KMC Properties ASA

Share Issue/Capital Change • Nov 3, 2022

KMC PROPERTIES – CONTEMPLATED PRIVATE PLACEMENT

KMC PROPERTIES – CONTEMPLATED PRIVATE PLACEMENT

NOT FOR DISTRIBUTION OR RELEASE, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES OF AMERICA (INCLUDING ITS TERRITORIES AND POSSESSIONS, ANY STATE OF THE UNITED STATES OF AMERICA AND THE DISTRICT OF COLUMBIA) (THE "UNITED STATES"), AUSTRALIA, CANADA, THE HONG KONG SPECIAL ADMINISTRATIVE REGION OF THE PEOPLE'S REPUBLIC OF CHINA OR JAPAN, OR ANY OTHER JURISDICTION IN WHICH THE DISTRIBUTION OR RELEASE WOULD BE UNLAWFUL.

Reference is made to KMC Properties ASA's ("KMC Properties" or the "Company") announcement on 30 June 2022 regarding the entering into of an agreement with BEWI ASA ("BEWI") for the acquisition of up to 24 properties and one land plot with a gross asset value of up to approximately NOK 2.0 billion (the "Property Transaction") and that the Transaction will be partially funded through a fully underwritten private placement of new shares.

Carnegie AS, DNB Markets, a part of DNB Bank ASA, and Pareto Securities AS (together, the "Managers") have been engaged to advise on and effect a private placement of 37,500,000 new shares (the "Offer Shares) raising gross proceeds of NOK 300 million (the "Private Placement"), which will be directed towards Norwegian and international professional and institutional investors, in each case subject to and in compliance with applicable exemptions from relevant prospectus or registration requirements. The Company may, however, at its sole discretion, allocate an amount below EUR 100,000 to the extent applicable exemptions from the prospectus requirement pursuant to applicable regulations, including Regulation (EU) 2017/1129 (the EU Prospectus Regulation) and ancillary regulations, are available.

In connection with the Private Placement, the Company will hold a virtual investor presentation at 13:00 CET. In order to attend the investor presentation, please contact the Company or one of the Managers.

The net proceeds from the Private Placement will be used in connection with several projects across three different asset categories: (i) Capex: The Company has several income generating capex projects amounting to a gross amount of approx. NOK 12 million; (ii) Greenfield projects: The Company has two greenfield projects, a packaging hub for BEWI ASA at Hitra, Norway and a salmon slaughterhouse for Slakteriet AS, amounting to a total amount of approx. NOK 865 million, out of which the Company is only obligated to complete the packaging hub for BEWI ASA, amounting to NOK 200 million in committed investments; and (iii) the BEWI portfolio: The Company has entered into an agreement with BEWI ASA for the acquisition of up to 24 properties and one land plot (the "BEWI Portfolio") with a gross asset value of up to approx. NOK 2.0 billion, out of which the Company is under an obligation to acquire the Norwegian and Swedish assets in the BEWI Portfolio (valued at approx. NOK 940 million).

The subscription price in the Private Placement will be NOK 8 per Offer Share (the "Offer Price") and a total of 37,500,000 Offer Shares will be issued. The application period in the Private Placement will commence today, 3 November 2022, at 09:00 hours CET and close on 4 November 2022 at 08:00 hours CET (the "Bookbuilding Period"). The Company and the Managers may, however, at any time resolve to extend or shorten the Bookbuilding Period on short or no notice. If the Bookbuilding Period is extended or shortened, any other dates referred to herein may be amended accordingly.

BEWI Invest AS (currently directly and indirectly controlling 49.36% of the Company) and HAAS AS (currently owning 23.63% of the Company) have under a subscription and underwriting agreement entered into on 30 June 2022, as amended (the "UWA") pre-committed to subscribe for, and will be allocated, their pro rata ownership stake in the Company, amounting to approx. NOK 148.1 million and approx. NOK 70.9 million, respectively. Further, Kastor Invest AS, Aglen Holding AS, Hazelview and Banan II AS have under the UWA pre-committed to subscribe for, and will be allocated, Offer Shares for approx. NOK 17.1 million, approx. NOK 5.6 million, approx. NOK 4.4 million and approx. NOK 2.7 million, respectively.

