Plaza Centers, bondholders agree to restrictions on dividends

By Angela McDaniels

Tacoma, Wash., Sept. 23 - Plaza Centers NV reached an agreement with the holders of its series A and series B bonds to cap its total dividend payments at €30 million per year in 2012 and 2013, according to a company filing with the London Stock Exchange.

As previously reported, the company declared a €30 million dividend, equivalent to €0.101 per share. It then received a demand from two bondholders that it withdraw the dividend, and the bond trustee held a general meeting of bondholders on Monday to discuss the dividend.

The dividend will be made as planned. The payment date was expected to be Friday.

In addition to the cap, the company agreed to the following conditions during 2012 and 2013:

• Dividends will be made only from the net cash flows derived from the realization of assets and will be capped at 50% of net cash flows received;

• If a dividend is paid while the average market yield of the series A and B bonds exceeds a certain threshold, the company will retain for 12 months at least €70 million in reserve accounts. Of this reserve, an amount equal to the dividend payment can be used solely to repurchase bonds and/or make principal and interest payments; and

• If a dividend is paid while the average market yield of the series A and B bonds is below a certain threshold, the company will be entitled to distribute dividends of up to €50 million per year. If this occurs, the amount of the dividend that exceeded €30 million will be held in a reserve account and used solely to repurchase bonds and/or make principal and interest payments.

Plaza Centers said the agreement was approved by the "vast majority" of bondholders and was made in light of the "ongoing challenging global economy."

As previously reported, the company announced on Tuesday that it repurchased NIS 15.74 million of the series A bonds and NIS 34.34 million of the series B bonds for a total cost of NIS 37.2 million.

Plaza Centers develops and invests in properties located in emerging markets and is based in Amsterdam. It is a subsidiary of Elbit Imaging Ltd., a Tel Aviv-based holding company.

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