Black Sea Property AS

Legal Proceedings Report • May 3, 2018

BLACK SEA PROPERTY AS - POSSIBLE DELAY OF OPENING OF AHELOY BEACH RESORT

BLACK SEA PROPERTY AS - POSSIBLE DELAY OF OPENING OF AHELOY BEACH RESORT

Black Sea Property AS ("BSP" or the "Company") has recently been informed that UniCredit Bulbank, whom the Company is in ongoing negotiations with regarding a possible EUR 3 million construction loan, will require additional security over certain assets as conditions precedent for disbursement of the loan. The creation and perfection of such security is anticipated to take up to 2 months. In addition, the Bulgarian government will impose a construction ban in the period between 15 May - 15 September 2018. The construction ban is imposed generally on the whole Black Sea Coast, but is subject to certain exemptions. The contractor for the Aheloy Beach Resort (the "Resort") has informed that they expect to be able to continue construction during this period, but no assurance can be given that they are actually able to continue construction during the period between 15 May - 15 September 2018.

Taken together with the other ongoing processes related to construction of the Resort, including connection to water & sewage and electric grids, the Company considers that there is a risk that the Resort will not open for business during the summer season of 2018. The final decision on whether or not the Resort will open for business during the summer season of 2018 is expected to be made within the end of May 2018.

Irregardless of whether the Resort will open for business during the summer season of 2018, the members of the Company's board of directors will still subscribe for at least NOK 5 million in the ongoing private placement with gross proceeds of up to NOK 11.5 million.

For further information, please contact:

Egil Melkevik, Chairman

Tel: +47 90 77 09 76

E-mail: egil.melkevik@imenco.com

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 Aheloy Beach Resort. Aheloy Beach Resort is a partially-completed project and will upon

completion comprise over 1,000 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 Aheloy Beach Resort, to realize the project's added value through the sale of residential units and hotel operations.