The portion of the Private Placement that has not been pre-committed is underwritten at the Offer Price by BEWI Invest AS, HAAS AS and Constructio AS according to the UWA. BEWI Invest AS' shareholding will not reach the 50% mandatory offer threshold in connection with the Private Placement.

As disclosed in the Company's interim report for Q3 2022, the Company is in process of selling its Moscow office building and the Company expects to receive the proceeds from such sale (the "Sale Proceeds") by 31 December 2022. Should the Company not receive the expected amount of Sale Proceeds by such date, the Company may conduct a private placement of 6,250,000 new shares at the Offer Price raising gross proceeds of NOK 50 million. Under the UWA, the pre-committing investors and underwriters have pre-committed to subscribe and underwritten, respectively, an amount equal to 1/6 of the amount of their respective pre-commitment and underwriting in the Private Placement.

The underwriters and the pre-committed shareholders will receive a 4 per cent underwriting commission based on the sum of their commitment (i.e. a total of NOK 350 million). The Company's obligation to pay the underwriting commission will be settled by issuance of new shares (the "Underwriting Commission Shares") at the Offer Price.

The allocation of Offer Shares will be determined following the expiry of the Bookbuilding Period and the final allocation will be made by the board of directors of the Company (the "Board") in consultation with the Managers. Notification of allocation and payment instructions is expected to be issued to the applicants on or about 4 November 2022 through a notification to be issued by the Managers.

Completion of the Private Placement by delivery of Offer Shares and Underwriting Commission Shares is conditional upon: all corporate resolutions of the Company required to implement the Private Placement being validly made by the Company, including, without limitation, the resolutions by the Board to increase the share capital of the Company and issue the Offer Shares and Underwriting Commission Shares pursuant to an authorisation granted by the Company’s annual general meeting held on 1 June 2022, (ii) the UWA, and the pre-payment agreement entered into by the Company and the Managers, remaining unmodified and in full force and effect, and (iii) the share capital increases pertaining to the issuance of the allocated Offer Shares and the Underwriting Commission Shares being validly registered with the Norwegian Register of Business Enterprises and the allocated Offer Shares and the Underwriting Commission Shares being validly issued and registered in the VPS. Items (i) through (iii) in the foregoing are referred to as the "Conditions". The Private Placement may be cancelled if the Conditions are not fulfilled and may be cancelled by the Company in its sole discretion for any other reason.

The Offer Shares allocated in the Private Placement are expected to be settled through a delivery versus payment (DvP) transaction on or about 9 November 2022, following and subject to the satisfaction of the conditions for the Private Placement referred to above, including the share capital increase pertaining to the Offer Shares being registered with the Norwegian Register of Business Enterprises, expected to take place on or about 8 November 2022.

The Company reserves the right to, at any time and for any reason, to cancel the Private Placement and/or to modify the terms of the Private Placement. Neither the Company nor the Managers will be liable for any losses incurred by applicants if the Private Placement is cancelled, irrespective of the reason for such cancellation.

The Private Placement represents a deviation from the shareholders' pre-emptive right to subscribe for and being allocated the Offer Shares. The Board has considered the Private Placement in light of the equal treatment obligations under the Norwegian Public Limited Companies Act, the Norwegian Securities Trading Act, the rules on equal treatment under Oslo Rule Book II for companies listed on the Oslo Stock Exchange and the Oslo Stock Exchange's Guidelines on the rule of equal treatment, and deems that the proposed Private Placement is in compliance with these obligations. The Board is of the view that it will be in the common interest of the Company and its shareholders that the Company raises equity through a private placement at the current terms, in particularly in light of the prevailing market conditions and the Company's need to finance the Property Transaction. By structuring the equity raise as a private placement, the Company is expected to raise equity efficiently, with a premium to the current trading price. Investors seeking to acquire shares at or below the Offer Price have had the opportunity to do so for a period of time following announcement of the main terms of the transaction. As the Private Placement will be completed at a subscription price higher than the current market price, the Company is not contemplating a subsequent repair offering.

Advokatfirmaet Thommessen AS is acting as legal advisor to the Company in connection with the Private Placement.

For further information, please contact:

Charlotte Knudsen, IR and Communications KMC Properties ASA, tel. +47 97561959

About KMC Properties ASA

KMC Properties is an Oslo Børs-listed real estate company focusing on industrial- and logistic properties. The company has a diversified portfolio of properties, mainly in the Nordics and the Netherlands. The properties are strategically located and have long lease agreements with solid tenants.

