Seven Arts Pictures plc

November 11, 2008 04:38 ET

Miscellaneous (Employee Benefit Trust Purchase)

                                      SEVEN ARTS PICTURES PLC
                                  ("Seven Arts" or "the Company")
                                  Employee Benefit Trust Purchase

Seven Arts Pictures Plc (PLUS: SAPP and OTCBB: SAPXF), the PLUS-quoted feature films producer  and
distributor, announces that the Seven Arts Pictures Employee Benefit Trust ("EBT" or "Trust")  has
been established. The Company has no direct involvement in the running of the Trust.

The  Company  has made a loan, at a nominal interest rate, to the Trust of initially £0.5  million
rising  to  a maximum of £1.5 million and has transferred £800,000 of shares it holds in Armadillo
Investments  Limited (AIL),  which is currently in liquidation, to parties nominated  by  the  AIL
liquidator.  The transfer of these shares has also been treated as a loan from Seven Arts  to  the

The  Company  announces that on 30 October 2008 it received notification from Smith  &  Williamson
(Jersey)  Limited (the 'Trustee') in its capacity as trustee of the Trust that on 30 October  2008
the  Trustee purchased from the liquidator of AIL 3 million convertible preference shares  in  the
Company  previously held by AIL for an initial cash sum of £0.5 m and the return of the  £0.8m  of
Armadillo shares. Two further tranches of £500,000 are payable to the liquidator of Armadillo over
the next 12 months and have been guaranteed by the Company.

The  Company  has received a request from the Trust to convert 2,500,000 of the preference  shares
into  10,000,000 ordinary shares representing 29.06 per cent of the enlarged issued share  capital
of the Company. The remaining 500,000 preference shares are convertible at any time by the Trust.
A further announcement will be made in due course.


The Directors of the Issuer accept responsibility for this announcement.

For further information please contact:

Seven Arts Pictures plc US contact:
Peter Hoffman                                         Tel:  +1-323-692-5010

Seven Arts Pictures plc UK contact:
Elaine New, Finance Director                          Tel: +44 (0) 20 3006 8222

Corporate Adviser & Broker
Daniel Stewart & Co Plc
Stewart Dick                                          Tel: + 44 (0) 20 7776 6550

About Seven Arts:

Seven  Arts  Pictures  plc  was founded in 2002 as an independent motion  picture  production  and
distribution company engaged in the development, acquisition, financing, production, and licensing
of  theatrical motion pictures for exhibition in domestic (i.e. the United States and Canada)  and
foreign  theatrical  markets,  and  for subsequent worldwide release  in  other  forms  of  media,
including home video and pay and free television.

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