Black Sea Property AS

Share Issue/Capital Change • Sep 26, 2023

Black Sea Property AS: Launch of conditional Private Placement

Black Sea Property AS: Launch of conditional Private Placement

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES, AUSTRALIA, CANADA, HONG KONG OR JAPAN, OR ANY OTHER JURISDICTION IN WHICH THE RELEASE, PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL. THIS ANNOUNCEMENT DOES NOT CONSTITUTE AN OFFER OF ANY OF THE SECURITIES DESCRIBED HEREIN.

Reference is made to earlier stock exchange announcements from Black Sea Property AS ("BSP" or the "Company", and together with its consolidated subsidiaries, the "Group") regarding, inter alia, EPO Aheloy OOD's (the holding company for the Resort, "EPO Aheloy") funding need of approximately EUR 800,000. The Company is required to contribute with 75% of the capital for this funding need, corresponding to EUR 600,000.

On this background, the Company is therefore announcing that it is contemplating carrying out a conditional private placement (the "Private Placement") of new shares (the "Offer Shares") in the Company to raise gross proceeds of up to NOK 6.5 million. The price per Offer Share will be a fixed price of NOK 0.25.

Assuming subscription of all Offer Shares, the Company will issue 26,000,000 Offer Shares in connection with the Private Placement, each Offer Share with a par value of NOK 0.25.

The net proceeds from the Private Placement will be utilized towards a mandatory payment of incurred interest under EPO Aheloy's credit facility with Penchev Consult, due in November 2023. Together with the Company's available liquidity, the amount raised in the Private Placement (assuming subscription of all Offer Shares) will be sufficient to fund the Company's portion, i.e. EUR 600,000 of the interest payment to Penchev Consult.

If the Private Placement is completed, the Company expects to launch a subsequent offering towards shareholders as of the date of the Private Placement that did not subscribe for Offer Shares (the "Eligible Shareholders") (the "Subsequent Offering"). The subscription price in the Subsequent Offering will be equal to the subscription price in the Private Placement. Completion of the Subsequent Offering will be subject to, amongst other things, approval by the Company's shareholders in a general meeting.

The subscription period in the Private Placement will commence today, 26 September 2023 at 16:50 CEST and close on 29 September 2023 at 16:30 CET. The Company may, however, at any time resolve to shorten or extend the subscription period for any reason. If the subscription period is shortened or extended, any other dates referred to herein may be amended accordingly.

The Private Placement will be directed towards certain existing shareholders of the Company and certain new investors, subject to and in compliance with applicable exemptions from relevant prospectus, filing or registration requirements.

Completion of the Private Placement is subject to the satisfaction of the following conditions; (i) all corporate resolutions of the Company's Board of Directors to proceed with the Private Placement and to allocate the Offer Shares having been made, (ii) the shareholders of the Company having approved the issue of the Offer Shares in a general meeting of the Company, and (iii) that the allocated Offer Shares have been fully paid, validly issued (by way of registration of the share capital increase pertaining to the issuance of the New Shares in the Norwegian Register of Business Enterprises) and registration of the Offer Shares in the VPS.

The Company's Board of Directors is of the opinion that the Private Placement complies with the equal treatment obligations. The Board of Directors considered alternative structures for the raising of new equity. Following careful considerations, the Board of Directors resolved that it will be in the common interest of the Company and its shareholders to raise equity through a private placement setting aside the pre-emptive rights of the shareholders. By structuring the transaction as a private placement, the Company will be in a position to raise capital in an efficient manner and with significantly lower risks compared to a rights issue. To ensure timely payment of interests to Penchev Consult, the Board of Directors has also assessed that the Private Placement is preferable compared to a rights issue. The Board of Directors also emphasized that the Subsequent Offering is intended to be carried out following the Private Placement and that the Subsequent Offering will allow all shareholders to reduce their dilution from the Private Placement.

For further information please contact:

Egil Melkevik, Chairman

Tel: +47 90 77 09 76

E-mail: em@ms-solutions.no

About Black Sea Property AS:

Black Sea Property AS is a real estate company with holdings in a real estate project on the Black Sea coast called Sunrise River Beach Resort. Sunrise River Beach Resort is a partially completed project and will upon completion comprise approximately 950 apartments as well as significant commercial space. Black Sea Property AS has indirect ownership to the project and will work to finalize Sunrise River Beach Resort, to realize the project's added value through the sale of residential units and hotel operations.

The information in this announcement is considered to be inside information pursuant to the EU Market Abuse Regulation. This stock exchange announcement was published by Egil Melkevik, Chairman, at the time and date provided.