KMC Properties has an ambitious strategy to grow the portfolio through further development of existing properties, as well as M&A initiatives.

Important information

This announcement does not constitute an offer for sale of, or a solicitation of an offer to purchase or subscribe for, any securities in the United States. Securities may not be offered or sold in the United States unless they are registered or are exempt from registration under the U.S. Securities Act of 1933, as amended. The information contained in this announcement is for informational purposes only and does not purport to be full or completed. The Company does not intend to register any portion of this offering in the United States or to conduct a public offering in the United States. Copies of this announcement are not being, and should not be, distributed in or sent into the United States.

It may be unlawful to distribute this announcement in certain jurisdictions. This announcement is not for distribution in Australia, Canada, the Hong Kong special administrative region of the People's Republic of China, Japan, South Africa, the United States or to any other jurisdiction where such distribution would be unlawful. The information in this announcement does not constitute an offer of securities for sale in such jurisdictions.

In the United Kingdom, this announcement is for distribution only to and is directed only at persons who (i) have professional experience in matters relating to investments which fall within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (as amended, the "Financial Promotion Order"), (ii) are persons falling within Article 49(2)(a) to (d) ("high net worth companies, unincorporated associations etc.") of the Financial Promotion Order, or (iii) are persons to whom an invitation or inducement to engage in investment activity (within the meaning of section 21 of the Financial Services and Markets Act 2000) in connection with the issue or sale of any securities may otherwise lawfully be communicated or caused to be communicated (all such persons together being referred to as "relevant persons"). This announcement is directed only at relevant persons and must not be acted on or relied on by persons who are not relevant persons. Any investment or investment activity to which this announcement relates is available only to relevant persons and will be engaged in only with relevant persons.

This announcement has been prepared on the basis that any offer of securities in any Member State of the European Economic Area which has implemented the Prospectus Regulation (EU) (2017/1129, as amended, the “Prospectus Regulation”) (each, a “Relevant Member State”) will be made pursuant to an exemption under the Prospectus Regulation, as implemented in that Relevant Member State, from the requirement to publish a prospectus for offers of securities. Accordingly any person making or intending to make any offer in that Relevant Member State of securities which are the subject of the offering contemplated in this announcement, may only do so in circumstances in which no obligation arises for the Company or any of the joint global coordinators to publish a prospectus pursuant to Article 3 of the Prospectus Regulation or supplement a prospectus pursuant to Article 16 of the Prospectus Regulation, in each case, in relation to such offer. Neither the Company nor any of the Managers have authorised, nor do they authorise, the making of any offer of the securities through any financial intermediary, other than offers made by the Managers which constitute the final placement of the securities contemplated in this announcement. Neither the Company nor any of the Managers have authorised, nor do they authorise, the making of any offer of securities in circumstances in which an obligation arises for the Company or any Managers to publish or supplement a prospectus for such offer.

The Managers and/or any of their affiliates or any of their respective directors, officers, employees, advisers, agents or any other person(s) do not accept any responsibility or liability whatsoever for, or make any representation or warranty, express or implied, as to the accuracy, completeness or fairness of the information or opinions in this announcement (or whether any information has been omitted from this announcement) or any other information relating the Company or associated companies. The Managers are acting exclusively for the Company and no-one else in connection with the Private Placement and will not regard any other person as their client in relation to the Private Placement and will not be responsible to anyone other than the Company for providing the protections afforded to their clients.

The issue, subscription, or purchase of shares in the Company is subject to specific legal or regulatory restrictions in certain jurisdictions. Neither the Company nor the Managers assume any responsibility in the event there is a violation by any person of such restrictions.

The distribution of this release may in certain jurisdictions be restricted by law. Persons into whose possession this release comes should inform themselves about and observe any such restrictions. Any failure to comply with these restrictions may constitute a violation of the securities laws of any such jurisdiction.

Forward-looking statements:

This announcement and any materials distributed in connection with this release may contain certain forward-looking statements. By their nature, forward-looking statements involve risk and uncertainty because they reflect the Company's current expectations and assumptions as to future events and circumstances that may not prove accurate. Several material factors could cause actual results and developments to differ materially from those expressed or implied by these forward-looking statements.