Black Sea Property AS

Related Party Transaction • Sep 5, 2022

Black Sea Property AS: Raises shareholder loan

Black Sea Property AS: Raises shareholder loan

As stated in the stock exchange notice dated 22 August 2022 from Black Sea Property AS (the "Company", and together with its consolidated subsidiaries, the "Group"), the Company has been looking to raise a smaller amount of capital to fund operations in Norway.

The Company has now received pre-commitments from certain major shareholders to participate in a shareholder loan of approximately NOK 2 million (the "Shareholder Loan"). The Shareholder Loan is expected to be settled by conversion of the loan to new shares in the Company.

The Shareholder Loan will hold an interest rate of 12% pro anno and a maturity date of 31 December 2023. Conversion of the loan shall take place in connection with the earlier of; (i) completion of an exit process for the Sunrise Gardens Resort, (ii) a share capital increase raising at least NOK 500 000, or (iii) upon maturity. The conversion price shall be NOK 0.70 per share, or lower if the Company completes a share capital increase with a lower subscription price per share than NOK 0.70.

Conversion of the loan to new shares will require approval by a general meeting of the Company, and the lending shareholders will undertake to vote in favour of such conversion at the general meeting.

The following members of the Company's Board of Directors (the "Board") participate in the Shareholder Loan:

- Hans Gulseth with NOK 280.000 and

- Dag Espen Arnesen with NOK 200.000

The Board has considered the Shareholder Loan in light of the equal treatment obligations applicable to the Company, and the Board is of the opinion that the Shareholder Loan is in the common interest of the Company and its shareholders as the Shareholder Loan provides necessary funding to the Company in a time- and cost-effective manner and with relatively low dilution.

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 Gardens. Sunrise Gardens Resort is a partially completed project and will upon completion comprise approximately 950 apartments as well as significant commercial space. Black Sea Property AS owns indirectly 75% of the project. Black Sea Property AS will work to finalize Sunrise Gardens Resort, to realize the project's added value through the sale of residential units and hotel operations.