Last updated on April 18, 2014 at 16:58 EDT

Elbit Imaging Ltd. Announces NIS 75 million Bond Structured Transaction

August 2, 2012

TEL AVIV, Israel, August 2, 2012 /PRNewswire/ –

Elbit Imaging Ltd. (NASDAQ: EMITF) (“EI” or the “Company”) today announced that Elbit
Imaging Financing Services, Limited Partnership (“Elbit Financing”), a partnership owned
and controlled by the Company, had entered into a NIS 75 million bond structured
transaction with a leading global financial institution (the “Transaction” and the
“Counterparty” respectively), pursuant to which, Elbit Financing has purchased a NIS
denominated zero-coupon credit linked note, maturing on 2 October 2013 (the “CLN”) from
the Counterparty or its affiliate. The CLN references a portfolio of the Company’s bonds
(having a market value of NIS 75 million) (the “Bond Portfolio”). The Bond Portfolio was
purchased by Elbit Financing under the Company’s bond repurchase program that was
announced on May 23, 2011 and in the framework of the Transaction, it has sold the Bond
Portfolio to the Counterparty. In consideration, the Counterparty has paid to Elbit
Financing, the market value of the Bond Portfolio and arranged for the issuance of the
CLN, at an issue price of NIS 37.5 million.

During the term of the CLN, all the proceeds derived from the Bond Portfolio
(principal and interest) shall be retained by the Counterparty. At maturity of the CLN,
subject to no early termination event having occurred, the CLN shall be redeemed by
delivery to Elbit Financing (as noteholder) of the remaining, unamortised portion of the
Bond Portfolio.

Under the terms of the CLN, an early termination of the CLN can occur due to certain
occurrences, such as, inter alia a trigger event (which is linked to the decrease in the
market value of the Bond Portfolio below a pre-defined threshold level) or standard credit
events linked to a default by the Company on any of its bonds obligations. Upon the
occurrence of such an early termination event, the CLN shall be redeemed by payment to
Elbit Financing (as the noteholder) of a cash settlement amount derived from the then
prevailing bid price of the Bond Portfolio which, in certain circumstances, may be equal
to zero. In the case of a trigger event which is linked to the decrease in the market
value of the Bond Portfolio below a pre-defined threshold level, Elbit Financing or its
affiliates may provide such a bid price for the purchase of the Bond Portfolio.

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; (ii) U.S. Real Property
- Investment in commercial real property in the United States; (iii) Hotels – Hotel
operation and management, primarily in major European cities; (iv) 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; (v) Residential Projects – Initiation, construction and sale of residential
projects and other mixed-use real property projects, predominately residential, located
primarily in India and in Eastern Europe; (vi) Fashion Apparel – Distribution and
marketing of fashion apparel and accessories in Israel; and (vii) Other Activities – (a)
venture capital investments and (b) investments in hospitals and farm and dairy plants in
India. We have presently decided to suspend our investment activities in hospitals and
farm and dairy plants in India until we are satisfied that the economy has recovered
sufficiently to resume such activities.

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 its relationship with its
employees and the condition of our properties. Words such as “believe,” “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 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, 2011, 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 our
releases will prove to be accurate. We undertake no obligation to update or revise any
forward-looking statements. The transaction described above involves additional risk
factors associated with transactions of this type that are not included in Item 3.D (under
the caption “Risk Factors”) of our annual report on Form 20-F for the fiscal year ended
December 31, 2011. Among other things, credit linked notes involve a high degree of risk
as they represent an investment linked to the credit of certain reference item(s)which
will be influenced (positively or negatively) by fluctuations in the credit of the
relevant reference item(s), the time remaining to the redemption date and the
creditworthiness of the reference item which in turn may be affected by the economic,
financial and political events in one or more jurisdictions, and investors in reference
item linked notes may risk losing their entire investment. In the event of the occurrence
of certain circumstances specified in the applicable final terms, the relevant Issuer’s
delivery or payment obligation may be postponed or replaced by an obligation to pay other
amounts calculated by reference to the value of obligations issued by such Reference
Item(s), and hence, there is no assurance that the goals or expected results of the
transaction will be achieved.

        For Further Information:

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

        Investor Contact:
        Mor Dagan
        Investor Relations
        Tel: +972-3-516-7620

SOURCE Elbit Imaging Ltd.

Source: PR Newswire