
under the caption "Risk Factors." Any forward-looking statements contained in
our releases speak only as of the date of such release, and we caution
existing and prospective investors not to place undue reliance on such
statements. Such forward-looking statements do not purport to be predictions
of future events or circumstances, and therefore, there can be no assurance
that any forward-looking statement contained in our releases will prove to be
accurate. We undertake no obligation to update or revise any forward-looking
statements.

For Further Information:

Company Contact:
Shimon Yitzhaki
Chairman of the Board of Directors
Tel: +972-3-608-6048
shimony@elbitimaging.com 

Investor Contact:
Mor Dagan
Investor Relations
Tel: +972-3-516-7620
mor@km-ir.co.il

SOURCE Elbit Imaging Ltd.
 
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