Electromagnetic Geoservices ASA

Capital/Financing Update • Apr 23, 2019

EMGS secures second guarantee facility

EMGS secures second guarantee facility

Electromagnetic Geoservices ASA ("EMGS" or the "Company") is pleased to announce

that it has secured a second guarantee facility, to supplement the Company's

existing USD 10 million guarantee facility. The new guarantee facility (the "New

Facility") has a maximum limit of USD 7.5 million and is limited in scope to

providing certain performance and warranty guarantees required under the multi-

year acquisition contract which the Company, as announced in the stock exchange

notification published 23 April 2019, has received a letter of award for.

The New Facility is provided by the Company's existing bank. At the time of

establishment, the New Facility will be fully guaranteed by the Company's three

largest shareholders (the "Shareholder Guarantors"). The shareholder guarantees

will over time be replaced by a pledged cash depot (the "Pledged Depot") to be

built up by the Company, which will serve as security for the New Guarantee.

A counter guarantee agreement entered into between EMGS and the Shareholder

Guarantors regulates the Company's obligations towards the Shareholder

Guarantors in connection with the New facility. The Company will pay the

Shareholder Guarantors a guarantee commission of 8% p.a. of the guaranteed

amount. As the Pledged Depot is built up, the guarantee commission will be

reduced to 1.5% p.a. for such parts of the New Guarantee which are covered by

the Pledged Depot, and to 0% as the Shareholder Guarantors are released form

their obligations towards the bank. A cash sweep mechanism has been agreed with

the Shareholder Guarantors to ensure swift build-up of the Pledged Depot. Under

current estimates, the Company expects that the Pledged Depot will reach the

full USD 7.5 million during the course of the first quarter 2020.

Under certain change of control events, including a sale by a Shareholder

Guarantor of its shares in the Company, EMGS will be obligated to, within 30

days, replace the relevant Shareholder Guarantor with a new guarantor (or

otherwise ensure the release of such Shareholder Guarantor's obligations towards

the bank).

CEO of EMGS, Bjørn Petter Lindhom, comments:

"The New Facility is a prerequisite for the Company to be able to move forward

with the multi-year acquisition contract for which we have received a letter of

award from the customer. As such, this is a pivotal part of the puzzle in EMGS'

efforts to secure a material addition to the Company's backlog.

EMGS is very grateful towards the Shareholder Guarantors who have made this

possible, and highly committed to building up the required Pledged Depot as soon

as practicable possible to ensure that the bank will release the Shareholder

Guarantors from their obligations."

Contact

Hege Veiseth, CFO, +47 99 21 67 43

About EMGS

EMGS, the marine EM market leader, uses its proprietary electromagnetic (EM)

technology to support oil and gas companies in their search for offshore

hydrocarbons. EMGS supports each stage in the workflow, from survey design and

data acquisition to processing and interpretation. The Company's services enable

the integration of EM data with seismic and other geophysical and geological

information to give explorationists a clearer and more complete understanding of

the subsurface. This improves exploration efficiency and reduces risks and the

finding costs per barrel.

EMGS operates on a worldwide basis with offices in Trondheim, Oslo, Houston,

Mexico City, Rio de Janeiro and Kuala Lumpur.

This information is subject of the disclosure requirements pursuant to section

5-12 of the Norwegian Securities Trading Act.